3rd Quarter Results
November 25 2003 - 1:00AM
UK Regulatory
Results for the third quarter ended 30 September 2003
Cambridge, UK and Cambridge, Massachusetts - 25 November 2003 - Acambis plc
("Acambis") (LSE: ACM, NASDAQ: ACAM) announces its results for the third
quarter ended 30 September 2003.
Key points
- Record quarterly financial results:
- Revenue increased to �65.8m (2002 - �13.8m)
- Profit before tax of �22.2m (2002 - loss of �1.3m)
- Cash and short-term investments increased to �74.2m (2002 - �19.2m)
- Deliveries of investigational smallpox vaccine to US Government continuing
- Successful integration of Berna Products Corporation
- ARILVAX(TM) on track for BLA filing before year-end
- Phase I trial of West Nile vaccine underway
- Collaboration announced with World Health Organization on Japanese encephalitis
vaccine (see separate news release)
- Agreement reached with BTG International Limited on payment of turnover tax
Three months ended Nine months ended
30 September 30 September
2003 2002 2003 2002
Revenue �65.8m �13.8m �148.1m �26.7m
Profit/(loss) before tax �22.2m �(1.3)m �42.8m �(7.4)m
Earnings/(loss) per share 17.1p (1.4)p 34.7p (7.8)p
Earnings/(loss) per ADR $2.84 $(0.22) $5.77 $(1.23)
Cash �74.2m �19.2m �74.2m �19.2m
-ends-
A conference call for analysts will be held at 9.30 am GMT today. For details,
contact Mo Noonan at Financial Dynamics on telephone number +44 (0) 20 7269
7116. An instant replay of the call will be available until Wednesday, 24
December 2003 on telephone number UK: +44 (0) 20 8288 4459 and US: +1 334 323
6222. The pin code is 114342. An audio webcast of the call will also be
available via Acambis' website at www.acambis.com.
Enquiries:
Acambis plc
Dr John Brown, Chief Executive Officer Today: +44 (0) 20 7831 3113
Lyndsay Wright, Director of Communications Thereafter: +44 (0) 1223 275 300
Gordon Cameron, Chief Financial Officer Today: +44 (0) 20 7831 3113
Thereafter: +1 (617) 761 4200
Financial Dynamics
David Yates/ Charlie Armitstead Tel: +44 (0) 20 7831 3113
Chairman's statement
Overview
During the quarter, we have continued to make good progress in delivering on
the contract we have with the US Government to supply quantities of our
investigational smallpox vaccine for its emergency-use Strategic National
Stockpile. We are also continuing our clinical trial programme to evaluate the
safety and efficacy of the vaccine and are now preparing to commence Phase III
clinical trials.
In terms of the clinical development pipeline, we are nearing finalisation of
the submission of a Biologics License Application ("BLA") for the yellow fever
vaccine, ARILVAX(TM), and have recently initiated clinical trials of a vaccine
against West Nile virus. We have also announced today a collaboration with the
World Health Organization ("WHO") relating to our vaccine against Japanese
encephalitis ("JE").
Smallpox vaccine update
US Government contracts
During the third quarter we were able to record a significant portion of the
revenue relating to the balance of investigational ACAM2000 doses being
delivered under the 155 million-dose contract with the US Centers for Disease
Control and Prevention ("CDC"). The remaining investigational doses of the 155
million-dose contract are expected to be delivered in the final quarter of this
year.
The CDC has increased the current 155 million-dose order with Acambis for
additional doses of investigational ACAM2000 vaccine. We expect to deliver
approximately 18 million doses of this increased order in the fourth quarter of
2003.
ACAM2000 clinical trial programme
At the same time as delivering doses to the CDC, the clinical programme to
evaluate the safety and efficacy of ACAM2000 is continuing under the US
Investigational New Drug application with the Food and Drug Administration
("FDA"). Before the end of 2003, we expect to start two randomised,
double-blind Phase III trials to evaluate the safety and efficacy of ACAM2000
in comparison with a previously licensed vaccine, Dryvax(R). The trials will
include subjects who have previously been vaccinated against smallpox and
subjects who are na�ve to smallpox vaccination.
Modified Vaccinia Ankara ("MVA")
We continue to make good progress in our contract with the National Institute
of Allergy and Infectious Diseases ("NIAID") and are awaiting information from
the NIAID regarding the next vaccine supply contract, currently expected to be
awarded during 2004.
Travel vaccine franchise update
ARILVAX(TM)
At the beginning of October, we met the FDA to discuss the package of
information being provided to support the BLA relating to the planned US
licensure of the ARILVAX(TM) yellow fever vaccine. Following that meeting, we
remain on track to file our BLA before the end of this year.
Berna Products Corporation
The results for the third quarter included the first contribution from sales of
Vivotif(R) since the completion of the acquisition of Berna Products Corporation
("BPC") at the end of August. Through BPC, we have exclusive North American
sales and distribution rights to Vivotif(R), the world's only licensed orally
administered vaccine against typhoid. BPC's existing expertise and
infrastructure will be strategically important for the sale and promotion of
ARILVAX(TM).
Research and development ("R&ampD") update
ChimeriVax-West Nile
On 6 November, we announced the start of a Phase I trial of our vaccine against
West Nile virus, ChimeriVax-West Nile. The trial is a randomised, double-blind
out-patient study in 60 healthy adult volunteers and will test the safety,
tolerability and immunogenicity of the ChimeriVax-West Nile vaccine.
This is the first-ever human clinical trial of a potential vaccine against West
Nile virus, which has continued to pose a significant threat to health in the
US. Since first being identified in New York in 1999, the virus has swept
through 45 US states, caused disease in more than 12,000 people and resulted in
the deaths of several hundred individuals. We began work on this project within
months of the virus being diagnosed in the US and are the first company to
start clinical trials to evaluate a vaccine against West Nile.
ChimeriVax-JE
We have announced today that we are to collaborate with the WHO on the
development of our ChimeriVax-JE vaccine against JE. Under a Memorandum of
Understanding between WHO and Acambis, WHO will provide assistance and funding
for paediatric trials of ChimeriVax-JE in endemic countries. This is part of
WHO's efforts to enable the development of effective paediatric vaccines
against JE for developing countries where the virus is endemic.
In the first instance, WHO will assist with a trial of ChimeriVax-JE that we
plan to conduct at Mahidol University in Thailand, using vaccine manufactured
at our Canton facility. WHO will provide technical advice, infrastructure and
monitoring services, and also financial support. ChimeriVax-JE is separately
undergoing a two-year study in Australia to expand safety and efficacy
information and to investigate duration of immunity.
BTG agreement
In October, we announced that we had reached a settlement with BTG
International Limited ("BTG") concerning payments related to a technology
licence originally established in 1994. Under the agreement, Acambis was
required to pay 2% of its reported turnover to BTG, potentially until 2024.
Under the terms of the settlement, we agreed to pay �12m to BTG to discharge
all past and future rights, obligations and claims under the agreement. This is
a positive step for Acambis as it concludes our financial obligations to BTG.
Of the settlement payment, Acambis estimates �4.6m relates to historic amounts
due and payable under the Agreement since January 2002 when discussions between
Acambis and BTG about the Agreement were initiated. The balance of �7.4m
relates to potential future payments from the fourth quarter ("Q4") of 2003
onwards. Acambis will book the �7.4m balance during Q4 2003 as an exceptional
item against operating profit. The full payment will be made from cash before
the end of 2003. As we had factored in the full potential liability in our
future margin and earnings guidance, we expect our gross margins to increase by
approximately 2% more than previously envisaged from 2004 onwards.
Financial review
The financial results for the three months ("Q3") and nine months ended 30
September 2003 are presented below. Unless otherwise stated, the comparative
figures in parentheses relate to the equivalent period in 2002.
Trading results
Revenue for Q3 was �65.8m (2002 - �13.8m). The increase arose primarily from
the 155 million-dose ACAM2000 contract with the CDC. During Q3 we recorded the
first revenues from the sales of Vivotif(R) made by Berna Products Corporation
("BPC"). In Q3, we also continued to record sales of ACAM2000 smallpox vaccine
to other foreign governments, the NIAID in respect of our MVA contract, Aventis
Pasteur for our ChimeriVax-Dengue vaccine programme and the CDC in respect of
the wind-down activities for the ACAM1000 smallpox vaccine contract.
Cost of sales in Q3, representing costs in relation to all of the above revenue
excluding the ChimeriVax-Dengue programme, amounted to �37.4m (2002 - �10.1m),
the sharp increase being directly attributable to the increase in activity.
Expenditure on R&D in Q3 was �5.1m (2002 - �3.9m). The increase in expenditure
in 2003 is as a result of the progression of our projects to the later stages
of development.
Administrative costs, including amortisation of goodwill, increased in Q3 to �
1.5m (2002 - �1.1m), partially as a result of the acquisition of BPC in August
2003 but also as a result of increased sales and marketing activities. Interest
receivable increased to �0.6m for Q3 (2002 - �0.2m) as a result of higher
average levels of cash held throughout the period. Interest payable was
marginally lower in Q3 at �0.2m (2002 - �0.3m).
The pre-tax profit for Q3 was �22.2m (2002 - loss of �1.3m). The improvement
over 2002 was achieved primarily as a result of increased revenues under our
ACAM2000 smallpox vaccine programme, which generated the associated higher
profits.
During Q3, we recorded a tax charge of �4.3m (2002 - �nil). On the basis of our
forecast taxable profits for 2003, we expect that the Group will utilise the
vast majority of its available tax losses this year. Following the completion
of detailed projected tax computations during Q3 we anticipate the effective
tax rate will be in the region of 15% for 2003, which is within the range
previously indicated.
Capital expenditure
Capital expenditure for Q3 was �1.4m (2002 - �5.5m), which principally related
to the costs to redevelop and expand areas of our Cambridge US R&D facility.
The high level of expenditure in 2002 related to the reactivation of the Canton
manufacturing plant.
Acquisition of Berna Products Corporation
In August we announced that we had acquired BPC. We have consolidated that
business into the financial results presented for Q3. The cash outflow of �3.9m
in Q3 represents the initial payment of $6.4m of the total $8.4m cash
acquisition cost. The remaining $2.0m is payable in 2004.
The total potential acquisition cost of $12.5m for the business, which includes
milestones of up to $3.75m in respect of achieving key sales targets of Vivotif
(R) and ARILVAX(TM) between 2004 and 2006, has been used in order to calculate the
provisional goodwill figure arising of �6.7m. This figure is included within
Intangible Assets on the Balance sheet at 30 September 2003. The goodwill
calculation will be finalised before the end of 2003, but we do not anticipate
the outcome to change significantly.
Balance sheet highlights
i) Cash/debtors
Cash and short-term investments of the Group at 30 September 2003 amounted to �
74.2m (31 December 2002 - �11.8m). The increase in cash in 2003 resulted
primarily from the net cash receipts arising from further deliveries of
smallpox vaccine to the CDC under the 155 million-dose ACAM2000 contract.
Debtors (receivable within one year) increased substantially to �96.5m at 30
September 2003 (31 December 2002 - �54.0m), much of which relates to a
receivable from the CDC. Following the settlement of obligations to BTG during
the fourth quarter we expect to have approximately �120m in cash and short-term
investments by the end of the year.
ii) Stock/creditors: amounts falling due within one year
Stock held at 30 September 2003 had reduced to �16.7m (31 December 2002 - �
48.4m) following the transfer of stock to the CDC. The remaining balance
principally represents work-in-progress and finished goods in relation to
stocks of ACAM2000 smallpox vaccine. Payments for certain stock items do not
take place until after the invoicing for vaccine stocks to the US Government,
which continues to result in a high level of trade creditors at �25.0m (31
December 2002 - �54.8m).
Our adopted method for recognising revenue under the 155 million-dose ACAM2000
contract with the CDC, the percentage of cost-to-completion method, continues
to give rise to a significant deferred income balance, representing the
difference between invoices submitted and amounts recognised as revenue. At 30
September 2003, deferred income relating to this contract was �67.8m (31
December 2002 - �21.1m). This deferred income will unwind during the period
through to FDA licensure of the ACAM2000 smallpox vaccine.
iii) Lease financing and overdraft facilities
During 2003, and in accordance with the terms of the facility, we started to
repay the interest accruing on the US dollar-denominated lease-financing
facility secured via Baxter in December 2001 for the reactivation of our
manufacturing plant. The balance on the facility at 30 September 2003 was �
13.6m (31 December 2002 - �14.0m). The balance on the ARILVAX(TM) overdraft
facility at 30 September 2003 was �4.2m (31 December 2002 - �4.3m).
CEO recruitment
Following our announcement in September that Dr John Brown, Chief Executive
Officer, will be stepping down, we have appointed the executive recruiting firm
Russell Reynolds Associates to assist in the process to recruit a new Chief
Executive Officer and are currently evaluating potential candidates. We
anticipate being able to announce the outcome of the process in the first
quarter of 2004. Dr Brown plans to step down from his position, and the Board
of Acambis, on 31 December 2003, at which time Gordon Cameron, Acambis' Chief
Financial Officer, will become acting Chief Executive Officer until the
completion of the recruitment process.
Alan Smith
Chairman
This results statement was agreed by the Board of Directors on 24 November
2003.
Notes to editors:
Acambis is a leading developer of vaccines to prevent and treat infectious
diseases. Recognised internationally as the leading producer of smallpox
vaccines, Acambis is developing a second-generation smallpox vaccine which is
currently undergoing clinical trials and, under a unique arrangement given the
threat of smallpox being used as a bioterrorist weapon, is manufacturing
emergency-use stockpiles of this investigational vaccine for the US Government
and other governments around the world. Acambis is establishing a travel
vaccines franchise through its US-based subsidiary Berna Products Corporation,
which markets Vivotif(R), the world's only licensed oral typhoid vaccine, in
North America. Acambis has a number of other potential travel vaccines in
development and is conducting clinical trials of vaccines against yellow fever,
Japanese encephalitis and dengue fever. Acambis recently became the first
company to start human clinical trials of a vaccine targeting the West Nile
virus, which has spread to 45 US States in the last four years.
Acambis is based in Cambridge, UK and Cambridge, Massachusetts, US. Its primary
listing is on the London Stock Exchange (ACM) and its shares are listed in the
form of American Depositary Receipts on Nasdaq (ACAM). More information is
available at www.acambis.com.
"Safe Harbor" statement under the Private Securities Litigation Reform Act of
1995:
The statements in this news release that are not historical facts are
forward-looking statements that involve risks and uncertainties, including the
timing and results of clinical trials, product development, manufacturing and
commercialisation risks, the risks of satisfying the regulatory approval
process in a timely manner, the need for and the availability of additional
capital. For a discussion of these and other risks and uncertainties see "Risk
factors" in the Company's Annual Report and Form 20-F for the most recently
ended fiscal year, in addition to those detailed in the Company's filings made
with the Securities and Exchange Commission from time to time. These
forward-looking statements are based on estimates and assumptions made by the
management of Acambis and are believed to be reasonable, though are inherently
uncertain and difficult to predict. Actual results or experience could differ
materially from the forward-looking statements.
Quarterly results for the three months ended 30 September 2003
Group profit and loss account
Three Three
months months Nine months Nine months Year
ended ended ended ended ended 31
September September September September December
2003 2002 2003 2002 2002
(unaudited) (unaudited) (unaudited) (unaudited) (audited)
�m �m �m �m �m
______ ______ ______ ______ ______
Turnover 65.8 13.8 148.1 26.7 79.7
Cost of sales (37.4) (10.1) (87.1) (18.8) (49.2)
______ ______ ______ ______ ______
Gross profit 28.4 3.7 61.0 7.9 30.5
Research and development costs (5.1) (3.9) (15.2) (12.1) (16.5)
Administrative costs (including amortisation of goodwill) (1.5) (1.1) (3.7) (3.1) (4.3)
______ ______ ______ ______ _____
Group operating profit/(loss) before 21.8 (1.3) 42.1 (7.3) 9.7
exceptional items
Exceptional items:
Amounts written off fixed asset investment - - - - (0.1)
_____ _____ _____ _____ _____
Profit/(loss) on ordinary activities
before finance charges 21.8 (1.3) 42.1 (7.3) 9.6
_____ _____ _____ _____ _____
Interest receivable 0.6 0.2 1.3 0.5 0.7
Interest payable and similar charges (0.2) (0.3) (0.7) (0.9) (1.2)
Exchange gain on foreign currency borrowings - 0.1 0.1 0.3 0.5
_____ _____ _____ _____ _____
Profit/(loss) on ordinary activities
before taxation 22.2 (1.3) 42.8 (7.4) 9.6
_____ _____ _____ _____ _____
Taxation (4.3) - (6.4) - -
_____ _____ _____ _____ _____
Profit/(loss) on ordinary activities after
taxation being retained profit/(loss) for the period) 17.9 (1.3) 36.4 (7.4) 9.6
_____ _____ _____ _____ _____
Earnings/(loss) per ordinary share
(basic, note 2) 17.1p (1.4)p 34.7p (7.8)p 10.0p
_____ _____ _____ _____ _____
Earnings/(loss) per ADR (basic, note 3) $2.84 $(0.22) $5.77 $(1.23) $1.61
_____ _____ _____ _____ _____
Earnings/(loss) per ordinary share
(diluted, notes 2 and 4) 16.5p (1.4)p 33.7p (7.8)p 9.7p
_____ _____ _____ _____ _____
Group statement of total recognised gains and losses
Three Three
months months Nine months Nine months Year
ended ended ended ended ended 31
September September September September December
2003 2002 2003 2002 2002
(unaudited) (unaudited) (unaudited) (unaudited) (audited)
�m �m �m �m �m
______ ______ ______ ______ ______
Profit/(loss) for the period 17.9 (1.3) 36.4 (7.4) 9.6
(Loss)/gain on foreign currency translation (0.5) 0.1 (1.0) 1.6 1.3
_____ _____ _____ _____ _____
Total recognised gains and losses for the period 17.4 (1.2) 35.4 (5.8) 10.9
_____ _____ _____ _____ _____
Group balance sheet as at 30 September 2003
As at As at
September December
2003 2002
(unaudited) (audited)
�m �m
_____ _____
Fixed assets
Intangible assets 19.4 13.6
Tangible assets 22.2 20.0
Investments 1.1 1.1
_____ _____
42.7 34.7
_____ _____
Current assets
Stock 16.7 48.4
Debtors: amounts receivable within one year 96.5 54.0
Debtors: amounts receivable after one year 4.5 4.9
Short-term investments 49.6 0.1
Cash at bank and in hand 24.6 11.7
_____ _____
191.9 119.1
_____ _____
Creditors: amounts falling due within one year (126.2) (88.4)
_____ _____
Net current assets 65.7 30.7
_____ _____
Total assets less current liabilities 108.4 65.4
_____ _____
Creditors: amounts falling due after one year (18.3) (18.9)
_____ _____
Provisions for liabilities and charges
Investment in joint ventures:
- share of assets 0.9 0.9
- share of liabilities (1.2) (1.1)
_____ _____
(0.3) (0.2)
_____ _____
Net assets 89.8 46.3
_____ _____
Capital and reserves
Called-up share capital 10.5 9.9
_____ _____
Share premium account 95.3 87.8
Profit and loss account (16.0) (51.4)
_____ _____
Shareholders' funds - all equity 89.8 46.3
_____ _____
Reconciliation of movements in Group shareholders' funds
Nine months Year
ended ended
September 31 Dec
2003 2002
(unaudited) (audited)
�m �m
_____ _____
Retained profit for the period 36.4 9.6
(Loss)/gain on foreign currency exchange (1.0) 1.3
New share capital subscribed 8.1 7.7
_____ _____
Net increase in shareholders' funds 43.5 18.6
Opening shareholders' funds 46.3 27.7
_____ _____
Closing shareholders' funds 89.8 46.3
_____ _____
Quarterly results for the three months ended 30 September 2003
Group cash flow statement
Three Three
months months Nine months Nine months Year
ended ended ended ended ended 31
September September September September December
2003 2002 2003 2002 2002
(unaudited) (unaudited) (unaudited) (unaudited) (audited)
�m �m �m �m �m
______ ______ ______ ______ ______
Net cash (out)/inflow from operating activities (7.6) (3.6) 64.6 0.2 (6.2)
_____ _____ _____ _____ _____
Returns on investments and servicing of finance
Interest received 0.4 0.3 1.1 0.6 0.7
Interest paid (0.2) (0.1) (0.7) (0.1) (0.1)
_____ _____ _____ _____ _____
Net cash inflow from returns on 0.2 0.2 0.4 0.5 0.6
investments and servicing of finance _____ _____ _____ _____ _____
Taxation (0.1) - (2.0) - 0.1
_____ _____ _____ _____ _____
Capital expenditure and financial investment
Capital expenditure and financial investment
Purchase of tangible fixed assets (1.4) (5.5) (4.8) (10.0) (11.5)
Purchase of Berna Products Corporation (3.9) - (3.9) - -
_____ _____ _____ _____ _____
Net cash outflow from capital (5.3) (5.5) (8.7) (10.0) (11.5)
expenditure and financial investment _____ _____ _____ _____ _____
Net cash (out)/inflow before management (12.8) (8.9) 54.3 (9.3) (17.0)
of liquid resources and financing _____ _____ _____ _____ _____
Management of liquid resources (49.5) - (49.5) - -
_____ _____ _____ _____ _____
Financing
Net proceeds from issue of new shares:
- Baxter subscription - - 7.0 7.0 7.0
- Other 0.2 0.3 1.1 0.3 0.8
_____ _____ _____ _____ _____
Net cash inflow from financing 0.2 0.3 8.1 7.3 7.8
_____ _____ _____ _____ _____
(Decrease)/increase in cash for the period (62.1) (8.6) 12.9 (2.0) (9.2)
_____ _____ _____ _____ _____
Analysis of net funds/(debt)
1 January Exchange 30 September
2003 Cash flow movement 2003
�m �m �m �m
_____ _____ _____ _____
Cash 11.7 12.9 - 24.6
_____ _____ _____ _____
Liquid resources 0.1 49.5 - 49.6
Overdraft facility (4.3) - 0.1 (4.2)
Finance leases (14.0) - 0.4 (13.6)
_____ _____ _____ _____
Net (debt)/funds (6.5) 62.4 0.5 56.4
_____ _____ _____ _____
Quarterly results for the three months ended 30 September 2003
Reconciliation of operating profit/(loss) to net cash (out)/inflow from
operating activities
Three Three
months months Nine months Nine months Year
ended ended ended ended ended 31
September September September September December
2003 2002 2003 2002 2002
(unaudited) (unaudited) (unaudited) (unaudited) (audited)
�m �m �m �m �m
______ ______ ______ ______ ______
Group operating
profit/(loss) 21.8 (1.3) 42.1 (7.3) 9.7
Depreciation
and amortisation 1.1 0.8 2.9 1.8 2.6
Decrease/
(increase) in stock 27.5 (13.2) 31.4 (50.8) (52.6)
Decrease in debtors (80.6) (3.0) (34.6) (7.5) (50.6)
Increase in creditors 24.1 12.5 24.6 61.9 82.0
Exchange
differences
on inter-company
balances 0.2 - 0.1 - 1.3
Other (1.7) 0.6 (1.9) 2.1 1.4
______ ______ ______ ______ ______
Net cash (out)/inflow
from operating
activities (7.6) (3.6) 64.6 0.2 (6.2)
______ ______ ______ ______ ______
Notes
1. Basis of preparation
The financial information for the three and nine months ended 30 September 2003
is unaudited, and has been prepared in accordance with the accounting policies
set out in the Annual Report for the year ended 31 December 2002. The financial
information for the three and nine months ended 30 September 2002 is also
unaudited. The financial information relating to the year ended 31 December
2002 does not constitute statutory accounts within the meaning of Section 240
of the Companies Act 1985. This has been extracted from the full report for
that year which has been filed with the Registrar of Companies. The report of
the auditors on these accounts was unqualified. The Board approved the
financial statements for the year ended 31 December 2002 on 27 March 2003. The
statutory accounts for the year ended 31 December 2002 along with the Notice of
Annual General Meeting was sent to shareholders on 8 April 2003. The 2003
Annual General Meeting at which the statutory accounts for the year ended 31
December 2002 were laid was held on 13 May 2003.
2. Earnings/(loss) per ordinary share (basic)
The basic earnings per ordinary share for the three and nine months ended 30
September 2003 is based on a Group profit of �17.9 million and �36.4 million
respectively (2002 - loss of �1.3 million and �7.4 million respectively,
December 2002 - profit of �9.6 million). This has been calculated on the
weighted average ordinary shares in issue and ranking for dividend during the
period of 104,832,402 and 104,762,726 for the three and nine months ended 30
September 2003 (2002 - 95,279,335 and 95,271,375; December 2002 - 96,101,507).
3. Earnings/(loss) per ADR (basic)
Each American Depository Receipt ("ADR") represents 10 ordinary shares. The
basic earnings/(loss) per ADR is calculated by multiplying the earnings/(loss)
per ordinary share by a factor of 10 and then multiplying by the prevailing US
dollar exchange rate at the end of the relevant period. The exchange rates used
are 1.6614, 1.5726 and 1.6095 for 30 September 2003, 30 September 2002 and 31
December 2002 respectively.
4. Earnings/(loss) per ordinary share (diluted)
Diluted earnings per ordinary share for the three and nine months ended 30
September 2003 is based on the weighted average number of ordinary shares
outstanding of 108,515,995 and 108,063,104 respectively (December 2002 -
98,976,882) after adjusting for the effect of all dilutive potential ordinary
shares. Basic and diluted earnings per ordinary share were the same for the
three and nine months ended 30 September 2002 as the Company was loss-making
during this period.
5. Purchase of Berna Products Corporation
In August, we announced the acquisition of Berna Products Corporation ("BPC").
We acquired 100% of BPC's share capital for $8.4m in cash and may pay up to an
additional $3.75m in milestones, subject to the achievement of key sales
targets for Vivotif and ARILVAX. The fair value of the assets purchased is set
out below:
$m
Stock 0.2
Cash at bank and in hand 0.1
Debtors: amounts receivable within one year 0.2
______
Net assets acquired: 0.5
______
Net assets acquired 0.5
Goodwill arising 11.2
______
Purchase consideration 11.7
______
Split of consideration:
Cash consideration 8.2
Contingent consideration 3.2
Acquisition expenses 0.3
______
11.7
______
Both the cash consideration and the contingent consideration have been
discounted to reflect the time value of future payments. The total potential
acquisition cost prior to discounting future cashflows is $12.5m.
END
END
END
