EX-99 3 ex99-1.txt PRESS RELEASE WEDNESDAY FEBRUARY 27, 7:01 AM EASTERN TIME PRESS RELEASE SOURCE: ICN Pharmaceuticals, Inc. Investors: Media: --------- ----- Joe Schepers Peter Murphy 212-754-4422 714-545-0100, ext. 3213 ICN PHARMACEUTICALS REPORTS RECORD FOURTH QUARTER AND RECORD YEAR - RECORD REVENUE Q4 AND FULL YEAR - - RECORD OPERATING INCOME Q4 - - RECORD PRE-TAX INCOME Q4 AND FULL YEAR - - RECORD ROYALTY Q4 - COSTA MESA, Calif., February 27, 2002 -- ICN Pharmaceuticals, Inc. (NYSE: ICN) today announced record revenues for the fourth quarter and the year 2001. During the fourth quarter, the company achieved the highest level of revenues and pre-tax income in any quarter of the company's history. For the fourth quarter, revenues were a record $262.3 million, compared to $209.2 million in 2000, an increase of 25%. Operating income in the fourth quarter was a record $77.6 million compared to $19.2 million in 2000, an increase of 303%. This represents an increase in operating income in the specialty pharmaceutical business of $38.8 million and a $19.5 million increase in the royalty revenue, net of the increase in R & D expenses of $4.5 million. Pre-tax income was a record $63.4 million, a significant increase from $6.3 million a year earlier. Net income in the fourth quarter was $33.5 million compared to a loss of $4.9 million in the fourth quarter of 2000. Earnings per diluted share before an extraordinary item (related to the company's previously announced restructuring plan) for the fourth quarter were $0.40, compared to a loss of $0.02 per share in the fourth quarter of 2000. For the year 2001, ICN posted record revenue of $858.1 million compared to $800.3 million a year ago, up 7 %. Operating income in 2001 was $189.3 million compared to $184.0 million in 2000, up 3%. Pre-tax income for the year was a record $144.4 million, compared to $129.6 million in 2000, an increase of 11%. Income for 2001 before an extraordinary loss due to repurchase of debt (due to the restructuring plan) was $85.2 million compared to $93.4 million in 2000 and earnings per diluted share before extraordinary loss were $1.02 for 2001 compared to $1.14 in 2000. EBITDA was $260 million in 2001. Stockholders' equity rose to $803 million in 2001 from $757 million in 2000. During the year, the company repurchased and redeemed an aggregate of $308 million of its 9 1/4% and 8 3/4% senior notes, resulting in an extraordinary charge of $21.1 million net of taxes. Fourth quarter royalties for ribavirin improved to $54 million in 2001, following the launch by Schering-Plough Corporation of pegylated interferon/ribavirin combination treatment in October 2001. Schering-Plough markets ICN's ribavirin in the U.S. and Europe under the brand name Rebetol(R) for use in combination with its IntronA(R) or Peg Intron(R) to treat chronic hepatitis C. Schering-Plough also launched Rebetol/IntronA(R) combination therapy in Japan in December 2001. Royalties from ribavirin in 2001 were $137.0 million, down from $155.1 million in 2000, reflecting the warehousing of patients as physicians awaited the availability of pegylated interferon/ribavirin combination treatment. ICN Americas North America Total North American Pharmaceutical sales were $173.7 million in 2001, compared to $120.6 million in 2000, an increase of 44%. Operating income for the year was $68.2 million as compared to $47.9 million the prior year, an increase of 42%. Results benefited from the introduction of the NLite(TM) laser system, a non-ablative general wrinkle reduction laser. In addition, ICN North America has hired a team of marketing personnel to oversee an enhanced drive to increase sales of ICN skin care and cosmetic treatments. Latin America Latin American sales remained relatively flat at $128.2 million in 2001 compared to $127.5 million in 2000. Operating income in 2001 was $40.8 million compared to $42.0 million in 2000. Operations saw the introduction of 5 new products in Mexico and 4 new products in Brazil. In Argentina, ICN acquired a line of 69 dermatological products and 16 ophthalmological products. ICN International ICN's International operations are now headquartered in Basel, Switzerland. ICN has assembled a team of seasoned executives recruited from industry giants, such as Roche and Novartis, to lead the international expansion. Western Europe Sales in Western Europe were $206.4 million in 2001 compared to $187.2 million in 2000, an increase of 10%. Operating income was $26.4 million versus $16.4 million in 2000, an increase of 61%. Western European results benefited from strong performance in Mestinon(R) sales throughout the region, as well as by improvements at the company's subsidiary in Poland, where sales grew by 47%, fueled by the introduction of new products and increased market penetration through an enlarged sales force and new marketing organization. Operating income in Poland increased from $3.4 million in 2000 to $9.2 million in 2001. Western European sales also benefited from the sales of Spain-based Nuclosina(R), which generated $12.7 million in sales in 2001. Operating income in Spain increased 11% to $7.0 million. Eastern Europe Eastern European sales for the year were $103.1 million in 2001, down from $106.3 million in 2000. The region reported an operating loss of $5.9 million for 2001 compared to an operating loss of $3.9 million in 2000. In 2001, the company increased investments in marketing and advertising. ICN Russia successfully completed its expansion into nine important regional markets across the country. In the most important market, Moscow, ICN has become the single largest pharmacy retailer with over 100 retail outlets. The fourth quarter of 2001 was Russia's first profitable quarter, since the first quarter of 2000, with $1.6 million in operating profit compared to an operating loss of $1.2 million, in 2000. Asia, Australia, Africa Sales in Asia, Australia and Africa were $49.8 million compared to $45.1 million in 2000, an increase of 10%. The company posted an operating profit of $5.3 million compared to a $0.5 million loss in 2000. In the fourth quarter, AAA pharmaceutical sales reached $13.7 million, which was 57% more than the same quarter for the prior year. This success is attributable to improvements in the ICN international supply chain. In 2001, ICN continued to develop and consolidate its own marketing and sales infrastructure in the major markets in this vast region. ICN's own organizations are operational in Australia, Philippines, Taiwan, Singapore, United Arab Emirates, Saudi Arabia and Egypt. The best results were achieved in Australia, where an ICN subsidiary, taking over marketing and sales from distributors and other partners, achieved sales of $7.4 million for 2001. Research and Development Research and development expenses increased 62% from $18.8 million in 2000 to $30.5 million in 2001. Total research and development spending for 2001 was $52.7 million, which included capital improvements for new equipment and facilities. The company noted that as a result of its increased R&D efforts, an Investigational New Drug Application (IND) had been filed in December 2001 for Viramidine(TM), a nucleoside analog. At the time the IND takes effect, the company plans to initiate Phase I trials of in subjects with chronic hepatitis C to address the safety and efficacy of Viramidine(TM). To further expand the antiviral pipeline, ICN in-licensed a compound being developed for the treatment of chronic hepatitis B. Also during 2001, the company acquired more than 70,000 diverse non-nucleoside analog compounds to complement its existing nucleoside library. Milan Panic, chairman and chief executive officer, stated, "We have turned the corner with respect to Rebetol(R) sales. Royalties were a record for the fourth quarter in the United States and abroad. The royalties from the fourth quarter surpass any prior quarter in the company's history." Mr. Panic added, "Our higher Sales and Marketing expenses indicate how aggressive we are in moving into niche markets in the specialty pharmaceuticals business. Despite the increased sales and marketing activities, overall G & A is down, reflecting increased efficiencies." ICN is an innovative, research-based global pharmaceutical company that manufactures, markets and distributes a broad range of prescription and non-prescription pharmaceuticals under the ICN brand name. Its therapeutic focus is on anti-infectives, including anti-virals, dermatology and oncology. Additional information is also available on the Company's website at http://www.icnpharm.com . THE SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. This press release contains forward-looking statements that involve risks and uncertainties, including but not limited to, projections of future sales, operating income, returns on invested assets, regulatory approval processes, and other risks detailed from time to time in the Company's Securities and Exchange Commission filings. Consolidated Condensed Statement of Income for the three and twelve months ended December 31, 2001 and 2000
Three Months Ended Twelve Months Ended December 31, December 31, ------------------------------------------------------------------ In thousands, except per share data 2001 2000 2001 2000 -------------- -------------- --------------- -------------- Total revenues: $ 262,304 $ 209,189 $ 858,104 $ 800,304 -------------- -------------- --------------- -------------- Product sales 208,303 179,177 721,115 645,190 Royalties 54,001 30,012 136,989 155,114 Cost of product sales 81,321 76,887 285,736 262,818 Selling, general and administrative expenses 84,626 99,285 320,472 304,314 Research and development costs 10,707 6,205 30,474 18,769 Amortization of goodwill and intangibles 8,078 7,585 32,084 30,448 -------------- -------------- --------------- -------------- 184,732 189,962 668,766 616,349 -------------- -------------- --------------- -------------- Income from operations 77,572 19,227 189,338 183,955 Interest, net 12,359 10,893 46,149 47,814 Other (income) loss, net including translation and exchange 1,825 2,040 (1,168) 6,587 -------------- -------------- --------------- -------------- Income before provision for income taxes, minority interest and extraordinary loss 63,388 6,294 144,357 129,554 Provision for income taxes 30,151 8,096 58,609 37,683 Minority interest (308) (106) 548 (1,534) -------------- -------------- --------------- -------------- Income (loss) before extraordinary loss 33,545 (1,696) 85,200 93,405 Extraordinary loss, net of tax - 3,225 21,066 3,225 -------------- -------------- --------------- -------------- Net income (loss) $ 33,545 $ (4,921) $ 64,134 $ 90,180 ============== ============== =============== ============== Basic earnings per common share Income (loss) before extraordinary loss $ 0.41 $ (0.02) $ 1.05 $ 1.18 Extraordinary loss * - (0.04) (0.26) (0.04) -------------- -------------- --------------- -------------- Net income (loss) $ 0.41 $ (0.06) $ 0.79 $ 1.14 ============== ============== =============== ============== Shares used in per share computation 81,641 79,976 81,124 79,395 ============== ============== =============== ============== Diluted earnings per common share Income (loss) before extraordinary loss $ 0.40 $ (0.02) $ 1.02 $ 1.14 Extraordinary loss * - (0.04) (0.25) (0.04) -------------- -------------- --------------- -------------- Net income (loss) $ 0.40 $ (0.06) $ 0.77 $ 1.10 ============== ============== =============== ============== Shares used in per share computation 98,869 79,976 83,166 82,264 ============== ============== =============== ============== * Repurchased debt related to restructuring.