Announces Preliminary 2022 Financial Results
- The appointment of
Paul Williams , Emergent’s current SVP government/MCM business, as Senior Vice President, Products Business to lead the company’s MCM and commercial products business, including NARCAN® Nasal Spray. Paul will report directly toRobert G. Kramer , President and Chief Executive Officer. - Newly created Science and Development (S&D) function that unites research, product development, and clinical teams.
The S&D function will be led byKelly Warfield , Senior Vice President, Science and Development, and reporting toAdam Havey , Chief Operating Officer. The realigned S&D team will focus on programs that support our life cycle plans for our licensed products while growing the products and services businesses over the long term. - Elimination of 132 roles related to the S&D consolidation and other organizational changes representing approximately 5% of the current corporate workforce.
- Due to the realignment of these functions and the sharper focus on our core businesses, the following changes to the executive management team:
- Departure of
Atul Saran , EVP and Chief Strategy and Development Officer, effectiveMarch 17 . Strategy and Development teams will report to Stephanie Duatschek, Chief Strategy and Transformation Officer. - Departure of
Katy Strei , EVP and Chief Human Resource Officer, effectiveMarch 17 .Michelle Pepin is being promoted to Senior Vice President and Chief Human Resource Officer, effective immediately.
- Departure of
These actions, in combination with other cost reduction initiatives, are expected to result in annualized savings of over
“Emergent is undertaking these actions to strengthen our business, reduce costs and return to sustainable, long-term growth,” said Emergent President and CEO
Emergent’s product portfolio consists of an array of MCMs and commercial products, including, but not limited to, anthrax and smallpox vaccines and therapeutics, as well as NARCAN Nasal Spray for which the company has announced the
Emergent will also continue to offer CDMO services across its network of sites in the
Given these significant strategic changes, the company will provide its initial financial outlook for 2023 when it reports financial results for the fourth quarter and full year of 2022 in late
PRELIMINARY 2022 FINANCIAL RESULTS (Unaudited)
The company is providing the following selected preliminary, unaudited financial results for full-year 2022.
(in millions) | PRELIMINARY 2022 RESULTS ( | PRIOR 2022 GUIDANCE ( |
Total Revenues | ||
Net Income (Loss) | ||
Adjusted EBITDA(1) | ||
Adjusted Net Income (Loss)(1) |
(1) Represents a non-GAAP financial measure. See “Reconciliation of Non-GAAP Measures” for a definition of terms and applicable reconciliation tables.
Revenue Metrics
Total revenues for 2022 are expected to be in the range of $1,100 million to $1,120 million, a decrease at the midpoint of $683 million or 38% as compared to 2021.
Profitability Metrics
The company anticipates Adjusted EBITDA of $20 million to $40 million, a decrease at the midpoint of $487.6 million or 94% as compared to 2021. The company anticipates Adjusted Net Loss of $(90) million to $(70) million, compared to 2021 Adjusted Net Income of
Note:
The preliminary 2022 financial results are unaudited, subject to revision, and anticipated to be finalized by late February 2023. The company is in the process of finalizing its goodwill and long-lived asset impairment assessments for 2022 as well as any corresponding income tax impact. Any potential impairment has not been incorporated in these preliminary 2022 financial results. The company's final audited financial results could differ materially from these selected preliminary results.
2023 FINANCIAL OUTLOOK
The company will provide its initial financial outlook for 2023 when it reports financial results for the fourth quarter and full year of 2022 in late
RECONCILIATION OF NON-GAAP MEASURES (unaudited)
This press release contains financial measures (Adjusted Net Income (Loss) and Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization)) that are considered “non-GAAP” financial measures under applicable
The determination of the amounts that are excluded from these non-GAAP financial measures is a matter of management judgment and depends upon, among other factors, the nature of the underlying expense or income amounts. Because non-GAAP financial measures exclude the effect of items that will increase or decrease the company’s reported results of operations, management strongly encourages investors to review the company’s consolidated financial statements and publicly filed reports in their entirety.
This press release references changes in Total Revenues, Adjusted EBITDA and Adjusted Net Income (Loss) from the company’s full year 2021 performance to the mid-point of the estimated full year 2022 performance. The company believes these metrics are an important part of assessing performance on a year over year basis. These changes are expressed in dollars only. A reconciliation of the calculation of these changes is included below.
Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) (Unaudited)
Twelve Months Ended | Source | ||
(in millions) | 2022 (Estimated) | 2021 (Actual) | |
Net income (loss) | |||
Adjustments: | |||
+ Non-cash amortization charges | 64.0 | 62.7 | Intangible Asset (IA Amortization, Other Income |
+ Purchase accounting inventory step up | 54.0 | - | Product COGS |
+ Changes in fair value of contingent consideration | 3.0 | 2.9 | Product COGS |
+ Impairments | - | 41.7 | Impairment |
+ Acquisition-related costs (transaction & integration) | 2.0 | 0.9 | SG&A |
+ Tax effect | (3.0) | (13.4) | |
Total adjustments | $120.0 | $94.8 | |
Adjusted net income | $325.7 |
Reconciliation of Net Income (Loss) to Adjusted EBITDA (Loss) (Unaudited)
Twelve Months Ended | Source | ||
(in millions) | 2022 (Estimated) | 2021 (Actual) | |
Net income (loss) | $230.9 | ||
Adjustments: | - | - | |
+ Depreciation & amortization | 143.0 | 123.8 | COGS, SG&A, R&D |
+ Income taxes | (14.0) | 83.5 | Income Taxes |
+ Total interest expense, net | 34.0 | 33.9 | Other Expense |
+ Impairments | - | 41.7 | R&D |
+ Purchase accounting inventory step up | 54.0 | - | |
+ Changes in fair value of contingent consideration | 3.0 | 2.9 | COGS |
+ Acquisition-related costs (transaction & integration) | 2.0 | 0.9 | SG&A |
+ Other | 8.0 | - | |
Total adjustments | 230.0 | $286.7 | |
Adjusted EBITDA | $517.6 |
Reconciliation of the 2022 Estimated Midpoint of Total Revenues, Adjusted EBITDA and Adjusted Net Income (Loss) and the Dollar Changes as compared to 2021 Actual (Unaudited)
(in millions) | ||||
Twelve Months Ended | Total Revenues | Adjusted EBITDA | Adjusted Net Income (Loss) | |
2022 (Estimated) Range | ||||
2022 (Estimated) Midpoint of Range | $1,110.0 | $30.0 | $(80.0) | |
2021 (Actual) | $1,792.7 | $517.6 | $325.7 | |
Increase (decrease) at Midpoint of Range ($) | $(682.7) | $(487.6) | $(405.7) | |
Percentage increase (decrease) at Midpoint of Range | (38.1)% | (94.2)% | N/A |
About
At Emergent, our mission is to protect and enhance life. For over 20 years, we’ve been at work defending people from things we hope will never happen—so we are prepared just in case they ever do. We provide solutions for complex and urgent public health threats through a portfolio of vaccines and therapeutics that we develop and manufacture for governments and consumers. We also offer a range of integrated contract development and manufacturing services for pharmaceutical and biotechnology customers. To learn more about how we plan to protect or enhance 1 billion lives by 2030, visit our website and follow us on LinkedIn,
SAFE HARBOR STATEMENT
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, including statements regarding the future performance of the Company or our business strategy, future operations, future financial position, future revenues and earnings, projected costs, including estimated costs under the strategic reorganization, prospects, plans and objectives of management and the ongoing impact of the COVID-19 pandemic are forward-looking statements. We generally identify forward-looking statements by using words like “anticipate,” “believe,” “continue,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “should,” “will,” and similar expressions or variations thereof, or the negative thereof, but these terms are not the exclusive means of identifying such statements. Forward-looking statements are based on our current intentions, beliefs and expectations regarding future events. We cannot guarantee that any forward-looking statement will be accurate. Readers should realize that if underlying assumptions prove inaccurate or unknown risks or uncertainties materialize, actual results could differ materially from our expectations. Readers are therefore cautioned not to place undue reliance on any forward-looking statement. Any forward-looking statement speaks only as of the date of this press release, and, except as required by law, we do not undertake to update any forward-looking statement to reflect new information, events or circumstances.
There are a number of important factors that could cause our actual results to differ materially from those indicated by such forward-looking statements, including, among others, the availability of
Emergent BioSolutions Contacts:
Media:
Senior Director, Media Relations
240-760-0551
mediarelations@ebsi.com
Investors:
Vice President, Investor Relations
240-631-3280
burrowsr@ebsi.com
Source:
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