King Pharmaceuticals repays $48 million of debt in first quarter

By Jennifer Lanning Drey

Portland, Ore., May 11 - King Pharmaceuticals, Inc. repaid $48 million of debt in the first quarter, reducing the face value of its outstanding debt to $977 million at March 31, Joseph Squicciarino, chief financial officer of King, said Monday during the company's quarterly earnings conference call.

The repayment related to long-term debt taken on as part of King's acquisition of Alpharma Inc. and was $33 million more than required under its repayment schedule.

King projects it will generate between $375 million and $400 million of cash from operations for the full year, which will allow it to continue to aggressively pay down long-term debt, advance its pipeline and explore business development opportunities, he said.

During the first quarter, the company generated $17 million of cash from continuing operations. Cash and cash equivalents totaled $437 million at March 31.

King continued to advance its pipeline during the quarter, focusing on gaining regulatory approval for four products currently under review by the Food and Drug Administration, Brian Markison, chief executive officer of King, said during the call.

Also during the period, King substantially completed integration initiatives related to the Alpharma acquisition and worked to identify and capture synergies, Squicciarino said.

The company spent $385 million to redeem the convertible senior notes of Alpharma in connection with the closing of the acquisition in January.

King posted first-quarter revenues of $429 million, down from revenues $432 million for the first quarter of 2008. The net loss for the first quarter was $11 million, compared with net earnings of $86 million in the prior-year period.

Alpharma is a Bridgewater, N.J.-based specialty pharmaceutical and animal health company.

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