Exhibit 99.1
Interleukin Genetics Reports
Second Quarter Financial Results;
Conference Call Scheduled for 8:30 AM EDT - August 10, 2006
WALTHAM, Mass.--(BUSINESS WIRE)--Aug. 9, 2006--Interleukin
Genetics, Inc. (AMEX: ILI) today reported financial results for the
second quarter and six months ended June 30, 2006. The Company
generated revenue of $1.3 million in the second quarter of 2006 and a
net loss of $923,000, or $(0.04) per basic and diluted common share,
for the quarter. Interleukin Genetics' reported revenues resulted
almost entirely from the processing of genetic assessment tests for
cardiovascular health and general nutrition.
"These strong revenue results for the quarter have validated the
consumer interest in predictive genetic tests that are based on strong
science," said Ken Kornman, Interleukin Genetics' CEO. "Interleukin
has established a solid foundation on which to build our DNA
laboratory business with this first major launch of genetic tests
through our strategic partner, Alticor. We can now focus our efforts
on expanding our product pipeline, preparing for additional product
launches, and developing opportunities to further commercialize our
technology."
Operating Highlights for the quarter ended June 30, 2006 included:
-- The Company reported its first full quarter of revenues from
two new genetic assessment tests.
-- The Company expanded and upgraded its DNA analysis laboratory
operation by adding equipment and staff to increase its
throughput capabilities.
-- The Company secured an exclusive license for weight management
technology from GeneOb as an essential component in the
development of a new genetic assessment test for weight
management intended for future release.
-- The Company initiated a study with Catholic University Center
for High Technology Research and Education in Biomedical
Sciences in Campobasso, Italy to study the link between
inflammation and stroke affecting men and women at a young age
using Interleukin's genetic tests. This study may support the
development of new genetic tests that provide important
information about common diseases.
Revenue for the three months ended June 30, 2006 was $1.3 million
compared to $8,000 in the same period of 2005. The increase was
largely due to the revenues received from processing the
cardiovascular health and general nutrition genetic assessment tests,
both launched in the first quarter of 2006. While Interleukin
anticipates variability of sales due to the inherent uncertainty in
the introduction of new technology, the Company is providing guidance
for fiscal year 2006 annual revenues from genetic testing between $3
to $4 million.
Cost of revenue, which includes fixed overhead costs associated
with laboratory operations, was $408,000 for the three months ended
June 30, 2006, resulting in a gross profit of $936,000, or 70% of
revenue. This gross margin was a result, in part, of one-time supplier
discounts and complimentary support from suppliers received by the
Company during its initial launch phase. For fiscal year 2006, the
Company expects its gross profit margin to be between 45% and 50% from
these genetic tests.
Research and development expenses were $839,000 for the quarter
ended June 30, 2006 compared to $609,000 for the quarter ended June
30, 2005, an increase of approximately 38%. This increase is due to
research and development expenses funded by Alticor under agreements
for the development of new genetic tests, as well as expenses related
to the recording of $73,000 for stock-based compensation expense as a
result of new accounting rules.
General and administrative expenses were $882,000 for the three
months ended June 30, 2006 compared to $1,064,000 during the same
period in the prior year, a decrease of approximately 17%. This
decrease was primarily attributable to the reduction of non-recurring
professional fees incurred by the company in 2006 compared to expenses
incurred in 2005 that were associated with the implementation of
Sarbanes-Oxley Section 404, partially offset by the recording of
$134,000 for stock-based compensation expense as a result of new
accounting rules.
The Company reported a net loss of $923,000, or $(0.04) per basic
and diluted common share, for the second quarter of 2006 compared to a
net loss of $1.8 million, or $(0.08) per basic and diluted common
share, for the second quarter of 2005.
On June 30, 2006, the Company reported cash and cash equivalents
of $2.4 million compared to $3.4 million of cash and cash equivalents
on December 31, 2005. In addition, on June 30, 2006, the Company had
access to $3.5 million under credit facilities with Alticor.
Conference Call Details
To access the live call on August 10, 2006 at 8:30 AM EDT, dial
(877) 502-9272 (domestic) or (913) 981-5581 (international). The call
will also be available live via webcast at www.ilgenetics.com.
Replay access of the teleconference will be available for two
weeks following the call by calling (719) 457-0820 (domestic) or (888)
203-1112 (international). The passcode for the replay is 4134319. The
webcast will be archived following the call at www.ilgenetics.com.
About Interleukin
Interleukin Genetics is a biotechnology company focused on
developing and commercializing personalized health products. The
Company uses its proprietary technology to help in the development of
risk assessment tests, pharmacogenetic tests, nutritional and
therapeutic products based on the genetic variations in people.
Interleukin Genetics has commercialized genetic tests for periodontal
disease risk assessment, cardiovascular risk assessment and general
nutrition assessment, and its current development programs focus on
osteoporosis and weight management. Interleukin expects that these
programs will also lead to products that will personalize the
selection of nutritional and therapeutic products and enable the
managed care industry to improve patient care and better allocate
resources. For more information about Interleukin and its ongoing
programs, please visit http://www.ilgenetics.com.
Certain statements contained herein are "forward-looking"
statements including statements regarding our expectations regarding
future revenues and gross profit margin, our ability to develop
diagnostic, personalized nutritional and therapeutic products to
prevent or treat diseases of inflammation and other genetic
variations, our ability to screen nutritional compounds for their
effects on inflammatory responses and other genetic variations, given
specific genetic patterns and our ability to make progress in
advancing our core technologies. Because such statements include risks
and uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements. Factors that
could cause actual results to differ materially from those expressed
or implied by such forward-looking statements include, but are not
limited to, our ability to develop diagnostic, personalized
nutritional and therapeutic products to prevent or treat diseases of
inflammation and other genetic variations, our ability to screen
nutritional compounds for their effects on inflammatory responses and
other genetic variations, given specific genetic patterns, our ability
to construct a DNA testing laboratory, our ability to complete all of
our key milestones with regard to Alticor programs, our ability to
make progress in advancing our core technologies and our ability to
launch new commercial products and those risks and uncertainties
described in our annual report on Form 10-K for the year ended
December 31, 2005 filed with the Securities and Exchange Commission,
our quarterly reports on Form 10-Q and in other filings made by us
with the Securities and Exchange Commission. We disclaim any
obligation or intention to update these forward-looking statements.
Interleukin Genetics, Inc.
Financial Highlights
Balance sheet data June 30, December 31,
2006 2005
(Unaudited) (Audited)
- ----------------------------------------------
Cash, cash equivalents and marketable
securities $2,425,123 $3,415,174
Total current assets 3,283,551 3,589,656
Total assets $4,687,819 $4,970,075
Total current liabilities $1,162,515 $3,014,742
Total liabilities 3,065,040 4,686,330
Total shareholders' equity 1,622,779 283,745
Total liabilities and shareholders' equity $4,687,819 $4,970,075
Three Months Ended Six Months Ended
Statement of operations June 30, June 30, June 30, June 30,
data (Unaudited) 2006 2005 2006 2005
- ----------------------------------------------------------------------
Revenue $1,344,680 $7,694 $1,576,914 $15,053
Gross profit 936,398 7,694 970,980 15,053
Research and
development expenses 839,375 608,859 1,568,470 1,292,862
General and
administrative
expenses 881,840 1,063,703 1,646,951 1,767,642
-----------------------------------------------
Total operating
expenses 1,721,215 1,672,562 3,215,421 3,060,504
-----------------------------------------------
Loss from operations (784,817) (1,664,868) (2,244,441) (3,045,451)
Total other income and
expense (138,365) (128,923) (268,219) (263,304)
-----------------------------------------------
Net loss $(923,182)$(1,793,791)$(2,512,660)$(3,308,755)
===============================================
Basic and diluted
loss per share $(0.04) $(0.08) $(0.10) $(0.14)
Weighted average
common shares
outstanding 24,190,841 23,653,280 24,105,396 23,629,082
CONTACT: Interleukin Genetics, Inc.
Janet Perry, 781-398-0700