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Caliper Life Sciences Reports Fourth Quarter and Full Year 2007 Results
Date:2/26/2008

- Fourth Quarter Revenue Growth 16% -

- IVIS Imaging Systems Cross 500th Placement Milestone -

HOPKINTON, Mass., Feb. 26 /PRNewswire-FirstCall/ -- Caliper Life Sciences, Inc. (Nasdaq: CALP), a leading provider of tools and services for drug discovery and life sciences research, today reported its fourth quarter and full year financial results for 2007. Fourth quarter revenues were $40.3 million, an increase of 16% from $34.7 million in the same period in 2006. Net loss for the quarter was $5.7 million ($0.12 per share), compared to a net loss of $8.9 million ($0.19 per share) in the same quarter of 2006. Full year 2007 revenues were $140.7 million, up 30% from $107.9 million in 2006. Net loss for the full year was $24.1 million ($0.51 per share), compared to a net loss of $28.9 million ($0.75 per share) in 2006. Caliper attributed its fourth quarter revenue growth to strong performance by its IVIS imaging and its microfluidics products, and attributed its $3.2 million fourth quarter reduction in net loss primarily to product and service gross margin improvements.

Highlights in the quarter include:

-- Product revenue increased 19% in comparison with the fourth quarter of

2006. IVIS molecular imaging systems achieved a new record with 44%

revenue growth and 51 unit placements increasing the installed unit

base to 537 systems. Significantly, the company saw an increase in use

of IVIS systems in new therapeutic areas beyond oncology, including

central nervous system (CNS) disorders, infectious and metabolic

disease, and inflammation. Microfluidics instrument revenue recorded

26% revenue growth led by demand for the new EZ Read 90 - - 90

Benefit (provision)

for income taxes (6) 301 - (386) (85)

Net income (loss) $(8,887) $1,493 $5,011 $(2,383)

Net income (loss) per share

- basic and diluted $(0.19) $(0.05)

Shares used in computing net

loss per share - basic and

diluted 46,652 46,652 See accompanying Notes to Adjusted Consolidated Statements of Operations

CALIPER LIFE SCIENCES, INC.

ADJUSTED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

Year Ended

December 31, 2007

Stock-

based Other Adjusted

Reported Comp Adjustments (1)

Revenues:

Product revenue (4) $82,961 $- $- $82,961

Service revenue 37,557 - - 37,557

License fees and contract

revenue (4) 20,189 - 1,037 21,226

Total revenues 140,707 - 1,037 141,744

Cost and Expenses:

Cost of product revenue (2),(4) 49,760 (422) - 49,338

Cost of service revenue (2) 22,357 (121) - 22,236

Cost of license revenue (4) 2,515 - 138 2,653

Research and development (2),(5) 24,791 (836) - 23,955

Selling, general and

administrative (2) 54,954 (3,783) - 51,171

Amortization of intangible

assets (3) 10,106 - (10,106) -

Restructuring charges (3) 52 - (52) -

Total costs and expenses 164,535 (5,162) (10,020) 149,353

Operating loss (23,828) 5,162 11,057 (7,609)

Interest income, net (547) - - (547)

Other income, net 579 - - 579

Provision for income taxes (6) (284) - - (284)

Net income (loss) $(24,080) $5,162 $11,057 $(7,861)

Net income (loss) per share -

basic and diluted $(0.51) $(0.17)

Shares used in computing net loss

per share - basic and diluted 47,301 47,301

Year Ended

December 31, 2006

Stock-

based Other Adjusted

Reported Comp Adjustments (1)

Revenues:

Product revenue (4) $69,248 $- $273 $69,521

Service revenue 24,454 - - 24,454

License fees and contract

revenue (4) 14,169 - 1,603 15,772

Total revenues 107,871 - 1,876 109,747

Cost and Expenses:

Cost of product revenue (2),(4) 45,459 (506) 9 44,962

Cost of service revenue (2) 14,917 (151) - 14,766

Cost of license revenue (4) 219 - 149 368

Research and development (2),(5) 24,591 (975) (2,898) 20,718

Selling, general and

administrative (2) 43,570 (3,938) - 39,632

Amortization of intangible

assets (3) 8,842 - (8,842) -

Restructuring charges (3) 258 - (258) -

Total costs and expenses 137,856 (5,570) (11,840) 120,446

Operating loss (29,985) 5,570 13,716 (10,699)

Interest income, net 478 - - 478

Other income, net 469 - - 469

Provision for income taxes (6) 104 - (386) (282)

Net income (loss) $(28,934) $5,570 $13,330 $(10,034)

Net income (loss) per share -

basic and diluted $(0.75) $(0.26)

Shares used in computing net

loss per share - basic and

diluted 38,743 38,743

Notes to Adjusted Consolidated Statements of Operations

(1) To supplement the financial results presented on a GAAP basis, the

Company uses adjusted measures of gross profit margins, costs and

expenses, net loss and net loss per share which are non-GAAP

financial measures. Caliper's management uses these adjusted

financial measures to gain an understanding of its comparative

operating performance, and also in financial and operating decision-

making because management believes they better reflect the underlying

economics of Caliper's ongoing business. Management believes that

comparisons of adjusted financial measures may be more meaningful

because operating results presented under GAAP may include, from time

to time, items that management believes are not necessarily relevant

to understand Caliper's business. Caliper's management believes that

these adjusted financial measures provide useful information to

investors and others in understanding and evaluating Caliper's

current operating performance and future prospects. The adjusted

financial measures have limitations, however, because they do not

include all items of income and expense that impact Caliper's

operations. The adjusted measures exclude:

(a) Expense associated with the amortization of acquisition-related

intangible assets, impairment of acquired intangible assets and in-

process research and development. This exclusion allows comparisons

of operating results that are consistent over time for both the

Company's newly acquired and long-held business activities and with

both acquisitive and non-acquisitive peers.

(b) Deferred revenue adjustments recorded in purchase accounting that

reduce revenues that would otherwise be recognized on a continuing

GAAP basis.

(c) Restructuring expense related reductions in force and costs to

discontinue activities including idle capacity costs. The costs

largely relate to restructuring activities associated with business

combinations and are not indicative of the Company's normal operating

costs.

(d) The Company adopted Statement of Financial Accounting Standards

(SFAS) No. 123R on January 1, 2006, which requires non-cash stock

compensation expense to be recorded when stock options and other

stock-related awards vest. The Company is using the Modified-

Prospective Transition method in its adoption of SFAS No. 123R and,

as such, is not required to restate prior year results for the impact

of stock-related awards expensing. The Company believes that

available valuation methodologies and assumptions may result in

estimates that are misleading in the comparison of its financial

results to previous periods or to its peers, and do not provide

meaningful insight into the Company's ongoing operations.

(2) Adjustment represents stock-based compensation expense.

(3) Adjustment represents intangible asset amortization and impairment

charges and restructuring activities related to business

combinations.

(4) Adjustment represents revenues and related costs that were recorded

at fair value in accordance with the provisions of SFAS No. 141 and

EITF No. 01-03. As a result, these amounts were excluded from the

reported results on a GAAP basis, however, due to the fact they

relate to purchase accounting, they have been added back on an

Adjusted basis.

(5) Adjustment represents in-process research and development charge

related to the Xenogen acquisition.

(6) Adjustment represents tax effect of intangible asset impairment

charges.

er products which

are used primarily in kinase screening. Automation instrument revenue

for the quarter was level with the fourth quarter of 2006.

-- Service revenue grew 18% in comparison with the fourth quarter of 2006.

Caliper Discovery and Alliances Services ("CDAS") posted strong 29%

growth reflecting the new EPA ToxCast contract awarded in the second

quarter of 2007, plus expanded in vivo phenotyping business with

pharmaceutical companies. Instrument maintenance and other services

posted high single digit growth.

-- Combined product and service gross margins improved to 42% versus the

fourth quarter of 2006. The gain of over 270 basis points in gross

margins compared to the fourth quarter of 2006 reflected increased

volumes, as well as savings from raw materials sourcing initiatives.

-- Operating expenses (R&D plus SG&A) increased by $1.2 million from the

fourth quarter of 2006. This was primarily due to costs associated with

ongoing litigation.

-- Positive operating cashflow was generated in the quarter, and Caliper

ended the period with $19.0 million in cash and marketable securities.

"In the fourth quarter of 2007, we achieved strong revenue performance in all of our key growth drivers: the IVIS Spectrum imaging instrument, the microfluidics-based EZ Reader instrument and the associated ProfilerPro product line of reagents, the Zephyr desktop liquid handler, and CDAS in vitro and in vivo services. This evidence of market support reinforces our belief that our products and services are well positioned for double digit revenue growth in 2008," said Kevin Hrusovsky, president and CEO of Caliper. "Our bottom line reflects a continuing trend of improvement, particularly in product gross margins which gained over 500 basis points in 2007 compared with 2006. There is room to do more. We have 2008 initiatives in place to better manage manufacturing materials and inventory, as well as improve the efficiency of our operating expense spending."

2008 GAAP Guidance

Caliper reported that its revenue outlook for the first quarter of 2008 is $26.5 to $29.5 million and its revenue outlook for the full year 2008 is $142 to $148 million. Caliper's revenue outlook encompasses combined product and service revenue for the first quarter of 2008 of $24 to $27 million and for the full year 2008 of $132 to $138 million, representing 5.4% and 12% product and service revenue growth at the midpoint of the respective ranges.

Adjusted Results

Caliper supplements its GAAP financial reporting with certain non-GAAP financial measures. A reconciliation of Caliper's GAAP to non-GAAP Statements of Operations is provided at the end of this release under "Adjusted Consolidated Statements of Operations." Adjusted results of operations exclude stock-based compensation charges and acquisition-related revenue adjustments and expenses, such as amortization of intangibles and restructuring charges and credits. Caliper believes that providing this additional information enhances investors' understanding of the financial performance of Caliper's operations and increases the comparability of its current financial statements to prior periods.

In the fourth quarter of 2007, Caliper reported adjusted revenue of $40.3 million, an increase of 13% over the fourth quarter of 2006, and an adjusted net loss of $2.0 million ($0.04 per share), in comparison with an adjusted net loss of $2.4 million ($0.05 per share) in the fourth quarter of 2006. For the full year 2007, Caliper reported adjusted revenue of $141.7 million, an increase of 29% over 2006, and an adjusted net loss of $7.9 million or ($0.17) per share in comparison with an adjusted net loss of $10.0 million or ($0.26) per share in 2006.

Caliper will discuss its fourth quarter and full year results in a conference call to be held today, February 26 at 9:00 a.m. EST. To participate in the call, please dial 888-713-4215 five to ten minutes prior to the call and use the participant passcode 54563865. International callers can access the call by dialing 617-213-4867 and entering the same passcode. You may also pre-register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PKKMX3XKF.

A live webcast of the call can be accessed at http://www.fulldisclosure.com or on the Caliper website at http://www.caliperLS.com in the Events section of the Investor Relations page. A webcast replay of the call will remain available until Caliper's earnings call for the first quarter of 2008.

Telephone replays of the conference call will be available approximately two hours after the completion of the call on February 26 until March 4, 2008. To access a telephone playback of the proceedings, dial 888-286-8010 and use the participant passcode 19800700. International callers can access the playback by dialing 617-801-6888 and using the same participant passcode.

About Caliper Life Sciences

Caliper Life Sciences is a premier provider of cutting-edge technologies enabling researchers in the life sciences industry to create life-saving and enhancing medicines and diagnostic tests more quickly and efficiently. Caliper is aggressively innovating new technology to bridge the gap between in vitro assays and in vivo results and then translating those results into cures for human disease. Caliper's portfolio of offerings includes state-of-the-art microfluidics, lab automation & liquid handling, optical imaging technologies, and discovery & development outsourcing solutions. For more information please visit http://www.caliperLS.com.

The statements in this press release regarding future events, including statements regarding Caliper's expected financial results for the first quarter ending March 31, 2008 and for fiscal year 2008, Caliper's beliefs regarding the future growth rate performance of its IVIS imaging products, the strong revenue growth potential of Caliper's microfluidics products, and the effect of the EPA ToxCast contract on future revenues and margins, are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements as a result of a number of factors, including the risks that unexpected difficulties may be encountered in gaining wider commercial adoption of Caliper's new products, that the EPA may not expand the screening of compounds under the ToxCast contract as much or as rapidly as expected by Caliper, and that Caliper's expectations regarding demand for its products and services may not materialize if capital spending by Caliper's customers declines, if competitors introduce new competitive products, or if Caliper is unable to convince potential customers regarding the superior performance of its drug discovery and imaging systems and other products. Further information on risks faced by Caliper are detailed under the caption "Risks Related To Our Business" in Caliper's Annual Report on Form 10-K for the year ended December 31, 2006. Our filings are available on a web site maintained by the Securities and Exchange Commission at http://www.sec.gov. Caliper does not undertake any obligation to update forward-looking or other statements in this release or the conference call.

NOTE: Caliper, Xenogen, IVIS and LabChip are registered trademarks, and Spectrum, Zephyr, EZ Reader and ProfilerPro are trademarks, of Caliper Life Sciences, Inc. or its subsidiaries.

CALIPER LIFE SCIENCES, INC.

SELECTED FINANCIAL INFORMATION

(unaudited)

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

Three Months Ended Year Ended

December 31, December 31,

2007 2006 2007 2006

Revenue:

Product revenue $28,175 $23,739 $82,961 $69,248

Service revenue 9,513 8,088 37,557 24,454

License fees and contract revenue 2,568 2,893 20,189 14,169

Total revenue 40,256 34,720 140,707 107,871

Costs and expenses:

Cost of product revenue 15,961 14,029 49,760 45,459

Cost of service revenue 5,756 5,184 22,357 14,917

Cost of license revenue 277 146 2,515 219

Research and development 5,702 6,542 24,791 24,591

Selling, general and administrative 15,642 13,630 54,954 43,570

Amortization of intangible assets 2,514 4,314 10,106 8,842

Restructuring charges, net 22 161 52 258

Total costs and expenses 45,874 44,006 164,535 137,856

Operating loss (5,618) (9,286) (23,828) (29,985)

Interest income (expense), net (226) 8 (547) 478

Other income (expense), net 213 90 579 469

Benefit (provision) for income taxes (103) 301 (284) 104

Net loss $(5,734) $(8,887) $(24,080) $(28,934)

Net loss per share,

basic and diluted $(0.12) $(0.19) $(0.51) $(0.75)

Shares used in computing net

loss per common share,

basic and diluted 47,561 46,652 47,301 38,743

CALIPER LIFE SCIENCES, INC.

SELECTED FINANCIAL INFORMATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

December 31,

2007 2006

(unaudited) (Note 1)

Assets

Current assets:

Cash and cash equivalents $15,709 $11,634

Marketable securities 3,246 13,303

Accounts receivable, net 30,248 30,822

Inventories 19,572 18,758

Other current assets 2,353 2,273

Total current assets 71,128 76,790

Property and equipment, net 11,477 13,182

Intangible assets, net 42,862 52,806

Goodwill 80,836 80,776

Other assets 1,626 1,499

Total assets $207,929 $225,053

Liabilities and stockholders' equity

Current liabilities $45,391 $49,938

Loans payable and other long-term obligations 21,352 17,706

Stockholders' equity 141,186 157,409

Total liabilities and stockholders' equity $207,929 $225,053

Note (1): Derived from audited financial statements for the year ended

December 31, 2006.

CALIPER LIFE SCIENCES, INC.

ADJUSTED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

Three Months Ended

December 31, 2007

Stock-based Other

Reported Comp Adjustments Adjusted(1)

Revenues:

Product revenue (4) $28,175 $- $- $28,175

Service revenue 9,513 - - 9,513

License fees and

contract revenue (4) 2,568 - 20 2,588

Total revenues 40,256 - 20 40,276

Cost and Expenses:

Cost of product

revenue (2),(4) 15,961 (93) - 15,868

Cost of service

revenue (2) 5,756 (22) - 5,734

Cost of license

revenue (4) 277 - - 277

Research and

development (2) 5,702 (212) - 5,490

Selling, general and

administrative (2) 15,642 (865) - 14,777

Amortization of

intangible assets (3) 2,514 - (2,514) -

Restructuring charges (3) 22 - (22) -

Total costs and expenses 45,874 (1,192) (2,536) 42,146

Operating loss (5,618) 1,192 2,556 (1,870)

Interest income (expense),

net (226) - - (226)

Other income, net 213 - - 213

Benefit (provision)

for income taxes (6) (103) - - (103)

Net income (loss) $(5,734) $1,192 $2,556 $(1,986)

Net income (loss) per share

- basic and diluted $(0.12) $(0.04)

Shares used in computing net

loss per share - basic and

diluted 47,561 47,561

Three Months Ended

December 31, 2006

Stock-based Other

Reported Comp Adjustments Adjusted(1)

Revenues:

Product revenue (4) $23,739 $- $- $23,739

Service revenue 8,088 - - 8,088

License fees and

contract revenue (4) 2,893 - 1,017 3,910

Total revenues 34,720 - 1,017 35,737

Cost and Expenses:

Cost of product

revenue (2),(4) 14,029 (133) - 13,896

Cost of service

revenue (2) 5,184 (40) - 5,144

Cost of license revenue (4) 146 - 95 241

Research and

development (2) 6,542 (252) - 6,290

Selling, general and

administrative (2) 13,630 (1,068) - 12,562

Amortization of

intangible assets (3) 4,314 - (4,314) -

Restructuring charges (3) 161 - (161) -

Total costs and

expenses 44,006 (1,493) (4,380) 38,133

Operating loss 9,286 1,493 5,397 (2,396)

Interest income

(expense), net 8 - - 8

Other income, net
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SOURCE Caliper Life Sciences, Inc.
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