Cambrex Corp. (CBM) Tops Q2 EPS by 22c, Revenues Beat; Affirms FY18 Adj. Net Revenue & Adj. EBITDA Guidance

Cambrex Corp. (NYSE: CBM) reported Q2 EPS of $0.87, $0.22 better than the analyst estimate of $0.65. Revenue for the quarter came in at $152 million versus the consensus estimate of $132.74 million.

Highlights

• Net revenue increased 13% to $152.0 million compared to $134.6 million in the same quarter last year. Excluding the impact of adopting the new revenue standard, ASC 606 – Revenue from Contracts with Customers, net revenue decreased 1%.
• GAAP Diluted EPS from continuing operations increased 61% to $1.21 per share from $0.75 per share in the same quarter last year. The 2018 results reflect a lower tax rate as a result of tax reform in the United States. Excluding the impact of adopting ASC 606, Diluted EPS from continuing operations was $0.87 per share.
• EBITDA increased 22% to $52.2 million compared to $42.6 million in the same quarter last year. Adjusted EBITDA, which excludes the impact of adopting ASC 606, decreased to $37.2 million from $42.6 million in the same quarter last year (see table at the end of this release).
• Net cash was $171.3 million at the end of the quarter, a decrease of $16.2 million during the quarter.
• The Company continues to expect full year 2018 Adjusted net revenue growth, which excludes the impact of foreign currency and adoption of ASC 606, to be between -2% and 2% compared to 2017 and Adjusted EBITDA to be between $150 and $160 million. This does not include the impact of the Halo acquisition (see Financial Expectations – Continuing Operations section below for related explanations and additional financial guidance).
• Entered into a definitive agreement to acquire Halo Pharma, a leading dosage form Contract Development and Manufacturing Organization (CDMO) specializing in product development and commercial manufacturing, for approximately $425 million in total cash consideration.

“Our recent accomplishments mark significant progress toward our goals of investing in increased capacity and expanding our capabilities in order to take advantage of favorable industry trends and provide best-in-class services for our global customers. Most notably, we were pleased to announce the agreement to acquire Halo Pharma, which expands our offerings into finished dose development and manufacturing, while diversifying our customer base and accelerating our revenue growth,” commented Steven M. Klosk, President and Chief Executive Officer.

“We are also encouraged by second quarter performance across our three product categories. We recently added a new late-stage clinical project to our innovator portfolio with the potential to generate between $5 million and $10 million in peak API sales. This brings the total to three new late-stage projects added during the first half of 2018, with the combined potential to generate greater than $25 million in API revenue. Sales of generic APIs and controlled substances were also strong in the quarter.”

For earnings history and earnings-related data on Cambrex Corp. (CBM) click here.

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