EXHIBIT 99.1
FOR IMMEDIATE RELEASE
IVAX ANNOUNCES 1997 FIRST QUARTER RESULTS
STRATEGIC DISPOSITIONS MOVING FORWARD
FROST TO NAME STRAUSS AS CEO LATER THIS YEAR
Miami, Florida -- May 6, 1997 -- IVAX Corporation (AMEX:IVX) today
reported financial results for the quarter ended March 31, 1997.
Net loss per share for the 1997 first quarter was $.07, compared to a
net loss per share of $.02 in the 1996 fourth quarter and net earnings per share
of $.30 in the 1996 first quarter. Net loss for the 1997 first quarter was $7.9
million, compared to a net loss of $2.0 million in the 1996 fourth quarter and
net income of $35.9 million in the 1996 first quarter. Net revenues for the 1997
first quarter were $284.6 million, compared to $320.7 million in the 1996 fourth
quarter and $334.0 million in the 1996 first quarter. Gross profit for the 1997
first quarter was $101.6 million, compared to $118.7 million in the 1996 fourth
quarter and $144.5 million in the 1996 first quarter.
The 1996 fourth quarter results included the recognition of $26.5
million in income under a license agreement relating to IVAX' Easi-Breathe(TM)
inhaler.
"Although we continue to face challenges in the U.S. generic drug
industry, in the first quarter we saw two encouraging trends continue from the
1996 fourth quarter," said Michael W. Fipps, IVAX' Chief Financial Officer.
"First, although prices for our products declined, we did not experience the
extreme declines that we saw in mid-1996. This is due in part to the fact that
we deliberately cut back our price discounts and buy-in incentives. Second, and
as a result of these cut backs, our customer inventories have continued to
decline. They now stand at levels that we are comfortable with under the present
circumstances in our competitive industry. While the reduction of discounts and
incentives did restrain sales in the quarter, we believe this pricing discipline
was vital to improving our business."
Robert C. Strauss, IVAX' President and Chief Operating Officer added:
"Our U.S. generic drug business has improved from mid-1996 but, like all generic
drug companies, profitability ultimately will be driven in part by something not
entirely within IVAX' control -- the timely receipt of new generic drug
approvals. Something that IS within IVAX' control, however, is the recognition
of shareholder value through the sale of non-strategic businesses. I have the
direction and support of our Board and our Chairman to take all appropriate
action to recognize this value quickly as we
IVAX Corporation Press Release
April 6, 1997
Page 2
narrow and define IVAX' strategic focus. This is our top priority, and the
entire IVAX management team is driving hard to accomplish this goal."
"We are undergoing many important transitions at IVAX," said Phillip
Frost, M.D., IVAX' Chairman and Chief Executive Officer. "Existing operations
are in transition as we work to return our U.S. generics business to its
leadership position in the industry. Our revenue base is in transition as we
gradually move towards the more dependable profitability of proprietary drugs.
Most fundamentally, our strategic vision is in transition as we constructively
challenge every assumption upon which we built this company. In his two months
as President, Bob Strauss has made great strides in furthering this process. In
that short time, my high regard for his leadership has been further elevated,
and he has earned the trust and respect of our management team through his hard
work, good ideas and common sense style. I have determined that, ten years after
founding IVAX, it is time to initiate yet another transition. In this regard, I
will be recommending that Bob be appointed to the office of CEO, effective later
this year at IVAX' annual shareholders' meeting. I will continue to serve as
IVAX' Chairman, and in that role will maintain active involvement in the
direction and future success of IVAX."
IVAX Corporation, headquartered in Miami Florida, is a holding company
with subsidiaries engaged primarily in the research, development, manufacture
and marketing of health care products, including generic and branded
pharmaceuticals, intravenous solutions and related products, and IN VITRO
diagnostics.
EXCEPT FOR THE HISTORICAL MATTERS CONTAINED HEREIN, STATEMENTS IN THIS
PRESS RELEASE ARE FORWARD LOOKING AND ARE MADE PURSUANT TO THE SAFE HARBOR
PROVISIONS OF THE SECURITIES LITIGATION REFORM ACT OF 1995. INVESTORS ARE
CAUTIONED THAT FORWARD LOOKING STATEMENTS INVOLVE RISKS AND UNCERTAINTIES WHICH
MAY AFFECT THE COMPANY'S BUSINESS AND PROSPECTS, INCLUDING ECONOMIC,
COMPETITIVE, GOVERNMENTAL, TECHNOLOGICAL AND OTHER FACTORS DISCUSSED IN IVAX'
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.
CONTACTS:
Michael W. Fipps - or - Joseph C. Jones
Senior Vice President - Finance Vice President -
and Chief Financial Officer Corporate Communications
305-575-6123 305-575-6042
IVAX CORPORATION PRESS RELEASE
MAY 6, 1997
PAGE 3 OF 4
RESULTS OF OPERATIONS THREE MONTHS
PERIOD ENDED MARCH 31, 1997 1996
-------- --------
(In thousands, except per share data)
Net revenues $284,550 $334,045
Cost of sales 182,985 189,570
-------- --------
Gross profit 101,565 144,475
Selling, general and administrative 89,934 79,463
Research and development 16,873 16,522
Amortization 2,006 2,563
Merger expenses 2,095 184
-------- --------
Total operating expenses 110,908 98,732
-------- --------
Income (loss) from operations (9,343) 45,743
Total other income (expense), net (345) (1,530)
-------- --------
Income (loss) before income taxes,
minority interest and
extraordinary items (9,688) 44,213
Provision (benefit) for income taxes (3,221) 6,133
-------- --------
Income (loss) before minority interest and
extraordinary items (6,467) 38,080
Minority interest (1,472) (2,184)
-------- --------
Income (loss) before extraordinary items (7,939) 35,896
Extraordinary items - Gains (losses) on
extinguishment of debt, net of tax - (1)
-------- --------
NET INCOME (LOSS) $ (7,939) $ 35,895
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EARNINGS (LOSS) PER SHARE:
Earnings (loss) before
extraordinary items $ (0.07) $ 0.30
Extraordinary items - -
-------- --------
Net earnings (loss) $ (0.07) $ 0.30
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AVERAGE SHARES OUTSTANDING: 121,479 121,379
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IVAX CORPORATION PRESS RELEASE
MAY 6, 1997
PAGE 4 OF 4
CONDENSED BALANCE SHEETS MARCH 31, DECEMBER 31,
(In thousands) 1997 1996
---------- ----------
ASSETS
Current assets $ 690,427 $ 766,621
Property, plant and equipment, net 423,538 414,711
Other assets 224,468 220,568
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Total assets $1,338,433 $1,401,900
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current portion of long-term debt $ 5,741 $ 5,860
Other current liabilities 211,436 225,488
Long-term debt 411,982 443,424
Other long-term liabilities 17,073 17,432
Minority interest 14,971 14,568
Shareholders' equity 677,230 695,128
---------- ----------
Total liabilities and
shareholders' equity $1,338,433 $1,401,900
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BUSINESS SEGMENT FINANCIAL HIGHLIGHTS
PERIOD ENDED MARCH 31, THREE MONTHS
(In thousands) 1997 1996
---------- ----------
NET REVENUES:
Pharmaceuticals $ 163,672 $ 212,130
Intravenous products 82,593 83,203
Other operations 39,107 39,244
Intersegment eliminations (822) (532)
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Total $ 284,550 $ 334,045
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GROSS PROFIT:
Pharmaceuticals $ 55,172 $ 99,384
Intravenous products 28,968 26,828
Other operations 17,425 18,263
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Total $ 101,565 $ 144,475
========== ==========
INCOME (LOSS) FROM OPERATIONS:
Pharmaceuticals $ (5,701) $ 46,970
Intravenous products 4,627 2,514
Other operations 808 1,277
Corporate expenses and other (9,077) (5,018)
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Total $ (9,343) $ 45,743
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