EXHIBIT 99.1
ACACIA RESEARCH REPORTS SECOND QUARTER FINANCIAL RESULTS
NEWPORT BEACH, Calif.--(BUSINESS WIRE)--Aug. 13, 2002--Acacia Research
Corporation (Nasdaq:ACRI - News) today reported second quarter financial
results.
Revenues for the second quarter of 2002 were $438,000 versus $10,091,000 in the
comparable 2001 period. Second quarter 2002 revenues, all of which related to
our majority-owned subsidiary, CombiMatrix Corporation, were comprised of
revenues recognized under its grants from the U.S. Department of Defense and the
National Institutes of Health and product sales to a Japanese government
institution.
The second quarter 2002 net loss from continuing operations was $9,701,000 or 49
cents per share versus a net loss from continuing operations of $4,772,000 or 25
cents per share in the comparable 2001 period.
Excluding non-cash compensation charges, the second quarter 2002 net loss was
$8,457,000 versus $627,000 in the comparable 2001 period. Non-cash compensation
charges after minority interests were $1,244,000 and $4,145,000 for the second
quarter of 2002 and 2001, respectively and relate primarily to a step-up in
value of our CombiMatrix subsidiary in connection with its proposed initial
public offering in 2000.
Results for the second quarter of 2002 were impacted by CombiMatrix's
accelerated development activities under the product commercialization phase of
its July 2001 license, supply, research and development agreements with Roche
Applied Science, resulting in an increase in research and development spending
which totaled $5.0 million in the second quarter of 2002 versus $2.7 million in
the comparable 2001 period.
(Note: All share and per-share information has been adjusted retroactively to
reflect the 10% stock dividend declared by Acacia Research on October 22, 2001
and distributed on December 5, 2001.)
Financial Condition
Total assets were $93.0 million as of June 30, 2002 as compared to $110.9
million as of December 31, 2001.
Cash and short-term investments on a consolidated basis were $66.4 million as of
June 30, 2002 as compared to $84.6 million as of December 31, 2001.
Business Highlights
Business highlights of the second quarter include:
- -- In April 2002, CombiMatrix's Japanese subsidiary entered into a technology
access and purchase agreement in Japan with the Computational Biology Research
Center, a division of the Japanese National Institute of Advanced Industrial
Science and Technology. The CBRC has purchased and installed a CombiMatrix gene
chip synthesizer and entered into a multi-year agreement to purchase blank chips
that will be used to synthesize custom gene chips. The agreement also gives CBRC
access to the CombiMatrix set of informatics tools to help in their efforts to
expand biotechnology related businesses in Japan.
- -- In April 2002, Acacia Research sold its interest in Advanced Material
Sciences, Inc., a development stage company that holds the exclusive license for
CombiMatrix's biological array processor technology in certain fields of
material science, to its subsidiary CombiMatrix. CombiMatrix issued 180,982
shares of its common stock in exchange for Acacia Research's 58% interest in
Advanced Material Sciences, Inc. CombiMatrix currently owns 87% of Advanced
Material Sciences and the remaining interests are owned by unaffiliated
entities.
- -- In May 2002, CombiMatrix's Japanese subsidiary entered into a technology
access collaboration and purchasing agreement with the Genome Science Laboratory
at the Research Center for Advanced Science and Technology (RCAST) of the
University of Tokyo. Under the terms of the agreement, the RCAST has installed a
CombiMatrix gene chip synthesizer and entered into a multi-year agreement to
purchase blank chips that will be used in the development of diagnostic
microarray applications, drug lead development and target gene identification
for the drug discovery industry. The agreement includes a memorandum of
understanding that in the event of the discovery or development of novel and
valuable content, candidates or products, the parties will establish an
agreement for the commercialization of those discoveries. Such an agreement
enables both CombiMatrix and RCAST to benefit from the discoveries made using
this platform.
Subsequent business highlights:
- -- In July 2002 CombiMatrix completed a milestone in its strategic alliance with
Roche Applied Science. CombiMatrix's strategic alliance with Roche includes a
collaboration for the development and commercialization of CombiMatrix's DNA
microarray technology, enabling flexible and fast custom manufacturing of
microarrays by electrochemical oligonucleotide synthesis in-situ.
- -- In July 2002, Acacia executed a license agreement with Loewe Opta GmbH,
whereby Acacia will receive payment and grant a non-exclusive license of its
patented V-chip technology to Loewe Opta GmbH, a manufacturer of televisions
sold under the Loewe brand name.
- -- In July 2002, Acacia was granted a patent for its digital media transmission
technology in Japan. The patent provides coverage through January 2, 2012. The
granting of the Japanese patent strengthens Acacia's worldwide intellectual
property position, which includes five patents in the United States and issued
patents in 17 foreign countries.
- -- In July 2002, CombiMatrix completed a prototype electrochemical detection
system and delivered the system to the U.S. Department of Defense. CombiMatrix
developed its sensor technology through grants from the U.S. Department of
Defense. The focus of the grants was aimed at developing an ultrasensitive
hand-held biochip system for detecting the deployment of chemical and biological
warfare agents.
A conference call is scheduled for 1:30 p.m. Pacific Time (4:30 p.m. Eastern) on
Wednesday, August 14, 2002. The conference call will include a review of
financial results for the first quarter and a discussion of business
developments. Shareholders, analysts and reporters are welcome to participate.
Paul R. Ryan, Chairman and CEO of Acacia Research, Robert "Chip" Harris,
President of Acacia Research, and Dr. Amit Kumar, CEO of CombiMatrix
Corporation, will host the call.
To listen to the presentation by phone, dial 800-360-9865 for domestic callers
and 973-694-6836 for international callers. A replay of the audio presentation
will be available for 30 days at 800-428-6051 for domestic callers and
973-709-2089 for international callers, both of whom will need to enter the code
257113 when prompted.
The call is being webcast by CCBN and can be accessed at Acacia Research's Web
site at www.acaciaresearch.com. Individual investors can listen to the call
through CCBN's individual investor center at www.companyboardroom.com.
About Acacia Research Corporation
Acacia Research develops licenses and provides products for the life science and
media technology sectors. Acacia licenses its V-chip technology to television
manufacturers and owns pioneering technology for digital streaming and
video-on-demand. Acacia's CombiMatrix subsidiary is developing a biochip
technology for the life science market. Acacia Research's Web site is located at
www.acaciaresearch.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
1995:
This news release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These statements are based upon our current expectations and speak only as
of the date hereof. Our actual results may differ materially and adversely from
those expressed in any forward-looking statements as a result of various factors
and uncertainties, including the recent economic slowdown affecting technology
companies, our ability to successfully develop products, rapid technological
change in our markets, changes in demand for our future products, legislative,
regulatory and competitive developments and general economic conditions. Our
Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form
10-Q, recent Current Reports on Forms 8-K and 8-K/A, and other SEC filings
discuss some of the important risk factors that may affect our business, results
of operations and financial condition. We undertake no obligation to revise or
update publicly any forward-looking statements for any reason.
ACACIA RESEARCH CORPORATION (ACRI)
SUMMARY FINANCIAL INFORMATION
(unaudited)
CONSOLIDATED BALANCE SHEET INFORMATION
(in thousands)
June 30, December 31,
2002 2001
Total Assets $ 92,940 $ 110,859
Total Liabilities $ 20,808 $ 19,824
Minority Interests $ 29,379 $ 32,303
Total Stockholders' Equity $ 42,753 $ 58,732
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and per share information)
Three Months Ended
June 30, 2002 June 30, 2001
Revenues:
License fee income $ -- $ 10,000
Product revenue 274 --
Grant revenue 164 91
Total revenues 438 10,091
Operating expenses:
Cost of sales 253 --
Research and development expenses 5,026 2,651
Non-cash stock compensation expense -- R&D 692 2,013
Marketing, general and administrative
expenses 5,516 9,550
Non-cash stock compensation expense -- MG&A 1,451 5,176
Amortization of patents and goodwill 564 638
Total operating expenses 13,502 20,028
Operating loss (13,064) (9,937)
Total other (expense) income (816) 1,031
Loss from operations before income taxes
and minority interests (13,880) (8,906)
Benefit (provision) for income taxes 75 (228)
Loss from operations before minority
interests (13,805) (9,134)
Minority interests 4,104 4,362
Net loss $ (9,701) $ (4,772)
Loss per common share:
Basic $ (0.49) $ (0.25)
Diluted $ (0.49) $ (0.25)
Weighted average number of common and potential common shares outstanding used
in computation of loss per share:
Basic and diluted 19,634,549 19,503,645
(Note: All share and per-share information has been adjusted retroactively to
reflect the 10% stock dividend declared by Acacia Research on October 22, 2001
and distributed on December 5, 2001.)
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Contact:
Acacia Research Corp., Newport Beach
Rob Stewart (investor relations), 949/480-8300
Fax: 949/480-8301