"The third quarter brought impressive news from our broad therapeutic antibody pipeline. We closed our alliance with Celgene for MOR202 and reported positive headline data from the Phase 1/2a trial of MOR208 in CLL. Amongst the partnered programs, bimagrumab became the first antibody based on our technology platform to receive breakthrough therapy designation from the FDA. It`s now the second program in our pipeline to enter a pivotal clinical trial. In addition, three partnered programs advanced into phase 2 clinical trials. That adds up to a very productive quarter," stated Dr. Simon Moroney, Chief Executive Officer of MorphoSys AG.
"The partnership deals with GSK and Celgene were the decisive events that will lead to a clear out-performance of our original 2013 financial guidance. MorphoSys is well positioned and well-funded to broaden and advance its proprietary portfolio in 2014 and to continue to build significant value," commented Jens Holstein, Chief Financial Officer of MorphoSys AG.
Financial Review for the First Nine Months of 2013 (IFRS)
On 10 January 2013, MorphoSys completed the sale of its research and diagnostic antibody segment AbD Serotec to Bio-Rad Laboratories, Inc. As a consequence, substantially all of the AbD Serotec segment was classified as discontinued operations. The operating segments Partnered Discovery and Proprietary Development as well as the part of AbD Serotec which remained with MorphoSys are presented as continuing operations.
Results from Continuing Operations
Group revenues from continuing operations for the first nine months of 2013 amounted to EUR 63.6 million (9-months 2012: EUR 35.4 million), an increase of 80 % over the prior year. The strong increase resulted predominantly from license payments received from Bio-Rad, GSK, and Celgene. The license payment from Bio-Rad derived from a non-exclusive license to use HuCAL in research and diagnostic applications in connection with their acquisition of MorphoSys`s AbD Serotec segment. The license agreement with GSK for MOR103, a HuCAL-derived antibody against GM-CSF, included an upfront payment for MorphoSys which was almost fully accounted for in 2013. The license agreement with Celgene covers the joint development of MOR202 as well as the co-promotion of the drug candidate in Europe and also includes an up-front payment which was recognized pro rata in 2013. Revenues in the Partnered Discovery segment comprised EUR 37.5 million in funded research and licensing fees (9-months 2012: EUR 32.1 million) and EUR 3.0 million in success-based payments (9-months 2012: EUR 1.9 million). The Proprietary Development segment recorded revenues of EUR 23.0 million (9-months 2012: EUR 1.2 million). The main reason for the increase over the prior year was the receipt of upfront payments from GSK and Celgene.
Total operating expenses from continuing operations for the first nine months of 2013 increased by 31 % to EUR 49.1 million (9-months 2012: EUR 37.6 million). Total research and development expenses increased by 24 % to EUR 35.9 million (9-months 2012: EUR 29.0 million). The increase in R&D expenses mainly resulted from higher personnel costs as well as costs for external laboratory services. Investment in proprietary product and technology development amounted to EUR 24.1 million (9-months 2012: EUR 17.2 million). Sales, general and administrative expenses increased by 53 % to EUR 13.2 million (9-months 2012: EUR 8.6 million) driven by higher expenses for personnel and for external services.
Earnings before interest and taxes (EBIT) from continuing operations amounted to EUR 14.6 million (9-months 2012: EUR -1.9 million). Partnered Discovery showed a segment EBIT of EUR 22.4 million (9-months 2012: EUR 17.9 million), while the Proprietary Development segment reported a segment EBIT of EUR 2.4 million (9-months 2012: EUR -13.1 million).
For the first nine months of 2013, MorphoSys recorded a net profit from continuing operations of EUR 10.9 million compared to a net loss of EUR 0.9 million in the same period of 2012. The resulting diluted earnings per share from continuing operations for the nine months ending 30 September 2013 amounted to EUR 0.45 (9-months 2012: EUR -0.04).
Results from Discontinued Operations
The sale of the research and diagnostic antibody segment AbD Serotec to Bio-Rad Laboratories, Inc. was completed on 10 January 2013. Results from discontinued operations reflect only the first ten days of the quarter. Revenues from discontinued operations were EUR 0.6 million (9-months 2012: EUR 13.5 million).
Total operating costs from discontinued operations amounted to EUR 2.3 million (9-months 2012: EUR 13.7 million), including cost of goods sold (COGS) in the amount of EUR 0.2 million (9-months 2012: EUR 4.8 million) as well as transaction-related costs in the amount of EUR 1.8 million.
During the nine months ending 30 September 2013, EBIT from discontinued operations after deduction of all attributable transaction costs amounted to EUR -1.7 million (9-months 2012: EUR -0.4 million). In connection with the deconsolidation, a disposal gain of EUR 8.0 million was accounted for, resulting in a profit before taxes of EUR 6.3 million (9-months 2012: a loss of EUR 0.5 million). The net profit from discontinued operations amounted to EUR 6.0 million (9-months 2012: net loss of EUR 0.4 million).
Results for the Group
Group net profit amounted to EUR 16.9 million (9-months 2012: EUR -1.2 million). The resulting fully diluted Group earnings per share amounted to EUR 0.68 (9-months 2012: EUR -0.05).
On 30 September 2013, the Company had EUR 401.9 million in cash, cash equivalents, marketable securities and bonds as well as other financial assets (reported in the balance sheet under cash and cash equivalents; available for sale financial assets; bonds, available for sale; and other receivables), compared to EUR 135.7 million as of 31 December 2012. Net cash inflow from operations in the first nine months of 2013 amounted to EUR 100.8 million (9-months 2012: EUR 2.4 million). The number of shares issued at 30 September 2013 was 26,111,009 compared to 23,358,228 on 31 December 2012. The increase of 2,752,781 shares resulted from the capital increase in August related to the alliance with Celgene, from the capital increase in September and from the exercise of stock options.
Third Quarter of 2013 (IFRS)
Results from Continuing Operations
In the third quarter of 2013, the Company generated revenues from continuing operations in the amount of EUR 15.4 million, compared to EUR 11.0 million in the same quarter of 2012. Total operating expenses amounted to EUR 18.0 million in Q3, compared to EUR 11.7 million in the same quarter of 2012. The increase of operating expenses was mainly due to increased personnel expenses and costs for external services. EBIT amounted to EUR -2.7 million (Q3 2012: EUR -0.6 million). Net loss for the third quarter 2013 was EUR 2.1 million, compared to a net loss of EUR 0.6 million in the third quarter of 2012.
Results from Discontinued Operations
During the third quarter of 2013, no revenues or expenses occurred within the AbD Serotec segment, which was sold to Bio-Rad in January of 2013.
Results for the Group
For the third quarter of 2013, Group net loss amounted to EUR 2.1 million (Q3 2012: net loss of EUR 0.2 million). The resulting fully diluted Group earnings per share amounted to
EUR -0.08 (Q3 2012: EUR -0.01).
Outlook for 2013
MorphoSys updated its guidance for 2013 on 24 October 2013 to reflect and further specify the impact of the alliance with Celgene for the future development of MOR202.
The Company`s management expects revenues of approximately EUR 74 million to EUR 78 million and an EBIT of EUR 7 million to EUR 10 million. Revenues are expected to be at the upper end of the given range.
MorphoSys will hold a public conference call and webcast today at 02:00 pm CET (01:00 pm GMT, 08:00 am EST) to present the Third Quarter Results 2013 and report on current developments.
Dial-in number for the analyst conference call (in English) at 02:00 pm CET; 01:00 pm GMT; 08:00 am EST (listen-only):
Germany: +49 (0) 89 2444 32975
For UK residents: +44 (0) 20 3003 2666
For US residents: +1 202 204 1514
Please dial in 10 minutes before the beginning of the conference.
In addition, MorphoSys offers participants the opportunity to follow the presentation through a simultaneous slide presentation online at http://www.morphosys.com.
A live webcast, slides, webcast replay and transcript will be made available at http://www.morphosys.com.
Approximately two hours after the press conference, a slide-synchronized audio replay of the conference will be available on http://www.morphosys.com.
The complete 3nd Interim Report 2013 (January - September) is available on our website (HTML and PDF): http://www.morphosys.com/FinancialReports
About MorphoSys:
MorphoSys developed HuCAL, the most successful antibody library technology in the pharmaceutical industry. By successfully applying this and other patented technologies, MorphoSys has become a leader in the field of therapeutic antibodies, one of the fastest-growing drug classes in human healthcare.
Together with its pharmaceutical partners, MorphoSys has built a therapeutic pipeline of more than 80 human antibody drug candidates for the treatment of cancer, rheumatoid arthritis, and Alzheimer`s disease, to name just a few. With its ongoing commitment to new antibody technology and drug development, MorphoSys is focused on making the healthcare products of tomorrow. MorphoSys is listed on the Frankfurt Stock Exchange under the symbol MOR. For regular updates about MorphoSys, visit http://www.morphosys.com
HuCAL®, HuCAL GOLD®, HuCAL PLATINUM®, CysDisplay®, RapMAT®, arYla® and Ylanthia® and 100 billion high potentials® are registered trademarks of MorphoSys AG.
Slonomics® is a registered trademark of Sloning BioTechnology GmbH, a subsidiary of MorphoSys AG.
This communication contains certain forward-looking statements concerning the MorphoSys group of companies. The forward-looking statements contained herein represent the judgment of MorphoSys as of the date of this release and involve risks and uncertainties. Should actual conditions differ from the Company`s assumptions, actual results and actions may differ from those anticipated. MorphoSys does not intend to update any of these forward-looking statements as far as the wording of the relevant press release is concerned.
For more information, please contact:
MorphoSys AG
Dr. Claudia Gutjahr-Löser
Head of Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-122
Mario Brkulj
Associate Director Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-454
Alexandra Goller
Specialist Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-332
investors@morphosys.com
Media Release (PDF)
3rd Interim Report (PDF)
This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients.
The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and other applicable laws; and
(ii) they are solely responsible for the content, accuracy and originality of the
information contained therein.
Source: MorphoSys AG via Thomson Reuters ONE
HUG#1741173
