March 01, 2012 / 7:00 am, CET
Press conference call (in German) today at 10:00 am CET
Conference call and webcast (in English) today at 2:00pm CET (1:00pm GMT; 8:00am EST)
- Success payments drive revenues over EUR 100 million
- Financial strength enabled increased R&D investment, doubling proprietary clinical portfolio
- Clinical pipeline expanded to 20 programs
- Next-generation antibody technology Ylanthia unveiled
MorphoSys AG (FSE: MOR; Prime Standard Segment; TecDAX) today announced financial results for the year ending December 31, 2011. Group revenues increased by 16% to EUR 100.8 million (at constant currency EUR 101.9 million) and operating profit increased by 24% to EUR 12.2 million (at constant currency EUR 12.9 million). The year was marked by strong progress in the Company's pipeline of therapeutic antibody candidates, bringing the number of partnered (16) and proprietary programs (4) in clinical development to 20. The clinical pipeline is expected to advance further with up to six drug programs ready to report proof-of-concept data in 2012, including MorphoSys's proprietary lead compound MOR103. With regards to technology, MorphoSys showed major progress highlighted by the presentation of its next-generation antibody platform Ylanthia. The strength of MorphoSys's existing technology alliances was underscored by a large milestone payment for the installation of the Company's HuCAL platform at the premises of Novartis in Basel in the first quarter of the year. This one-off milestone contributed significantly to the 2011 financial results, with revenues exceeding EUR 100 million for the first time in the Company's history, and a solid cash position of EUR 134.4 million as of December 31, 2011 (December 31, 2010: EUR 108.4 million).
| In EURO million | 2011 | 2010 | Q4 2011 | Q4 2010 |
| Group Revenues | 100.8 | 87.0 | 17.1 | 24.3 |
| Hereof AbD Serotec | 19.3 | 20.2 | 5.2 | 5.1 |
| Other Operating Income | 0.5 | 0.2 | 0.1 | 0.2 |
| Total Operating Expenses | 89.1 | 77.4 | 25.0 | 22.6 |
| Operating Profit/(Loss) | 12.2 | 9.8 | (7.8) | 1.9 |
| Net Profit/(Loss) | 8.2 | 9.2 | (4.8) | 2.0 |
| EPS (diluted) in EURO | 0.36 | 0.40 | - | - |
Highlights of the Year 2011
Pipeline: At the end of 2011, MorphoSys's pipeline comprised a total of 76 partnered and proprietary programs. The total number of programs in clinical trials increased from 17 at the beginning of 2011 to 20 at year-end.
- Proprietary Development Progress: At the end of 2011, MorphoSys had four proprietary programs in clinical development (MOR103 in RA and MS, MOR208 in CLL and MOR202 in MM). At the end of 2011, eight proprietary programs were active.
- Partnered Development Progress: At the end of 2011, 16 partnered programs were in clinical development. Altogether, at the end of 2011, 68 partnered programs were ongoing.
AbD Serotec: The increasing focus on diagnostics led to a new milestone in 2011 with the launch of the first diagnostic kits based on HuCAL antibodies.
Technology:
- In December 2011, MorphoSys unveiled its next-generation antibody technology Ylanthia. MorphoSys expects Ylanthia to set new standards for therapeutic antibody generation in the pharmaceutical industry over the next decade and beyond. Commercial application of the new platform will commence in 2012.
- New deals based on the Slonomics platform for protein engineering, such as the agreement with Novozymes in industrial biotechnology, provided an attractive new revenue component.
'2011 was an exceptional year for MorphoSys. Strong revenue growth driven by a record-level of success-based payments enabled us to invest strongly in our proprietary product portfolio,' commented Jens Holstein, Chief Financial Officer of MorphoSys AG. 'Group revenues will become more volatile in the years ahead, due to the greater influence of new deals and milestone-related one-off items, but more importantly, we have a proven business model and the solid financial foundation to continue to invest in long-term value drivers and maintain profitability in the years ahead.'
'Over the past twelve months the Company has made great strides in advancing its product pipeline and its technology platform,' stated Dr. Simon Moroney, Chief Executive Officer. 'These developments are important long-term value-drivers for us. In 2012 we expect to see a lot of clinical data as the ongoing Phase 2 trial of our MOR103 is completed and up to five partnered programs also complete Phase 2 trials. We also look forward to the first commercial applications of our new Ylanthia platform, which we expect to become a new technology standard in our sector in the years to come.'
Financial Review for the Fiscal Year 2011 (IFRS)
Group revenues for the full year 2011 amounted to EUR 100.8 million (2010: EUR 87.0 million), an increase of 16 % over the prior year. Revenues in the Partnered Discovery segment comprised EUR 46.6 million in funded research and licensing fees (2010: EUR 57.2 million) and EUR 32.7 million in success-based payments (2010: EUR 9.1 million). The record level of success-based payments resulted predominantly from a technology milestone payment from Novartis. The Proprietary Development segment recorded funded research revenues of EUR 2.4 million (2010: EUR 1.8 million). Assuming constant foreign exchange rates at the average rate of 2010, segment revenues in the Partnered Discovery and Proprietary Development segments would have amounted to EUR 82.4 million. The AbD Serotec segment provided 19 % or EUR 19.3 million of total revenues (2010: EUR 20.2 million), a decrease of 4 %. Assuming constant foreign exchange rates at the average rate of 2010, revenues in the AbD Serotec segment would have amounted to EUR 19.8 million. Other operating income increased by EUR 0.3 million to EUR 0.5 million in 2011 and comprised grant income from governmental agencies.
Total operating expenses for the full year 2011 increased by 15 % to EUR 89.1 million (2010: EUR 77.4 million). The change in operating expenses of 11.7 million was mainly caused by increased proprietary research and development (R&D) expenses. Cost of goods sold (COGS), a line item specific to AbD Serotec, decreased by 4 % to EUR 7.0 million (2010: EUR 7.3 million). Total research and development expenses rose by EUR 10.6 million or 23 % to EUR 57.5 million in 2011 (2010: EUR 46.9 million). The increase in R&D expenses mainly resulted from a higher level of investment in proprietary product and technology development amounting to EUR 36.7 million (2010: EUR 28.1 million). Sales, general and administrative expenses increased by 6 % to EUR 24.6 million (2010: EUR 23.2 million). Non-cash charges related to stock-based compensation are embedded in COGS, S,G&A and R&D expenses and amounted to EUR 1.5 million (2010: EUR 2.1 million).
Total Group operating profit increased to EUR 12.2 million (2010: EUR 9.8 million). Earnings before interest and taxes (EBIT) amounted to 11.1 million (2010: 13.1 million). Partnered Discovery showed a segment operating profit of EUR 55.7 million (2010: EUR 42.7 million) while EUR 35.0 million were invested into proprietary development (2010: investment of EUR 26.5 million). In the AbD Serotec segment, operating profit decreased to EUR 1.0 million (2010: EUR 1.2 million), which represents an operating margin of 5 %.
Non-operating income and expenses, including taxes, resulted in a loss of EUR 4.0 million (2010: non-operating loss of EUR 0.6 million). For the full year 2011, MorphoSys realized a net profit of EUR 8.2 million compared to a net profit of EUR 9.2 million in the previous year. The resulting diluted earnings per share for the year 2011 amounted to EUR 0.36 (2010: EUR 0.40).
On December 31, 2011, the Company had EUR 134.4 million in cash, cash equivalents and marketable securities, compared to EUR 108.4 million as of December 31, 2010. Net cash inflow from operations in 2011 amounted to EUR 27.1 million (2010: EUR 1.9 million). The number of issued shares at December 31, 2011 was 23,112,167, compared to 22,890,252 shares at December 31, 2010.
Fourth Quarter of 2011 (IFRS)
In the fourth quarter of 2011, the Company generated revenues of EUR 17.1 million, compared to EUR 24.3 million in the same quarter of 2010. Total operating expenses amounted to EUR 25.0 million in Q4, compared to EUR 22.6 million in the same quarter of 2010. The increase of operating expenses was mainly due to increased personnel expenses and costs for external services. The resulting operating loss amounted to EUR 7.8 million (Q4 2010: operating profit of EUR 1.9 million). Net loss for the fourth quarter 2011 was EUR 4.8 million, compared to a net profit of EUR 2.0 million in the fourth quarter of 2010.
Outlook for 2012
The Company continues to expand and advance its pipeline of proprietary and partnered development programs. Based on its platform of leading technologies, MorphoSys plans to further broaden its roster of partnerships and customers. The management of the Company foresees a variety of business opportunities. For 2012, MorphoSys anticipates total Group revenues between EUR 75 million and EUR 80 million and anticipates an EBIT in the range of EUR 1 million to EUR 5 million. This guidance does not, at this stage, include a successful out-licensing of any of the Company's proprietary development programs. Investment in proprietary research and development in 2012 will be approximately EUR 20-25 million. MorphoSys's management team will provide a more detailed outlook in today's conference call.
MorphoSys will hold its conference call and webcast today to present the Annual Financial Results 2011 and the Outlook 2012.
Dial-in number for the press conference call (in German) at 10:00 am CET:
Germany: +49 (0) 89 2444 32975
Dial-in number for the analyst conference call (in English) at 02:00 pm CET; 01:00 pm GMT; 08:00 am EST (listen-only):
Germany: +49 (0) 89 2444 32975
For UK residents: +44 (0) 20 3003 2666
For US residents: +1 212 999 6659
Please dial in 10 minutes before the beginning of the conference.
In addition, MorphoSys offers participants the opportunity to follow the presentation through a simultaneous slide presentation online at http://www.morphosys.com.
A live webcast, slides, webcast replay and transcript will be made available at http://www.morphosys.com.
Approximately two hours after the press conference, a slide-synchronized audio replay of the conference will be available on http://www.morphosys.com.
Consolidated Financial Statements 2011 (IFRS) are available on our website:
http://www.morphosys.com/FinancialReports
About MorphoSys:
MorphoSys developed HuCAL, the most successful antibody library technology in the pharmaceutical industry. By successfully applying this and other patented technologies, MorphoSys has become a leader in the field of therapeutic antibodies, one of the fastest-growing drug classes in human healthcare. The Company's AbD Serotec unit uses HuCAL and other technologies to generate superior monoclonal antibodies for research and diagnostic applications.
Through its own development efforts and successful partnerships in the pharmaceutical industry, MorphoSys has built a therapeutic pipeline of more than 70 human antibody drug candidates for the treatment of cancer, rheumatoid arthritis, and Alzheimer's disease, to name just a few. With its ongoing commitment to new antibody technology and drug development, MorphoSys is focused on engineering the medicines of tomorrow. MorphoSys is listed on the Frankfurt Stock Exchange under the symbol MOR. For regular updates about MorphoSys, visit http://www.morphosys.com
HuCAL®, HuCAL GOLD®, HuCAL PLATINUM®, Ylanthia®, arYla®, CysDisplay® and RapMAT® are registered trademarks of MorphoSys AG.
Slonomics® is a registered trademark of Sloning BioTechnology GmbH, a subsidiary of MorphoSys AG.
This communication contains certain forward-looking statements concerning the MorphoSys group of companies. The forward-looking statements contained herein represent the judgment of MorphoSys as of the date of this release and involve risks and uncertainties. Should actual conditions differ from the Company's assumptions, actual results and actions may differ from those anticipated. MorphoSys does not intend to update any of these forward-looking statements as far as the wording of the relevant press release is concerned.
For more information, please contact:
MorphoSys AG
Dr. Claudia Gutjahr-Löser
Head of Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-122
Mario Brkulj
Senior Manager Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-454
Jessica Kulpi
Specialist Corporate Communications & IR
Tel: +49 (0) 89 / 899 27-332