Exhibit 99
TRANSGENOMIC INC. REPORTS SECOND QUARTER 2006 RESULTS
OMAHA, Neb., Aug. 10 /PRNewswire-FirstCall/ -- Transgenomic Inc. (Nasdaq:
TBIO) today announced financial results for the quarter ended June 30, 2006. The
Company's financial results are presented in the tables that follow.
Second Quarter 2006
The Company reported a net loss of $383,000 or $0.01 per share for the
second quarter of 2006 as compared to a net loss of $998,000 or $0.03 per share
for the second quarter of 2005. The 2006 net loss was comprised of a loss from
continuing operations of $258,000 or $0.01 per share and a loss from
discontinued operations of $125,000. The 2005 net loss was comprised of a loss
from continuing operations of $473,000 or $0.01 per share and a loss from
discontinued operations of $525,000 or $0.02 per share.
Net sales from continuing operations were $6.2 million during the second
quarter 2006, compared to $6.9 million during the comparable period of 2005.
Gross profit from continuing operations was $3.0 million or 49 percent during
the second quarter of 2006 compared to $3.5 million or 51 percent during the
comparable period of 2005. Operating expenses from continuing operations were
$3.4 million during the second quarter of 2006 compared to $3.9 million during
the same period of 2005. The Company generated positive cash flows from
operations of $691,000 during the second quarter of 2006 compared to cash flows
used in operations of $959,000 during the same period of 2005. Cash and cash
equivalents totaled $7.4 million at June 30, 2006.
Six Months Ended June 30, 2006
The Company reported a net loss of $700,000 or $0.01 per share for the
six months ended June 30, 2006 as compared to a net loss of $3.9 million or
$0.12 per share during the comparable period of 2005. The 2006 net loss was
comprised of a loss from continuing operations of $561,000 or $0.01 per share
and a loss from discontinued operations of $139,000. The 2005 net loss was
comprised of a loss from continuing operations of $2.6 million or $0.08 per
share and a loss from discontinued operations of $1.3 million or $0.04 per
share.
Net sales from continuing operations were $12.7 million for the six months
ended June 30, 2006, compared to $13.8 million during the comparable period of
2005. Gross profit from continuing operations was $6.0 million or 48 percent for
the six months ended June 30, 2006 compared to $6.9 million or 50 percent in
2005. Operating expenses from continuing operations were $6.7 million for the
six months ended June 30, 2006 compared to $7.8 million during the comparable
period of 2005. The Company generated positive cash flows from operations of
$665,000 for the six months ended June 30, 2006 compared to cash flows used in
operations of $1.2 million during the same period in 2005.
Comment and Outlook
The Company's President and Chief Executive Officer, Craig Tuttle, indicated
that the Company achieved a significant milestone during the quarter by
generating its first ever positive operating cash flows. He further noted that
his immediate priorities were to maximize opportunities from existing products,
focus and streamline the product development pipeline and to accelerate the
drive to profitability. Tuttle stated, "We are currently looking to
commercialize several new products and services that leverage on enhancing the
capabilities of our highly sensitive and effective mutation screening
technologies. The first of these is our Surveyor(R) CE technology that reduces
the cost and time required for discovering mutations using routine sequencing
platforms. The second is a stronger commercial push of our lab services business
for both research and clinical discovery of disease causing mutations. In this
area, our expertise in analyzing patient samples for mutations in cancer genes
and mitochondrial DNA, as well as the discovery and validation of new disease
markers, is significant. The third major application is based on our core
systems capabilities for isolating DNA from mixed specimens for forensic and
microbial analyses. We are also seeing some growing success in our recently
sourced cytogenetics product portfolio."
Earnings Call
Company management will discuss second quarter 2006 financial results via
teleconference on Thursday, August 10, at 5:00 p.m. Eastern Time. To access the
call via telephone, dial 800-903-0258 or 785-832-2422. 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 Thursday, August 24, 2006. Simply dial 800-839-4012 or
402-220-2981 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(TM) DHPLC systems, reagents,
consumables and assay kits, Hanabi automated cytogenetics systems, and
Transgenomic Discovery and CLIA Lab Services. To date there have been over 1,200
Wave systems installed in over 600 customer sites in over 35 countries and
approximately 1,500 publications utilizing Transgenomic products or services.
Transgenomic Discovery and Lab Services utilize their technology 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.
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Operations
(dollars in thousands except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------------- ----------------------------
2006 2005 2006 2005
------------ ------------ ------------ ------------
NET SALES $ 6,189 $ 6,889 $ 12,686 $ 13,817
COST OF GOODS SOLD 3,140 3,403 6,654 6,932
Gross profit 3,049 3,486 6,032 6,885
OPERATING EXPENSES:
Selling, general
and administrative 2,820 3,306 5,529 6,592
Research and development 531 581 1,135 1,187
3,351 3,887 6,664 7,779
LOSS FROM OPERATIONS (302) (401) (632) (894)
OTHER INCOME (EXPENSE):
Interest expense -- (83) -- (1,740)
Other, net 44 25 88 17
44 (58) 88 (1,723)
LOSS BEFORE INCOME TAXES (258) (459) (544) (2,617)
INCOME TAX EXPENSE -- 14 17 18
LOSS FROM CONTINUING
OPERATIONS (258) (473) (561) (2,635)
LOSS FROM DISCONTINUED
OPERATIONS, NET OF TAX (125) (525) (139) (1,255)
NET LOSS $ (383) $ (998) $ (700) $ (3,890)
BASIC AND DILUTED LOSS
PER SHARE:
From continuing
operations $ (0.01) $ (0.01) $ (0.01) $ (0.08)
From discontinued
operations 0.00 (0.02) 0.00 (0.04)
$ (0.01) $ (0.03) $ (0.01) $ (0.12)
BASIC AND DILUTED
WEIGHTED AVERAGE
SHARES OUTSTANDING 49,189,672 34,237,042 49,187,211 32,122,502
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Statements of Cash Flows
(dollars in thousands)
Six Months Ended
June 30,
---------------------------
2006 2005
------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (700) $ (3,890)
Adjustments to reconcile net loss to net cash
flows used in operating activities:
Depreciation and amortization 956 2,101
Non-cash financing costs -- 1,434
(Gain) on sale of securities -- (9)
Loss on sale of assets 7 --
Other -- 2
Changes in operating assets and liabilities:
Accounts receivable 1,131 1,241
Inventories 785 611
Prepaid expenses and other current assets (90) 399
Accounts payable (477) (841)
Accrued expenses (947) (2,220)
Net cash flows from (used in) operating
activities 665 (1,172)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the maturities and sale of
available for sales securities -- 617
Purchase of property and equipment (178) (671)
Change in other assets (41) (1)
Proceeds from asset sales 40 139
Net cash flows from (used in) investing
activities (179) 84
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in credit line -- 2,050
Payments on term note -- (178)
Issuance of common stock 5 7
Net cash flows from financing activities 5 1,879
EFFECT OF FOREIGN CURRENCY EXCHANGE RATE CHANGES
ON CASH 135 (79)
NET CHANGE IN CASH AND CASH EQUIVALENTS 626 712
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 6,736 1,002
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 7,362 $ 1,714
SUPPLEMENTAL CASH FLOW INFORMATION
Cash paid during the period for:
Interest $ -- $ 316
Income taxes, net 17 18
Non-cash transactions:
Available for sale securities acquired for
goods and services -- 608
Conversions of debt to equity -- 2,579
Transgenomic, Inc.
Summary Financial Results
Unaudited Condensed Consolidated Balance Sheets
(dollars in thousands except per share data)
June 30, December 31,
2006 2005
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 7,362 $ 6,736
Accounts receivable (net of allowances for
bad debts of $378 and $615, respectively) 6,605 7,542
Inventories 2,403 2,990
Prepaid expenses and other current assets 709 653
Current assets of discontinued operations 197 197
Total current assets 17,276 18,118
PROPERTY AND EQUIPMENT, NET 2,030 2,577
OTHER ASSETS:
Goodwill 638 638
Other assets 900 1,074
Non-current assets of discontinued operations 3,061 2,933
$ 23,905 $ 25,340
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,439 $ 1,796
Other accrued expenses 2,949 3,114
Accrued compensation 760 602
Current liabilities of discontinued operations 1,046 1,922
Total current liabilities 6,194 7,434
Long-term debt -- --
Total liabilities 6,194 7,434
STOCKHOLDERS' EQUITY 17,711 17,906
$ 23,905 $ 25,340
SOURCE Transgenomic Inc.
-0- 08/10/2006
/CONTACT: Mike Summers of Transgenomic Inc., +1-402-452-5446,
msummers@transgenomic.com/
/First Call Analyst: /
/FCMN Contact: mmurphy@transgenomic.com /
/Web site: http://www.transgenomic.com
http://www.transgenomic.com/events.asp?id=6 /
(TBIO)