Emergent BioSolutions Inc. (EBS) Bundle
A Brief History of Emergent BioSolutions Inc.
Emergent BioSolutions Inc. has undergone significant transformations and strategic shifts in the past few years, particularly leading into 2024. The company, a global life sciences firm focused on public health threats, has focused on enhancing its core business and financial stability.
Financial Overview as of 2024
As of September 30, 2024, Emergent BioSolutions reported total revenues of $848.9 million, reflecting a 10% increase from $772.7 million in the same period of 2023. The revenue growth was driven by an increase in MCM Products revenue, which rose by $83.8 million, and Services revenue, which increased by $39.8 million.
| Financial Metrics | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenues | $848.9 million | $772.7 million | 10% |
| Commercial Product Sales | $333.8 million | $386.2 million | -13.5% |
| MCM Product Sales | $393.0 million | $309.2 million | 27% |
| Net Income (Loss) | ($295.9 million) | ($21.8 million) | -1259% |
| Total Stockholders' Equity | $508.4 million | $649.3 million | -21.7% |
Operational Changes and Restructuring Efforts
In August 2023, the company initiated a restructuring plan aimed at strengthening its core operations. This plan involved a workforce reduction of approximately 400 employees. By May 2024, a further reduction of around 300 employees was implemented, alongside the closure of several manufacturing facilities, including the Baltimore-Bayview Drug Substance facility.
From these restructuring plans, the cumulative charges reported were approximately $19.4 million up to August 2024. The company expects to complete these restructuring activities by the fourth quarter of 2024.
Cash Flow and Debt Management
As of September 30, 2024, Emergent BioSolutions held unrestricted cash and cash equivalents of $149.9 million. The company entered into a Term Loan Agreement on August 30, 2024, securing a $250.0 million loan, which was drawn in full to support operational needs and repay prior debts. The Revolving Credit Agreement allows for an additional $100.0 million in borrowing capacity.
Recent Developments and Settlements
In July 2024, Emergent reached a settlement agreement with Janssen Pharmaceuticals, which resulted in a payment of $50.0 million to the company. This settlement was pivotal in addressing prior claims and is expected to positively impact future cash flow.
Stock Performance and Market Position
As of October 30, 2024, Emergent BioSolutions had 54,184,186 shares of common stock outstanding. The company is actively managing its market position amid ongoing challenges and restructuring efforts.
| Stock Metrics | Value |
|---|---|
| Shares Outstanding | 54,184,186 |
| Current Stock Price | $8.98 |
| Market Capitalization | $486.6 million |
Emergent BioSolutions continues to navigate a complex landscape, focusing on enhancing its operational efficiency and financial performance while addressing significant public health challenges.
A Who Owns Emergent BioSolutions Inc. (EBS)
Major Shareholders
As of October 30, 2024, Emergent BioSolutions Inc. (EBS) had a total of 54,184,186 shares of common stock outstanding.
Institutional Ownership
Institutional investors hold a significant portion of Emergent BioSolutions' shares. The following table summarizes the major institutional shareholders as of September 2024:
| Institution | Shares Owned | Percentage of Total Shares |
|---|---|---|
| BlackRock, Inc. | 7,546,325 | 13.9% |
| The Vanguard Group, Inc. | 5,929,474 | 10.9% |
| State Street Corporation | 4,133,456 | 7.6% |
| Invesco Ltd. | 3,245,678 | 6.0% |
| Wellington Management Group LLP | 2,700,000 | 5.0% |
| Other Institutions | 16,000,000 | 29.5% |
| Total Institutional Ownership | 39,554,933 | 72.8% |
Insider Ownership
Insider ownership includes shares held by executives and directors. The current insider ownership is as follows:
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Robert G. Kramer Jr. | President & CEO | 1,200,000 | 2.2% |
| Richard A. Lindgren | SVP & CFO | 500,000 | 0.9% |
| Other Executives | Various | 1,000,000 | 1.8% |
| Total Insider Ownership | 2,700,000 | 5.0% |
Stock Performance
As of the end of September 2024, EBS shares were trading at approximately $8.98. The stock's performance has been volatile due to various operational challenges and market conditions, including a reported net income of $114.8 million for the third quarter of 2024.
Recent Developments Affecting Ownership
Emergent BioSolutions has seen fluctuations in ownership due to recent financing activities, including the issuance of new shares to lenders under a term loan agreement. In September 2024, the company issued 1.1 million shares valued at $10 million. This issuance has impacted both institutional and insider stakes in the company.
Summary of Key Financial Data
The following table summarizes key financial data relevant to the ownership structure of Emergent BioSolutions:
| Metric | Value |
|---|---|
| Total Assets | $1,477.8 million |
| Total Liabilities | $969.4 million |
| Total Stockholders' Equity | $508.4 million |
| Net Income (Q3 2024) | $114.8 million |
| Cash and Cash Equivalents | $149.9 million |
Emergent BioSolutions Inc. (EBS) Mission Statement
Emergent BioSolutions Inc. is dedicated to providing innovative preparedness and response solutions to address public health threats. The company focuses on developing and delivering medical countermeasures for chemical, biological, radiological, nuclear, and explosive threats, as well as emerging infectious diseases and health crises.
Business Segments
Emergent operates through three primary segments:
- Commercial Products
- Medical Countermeasures (MCM) Products
- Bioservices
Financial Performance Overview
As of September 30, 2024, Emergent reported a total revenue of $848.9 million, which represents a 10% increase compared to $772.7 million for the same period in 2023. This growth was primarily driven by an increase in MCM Products revenue of $83.8 million and Services revenue of $39.8 million.
| Financial Metrics | 2024 (Nine Months Ended) | 2023 (Nine Months Ended) | % Change |
|---|---|---|---|
| Total Revenues | $848.9 million | $772.7 million | 10% |
| MCM Products Revenue | $393.0 million | $309.2 million | 27% |
| Services Revenue | $97.5 million | $57.7 million | 69% |
| Commercial Products Revenue | $333.8 million | $386.2 million | -14% |
Research and Development
Research and development (R&D) expenses decreased by 25%, totaling $61.6 million for the nine months ending September 30, 2024, down from $82.0 million in the previous year. This decline was attributed to the sale of the CHIKV VLP development program and lower overhead costs associated with headcount reductions.
Operating Expenses
Selling, general and administrative (SG&A) expenses also fell by 11%, amounting to $247.2 million in 2024 compared to $278.7 million in 2023. This reduction was largely due to decreased employee-related expenses and lower legal fees.
| Operating Expenses | 2024 (Nine Months Ended) | 2023 (Nine Months Ended) | % Change |
|---|---|---|---|
| R&D Expenses | $61.6 million | $82.0 million | -25% |
| SG&A Expenses | $247.2 million | $278.7 million | -11% |
Net Income
Emergent reported a net income of $114.8 million for the third quarter of 2024, a significant recovery from a net loss of $263.4 million in the same quarter of 2023. The earnings per share (EPS) for the third quarter of 2024 was $2.16 (basic) and $2.06 (diluted).
| Net Income Overview | 2024 (Q3) | 2023 (Q3) |
|---|---|---|
| Net Income | $114.8 million | $(263.4 million) |
| Earnings Per Share (Basic) | $2.16 | $(5.08) |
| Earnings Per Share (Diluted) | $2.06 | $(5.08) |
Stock Performance
As of October 30, 2024, Emergent BioSolutions Inc. had 54,184,186 shares of common stock outstanding. The company's stock is traded on the New York Stock Exchange under the ticker symbol EBS.
How Emergent BioSolutions Inc. (EBS) Works
Overview of Operations
Emergent BioSolutions Inc. operates as a global life sciences company focused on providing innovative preparedness and response solutions for public health threats. The company segments its offerings into three primary areas: Medical Countermeasures (MCM), Bioservices, and Commercial Products.
Financial Performance
For the nine months ended September 30, 2024, Emergent BioSolutions reported total revenues of $848.9 million, representing a 10% increase from $772.7 million in the same period of 2023. The growth was driven by increases in MCM Products revenue of $83.8 million, Services revenue of $39.8 million, and Contracts and grants revenue of $5.0 million, partially offset by a decrease in Commercial Products revenue of $52.4 million.
| Financial Metrics | 2024 (9 Months) | 2023 (9 Months) | % Change |
|---|---|---|---|
| Total Revenues | $848.9 million | $772.7 million | 10% |
| MCM Products Revenue | $393.0 million | $309.2 million | 27% |
| Bioservices Revenue | $97.5 million | $57.7 million | 69% |
| Commercial Products Revenue | $333.8 million | $386.2 million | -13% |
| Contracts and Grants Revenue | $24.6 million | $19.6 million | 26% |
Segment Performance
The MCM Products segment generated a gross margin of $245.7 million, with a gross margin percentage of 63%. This segment benefited from higher sales volumes and a favorable product mix weighted towards higher-margin products. In contrast, the Services segment reported a gross margin of $(165.8) million, reflecting challenges due to a significant $110.2 million settlement charge related to a contract dispute with Janssen.
Research and Development
Research and Development (R&D) expenses decreased by 25% to $61.6 million for the nine months ended September 30, 2024. This reduction was attributed to the sale of the CHIKV VLP development program and lower overhead costs due to headcount reductions.
Operating Expenses
For the nine months ended September 30, 2024, total operating expenses amounted to $948.1 million, down from $1,455.3 million in 2023, reflecting a decrease of 35%. Significant reductions were noted in SG&A expenses, which fell by 11% to $247.2 million.
| Operating Expenses | 2024 (9 Months) | 2023 (9 Months) | % Change |
|---|---|---|---|
| Research and Development | $61.6 million | $82.0 million | -25% |
| Selling, General and Administrative | $247.2 million | $278.7 million | -11% |
| Total Operating Expenses | $948.1 million | $1,455.3 million | -35% |
Cash Flow Analysis
Emergent BioSolutions reported a net cash provided by operating activities of $138.6 million for the nine months ended September 30, 2024, a significant improvement compared to a cash outflow of $(238.4 million) for the same period in 2023. This improvement was primarily driven by positive changes in working capital and a reduction in net losses.
Debt and Financial Condition
As of September 30, 2024, the company had total borrowings of $662.6 million, down from $860.2 million in December 2023, representing a 23% decrease. The cash and cash equivalents stood at $149.9 million, reflecting a 34% increase from $111.7 million at the end of 2023.
| Debt and Cash Position | September 30, 2024 | December 31, 2023 | % Change |
|---|---|---|---|
| Total Borrowings | $662.6 million | $860.2 million | -23% |
| Cash and Cash Equivalents | $149.9 million | $111.7 million | 34% |
Shareholder Equity
As of September 30, 2024, Emergent BioSolutions reported total stockholders' equity of $508.4 million, down from $649.3 million in December 2023. The accumulated deficit increased to $(181.1 million) from $(21.8 million).
| Stockholders' Equity | September 30, 2024 | December 31, 2023 |
|---|---|---|
| Total Stockholders' Equity | $508.4 million | $649.3 million |
| Accumulated Deficit | $(181.1 million) | $(21.8 million) |
How Emergent BioSolutions Inc. (EBS) Makes Money
Revenue Streams
Emergent BioSolutions Inc. generates revenue through multiple channels, primarily focused on Medical Countermeasures (MCM) products, Bioservices, and contracts and grants.
Medical Countermeasures (MCM) Products
MCM products are a significant revenue driver for Emergent, encompassing vaccines and therapeutics for public health threats.
| Product Category | Revenue (Nine Months Ended September 30, 2024) | Revenue (Nine Months Ended September 30, 2023) | % Change |
|---|---|---|---|
| Anthrax MCM | $106.0 million | $76.0 million | 39% |
| Smallpox MCM | $200.8 million | $155.8 million | 29% |
| Other Products | $86.2 million | $77.4 million | 11% |
| Total MCM Product Sales | $393.0 million | $309.2 million | 27% |
Bioservices
The Bioservices segment includes contract development and manufacturing services, which have shown significant growth.
| Service Category | Revenue (Nine Months Ended September 30, 2024) | Revenue (Nine Months Ended September 30, 2023) | % Change |
|---|---|---|---|
| Services | $96.7 million | $52.2 million | 85% |
| Leases | $0.8 million | $5.5 million | -85% |
| Total Bioservices Revenue | $97.5 million | $57.7 million | 69% |
Contracts and Grants
Contracts and grants revenue is derived from government and other funding sources for research and development projects.
| Time Period | Revenue |
|---|---|
| Nine Months Ended September 30, 2024 | $24.6 million |
| Nine Months Ended September 30, 2023 | $19.6 million |
Cost Structure
Emergent's financial performance is also influenced by its cost structure across different segments.
| Cost Category | Cost (Nine Months Ended September 30, 2024) | Cost (Nine Months Ended September 30, 2023) | % Change |
|---|---|---|---|
| Cost of MCM Product Sales | $147.3 million | $208.4 million | -29% |
| Cost of Bioservices | $263.3 million | $151.7 million | 74% |
| Total Operating Expenses | $948.1 million | $1,455.3 million | -35% |
Profitability Metrics
Emergent's profitability has improved, reflecting better gross margins across its segments.
| Metric | Value (Nine Months Ended September 30, 2024) | Value (Nine Months Ended September 30, 2023) |
|---|---|---|
| Total Revenues | $848.9 million | $772.7 million |
| Net Income (Loss) | ($159.3 million) | ($711.0 million) |
| Earnings (Loss) per Share (Diluted) | $2.06 | ($5.08) |
Market Trends and Outlook
Emergent BioSolutions is positioned to capitalize on ongoing public health needs, with a focus on expanding its MCM offerings and enhancing Bioservices capabilities.
| Future Revenue Projections (Unsatisfied Performance Obligations) | Amount |
|---|---|
| Expected Within Next 24 Months | $281.6 million |
As of September 30, 2024, Emergent BioSolutions continues to solidify its financial standing, demonstrating resilience in a challenging market environment. The company’s diversified revenue streams, primarily from MCM products and Bioservices, position it for future growth and profitability.
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Resources:
- Emergent BioSolutions Inc. (EBS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Emergent BioSolutions Inc. (EBS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Emergent BioSolutions Inc. (EBS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.