EBIO beats by a penny (the one ananlyst expected a 4 cent loss), hits revenue exactly:
>>BOTHELL, Wash., Nov. 5 /PRNewswire-FirstCall/ -- Epoch Biosciences, Inc. (Nasdaq: EBIO - News), a provider of proprietary products that accelerate genomic analysis, today reported revenues for the third quarter of 2002 increased to $2.7 million compared to $1.9 million in the like period in 2001. The net loss during the quarter was $861,000, or $0.03 per share, compared with a net loss of $1.1 million, or $0.04 per share, in the third quarter of 2001.
William G. Gerber, chief executive officer of Epoch, said, "This has been a landmark period for us in terms of product validation. Amersham and Qiagen, two global bioscience leaders, chose Epoch products as strategic additions to their research product portfolios. In another form of validation, the National Cancer Institute assessed the performance of our MGB Eclipse(TM) Probe Systems in a scientific study and reported very positive results."
"Further, the quarterly results demonstrate our ability to continue to execute on our business plan. We attained record levels of MGB Eclipse sales and narrowed our quarterly loss as well as posting improvements in other financial measures," Gerber said. "We continue to establish, communicate and deliver on our aggressive operating objectives, and step by step are realizing our goal of becoming a product company."
Quarterly Financial Highlights
Total revenues of $2.7 million for the quarter ended September 30, 2002 increased 36% compared to the third quarter of 2001. Product sales increased 45% to $2.0 million from $1.4 million a year ago, and increased 16% from $1.7 million in the second quarter of 2002. The strength in product sales was the result of higher sales of MGB Eclipse Probe Systems, including initial shipments to Amersham Biosciences, Epoch's new worldwide sales and marketing partner, offset by anticipated decreases in chemical intermediate shipments to collaborative partners. License fees and royalties increased to $277,000 from $51,000 a year ago, indicative of the growth in product sales of the company's corporate partners. Contract research revenues decreased slightly to $407,000 from $539,000 a year ago due to a decrease in research activity provided to collaborative partners.
Total operating expenses for the third quarter were $3.5 million compared to $3.2 million in the comparable quarter of 2001. Cost of product sales increased to $1.1 million from $870,000 in the third quarter of 2001 due to increased product sales, but decreased from 64% to 53% as a percentage of product sales. This significant improvement is due to economies of scale from the increase in product sales, a different product mix -- more MGB Eclipse Probe Systems and less chemical intermediates -- and the company's ongoing focus on increasing efficiencies in its manufacturing operations. Research and development expenses during the quarter were comparable to the third quarter of 2001 at approximately $1.1 million. Sales and marketing expenses increased from $157,000 in last year's third quarter to $284,000 in the current quarter as a result of increases in sales and marketing personnel and related activities. General and administrative expenses increased slightly to $1.2 million from $1.1 million in the comparable quarter of the prior year.
For the nine months ended September 30, 2002, Epoch reported revenues of $7.4 million compared to $5.3 million in the first three quarters of 2001. The net loss for the first nine months of 2002 was $3.3 million, or $0.13 per share, compared to $3.6 million, or $0.14 per share, for the same period in 2001.
At September 30, 2002, the Company had unrestricted cash and cash equivalents of $3.9 million.
Third Quarter Milestones
Early in the quarter, Epoch entered into a worldwide sales and marketing agreement with Amersham Biosciences, the life sciences business of Amersham plc (LSE: NYSE: OSE: AHM). Under the agreement, Amersham became the global sales and marketing partner in the research field of Epoch's MGB Eclipse Probe Systems for gene expression and SNPs. The first revenues from this alliance contributed to product sales in the third quarter of 2002. This morning, Epoch announced a co-exclusive license and supply agreement with QIAGEN N.V. (Nasdaq: QGENF, Frankfurt, Neuer Markt: QIA) for the distribution in the research field of products that incorporate MGB Eclipse Probe Systems for gene expression. Both of Epoch's partners must meet certain milestones to retain their exclusive status. Under both agreements, Epoch is the sole manufacturer and retains all other fields, including diagnostics, forensics, food testing, environmental testing and bio-terrorism testing.
Epoch also announced the closing of two debt financing agreements during the quarter with Silicon Valley Bank, a $2.5 million term loan and a $750,000 working capital line of credit. Proceeds from the financings will be used primarily to expand manufacturing capacity for accelerating product sales and for general corporate purposes.
The Company also reported on results from a pilot study completed during the quarter by scientists at the National Cancer Institute's Advanced Technology Center that evaluated the performance of the MGB Eclipse Probe System in real-time PCR assays. The study assessed the performance of MGB Eclipse and other technology platforms in investigating single nucleotide polymorphisms (SNPs) in a high throughput setting. The NCI found that MGB Eclipse facilitated the efficient development of robust assays for use in a genotyping library. Researchers also found that certain difficult SNPs could only be detected with MGB Eclipse Probe Systems. The pilot trial is the prelude to a massive study analyzing up to 800 SNPs in a population of 20,000 cancer patient samples.
Conference Call Information
Epoch management will hold a conference call at 11:00 a.m. EST (8:00 a.m. PST) today, Tuesday, November 5, 2002, to discuss third quarter financial results. To access the call, dial 888-277-8128 for domestic and 973-582-2729 for international. An audio replay will be available for seven days; domestic callers dial 877-519-4471 and international callers dial 973-341-3080. The passcode for the replay is 3558834.
A live webcast of the call may be accessed at viavid.com. To listen, go to viavid.com approximately 15 minutes prior to the call to register and download/install any necessary audio software. A replay will be available for 45 days.
About Epoch Biosciences
Epoch Biosciences develops proprietary products with commercial applications in the genomics and molecular diagnostics fields. Epoch's technology has numerous applications including the detection of inherited diseases and single nucleotide polymorphisms (SNPs) to identify individuals at risk for disease or adverse drug reactions. The Company's chemical reagents enhance the performance of genetic analysis procedures, and are compatible with the majority of DNA analysis systems currently employed or under development for research and diagnostic uses. The Company licenses its chemistries to leading genomics companies for incorporation in their systems and distribution to end-users. Epoch also manufactures and sells specialty oligonucleotides and genetic detection systems employing its proprietary chemistry. Information about Epoch is available at www.epochbio.com.
Epoch Biosciences Cautionary Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties, including but not limited to the possibility that the potential products utilizing the Company's technology may be ineffective or, although effective, may be uneconomical to market; or, that third parties hold proprietary rights that preclude Epoch or its licensees from marketing them; or, that third parties market a superior product. These factors and others may cause actual results to differ materially from the anticipated results. Additional information about potential risk factors that could affect Epoch Biosciences' business and financial results is included in Epoch's annual report on Form 10-K for the year ended December 31, 2001 and in other reports filed from time to time with the Securities and Exchange Commission. These forward-looking statements speak only as to the date of this release and Epoch undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events, or otherwise.
Epoch Biosciences, Inc.Condensed Statements of Operations
(in thousands, except per share data)
(unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
Revenues:
Product sales $1,975 $1,359 $5,199 $3,515
License fees and
royalties 277 51 710 214
Contract research 407 539 1,520 1,539
Total revenues 2,659 1,949 7,429 5,268
Operating expenses:
Cost of product sales 1,053 870 3,347 2,497
Research and
development 1,051 1,079 3,237 3,405
Sales and marketing 284 157 986 331
General and
administrative 1,151 1,078 3,220 3,042
Total operating
expenses 3,539 3,184 10,790 9,275
Operating loss (880) (1,235) (3,361) (4,007)
Interest income, net 19 88 81 365
Net loss $(861) $(1,147) $(3,280) $(3,642)
Net loss per share
- basic and
diluted $(0.03) $(0.04) $(0.13) $(0.14)
Weighted average number
of common shares
outstanding -- basic
and diluted 25,661 25,640 25,657 25,570
Epoch Biosciences, Inc.
Condensed Balance Sheets
(in thousands)
September 30, December 31,
2002 2001
(unaudited)
Cash and cash equivalents $3,888 $7,489
Accounts receivable 1,057 354
Inventory 473 158
Other current assets 426 437
Total current assets 5,844 8,438
Property and equipment, net 3,990 3,852
Intangible assets, net 4,193 4,415
Other non-current assets 639 601
Total assets $14,666 $17,306
Accounts payable and accrued liabilities $2,066 $1,559
Deferred revenue -- current portion 856 620
Long term obligations -- current portion 222 13
Total current liabilities 3,144 2,192
Deferred revenue 2,173 3,026
Long term obligations 648 148
Stockholders equity 8,701 11,940
Total liabilities and stockholders' equity $14,666 $17,306<<
Cheers, Tuck |
