Pharmacopeia and Pharmacopeia Drug Discovery Announce March 2004
Quarter Financial Results
Operating Cash Flow Improved in Spite of Lower Revenues
SAN DIEGO, May 4 /PRNewswire-FirstCall/ -- Pharmacopeia, Inc. and
Pharmacopeia Drug Discovery, Inc. today announced consolidated results for the
quarter ended March 31, 2004. Both companies reported lower revenues in the
March 2004 quarter when compared to the same period in 2003, however,
consolidated cash flow from operations improved to $10.6 million in the March
2004 quarter compared to $7.2 million generated in the March 2003 quarter.
During the current quarter the Company generated an increase in cash and
marketable securities of $7.6 million resulting in a balance of $141.6 million
at March 31, 2004.
Revenues at Pharmacopeia Drug Discovery (PDD) were $5.4 million for the three
months ended March 31, 2004 compared to $7.5 million for the quarter ended
March 31, 2003. Lower milestone revenues, which are typically lumpy, and lower
lead optimization revenues were realized in the current period as compared to
2003.
At Pharmacopeia, Accelrys software revenues were $11.1 in the March 2004
quarter compared to $17.2 in the three months ended March 31, 2003. Orders
were lower in the quarter and the introduction of our new license offering at
January 1, 2004, which requires subscription accounting, also contributed to
the decrease. In addition, during 2003, Accelrys discontinued unprofitable
one-off consulting projects and closed out consortia.
Consolidated Sales, General and Administration expenses included about $900
thousand of costs associated with the consolidation of lab facilities at PDD in
Princeton in the March 2004 quarter. Restructuring and other charges of $11.1
million were also recorded in the March 2004 quarter. Included in these
charges were a lease write-off at PDD, deferred compensation charges and
severance costs. In addition $2.3 million of attorney, auditing and other fees
related to the spin-off of PDD, which was successfully completed on April 30,
2004, were reported in the quarter as spin-off transaction costs.
A consolidated net operating loss of ($26.8) million or ($1.11) per share was
reported for the March 2004 quarter, which included $900 thousand of relocation
costs, $11.1 million of restructuring and other charges and the $2.3 million of
spin-off transaction costs referred to above. In the 2003 March quarter, a net
loss of ($5.5) million or ($.23) per share was reported.
John Hanlon, CFO of Pharmacopeia commented, "At Accelrys, lower revenues in the
quarter were attributed to a combination of effects related to lower orders,
the change in accounting required by our new license offering, the
discontinuation of un-profitable one-off consulting work in 2003 and the
conclusion of consortia in 2003. As we have said in the past, the results of
the March quarter have never been a leading indicator of future performance at
Accelrys. On a positive note, we are pleased that our consolidated operating
cash flow was about $3.3 million higher in the quarter when compared to the
same period in 2003 and that the total of cash and investments increased to
over $141 million in the quarter. We are also pleased to have booked a
substantial, multi-year agreement at Accelrys with AstraZeneca during the
quarter," added Hanlon.
With regard to guidance Hanlon continued, "We expect to book a modest increase
in orders in fiscal 2005 compared to the twelve months ended March 31, 2004,
which was fiscal 2004. Due to the requirement to account for our new license
on a subscription basis and subject to our customers' adoption of the new
license, we expect reported revenues to be substantially lower in fiscal 2005
compared to fiscal 2004. Deferred revenues are expected to increase
proportionally when comparing the balance at March 31, 2005 to the balance at
March 31, 2004. Operating cash flow is expected to increase in fiscal 2005
over fiscal 2004.
Further details regarding Pharmacopeia's March 2004 quarter will be presented
in a conference call today. Mark Emkjer, President and CEO of Accelrys will
host the call. Forward-looking and material information may be discussed on
this conference call.
Date: Tuesday, May 4, 2004
Time: 9:00 a.m. EDT
Domestic Callers: (800) 360-9865
International Callers: (973) 317-1168 Webcast information can be accessed by visiting http://www.accelrys.com/. A replay of the conference call, which can be accessed by dialing toll-free
(800) 428-6051, and outside the U.S. by dialing (973) 709-2089, will be
available for 2 weeks. The access code for the replay is 354072.
Accelrys (http://www.accelrys.com/) is a leader in enabling science and
technology that accelerates and improves the drug discovery and chemical
development processes. Accelrys develops and commercializes molecular modeling
and simulation software for the life sciences and materials research markets,
cheminformatics and decision support systems, and bioinformatics tools
including gene sequence analysis. Accelrys is headquartered in San Diego,
California.
PDD (http://www.pharmacopeia.com/) is a chemistry-based collaborative drug
discovery company, focused on the creation of new small molecule therapeutics. Using proprietary technologies and processes, PDD's experienced scientists
identify and optimize novel drug candidates through research collaborations
with major pharmaceutical and biological companies and through its own
internally-funded drug discovery programs. PDD is headquartered in Princeton,
New Jersey.
Contact:
John J. Hanlon
Chief Financial Officer
(858) 799-5000
When used anywhere in this document, the words "expects," "believes,"
"anticipates," "estimates" and similar expressions are intended to identify
forward-looking statements. Forward-looking statements herein may include
statements addressing future financial and operating results of Pharmacopeia. Pharmacopeia has based these forward-looking statements on its current
expectations about future events. Such statements are subject to risks and
uncertainties including, but not limited to, the successful implementation of
Pharmacopeia's strategic plans, the acceptance of new products, the
obsolescence of existing products, the resolution of existing and potential
future patent issues, additional competition, changes in economic conditions,
and other risks described in documents Pharmacopeia has filed with the
Securities and Exchange Commission, including its most recent report on Form
10-K and subsequent reports on Form 10-Q. All forward-looking statements in
this document are qualified entirely by the cautionary statements included in
this document and such filings. These risks and uncertainties could cause
actual results to differ materially from results expressed or implied by
forward-looking statements contained in this document. These forward-looking
statements speak only as of the date of this document. Pharmacopeia disclaims
any undertaking to publicly update or revise any forward-looking statements
contained herein to reflect any change in its expectations with regard thereto
or any change in events, conditions or circumstances on which any such
statement is based.
PHARMACOPEIA, INC. SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in thousands, except share data)
Statements of Operations For the Quarters
Ended March 31,
2004 2003
Revenue:
Software license, service and other $11,135 $17,219
Drug discovery services 5,369 7,521
Total revenue 16,504 24,740 Cost of revenue:
Software license, service and other 4,107 5,169
Drug discovery services 5,550 5,776
Total cost of revenue 9,657 10,945
Gross margin 6,847 13,795
Operating costs and expenses:
Research and development 5,654 5,733
Sales, general and administrative 15,288 14,658
Restructuring and other charges 11,147 (384)
Total operating costs and expenses 32,089 20,007
Operating loss (25,242) (6,212)
Spin-off transaction costs (2,321) -
Interest and other income, net 924 1,136
Loss before tax provision (26,639) (5,076)
Provision for income taxes 131 377
Net loss $(26,770) $(5,453) Net loss per share
Basic and diluted $(1.11) $(0.23) Weighted average shares of common
stock outstanding
Basic and diluted 24,090 23,617 PHARMACOPEIA, INC. SELECTED CONSOLIDATED FINANCIAL DATA
(Dollars in thousands)
Balance Sheets March 31, December 31,
2004 2003 Cash, cash equivalents and marketable
securities $141,629 $134,055
Trade receivables, net 11,358 42,082
Other assets, net 67,491 63,530
Total assets $220,478 $239,667 Current liabilities $51,805 $51,684
Long-term liabilities and reserves 8,422 5,249
Total stockholders' equity 160,251 182,734
Total liabilities and stockholders'
equity $220,478 $239,667
DATASOURCE: Pharmacopeia, Inc.
CONTACT: John J. Hanlon, Chief Financial Officer, Pharmacopeia, Inc., +1-858-799-5000, Web site: http://www.pharmacopeia.com/ http://www.accelrys.com/
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