Published: March 10, 2011
Transgenomic Reports Fourth Quarter Financial Results
OMAHA, Neb., March 10, 2011 /PRNewswire/ -- Transgenomic, Inc. (OTC Bulletin Board: TBIO) today reported financial results for the three and 12 months ended December 31, 2010, and provided a business update.
The Company reported a net loss for 2010 of $3.1 million or $0.06 per share, compared with a net loss for 2009 of $1.9 million or $0.04 per share. Net sales for 2010 were $20.0 million, compared with $22.0 million for 2009. Gross profit was $9.8 million or 49 percent of net sales for 2010, compared with gross profit of $11.6 million or 53 percent of net sales for 2009. Operating expenses were $13.4 million for 2010, which included acquisition related expense of $0.8 million, or $12.6 million, excluding the acquisition expenses. Operating expenses for 2009 were $13.5 million. Other income in the year ended December 31, 2010 includes an award of a federal grant under the Qualifying Therapeutic Discovery Project of $0.6 million, net of consulting fees.
Net loss for the fourth quarter of 2010 was $767,000 or $0.02 per diluted share, compared with a net income of $129,000 or $0.00 per share for the fourth quarter of 2009. Net sales were $5.1 million during the fourth quarter 2010, compared with $6.5 million during the comparable period of 2009. The fourth quarter of 2009 included an exceptionally large order of WAVE instruments. Gross profit was $2.4 million or 47 percent of net sales during the fourth quarter of 2010, compared with gross profit of $3.4 million or 52 percent of net sales during the comparable period of 2009. Operating expenses were $3.7 million during the fourth quarter of 2010, including $0.8 million of costs related to the FAMILION acquisition, or $2.9 million, excluding the acquisition expenses, compared with $3.1 million during the same period of 2009.
Cash and cash equivalents were $3.5 million as of December 31, 2010, compared with $5.6 million as of December 31, 2009. Cash flow used in operations was $1.7 million for 2010, compared with cash flow provided by operations of $1.3 million for 2009.
Comment and Outlook
Craig Tuttle, president and chief executive officer, commented, "We have substantially increased our footprint in the molecular diagnostics laboratory market through our recent acquisition of the Clinical Data FAMILION product line, which includes a CLIA laboratory facility and business. This acquisition brings us approximately $13.0 million in new annual revenues and a much larger presence both with insurers and patients. This acquisition also provides us access to higher throughput technologies and an expert staff to aid us in growing our reference laboratory business."
"We continue to leverage our core instrument business for on-going instrument sales worldwide as well as employ our instruments and related expertise in our two laboratory services businesses. We anticipate growth in both of our laboratory services businesses and we continue to seek out new assay technologies and tests to license or develop internally to expand our menu offerings for both of these service businesses."
Conference Call
Company management will discuss fourth quarter and full year 2010 financial results and answer questions during a conference call tomorrow beginning at 11:00 a.m. Eastern time. To access the call via telephone, please dial 800-895-1715 or 785-424-1059. 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 recording of the call can be accessed using the same link listed above for 14 days after the call. Investors can also listen to a replay via telephone until 11:59 p.m. Eastern time on Wednesday, March 25, 2011 by dialing 800-723-0528 or 402-220-2654.
About Transgenomic, Inc.
Transgenomic, Inc. (www.transgenomic.com ) develops and markets molecular diagnostic technologies, tests, and services for oncology, cardiology, hematology, inherited disorders, and diseases of aging. The Company is advancing the analysis of DNA and RNA at the molecular level, making it possible to detect disease more accurately at earlier stages, bringing improvements in the quality of patient care and lowering the costs of disease management. Service offerings include the Transgenomic Molecular Laboratory, which provides reference laboratory services specializing in molecular diagnostics. Transgenomic Pharmacogenomics Services is a CRO for pharmacogenomic, translational research and clinical trials.
In December of 2010, we acquired a second CLIA certified laboratory in New Haven, Connecticut which specializes in genetic disorders associated with cardiomyopathies and channelopathies. We believe there is a significant opportunity for us to continue serving the growing demand for molecular-based testing by leveraging our technologies, experience and expertise in biomarker analysis. In addition, we continue to seek and evaluate new technologies and new laboratory tests which will further extend our offerings in our Molecular Diagnostics Laboratory and our Pharmacogenomics Services Lab.
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 provide reagents and protocols for high sensitivity detection of mutations in DNA. HANABI automated chromosome harvesting systems improve laboratory productivity with consistent quality compared with manual methods for cytogenetic karyotyping and FISH analyses.
Forward-Looking Statements
Certain 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.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Operations
(dollars in thousands except per share data)
Three
Months
Ended
December
31,
2010 2009
---- ----
NET SALES $5,092 $6,515
COST OF GOODS SOLD 2,716 3,127
----- -----
Gross profit 2,376 3,388
OPERATING EXPENSES:
Selling, general and
administrative 3,309 2,397
Research and development 354 714
Restructuring charges 66 -
---
3,729 3,111
----- -----
INCOME (LOSS) FROM OPERATIONS (1,353) 277
OTHER INCOME:
Interest income (expense) (6) 1
Other, net 632 7
--- ---
626 8
--- ---
INCOME (LOSS) BEFORE INCOME
TAXES (727) 285
INCOME TAX EXPENSE 40 156
--- ---
NET INCOME (LOSS) $(767) $129
===== ====
BASIC AND DILUTED INCOME
(LOSS) PER SHARE:
From continuing operations $(0.02) $0.00
BASIC WEIGHTED AVERAGE SHARES
OUTSTANDING 49,289,672 49,189,672
DILUTED WEIGHTED AVERAGE
SHARES OUTSTANDING 49,289,672 49,217,942
Year Ended
December
31,
2010 2009
--- ----
NET SALES $20,048 $22,023
COST OF GOODS SOLD 10,284 10,418
------ ------
Gross profit 9,764 11,605
OPERATING EXPENSES:
Selling, general and
administrative 10,933 10,319
Research and development 2,305 3,182
Restructuring charges 138 -
---
13,376 13,501
------ ------
INCOME (LOSS) FROM OPERATIONS (3,612) (1,896)
OTHER INCOME:
Interest income (expense) (4) 15
Other, net 632 3
--- ---
628 18
--- ---
INCOME (LOSS) BEFORE INCOME
TAXES (2,984) (1,878)
INCOME TAX EXPENSE 150 42
--- ---
NET INCOME (LOSS) $(3,134) $(1,920)
======= =======
BASIC AND DILUTED INCOME
(LOSS) PER SHARE:
From continuing operations $(0.06) $(0.04)
BASIC WEIGHTED AVERAGE SHARES
OUTSTANDING 49,243,839 49,189,672
DILUTED WEIGHTED AVERAGE
SHARES OUTSTANDING 49,243,839 49,189,672
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
Year Ended
December
31,
2010 2009
---- ----
NET CASH FLOWS PROVIDED BY
(USED IN) OPERATING ACTIVITIES $(1,718) $1,267
NET CASH FLOWS USED IN
INVESTING ACTIVITIES (6,226) (377)
NET CASH FLOWS PROVIDED BY
FINANCING ACTIVITIES 5,761 -
EFFECT OF FOREIGN CURRENCY
EXCHANGE RATE CHANGES ON CASH (5) (19)
--- ---
NET CHANGE IN CASH AND CASH
EQUIVALENTS (2,188) 871
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 5,642 4,771
----- -----
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $3,454 $5,642
====== ======
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Balance Sheets
(dollars in thousands)
December December
31, 31,
2010 2009
--- ---
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $3,454 $5,642
Accounts receivable (net of
allowances for bad debts 7,601 4,522
of $334 and $310,
respectively)
Inventories (net of
allowance for obsolescence
of $518 3,344 3,552
and $507, respectively)
Other current assets 635 738
--- ---
Total current assets 15,034 14,454
PROPERTY AND EQUIPMENT, NET 1,602 967
OTHER ASSETS:
Goodwill 6,275 -
Intangibles (net of
accumulated amortization
of $519 8,962 383
and $525, respectively)
Other assets 154 200
--- ---
$32,027 $16,004
======= =======
LIABILITIES AND
STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $1,360 $1,013
Accrued compensation 875 573
Short term debt 989 -
Accrued expenses 3,231 2,517
Contractual obligation 1,628 -
Current portion of lease
obligations 170 -
--- ---
Total current liabilities 8,253 4,103
Long term debt less current
maturities 8,640 -
Series A convertible
preferred stock, $0.1 par
value, 1,457 -
3,879,307 shares
authorized, 2,586,205
shares
issued and outstanding
Beneficial conversion
feature 1,983 -
Warrant liability 2,351 -
Other long term liabilities 843 239
--- ---
Total liabilities 23,527 4,342
STOCKHOLDERS' EQUITY 8,500 11,662
----- ------
$32,027 $16,004
======= =======
SOURCE Transgenomic, Inc.
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