8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 29, 2003

MYLAN LABORATORIES INC.

(Exact name of registrant as specified in its charter)

Pennsylvania
(State or other jurisdiction
of incorporation) 1-9114
(Commission File
Number) 25-1211621
(I.R.S. Employer
Identification No.)

1500 Corporate Drive
Suite 400
Canonsburg, PA 15317
(Address of principal executive offices)

(724) 514-1800
(Registrant’s telephone number, including area code)

TABLE OF CONTENTS

	Item 7. Financial Statements and Exhibits.
	Item 12. Results of Operations and Financial Condition.
SIGNATURE
EXHIBIT INDEX
Press Release

Item 7.  Financial Statements and Exhibits.

(c)    Exhibits.

Exhibit No.	Description
99.1	Press release of the registrant, dated October 29, 2003.

Item 12.  Results of Operations and Financial Condition.

     On October 29, 2003, Mylan Laboratories Inc., a Pennsylvania corporation, issued a press release reporting its financial results for the quarter ended September 30, 2003. A copy of such press release is attached hereto as Exhibit 99.1.

     The information in this report (including the exhibit) shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

MYLAN LABORATORIES INC.

Date: October 29, 2003   By: /s/ Edward J. Borkowski Edward J. Borkowski
Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release of the registrant, dated October 29, 2003.

EX-99.1 3 j0387201exv99w1.htm PRESS RELEASE

Exhibit 99.1

NEWS RELEASE		FOR IMMEDIATE RELEASE
FOR:	Mylan Laboratories Inc.	For Further Information
	1500 Corporate Dr	CONTACT:	Kris King
	Canonsburg, PA 15317		(724) 514-1800

Mylan Reports Record Quarterly Earnings of $0.33 Per Diluted Share -
Record Revenues and Net Earnings also Reported, as well as Another
Record Quarter for the Generic Segment

Quarterly Financial Highlights

• Record diluted earnings per share of $0.33 ($0.50 on a pre-split basis).

• Net revenues increased 13% to a record $360.1 million.

• Net earnings increased 34% to a record $91.3 million.

• A three-for-two stock split was effected on October 8, 2003.

PITTSBURGH, PA – October 29, 2003 – Mylan Laboratories Inc. (NYSE: MYL) today announced financial results for the second quarter ended September 30, 2003, which included record diluted earnings per share, net revenues and net earnings. The quarter was driven by a strong performance from the Generic Segment which contributed net revenues of $299.5 million, a record quarter for that segment, as well as improved results from the Brand Segment. Overall, revenues for the second quarter increased 13% to $360.1 million from $319.5 million a year ago.

Diluted earnings per share for the second quarter were $0.33 compared to $0.24 for the second quarter of fiscal 2003, an increase of 38%. For the six months ended September 30, 2003, diluted earnings per share were $0.63 compared to $0.46 in the same prior year period, an increase of 37%. Included in the results for the six months ended September 30, 2003 are gains on legal settlements which amounted, net of tax, to approximately $0.05 per diluted share. All share and per share amounts in this press release have been adjusted to reflect the three-for-two stock split which was effected on October 8, 2003.

Net earnings for the quarter increased 34% to $91.3 million from $68.2 million in the same prior year period. For the six months, net earnings increased 35% to $175.1 million in fiscal 2004, compared to $130.1 million in fiscal 2003.

“We achieved the best quarter in the Company’s history,” commented Robert J. Coury, Vice Chairman and Chief Executive Officer. “Clearly the strength of the quarter was driven by our Generic business and the recent launch of omeprazole. While omeprazole has been a focus of recent attention, it is just one of a number of opportunities that we see contributing to our current and future success, and is a continuation of our commitment to bring to the market quality and affordable products.”

Second quarter net revenues for the Generic Segment increased 9% or $25.2 million, which included $68.6 million from products launched subsequent to September 30, 2002, largely due to omeprazole. Brand Segment net revenues for the second quarter were $60.6 million, an increase of 34% or $15.3 million from the same prior year period.

For the six months ended September 30, 2003, net revenues increased 16% or $96.5 million to $691.5 million from $595.0 million for the six months ended September 30, 2002. Generic Segment revenues were $554.7 million, an increase of 9% over the same prior year period, while Brand Segment revenues increased 61% to $136.8 million.

Segment Information

		Three Months Ended							Six Months Ended
		September 30,							September 30,
		2003		2002		Change			2003		2002		Change
Net Revenues (in millions):
	Generic Segment	$	299.5	$	274.3		9	%	$	554.7	$	509.9		9	%
	Brand Segment		60.6		45.3		34	%		136.8		85.1		61	%
	Total	$	360.1	$	319.5		13	%	$	691.5	$	595.0		16	%

Generic Segment

Net revenues for the quarter increased 9% or $25.2 million to $299.5 million from $274.3 million for the same prior year period. This increase is the result of $68.6 million from products launched subsequent to September 30, 2002, largely due to omeprazole, offset in part by changes in the portfolio mix.

Gross profit for the quarter increased $29.3 million to $169.2 million from $139.9 million, while earnings from operations increased $26.4 million to $147.1 million from $120.7 million in the same prior year period. The increase in earnings from operations was driven primarily by the higher gross profit, partially offset by increased research and development expense from the continued expansion of the development platform.

For the six months ended September 30, 2003, net revenues increased $44.8 million or 9% to $554.7 million from $509.9 million. New products launched subsequent to September 30, 2002 contributed net revenues of $74.4 million.

Gross profit for the year-to-date period was $307.7 million compared to $264.4 million in fiscal 2003, an increase of $43.3 million. Operating income for the six month period increased by 17% or $37.6 million to $264.7 million from $227.1 million. The increase in operating income was driven by the increased gross profit partially offset by higher research and development expenses.

Brand Segment

For the second quarter, the Brand Segment reported net revenues of $60.6 million, an increase of 34% or $15.3 million from $45.3 million in the same prior year period. Over 50% of the increase in Brand Segment net revenues resulted from Amnesteem, which

was launched in late fiscal 2003, with the remainder attributable to growth in the existing portfolio of products. Gross profit for the second quarter increased $11.6 million or 43% to $38.5 million from $26.9 million.

Earnings from operations were $11.7 million compared to $1.1 million in the same quarter of the prior year. The increase was primarily attributable to the increase in gross profit.

For the six months ended September 30, 2003, net revenues increased 61% or $51.7 million to $136.8 million from $85.1 million. Amnesteem accounted for approximately 70% of this increase. The remainder of the increase was the result of continued growth in the existing product portfolio.

Gross profit for the first six months of fiscal 2004 was $77.5 million, an increase of $27.5 million or 55% from $50.0 million in fiscal 2003. Earnings from operations were $21.5 million compared to $0.7 million. The improvement in earnings from operations was the result of increased gross profit partially offset by higher research and development expenses, primarily due to on-going studies related to nebivolol.

Corporate/Other

General and administrative expenses for the second quarter of fiscal 2004 were $24.7 million, an increase of $7.8 million from the same prior year period. For the six months ended September 30, 2003, general and administrative expenses were $46.7 million, an increase of $18.6 million from the same prior year period. The increases for both the three and six month periods were primarily due to increased legal costs and other costs related to the Company’s continued investment in its infrastructure.

Other income for the second quarter was $7.4 million which included a gain of $5.0 million on the sale of an office building. For the year-to-date period, other income was $10.5 million compared to $3.6 million in fiscal 2003.

Fiscal 2004 Earnings Guidance

Mylan reaffirms its fiscal 2004 earnings guidance of $1.11 to $1.18 per diluted share ($1.67 to $1.77 per diluted share on a pre-split basis).

Conference Call and Live Webcast

Mylan will host a conference call and live Webcast to discuss its second quarter earnings on Thursday, October 30, at 10:00 am ET. The dial-in number to access the live call is (719) 457-2629. In addition to the live call, a replay will be available from approximately 12:00 pm ET on October 30, through 12:00 pm ET on November 6, and can be accessed by dialing (719) 457-0820 with access pass code 731067.

To access the live Webcast, go to Mylan’s website at www.mylan.com and click on the Webcast icon at least 15 minutes before the call is to begin to register and download or install any necessary audio software. If you are unable to listen to the live Webcast, please access www.mylan.com at any time within seven days to listen to a replay of the Webcast.

Forward-Looking Statements

This press release includes statements that constitute “forward-looking statements”, including with regard to the Company’s opportunities and future success; the Company’s commitment to bring quality and affordable products to the market; and the Company’s fiscal 2004 earnings guidance. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Because such statements inherently involve risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to:

• the Company’s ability to successfully develop, license or otherwise acquire and introduce new products on a timely basis in relation to competing product introductions;

• the Company’s ability to obtain required FDA approvals for new products on a timely basis;

• uncertainties regarding continued market acceptance of and demand for the Company’s products;

• the Company’s periodic dependence on a relatively small group of products as a significant source of its net revenue or net income;

• the effects of vigorous competition on commercial acceptance of the Company’s products and their pricing;

• the high cost and uncertainty associated with compliance with extensive regulation of the pharmaceutical industry;

• the significant research and development expenditures the Company makes to develop products, the commercial success of which is uncertain;

• the possible loss of business from the Company’s concentrated customer base;

• the potential costs and product introduction delays that may result from use of legal, regulatory and legislative strategies by the Company’s competitors;

• the Company’s dependence on third party suppliers and distributors for the raw materials, particularly the chemical compound(s) which produces the desired therapeutic effect, the active ingredient the Company uses to manufacture its products;

• the possible negative effects of any interruption of manufacturing of the Company’s generic products at its principal facility;

• the effects of consolidation of the Company’s customer base;

• uncertainties regarding patent, intellectual and other proprietary property

	protections;
•	the expending of substantial resources associated with litigation involving patent or other intellectual property protection of competing products;
•	possible reductions in reimbursement rates for pharmaceutical products;
•	possible negative effect on product pricing of current or future legislative or regulatory programs;
•	the Company’s exposure to lawsuits and contingencies associated with its business;
•	uncertainties regarding the Company’s performance under indemnification clauses in certain material agreements;
•	the Company’s exposure to risks inherent in acquisitions or joint ventures;
•	the Company’s ability to attract and retain key personnel;
•	possible adverse effects resulting from any significant decline in the value of securities that the Company holds or from uninsured losses of funds;
•	uncertainties and matters beyond the control of management, which could affect the Company’s earnings guidance, as well as the subjectivity inherent in any probability weighted analysis underlying the Company’s assumptions and estimates with respect to the future; and
•	inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements in accordance with GAAP and related standards.

The cautionary statements referred to above should be considered in connection with any subsequent written or oral forward-looking statements that may be made by the Company or by persons acting on its behalf and in conjunction with its periodic SEC filings. In addition, please refer to the cautionary statements and risk factors in Item I of the Company’s Form 10-K for the year ended March 31, 2003, as well as those contained in the Company’s Form 10-Q for the period ended June 30, 2003. The Company undertakes no duty to update its forward-looking statements, even though its situation may change in the future.

Mylan Laboratories Inc. is a leading pharmaceutical company with four subsidiaries, Mylan Pharmaceuticals Inc., Mylan Technologies Inc., UDL Laboratories, Inc. and Bertek Pharmaceuticals Inc., that develop, manufacture and market an extensive line of generic and proprietary products. For more information about Mylan, visit www.mylan.com.

MYLAN LABORATORIES INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Earnings

(unaudited; in thousands, except per share amounts)

	Three Months Ended				Six Months Ended
	September 30, 2003		September 30, 2002		September 30, 2003			September 30, 2002
Net revenues	$	360,060	$	319,539	$	691,468		$	595,012
Cost of sales		152,352		152,807		306,331			280,678
Gross profit		207,708		166,732		385,137			314,334
Operating expenses:
Research and development		23,946		20,169		48,685			37,012
Selling and marketing		17,274		16,538		35,110			33,425
General and administrative		32,312		25,030		61,920			44,251
Litigation settlements		—		—		(21,669	)		—
Total operating expenses		73,532		61,737		124,046			114,688
Earnings from operations		134,176		104,995		261,091			199,646
Other income, net		7,428		1,613		10,533			3,601
Earnings before income taxes		141,604		106,608		271,624			203,247
Provision for income taxes		50,326		38,379		96,483			73,169
Net earnings	$	91,278	$	68,229	$	175,141		$	130,078
Earnings per common share:
Basic	$	0.34	$	0.24	$	0.65		$	0.46
Diluted	$	0.33	$	0.24	$	0.63		$	0.46
Weighted average common shares:
Basic		268,644		282,064		269,432			282,727
Diluted		276,424		285,248		276,276			285,448

MYLAN LABORATORIES INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(unaudited; in thousands)

				September 30, 2003		March 31, 2003
Assets:
	Current assets:
		Cash and cash equivalents		$	194,145	$	258,902
		Marketable securities			444,207		427,904
		Accounts receivable, net			232,479		187,587
		Inventories			290,742		237,777
		Other current assets			113,770		116,041
			Total current assets		1,275,343		1,228,211
	Non-current assets				525,029		517,012
Total assets				$	1,800,372	$	1,745,223
Liabilities:
	Current liabilities			$	227,636	$	265,771
	Non-current liabilities				39,411		33,120
Total liabilities					267,047		298,891
Total shareholders’ equity					1,533,325		1,446,332
Total liabilities and shareholders’ equity				$	1,800,372	$	1,745,223

MYLAN LABORATORIES INC. AND SUBSIDIARIES
Segment Results
(unaudited; in thousands)

	Three Months Ended						Six Months Ended
	September 30, 2003			September 30, 2002			September 30, 2003			September 30, 2002
Consolidated:
Net revenues	$	360,060		$	319,539		$	691,468		$	595,012
Cost of sales		152,352			152,807			306,331			280,678
Gross profit		207,708			166,732			385,137			314,334
Research and development		23,946			20,169			48,685			37,012
Selling and marketing		17,274			16,538			35,110			33,425
General and administrative		32,312			25,030			61,920			44,251
Litigation settlements		—			—			(21,669	)		—
Earnings from operations	$	134,176		$	104,995		$	261,091		$	199,646
Generic Segment:
Net revenues	$	299,483		$	274,281		$	554,711		$	509,926
Cost of sales		130,271			134,409			247,044			245,571
Gross profit		169,212			139,872			307,667			264,355
Research and development		14,154			10,873			27,641			20,887
Selling and marketing		2,761			2,551			5,517			5,299
General and administrative		5,164			5,701			9,855			11,099
Earnings from operations	$	147,133		$	120,747		$	264,654		$	227,070
Brand Segment:
Net revenues	$	60,577		$	45,258		$	136,757		$	85,086
Cost of sales		22,081			18,398			59,287			35,107
Gross profit		38,496			26,860			77,470			49,979
Research and development		9,792			9,296			21,044			16,125
Selling and marketing		14,513			13,987			29,593			28,126
General and administrative		2,468			2,450			5,371			5,015
Earnings from operations	$	11,723		$	1,127		$	21,462		$	713
Corporate/Other:
General and administrative	$	24,680		$	16,879		$	46,694		$	28,137
Litigation settlements		—			—			(21,669	)		—
Loss from operations	$	(24,680	)	$	(16,879	)	$	(25,025	)	$	(28,137	)

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EX-99.1

Ex-99.1