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ThermoGenesis Reports Fourth Quarter and Fiscal 2009 Results

RANCHO CORDOVA, Calif., Sept. 9 /PRNewswire-FirstCall/ -- ThermoGenesis Corp. (Nasdaq: KOOL), a leading supplier of innovative products for processing and storing adult stem cells, today reported results for the fourth quarter and all of fiscal 2009.

For the quarter ended June 30, 2009, the Company reported revenues of $4.0 million. This compares with revenues of $7.2 million in the fourth quarter a year ago. As the Company indicated previously, revenues in the fourth quarter of fiscal 2009 were impacted by several factors, including delays in customer capital equipment purchases of its BioArchive((R)) System and reduced sales of AXP(TM) AutoXpress(TM) (AXP(TM)) bag sets due to the timing of orders from GE Healthcare. The Company expects these AXP orders will be recovered during the first two quarters of fiscal 2010.

Total disposable revenues were $2.2 million versus $4.2 million in the fourth quarter of fiscal 2008. Disposable revenues in the fourth quarter of fiscal 2009 were impacted by the factors outlined above, offset by revenues from sales of disposables for the Company's MarrowXpress(TM), or MXP(TM), which was launched in mid-fiscal 2009.

The company reported a net loss of $3.1 million, or $0.05 per share, versus a net loss of $2.5 million, or $0.04 per share, in the same period a year ago. As the Company indicated in its press release of August 6, 2009, the loss in the fourth quarter of fiscal 2009 included a number of non-recurring costs. They totaled approximately $1.8 million, including non-cash charges of approximately $0.9 million. Non-recurring charges included $0.8 million in reserves related to the transition to an upgraded AXP device and disposable as well as write-downs of obsolete inventory and tooling at AXP bag set suppliers. Non-recurring charges in the quarter also included $0.2 million related to the release and launch of the Company's Res-Q(TM) 60 BMC ("Res-Q") System, and $0.6 million of excess and aged surgical wound care inventory reserved in connection with the planned divesture of the CryoSeal product line. The Company also recorded $0.2 of severance charges during the quarter.

The company ended fiscal 2009 with $15.6 million in cash and short-term investments, compared with $17.7 million at the end of the third quarter of fiscal 2009 and $25.3 million at the end of fiscal 2008.

"While we have been able to manage our ongoing operating expenses, the non-recurring costs during the quarter reflect the impact of our key strategic initiatives that are focused on both ensuring a high level of quality and expanding the market for our offerings," said J. Melville Engle, Chief Executive Officer.

"We have continued to experience success with our quality initiatives through enhanced internal processes and increased communications with our key suppliers and customers. We also realized significant progress in our initiative to outsource the manufacturing of our devices and expect to complete this transition for our BioArchive and ThermoLine devices by the end of fiscal 2010.

"Our market expansion objectives," he continued, "are being realized with the initial market experience for our devices to process stem cells from bone marrow for orthopedic procedures--the MXP and Res-Q, which was formally launched at the end of July. Both devices have demonstrated solid results in terms of cell recovery and ease of use. Celling Technologies, our distributor for the products, is optimistic about the near-term market expansion opportunities through both adding new centers and entering new geographies. In addition, we will be looking to expand new indications beyond orthopedics for the Res-Q, as well as adding new distributors outside the U.S."

Engle said the Company is seeing positive trends for its cord blood devices as well. "Our larger customers are reporting encouraging collection activity and we recently added New England Cord Blood bank as an AXP customer. Given these favorable trends and the early success of our new products, we are optimistic about our opportunities in fiscal 2010 and our ability to grow revenues and reach profitability during the second half of the fiscal year. We are implementing strategies to achieve a strong performance with our existing products in existing markets and new markets, generate new product flow and capitalize on business development programs through joint ventures and corporate partnerships," he concluded.

For all of fiscal 2009, ThermoGenesis reported revenues of $19.8 million versus revenues of $21.9 million in fiscal 2008. The Company reported a net loss of $8.6 million, or $0.15 per share, compared with a net loss of $9.2 million, or $0.16 per share, in fiscal 2008. The results for fiscal 2009 include a decline of approximately $1.0 million in interest and other income versus fiscal 2008.

Company's Conference Call and Webcast

Management will host a conference call today at 2:00 PM Pacific (5:00 PM Eastern) to review the fiscal fourth quarter financial results.

The call can be accessed by dialing 1-800-860-2442 within the U.S. or 1-412-858-4600 outside the U.S. and referencing, "ThermoGenesis." Mr. J. Melville Engle, Chief Executive Officer and Mr. Matthew Plavan, Executive Vice President, Chief Operating Officer and Chief Financial Officer will host the call to discuss the fourth quarter and year end results and other corporate events, followed by a Q&A session. Participants are asked to call the assigned number approximately 5 minutes before the conference call begins.

To listen to the audio webcast of the call during or after the event, please visit:


A replay of the conference call will be available two hours after the call for the following five business days by dialing 1-877-344-7529 within the U.S. or 1-412-317-0088 outside the U.S. and entering the following account number when prompted '385107'.

                               THERMOGENESIS CORP.
                      Condensed Consolidated Balance Sheets

                                                   June 30,       June 30,
                                                     2009           2008
                                                     ----           ----
    Current assets:
      Cash and cash equivalents                  $6,655,000     $4,384,000
      Short term investments                      8,976,000     20,903,000
      Accounts receivable, net                    4,235,000      5,976,000
      Inventory                                   5,233,000      5,131,000
      Other current assets                          623,000        367,000
                                                    -------        -------

          Total current assets                   25,722,000     36,761,000

    Equipment, net                                1,823,000      1,450,000

    Other assets                                    110,000         71,000
                                                    -------         ------
                                                $27,655,000    $38,282,000
                                                ===========    ===========

    Current liabilities:
    Accounts payable                             $1,781,000     $4,186,000
      Other current liabilities                   3,057,000      2,589,000
                                                  ---------      ---------

          Total current liabilities               4,838,000      6,775,000

    Long-term liabilities                           363,000        982,000

    Stockholders' equity                         22,454,000     30,525,000
                                                 ----------     ----------

                                                $27,655,000    $38,282,000
                                                ===========    ===========

                               THERMOGENESIS CORP.
                 Condensed Consolidated Statements of Operations

                                Three Months Ended          Years Ended
                                     June 30,                  June 30,
                                2009         2008         2009         2008
                                ----         ----         ----         ----
    Net revenues            $4,023,000   $7,182,000  $19,799,000  $21,946,000

    Cost of revenues         3,617,000    4,832,000   14,106,000   14,976,000
                             ---------    ---------   ----------   ----------

      Gross profit             406,000    2,350,000    5,693,000    6,970,000
                               -------    ---------    ---------    ---------

      Selling, general and   2,212,000    2,838,000    9,249,000   10,165,000

      Research and
       development           1,306,000    2,157,000    5,222,000    7,172,000
                             ---------    ---------    ---------    ---------

        Total operating
         expenses            3,518,000    4,995,000   14,471,000   17,337,000

    Interest and other
     income, net                28,000      161,000      228,000    1,186,000
                                ------      -------      -------    ---------

    Net loss               ($3,084,000) ($2,484,000) ($8,550,000) ($9,181,000)
                           ===========  ===========  ===========  ===========

    Basic and diluted net
     loss per common share      ($0.05)      ($0.04)      ($0.15)      ($0.16)
                                ======       ======       ======       ======

    Shares used in computing
     per share data         56,092,960   55,956,452   56,060,460   55,754,578
                            ==========   ==========   ==========   ==========

                               THERMOGENESIS CORP.
                 Condensed Consolidated Statements of Cash Flows

                                                          Years Ended
                                                            June 30,
                                                       2009         2008
                                                       ----         ----
    Cash flows from operating activities:
      Net loss                                    ($8,550,000) ($9,181,000)
      Adjustments to reconcile net loss to
       net cash used in operating activities:
       Depreciation and amortization                  474,000      543,000
       Stock based compensation expense               479,000    1,921,000
       Accretion of discount on short-term
        investments                                  (161,000)    (918,000)
       Loss on sale/retirement of equipment                --      238,000
       Loss on impairment of equipment                149,000           --

       Net change in operating assets and
         Accounts receivable                        1,741,000   (2,750,000)
         Inventories                                 (102,000)    (200,000)
         Prepaid expenses and other current
          assets                                     (256,000)      48,000
         Other assets                                  12,000       51,000
         Accounts payable                          (2,405,000)   2,112,000
         Accrued payroll and related expenses         317,000       39,000
         Deferred revenue                            (562,000)    (633,000)
         Other current liabilities                    107,000      279,000
                                                      -------      -------
       Net cash used in operating activities       (8,757,000)  (8,451,000)
                                                   ----------   ----------

    Cash flows from investing activities:
      Purchase of short-term investments          (25,957,000) (44,336,000)
      Maturities of investments                    38,045,000   52,000,000
      Capital expenditures                         (1,047,000)    (514,000)
                                                   ----------     --------
       Net cash provided by investing
        activities                                 11,041,000    7,150,000
                                                   ----------    ---------

    Cash flows from financing activities:
      Exercise of stock options                            --      266,000
      Repurchase of common stock                           --     (293,000)
      Payments on capital lease obligations
       and note payable                               (13,000)     (18,000)
                                                      -------      -------
       Net cash (used in) provided by
        financing activities                          (13,000)     (45,000)
                                                      -------      -------
    Net increase (decrease) in cash and
     cash equivalents                               2,271,000   (1,346,000)
    Cash and cash equivalents at beginning
     of year                                        4,384,000    5,730,000
                                                    ---------    ---------
    Cash and cash equivalents at end of
     year                                          $6,655,000   $4,384,000
                                                   ==========   ==========

    Supplemental non-cash financing and
     Investing information
      Transfer of equipment to other assets           $51,000           --
                                                      =======          ===
      Transfer of inventories to equipment                 --     $157,000
                                                          ===     ========
      Transfer of equipment to inventories                 --      $42,000
                                                          ===      =======

About ThermoGenesis Corp.

ThermoGenesis Corp. ( is a leader in developing and manufacturing automated blood processing systems and disposable products that enable the manufacture, preservation and delivery of cell and tissue therapy products. These products include:

  • The BioArchive((R)) System, an automated cryogenic device, is used by cord blood stem cell banks in more than 25 countries for cryopreserving and archiving cord blood stem cell units for transplant.
  • AXP((R)) AutoXpress(TM) Platform (AXP), a proprietary family of automated devices that includes the AXP and the MXP((TM)) MarrowXpress and companion sterile blood processing disposables for harvesting stem cells in closed systems. The AXP device is used for the processing of cord blood. GE Healthcare is the exclusive global distribution partner for the AXP cord blood product except for Central and South America, China, Russia/CIS and Japan, where ThermoGenesis markets through independent distributors. The MXP is used for isolating stem cells from bone marrow.
  • The Res-Q((TM)) 60 BMC (Res-Q), a point of care system that is designed for bone marrow stem cell processing. This product was launched in July 2009.
  • The CryoSeal((R) )FS System, an automated device and companion sterile blood processing disposable, is used to prepare fibrin sealants from plasma in about an hour. The CryoSeal FS System is approved in the U.S. for liver resection surgeries. The CryoSeal FS System has received the CE-Mark which allows sales of the product throughout the European community. Asahi Medical is the exclusive distributor for the CryoSeal System in Japan and the Company markets through independent distributors in Europe and South America.

This press release contains forward-looking statements, and such statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual outcomes to differ materially from those contemplated by the forward-looking statements. Several factors, including timing of FDA approvals, changes in customer forecasts, our failure to meet customers' purchase order and quality requirements, supply shortages, production delays, changes in the markets for customers' products, introduction timing and acceptance of our new products scheduled for fiscal years 2009 and 2010, and introduction of competitive products and other factors beyond our control, could result in a materially different revenue outcome and/or in our failure to achieve the revenue levels we expect for fiscal 2009 and fiscal 2010. A more complete description of these and other risks that could cause actual events to differ from the outcomes predicted by our forward-looking statements is set forth under the caption "Risk Factors" in our annual report on Form 10-K and other reports we file with the Securities and Exchange Commission from time to time, and you should consider each of those factors when evaluating the forward-looking statements.

                             ThermoGenesis Corp.
                    Web site:
                         Contact: Investor Relations
                             +1-916-858-5107, or

SOURCE ThermoGenesis Corp.
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