10-Q 1 rgen-20210930.htm 10-Q 10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

For the quarterly period ended September 30, 2021

OR

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 000-14656

 

REPLIGEN CORPORATION

(Exact Name of Registrant as Specified in its Charter)

 

 

 

 

Delaware

04-2729386

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

 

 

41 Seyon Street, Bldg. 1, Suite 100

Waltham, MA

02453

(Address of Principal Executive Offices)

(Zip Code)

 

(781) 250-0111

Registrant’s Telephone Number, Including Area Code

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

 

 

 

Common Stock, par value $0.01 per share

RGEN

The Nasdaq Global Select Market

 

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 No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a 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

Accelerated filer

 

 

 

 

Non-accelerated filer

Smaller reporting company

 

 

 

 

Emerging growth company

 

 

 

1


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.

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

The number of shares outstanding of the registrant’s common stock on October 25, 2021 was 55,288,528.

 

 

2


Table of Contents

 

 

 

 

 

 

PAGE

 

 

 

 

PART I -

FINANCIAL INFORMATION

 

 

 

 

Item 1.

Financial Statements (interim periods unaudited)

 

 

 

 

 

Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020

4

 

 

 

 

Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2021 and 2020

5

 

 

 

 

Consolidated Statements of Stockholders’ Equity for the Three and Nine Months Ended September 30, 2021 and 2020

6

 

 

 

 

Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2021 and 2020

7

 

 

 

 

Notes to Unaudited Consolidated Financial Statements

8

 

 

 

Item 2.

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

28

 

 

 

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

38

 

 

 

Item 4.

Controls and Procedures

38

 

 

 

PART II -

OTHER INFORMATION

 

 

 

 

Item 1.

Legal Proceedings

40

 

 

 

Item 1A.

Risk Factors

40

 

 

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

40

 

 

 

Item 3.

Defaults Upon Senior Securities

40

 

 

 

Item 4.

Mine Safety Disclosures

40

 

 

 

Item 5.

Other Information

40

 

 

 

Item 6.

Exhibits

41

 

 

Signatures

42

 

 

 

3


PART I – FINANCIAL INFORMATION

 

ITEM 1. Financial Statements

 

REPLIGEN CORPORATION

CONSOLIDATED BALANCE SHEETS

(Unaudited, amounts in thousands, except share data)

 

 

 

September 30,

 

 

December 31,

 

 

 

2021

 

 

2020

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

621,098

 

 

$

717,292

 

Accounts receivable, net of reserves of $1,214 and $762 at September 30, 2021
     and December 31, 2020, respectively

 

 

122,048

 

 

 

71,389

 

Inventories, net

 

 

156,163

 

 

 

95,025

 

Prepaid expenses and other current assets

 

 

11,545

 

 

 

18,676

 

Total current assets

 

 

910,854

 

 

 

902,382

 

Noncurrent assets:

 

 

 

 

 

 

Property, plant and equipment, net

 

 

99,652

 

 

 

66,870

 

Intangible assets, net

 

 

340,163

 

 

 

287,100

 

Goodwill

 

 

833,559

 

 

 

618,305

 

Deferred tax assets

 

 

1,542

 

 

 

2,481

 

Operating lease right of use assets

 

 

55,007

 

 

 

25,176

 

Other noncurrent assets

 

 

620

 

 

 

573

 

Total noncurrent assets

 

 

1,330,543

 

 

 

1,000,505

 

Total assets

 

$

2,241,397

 

 

$

1,902,887

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

28,194

 

 

$

16,880

 

Operating lease liability

 

 

5,528

 

 

 

5,254

 

Accrued liabilities

 

 

63,394

 

 

 

53,085

 

Convertible senior notes, current portion, net

 

 

252,323

 

 

 

243,737

 

Total current liabilities

 

 

349,439

 

 

 

318,956

 

Noncurrent liabilities:

 

 

 

 

 

 

Deferred tax liabilities

 

 

39,125

 

 

 

27,032

 

Noncurrent operating lease liability

 

 

55,909

 

 

 

26,425

 

Noncurrent contingent consideration

 

 

79,962

 

 

 

 

Other noncurrent liabilities

 

 

1,697

 

 

 

1,324

 

Total noncurrent liabilities

 

 

176,693

 

 

 

54,781

 

Total liabilities

 

 

526,132

 

 

 

373,737

 

Commitments and contingencies (Note 9)

 

 

 

 

 

 

Stockholders' equity:

 

 

 

 

 

 

Preferred stock, $0.01 par value, 5,000,000 shares authorized, no shares issued or outstanding

 

 

 

 

 

 

Common stock, $0.01 par value; 80,000,000 shares authorized; 55,283,988 shares at
     September 30, 2021 and
54,760,837 shares at December 31, 2020 issued and
     outstanding

 

 

553

 

 

 

548

 

Additional paid-in capital

 

 

1,559,681

 

 

 

1,460,748

 

Accumulated other comprehensive (loss) income

 

 

(9,919

)

 

 

2,085

 

Retained earnings

 

 

164,950

 

 

 

65,769

 

Total stockholders’ equity

 

 

1,715,265

 

 

 

1,529,150

 

Total liabilities and stockholders’ equity

 

$

2,241,397

 

 

$

1,902,887

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

4


REPLIGEN CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited, amounts in thousands, except per share data)

 

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Products

 

$

178,177

 

 

$

94,029

 

 

$

483,834

 

 

$

257,521

 

Royalty and other revenue

 

 

39

 

 

 

31

 

 

 

179

 

 

 

91

 

Total revenue

 

 

178,216

 

 

 

94,060

 

 

 

484,013

 

 

 

257,612

 

Costs and operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Cost of product revenue

 

 

75,495

 

 

 

39,626

 

 

 

197,232

 

 

 

108,471

 

Research and development

 

 

9,154

 

 

 

4,422

 

 

 

25,155

 

 

 

13,460

 

Selling, general and administrative

 

 

48,373

 

 

 

29,051

 

 

 

131,809

 

 

 

83,277

 

Total costs and operating expenses

 

 

133,022

 

 

 

73,099

 

 

 

354,196

 

 

 

205,208

 

Income from operations

 

 

45,194

 

 

 

20,961

 

 

 

129,817

 

 

 

52,404

 

Other income (expenses):

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

44

 

 

 

82

 

 

 

137

 

 

 

1,699

 

Interest expense

 

 

(3,220

)

 

 

(3,052

)

 

 

(9,470

)

 

 

(9,032

)

Other expenses

 

 

(786

)

 

 

(248

)

 

 

(1,789

)

 

 

(632

)

Other expenses, net

 

 

(3,962

)

 

 

(3,218

)

 

 

(11,122

)

 

 

(7,965

)

Income before income taxes

 

 

41,232

 

 

 

17,743

 

 

 

118,695

 

 

 

44,439

 

Income tax provision

 

 

7,734

 

 

 

3,191

 

 

 

19,514

 

 

 

4,211

 

Net income

 

$

33,498

 

 

$

14,552

 

 

$

99,181

 

 

$

40,228

 

Earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.61

 

 

$

0.28

 

 

$

1.81

 

 

$

0.77

 

Diluted

 

$

0.58

 

 

$

0.27

 

 

$

1.74

 

 

$

0.75

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

55,015

 

 

 

52,545

 

 

 

54,918

 

 

 

52,341

 

Diluted

 

 

57,368

 

 

 

53,469

 

 

 

57,072

 

 

 

53,300

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

33,498

 

 

$

14,552

 

 

$

99,181

 

 

$

40,228

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustment

 

 

(5,550

)

 

 

4,390

 

 

 

(12,004

)

 

 

5,304

 

Comprehensive income

 

$

27,948

 

 

$

18,942

 

 

$

87,177

 

 

$

45,532

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The accompanying notes are an integral part of these consolidated financial statements.

5


REPLIGEN CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited, amounts in thousands, except share data)

 

 

 

Nine Months Ended September 30, 2021

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of
Shares

 

 

Par
Value

 

 

Additional
Paid-In Capital

 

 

Accumulated
Other Comprehensive
Income (Loss)

 

 

Retained
Earnings

 

 

Total
Stockholders'
Equity

 

Balance at December 31, 2020

 

 

54,760,837

 

 

$

548

 

 

$

1,460,748

 

 

$

2,085

 

 

$

65,769

 

 

$

1,529,150

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

99,181

 

 

 

99,181

 

Issuance of common stock for debt conversion

 

 

7

 

 

 

0

 

 

 

2

 

 

 

 

 

 

 

 

 

2

 

Exercise of stock options and vesting of stock
   units

 

 

257,387

 

 

 

2

 

 

 

1,989

 

 

 

 

 

 

 

 

 

1,991

 

Issuance of common stock pursuant to the acquisition
    of Avitide Inc.

 

 

271,096

 

 

 

3

 

 

 

77,573

 

 

 

 

 

 

 

 

 

77,576

 

Tax withholding on vesting of restricted stock units

 

 

(5,339

)

 

 

(0

)

 

 

(1,252

)

 

 

 

 

 

 

 

 

(1,252

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

20,476

 

 

 

 

 

 

 

 

 

20,476

 

True up of costs related to the December 2020
   issuance of common stock

 

 

 

 

 

 

 

 

145

 

 

 

 

 

 

 

 

 

145

 

Translation adjustment

 

 

 

 

 

 

 

 

 

 

 

(12,004

)

 

 

 

 

 

(12,004

)

Balance at September 30, 2021

 

 

55,283,988

 

 

$

553

 

 

$

1,559,681

 

 

$

(9,919

)

 

$

164,950

 

 

$

1,715,265

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2021

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of
Shares

 

 

Par
Value

 

 

Additional
Paid-In Capital

 

 

Accumulated
Other Comprehensive
Loss

 

 

Retained
Earnings

 

 

Total
Stockholders'
Equity

 

Balance at June 30, 2021

 

 

54,969,481

 

 

$

550

 

 

$

1,475,436

 

 

$

(4,369

)

 

$

131,452

 

 

$

1,603,069

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

33,498

 

 

 

33,498

 

Issuance of common stock for debt conversion

 

 

4

 

 

 

0

 

 

 

1

 

 

 

 

 

 

 

 

 

1

 

Exercise of stock options and vesting of stock
   units

 

 

48,746

 

 

 

0

 

 

 

1,131

 

 

 

 

 

 

 

 

 

1,131

 

Issuance of common stock pursuant to the acquisition
   of Avitide Inc.

 

 

271,096

 

 

 

3

 

 

 

77,573

 

 

 

 

 

 

 

 

 

77,576

 

Tax withholding on vesting of restricted stock units

 

 

(5,339

)

 

 

(0

)

 

 

(1,252

)

 

 

 

 

 

 

 

 

(1,252

)

Stock-based compensation expense

 

 

 

 

 

 

 

 

6,792

 

 

 

 

 

 

 

 

 

6,792

 

Translation adjustment

 

 

 

 

 

 

 

 

 

 

 

(5,550

)

 

 

 

 

 

(5,550

)

Balance at September 30, 2021

 

 

55,283,988

 

 

$

553

 

 

$

1,559,681

 

 

$

(9,919

)

 

$

164,950

 

 

$

1,715,265

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2020

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of
Shares

 

 

Par
Value

 

 

Additional
Paid-In Capital

 

 

Accumulated
Other Comprehensive
Loss

 

 

Retained
Earnings

 

 

Total
Stockholders'
Equity

 

Balance at December 31, 2019

 

 

52,078,258

 

 

$

521

 

 

$

1,068,431

 

 

$

(15,027

)

 

$

5,843

 

 

$

1,059,768

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

40,228

 

 

 

40,228

 

Exercise of stock options and vesting of stock
   units

 

 

528,442

 

 

 

5

 

 

 

7,073

 

 

 

 

 

 

 

 

 

7,078

 

Stock-based compensation expense

 

 

 

 

 

 

 

 

12,492

 

 

 

 

 

 

 

 

 

12,492

 

Translation adjustment

 

 

 

 

 

 

 

 

 

 

 

5,304

 

 

 

 

 

 

5,304

 

Balance as of September 30, 2020

 

 

52,606,700

 

 

$

526

 

 

$

1,087,996

 

 

$

(9,723

)

 

$

46,071

 

 

$

1,124,870

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2020

 

 

 

Common Stock

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Number of
Shares

 

 

Par
Value

 

 

Additional
Paid-In Capital

 

 

Accumulated
Other Comprehensive
Loss

 

 

Retained
Earnings

 

 

Total
Stockholders'
Equity

 

Balance at June 30, 2020

 

 

52,494,884

 

 

$

525

 

 

$

1,082,096

 

 

$

(14,113

)

 

$

31,519

 

 

$

1,100,027

 

Net income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

14,552

 

 

 

14,552

 

Exercise of stock options and vesting of stock
   units

 

 

111,816

 

 

 

1

 

 

 

1,675

 

 

 

 

 

 

 

 

 

1,676