2012 Financial Results
For 2012 Insmed posted a net loss attributable to common stockholders of $41.4 million, or $1.56 per share, compared with a net loss of $68.8 million, or $2.95 per share, for 2011. The net loss attributable to common stockholders for 2012 included $2.9 million in severance costs related to the termination of certain executives and employees. The net loss attributable to common stockholders for 2011 included a $26.0 million non-cash impairment loss for the write-down of the carrying amounts of the Company's in-process research and development and goodwill intangible assets, a $9.2 million non-cash charge for the beneficial conversion feature of the previously outstanding Series B Preferred Stock issued in the Transave merger and $1.2 million in expenses relating to the discontinued use of the Company's Richmond, Virginia facility.
Research and development expense for 2012 increased to $29.8 million from $28.6 million for 2011. The net increase of $1.2 million was primarily due to increases in manufacturing expenses, as the Company increased production of ARIKACE for use in clinical studies, and compensation and compensation-related expenses. These increases were mostly offset by lower clinical development expenses during 2012, compared with 2011.
General and administrative expense for 2012 increased to $12.7 million from $11.5 million in 2011. The 2012 results included $2.2 million in severance expenses related to the departure of several executives and employees. The 2011 results included $1.2 million in charges related to the discontinued use of the Company's Richmond, Virginia facility.
Balance Sheet Highlights and Cash Guidance
As of December 31, 2012, Insmed had cash and cash equivalents of $92.9 million, compared with $78.4 million as of December 31, 2011. The increase in cash resulted from financing activities during 2012, which included proceeds from a $20.0 million debt financing and proceeds of $25.7 million from a common stock offering. These financings were partially offset by the use of $31.0 million in the Company's operations. As of December 31, 2012, working capital was $75.7 million, excluding a $2.2 million certificate of deposit that matures in July 2013.
The Company estimates its 2013 cash requirements to fund operations will be in the range of $45 million to $55 million. The Company expects that it will be able to fund operations into 2014 with its existing cash balances as of December 31, 2013.
Insmed management will host an investment community conference call today beginning at 8:30 a.m. Eastern time. Shareholders and other interested parties may participate in the call by dialing 800-299-9630 (domestic) or 617-786-2904 (international) and entering passcode 99541272. The call will also be broadcast live on the Internet at www.insmed.com, www.streetevents.com and www.earnings.com.
A replay of the conference call will be accessible two hours after its completion through March 24, 2013, by dialing 888-286-8010 (domestic) or 617-801-6888 (international) and entering passcode 88911892. The call will also be archived for 90 days at www.insmed.com, www.streetevents.com and www.earnings.com.
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