QLT Announces Q1 Results for 2007

Conference Call Scheduled for April 25 at 8:30 a.m. Eastern Time

VANCOUVER, April 24, 2007 /PRNewswire-FirstCall/ - QLT Inc. today reported financial results for the first quarter ended March 31, 2007. Unless specified otherwise, all amounts are in U.S. dollars and in accordance with U.S. GAAP.

    2007 Q1 Results


    Sales

Visudyne(R) worldwide sales for the first quarter were $61.2 million, a decrease of 42.7% over the first quarter of 2006. Visudyne sales in the U.S. were $8.4 million, down 72.4% over last year, while sales in the rest of the world were $52.8 million, a decrease of 30.7% over last year. The decline in Visudyne sales during the first quarter was mainly due to continued pressure in the U.S. and new competition in the European market.

Eligard(R) worldwide sales for the first quarter were $41.8 million, up 145.6% from the first quarter of 2006. Eligard sales in the U.S. were $19.5 million, up 341% over last year, while sales in the rest of the world were $22.3 million, an increase of 76.9% over last year.

Earnings Per Share (EPS)/Loss Per Share

EPS was $0.06 in the first quarter, compared to $0.13 a year ago. The decline was primarily due to the reduction in Visudyne sales.

Non-GAAP EPS, which excludes stock option expense and the restructuring charge, was $0.08 for the first quarter. Exhibit 1 provides the detailed reconciliation between GAAP and non-GAAP EPS.

QLT Revenues

The Company's revenues were $32.7 million in the first quarter, down 35.1% from the same period last year. Revenues from Visudyne were $20.6 million in the quarter, down 50.5% from the first quarter last year. QLT's share of profit from Visudyne sales decreased to 24.5% compared to 31.6% in the same period last year.

Research and Development (R&D) Expense

R&D expense in the first quarter was $11.1 million, down $3.3 million from R&D expense in the first quarter last year primarily due to decreased spending on Aczone, lemuteporfin and Atrigel projects.

Selling, General and Administrative (SG&A) Expense

For the first quarter of 2007, SG&A expense was $6.8 million, down $1.0 million from prior year first quarter expense, primarily due to decreased legal expenses associated with the TAP litigation.

Cash and Short-term Investments

The company's cash and short-term investments decreased from $378.1 million to $269.8 million during the first quarter of 2007 primarily due to QLT USA's $112.5 million portion of the TAP litigation settlement.

About QLT

QLT Inc. is a global biopharmaceutical company dedicated to the discovery, development and commercialization of innovative therapies. Our research and development efforts are focused on pharmaceutical products in the fields of ophthalmology and dermatology. In addition, we utilize two unique technology platforms, photodynamic therapy and Atrigel(R), to create products such as Visudyne(R) and Eligard(R). For more information, visit our web site at www.qltinc.com.

Updated Conference Call Information

QLT Inc. will hold an investor conference call to discuss first quarter 2007 results on Wednesday, April 25 at 8:30 a.m. ET (5:30 a.m. PT). The call will be broadcast live via the Internet at www.qltinc.com. To participate on the call, please dial 1-800-525-6384 (North America) or 780-409-1668 (International) before 8:30 a.m. ET. A replay of the call will be available via the Internet and also via telephone at 1-800-365-8354 (North America) or 402-220-2881 (International), access code 4498188.


    QLT Inc.-Financial Highlights

    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

    -----------------------------------------------

    (In accordance with United States generally

     accepted accounting principles)


                                                        Three months ended

    (In thousands of United States dollars, except           March 31,

     per share information)                             2007         2006

    -------------------------------------------------------------------------

    (Unaudited)

    Revenues

      Net product revenue                            $   25,116   $   46,805

      Net royalties                                       7,054        2,962

      Contract research and development                     248          401

      Licensing and milestones                              285          244

    -------------------------------------------------------------------------

                                                         32,703       50,412

    -------------------------------------------------------------------------


    Costs and expenses

      Cost of sales                                       8,719       10,181

      Research and development                           11,083       14,373

      Selling, general and administrative                 6,842        7,818

      Depreciation                                        1,584        1,512

      Restructuring charge                                  576           52

    -------------------------------------------------------------------------

                                                         28,804       33,936

    -------------------------------------------------------------------------


    Operating income                                      3,899       16,476


    Investment and other income (expense)

      Net foreign exchange gains (losses)                    25       (1,362)

      Interest income                                     3,904        4,617

      Interest expense                                   (1,582)      (1,594)

      Other gains                                         1,152            -

    -------------------------------------------------------------------------

                                                          3,499        1,661

    -------------------------------------------------------------------------


    Income from continuing operations before

     income taxes                                         7,398       18,137


    Provision for income taxes                           (2,535)      (5,483)


    -------------------------------------------------------------------------

    Income from continuing operations                     4,863       12,654

    -------------------------------------------------------------------------


    Loss from discontinued operations, net of

     income taxes                                             -         (521)


    -------------------------------------------------------------------------

    -------------------------------------------------------------------------

    Net income                                       $    4,863   $   12,133

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------


    Basic net income per common share

      Continuing operations                          $     0.06   $     0.14

      Discontinued operations                                 -        (0.01)

    -------------------------------------------------------------------------

      Net income                                     $     0.06   $     0.13


    Diluted net income per common share

      Continuing operations                          $     0.06   $     0.14

      Discontinued operations                                 -        (0.01)

    -------------------------------------------------------------------------

      Net income                                     $     0.06   $     0.13


    Weighted average number of common shares

     outstanding (in thousands)

      Basic                                              75,283       90,620

      Diluted                                            75,375       90,659

    -------------------------------------------------------------------------




    QLT Inc.

    CONDENSED CONSOLIDATED BALANCE SHEETS

    -------------------------------------

    (In accordance with United States generally

     accepted accounting principles)

                                                       March 31, December 31,

    (In thousands of United States dollars)              2007         2006

    -------------------------------------------------------------------------

    (Unaudited)

    ASSETS

    Current assets

      Cash and cash equivalents                      $  267,586   $  299,053

      Short-term investment securities                        -       75,163

      Restricted cash                                     2,227        3,916

      Accounts receivable                                30,775       38,872

      Income taxes receivable                             3,056        4,049

      Inventories                                        36,966       34,268

      Current portion of deferred income tax assets       8,660        8,657

      Other                                              16,709       14,031

    -------------------------------------------------------------------------

                                                        365,979      478,009

    -------------------------------------------------------------------------


    Property, plant and equipment                        50,318       50,497

    Deferred income tax assets                           10,878        9,838

    Goodwill                                             97,225       98,641

    Other long-term assets                                1,865        2,121

    -------------------------------------------------------------------------

                                                     $  526,265   $  639,106

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------


    LIABILITIES

    Current liabilities

      Accounts payable                               $   14,898   $   15,255

      Accrued liabilities                                 6,815      125,805

      Income taxes payable                                   40           29

      Accrued restructuring charge                        1,325        2,383

      Current portion of deferred revenue                 9,514       11,508

    -------------------------------------------------------------------------

                                                         32,592      154,980


    Deferred income tax liabilities                       5,835        5,483

    Uncertain tax position liability                      1,842            -

    Deferred revenue                                      2,685        2,929

    Long-term debt                                      172,500      172,500

    -------------------------------------------------------------------------

                                                        215,454      335,892

    -------------------------------------------------------------------------


    SHAREHOLDERS' EQUITY

    Common shares                                       710,046      708,206

    Additional paid in capital                          114,704      114,724

    Accumulated deficit                                (599,587)    (603,251)

    Accumulated other comprehensive income               85,648       83,535

    -------------------------------------------------------------------------

                                                        310,811      303,214

    -------------------------------------------------------------------------

                                                     $  526,265   $  639,106

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------


    As at March 31, 2007, there were 75,314,397 issued and outstanding common

    shares and 5,756,705 outstanding stock options.




    QLT Inc.

    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

    ----------------------------------------------

    2007 First Quarter Reconciliation of

     GAAP Earnings to Adjusted Non-GAAP

     Earnings                                                       Exhibit 1

    -------------------------------------------------------------------------

                                                                 Three months

                                       Three months                  ended

                                           ended                   March 31,

    (In millions of United States        March 31,                   2007

     dollars, except per share             2007                    Adjusted

     information)                          GAAP      Adjustments  Non-GAAP(1)

    -------------------------------------------------------------------------

    (Unaudited)

    Revenues

      Net product revenue               $     25.1   $        -   $     25.1

      Net royalties                            7.1            -          7.1

      Contract research and development        0.2            -          0.2

      Licensing and milestones                 0.3            -          0.3

    -------------------------------------------------------------------------

                                              32.7            -         32.7

    -------------------------------------------------------------------------

    Cost and expenses

      Cost of sales                           (8.7)         0.0(a)      (8.7)

      Research and development               (11.1)         0.6(a)     (10.5)

      Selling, general and

       administrative                         (6.8)         0.3(a)      (6.5)

      Depreciation                            (1.6)           -         (1.6)

      Restructuring charge                    (0.6)         0.6(b)         -

    -------------------------------------------------------------------------

                                             (28.8)         1.5        (27.3)

    -------------------------------------------------------------------------


    Operating income                           3.9          1.5          5.4


    Investment and other income

     (expense)

      Net foreign exchange gains               0.0            -          0.0

      Interest income                          3.9            -          3.9

      Interest expense                        (1.6)           -         (1.6)

      Other gains                              1.2            -          1.2

    -------------------------------------------------------------------------

                                               3.5            -          3.5


    Income before income taxes                 7.4          1.5          8.9


    Provision for income taxes                (2.5)        (0.2)(c)     (2.7)


    -------------------------------------------------------------------------

    Net income                          $      4.9   $      1.3   $      6.2

    -------------------------------------------------------------------------

    -------------------------------------------------------------------------


    Net income per common share:

      Basic                             $     0.06                $     0.08

      Diluted                                 0.06                      0.08


    Weighted average number of common

     shares outstanding (in millions)

      Basic                                   75.3                      75.3

      Diluted                                 75.4                      75.4


      Adjustments:

      (a)  Remove stock based compensation.

      (b)  Remove restructuring charge.

      (c)  Remove the income tax impact of (b).


      (1)  The adjusted non-GAAP financial measures have no standardized

           meaning under GAAP and are not comparable between companies.

           Management believes that the adjusted non-GAAP financial measures

           are useful for the purpose of financial analysis. Management uses

           these measures internally to evaluate the Company's operating

           performance before items that are considered by management to be

           outside of the Company's core operating results.


    Atrigel is a registered trademark of QLT USA, Inc.

    Visudyne is a registered trademark of Novartis AG.

    Eligard is a registered trademark of Sanofi-aventis.

QLT Inc. is listed on the NASDAQ Stock Market under the trading symbol "QLTI" and on The Toronto Stock Exchange under the trading symbol "QLT."

A full explanation of how QLT determines and recognizes revenue resulting from Visudyne sales is contained in the financial statements contained in the periodic reports on Forms 10-Q and 10-K, under the heading "Significant Accounting Policies - Revenue Recognition". Visudyne sales are product sales by Novartis under its agreement with QLT.

Certain statements in this press release constitute "forward looking statements" of QLT within the meaning of the Private Securities Litigation Reform Act of 1995 and constitute "forward looking information" within the meaning of the Securities Act (Ontario). Forward looking statements include, but are not limited to: our expectations regarding the future role of Visudyne and statements which contain language such as: "assuming," "prospects," "future," "projects," "expects" and "outlook". Forward-looking statements are predictions only which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from those expressed in such statements. Factors that could cause actual events or results to differ materially include, but are not limited to: the Company's future operating results are uncertain and likely to fluctuate, currency fluctuations in primary markets might impact financial results, the risk that future sales of Visudyne and Eligard may be less than expected (including as a result of the timing and impact of existing competitive products and/or new products launched by competitors and the level of physician acceptance of Visudyne in combination with other agents), the Company's reliance on third parties for the manufacture and marketing of Visudyne and Eligard, we are still involved in ongoing litigation and the cost of litigation can be unpredictable and may increase our 2007 SG&A expenses and adversely affect financial condition beyond what is currently expected; general economic conditions and other factors described in detail in QLT's Annual Information Form on Form 10 K, quarterly reports on Form 10 Q and other filings with the U.S. Securities and Exchange Commission and Canadian securities regulatory authorities. Forward looking statements are based on the current expectations of QLT and QLT does not assume any obligation to update such information to reflect later events or developments except as required by law.

CONTACT: QLT Inc.: Vancouver, Canada, Therese Hayes, Tamara Hicks, Telephone: (604) 707-7000, or 1-800-663-5486, Fax: (604) 707-7001

CONTACT: QLT Inc.: Vancouver, Canada, Therese Hayes, Tamara Hicks,Telephone: (604) 707-7000, or 1-800-663-5486, Fax: (604) 707-7001

Ticker Symbol: (Toronto:QLT.),(NASDAQ-NMS:QLTI)

Terms and conditions of use apply
Copyright © 2007 PR Newswire Association LLC. All rights reserved.
A United Business Media Company

Posted: April 2007


View comments

Hide
(web4)