Louisiana
|
001-32360
|
72-0717400
|
(State or other
Jurisdiction of
Incorporation)
|
(Commission
File Number)
|
(I.R.S. Employer
Identification No.)
|
1.
|
Election of Directors. The following six individuals were elected to serve as directors of the Company for a one-year term beginning immediately and ending on the date of the Company’s 2012 annual meeting of shareholders:
|
Nominee
|
Votes
For
|
Votes
Withheld
|
Broker
Non Votes
|
John N. Kapoor, Ph.D.
|
69,396,739
|
600,460
|
14,971,242
|
Kenneth S. Abramowitz
|
69,802,318
|
194,881
|
14,971,242
|
Ronald M. Johnson
|
67,681,330
|
2,315,869
|
14,971,242
|
Steven J. Meyer
|
69,615,124
|
382,075
|
14,971,242
|
Brian Tambi
|
69,799,135
|
198,064
|
14,971,242
|
Alan Weinstein
|
69,616,664
|
380,535
|
14,971,242
|
2.
|
Ratification of Ernst & Young LLP to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2011. Ratification required affirmative vote of a majority of the votes cast. Voting results were as follows:
|
Shares Voted
|
Percent of
Votes Cast
|
|
For
|
84,885,280
|
99.9%
|
Against
|
72,969
|
0.1%
|
Abstain
|
10,192
|
0.0%
|
Non Votes
|
0
|
n/a
|
3.
|
Non-binding advisory vote to approve the Company’s current executive compensation programs and practices. The advice of shareholders is based on the majority of votes cast, with abstentions and non-votes having no impact on the results. Voting results were as follows:
|
Shares Voted
|
Percent of
Votes Cast
|
|
For
|
69,124,221
|
98.8%
|
Against
|
855,287
|
1.2%
|
Abstain
|
17,691
|
n/a
|
Non Votes
|
14,971,242
|
n/a
|
4.
|
Non-binding advisory vote on the frequency with which the Company should hold future non-binding advisory votes on the Company’s executive compensation programs and practices. The advice of shareholders is based on the majority of votes cast, with abstentions and non-votes having no impact on the results. Voting results were as follows:
|
Frequency of Future
Votes on Executive
Compensation
|
Shares Voted
|
Percent of
Votes Cast
|
Every One Year
|
66,653,207
|
95.3%
|
Every Two Years
|
15,161
|
0.0%
|
Every Three Years
|
3,295,547
|
4.7%
|
Abstain
|
33,284
|
n/a
|
Non-Votes
|
14,971,242
|
n/a
|
Exhibit No.
|
Description of Exhibit .
|
|
99.1
|
Press release issued by Akorn on May 3, 2011 announcing financial results for the quarter ended March 31, 2011.
|
|
99.2 |
Press release issued by Akorn on May 3, 2011 announcing entry into an agreement to acquire Vision Research, Inc. and plans to launch a new Consumer Health Division.
|
Akorn, Inc.
|
|
By: /s/ Timothy A. Dick
|
|
Timothy A. Dick
|
|
Chief Financial Officer
|
|
●
|
Core business revenue growth of 66% over the comparable prior year quarter. Akorn’s core business consists of the ophthalmic, hospital drugs & injectables and contract services segments.
|
●
|
Gross margins increased to 56%, up from 53% in the prior quarter and 41% in the comparable prior year quarter.
|
●
|
Seventh consecutive quarter of core revenue, core gross margin and adjusted EBITDA growth.
|
●
|
Filed three new internally developed ANDAs with a combined market value of $190 million.
|
●
|
Successfully transitioned the Akorn-Strides joint venture to Pfizer.
|
●
|
The Company projects 2011 revenue in the range of $94.0 million to $98.0 million before the impact of the AVR acquisition. AVR is expected to add approximately $12.0 million to 2011 revenues. The company now projects 2011 revenues in the range of $106 million to $110 million.
|
●
|
The Company’s 2011 gross margin is projected to be between 52% and 54% including the impact of the AVR acquisition.
|
●
|
The Company projects 2011 adjusted EBITDA of approximately $25.0 million to $30.0 million including the impact of the AVR acquisition.
|
●
|
In 2011, the Company expects to spend approximately $15 million to $20 million in capital expenditures to increase plant capacities and improve efficiencies.
|
●
|
The Company is projecting 2011 R&D expenses of approximately $9.0 million to $10.0 million.
|
●
|
The Company’s 2011 outlook excludes the impact of any new approvals after May 2, 2011.
|
●
|
Interest income (expense), net
|
|
●
|
Provision for income taxes
|
|
●
|
Depreciation and amortization
|
|
●
|
Non-cash expenses, such as share-based compensation expense and changes in the fair value of warrants
|
|
●
|
Other adjustments, such as supply agreement termination expenses and equity in earnings of unconsolidated joint venture related to the sale of the joint venture's assets
|
AKORN, INC.
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
|
||||||||
IN THOUSANDS, EXCEPT PER SHARE DATA
|
||||||||
(UNAUDITED)
|
||||||||
THREE MONTHS ENDED
|
||||||||
MARCH 31,
|
||||||||
2011
|
2010
|
|||||||
Revenues
|
$
|
25,444 |
$
|
20,520 | ||||
Cost of sales
|
11,191
|
12,092
|
||||||
GROSS PROFIT
|
14,253
|
8,428
|
||||||
Selling, general and administrative expenses
|
6,402
|
4,757
|
||||||
Research and development expenses
|
1,887
|
1,432
|
||||||
Amortization of intangibles
|
256
|
414
|
||||||
TOTAL OPERATING EXPENSES
|
8,545
|
6,603
|
||||||
OPERATING INCOME
|
5,708
|
1,825
|
||||||
Write-off and amortization of deferred financing costs
|
(193
|
)
|
(273
|
)
|
||||
Interest income (expense), net
|
11
|
(290
|
)
|
|||||
Equity in earnings of unconsolidated joint venture
|
824
|
464
|
||||||
Change in fair value of warrants liability
|
-
|
1,798
|
||||||
INCOME BEFORE INCOME TAXES
|
6,350
|
3,524
|
||||||
Income tax provision
|
540
|
4
|
||||||
NET INCOME
|
$
|
5,810 |
$
|
3,520 | ||||
NET INCOME PER SHARE:
|
||||||||
BASIC
|
$
|
0.06 |
$
|
0.04 | ||||
DILUTED
|
$
|
0.06 |
$
|
0.04 | ||||
SHARES USED IN COMPUTING NET INCOME
|
||||||||
PER SHARE:
|
||||||||
BASIC
|
94,197
|
90,446
|
||||||
DILUTED
|
103,985
|
92,817
|
||||||
AKORN, INC.
|
||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
||||||||
IN THOUSANDS, EXCEPT SHARE DATA
|
||||||||
MARCH 31,
|
DECEMBER 31,
|
|||||||
2011
|
2010
|
|||||||
(Unaudited)
|
(Audited)
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash and cash equivalents
|
$ | 45,712 | $ | 41,623 | ||||
Trade accounts receivable, net
|
14,453 | 11,270 | ||||||
Inventories
|
19,830 | 18,917 | ||||||
Prepaid expenses and other current assets
|
1,810 | 1,803 | ||||||
TOTAL CURRENT ASSETS
|
81,805 | 73,613 | ||||||
PROPERTY, PLANT AND EQUIPMENT, NET
|
34,014 | 32,731 | ||||||
OTHER LONG-TERM ASSETS:
|
||||||||
Intangibles, net
|
2,866 | 3,122 | ||||||
Deferred financing costs
|
1,352 | 1,545 | ||||||
Other
|
105 | 105 | ||||||
TOTAL OTHER LONG-TERM ASSETS
|
4,323 | 4,772 | ||||||
TOTAL ASSETS
|
$ | 120,142 | $ | 111,116 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Trade accounts payable
|
$ | 6,477 | $ | 4,894 | ||||
Accrued compensation
|
1,428 | 3,396 | ||||||
Accrued expenses and other liabilities
|
3,763 | 3,473 | ||||||
Advance from unconsolidated joint venture
|
10,680 | 10,177 | ||||||
TOTAL CURRENT LIABILITIES
|
22,348 | 21,940 | ||||||
LONG-TERM LIABILITIES:
|
||||||||
Lease incentive obligations
|
1,096 | 1,125 | ||||||
Product warranty liability
|
1,299 | 1,299 | ||||||
TOTAL LONG-TERM LIABILITIES
|
2,395 | 2,424 | ||||||
TOTAL LIABILITIES
|
24,743 | 24,364 | ||||||
SHAREHOLDERS' EQUITY:
|
||||||||
Common stock, no par value -- 150,000,000 shares authorized, 94,545,555
|
||||||||
and 93,975,334 shares issued and outstanding at March 31, 2011 | ||||||||
and December 31, 2010, respectively
|
187,030 | 182,466 | ||||||
Warrants to acquire common stock
|
17,946 | 19,673 | ||||||
Accumulated deficit
|
(109,577 | ) | (115,387 | ) | ||||
TOTAL SHAREHOLDERS' EQUITY
|
95,399 | 86,752 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$ | 120,142 | $ | 111,116 |
AKORN, INC.
|
||||||||
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
|
||||||||
IN THOUSANDS (UNAUDITED)
|
||||||||
THREE MONTHS ENDED
|
||||||||
MARCH 31,
|
||||||||
2011
|
2010
|
|||||||
OPERATING ACTIVITIES
|
||||||||
Net income
|
$ | 5,810 | $ | 3,520 | ||||
Adjustments to reconcile net income to net cash
|
||||||||
provided by operating activities:
|
||||||||
Depreciation and amortization
|
1,126 | 1,302 | ||||||
Write-off and amortization of deferred financing fees
|
193 | 273 | ||||||
Non-cash stock compensation expense
|
731 | 301 | ||||||
Non-cash change in fair value of warrants liability
|
- | (1,798 | ) | |||||
Equity in earnings of unconsolidated joint venture
|
(824 | ) | (464 | ) | ||||
Changes in operating assets and liabilities:
|
||||||||
Trade accounts receivable
|
(3,183 | ) | (2,413 | ) | ||||
Inventories
|
(913 | ) | 901 | |||||
Prepaid expenses and other current assets
|
(7 | ) | 575 | |||||
Trade accounts payable
|
1,583 | (23 | ) | |||||
Accrued expenses and other liabilities
|
(2,194 | ) | (209 | ) | ||||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
2,322 | 1,965 | ||||||
INVESTING ACTIVITIES
|
||||||||
Purchases of property, plant and equipment
|
(2,131 | ) | (1,185 | ) | ||||
Distribution from unconsolidated joint venture
|
1,792 | 730 | ||||||
NET CASH USED IN INVESTING ACTIVITIES
|
(339 | ) | (455 | ) | ||||
FINANCING ACTIVITIES
|
||||||||
Proceeds from exercise of stock warrants
|
1,727 | - | ||||||
Proceeds under stock option and stock purchase plans
|
379 | 95 | ||||||
Repayments of line of credit
|
- | (3,000 | ) | |||||
Net proceeds from common stock and warrant offering
|
- | 2,469 | ||||||
NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
|
2,106 | (436 | ) | |||||
INCREASE IN CASH AND CASH EQUIVALENTS
|
4,089 | 1,074 | ||||||
Cash and cash equivalents at beginning of period
|
41,623 | 1,617 | ||||||
CASH AND CASH EQUIVALENTS AT END OF PERIOD
|
$ | 45,712 | $ | 2,691 |
AKORN, INC.
|
||||||||
RECONCILIATION OF NET INCOME TO NON-GAAP ADJUSTED EBITDA
|
||||||||
IN THOUSANDS (UNAUDITED)
|
||||||||
THREE MONTHS ENDED
|
||||||||
MARCH 31,
|
||||||||
2011
|
2010
|
|||||||
NET INCOME
|
$
|
5,810
|
$
|
3,520
|
||||
ADJUSTMENTS TO ARRIVE AT EBITDA:
|
||||||||
Depreciation and amortization expense
|
1,126
|
1,302
|
||||||
Interest (income) expense, net
|
(11
|
)
|
290
|
|||||
Income tax provision
|
540
|
4
|
||||||
EBITDA
|
$
|
7,465
|
$
|
5,116
|
||||
NON-CASH AND OTHER NON-RECURRING INCOME
|
||||||||
AND EXPENSES:
|
||||||||
Non-cash stock compensation expense
|
731
|
301
|
||||||
Change in fair value of warrants liability
|
-
|
(1,798
|
)
|
|||||
Write-off and amortization of deferred financing costs
|
193
|
273
|
||||||
ADJUSTED EBITDA
|
$
|
8,389
|
$
|
3,892
|
||||