ALLSCHWIL/BASEL, SWITZERLAND - 16 April 2013 - Actelion Ltd (SIX: ATLN) today announced financial results for the first quarter of 2013.

OPERATING HIGHLIGHTS

• Macitentan (Opsumit^®) - regulatory procedures on track
• Strong product sales performance
• Veletri (epoprostenol for injection) approved in Japan - decentralized procedure in Europe successfully concluded with first national approval expected imminently
• Phase III study with selexipag in PAH (GRIPHON) close to full enrollment - interim analysis expected in the coming weeks
• Phase III preparation ongoing for ponesimod in psoriasis and for cadazolid in CDAD

FINANCIAL HIGHLIGHTS

• Product sales of CHF 432.8 million, an increase of 5% in local currencies
• Core earnings of CHF 168.5 million, an increase of 44% in local currencies
• Core EPS of CHF 1.26, an increase of 59% in local currencies
• CHF 800 million share repurchase program on track to be completed by year-end

In CHF Million (except for per share data)	Results Q1 2013	Results Q1 2012	% Variance In CHF	% Variance In LC
Product sales	432.8	415.8	4	5
US GAAP Operating income	124.0	67.1	85	86
Core earnings (excluding DDP)	168.5	117.6	43	44
US GAAP EPS (fully diluted)	0.85	0.38	125	127
Core EPS (fully diluted)	1.26	0.80	57	59

As of 31 March 2013, Actelion had cash and cash deposits of CHF 1.6 billion (of which CHF 628 million is restricted). In addition, Actelion holds 14 million treasury shares.

Jean-Paul Clozel, MD, Chief Executive Officer, commented: "Our PAH portfolio of products, both on the market and in development, continue to make progress. Work on our late-stage assets in additional therapeutic areas is making headway. This progress, together with the strong commercial performance, clearly demonstrates that we are delivering on all three elements of our strategy. We strengthen our PAH franchise, we move forward with opportunities in potential new markets and we do so while optimizing profitability."

Andrew Oakley, Chief Financial Officer, added: "We have delivered a strong start to 2013. With the preparation of two Phase III studies underway and a product launch ahead, we will carefully look at guidance for the full year as it is possible that some of the forecasted profit growth for 2014 could be brought forward into this year. I am also happy to reiterate our commitment to conclude our 800 million Swiss Franc share buy-back program within the time-frame originally envisaged."

At Full Year 2012 reporting, unforeseen events excluded, Actelion guided for flat local currency core earnings for 2013, single-digit core earnings growth in 2014 and double-digit growth by 2015.

PRODUCT SALES FOR Q1 2013

In CHF million	Results Q1 2013	Results Q1 2012	% Variance In CHF	% Variance In LC
Tracleer sales	375.0	363.7	3	4
Ventavis sales	27.4	27.7	(1)	(1)
Veletri sales	6.7	5.3	25	24
Zavesca sales	22.9	18.6	23	23
Total Product Sales	432.8	415.8	4	5

PRODUCT SALES REVIEW

First quarter 2013 sales of Tracleer^® (bosentan) amounted to CHF 375.0 million compared to CHF 363.7 million for the same period in 2012. This represents an increase of 4% in local currencies. This performance was mainly driven by a 7% increase in units shipped, impacted by some phasing of wholesaler orders and positive pricing in the US.

Veletri^® (epoprostenol for injection) sales in the US in the first quarter of 2013 amounted to CHF 6.7 million, an increase of 24% compared to the same period in 2012, which represents approximately a 50% share of epoprostenol patients in the US. During the quarter, Veletri received regulatory approval in Japan under the trade name Epoprostenol "ACT". In the European Union, the decentralized procedure has reached a successful conclusion, first national approval expected imminently.

During the first quarter 2013, Ventavis^® (iloprost) had sales in the US of CHF 27.4 million compared to CHF 27.7 million in the first quarter 2012. In local currencies, this represents a decrease of 1% - Ventavis continues to be impacted by competitive pressure while benefiting from positive price movement.

Sales of Zavesca^® (miglustat), for the first quarter of 2013, amounted to CHF 22.9 million compared to CHF 18.6 million during the same period last year. This represents an increase of 23% in local currencies, driven predominantly by strong ex-US patient demand in the Niemann-Pick Type C indication and positive price movement in the US.

OPERATING EXPENSES REVIEW

Total operating expenses for the first quarter 2013 were CHF 309.2 million compared to CHF 350.3 million for the first quarter of 2012, a decrease of 12%.

In Q1 2013, the company incurred a CHF 12.9 million charge from a concluded arbitration proceeding. Other minor disputes are still pending. Given the non-recurrent character of this charge, it has not been included in the calculation of core earnings.

Research and Development (R&D) expenses in the first quarter of 2013 were down 29% to CHF 92.4 million (Q1 2012: CHF 129.9 million). R&D expenses are expected to increase later in the year, in line with the initiation of two Phase III programs.

Non-GAAP R&D expenses for the same period, which exclude stock-based compensation expense and amortization and depreciation, were down 24% in local currencies at CHF 80.4 million compared to CHF 106.7 million in the first quarter 2012 (Q1 2012 also excludes a payment made to Auxilium Pharmaceuticals, Inc.).

Selling, General and Administrative expenses (SG&A) for the first quarter of 2013 were CHF 145.6 million (Q1 2012: CHF 161.9 million), representing a decrease of 10%. SG&A expenses are expected to increase later in the year, in line with the market introduction of macitentan (Opsumit), currently under regulatory review in the United States, the European Union as well as in Canada and Switzerland.

Non-GAAP SG&A expenses for the first quarter of 2013, which excludes stock-based compensation expense, amortization and depreciation and impact of doubtful debt provisions, were CHF 134.8 million compared to CHF 142.7 million in the first quarter 2012, a decrease of 4% on a local currency basis.

OPERATING INCOME, CORE EARNINGS AND NET INCOME

Operating income for the first quarter 2013 was CHF 124.0 million compared to CHF 67.1 million for the same period in 2012, an increase of 85%. In local currencies operating income increased by 86%.

Financial expense amounted to CHF 9.0 million compared to CHF 13.5 million in the first quarter of 2012. Main expense contributors were the interest on the litigation provision (CHF 9.8 million) and the interest expense on the bond (CHF 3.0 million).

Tax expense amounted to CHF 17.0 million, which translates into a tax rate for the quarter of 14.8%.

Core earnings for the first quarter of 2013 amounted to CHF 168.5 million compared to CHF 117.6 million during same period in 2012. This represents an increase of 44% in local currencies.

Net income for the first quarter 2013 amounted to CHF 97.9 million (Q1 2012: CHF 45.1 million). This represents an increase of 117% in Swiss Franc terms or 119% in local currencies.

US GAAP earnings per share on a fully diluted basis in the first quarter 2013 increased to CHF 0.85 from CHF 0.38 in the same period last year, whilst core earnings per share increased by 57% to CHF 1.26.

During the first quarter of 2013, the company sold 1.9 million treasury shares to a major US-based healthcare investor, resulting in a cash inflow of approximately CHF 97 million. The company remains fully committed to share dilution management and aims to finish the current share buy-back during the fourth quarter of 2013.

 

NON-GAAP TO US GAAP RECONCILIATION FOR Q1 2013

In CHF million	Q1 2013	Q1 2012
Product sales	432.8	415.8
Core operating expenses	264.3	298.2
Core earnings excluding impact of DDP	168.5	117.6
Movement in doubtful debt provision	0.1	-10.1
Contract revenues	0.4	1.6
Stock option expenses	-13.6	-12.6
Amortization and depreciation	-18.6	-20.4
Arbitration settlement	-12.9	-
Auxilium milestone payment	-	-9.1
US GAAP Operating Income	124.0	67.1

CORE EPS CALCULATION

In CHF million	Q1 2013	Q1 2012
Core earnings	168.5	117.6
Non-GAAP financial result	0.8	-4.1
Adjusted income before tax	169.3	113.5
Tax	-25.1	-18.2
Adjusted net income	144.2	95.4
No of shares in calculation	114.9	118.9
Core EPS	1.26	0.80

  

UPCOMING EVENTS

• Annual General meeting - 18 April 2013
• HY Financial Results 2013 reporting - 18 July 2013
• 9M Financial Results 2013 reporting - 17 October 2013
• FY Financial Results 2013 reporting - 13 February 2014

• Macitentan regulatory decisions
• Selexipag complete enrollment
• Selexipag interim analysis for efficacy & futility
• Initiation of psoriasis Phase III
• Initiation of cadazolid Phase III
• Completion of the current CHF 800 million share repurchase

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NOTES TO EDITORS

 

ABOUT ACTELION LTD.

Actelion Ltd is a biopharmaceutical company with its corporate headquarters in Allschwil/Basel, Switzerland.  Actelion's first drug Tracleer®, an orally available dual endothelin receptor antagonist, has been approved as a therapy for pulmonary arterial hypertension.  Actelion markets Tracleer® through its own subsidiaries in key markets worldwide, including the United States (based in South San Francisco), the European Union, Japan, Canada, Australia and Switzerland.

Founded in late 1997 Actelion is a leading player in innovative science related to the endothelium - the single layer of cells separating every blood vessel from the blood stream.  Actelion's over 2,400 employees focus on the discovery, development and marketing of innovative drugs for significant unmet medical needs. Actelion shares are traded on the SIX Swiss Exchange (ticker symbol: ATLN) as part of the Swiss blue-chip index SMI (Swiss Market Index SMI®).

For further information please contact:

Roland Haefeli Senior Vice President, Head of Investor Relations & Public Affairs Actelion Pharmaceuticals Ltd, Gewerbestrasse 16, CH-4123 Allschwil +41 61 565 62 62 +1 650 624 69 36 www.actelion.com

 

Conference Call Information

Actelion Ltd will announce the first quarter 2013 financial results on Tuesday, 16 April 2013, at 07.00 hrs CEST / 06.00 hrs BST / 01.00 a.m. EDT. An investor conference call & webcast will be held at 14.00 hrs, CEST to discuss the results.

 

Date/Time:

16 April 2013	14.00 hrs	Basel (CEST)
	13.00 hrs	UK (BST)
	08.00 a.m	US (EDT)

 

Conference Call Connect #:

Dial-in participants should start calling the number below 10-15 minutes before the conference is due to start.

Dial:        Europe:                  +41 (0)44 580 00 74

UK:                         +44 (0)203 367 94 54

US:                         +1 866 9075 924

 

Participant's mode: Listen-Only with possibility to open individual lines during Q&A session.

Participants will be asked for their Name and Company.

Webcast Access:

Webcast participants should visit the Actelion website http://www.actelion.com 10-15 minutes before the conference is due to start.

Participant's mode: Listen-Only

Webcast Replay:

The archived Investor Webcast will be available for replay through http://www.actelion.comapproximately 60 minutes after the call has ended.