Exhibit 99
TRANSGENOMIC INC. REPORTS FIRST QUARTER 2006 RESULTS
OMAHA, Neb., May 2 /PRNewswire-FirstCall/ -- Transgenomic Inc.
(Nasdaq: TBIO) today announced financial results for the quarter ended
March 31, 2006. The Company's financial results are presented in the tables
that follow.
The Company reported a net loss of $318,000 or $0.01 per share for the first
quarter of 2006 as compared to a net loss of $2.9 million or $0.10 per share for
the first quarter of 2005. The 2006 net loss was comprised of a loss from
continuing operations of $304,000 or $0.01 per share and a loss from
discontinued operations of $14,000. The 2005 net loss was comprised of a loss
from continuing operations of $2.2 million or $0.07 per share and a loss from
discontinued operations of $730,000 or $0.03 per share.
Net sales from continuing operations were $6.5 million during the first
quarter 2006, compared to $6.9 million during the comparable period of 2005.
Gross profit from continuing operations was $3.0 million or 46 percent during
the first quarter of 2006 compared to $3.4 million or 49 percent during the
comparable period of 2005. Operating expenses from continuing operations were
$3.3 million during the first quarter of 2006 compared to $3.9 million during
the same period of 2005. Cash flows used in operating activities totaled $26,000
during the first quarter of 2006 compared to $213,000 during the same period of
2005. Cash and cash equivalents totaled $6.6 million at March 31, 2006.
Comment and Outlook
Interim CEO, Mike Summers, commented that first quarter 2006 net sales and
operating results were significantly improved compared to the fourth quarter of
2005. "While instrument placements in Europe were relatively consistent,
domestic placements demonstrated improvement. This is largely due to our value
proposition in oncology translational and clinical research. Net sales from
consumables increased 20 percent from the fourth quarter of 2005, and while
year-over-year consumables sales trends are slightly negative, this is largely
attributable to foreign currency fluctuations. Consumables volume was actually
higher during the first quarter of 2006 compared to the same period of 2005."
Regarding the remaining nucleic acids facility in Glasgow, Scotland, Summers
stated, "The timing and cost of decommissioning continues according to plan. We
are pursuing the liquidation of related assets and the necessary regulatory
approvals. The shut-down and liquidation of this facility and the related assets
is not expected to have a significant impact on the results of our operations
beyond the second quarter of 2006."
Turning to liquidity and working capital, operating cash flows during the
quarter were at essentially break even levels. Summers stated, "While we
experienced a modest decrease in cash and cash equivalents during the first
quarter of 2006 due principally to scheduled technological improvements in our
laboratories, we are pleased to report one of our best ever quarterly
performances with regard to operating cash flows."
Earnings Call
Company management will discuss first quarter 2006 financial results via
teleconference on Tuesday, May 2, at 5:00 p.m. EDT. To access the call via
telephone, dial 800-795-1259. 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 listed.
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. EDT
on Tuesday, May 16, 2006. Simply dial 888-566-0826 or 402-220-0118 from any
telephone.
About Transgenomic
Transgenomic provides versatile and innovative research tools and related
consumable products. Transgenomic's BioSystems segment offers its WAVE(R)
Systems and associated consumables. These systems are specifically designed for
use in genetic variation detection and single- and double-strand DNA/RNA
analysis and purification. These systems have broad applicability to genetic
research and molecular diagnostics. To date there have been approximately 1,300
systems installed in over 30 countries around the world. In addition, the
BioSystems segment offers WAVE-based biomarker discovery and validation services
in support of translational research, pre-clinical and clinical studies. For
more information about the innovative genomics research tools developed and
marketed by Transgenomic, please visit the company's Web site at
www.transgenomic.com.
Forward-Looking Statement
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. 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.
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Operations
(dollars in thousands except per share data)
Three Months Ended
March 31,
----------------------------
2006 2005
------------ ------------
NET SALES $ 6,497 $ 6,927
COST OF GOODS SOLD 3,515 3,528
Gross profit 2,982 3,399
OPERATING EXPENSES:
Selling, general and administrative 2,709 3,286
Research and development 604 606
3,313 3,892
LOSS FROM OPERATIONS (331) (493)
OTHER INCOME (EXPENSE):
Interest expense -- (1,657)
Other, net 44 (8)
44 (1,665)
LOSS BEFORE INCOME TAXES (287) (2,158)
INCOME TAX EXPENSE 17 4
LOSS FROM CONTINUING OPERATIONS (304) (2,162)
LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX (14) (730)
NET LOSS $ (318) $ (2,892)
BASIC AND DILUTED LOSS PER SHARE:
From continuing operations $ (0.01) $ (0.07)
From discontinued operations 0.00 (0.03)
$ (0.01) $ (0.10)
BASIC AND DILUTED WEIGHTED AVERAGE SHARES
OUTSTANDING 49,184,722 29,984,491
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Cash Flows
(Dollars in thousands)
Three Months Ended
March 31,
----------------------------
2006 2005
------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (318) $ (2,892)
Adjustments to reconcile net loss to net
cash flows from operating activities:
Depreciation and amortization 437 1,049
Non-cash financing costs -- 1,438
Other -- 3
Changes in operating assets and liabilities (145) 189
Net cash flows from operating activities (26) (213)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment (110) (387)
Change in other assets (23) 68
Proceeds from asset sales -- 100
Net cash flows from investing activities (133) (219)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in Credit Line -- 1,161
Payments on Term Note -- (178)
Issuance of common stock, net of expenses 5 3
Net cash flows from financing activities 5 986
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE
CHANGES ON CASH 28 (58)
NET CHANGE IN CASH AND CASH EQUIVALENTS (126) 496
CASH AND CASH EQUIVALENTS AT BEGINNING OF
PERIOD 6,736 1,002
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 6,610 $ 1,498
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Balance Sheets
(dollars in thousands except per share data)
March 31, December 31,
2006 2005
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 6,610 $ 6,736
Accounts receivable (net of allowances for
bad debts of $581 and $615, respectively) 7,493 7,542
Inventories 2,891 2,990
Prepaid expenses and other current assets 757 653
Current assets of discontinued operations 191 197
Total current assets 17,942 18,118
PROPERTY AND EQUIPMENT, NET 2,312 2,577
OTHER ASSETS:
Goodwill 638 638
Other assets 1,048 1,074
Non-current assets of discontinued
operations 2,970 2,933
$ 24,910 $ 25,340
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,141 $ 1,796
Other accrued expenses 2,905 3,114
Accrued compensation 562 602
Current liabilities of discontinued
operations 1,615 1,922
Total current liabilities 7,223 7,434
Long-term debt -- --
Total liabilities 7,223 7,434
STOCKHOLDERS' EQUITY 17,687 17,906
$ 24,910 $ 25,340
SOURCE Transgenomic Inc.
-0- 05/02/2006
/CONTACT: Robert J. Pogulis, Ph.D. of Transgenomic, Inc.,
+1-845-782-9617, rpogulis@transgenomic.com/
/Web site: http://www.transgenomic.com
http://www.transgenomic.com/events.asp?id=6 /
(TBIO)