OMAHA, Neb., Nov. 15, 2010 /PRNewswire-FirstCall/ -- Transgenomic, Inc. (OTC Bulletin Board: TBIO) today reported financial results for the three and nine months ended September 30, 2010, and provided a business update. The Company has rescheduled the conference call to discuss third quarter financial results to Monday, November 22, 2010 at 5:00 p.m. Eastern time, whereas previously the call was to be held at 5:00 p.m. Eastern time today.
Nine Month Financial ResultsNet sales were $15.0 million for the nine month period ended September 30, 2010 compared with $15.5 million for the same period of 2009. Gross profit was $7.4 million or 49% of net sales for the 2010 period, compared with gross profit of $8.2 million or 53% of net sales for the 2009 period. Operating expenses for the nine months ended September 30, 2010 were $9.6 million, compared with $10.4 million during the comparable period of 2009. Operating expenses included expense from foreign currency revaluation of $0.3 million in both periods.
The Company reported a net loss for the nine months ended September 30, 2010 of $2.4 million or $0.05 per share, compared with a net loss of $2.0 million or $0.04 per share during the comparable period of 2009.
Net sales were $4.4 million during the third quarter 2010, compared with $5.0 million during the comparable period of 2009. Gross profit was $2.0 million or 46% of net sales during the third quarter of 2010, compared with gross profit of $2.8 million or 55% of net sales during the comparable period of 2009. Operating expenses were $2.8 million during the third quarter of 2010, which included income from foreign currency revaluation of $0.2 million. Operating expenses were $3.2 million during the same period of 2009, which included income from foreign currency revaluation of $0.1 million.
The net loss for the third quarter of 2010 was $898,000 or $0.02 per share, compared with a net loss of $366,000 or $0.01 per share for the third quarter of 2009.
Cash and cash equivalents were $4.6 million as of September 30, 2010, compared with $5.6 million as of December 31, 2009. Subsequent to the end of the quarter the Company was awarded a series of grants in the amount of $1,070,453 from the U.S. government under the Patient Protection and Affordable Care Act.
Comment and OutlookCraig Tuttle, president and chief executive officer of Transgenomic, said, "We made enormous strides in moving our proprietary technologies forward during the third quarter, while at the same time taking measures to align our physical footprint to better match our business operations. However, we did have some disappointments during the quarter, particularly with instrument sales.
"Personalized medicine continues to be the watchword for Transgenomic, and subsequent to the end of the quarter we announced an exciting breakthrough with our COLD-PCR technology. Along with Dana Farber Cancer Institute and a pharmaceutical partner, we completed a development study of several new assays to detect genetic mutations in the Epidermal Growth Factor Receptor (EGFR) gene, bringing us closer to ultra-high sensitivity assays for the detection of low-level DNA mutations in body fluids.
"We also obtained CE-IVD designation and significantly expanded distribution of our SURVEYOR® Scan K-RAS mutation detection kit throughout most of the European Union. This designation now allows us to sell into the commercial market, rather than just for research purposes, and as such opens up a new level of potential customers.
"Our pharmacogenomics services business continued to grow during the quarter, and sales were up 28% versus the third quarter of last year. The pipeline of proposals submitted to pharmaceutical companies stood at $7.0 million as of September 30, compared with $6.0 million as of June 30, and $2 million as of March 31, 2010. Existing signed contracts have approximately $1.7 million of potential net sales remaining. We believe that we are very well positioned to benefit from the growing use of biomarker discovery in the treatment of patients.
"Along with our licensing partner, IntegraGen, we continued to market our new ARISk™ test, which determines if there is an increased risk of autism in a newborn with an autistic older biological sibling. This test gives us the opportunity to derive revenues through both the kit sales and from performing this assay in our CLIA-certified laboratory.
"We continue to rightsize our operational footprint by consolidating our research and development activities in Omaha, Nebraska, reducing headcount and eliminating open positions. Although there will be some one-time costs for these measures, these actions are expected to allow us to be cash flow positive in 2011," Mr. Tuttle concluded.
Conference CallManagement will discuss third quarter 2010 financial results and answer questions during a conference call to be held Monday, November 22, 2010 beginning at 5:00 p.m. Eastern time. To access the call via telephone, please dial 888-563-6275 (domestic) or 706-643-3137 (international) and enter conference ID number 24244484. The call also will be broadcast live over the Internet. To listen to the webcast, please log onto the Company's Investor Relations web page at http://www.transgenomic.com/events.asp?id=6 and follow the instructions. An archived webcast of the call will be available for 30 days. Investors can listen to a replay via telephone until 11:59 p.m. Eastern time on Wednesday, December 22, 2010 by dialing 800-642-1687 (domestic) or 706-645-9291 (international) and entering conference ID number 24244484.
About Transgenomic, Inc. Transgenomic, Inc. (www.transgenomic.com ) is a global biotechnology company specializing in high sensitivity genetic variation and mutation analysis, providing products and services in DNA mutation detection and discovery for clinical research, clinical molecular diagnostics and pharmacogenomics analyses. Its product offerings include the WAVE® Systems and associated consumables specifically designed for use in genetic variation detection and single- and double-strand DNA/RNA analysis and purification. With broad applicability to genetic research, nearly 1,500 systems have been shipped to customers in more than 50 countries. The SURVEYOR® Mutation Detection Kits and SURVEYOR Check-It Kit provide reagents and protocols for high sensitivity detection of mutations in DNA. In addition, HANABI automated chromosome harvesting systems improve laboratory productivity with consistent quality compared with manual methods for cytogenetic analyses. Service offerings include the Transgenomic Molecular Laboratory, which provides reference laboratory services specializing in molecular diagnostics including Mitochondrial Disorders, Oncology and Hematology, Molecular Pathology and Inherited Diseases. Transgenomic Pharmacogenomics Services is a CRO for pharmacogenomic, translational research and clinical trials.
Forward-Looking StatementsCertain statements in this press release constitute "forward-looking statements" of Transgenomic within the meaning of the Private Securities Litigation Reform Act of 1995, which involve known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from any future results, performance or achievements expressed or implied by such statements. Forward-looking statements include, but are not limited to, those with respect to management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results, including the ability of the Company to grow its involvement in the diagnostic products and services markets. The known risks, uncertainties and other factors affecting these forward-looking statements are described from time to time in Transgenomic's filings with the Securities and Exchange Commission. Any change in such factors, risks and uncertainties may cause the actual results, events and performance to differ materially from those referred to in such statements. Accordingly, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 with respect to all statements contained in this press release. All information in this press release is as of the date of the release and Transgenomic does not undertake any duty to update this information, including any forward-looking statements, unless required by law.Transgenomic, Inc. and SubsidiarySummary Financial ResultsUnaudited Condensed Consolidated Statements of Operations(dollars in thousands except per share data)Three Months EndedSeptember 30,Nine Months EndedSeptember 30,2010200920102009NET SALES$ 4,419
$ 15,508COST OF GOODS SOLD2,402
8,217OPERATING EXPENSES:Selling, general and administrative
7,922Research and development
10,390LOSS FROM OPERATIONS(827)
(2,173)OTHER INCOME (EXPENSE):Interest income
10LOSS BEFORE INCOME TAXES (827)
(2,163)INCOME TAX EXPENSE (BENEFIT)71
(114)NET LOSS $
(2,049)BASIC AND DILUTED LOSS PER SHARE$
(0.04)BASIC AND DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING 49,289,672
49,189,672Transgenomic, Inc. and SubsidiarySummary Financial ResultsUnaudited Condensed Consolidated Statements of Cash Flows(dollars in thousands)Nine Months EndedSeptember 30,20102009NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES$ (884)
237NET CASH FLOWS USED IN INVESTING ACTIVITIES(166)
(347)NET CASH FLOWS PROVIDED BY FINANCING ACTIVITIES(15)
—EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH12
—NET CHANGE IN CASH AND CASH EQUIVALENTS(1,053)
(110)CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD5,642
4,771CASH AND CASH EQUIVALENTS AT END OF PERIOD$
4,661Transgenomic, Inc. and SubsidiarySummary Financial ResultsUnaudited Condensed Consolidated Balance Sheets(dollars in thousands)(Unaudited)September 30,2010December 31,2009ASSETSCURRENT ASSETS:Cash and cash equivalents
$ 5,642Accounts receivable (net of allowances for bad debts of $335 and $310, respectively)
4,522Inventories (net of allowance for obsolescence of $520 and $507, respectively)
3,552Prepaid expenses and other current assets
738Total current assets
14,454PROPERTY AND EQUIPMENT, NET1,047
967OTHER ASSETS: Other assets (net of accumulated amortization of $524 and $525, respectively)
$16,004LIABILITIES AND STOCKHOLDERS' EQUITYCURRENT LIABILITIES:Accounts payable
$ 1,013Other accrued expenses
573Total current liabilities
4,103Other long term liabilities
|SOURCE Transgenomic, Inc.|
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