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Taro Pharmaceutical Industries Ltd.
c/o Taro Pharmaceuticals U.S.A., Inc.
Three Skyline Drive
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Hawthorne, New York 10532
(NYSE: TARO)
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CONTACTS:
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Mariano A. Balaguer
VP, CFO
(914) 345-9001
Mariano.Balaguer@taro.com
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William J. Coote
AVP, Business Finance, Treasurer and Investor Relations
(914) 345-9001
William.Coote@taro.com
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●
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Net sales of $161.3 million, increased $6.7 million, or 4.3%, despite a single digit decrease in volumes primarily due to category mix.
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●
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Gross profit of $101.7 million increased $1.6 million, and as a percentage of net sales was 63.1% compared to 64.7%.
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●
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Research and development expenses of $13.4 million remained in line with prior year.
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●
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Selling, marketing, general and administrative expenses of $19.7 million decreased $3.9 million.
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Operating income of $68.6 million increased $5.4 million and as a percentage of net sales was 42.5% as compared to 40.8%.
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Interest and other financial income increased $1.8 million to $9.6 million.
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Foreign Exchange (FX) income of $7.9 million decreased $2.1 million the result of the strengthening of the Canadian dollar vs. the U.S. dollar.
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Tax expense of $20.4 million increased $6.3 million with the effective tax rate increasing to 23.6% from 17.3%.
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Net income attributable to Taro was $66.2 million compared to $67.3 million, resulting in diluted earnings per share of $1.72 compared to $1.71.
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Cash flow provided by operations was $82.6 million compared to $82.4 million for the three months ended June 30, 2018.
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As of June 30, 2019, cash, including short-term and long-term marketable securities and bank deposits, increased $77.6 million to $1.431 billion from March 31, 2019.
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Three Months Ended June 30,
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||||||||
2019
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2018
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|||||||
Sales, net
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$
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161,296
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$
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154,618
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||||
Cost of sales
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59,572
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54,536
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||||||
Gross profit
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101,724
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100,082
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||||||
Operating Expenses:
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||||||||
Research and development
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13,443
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13,345
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||||||
Selling, marketing, general and administrative
|
19,718
|
23,582
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||||||
Operating income
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68,563
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63,155
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||||||
Financial income, net:
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||||||||
Interest and other financial income
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(9,624
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)
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(7,804
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)
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||||
Foreign exchange income
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(7,905
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)
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(9,962
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)
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||||
Other gain, net
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594
|
603
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||||||
Income before income taxes
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86,686
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81,524
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||||||
Tax expense
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20,445
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14,096
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||||||
Net income
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66,241
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67,428
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||||||
Net income attributable to non-controlling interest
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58
|
151
|
||||||
Net income attributable to Taro
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$
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66,183
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$
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67,277
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||||
Net income per ordinary share attributable to Taro:
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||||||||
Basic and Diluted
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$
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1.72
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$
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1.71
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||||
Weighted-average number of shares used to compute net income per share:
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||||||||
Basic and Diluted
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38,539,056
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39,260,218
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June 30,
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March 31,
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|||||||
2019
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2019
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|||||||
ASSETS
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(unaudited)
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(audited)
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||||||
CURRENT ASSETS:
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||||||||
Cash and cash equivalents
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$
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632,986
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$
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567,451
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||||
Marketable securities
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506,751
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481,883
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||||||
Accounts receivable and other:
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||||||||
Trade, net
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213,514
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237,945
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||||||
Corporate tax receivable
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9,476
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25,969
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||||||
Other receivables and prepaid expenses
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22,645
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21,393
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||||||
Inventories
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148,283
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148,079
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||||||
TOTAL CURRENT ASSETS
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1,533,655
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1,482,720
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||||||
Long-term deposits and marketable securities
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291,544
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304,322
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||||||
Property, plant and equipment, net
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205,654
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206,242
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||||||
Deferred income taxes
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108,852
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110,974
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||||||
Other assets
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32,495
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31,068
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||||||
TOTAL ASSETS
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$
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2,172,200
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$
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2,135,326
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LIABILITIES AND SHAREHOLDERS' EQUITY
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||||||||
CURRENT LIABILITIES:
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||||||||
Trade payables
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$
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37,210
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$
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35,060
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||||
Other current liabilities
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152,023
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181,761
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||||||
TOTAL CURRENT LIABILITIES
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189,233
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216,821
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||||||
Deferred taxes and other long-term liabilities
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8,122
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7,383
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TOTAL LIABILITIES
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197,355
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224,204
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||||||
Taro shareholders' equity
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1,969,201
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1,905,536
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Non-controlling interest
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5,644
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5,586
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
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$
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2,172,200
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$
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2,135,326
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Three Months Ended June 30,
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||||||||
2019
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2018
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|||||||
Cash flows from operating activities:
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||||||||
Net income
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$
|
66,241
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$
|
67,428
|
||||
Adjustments required to reconcile net income to net cash provided by operating activities:
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||||||||
Depreciation and amortization
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5,071
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4,299
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||||||
Realized gain on sale of marketable securities
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—
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(7
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)
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|||||
Change in derivative instruments, net
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(2,421
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)
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3,546
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|||||
Effect of change in exchange rate on inter-company balances, marketable securities and bank deposits
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(5,624
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)
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(28,918
|
)
|
||||
Deferred income taxes, net
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2,930
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1,575
|
||||||
Decrease (increase) in trade receivables, net
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24,431
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(2,897
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)
|
|||||
(Increase) decrease in inventories, net
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(205
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)
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2,653
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|||||
Decrease in other receivables, income tax receivable, prepaid expenses and other
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15,671
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52,479
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||||||
Decrease in trade, income tax, accrued expenses, and other payables
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(22,965
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)
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(17,408
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)
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Income from marketable securities, net
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(525
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)
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(310
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)
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||||
Net cash provided by operating activities
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82,604
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82,440
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||||||
Cash flows from investing activities:
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||||||||
Purchase of plant, property & equipment, net
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(7,969
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)
|
(6,078
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)
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||||
Investment in other intangible assets
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(30
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)
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(45
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)
|
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Proceeds from short-term bank deposits, net
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—
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51,345
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||||||
Proceeds from long-term deposits and other assets
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—
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70,685
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||||||
Investment in marketable securities, net
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(9,070
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)
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(107,644
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)
|
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Net cash (used in) provided by investing activities
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(17,069
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)
|
8,263
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|||||
Cash flows from financing activities:
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||||||||
Purchase of treasury stock
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—
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(24,655
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)
|
|||||
Net cash used in financing activities
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—
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(24,655
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)
|
|||||
Effect of exchange rate changes on cash and cash equivalents
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—
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(670
|
)
|
|||||
Increase in cash and cash equivalents
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65,535
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65,378
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||||||
Cash and cash equivalents at beginning of period
|
567,451
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576,611
|
||||||
Cash and cash equivalents at end of period
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$
|
632,986
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$
|
641,989
|
||||
Cash Paid during the year for:
|
||||||||
Income taxes
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$
|
10,432
|
$
|
36,830
|
||||
Cash Received during the year for:
|
||||||||
Income taxes
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$
|
7,128
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$
|
60,544
|
||||
Non-cash investing transactions:
|
||||||||
Purchase of property, plant and equipment included in accounts payable
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$
|
2,317
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$
|
1,823
|
||||
Non-cash financing transactions:
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||||||||
Purchase of marketable securities
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$
|
2,436
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$
|
8,629
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By:
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/s/ Uday Baldota
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Name: Uday Baldota
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Title: Chief Executive Officer and Director
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