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Actionable news in UTHR: United Therapeutics Corporation,

FORM 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2017

OR

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from to

Commission file number 0-26301

United Therapeutics Corporation

(Exact Name of Registrant as Specified in Its Charter)

Delaware

52-1984749

(State or Other Jurisdiction of

(I.R.S. Employer

Incorporation or Organization)

Identification No.)

1040 Spring Street, Silver Spring, MD

20910

(Address of Principal Executive Offices)

(Zip Code)

(301) 608-9292

(Registrant’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer x

Accelerated filer o

Non-accelerated filer o

Smaller reporting company o

(do not check if a smaller reporting company)

Emerging growth company o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The number of shares outstanding of the issuer’s common stock, par value $.01 per share, as of October 18, 2017 was 43,211,053.

Page

Part I.

FINANCIAL INFORMATION (UNAUDITED)

3

Item 1.

Consolidated Financial Statements

3

Consolidated Balance Sheets

3

Consolidated Statements of Operations

4

Consolidated Statements of Comprehensive Income

5

Consolidated Statements of Cash Flows

6

Notes to Consolidated Financial Statements

7

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

20

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

33

Item 4.

Controls and Procedures

33

Part II.

OTHER INFORMATION

34

Item 1.

Legal Proceedings

34

Item 1A.

Risk Factors

34

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

47

Item 6.

Exhibits

48

SIGNATURES

49

2

PART I. FINANCIAL INFORMATION

Item 1. CONSOLIDATED FINANCIAL STATEMENTS

UNITED THERAPEUTICS CORPORATION

CONSOLIDATED BALANCE SHEETS

(In millions, except share data)

September 30,
2017

December 31,
2016

(Unaudited)

Assets

Current assets:

Cash and cash equivalents

$

1,067.5

$

1,023.0

Marketable investments

143.2

27.8

Accounts receivable, no allowance for 2017 and 2016

251.8

214.5

Inventories, net

114.4

100.0

Other current assets

62.3

59.5

Total current assets

1,639.2

1,424.8

Marketable investments

338.5

2.3

Goodwill and other intangible assets, net

45.7

33.8

Property, plant and equipment, net

521.7

489.3

Deferred tax assets, net

177.9

178.3

Other non-current assets

213.0

197.1

Total assets

$

2,936.0

$

2,325.6

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable and accrued expenses

$

143.3

$

104.2

Line of credit

250.0

Share tracking awards plan

145.1

194.8

Other current liabilities

251.0

33.5

Total current liabilities

789.4

332.5

Non-current liabilities

57.5

130.9

Total liabilities

846.9

463.4

Commitments and contingencies

Temporary equity

19.2

10.9

Stockholders’ equity:

Preferred stock, par value $.01, 10,000,000 shares authorized, no shares issued

Series A junior participating preferred stock, par value $.01, 100,000 shares authorized, no shares issued

Common stock, par value $.01, 245,000,000 shares authorized, 69,825,916 and 69,340,985 shares issued, and 43,206,700 and 42,965,856 shares outstanding at September 30, 2017 and December 31, 2016, respectively

0.7

0.7

Additional paid-in capital

1,838.6

1,813.5

Accumulated other comprehensive loss

(16.8

)

(16.8

)

Treasury stock, 26,619,216 and 26,375,129 shares at September 30, 2017 and December 31, 2016, respectively

(2,579.2

)

(2,379.6

)

Retained earnings

2,826.6

2,433.5

Total stockholders’ equity

2,069.9

1,851.3

Total liabilities and stockholders’ equity

$

2,936.0

$

2,325.6

See accompanying notes to consolidated financial statements.

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