Anika Therapeutics Reports 33% Revenue Growth in Third Quarter 2011
Earnings per share grow 144% to 22¢
Orthobiologics product revenue rises 35%, driven by growing Orthovisc® sales
Press Release Source: Anika Therapeutics, Inc. On Wednesday November 2, 2011, 4:01 pm EDT
BEDFORD, Mass.--(BUSINESS WIRE)-- Anika Therapeutics, Inc. (Nasdaq:ANIK - News), a leader in products for tissue protection, healing, and repair, based on hyaluronic acid (“HA”) technology, today reported financial results for the third quarter ended September 30, 2011.
For the third quarter of 2011, Anika’s revenue increased 33% to $18.5 million, from $13.9 million in the third quarter of 2010. This growth was driven by strong domestic and international sales of the company’s flagship product, Orthovisc®, as well as increased shipments of Anika’s ophthalmic and advanced wound care products.
For the nine-month period ended September 30, 2011, total revenue increased 13% to $46.3 million, from $40.8 million in the same period last year.
Operating and Net Income
Operating income for the third quarter of 2011 increased to $4.8 million, from $2.1 million in the same period in 2010. Net income rose to $3.0 million, or $0.22 per diluted share, from $1.2 million, or $0.09 per diluted share, in the third quarter of 2010. Anika’s effective tax rate for the third quarter of 2011 declined to 37.6% from 41.9% for the third quarter last year, primarily due to lower effective taxes on our Italian operations.
For the nine-month period ended September 30, 2011, net income rose 87% to $5.6 million, or $0.41 per diluted share, from $3.0 million, or $0.22 per diluted share, in the first nine months of 2010. This increase was a result of higher revenue, lower clinical study spending, and cost savings initiatives implemented in the past 21 months.
Product Gross Margin
Product gross margin for the third quarter of 2011 improved to 58%, from 54% in the third quarter last year. This improvement was driven by higher production volume.
For the nine-month period ended September 30, 2011, product gross margin was flat with the prior-year period at 56%.
Research and development expenses for the third quarter of 2011 declined to $1.5 million, from $1.8 million in the third quarter last year. The decrease in R&D expense was primarily due to lower clinical study spending compared to last year’s third quarter. R&D spending is expected to increase in future quarters. Selling, general and administrative expenses increased to $4.7 million, from $3.9 million in the third quarter a year ago. The increase in SG&A expenses was primarily due to foreign exchange losses on euro denominated assets caused by the strengthening of the U.S. dollar in September 2011.
Cash and Cash Equivalents
Anika’s cash and cash equivalents at September 30, 2011 rose to $29.0 million, from $28.2 million at December 31, 2010, mainly as a result of increased profits.
“Fueled by 35% growth in product revenue and continued operational streamlining, this was an excellent quarter for Anika,” said Charles H. Sherwood, Ph.D., president and chief executive officer. “Our product revenue growth was driven by strong U.S. and international sales of Orthovisc, as well as increased shipments of our ophthalmic products and the advanced wound care products from Anika S.r.l. that we have added to our dermal franchise, highlighted by Hyalomatrix®. In addition to contributing to our top-line growth, Anika S.r.l. continued to reduce its net loss in the third quarter.”
“The FDA recently commenced its inspection of our manufacturing facility in Bedford, Mass.,” added Sherwood. “And we are scheduled to complete the migration of the majority of our manufacturing from Woburn, Mass., to Bedford in the first quarter of 2012. Overall, we are well on our way toward making 2011 a successful year for Anika.”
Conference Call Information
Anika will hold a conference call to discuss its financial results, business highlights and outlook tomorrow, Thursday, November 3, 2011 at 9:00 a.m. ET. In addition, the Company will answer questions concerning business and financial developments and trends, and other business and financial matters affecting the Company, some of the responses to which may contain information that has not been previously disclosed.
To listen to the conference call, dial 888-873-4896 (international callers dial 617-213-8850) and use the passcode 79317701. Please call approximately 10 minutes before the starting time and reference Anika Therapeutics. In addition, the conference call will be available through a live audio webcast in the “Investor Relations” section of the Anika Therapeutics website, www.anikatherapeutics.com. An accompanying slide presentation also can be accessed via the Anika Therapeutics website. The conference call will be archived and accessible on the same website shortly after the conclusion of the call.