Sirtex Medical Limited (ASX: SRX) today announced half year results that
demonstrate another strong financial performance over the reporting
period and continued dose sales growth of its SIRSpheres ® microspheres
targeted radiotherapy treatment for liver cancers.
The strong result reaffirms the company's strategy over the past five
years of making appropriate investments in the company's sales and
marketing infrastructure, operations, and clinical studies program to
build a robust company with sustainable long term growth prospects.
Total revenues were $46 million, up 25.1 per cent from $37 million in
the six months to 31 December 2012. Net profit after tax (NPAT) was $7.8
million for the period, up 27.6 per cent on the same period last year.
Pre-tax profit was up 30.4 per cent from $8.2 million to $10.7 million.
Global dose sales were up 30.5 per cent to 3,522 units compared to 2,698
for the same period last year.
Strong global sales growth continues
US dose sales of 2,305 rose 35.4 per cent. Dose sales in the Asia
Pacific region of 347 increased 34.5 per cent compared to the same
period last year. Sales in Europe, Middle East and Africa (EMEA) of 870
were up 17.9 per cent compared to the same period last year.
US sales growth was a direct result of increased investment and
effectiveness in sales and marketing. The team continues to make steady
progress working closely with the referral community and making sure the
potential benefits of SIR-Spheres microspheres is widely understood.
Asia Pacific sales continue to lift. The business has adopted a direct
sales business model through the new Singapore regional head office and
also improved management of local distributors in Taiwan, South Korea
and India resulting in improved pricing and volumes.
EMEA sales demonstrated reasonable growth however, continued economic
uncertainty in Europe has made this market more challenging. The team in
EMEA is confident sales momentum will continue and medical demand
Overall sales and marketing investment grew 27.1 per cent to $15.9
million during the period and we continue to make good progress in our
efforts to expand awareness and the use of our poduct among the global
Investment in clinical studies to drive a step change in growth
Our clinical studies program is designed to obtain the level 1 data
required to demonstrate that SIRSpheres® microspheres is an effective
treatment option for patients at an earlier stage of their disease and
can help them achieve better clinical outcomes.
Investment aimed at accelerating clinical study recruitment was up 13.2
per cent to $7.0 million. This has resulted in an increase of 43.4 per
cent in the rate of patient recruitment during the reporting period.
Importantly, in the company's flagship SIRFLOX study recruitment passed
90 per cent at the end of the December and is on track to complete
recruitment by the end March 2013. Recruitment in the SIRveNIB study was
43 per cent complete at the end of December 2012 and the French SARAH
study is recruiting rapidly, achieving 20% recruitment within the last
Total operating expenses of $27.9 million were up 21.0 per cent from
$23.0 million spent in the previous corresponding period. This is in
line with the company's strategy of investing to build capability and
capacity to support long term global growth. Staff numbers were up 8%
per cent as we continued to build sales, marketing, clinical, support
and administration infrastructure worldwide ahead of the anticipated
growth in demand over coming years.
New product development accelerates
Sirtex maintained a strong focus on innovation and is developing a
promising portfolio of new products based on the success of the
company's current core technology platform. Research and development
investment was up 9.0 per cent to $2.9 million in the first half of the
2013 financial year.
Sirtex's strategy under the SIR-Spheres Evolution Program is to deliver
useful new product enhancements. This is being achieved by addressing
how to make the company's core product more effective in the clinic and
easier to use by a wider number of medical specialists. Based on the
good results to date, the company has accelerated these development
programs. This will help support longer term sales growth.
Cash management and dividend
Cash from operating activities was up 132 per cent from $5.7 million to
$13.2 million. A fully franked dividend of 10 cents per share for the
2012 financial year was paid on 26 October 2012. This equated to a
payment of $5.6 million and is the fourth consecutive year of dividend
payments. Sirtex remains debt free and at the end of December 2012 the
company's cash balance, including term deposits over 90 days, is a
healthy $51.0 million ($39.7 million, December 2011) Capital
expenditure, excluding the capitalisation of intangible assets, for the
period was $1.2 million, mainly representing the investment in expansion
of manufacturing capacity and capabilities.
Foreign exchange movements continued to impact Sirtex's financial
results as the Company earns over 95 per cent of its revenue overseas.
During the reporting period, the Australian dollar appreciated 1.7 per
cent against the US dollar and 7.9 per cent against the Euro compared to
the same period last year.
A very positive outlook
Sirtex today is well positioned for long term sustainable growth and our
business outlook in all geographic markets remains positive. There is a
significant unmet global medical need for our liver cancer therapy which
will continue to drive demand in new and established markets over the
long term. We are focused on rapidly expanding our business through our
continued investment in resources and capabilities backed by a promising
new product pipeline that provides a solid foundation for long term
growth and business success.
The full ASX release can be viewed here:
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