UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
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For the quarterly period ended June 30, 2004 |
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or, |
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TRANSITION REPORTS PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
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For the transition period from to |
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Commission File Number: 0-23556 |
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NEKTAR THERAPEUTICS |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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94-3134940 |
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(State or other jurisdiction of |
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(IRS Employer Identification No.) |
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150 Industrial Road |
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(Address of principal executive offices) |
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650-631-3100 |
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(Registrant’s telephone number, including area code) |
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(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 ý No o
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes ý No o
Applicable Only to Corporate Issuers
The number of outstanding shares of the registrant’s Common Stock, $0.0001 par value, was 83,827,390 on July 30, 2004.
NEKTAR THERAPEUTICS
INDEX
Forward-Looking Statements
This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “1933 Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “1934 Act”). All statements other than statements of historical fact are “forward-looking statements” for purposes of this report, including any projections of earnings, revenues or other financial items, any statements of the plans and objectives of management for future operations, any statements concerning proposed new products or services, any statements regarding future economic conditions or performance and any statement of assumptions underlying any of the foregoing. In some cases, forward-looking statements can be identified by the use of terminology such as “may,” “will,” “expects,” “plans,” “anticipates,” “estimates,” “potential,” or “continue,” or the negative thereof or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained in this report are reasonable, there can be no assurance that such expectations or any of the forward-looking statements will prove to be correct and actual results could differ materially from those projected or assumed in the forward-looking statements. Our future financial position and results of operations, as well as any forward-looking statements, are subject to inherent risks and uncertainties, including but not limited to the cautionary factors set forth in this report and for the reasons described elsewhere in this report. All forward-looking statements and reasons why results may differ included in this report are made as of the date hereof and we do not intend to update any forward-looking statements except as required by law or applicable regulations.
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Item 1. Condensed Consolidated Financial Statements – unaudited:
NEKTAR THERAPEUTICS
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share information)
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June 30, 2004 |
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December 31, 2003 |
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(unaudited) |
* |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
36,268 |
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$ |
64,050 |
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Short-term investments |
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389,003 |
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221,917 |
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Accounts receivable |
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18,944 |
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6,153 |
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Inventory, net |
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10,318 |
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8,559 |
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Other current assets |
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6,758 |
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5,819 |
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Total current assets |
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461,291 |
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306,498 |
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Restricted investments |
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— |
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12,442 |
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Property and equipment, net |
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157,615 |
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149,388 |
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Goodwill |
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130,120 |
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130,120 |
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Other intangible assets, net |
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8,709 |
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10,963 |
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Deposits and other assets |
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3,184 |
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7,377 |
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Total assets |
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$ |
760,919 |
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$ |
616,788 |
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities: |
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Accounts payable |
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$ |
5,069 |
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$ |
8,074 |
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Accrued research and development |
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3,265 |
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4,012 |
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Accrued general and administrative |
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2,395 |
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2,282 |
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Accrued compensation |
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9,053 |
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9,705 |
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Other accrued liabilities |
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302 |
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288 |
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Interest payable |
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2,010 |
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2,436 |
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Capital lease obligations - current |
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1,469 |
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1,341 |
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Deferred revenue |
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21,679 |
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18,719 |
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Total current liabilities |
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45,242 |
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46,857 |
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Convertible subordinated notes and debentures |
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173,949 |
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359,988 |
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Capital lease obligations - noncurrent |
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30,472 |
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31,686 |
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Other long-term liabilities |
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11,747 |
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11,956 |
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Accrued rent |
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2,148 |
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2,110 |
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Commitments and contingencies |
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Stockholders’ equity: |
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Preferred Stock, 10,000 shares authorized |
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Series A, $0.0001 par value: 3,100 shares designated; no shares issued or outstanding at June 30, 2004 and December 31, 2003. |
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— |
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— |
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Convertible Series B, $0.0001 par value: 40 shares designated; 20 and 40 shares issued and outstanding at June 30, 2004 and December 31, 2003, respectively Liquidation preference of $19,945 and $40,000 at June 30, 2004 and December 31, 2003, respectively. |
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Common stock, $0.0001 par value; 300,000 authorized; 83,738 shares and 56,197 shares issued and outstanding at June 30, 2004 and December 31, 2003, respectively. |
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8 |
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6 |
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Capital in excess of par value |
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1,179,131 |
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778,500 |
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Deferred compensation |
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(3,362 |
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(38 |
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Accumulated other comprehensive income |
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(1,017 |
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958 |
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Accumulated deficit |
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(677,399 |
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(615,235 |
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Total stockholders’ equity |
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497,361 |
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164,191 |
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Total liabilities and stockholders’ equity |
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$ |
760,919 |
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616,788 |
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(*) The balance sheet at December 31, 2003 has been derived from the audited financial statements at that date, which are included in our Form 10-K, as amended, for the year ended December 31, 2003 as filed with the Securities and Exchange Commission. This balance sheet does not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.
See accompanying notes.
3
NEKTAR THERAPEUTICS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share information)
(unaudited)
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Three-Months Ended June 30, |
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Six-Months Ended June 30, |
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2004 |
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2003 |
2004 |
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2003 |
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Revenue: |
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Contract research revenue |
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$ |
22,102 |
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$ |
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