Ligand Holds Investor and Analyst Day; Provides Update on Portfolio Progress and Recent Transactions; Introduces 2024 Guidance - Seite 2

Recent Transactions: Management discussed the recent soticlestat and TZIELD (teplizumab) royalty acquisitions, which closed in Q4 2023.

Captisol Technology Platform: Management shared that Captisol continues to enable product approvals for Ligand partners, with five possible approvals anticipated in 2024.

2024 Investment Outlook: Management highlighted that Ligand’s Q4 2023 pipeline has over 20 actionable opportunities representing more than $1 billion in potential investments. The company believes it is well positioned and resourced to close multiple new investments in 2024, depending on the size and quality of the opportunities.

The company introduced 2024 financial guidance, as follows:

• Total revenue of $130 million to $142 million, comprised of $90 million to $95 million from royalties, $25 million to $27 million from sales of Captisol and $15 million to $20 million from contract revenue.
• Adjusted diluted EPS of $4.25 to $4.75.

The company provided an illustrative 5-year outlook, as follows:

• Ligand’s existing commercial programs, pipeline of mid- to late-stage programs and portfolio of over 75 additional partnerships (the “Pharm Team”) are expected to drive five-year growth in royalties at a compounded annual growth rate (CAGR) of 16%.
• Layering on the first wave of potential future investments, the five-year CAGR for royalties could increase to above 20%.
• Total core revenue could reach approximately $290 million by 2028.
• EBITDA margin could exceed 80% by 2028.
• Adjusted diluted EPS outlook for 2028 is in the range of $10.00 to $10.50.

Adjusted Financial Measures

Ligand reports adjusted net income and adjusted net income per diluted share in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. The Company’s financial measures under GAAP include share-based compensation expense, amortization of debt-related costs, amortization related to acquisitions and intangible assets, changes in contingent liabilities, mark-to-market adjustments for amounts relating to its equity investments in public companies, excess tax benefit from share-based compensation, income tax effect of adjusted reconciling items and others that are listed in the itemized reconciliations between GAAP, and adjusted financial measures included in its prior earnings releases. However, the Company does not provide reconciliations of such forward-looking adjusted measures to GAAP, including measures reported in this press release, due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation, including adjustments that could be made for changes in contingent liabilities, changes in the market value of its investments in public companies, share-based compensation expense, and the effects of any discrete income tax items. Management has excluded the effects of these items in its adjusted measures to assist investors in analyzing and assessing the Company’s past and future core operating performance. Additionally, adjusted earnings per diluted share is a key component of the financial metrics utilized by the Company’s board of directors to measure, in part, management’s performance and determine significant elements of management’s compensation.