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Leiden, July 14, 2003 - Dutch biotechnology company Crucell N.V. (Euronext, NASDAQ: CRXL) today announced its financial results for the second quarter of 2003. Crucell's revenues for the second quarter 2003 were € 1.1 million (US$ 1.3 million) compared to € 2.9 million (US$ 3.3 million) for the same quarter in 2002. Net loss for the second quarter was € 6.2 million (US$ 7.1 million), compared to € 6.1 million (US$ 7.0 million) for the same quarter last year.
Crucell's total revenues for the first half year were € 3.3 million (US$ 3.7 million), compared to € 5.0 million (US$ 5.7 million) for the same period last year. The net loss for the first half year 2003 decreased by 14 % to € 9.9 million (US$ 11.3 million) down from a net loss of € 11.4 million (US$ 13.1 million) in the same period last year.
Operating costs for the second quarter of 2003 are € 7.1 million (US$ 8.1 million), € 2.1 million (US$ 2.4 million) below the same period last year. Operating costs for the first half year are € 12.9 million (US$ 14.8 million), a decrease of € 3.6 million (US$ 4.1 million) compared to the first half year in 2002. Reduced compensation costs, laboratory costs and external research costs are the main drivers for the lower operating expenses.
Highlights Second Quarter 2003
Dr. C.E. Wilhelmsson and Mr. S. Lance appointed to Crucell's supervisory board. Dr. Wilhelmsson was Executive Director R&D of AstraZeneca until July 2002. Mr Lance is currently Chairman of Chiron Corporation;
Merck & Co., Inc. signed a PER.C6(TM) license agreement for the production of antibodies and therapeutic proteins. This is the third license agreement Merck & Co. have entered into with the company;
Cooperation Agreement with Merck & Co., Inc. expanded relating to PER.C6(TM) Cell Substrate Biologics Master File (BMF) at the FDA;
Crucell announced its decision to develop a West Nile vaccine for humans after conducting successful animal studies;
Kimron Veterinary Institute signed license agreement to develop a West Nile veterinary vaccine;
Galapagos Genomics N.V., a 20.8 % shareholding of Crucell, announced its collaboration with Procter & Gamble in the field of osteoporosis and its collaboration with Degussa.
Key Figures Second Quarter 2003
(€ million, except net loss per share)
Q2 2003 % change Q2 2002
Revenues 1.1 (40%) 2.9
Net loss (6.2) 1% (6.1)
Net loss per share (basic and diluted) (0.17) -- % (0.17)
Cash and cash equivalents on June 30, 2003 and December 31, 2002 99.3 110.6
Details of the Financial Results
Revenues
Second Quarter
Crucell revenues for the second quarter 2003 were € 1.1 million (US$ 1.3 million), compared to € 2.9 million (US$ 3.3 million) in the same quarter last year. License revenues in the second quarter 2003 amounted € 0.8 million (US$ 0.9 million), compared to € 1.9 million (US$ 2.1 million) in the second quarter 2002. Revenues in the second quarter consisted of upfront payments from new contracts as well as annual and other payments on existing contracts. Fewer new licenses were closed in the second quarter 2003 compared to the same period last year, resulting in lower upfront fees.
Government grants and other revenues amounted to € 0.3 million (US$ 0.3 million) in the second quarter 2003, compared to € 1.0 million (US$ 1.1 million) in the same quarter in 2002.
Half Year
Crucell revenues for the first half year 2003 were € 3.3 million (US$ 3.7 million), compared to € 5.0 million (US$ 5.7 million) in the same half year 2002. License revenues in the first half year 2003 amounted € 2.6 million (US$ 3.0 million), compared to € 3.8 million (US$ 4.3 million) in the first half year 2002. Revenues in the first half year consisted of upfront payments from new contracts as well as annual and other payments on existing contracts. Non-exclusive gene therapy licenses with Oxford Biomedica and Gencell were not renewed. This is not expected to have a material impact on revenues for the year.
Government grants and other revenues amounted to € 0.7 million (US$ 0.8 million) in the first half year 2003, compared to € 1.2 million (US$ 1.4 million) in the same half year in 2002.
The Company has in the past experienced significant fluctuations in quarterly revenues and expects to continue to experience such fluctuations in the future.
Results
Second Quarter
The net loss for the second quarter 2003 was € 6.2 million (US$ 7.1 million), or € 0.17 net loss per share (US$ 0.19), compared to a net loss of € 6.1 million (US$ 7.0 million), or € 0.17 net loss per share (US$ 0.19) for the second quarter 2002.
Total research and development expenses in the second quarter 2003 decreased to € 6.1 million (US$ 7.0 million), from € 6.5 million (US$ 7.4 million) in the second quarter of 2002. Selling, general and administrative expenses were € 1.0 million (US$ 1.2 million), a 61 % decrease compared to € 2.6 million (US$ 3.0 million) during the same quarter in 2002.
Half Year
The net loss for the first half year 2003 was € 9.9 million (US$ 11.3 million), or € 0.28 net loss per share (US$ 0.32), compared to a net loss of € 11.4 million (US$ 13.1 million), or € 0.32 net loss per share (US$ 0.37) for the first half year 2002.
Total research and development expenses in the first half year 2003 were € 10.2 million (US$ 11.6 million), compared to € 11.8 million (US$ 13.5 million) in the first half year of 2002. Selling, general and administrative expenses for the first half year 2003 were € 2.6 million (US$ 3.0 million), compared to € 4.8 million (US$ 5.4 million) for the same half year in 2002.
Cash Flow and Cash Position
Half Year
In total, cash burn during the first half year of 2003 amounted to € 11.4 million (US$ 13.0 million). This represents an increase of € 5.5 million (US$ 6.3 million), compared to the same period in 2002. The company received no proceeds from sale-lease-back transactions, compared to € 4.6 million (US$ 5.2 million) of proceeds which were received during the same period last year. This is the primary cause of increased cash burn during the first half year of 2003.
Cash invested in operating activities in the first half year of 2003 was € 10.3 million (US$ 11.8 million), compared to € 9.2 million (US$ 10.5 million) in the same period in 2002. This increase is mainly due to changes in working capital. Investments in plant and equipment decreased 50 % to € 1.0 million (US$ 1.2 million) in the first half year 2003, compared to € 2.0 million (US$ 2.3 million) in the first half year 2002.
The company's cash and cash equivalents amount to € 99.3 million (US$ 110.6 million) on June 30, 2003.
The company is expected to reach profitability once products based on Crucell's production technology are brought to market.
Other
Dinko Valerio, Chief Executive Officer of Crucell, sold 100,000 of his total holding of 681,549 shares in the company on June 16, 2003 at € 2.50 per share and used the full proceeds to repay his director loan outstanding to the company. The interest bearing director loan was reduced to € 441,992 (US$ 505,639) after repayment.
628,125 employee stock options with an exercise price of € 4.23 expired out of the money on June 24, 2003. The stock appreciation rights attached to these options expired on the same date, resulting in a reduction in compensation costs of € 2.1 million (US$ 2.4 million) for the first half year 2003. Outstanding options amount to 10.4 % of outstanding common shares at June 30, 2003.
Note: Euros are converted to US Dollars at June 30, 2003 exchange rate of 1.144.
About Crucell
Crucell N.V. is committed to improving public health through the development of vaccines and antibodies that prevent or treat infectious diseases. Crucell develops vaccines and licenses its PER.C6(TM) production technology to companies in the pharmaceutical and biotechnology industry. The company's licensees include Merck & Co., Inc. for its HIV vaccine, Novartis, GSK, Centocor/J&J and Aventis. Crucell has partnered with the US National Institutes of Health (NIH) for the development of an Ebola vaccine. The company has formed an alliance with DSM Biologics to produce monoclonal antibodies and recombinant proteins. Crucell is headquartered in Leiden, The Netherlands, and is listed on Euronext and NASDAQ stock exchanges (ticker symbol CRXL). For more information visit www.crucell.com.
This press release contains forward-looking statements that involve inherent risks and uncertainties. We have identified certain important factors that may cause actual results to differ materially from those contained in such forward-looking statements. For information relating to these factors please refer to our Form 20-F, as filed with the U.S. Securities and Exchange Commission on June 13, 2002, and the section entitled "Risk Factors". The company prepares its financial statements under generally accepted accounting principles in the United States (US GAAP).
For the pdf version of the release including figures, please click on the following attachment:
Q2 2003 Results Press Release
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