United Therapeutics Reports Fourth Quarter and Annual 2007 Financial Results
"We are pleased to report that United Therapeutics' revenues for the yearended December 31, 2007, totaled $210.9 million," said Martine Rothblatt,Ph.D., United Therapeutics' Chairman and Chief Executive Officer. "This isthe sixth straight year our revenues have grown by more than 30%. OurEBITDASO (earnings before interest, taxes, depreciation, amortization andstock option expense) for the year were $85.5 million, or $4.03 per basicshare."
Net income for the three months ended December 31, 2007, was $2.0 millionor $0.09 per basic share, as compared to $55.5 million or $2.54 per basicshare for the three months ended December 31, 2006. EBITDASO for the threemonths ended December 31, 2007, was $24.7 million or $1.14 per basic share, ascompared to $18.7 million or $0.81 per basic share for the three months endedDecember 31, 2006. Net income for the year ended December 31, 2007, was $19.9million or $0.94 per basic share, as compared to $74.0 million or $3.21 perbasic share in 2006.
The increases in revenues resulted primarily from growth in sales ofRemodulin.
Operating Expenses. Our operating expenses include research anddevelopment expenses, sales and marketing expenses, costs of product sales andcost of service sales.
Research and development expenses consist primarily of salaries andrelated expenses, costs to acquire pharmaceutical products and product rightsfor development, and amounts paid to contract research organizations,hospitals and laboratories for the provision of services and materials fordrug development and clinical trials. The table below summarizes research anddevelopment expenses by major project and non-project components for the threemonths and year ended December 31, 2007 and 2006 (dollars in thousands):
Selling, general and administrative expenses consist primarily ofsalaries, travel, office expenses, insurance, professional fees, provision fordoubtful accounts receivable, depreciation and amortization. The table belowsummarizes selling, general and administrative expenses by major categoriesfor the three months and year ended December 31, 2007 and 2006 (dollars inthousands):
For the year ended December 31, 2007, as compared to the year endedDecember 31, 2006, the increase in general and administrative expenses wasprimarily related to increased expenses for salaries, associated expenses andother operating expenses from growth in our operations. The increase in salesand marketing related expenses was primarily related to increased salaries andan increase in headcount, marketing, travel and associated expenses fromgrowth in our operations. The trends for the three-month period endedDecember 31, 2007, as compared to the same period in 2006, are similar tothose noted for the annual period.
The impairment charge during the three months ended December 31, 2007, wasprimarily related to an other-than-temporary decline of our investment inViRexx Medical Corp. due to the unsuccessful results of our IMPACT I and IIPhase III clinical trials of OvaRex in advanced ovarian cancer.
Stock option expense increased during the three-month and twelve-monthperiods ended December 31, 2007, over the same periods in 2006, primarily as aresult of a stock option grant to our Chief Executive Officer based on the 89%increase in our share price during 2007.
Interest Income. Interest income for the year ended December 31, 2007,was $13.6 million, as compared to interest income of $10.7 million for theyear ended December 31, 2006. The difference was due primarily to an increasein market interest rates and amounts available to invest. Interest income forthe three months ended December 31, 2007, was comparable
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