SOURCE: OctoPlus N.V.

February 15, 2007 01:53 ET

OctoPlus announces 2006 annual results

LEIDEN, NETHERLANDS -- (MARKET WIRE) -- February 15, 2007 --

OctoPlus N.V. ("OctoPlus" or "the Company") (Euronext: OCTO), the drug delivery and development company, announces today its annual results for the year ended 31 December 2006.

Highlights 2006

-2  development-stage  products  progressed  to  Phase  II   clinical
studies: Locteron,  for the  treatment of  chronic hepatitis  C,  and
OP-145 for the treatment of chronic middle ear infection

-Contract Development revenues increased 25%

-IPO on  Euronext Amsterdam  generated EUR   20 million  (gross) in  new
In the period, OctoPlus' two lead development compounds were progressed into Phase II clinical studies. OP-145 Phase II patient recruitment was initiated in the second quarter, while approval to start Phase IIa for Locteron was gained in November and patient dosing commenced in January 2007. Both products have reported positive Phase I results in 2006. For OP-145, a commercial license agreement was signed with Green Cross, for the commercialisation of the product in the Republic of Korea.

OctoPlus' Contract Development total gross revenues from formulation development and clinical trial material manufacturing increased by 25% to EUR 8,504k. This is the second consecutive year that OctoPlus' Contract Development activities have grown more than 20%. 80% of external service revenues came from repeat-orders and long-term contracts, showing the loyalty in OctoPlus' customer base. In order to better service the North-American market, a business development office was opened in the Boston area.

"This has been an excellent year for OctoPlus with significant progress across all of our key areas," says Joost Holthuis, CEO. "Two mid-stage clinical trials have been initiated with our lead products and revenues from our Contract Development business have again shown strong growth. Our successful lPO demonstrated the strength of our business model. We are looking forward to building further value in 2007."

Financials 2006

The table below outlines the key financial figures of the Company for the six-month period ended 31 December 2006 and 2005 and the full year 2006 and 2005. These financial figures, unaudited, are in accordance with International Financial Reporting Standards. A distinction has been made in this table between gross revenues, inter-segment revenues and consolidated (net) revenues. Gross revenues include inter-segment revenues for Contract Development supporting our Products & Drug Delivery division in the development of our own product pipeline, mainly for Locteron and OP-145. Contract Development generates most of the Company's revenues, with additional revenues from license fees and subsidies generated by our Products & Drug Delivery division. Contract Development worked at full capacity in order to facilitate as much as possible requests from third parties as well as demands for our products under development.

Key figures last six months and full
year 2006
(In Euro x 1,000; except
per share data)

                 2H 2006 2H 2005 change   Yr 2006 Yr 2005    % change

Gross revenues     4,762   3,613    32%     8,996   7,383         22%
revenues         (1,990)   (162)  1128%   (2,945)   (366)        705%
revenues           2,772   3,451  (20%)     6,051   7,017       (14%)

Result for the
period           (4,564) (3,070)    49%   (8,665) (4,209)        106%

Earnings per
share             (0.33)  (0.27)    22%    (0.68)  (0.38)         79%
(basic and

Cash, cash equivalents,
deposits and bank                          19,553   9,230        112%

Last six months ended 31 December 2006

Over the last six months of 2006, gross revenues showed an increase of 32% to EUR 4,762k (2005: EUR 3,613k). In preparation of our two Phase II clinical trials (Locteron and OP-145), the Company's Products & Drug Delivery division received services (including formulation development and manufacturing of clinical trial material) from Contract Development for an amount of EUR 1,990k (2005: EUR 162k), resulting in a decrease of consolidated (net) revenues by 20% to EUR 2,772k (2005: EUR 3,451k).

Total operating costs increased by 13% to EUR 7,295k (2005: EUR 6,430k), mainly as a result of the growth of the Company.

Net loss for the period increased by 49% to EUR 4,564k (2005: net loss of EUR 3,070k).

Full year ended 31 December 2006

For the full year 2006, total gross revenues increased by 22% to EUR 8,996k (2005: EUR 7,383k), with inter-segment revenues growing from EUR 366k in 2005 to EUR 2,945k in 2006 as a result of Contract Development supporting our Products & Drug Delivery division in the preparation of our two Phase II clinical trials (Locteron and OP-145), which have both started in 2006. As a result, consolidated (net) revenues decreased by 14% to EUR 6,051k (2005: EUR 7,017k).

Total operating costs increased by 27% to EUR 14,571k (2005: EUR 11,461k) as a result of the growth of the Company from 110 employees per 31 December 2005 to 139 employees per 31 December 2006 as well as an increase in expenditures for our pre-clinical and clinical studies.

Net loss for 2006 was EUR 8,665k, an increase of 106% compared to the net loss of EUR 4,209k for the year 2005.

Equity and cash flow

The Company raised EUR 20 million (gross) through its IPO on 4 October 2006. 4,301,076 new shares were issued at a price of EUR 4.65 per share. Earlier in the year, new shares were issued for an additional EUR 750k related to a second tranche of the January 2005 investment agreement and an additional EUR 104k was received as part of employees exercising options. In total, equity increased with EUR 17,966k in 2006 as a result of newly issued shares.

The Company started the year 2006 with a cash and cash equivalents balance (net of bank overdrafts) of EUR 9,230k. A total of EUR 6,410k was used during the year for OctoPlus' operating activities and (as described above) EUR 17,966k was received as a result of new shares issued during the year. EUR 1,233k was used for the Company's remaining investing and financing activities in 2006 resulting in a 112% increase of our cash and cash equivalents (including deposits and net of bank overdrafts) from EUR 9,230k per 31 December 2005 to EUR 19,553k per 31 December 2006.

Outlook 2007

The Contract Development order book is higher than at the same stage in 2006 and supports our revenue targets for 2007. The Company expects to generate more Contract Development revenues but expenditures will also increase as investments in the product pipeline continue. Major milestones to be expected in 2007 are the results from the ongoing Locteron Phase IIa trial, expected mid-2007, and the data for the ongoing OP-145 Phase II study, expected late 2007.

Annual report and Annual General Meeting of Shareholders

OctoPlus will publish its Annual Report 2006 on 30 March 2007. The report will also be available on the Company's website The Annual General Meeting of Shareholders will take place at Naturalis in Leiden on 24 April 2007 at 14:00 Central European Time (CET).

Conference call and webcast presentation

On February 15, OctoPlus will hold a conference call at 09:30 CET. This event can also be followed during a live audio webcast via OctoPlus' website If you would like to participate in the conference call, please dial in on telephone number +31 45 631 6903.

After the presentation of the results, Joost Holthuis, CEO of OctoPlus and Hans Pauli, CFO, will be available to answer questions. After the event, the webcast will be available for replay on the Company's website.

For further information, please contact: Rianne Roukema, Corporate Communications, +31 71 524 4044.

About OctoPlus

OctoPlus N.V. is a product-oriented biopharmaceutical company committed to the development of improved pharmaceutical products that are based on its proprietary drug delivery technologies and have fewer side effects, improved patient convenience and a better efficacy/safety balance than existing therapies. Rather than seeking to discover novel drug candidates through early stage research activities, OctoPlus focuses on the development of long-acting, controlled release versions of known protein therapeutics and other drugs.

OctoPlus is also a leading provider of advanced drug formulation and clinical scale manufacturing services to the pharmaceutical and biotechnology industry, with a focus on difficult to formulate active pharmaceutical ingredients in injectable formulations. The earnings and expertise that OctoPlus derives from rendering formulation and manufacturing services help to support its own drug development programs.

OctoPlus is listed on Euronext Amsterdam under the symbol OCTO. For more information about OctoPlus, please visit our website

This document may contain certain forward-looking statements relating to the business, financial performance and results of OctoPlus N.V. and the industry in which it operates. These statements are based on OctoPlus N.V.'s current plans, estimates and projections, as well as its expectations of external conditions and events. In particular the words "expect", "anticipate", "predict", "estimate", "project", "plan", "may", "should", "would", "will", "intend", "believe" and similar expressions are intended to identify forward-looking statements. We caution investors that a number of important factors, and the inherent risks and uncertainties that such statements involve, could cause actual results or outcomes to differ materially from those expressed in any forward-looking statements. In the event of any inconsistency between an English version and a Dutch version of this document, the English version will prevail over the Dutch version.

Consolidated balance sheet                          (In Euro x 1,000)

                                                       At 31 December
                                                2006             2005
Non-current assets
Intangible assets
Goodwill                                         243              243
Patents                                        1,217            1,167
Other intangible assets                          306              295
                                               1,766            1,705
Property, plant and equipment
Land and buildings                             3,128            3,246
Machines and installations                     2,747            2,499
Other equipment                                  475              528
                                               6,350            6,273
Financial assets carried at cost                  16               16
Long-term deposits                             1,000                -
                                               9,132            7,994
Current assets
Short-term deposits                           11,500                -
Inventories                                      498               15
Trade receivables                              1,139            1,345
Social security and other taxes                  377              255
Other receivables,  prepayments  and  accrued  1,085            1,165
Cash and cash equivalents                      8,535            9,726
                                              23,134           12,506
Total assets                                  32,266           20,500

Shareholders' equity                          21,142            7,766
Convertible subordinated loan                      -            3,985
Total group equity                            21,142           11,751

Non-current liabilities
Pension liabilities                                -               89
Finance lease liabilities                      3,592            3,649
Other non-current liabilities                     26                -
                                               3,618            3,738
Current liabilities
Current portion of non-current liabilities       164              142
Bank overdrafts                                1,482              496
Trade payables                                 2,468            1,491
Payable to related parties                        12                -
Social security and other taxes                  226              239
Other current liabilities                      3,154            2,643
                                               7,506            5,011
Total liabilities                             11,124            8,749
Total equity and liabilities                  32,266           20,500

Consolidated income
statement                                           (In Euro x 1,000)

                                 Six months ended          Year ended
                                      31 December         31 December
                                 2006        2005        2006    2005

Service revenues                2,430       3,263       5,587   6,563
Royalty   and   license           302          30         332      60
Income from subsidies              40         158         132     394
Total revenues                  2,772       3,451       6,051   7,017

Raw    materials    and            80         190         180     237
Cost of contracted work           781         974       1,928   1,390
and   other    external
Employee benefits               3,220       2,603       6,140   4,758
Depreciation        and           548         412       1,060     863
Other costs                     2,666       2,251       5,263   4,213
Total operating costs           7,295       6,430      14,571  11,461

Operating loss                (4,523)     (2,979)     (8,520) (4,444)

Interest income                   156         126         246     287
Interest costs                  (197)       (217)       (391)   (405)
Result before corporate       (4,564)     (3,070)     (8,665) (4,562)
income taxes

Corporate income taxes                                            353
                                   -           -           -
Result for the year           (4,564)     (3,070)     (8,665) (4,209)

Attributable to:
Equity holders  of  the       (4,564)     (3,070)     (8,665) (4,209)

Result per share for
result attributable to
equity holders of the
Company during the year
(expressed in Euro per
- basic                        (0.33)      (0.27)      (0.68)  (0.38)
- diluted                      (0.33)      (0.27)      (0.68)  (0.38)

Consolidated cash flow statement                    (In Euro x 1,000)

                                                           Year ended
                                                        31 December
                                                        2006     2005
Cash flows from operating activities
Result before corporate income taxes                 (8,665)  (4,562)
Adjustments for:
- Depreciation and amortisation                        1,060      863
- Share-based payments                                    90      132
- Interest costs                                         391      405
- Interest income                                      (246)    (287)
- Change in pension liability                           (89)     (42)
Changes in working capital:
- Inventories                                          (483)        -
- Trade receivables                                      206    (171)
- Payable to related parties                              12        3
- Social securities and other taxes                    (122)    (206)
- Other  receivables,  prepayments  and  accrued          80    (609)
- Trade payables                                         977      412
- Other liabilities and accruals                         498    (556)
Cash used in operations                              (6,291)  (4,618)
Increase in other non-current liabilities                 26        -
Interest received                                        246      287
Interest paid                                          (391)    (405)
Net cash used in operating activities                (6,410)  (4,736)

Cash flows from investing activities
Purchases of property, plant and equipment             (916)    (924)
Purchases of intangible assets                         (172)    (294)
Increase in long-term and short-term deposits       (12,500)        -
Net cash used in investing activities               (13,588)  (1,218)

Cash flows from financing activities
Proceeds from issuance of shares                      17,966   13,038
Proceeds   from    issuance    of    convertible           -    3,985
subordinated loan
Repayment of finance lease liabilities                 (145)    (163)
Net cash generated from financing activities          17,821   16,860

Cash, cash equivalents and bank overdrafts
Net increase/(decrease) during the year              (2,177)   10,906
Balance at beginning of the year                       9,230  (1,676)
Balance at end of the year                             7,053    9,230

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