Wednesday, May 7, 2008
COMPANY PRESS RELEASE
Transgenomic, Inc. Reports First Quarter 2008 Results
OMAHA, Neb., May 7, 2008 - Transgenomic, Inc. (OTCBB: TBIO.OB) today announced
financial results for the quarter ended March 31, 2008. The Company's financial
results are presented in the tables that follow.
The Company reported net income of $122,000 or $0.00 per share for the first
quarter of 2008 as compared to a net loss of $1.2 million or $0.02 per share for
the first quarter of 2007. All first quarter 2008 net income resulted from
continuing operations. The first quarter 2007 net loss was comprised of a loss
from continuing operations of $1,270,000 or $0.02 per share offset by income
from discontinued operations of $74,000 or $0.00 per share.
Net sales from continuing operations were $6.3 million during the first quarter
of 2008, compared to $5.2 million during the comparable period of 2007. Gross
profit from continuing operations was $3.6 million or 58 percent during the
first quarter of 2008 compared to $2.7 million or 52 percent during the
comparable period of 2007. Operating expenses from continuing operations were
$3.5 million during the first quarter of 2008 compared to $4.0 million during
the same period of 2007. Cash and cash equivalents totaled $5.8 million at March
31, 2008 compared to $5.7 million at December 31, 2007.
Comment and Outlook
Craig Tuttle, the Company's President and Chief Executive Officer, noted, "We
are very pleased to announce another successful quarter with strong revenue
performance which resulted in net profit for the company. We continue to achieve
our plan and this has resulted in our second straight quarter with profitable
results. Our instrument and consumables sales achieved expectations and our two
laboratory services businesses performed very well in the quarter. Our Molecular
Clinical Reference Laboratory achieved revenue over $500,000 in the quarter
which represents growth of 74% over the prior year's first quarter. Our
Pharmacogenomics Research Services Laboratory generated revenues of $467,000
which is almost 500% above the prior year's first quarter result. Our field
sales organization continues to reach new customers for these services
businesses and we expect continued growth from these efforts."
"We continue to make progress in establishing key relationships and
collaborations that will enhance our product portfolio in the future. We are
excited by the recent announcement of our study in agreement with the National
Cancer Institute on the NCI 60 cancer cell lines. In this study, we are
completing a full mitochondrial genome and key nuclear mitochondrial gene
analysis of the NCI 60 cancer cell lines to evaluate the amount of mitochondrial
DNA damage that occurs in these cancer cell lines as well as trying to
understand if there are any linkages between mitochondrial DNA changes and
treatment outcomes. This is the first mitochondrial study on the NCI 60 approved
by the NCI."
"In addition, we believe that recent evaluations of our `OEM' cytogenetics
platform by Quest and LabCorp were positive and may result in further instrument
sales opportunities with both organizations. The Hanabi cytogenetic harvester is
finding strong demand worldwide and we expect it to provide growth opportunities
to us going forward. We are also seeing increasing interest in the high
sensitivity of our mutation detection technology for several diseases, in
particular cancer, as standard DNA sequencing misses many low level mutations in
cancer. We are pursuing several collaborations to validate these findings to
better publicize this advantage from our proprietary technology."
Earnings Call
Company management will discuss first quarter 2008 financial results via
teleconference on Wednesday, May 7, at 5:00 p.m. Eastern Time. To access the
call via telephone, dial 800-894-5910 or 785-424-1052. The Company will also
host a live broadcast of the call over the Internet. To listen to the webcast,
investors should log on to the Company's Investor Relations web page at
http://www.transgenomic.com/events.asp?id=6 and follow the instructions
provided. An archived recording of the conference call will be available and can
be accessed via the web 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, May 21, 2008. Simply dial 800-388-6197 or
402-220-1115 from any telephone.
About Transgenomic
Transgenomic is a global biotechnology company that provides unique products and
services for automated high sensitivity genetic variation and mutation analysis.
Their offerings include systems, products, discovery and laboratory testing
services to the academic and medical research, clinical laboratory and
pharmaceutical markets in the fields of pharmacogenomics and personalized
medicine. Specific offerings include WAVE(R) DHPLC Systems, related consumables
and assay kits, cytogenetics automated systems, Transgenomic Molecular Clinical
Reference Laboratory and Pharmacogenomics Research Services. Transgenomic's two
laboratory services divisions utilize these technologies and expertise to
provide a menu of mutation scanning tests for over 700 cancer-associated genes
and more than 60 validated diagnostic tests to meet the needs of pharmaceutical
and biotech companies, research and clinical laboratories, physicians and
patients. For more information about the innovative systems, products and
services offered by Transgenomic, please visit: www.transgenomic.com.
Transgenomic Cautionary 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 our 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 reports to 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.
For confirmation of release or further information, please contact:
Debra Schneider
Chief Financial Officer
Transgenomic, Inc.
12325 Emmet Street
Omaha, NE 68164
Phone: 402-452-5400
Fax: 402-452-5461
investorrelations@transgenomic.com
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Operations
(dollars in thousands except per share data)
Three Months Ended
March 31,
-----------------------------
2008 2007
------------ ------------
NET SALES $ 6,254 $ 5,222
COST OF GOODS SOLD 2,614 2,514
------------ ------------
Gross profit 3,640 2,708
OPERATING EXPENSES:
Selling, general and administrative 2,975 2,980
Research and development 572 1,058
------------ ------------
3,547 4,038
------------ ------------
INCOME (LOSS) FROM OPERATIONS 93 (1,330)
OTHER INCOME (EXPENSE):
Interest income (expense) 33 61
Other, net (1) 4
------------ ------------
32 65
------------ ------------
INCOME (LOSS) BEFORE INCOME TAXES 125 (1,265)
INCOME TAX EXPENSE 3 5
------------ ------------
INCOME (LOSS) FROM CONTINUING OPERATIONS 122 (1,270)
INCOME FROM DISCONTINUED OPERATIONS,
NET OF TAX -- 74
------------ ------------
NET INCOME (LOSS) $ 122 $ (1,196)
============ ============
BASIC AND DILUTED LOSS PER SHARE:
From continuing operations $ 0.00 $ (0.02)
From discontinued operations -- (0.00)
------------ ------------
$ 0.00 $ (0.02)
============ ============
BASIC WEIGHTED AVERAGE SHARES OUTSTANDING 49,189,672 49,189,672
============ ============
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING 49,192,571 49,189,672
============ ============
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
Three Months Ended
March 31,
-------------------
2008 2007
------- -------
NET CASH FLOWS PROVIDED BY (USED IN) OPERATING ACTIVITIES 225 (771)
NET CASH FLOWS PROVIDED BY (USED IN) INVESTING ACTIVITIES (85) 2,848
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES ON CASH (59) (33)
------- -------
NET CHANGE IN CASH AND CASH EQUIVALENTS 81 2,044
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 5,723 5,868
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 5,804 $ 7,912
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Transgenomic, Inc.
Summary Financial Results
Condensed Consolidated Balance Sheets
(dollars in thousands)
(Unaudited)
March 31, (December 31,
2008 2007
------- -------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 5,804 $ 5,723
Accounts receivable (net of allowances
for bad debts of $372 and $703, respectively) 6,354 5,095
Inventories 4,299 4,586
Prepaid expenses and other current assets 535 759
------- -------
Total current assets 16,992 16,163
PROPERTY AND EQUIPMENT, NET 1,461 1,579
OTHER ASSETS:
Goodwill 638 638
Other assets 698 710
------- -------
$19,789 $19,090
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,212 $ 1,245
Other accrued expenses 3,618 3,152
Accrued compensation 607 450
------- -------
Total current liabilities 5,437 4,847
Other long term liabilities 147 141
------- -------
Total liabilities 5,584 4,988
STOCKHOLDERS' EQUITY 14,205 14,102
------- -------
$19,789 $19,090
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