Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 3, 2016

 

 

LANTHEUS HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-36569   35-2318913

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

331 Treble Cove Road, North Billerica, MA 01862

(Address of principal executive offices) (Zip code)

Registrant’s telephone number, including area code: (978) 671-8001

Not Applicable

(Former name or former address, if changed since last report.)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02. Results of Operations and Financial Condition.

On May 3, 2016, Lantheus Holdings, Inc. (the “Company”) announced via press release its financial results as of and for the three months ended March 31, 2016. A copy of that press release is being furnished as Exhibit 99.1 and is hereby incorporated by reference.

The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act.

 

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit

No.

  

Description

99.1*    Press release of Lantheus Holdings, Inc. dated May 3, 2016, announcing its financial results as of and for the three months ended March 31, 2016.

 

* Exhibit 99.1 attached hereto is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

LANTHEUS HOLDINGS, INC.

By:

 

/s/ Michael P. Duffy

Name:

  Michael P. Duffy

Title:

  General Counsel and Senior Vice President, Strategy and Business Development

Date: May 3, 2016


EXHIBIT INDEX

 

Exhibit

No.

  

Description

99.1*    Press release of Lantheus Holdings, Inc. dated May 3, 2016, announcing its financial results as of and for the three months ended March 31, 2016.

 

* Exhibit 99.1 attached hereto is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.
EX-99.1

Exhibit 99.1

 

LOGO  

 

331 Treble Cove Road

North Billerica, MA 01862            

  

 

800.362.2668
www.lantheus.com

CONTACTS:

Meara Murphy

978-671-8508

Lantheus Holdings, Inc. Reports 2016 First Quarter Financial Results

Lantheus posts first quarter net income of $10.3 million and Adjusted EBITDA of $18.4 million;

First quarter worldwide DEFINITY® revenue increased 22% annually

NORTH BILLERICA, Mass., May 3, 2016Lantheus Holdings, Inc. (the “Company”) (NASDAQ: LNTH), parent company of Lantheus Medical Imaging, Inc. (“LMI”), a global leader in the development, manufacture and commercialization of innovative diagnostic imaging agents and products, today reported financial results for its first quarter ended March 31, 2016.

The Company’s worldwide revenue for the first quarter of 2016 totaled $76.5 million, representing an increase of 2% as-reported compared to $74.8 million reported for the first quarter of 2015. Constant currency revenue increased by 3% versus the prior year period. First quarter worldwide revenue results reflect the continued strong performance of DEFINITY® and increased revenues from the nuclear products portfolio driven by recently initiated contracts with key radiopharmacy customers.

Net income for the first quarter of 2016 totaled $10.3 million or $0.34 per diluted share, an improvement of $9.9 million compared to a net income of $0.4 million or $0.02 per diluted share in the first quarter of 2015. The first quarter net income results reflect a gain on the divestiture of the Company’s Canadian radiopharmacy business and a decrease in the amount of interest expense due to debt refinancing in June of 2015.

The Company’s first quarter 2016 Adjusted EBITDA, as defined in the GAAP to non-GAAP reconciliation provided later in this release, was $18.4 million, or 24.0% of reported revenue, compared to $20.6 million, or 27.5% of reported revenue, in the first quarter of 2015. The decrease in Adjusted EBITDA reflects the impact of contracting at lower prices for committed volumes with key radiopharmacy customers.

Mary Anne Heino, President and CEO commented, “We had a strong quarter, exceeding both our first quarter revenue and Adjusted EBITDA guidance. Our robust results were driven by continued excellent performance of DEFINITY in an increasingly competitive market and higher than forecasted sales of our nuclear products.”

Ms. Heino continued, “We are pleased to be raising our annual revenue and Adjusted EBITDA guidance despite the recent entrance into the U.S. market of a competitor to our Xenon product.”


Outlook

The Company is increasing its outlook for worldwide revenue for full year 2016 to a range of $287 million to $292 million. For the second quarter of 2016, the Company expects worldwide revenue in the range of $72 million to $74 million.

The Company is also increasing its outlook for full year 2016 Adjusted EBITDA, as described in the GAAP to non-GAAP reconciliation provided later in this release, to a range of $62 million to $66 million. For the second quarter of 2016, the Company expects Adjusted EBITDA in the range of $14 million to $16 million.

The Company’s guidance for worldwide revenue and Adjusted EBITDA are forward-looking statements. They are subject to various risks and uncertainties that could cause the Company’s actual results to differ materially from the anticipated targets. The anticipated targets are not predictions of the Company’s actual performance. See the cautionary information about forward-looking statements in the “Safe-Harbor Statement” section of this press release.

Internet Posting of Information

The Company routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.lantheus.com. The Company encourages investors and potential investors to consult its website regularly for important information about the Company.

Conference Call and Webcast

As previously announced, the Company will host a conference call starting at 4:30 p.m. (Eastern Time) today. To access the live conference call via telephone, please dial 1-866-498-8390 (U.S. callers) or 1-678-509-7599 (international callers) and provide passcode 88571392. A live audio webcast of the call also will be available on the homepage of the Company’s website at www.lantheus.com.

A replay of the telephone conference call and audio webcast will be available from approximately 8:30 p.m. ET on May 3, 2016 through midnight on May 17, 2016. To access a replay of the conference call, dial 1-855-859-2056 (U.S. callers) or 1-404-537-3406 (international callers), and provide passcode 88571392. A replay of this conference call will also be available in the Investor Relations section of our website located at www.lantheus.com.

The conference call will include a discussion of non-GAAP financial measures. Reference is made to the most directly comparable GAAP financial measures, the reconciliation of the differences between the two financial measures, and the other information included in this press release, our Form 8-K filed with the SEC today, or otherwise available in the Investor Relations section of our website located at www.lantheus.com.

The conference call may include forward-looking statements. See the cautionary information about forward-looking statements in the safe-harbor section of this press release.


About Lantheus Holdings, Inc. and Lantheus Medical Imaging, Inc.

Lantheus Holdings, Inc. is the parent company of LMI, which is a global leader in the development, manufacture and commercialization of innovative diagnostic imaging agents and products. LMI provides a broad portfolio of products, which are primarily used for the diagnosis of cardiovascular diseases. LMI’s key products include the echocardiography contrast agent DEFINITY® Vial for (Perflutren Lipid Microsphere) Injectable Suspension; TechneLite® (Technetium Tc99m Generator), a technetium-based generator that provides the essential medical isotope used in nuclear medicine procedures; and Xenon (Xenon Xe 133 Gas), an inhaled radiopharmaceutical imaging agent used to evaluate pulmonary function and for imaging the lungs. The Company is headquartered in North Billerica, Massachusetts with offices in Puerto Rico, Canada and Australia. For more information, visit www.lantheus.com.

Non-GAAP Financial Measures

The Company uses non-GAAP financial measures, such as net sales excluding the impact of foreign currency; operating income, as adjusted; net income, as adjusted; Adjusted EBITDA; net income, as adjusted, per diluted share; Adjusted EBITDA per diluted share; and free cash flow. The Company’s management believes that the presentation of these measures provides useful information to investors. These measures may assist investors in evaluating the Company’s operations, period over period. The measures may exclude such items which may be highly variable, difficult to predict and of a size that could have substantial impact on the Company’s reported results of operations for a period. Management uses these and other non-GAAP measures internally for evaluation of the performance of the business, including the allocation of resources and the evaluation of results relative to employee performance compensation targets. Investors should consider these non-GAAP measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.

Safe Harbor for Forward-Looking and Cautionary Statements

This press release contains “forward-looking statements” as defined under U.S. federal securities laws, including statements about our 2016 outlook. These statements reflect management’s current knowledge, assumptions, beliefs, estimates and expectations and express management’s current view of future performance, results and trends. Forward-looking statements may be identified by their use of terms such as anticipate, believe, confident, could, estimate, expect, intend, may, plan, predict, project, target, will and other similar terms. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to materially differ from those described in the forward-looking statements. Readers are cautioned not to place undue reliance on the forward-looking statements contained herein, which speak only as of the date hereof. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law. Risks and uncertainties that could cause our actual results to materially differ from those described in the forward-looking statements are discussed in our filings with the Securities and Exchange Commission (including those described in the Risk Factors section in our Annual Reports on Form 10-K and our Quarterly Reports on Form 10-Q).

– Tables Follow –


Lantheus Holdings, Inc. and subsidiaries

Condensed Consolidated Statements of Operations

(dollars in thousands, except share data – unaudited)

 

     Three Months Ended
March 31,
 
     2016     2015  

Revenues

   $ 76,474      $ 74,823   

Cost of goods sold

     42,773        39,054   
  

 

 

   

 

 

 

Gross profit

     33,701        35,769   

Operating expenses

    

Sales and marketing expenses

     9,307        9,072   

General and administrative expenses

     9,513        9,123   

Research and development expenses

     3,036        6,196   
  

 

 

   

 

 

 

Total operating expenses

     21,856        24,391   

Gain on sale of assets

     5,828        —     
  

 

 

   

 

 

 

Operating income

     17,673        11,378   

Interest expense, net

     (7,018     (10,623

Other income (expense), net

     58        (383
  

 

 

   

 

 

 

Income before income taxes

     10,713        372   

Provision (benefit) for income taxes

     390        (3
  

 

 

   

 

 

 

Net income

   $ 10,323      $ 375   
  

 

 

   

 

 

 

Net income per common share

    

Basic and diluted

   $ 0.34      $ 0.02   

Common shares

    

Basic

     30,368,240        18,080,944   

Diluted

     30,372,691        18,404,393   


Lantheus Holdings, Inc. and subsidiaries

Consolidated Revenue Analysis

(dollars in thousands – unaudited)

 

     Three Months Ended
March 31,
 
     2016      2015      % change  

U.S.

        

DEFINITY

     30,793         25,182         22.3

TechneLite

     21,733         18,173         19.6

Xenon

     8,172         13,186         (38.0 )% 

Other

     4,235         4,126         2.6
  

 

 

    

 

 

    

 

 

 

Total U.S.

   $ 64,933       $ 60,667         7.0
  

 

 

    

 

 

    

 

 

 

International

        

DEFINITY

     629         484         30.0

TechneLite

     3,103         2,687         15.5

Xenon

     2         8         (75.0 )% 

Other

     7,807         10,977         (28.9 )% 
  

 

 

    

 

 

    

 

 

 

Total International

   $ 11,541       $ 14,156         (18.5 )% 
  

 

 

    

 

 

    

 

 

 

Worldwide

        

DEFINITY

     31,422         25,666         22.4

TechneLite

     24,836         20,860         19.1

Xenon

     8,174         13,194         (38.0 )% 

Other

     12,042         15,103         (20.3 )% 
  

 

 

    

 

 

    

 

 

 

Total Revenues

   $ 76,474       $ 74,823         2.2
  

 

 

    

 

 

    

 

 

 


Lantheus Holdings, Inc. and subsidiaries

Supplemental Revenue Information

(unaudited)

 

     March 31, 2016 Quarter to Date Sales Growth/(Decline)  
     Domestic As
Reported
    Int’l Constant
Currency
    Int’l As
Reported
    Total Constant
Currency
    Total As
Reported
 

Products

          

DEFINITY

     22     43     30     23     22

TechneLite

     20     27     15     21     19

Xenon

     (38 )%      (75 )%      (75 )%      (38 )%      (38 )% 

Other

     3     (25 )%      (29 )%      (18 )%      (20 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Revenues

     7     (13 )%      (19 )%      3     2
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


Lantheus Holdings, Inc. and subsidiaries

Reconciliation of Revenues to Revenues Excluding the Impact of Foreign Currency

(dollars in thousands – unaudited)

 

     Three Months Ended March 31, 2016  
     International Net Sales      Total Net Sales  

Net sales, as reported

   $ 11,541       $ 76,474   

Currency impact as compared to prior period

     765         765   
  

 

 

    

 

 

 

Net sales, excluding the impact of foreign currency

   $ 12,306       $ 77,239   
  

 

 

    

 

 

 


Lantheus Holdings, Inc. and subsidiaries

Reconciliations of As Reported Results to Non-GAAP Financial Measures

(dollars in thousands – unaudited)

 

     Three Months Ended
March 31,
 
     2016     2015  

Operating income

    

Operating income, as reported

   $ 17,673      $ 11,378   

Reconciling items impacting

    

Operating income:

    

Campus consolidation costs

     —          3,610   

Gain on sale of assets

     (5,828     —     
  

 

 

   

 

 

 

Operating income, as adjusted

   $ 11,845      $ 14,988   
  

 

 

   

 

 

 

Operating income, as adjusted, as a percentage of net sales

     15.5     20.0
  

 

 

   

 

 

 
     Three Months Ended
March 31,
 
     2016     2015  

Net income

    

Net income, as reported

   $ 10,323      $ 375   

Reconciling items impacting

    

Gross Profit:

    

Campus consolidation costs

     —          77   

Reconciling items impacting

    

Operating Expenses:

    

Campus consolidation costs

     —          3,533   

Gain on sale of assets

     (5,828     —     
  

 

 

   

 

 

 

Net income, as adjusted

   $ 4,495      $ 3,908   
  

 

 

   

 

 

 

Net income, as adjusted, as a percentage of net sales

     5.9     5.2
  

 

 

   

 

 

 

Net income, as adjusted, per common share

    

Basic

   $ 0.15      $ 0.22   

Diluted

   $ 0.15      $ 0.21   

Common shares

    

Basic

     30,368,240        18,080,944   

Diluted

     30,372,691        18,404,393   


Lantheus Holdings, Inc. and subsidiaries

Reconciliation of As Reported Results to Non-GAAP Financial Measures

(dollars in thousands – unaudited)

 

     Three Months Ended
March 31,
 
     2016     2015  

EBITDA

    

Net income, as reported

   $ 10,323      $ 375   

Interest expense, net

     7,018        10,623   

Provision for income taxes

     94        1   

Depreciation

     2,007        5,688   

Amortization and accretion

     2,106        1,896   
  

 

 

   

 

 

 

EBITDA

     21,548        18,583   

Reconciling items impacting

    

EBITDA:

    

Stock-based and other compensation

     572        277   

Legal fees relating to business interruption claim

     4        17   

Asset write-off

     497        180   

Severance and recruiting costs

     669        97   

Sponsor fee and other

     —          571   

Gain on sale of assets

     (5,828     —     

New manufacturer costs

     900        862   
  

 

 

   

 

 

 

Adjusted EBITDA

   $ 18,362      $ 20,587   
  

 

 

   

 

 

 

Adjusted EBITDA as a percentage of net sales

     24.0     27.5
  

 

 

   

 

 

 


Lantheus Holdings, Inc. and subsidiaries

Reconciliation of Free Cash Flow

(dollars in thousands – unaudited)

 

     Three Months Ended  
     March 31, 2016     March 31, 2015  

Net cash provided by operating activities

   $ 3,780      $ 15,157   

Capital expenditures

     (1,652     (3,498
  

 

 

   

 

 

 

Free cash flow

   $ 2,128      $ 11,659   
  

 

 

   

 

 

 


Lantheus Holdings, Inc. and subsidiaries

Condensed Consolidated Balance Sheets

(dollars in thousands – unaudited)

 

     March 31, 2016     December 31, 2015  

Assets

    

Current assets

    

Cash and cash equivalents

   $ 38,880      $ 28,596   

Accounts receivable, net

     39,896        37,293   

Inventory

     15,541        15,622   

Other current assets

     5,721        3,851   

Assets held for sale

     —          4,644   
  

 

 

   

 

 

 

Total current assets

     100,038        90,006   

Property, plant and equipment, net

     85,324        86,517   

Capitalized software development costs, net

     8,615        9,137   

Intangibles, net

     19,235        20,496   

Goodwill

     15,714        15,714   

Other long-term assets

     20,337        20,509   
  

 

 

   

 

 

 

Total assets

   $ 249,263      $ 242,379   
  

 

 

   

 

 

 

Liabilities and stockholders’ deficit

    

Current liabilities

    

Current portion of long-term debt

   $ 3,650      $ 3,650   

Line of credit

     —          —     

Accounts payable

     12,984        11,657   

Accrued expenses and other liabilities

     14,845        18,502   

Liabilities held for sale

     —          1,715   
  

 

 

   

 

 

 

Total current liabilities

     31,479        35,524   

Asset retirement obligation

     8,417        8,145   

Long-term debt, net

     349,349        349,858   

Other long-term liabilities

     34,237        34,141   
  

 

 

   

 

 

 

Total liabilities

     423,482        427,668   
  

 

 

   

 

 

 

Stockholders’ deficit

     (174,219     (185,289
  

 

 

   

 

 

 

Total liabilities and stockholders’ deficit

   $ 249,263      $ 242,379   
  

 

 

   

 

 

 

###