Ligand Pharmaceuticals Incorporated (NASDAQ:LGND) Q4 2018 Earnings Conference Call Transcript
Feb 07, 2019 • 04:30 pm ET
Welcome to the Ligand Fourth Quarter Earnings call. My name is Vincent and I'll be facilitating the audio portion of today's interactive broadcast. All lines have been placed on mute to prevent any background noise. For those of you on the stream please take note of the options available in your event console. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions) Thank you.
I'll now turn the call over to your speaker today, Mr. Todd Pettingill. Sir, you may begin.
Welcome to Ligand's fourth quarter of 2018 financial results and business update conference call. Speaking today for Ligand are John Higgins, CEO; Matt Foehr, COO; and Matt Korenberg, CFO.
As a reminder, today's call will contain forward-looking statements within the meaning of Federal Securities Laws. It may include but are not limited to statements regarding intent, belief or current expectations of the company and its management regarding its internal and partnered programs. These statements involve risks and uncertainties and actual events or results may differ materially from the projections described in today's press release and this conference call. Additional information concerning risk factors and other matters concerning Ligand can be found in Ligand's earnings press release and public periodic filings with the Securities and Exchange Commission, which are available at www.sec.gov.
The information in this conference call related to projections or other forward-looking statements represent the company's best judgment based on information available and reviewed by the company as of today, February 7, 2019 and do not necessarily represent the views of any other party. Ligand undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call.
At this time, I'll turn the call over to John Higgins.
Todd, thank you. Good afternoon and thanks for joining our call. Ligand finished the year strong and had an outstanding 2018. The company is better today financially and in terms of portfolio quality than a year ago and we have a bright outlook as we look forward to the next five to 10 years, and for 2018 -- for the year we posted over a quarter of a billion dollars of revenue at $251 million, that is more than a five-fold increase over 2013, just several years ago.
All three revenue sources Royalties, Captisol, Material sales and contract payments hit all time highs in 2018. I'll add as a bit of corporate history, at an Analyst Day five years ago in late 2013, we published the slide forecasting revenue of over $200 million in 2018. Well, that forecast for 2018 five years ago was accurate, now coming in well past that outlook. The business is highly efficient with gross margins over 97% for 2018 and high EBITDA or cash flow margins of about 80%. Cash flow in 2018 more than doubled over 2017 to nearly $200 million. The lead Royalty products Promacta and Kyprolis are doing very well in the market with each posting record Q4 quarterly sales and