Transgenomic Reports Second Quarter 20...(per share. Net sales from continuing ...)

Net sales from continuing operations were $12.5 million for the six months ended June 30, 2008, up from $11.5 million during the comparable period of 2007. This increase reflected year-over-year net sales growth of 91% from laboratory services, 49% from the clinical reference laboratory, and 246% from pharmacogenomics research services. Gross profit from continuing operations was $7.4 million, or 59%, for the six months ended June 30, 2008, compared to $6.1 million, or 53%, in the same period during 2007. The improvement in gross margin was largely attributed to the Company's laboratory services product line, which had 43% gross profit during the six months ended June 30, 2008 versus 10% gross profit for the same period in 2007. Product mix and production operating efficiencies on the instrument product lines also contributed to the gross profit improvement.

Operating expenses from continuing operations were $7.2 million for the six months ended June 30, 2008, compared to $8.2 million during the comparable period of 2007, which included $624,000 of restructuring charges. The decrease in operating expenses is largely due to higher research and development collaboration expenses and patent expenses in 2007 as well as a favorable foreign currency translation adjustment of $454,000. These were somewhat offset by increased sales costs.

The company generated $193,000 in cash flows from operations for the six months ended June 30, 2008, compared to $1.6 million in cash flows used in operations during the same period in 2007.

Continued Tuttle, "In addition to achieving our third successive quarter of profitable performance, we are very encouraged by the sound level of growth from our two laboratory businesses. We continue to develop exciting new products while maintaining a very active business development effort for uncovering and licensing high-value tests to add to our menu offering in both laboratory businesses. One example of our
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