Friday, drug manufacturer Skyepharma Plc (SKP.L, SKYE) reported a narrower net loss in its first half of fiscal 2009, despite a decline in revenues. The company said its first-half trading was in line with the Board's expectations, and that it projects second half of 2009 trading to remain in line with the forecast. SkyePharma said that its meeting with FDA, regarding Flutiform, to determine how to address potential review issues, to be held shortly.
Net loss attributable to the owners of the parent was GBP 6.1 million or 26.7 pence per share, compared to a loss of GBP 6.8 million or 84.0 pence per share last year. The company noted that the prior year results were restated.
The latest six-month results included exceptional income of GBP 0.5 million or 2.2 pence per share, as income of GBP 5.0 million was partly offset by exceptional charge of GBP 4.5 million, while prior year's results included exceptional charge of GBP 3.4 million or 42 pence per share.
Before exceptional items, attributable loss was GBP 6.6 million or 28.9 pence per share, wider than prior year's loss of GBP 3.4 million or 42 pence per share.
Pre-tax loss narrowed to GBP 5.8 million from GBP 6.4 million a year earlier.
Revenue for the six-month period was GBP 25.5 million, in line with expectations, but down 10% from last year's GBP 28.4 million that included GBP 2.9 million non-recurring manufacturing revenue.
Royalty and manufacturing revenues were GBP 18.9 million in the first half of 2009, lower than last year's revenues of GBP 19.7 million.
Pre-exceptional operating profit was GBP 4.9 million, compared to a loss of GBP 1.6 million last year, resulting from reduced FlutiformR&D costs and cost savings.
In the first half of 2009 research and development expenses decreased to GBP 10.3 million from GBP 16.7 million a year ago.
Commenting on the results, Ken Cunningham, Chief Executive Officer, said, "SkyePharma made good progress on a number of fronts during the first half of 2009, with Flutiform accepted for review by the FDA in the US. Although some potential review issues have been raised by the FDA we are aiming to address these as quickly as possible and we remain confident in the potential for Flutiform in the US and other key markets. The Company also significantly reduced its cost base through the reorganization of manufacturing operations in France and research and development operations in Switzerland, resulting in annualized savings of around £2.0 million."
Flutiform development remains on track in European Union and Japan, and the company still expects EU filing for Flutiform in the first quarter of fiscal 2010.
Looming ahead, Cunningham said, "Trading for the second half of 2009 is expected to remain in line with the Board's expectations, with overall revenues similar to those reported in the first half. The second half year will benefit from the cost reductions already implemented and the continuing effect of price increases for certain manufactured products negotiated in the first six months. We will continue to control cash tightly to ensure that the cash position remains sufficient to enable the Company to achieve sustainable profitability."
SKP.L is currently trading at 101.50 pence on the LSE, down 0.75 pence or 0.73%, on a volume of 37 thousand shares.
SKYE last traded on June 13 at $25.55.
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