Anika Therapeutics
Feb 24, 2016

Anika Therapeutics Delivers Strong Performance with Record Product Revenue for the Fourth Quarter and Full Year 2015

Product Revenue Increased 43% Year-over-Year for Fourth Quarter of 2015

BEDFORD, Mass.--(BUSINESS WIRE)-- Anika Therapeutics, Inc. (NASDAQ: ANIK), a global, integrated orthopedic medicines company specializing in therapeutics based on its proprietary hyaluronic acid ("HA") technology, today reported financial results for the fourth quarter and full year ended December 31, 2015, along with business progress in the periods.

"We ended 2015 and entered 2016 with strong momentum in all aspects of our business -- commercial, clinical, operational, and financial," said Charles H. Sherwood, Ph.D., President and Chief Executive Officer. "First, product revenue increased 43% year-over-year for the fourth quarter, and our viscosupplementation franchise delivered robust performance and remained on track for market leadership in 2017. Second, we continued to advance our late-stage HA-based pipeline candidates, CINGAL and HYALOFAST, through the clinical development and regulatory channels. Third, as part of our strategic shift towards direct commercialization, we are consolidating our global manufacturing operations at our U.S. headquarters. Finally, we renewed our interest in strategic M&A opportunities that could augment our thriving organic business, and create value for shareholders over the short and long terms."

Fourth Quarter and Full Year Financial Results

Recent Business Highlights

The Company made key pipeline, commercial, operational, and financial advancements, including:

Full Year 2016 Corporate Outlook

Looking forward to 2016, the Company expects total revenue growth to be in the mid-teen percentage range. The Company also anticipates continued headway on several key initiatives including:

Conference Call Information

Anika management will hold a conference call and webcast to discuss its financial results, business highlights and financial outlook tomorrow, Thursday, February 25th at 9:00 am ET. The conference call can be accessed by dialing 1-855-468-0611 (toll-free domestic) or 1-484-756-4332 (international). A live audio webcast will be available in the "Investor Relations" section of Anika's website, www.anikatherapeutics.com. An accompanying slide presentation may also be accessed via the Anika website. A replay of the webcast will be available on Anika's website approximately two hours after the completion of the event.

About Anika Therapeutics, Inc.

Anika Therapeutics, Inc. (NASDAQ: ANIK) is a global, integrated orthopedic medicines company based in Bedford, Mass. Anika is committed to improving the lives of patients with degenerative orthopedic diseases and traumatic conditions by providing clinically meaningful therapeutic pain management solutions along the continuum of care, from palliative care to regenerative medicine. The Company has over two decades of expertise developing, manufacturing and commercializing more than 20 products, in markets across the globe, based on its proprietary hyaluronic acid (HA) technology. Anika's orthopedic medicine portfolio is comprised of marketed (ORTHOVISC® and MONOVISC®) and pipeline (CINGAL® and HYALOFAST® in the U.S.) products to alleviate pain and restore joint function by replenishing depleted HA and aiding cartilage repair and regeneration. For more information about Anika, please visit http://www.anikatherapeutics.com.

Forward-Looking Statements

The statements made in the second paragraph, the first and fourth bullet points in the section captioned "Recent Business Highlights," and the section captioned "Full Year 2016 Corporate Outlook" of this press release, which are not statements of historical fact, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, those relating to the Company's direct commercialization capabilities, the Company's interest in strategic M&A transactions, enrollment rates in the HYALOFAST clinical study, the commercial potential of HYALOFAST, the integration of the Company's manufacturing operations, the approval of CINGAL in the European Union, and the Company's expected revenue growth. These statements are based upon the current beliefs and expectations of the Company's management and are subject to significant risks, uncertainties, and other factors. The Company's actual results could differ materially from any anticipated future results, performance, or achievements described in the forward-looking statements as a result of a number of factors including (i) the Company's ability to successfully commence and/or complete clinical trials of its products, including for HYALOFAST, on a timely basis or at all; (ii) the Company's ability to obtain pre-clinical or clinical data to support domestic and international pre-market approval applications, 510(k) applications, or new drug applications, or to timely file and receive FDA or other regulatory approvals or clearances of its products, including for CINGAL; (iii) that such approvals will not be obtained in a timely manner or without the need for additional clinical trials, other testing or regulatory submissions, as applicable; (iv) the Company's research and product development efforts and their relative success, including whether we have any meaningful sales of any new products resulting from such efforts; (v) the cost effectiveness and efficiency of the Company's clinical studies, manufacturing operations, and production planning; (vi) the strength of the economies in which the Company operate or will be operating, as well as the political stability of any of those geographic areas; (vii) future determinations by the Company to allocate resources to products and in directions not presently contemplated; (viii) the Company's ability to successfully commercialize its products, in the U.S. and abroad; (ix) the Company's ability to provide an adequate and timely supply of its products to its customers; and (x) the Company's ability to achieve its growth targets. Additional factors and risks are described in the Company's periodic reports filed with the Securities and Exchange Commission, and they are available on the SEC's website at www.sec.gov. Forward-looking statements are made based on information available to the Company on the date of this press release, and the Company assumes no obligation to update the information contained in this press release.

 
Anika Therapeutics, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(unaudited)
       
Three Months Ended December 31, Year Ended December 31,
  2015   2014   2015   2014
Product revenue $

25,607

$ 17,880 $ 87,696 $ 75,474
Licensing, milestone and contract revenue  

5,287

 

5,375

  5,303   30,121
Total revenue 30,894

23,255

92,999 105,595
 
Operating expenses:
Cost of product revenue 6,290

5,511

21,053 20,930
Research & development 3,016

1,984

8,987 8,144
Selling, general & administrative  

4,524

 

3,673

  14,825   15,074
Total operating expenses  

13,830

 

11,168

  44,865   44,148
Income from operations

17,064

12,087 48,134 61,447
Interest income, net   39   42   120   58
Income before income taxes

17,103

12,129 48,254 61,505
Provision for income taxes   6,061   4,313   17,496   23,186
Net income $

11,042

$ 7,816 $ 30,758 $ 38,319
 
Basic net income per share:
Net income $ 0.74 $ 0.53 $ 2.06 $ 2.61
Basic weighted average common shares outstanding 14,965 14,801 14,934 14,678
Diluted net income per share:
Net income $ 0.72 $ 0.51 $ 2.01 $ 2.51
Diluted weighted average common shares outstanding 15,353 15,278 15,321 15,269
 
 
Anika Therapeutics, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(in thousands, except share data)
(unaudited)
   
December 31, December 31,
ASSETS   2015     2014  
Current assets:
Cash and cash equivalents $ 110,707

 

$ 100,156
Investments 27,751 6,750
Accounts receivable, net of reserves of $167 and $147 at December 31, 2015 and 2014, respectively 21,652 17,152
Inventories 14,938 12,407
Prepaid expenses and other current assets   1,385     1,371  
Total current assets 176,433 137,836
Property and equipment, at cost 64,648 53,620
Less: accumulated depreciation   (24,540 )   (21,951 )
40,108 31,669
Long-term deposits and other 69 69
Intangible assets, net 11,656 14,895
Goodwill   7,482     8,339  
Total Assets $ 235,748   $ 192,808  
 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 8,302 $ 1,201

Accrued expenses and other current liabilities

4,778 4,772
Income taxes payable   4,198     -  
Total current liabilities   17,278     5,973  
Other long-term liabilities 781 894
Long-term deferred revenue 66 102
Deferred tax liability 6,775 7,741
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value; 1,250,000 shares authorized, no shares issued and outstanding at December 31, 2015 and December 31, 2014 - -
Common stock, $.01 par value; 30,000,000 shares authorized, 15,036,808 and 14,851,703 shares issued and outstanding at December 31, 2015 and 2014, respectively 150 149
Additional paid-in-capital 81,685 77,540
Accumulated other comprehensive loss (6,649 ) (4,495 )
Retained earnings   135,662     104,904  
Total stockholders' equity   210,848     178,098  
Total Liabilities and Stockholders' Equity $ 235,748   $ 192,808  
 

 
Anika Therapeutics, Inc. and Subsidiaries
Supplemental Financial Data
               
 
Revenue by Product Line and Product Gross Margin
(in thousands, except percentages)
(unaudited)
 
Quarter Ended December 31, Year Ended December 31,
  2015     %     2014     %     2015     %     2014     %  
Orthobiologics $ 21,530 84 % $ 13,207 74 % $ 73,247 84 % $ 61,957 82 %
Surgical 1,363 5 % 1,273 7 % 5,812 7 % 5,855 8 %
Dermal 1,134 5 % 395 2 % 2,266 2 % 1,334 2 %
Other  

1,580

    6 %   3,005     17 %   6,371     7 %   6,328     8 %
Total Product Revenue $

25,607

    100 % $ 17,880     100 % $ 87,696     100 % $ 75,474     100 %
 

Product Gross Profit

$

19,317

$

12,369

$ 66,643 $ 54,544

Product Gross Margin

75

% 69 % 76 % 72 %
 
 
Total Product Revenue by Geographic Region
(in thousands, except percentages)
(unaudited)
 
Quarter Ended December 31, Year Ended December 31,
  2015     %     2014     %     2015     %     2014     %  

Geographic Location:

United States $ 20,574 80 % $ 14,324 80 % $ 71,621 82 % $ 62,606 83 %
Europe 2,462 10 % 936 5 % 8,756 10 % 6,204 8 %
Other  

2,571

    10 %   2,620     15 %   7,319     8 %   6,664     9 %
Total Revenue $

25,607

    100 % $ 17,880     100 % $ 87,696     100 % $ 75,474     100 %

Anika Therapeutics, Inc.
Charles H. Sherwood, Ph.D., President and CEO
or
Sylvia Cheung, CFO
781-457-9000

Source: Anika Therapeutics, Inc.

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