Depomed Announces Intent to Effect a Debt Refinancing
July 13 2017 - 8:00AM
Depomed Inc. (NASDAQ:DEPO) (the “Company”) today announced that it
is seeking to refinance its existing $375 million principal amount
of privately placed secured Senior Notes. The existing notes are
due in 2022 and have a coupon of 9.75% over three-month LIBOR
(currently 1.30%). The existing note financing was provided by
Deerfield and Pharmakon Advisors, LP.
The consummation and actual terms of the proposed refinancing
are subject to a number of factors, including market conditions,
negotiation and execution of definitive agreements and satisfaction
of customary closing conditions. There can be no assurance that the
refinancing will occur, or, if it does, as to the terms of the
refinancing.
Preliminary Second Quarter 2017 Financial Results
In connection with the proposed debt refinancing, Depomed today
announced selected preliminary financial results for the quarter
ended June 30, 2017 and reconfirmed its full year guidance.
The Company currently expects net sales to be in the range of
approximately $98 million to $103 million for the quarter ended
June 30, 2017. The Company also expects non-GAAP Adjusted EBITDA
for the second quarter to be in the range of approximately $23
million to $28 million.i Cash and investments as of June 30,
2017 were approximately $117 million. Depomed currently expects to
report its full second quarter 2017 financial results in early
August.
“Our second quarter performance marked an improvement over our
first quarter and was consistent with our expectations,” said
Arthur Higgins, President and CEO of Depomed. “We believe that in
light of the quarter’s performance we are on track to achieve our
previously stated financial guidance for the full year. Refinancing
our debt is an important 2017 goal and we expect that we will be
able to refinance on significantly more favorable terms given our
solid net sales and EBITDA. Our intent is to close the refinancing
during the quarter.”
About Depomed
Depomed is a leading specialty pharmaceutical company focused on
enhancing the lives of the patients, families, physicians,
providers and payors we serve through commercializing innovative
products for pain and neurology related disorders. Depomed markets
six medicines with areas of focus that include mild to severe acute
pain, moderate to severe chronic pain, neuropathic pain, migraine
and breakthrough cancer pain. Depomed is headquartered in Newark,
California. To learn more about Depomed, visit www.depomed.com.
"Safe Harbor" Statement under the Private Securities Litigation
Reform Act of 1995. The statements that are not historical facts
contained in this release are forward-looking statements that
involve risks and uncertainties including, but not limited to,
those related to our expectations regarding a potential refinancing
transaction, Depomed's financial outlook for 2017 and expectations
regarding financial results (including results for the second
quarter of 2017) and potential business opportunities and other
risks detailed in the Company's Securities and Exchange Commission
filings, including the Company's most recent Annual Report on Form
10-K and most recent Quarterly Report on Form 10-Q. The inclusion
of forward-looking statements should not be regarded as a
representation that any of the Company's plans or objectives will
be achieved. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date hereof.
The Company undertakes no obligation to publicly release the result
of any revisions to these forward-looking statements that may be
made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
______________________
i The Company is currently not providing preliminary GAAP
net loss ranges as it is still evaluating its non-recurring charges
for the quarter ended June 30, 2017.
Investor Contact:
Christopher Keenan
VP, Investor Relations and Corporate Communications
510-744-8000
ckeenan@depomed.com
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