8-K
REPLIGEN CORP (RGEN)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 20, 2020
REPLIGEN CORPORATION
(Exact name of registrant as specified in its charter)
| Delaware | 001-14656 | 04-2729386 |
|---|---|---|
| (State or other jurisdiction<br> <br>of incorporation) | (Commission<br> <br>File Number) | (I.R.S. Employer<br> <br>Identification No.) |
41 Seyon Street, Bldg. 1, Suite 100, Waltham, MA 02453
(Address of principal executive offices, including zip code)
(781) 250-0111
(Registrant’s telephone number, including area code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br> <br>Symbol(s) | Name of each exchange<br> <br>on which registered |
|---|---|---|
| Common Stock, par value $0.01 per share | RGEN | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02. | Results of Operations and Financial Condition. |
|---|
On February 20, 2020, Repligen Corporation announced its financial results for the fourth quarter and year ended December 31, 2019. The full text of the press release issued in connection with the announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K.
The information in this Form 8-K and the exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
| Item 9.01. | Financial Statements and Exhibits. |
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(d) Exhibits
| 99.1 | Press Release by Repligen Corporation, dated February 20, 2020 |
|---|---|
| 104 | Cover page from this Current Report on Form 8-K, formatted in Inline XBRL |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| REPLIGEN CORPORATION | ||
|---|---|---|
| Date: February 20, 2020 | By: | /s/ Tony J. Hunt |
| Tony J. Hunt | ||
| President and Chief Executive Officer |
EX-99.1
Exhibit 99.1
| Repligen Corporation |
|---|
| 41 Seyon Street |
| Building #1, Suite 100 |
| Waltham, Massachusetts 02453 |
Repligen Reports Fourth Quarter and Full Year 2019 Financial Results
| • | Reports quarterly revenue of $69.5 million, representing 34% year-over-year growth, andannual revenue of $270.2 million represents 39% year-over-year growth |
|---|---|
| • | Overall organic revenue growth was 21% for the fourth quarter and 33% for the year 2019<br> |
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WALTHAM, Mass. – Feb. 20, 2020 — Repligen Corporation (NASDAQ:RGEN), a life sciences company focused on bioprocessing technology leadership, today reported financial results for its fourth quarter and full year 2019. Provided in this press release are financial highlights for the three - and twelve-month periods ended December 31, 2019, followed by our current financial guidance for the year 2020, and access information for today’s webcast and conference call.
Tony J. Hunt, President and Chief Executive Officer said, “We are delighted with the way we finished off 2019 with 21% organic growth in the fourth quarter and 33% for the full year. Our Filtration and Chromatography franchises accelerated in 2019 as we expanded our market presence as customers scaled these technologies into late stage processes. We also captured greater share in gene therapy manufacturing where sales more than doubled in 2019 to 15% of total revenue. Strategically, our acquisition of C Technologies established an important new Process Analytics franchise that delivered over $16M in the first 7 months of ownership. We anticipate that 2020 will be another positive year for the company as we continue to bring on additional manufacturing capacity, launch exciting new products and deliver on strong organic growth and earnings to our shareholders.”
Fourth Quarter 2019 Highlights
| • | Revenue increased by 34% year-over-year as reported (35% at constant currency), to$69.5 million |
|---|---|
| • | Organic revenue growth was 21% |
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| • | GAAP fully diluted EPS was $0.07 compared to $0.12 for the fourth quarter of 2018 |
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| • | Adjusted (non-GAAP) fully diluted EPS increased to $0.20 compared to$0.19 for the fourth quarter of 2018 |
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Full Year 2019 Highlights
| • | Revenue increased by 39% year-over-year (41% at constant currency), to $270.2 million <br> |
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| • | Organic revenue growth was 33% |
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| • | GAAP fully diluted EPS increased to $0.44 compared to $0.37 for the year 2018 |
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| • | Adjusted (non-GAAP) fully diluted EPS increased to $1.07 compared to$0.66 for the year 2018 |
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Financial Details for the Fourth Quarter and Full Year 2019
REVENUE
| • | Total revenue for the fourth quarter of 2019 increased to $69.5 million compared to $51.9 million for<br>the fourth quarter of 2018, a year-over-year gain of 34% as reported and 35% at constant currency, with organic growth of 21%. |
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| • | Total revenue for the full year 2019 increased to $270.2 million compared to $194.0 million for the<br>full year 2018, a year-over-year gain of 39% as reported and 41% at constant currency, with organic growth of 33%. |
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GROSS PROFIT and GROSS MARGIN
| • | Gross profit (GAAP) for the fourth quarter of 2019 was $39.4 million, a year-over-year increase of<br>$11.0 million. Adjusted gross profit (non-GAAP) for the fourth quarter of 2019 was $39.8 million, a year-over-year increase of $11.3 million. |
|---|---|
| • | Gross margin (GAAP) for the fourth quarter of 2019 was 56.6%, a 210 bps improvement from the fourth quarter of<br>2018. Adjusted gross margin (non-GAAP) for the fourth quarter of 2019 was 57.2%, a 240 bps improvement compared to the 2018 period. |
| --- | --- |
| • | Gross profit (GAAP) for the full year 2019 was $151.1 million, a year-over-year increase of<br>$43.6 million. Adjusted gross profit (non-GAAP) for the full year 2019 was $154.1 million, a year-over-year increase of $45.9 million. |
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| • | Gross margin (GAAP) for the full year 2019 was 55.9%, a 50 bps improvement from the full year 2018. Adjusted<br>gross margin (non-GAAP) for the full year 2019 was 57.0%, a 120 bps improvement from the full year 2018. |
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OPERATING INCOME
| • | Operating income (GAAP) for the fourth quarter of 2019 was $5.9 million compared to $7.9 million for<br>the fourth quarter of 2018. Adjusted operating income (non-GAAP) for the fourth quarter of 2019 was $12.7 million, an increase of 15% compared to $11.1 million for the fourth quarter of 2018.<br> |
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| • | Operating income (GAAP) for the full year 2019 was $36.1 million, an increase of 39% compared to<br>$26.0 million for the full year 2018. Adjusted operating income (non-GAAP) for the full year 2019 was $63.5 million, an increase of 61% compared to $39.4 million for the full year 2018.<br> |
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NET INCOME
| • | Net income (GAAP) for the fourth quarter of 2019 was $3.6 million compared to $5.6 million for the<br>fourth quarter of 2018. Adjusted net income (non-GAAP) for the fourth quarter of 2019 was to $10.8 million, an increase of 21% compared to $8.9 million for the fourth quarter of 2018.<br> |
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| • | Net income (GAAP) for the full year 2019 was $21.4 million, an increase of 29% compared to<br>$16.6 million for the full year 2018. Adjusted net income (non-GAAP) for the full year 2019 was $52.5 million, an increase of 74% compared to $30.1 million for the full year 2018.<br> |
| --- | --- |
EARNINGS PER SHARE
| • | Earnings per share (GAAP) for the fourth quarter of 2019 were $0.07 on a fully diluted basis, compared to $0.12<br>for the fourth quarter of 2018. Adjusted EPS (non-GAAP) for the fourth quarter of 2019 increased to $0.20 on a fully diluted basis, compared to $0.19 for the 2018 period. |
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| • | Earnings per share (GAAP) for the full year 2019 increased to $0.44 on a fully diluted basis, compared to $0.37<br>for the full year 2018. Adjusted EPS (non-GAAP) for the full year 2019 increased to $1.07 on a fully diluted basis, compared to $0.66 for the full year 2018. |
| --- | --- |
EBITDA
| • | EBITDA, a non-GAAP financial measure, for the fourth quarter of 2019 was<br>$11.7 million compared to $11.9 million for the fourth quarter of 2018. Adjusted EBITDA for the fourth quarter of 2019 was $14.6 million, an increase of 17% compared to $12.5 million for the fourth quarter of 2018.<br> |
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| • | EBITDA for the full year 2019 was $51.0 million, an increase of 21% compared to $42.0 million for the<br>full year 2018. Adjusted EBITDA for the full year 2019 was $71.1 million, an increase of 58% compared to $45.0 million for the full year 2018. |
| --- | --- |
CASH
| • | Our cash and cash equivalents at December 31, 2019 were $528.4 million, an increase of<br>$334.6 million from $193.8 million at December 31, 2018. |
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All reconciliations of GAAP to adjusted (non-GAAP) figures above, as well as EBITDA to adjusted EBITDA, are detailed in the reconciliation tables included later in this press release.
Financial Guidance for 2020
Our financial guidance for the fiscal year 2020 is based on expectations for our existing business and includes the financial impact of our acquisition of C Technologies (which closed on May 31, 2019). The guidance below excludes the impact of potential additional acquisitions and future fluctuations in foreign currency exchange rates.
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FISCAL YEAR 2020 GUIDANCE:
| • | Total revenue is projected to be in the range of $309-$319 million,<br>reflecting overall revenue growth of 14%-18% as reported and at constant currency and organic growth of 10%-14%. |
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| • | Gross margin is expected to be 55%-56% on both a GAAP and non-GAAP basis. |
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| • | Income from operations is expected to be in the range of<br>$50-$54 million on a GAAP basis. Adjusted (non-GAAP) income from operations is expected to be in the range of<br>$70-$74 million. |
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| • | Net income is expected to be in the range of $33.5-$36.5 million on<br>a GAAP basis. Adjusted (non-GAAP) net income is expected to be in the range of $57-$60 million. Our current guidance reflects a tax rate of 23% on adjusted pre-tax income. |
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| • | Fully diluted GAAP EPS is expected to be in the range of $0.63-$0.68.<br>Adjusted (non-GAAP) fully diluted EPS is expected to be in the range of $1.07-$1.12. |
| --- | --- |
Our non-GAAP guidance for the fiscal year 2020 excludes the following items:
| • | $4.8 million estimated acquisition and integration expenses; $0.5 million in cost of product revenue,<br>$0.5 million in R&D and $3.8 million in SG&A. |
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| • | $15.5 million estimated intangible amortization expense; $0.3 million in cost of product revenue and<br>$15.1 million in G&A. |
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| • | $11.0 million of non-cash interest expense (Other income (expense))<br>related to our convertible debt notes. |
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Our non-GAAP guidance for the fiscal year 2020 includes:
| • | An income tax increase of $7.6 million, representing the tax impact of acquisition and integration costs,<br>intangible amortization and non-cash interest. |
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All reconciliations of GAAP to adjusted (non-GAAP) guidance are detailed in the tables included later in this press release.
Conference Call
Repligen will host a conference call and webcast today, February 20, 2020, at 8:30 a.m. EST, to discuss fourth quarter and full year 2019 financial results and corporate developments. The conference call will be accessible by dialing toll-free (844) 701-1063 for domestic callers or (412) 317-5487 for international callers. No passcode is required for the live call. In addition, a webcast will be accessible via the Investor Relations section of the Company’s website. Both the conference call and webcast will be archived for a period of time following the live event. The replay dial-in numbers are (877) 344-7529 from the U.S., (855) 669-9658 from Canada and (412) 317-0088 for international callers. Replay listeners must provide the passcode 10137263.
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Non-GAAP Measures of Financial Performance
To supplement our financial statements, which are presented on the basis of U.S. generally accepted accounting principles (GAAP), the following non-GAAP measures of financial performance are included in this release: revenue growth rate at constant currency, adjusted gross profit and adjusted gross margin, adjusted income from operations, earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA, adjusted net income, adjusted net income per share, adjusted earnings per diluted share (EPS), adjusted cost of sales, adjusted research & development expense, and adjusted selling, general and administrative expense. The Company provides organic revenue growth rates in constant currency to exclude the impact of both foreign currency translation, and the impact of acquisition revenue for current year periods that have no prior year comparable, in order to facilitate a comparison of its current revenue performance to its past revenue performance. The Company provides revenue growth rates in constant currency in order to facilitate a comparison of its current revenue performance to its past revenue performance. To calculate revenue growth rates in constant currency, the Company converts actual net sales from local currency to U.S. dollars using constant foreign currency exchange rates in the current and prior period.
The Company’s non-GAAP financial results and/or non-GAAP guidance exclude the impact of: acquisition and integration costs related to the Company’s acquisitions of Spectrum Lifesciences, LLC (formerly known as Spectrum, Inc.), and C Technologies Inc.; intangible amortization costs; non-cash interest expense; the impact on tax of intangible amortization and acquisition costs; and, in the case of EBITDA, cash interest expense related to the Company’s convertible debt. These costs are excluded because management believes that such expenses do not have a direct correlation to future business operations, nor do the resulting charges recorded accurately reflect the performance of our ongoing operations for the period in which such charges are recorded.
A reconciliation of GAAP to adjusted non-GAAPfinancial measures is included as an attachment to this press release. When analyzing the Company’s operating performance and guidance investors should not consider non-GAAP measures as substitutable forthe comparable financial measures prepared in accordance with GAAP.
About Repligen Corporation
Repligen Corporation is a global life sciences company that develops and commercializes highly innovative bioprocessing technologies and systems that increase efficiencies in the process of manufacturing biological drugs. We are inspiring advances in bioprocessing for the customers we serve; primarily biopharmaceutical drug developers and contract development and manufacturing organizations (CDMOs) worldwide. Our corporate headquarters are located in Waltham, MA (USA), and we have additional administrative and manufacturing operations in Marlborough, MA; Bridgewater, NJ; Rancho Dominguez, CA; Lund, Sweden; Breda, The Netherlands and Ravensburg, Germany.
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The following constitutes a “Safe Harbor” statement under the Private Securities LitigationReform Act of 1995: This press release contains forward-looking statements, which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of1934, as amended. Investors are cautioned that statements in this press release which are not strictly historical statements, including, without limitation, express or implied statements or guidance regarding current or future financial performanceand position, including cash and investment position, demand in the markets in which we operate, the expected performance of our business, the expected performance of the C Technologies business, the expected performance and success of our strategicpartnerships, management’s strategy, plans and objectives for future operations or acquisitions, product development and sales, selling, general and administrative expenditures, intellectual property, development and manufacturing plans,availability of materials and product and adequacy of capital resources and financing plans constitute forward-looking statements identified by words like “believe,” “expect,” “may,” “will,”“should,” “seek,” “anticipate,” or “could” and similar expressions. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially fromthose anticipated, including, without limitation, risks associated with: our ability to successfully grow our bioprocessing business, including as a result of acquisition, commercialization or partnership opportunities; our ability to successfullyintegrate any acquisitions, our ability to develop and commercialize products and the market acceptance of our products; our ability to integrate the C Technologies business successfully into our business and achieve the expected benefits of theacquisition; reduced demand for our products that adversely impacts our future revenues, cash flows, results of operations and financial condition; our ability to compete with larger, better financed bioprocessing, pharmaceutical and biotechnologycompanies; our compliance with all U.S. Food and Drug Administration and EMEA regulations; our volatile stock price; and other risks detailed in Repligen’s most recent Annual Report on Form 10-K on filewith the Securities and Exchange Commission and the other reports that Repligen periodically files with the Securities and Exchange Commission. Actual results may differ materially from those Repligen contemplated by these forward-lookingstatements. These forward looking statements reflect management’s current views and Repligen does not undertake to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after thedate hereof except as required by law.
Repligen Contact:
Sondra S. Newman
Global Head of Investor Relations
(781) 419-1881
investors@repligen.com
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REPLIGEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, amounts in thousands, except share and per share data)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| Revenue: | ||||||||||||
| Product revenue | $ | 69,396 | $ | 51,849 | $ | 270,097 | $ | 193,891 | ||||
| Royalty and other revenue | 78 | 93 | 148 | 141 | ||||||||
| Total revenue | 69,474 | 51,942 | 270,245 | 194,032 | ||||||||
| Costs and expenses: | ||||||||||||
| Cost of product revenue | 30,121 | 23,592 | 119,099 | 86,531 | ||||||||
| Research and development | 5,172 | 3,152 | 19,450 | 15,821 | ||||||||
| Selling, general and administrative | 28,287 | 17,345 | 95,613 | 65,692 | ||||||||
| 63,580 | 44,089 | 234,162 | 168,044 | |||||||||
| Income from operations | 5,894 | 7,853 | 36,083 | 25,988 | ||||||||
| Investment income | 1,708 | 644 | 5,324 | 1,895 | ||||||||
| Loss on extinguishment of debt | — | — | (5,650 | ) | — | |||||||
| Interest expense | (2,966 | ) | (1,701 | ) | (9,292 | ) | (6,709 | ) | ||||
| Other (expenses) income, net | (291 | ) | 75 | (314 | ) | 262 | ||||||
| Income before income taxes | 4,345 | 6,871 | 26,151 | 21,436 | ||||||||
| Income tax provision | 741 | 1,233 | 4,740 | 4,819 | ||||||||
| Net income | $ | 3,604 | $ | 5,638 | $ | 21,411 | $ | 16,617 | ||||
| Earnings per share: | ||||||||||||
| Basic | $ | 0.07 | $ | 0.13 | $ | 0.44 | $ | 0.38 | ||||
| Diluted | $ | 0.07 | $ | 0.12 | $ | 0.44 | $ | 0.37 | ||||
| Weighted average shares outstanding: | ||||||||||||
| Basic | 52,063,528 | 43,881,151 | 48,342,584 | 43,767,402 | ||||||||
| Diluted | 52,976,271 | 46,291,014 | 49,206,242 | 45,471,169 | ||||||||
| December 31,2019 | December 31,2018 | |||||||||||
| --- | --- | --- | --- | --- | --- | |||||||
| Balance Sheet Data: | ||||||||||||
| Cash and cash equivalents | $ | 528,392 | $ | 193,822 | ||||||||
| Working capital | 593,515 | 145,897 | ||||||||||
| Total assets | 1,400,113 | 774,621 | ||||||||||
| Long-term obligations | 292,032 | 29,211 | ||||||||||
| Accumulated earnings (deficit) | 5,843 | (15,568 | ) | |||||||||
| Stockholders’ equity | 1,059,768 | 615,568 |
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REPLIGEN CORPORATION
RECONCILIATION OF GAAP INCOME FROM OPERATIONS TO
NON-GAAP (ADJUSTED) INCOME FROM OPERATIONS
(Unaudited, amounts in thousands)
| Three Months EndedDecember 31, | Twelve MonthsEnded December 31, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||
| GAAP INCOME FROM OPERATIONS | $ | 5,894 | $ | 7,853 | $ | 36,083 | $ | 25,988 |
| ADJUSTMENTS TO INCOME FROM OPERATIONS: | ||||||||
| Acquisition and integration costs | 2,934 | 615 | 12,508 | 2,928 | ||||
| Intangible amortization | 3,879 | 2,612 | 13,441 | 10,518 | ||||
| Inventory step-up charges | — | — | 1,483 | — | ||||
| ADJUSTED INCOME FROM OPERATIONS | $ | 12,707 | $ | 11,080 | $ | 63,515 | $ | 39,434 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP (ADJUSTED) NET INCOME
(Unaudited, amounts in thousands)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| GAAP NET INCOME | $ | 3,604 | $ | 5,638 | $ | 21,411 | $ | 16,617 | ||||
| ADJUSTMENTS TO NET INCOME: | ||||||||||||
| Acquisition and integration costs | 2,934 | 615 | 13,008 | 2,928 | ||||||||
| Inventory step-up charges | — | — | 1,483 | — | ||||||||
| Intangible amortization | 3,879 | 2,612 | 13,441 | 10,518 | ||||||||
| Loss on extinguishment of debt | — | — | 5,650 | — | ||||||||
| Non-cash interest expense | 2,674 | 1,088 | 7,536 | 4,248 | ||||||||
| Tax effect of intangible amortization and acquisition costs^(1)^ | (2,261 | ) | (1,033 | ) | (10,003 | ) | (4,204 | ) | ||||
| ADJUSTED NET INCOME | $ | 10,830 | $ | 8,920 | $ | 52,526 | $ | 30,107 | ||||
| (1) | Effective as of the quarter ended September 30, 2019, the Company changed its methodology for calculating<br>its non-GAAP financial measures to reflect the tax effect of non-cash interest. Accordingly, the non-GAAP financial measures for<br>the three and twelve months ended December 31, 2018 have been updated to be consistent with the methodology used to calculate such measures for the current periods. | |||||||||||
| --- | --- |
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REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME PER SHARE TO
NON-GAAP (ADJUSTED) NET INCOME PER SHARE
(Unaudited)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| GAAP NET INCOME PER SHARE - DILUTED | $ | 0.07 | $ | 0.12 | $ | 0.44 | $ | 0.37 | ||||
| ADJUSTMENTS TO NET INCOME PER SHARE - DILUTED: | ||||||||||||
| Acquisition and integration costs | 0.06 | 0.01 | 0.26 | $ | 0.06 | |||||||
| Inventory step-up charges | — | — | 0.03 | $ | — | |||||||
| Intangible amortization | 0.07 | 0.06 | 0.27 | $ | 0.23 | |||||||
| Loss on extinguishment of debt | — | — | 0.11 | $ | — | |||||||
| Non-cash interest expense | 0.05 | 0.02 | 0.15 | $ | 0.09 | |||||||
| Tax effect of intangible amortization and acquisition costs^(1)^ | (0.04 | ) | (0.02 | ) | (0.20 | ) | $ | (0.09 | ) | |||
| ADJUSTED NET INCOME PER SHARE - DILUTED | $ | 0.20 | $ | 0.19 | $ | 1.07 | $ | 0.66 |
Totals may not add due to rounding.
| (1) | Effective as of the quarter ended September 30, 2019, the Company changed its methodology for calculating<br>its non-GAAP financial measures to reflect the tax effect of non-cash interest. Accordingly, the non-GAAP financial measures for<br>the three and twelve months ended December 31, 2018 have been updated to be consistent with the methodology used to calculate such measures for the current periods. |
|---|
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA
(Unaudited, amounts in thousands)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| GAAP NET INCOME | $ | 3,604 | $ | 5,638 | $ | 21,411 | $ | 16,617 | ||||
| ADJUSTMENTS: | ||||||||||||
| Investment Income | (1,708 | ) | (644 | ) | (5,324 | ) | (1,895 | ) | ||||
| Interest Expense | 2,966 | 1,701 | 9,292 | 6,709 | ||||||||
| Tax Provision | 741 | 1,233 | 4,740 | 4,819 | ||||||||
| Depreciation | 2,170 | 1,305 | 7,317 | 5,213 | ||||||||
| Amortization^(1)^ | 3,907 | 2,659 | 13,551 | 10,565 | ||||||||
| EBITDA | 11,680 | 11,892 | 50,987 | 42,028 | ||||||||
| OTHER ADJUSTMENTS: | ||||||||||||
| Acquisition and integration costs | 2,934 | 615 | 13,008 | 2,928 | ||||||||
| Loss on extinguishment of debt | — | — | 5,650 | — | ||||||||
| Inventory step-up charges | — | — | 1,483 | — | ||||||||
| ADJUSTED EBITDA | $ | 14,614 | $ | 12,507 | $ | 71,128 | $ | 44,956 | ||||
| (1) | Fiscal 2019 includes amortization of milestone payments in accordance with GAAP of $28 and $111 for the three-<br>and twelve-month periods, respectively. | |||||||||||
| --- | --- |
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REPLIGEN CORPORATION
RECONCILIATION OF GAAP COST OF SALES TO NON-GAAP (ADJUSTED) COST OF SALES
(Unaudited, amounts in thousands)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018 | 2019 | 2018 | |||||||||
| GAAP COST OF SALES | $ | 30,121 | $ | 23,592 | $ | 119,099 | $ | 86,531 | ||||
| ADJUSTMENT TO COST OF SALES: | ||||||||||||
| Acquisition and integration costs | (281 | ) | 8 | (951 | ) | (162 | ) | |||||
| Inventory step-up charges | — | — | (1,483 | ) | — | |||||||
| Intangible amortization | (128 | ) | (135 | ) | (520 | ) | (565 | ) | ||||
| ADJUSTED COST OF SALES | $ | 29,712 | $ | 23,465 | $ | 116,145 | $ | 85,804 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP R&D EXPENSE TO NON-GAAP (ADJUSTED) R&D EXPENSE
(Unaudited, amounts in thousands)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018^(1)^ | 2019 | 2018^(1)^ | |||||||||
| GAAP R&D EXPENSE | $ | 5,172 | $ | 3,152 | $ | 19,450 | $ | 15,821 | ||||
| ADJUSTMENTS TO R&D EXPENSE: | ||||||||||||
| Acquisition and integration costs | (282 | ) | (166 | ) | (687 | ) | (166 | ) | ||||
| ADJUSTED R&D EXPENSE | $ | 4,890 | $ | 2,986 | $ | 18,763 | $ | 15,655 | ||||
| (1) | Certain prior year balances have changed to reflect current year presentation. | |||||||||||
| --- | --- |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP SG&A EXPENSE TO NON-GAAP (ADJUSTED) SG&A EXPENSE
(Unaudited, amounts in thousands)
| Three Months EndedDecember 31, | Twelve Months EndedDecember 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2018^(1)^ | 2019 | 2018^(1)^ | |||||||||
| GAAP SG&A EXPENSE | $ | 28,287 | $ | 17,345 | $ | 95,613 | $ | 65,692 | ||||
| ADJUSTMENTS TO SG&A EXPENSE: | ||||||||||||
| Acquisition and integration costs | (2,371 | ) | (457 | ) | (10,870 | ) | (2,600 | ) | ||||
| Intangible amortization | (3,751 | ) | (2,477 | ) | (12,921 | ) | (9,953 | ) | ||||
| ADJUSTED SG&A EXPENSE | $ | 22,165 | $ | 14,411 | $ | 71,822 | $ | 53,139 | ||||
| (1) | Certain prior year balances have changed to reflect current year presentation. <br> | |||||||||||
| --- | --- |
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REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME GUIDANCE TO ADJUSTED (NON-GAAP NET INCOME GUIDANCE)
| (in thousands) | Twelve months ending December 31, 2020 | |||||
|---|---|---|---|---|---|---|
| Low End | High End | |||||
| GUIDANCE ON NET INCOME | $ | 33,500 | $ | 36,500 | ||
| ADJUSTMENTS TO GUIDANCE ON NET INCOME: | ||||||
| Acquisition and integration costs | 4,810 | 4,810 | ||||
| Anticipated pre-tax amortization of acquisition-related<br>intangible assets | 15,398 | 15,398 | ||||
| Non-cash interest expense | 10,957 | 10,957 | ||||
| Tax effect of intangible amortization and integration | (7,636 | ) | (7,636 | ) | ||
| Guidance rounding adjustment | (29 | ) | (29 | ) | ||
| GUIDANCE ON ADJUSTED NET INCOME | $ | 57,000 | $ | 60,000 |
REPLIGEN CORPORATION
RECONCILIATION OF GAAP NET INCOME PER SHARE GUIDANCE TO
ADJUSTED (NON-GAAP) NET INCOME PER SHARE GUIDANCE
| Twelve months ending December 31, 2020 | ||||||
|---|---|---|---|---|---|---|
| Low End | High End | |||||
| GUIDANCE ON NET INCOME PER SHARE - DILUTED | $ | 0.63 | $ | 0.68 | ||
| ADJUSTMENTS TO GUIDANCE ON NET INCOME PER SHARE - DILUTED. | ||||||
| Acquisition and integration costs | $ | 0.09 | $ | 0.09 | ||
| Anticipated pre-tax amortization of acquisition-related<br>intangible assets | $ | 0.29 | $ | 0.29 | ||
| Non-cash interest expense | $ | 0.21 | $ | 0.21 | ||
| Tax effect of intangible amortization and integration | ($0.14 | ) | ($0.14 | ) | ||
| Guidance rounding adjustment | ($0.00 | ) | ($0.00 | ) | ||
| GUIDANCE ON ADJUSTED NET INCOME PER SHARE - DILUTED | $ | 1.07 | $ | 1.12 | ||
| Totals may not add due to rounding. |
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