Omrix Biopharmaceuticals Ltd. (Nasdaq:OMRI) today published an update on its financial report for the fourth quarter of 2007 and the year as whole, which is due to be published on March 6. The company's revised expectations are higher than analysts' estimates.
Omrix says that fourth quarter product sales totaled $17.5 million, up 11.5% on the $15.7 million for the corresponding quarter of 2006, and revenue totaled $20.4 million, up 13.3% on the $18 million.
For the year as a whole, product sales were $51.9 million, up 45% on $35.7 million in 2006, not including $21.2 million of sales of Vaccinia Immunoglobulin (VIG) that year. 2007 product sales exceeded the company's guidance of $46-49 million. Total revenue was $61.5 million in 2007, up 45% on $42.5 million in 2006, not including the VIG sales. Including the VIG sales, 2007 revenue was 4% less than the $63.8 million in 2006.
Analysts had predicted a greater decline in revenue; the consensus was a 9% drop in revenue to $58.9 million.
Omrix predicts $64-67 million revenue in 2008, or 23-29% growth over 2007. Biosurgury sales are projected to increase by 75%. The guidance assumes no VIG sales in 2008 and are based on biosurgery sales forecasts provided by Johnson & Johnson (NSYE: KNJ) subsidiary Ethicon, Inc.
Omrix records product sales from two business lines: biosurgery and passive immunotherapy. Product sales from biosurgery mainly represent sales of fibrin sealants Evicel and Quixil, as well as Evithrom, its thrombin product. Product sales from immunotherapy represent sales of passive immunotherapy and hyperimmune products IVIG and HBIG. Omrix to sell its biodefense hyperimmune product, VIG, for the treatment of complications related to the smallpox vaccination as part of the immunotherapy business strategy. As with all biodefense products, VIG sales are dependent on government contracts, and it is difficult to predict if and when a contract will be awarded and the size of such contract. In 2006, for example, the company supplied $21.2 million worth of VIG to the UK government. The company also reported $6 million in VIG sales in the fourth quarter. However, the financial results for the fourth quarter of 2007 and the year as a whole do not include any product sales from VIG. Therefore, when comparing the results with the corresponding periods of 2006, it is important to note that VIG sales in 2006 had a significant, positive effect on product sales and net profit.
Omrix rose 7% yesterday to $21.50, and rose a further 1.6% in after-hours trading.
Published by Globes [online], Israel business news - www.globes-online.com - on February 6, 2008
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