Arena Pharmaceuticals Announces Second Consecutive Profitable Quarter With Sequential Quarterly Revenue Growth of 32% and Quarterly EPS of $0.05
SAN DIEGO, April 17 /PRNewswire/ -- Arena Pharmaceuticals, Inc. (Nasdaq: ARNA) today reported results for the quarter ended March 31, 2001. During the first quarter 2001, the Company's revenues increased by $1.3 million over the previous quarter to record revenues of $5.4 million versus no revenues for the first quarter of 2000. Revenues in the first quarter of 2001 were attributable to collaborations, which included research funding, milestone payments and technology access and development fees. The Company reported net income in the first quarter of 2001 of $1.1 million, or $.05 per share on a diluted basis. In the corresponding quarter of 2000, Arena reported a net loss, before a non-cash preferred stock charge, of $3.1 million or $.32 per share on a pro forma basis. The first quarter 2001 net income was reduced by non-cash charges related to amortization of deferred compensation of $1.3 million and amortization of goodwill and other intangibles of $128,000 relating to our acquisition of Bunsen Rush; excluding these non-cash charges, the first quarter 2001 net income was approximately $2.5 million, or $.11 per share on a diluted basis. Cash and cash equivalents totaled $125.5 million at March 31, 2001.
"The first quarter was both challenging and rewarding as we assembled key infrastructure elements to enable Project Genesis. We created our wholly-owned subsidiary BRL Screening, through the acquisition of Bunsen Rush to significantly expand our screening capability. We also signed deals with Taisho Pharmaceutical, Celera Genomics and Affymetrix," stated Jack Lief, Arena's President and CEO. Mr. Lief further noted that "Revenues increased by 32% over the most recent quarter while operating expenses increased by only 8%, and almost all of the operating expense increase was due to growth in our research spending. I am proud of our financial accomplishments, including net income of $.05 per share for the first quarter of 2001, even after the significant financial effect of declines in interest rates together with soaring energy costs, which could have an even greater effect for the entire year. I look forward to reporting continued progress in achieving our research goals while maintaining our profitable posture."
Arena's CART Technology allows for the direct identification of modulators of G protein-coupled receptors in a ligand-independent manner, making the technology particularly useful with respect to orphan GPCRs, which are estimated to comprise approximately 2% of the human genome. Such ligand-independent screening is made possible by genetic alteration of these receptors, using routinely applicable and proprietary genetic cassettes. Arena has recently initiated "Project Genesis," an internal program aimed at obtaining all of the human GPCRs, identifying the location of these receptors within normal and diseased tissue of the human body for purposes of understanding the function of such receptors, and screening each GPCR to identify receptor modulators that form the basis of drug candidates. Arena's CART Technology, in conjunction with Arena's recent acquisition of Bunsen Rush Laboratories, Inc. via Arena's wholly-owned subsidiary BRL Screening, Inc., and the recently announced genomics database subscription agreement with Celera Genomics, is intended to facilitate completion of Project Genesis within the next three to five years.
Certain statements in this press release are forward-looking statements that involve a number of risks and uncertainties, and actual events or results may differ materially from Arena's and BRL Screening, Inc.'s expectations. Statements that are not historical facts, including statements which are preceded by, followed by, or that include the words "intends," "will," "plans," "expects," "anticipates," "estimates," "aim" and "believes" or similar statements are forward-looking statements. Important factors that could cause actual results to differ materially from those stated or implied by our forward looking statements due to risks and uncertainties associated with Arena's and BRL's business include, but are not limited to, the following: the ability to complete Project Genesis, if at all, within a reasonable time period; future quarterly or annual financial results; the timing, success and cost of preclinical research, out-licensing endeavors and clinical studies, and receipt of additional milestone payments, if any, from collaborators. Additional risk factors that could cause actual results to differ materially from those in our forward looking statements are disclosed in Arena's SEC reports, including but not limited to Arena's Form S-1, most recent quarterly report on Form 10-Q, and most recent annual report on Form 10-K. These forward-looking statements represent Arena's judgment as of the date of this release. Arena and BRL disclaim, however, any intent or obligation to update these forward-looking statements.
Arena Pharmaceuticals, Inc. Condensed Consolidated Statement of Operations
Three months ended March 31, 2001 2000 (unaudited) (unaudited) Revenues $5,392,335 $ -- Operating expenses: Research and development 3,903,341 2,399,358 General and administrative 1,025,983 423,828 Amortization of non-cash deferred compensation 1,268,666 409,479 Amortization of goodwill and other intangibles 128,083 -- Total operating expenses 6,326,073 3,232,665 Interest and other income, net 2,018,732 110,465 Net income (loss) applicable to common stockholders 1,084,994 (3,122,200) Non-cash preferred stock charge -- (14,187,563) Net income (loss) applicable to common stockholders $1,084,994 $(17,309,763) Net income (loss) per share, basic $0.05 $(15.92) Shares used in calculating net income (loss) per share, basic 22,226,922 1,086,988 Net income (loss) per share, diluted $0.05 $(15.92) Shares used in calculating net income (loss) per share, diluted 23,202,193 1,086,988 Pro forma net loss per share $(1.76) Shares used in calculating pro forma net loss per share 9,827,102
|Note:||The loss per share on a pro forma basis assumes the conversion of|
|the redeemable preferred stock into common stock as of the date of|
|issuance. The redeemable preferred stock converted into common stock at|
|the closing of the Company's initial public offering on a one-for-one|
Condensed Consolidated Balance Sheet Data: March 31, December 31, 2001 2000 (unaudited) Assets Cash and cash equivalents $125,503,323 $144,413,176 Accounts receivable and other current assets 3,477,584 3,040,328 Property and equipment, net 12,219,879 4,265,260 Goodwill and other assets 15,420,372 993,165 Total assets $156,621,158 $152,711,929 Liabilities and Stockholders' Equity Liabilities $5,443,538 $3,927,604 Stockholders' equity 151,177,620 148,784,325 Total liabilities and stockholders' equity $156,621,158 $152,711,929
"Arena Pharmaceuticals" and the corporate logo are registered U.S. trademarks of the Company. "Arena", "CART" and "BRL Screening" are trademarks of the Company. Arena's headquarters are located at 6166 Nancy Ridge Drive, San Diego, CA 92121. Arena's telephone number is (858) 453-7200. On the Internet, please refer to the Investor Relations Center at Arena's website: http://www.arenapharm.com for further information.
For further information, contact:
Jack Lief, President & CEO: Extension 223
Joseph Mooney, CFO: Extension 8-508 SOURCE Arena Pharmaceuticals
CONTACT: Jack Lief, President & CEO, ext. 223, or Joseph Mooney, CFO, ext. 8-508, of Arena Pharmaceuticals, 858-453-7200/