|By Business Wire||
|November 5, 2012 04:02 PM EST||
Affymetrix, Inc., (NASDAQ: AFFX) today reported its operating results for the third quarter of 2012. Total revenue for the quarter was $79.6 million, including approximately $17.6 million in revenue from eBioscience during the third quarter of 2012. This compares to total revenue of $64.0 million for the same period of 2011.
The Company reported a net loss of approximately $17.9 million, or $0.25 per diluted share, in the third quarter of 2012, which included the following one-time items: (1) acquisition-related and integration costs of $1.9 million and (2) impairment of the West Sacramento facility of $4.0 million. Excluding these one-time items and recurring amortization of acquired intangible assets of $5.0 million and release of step-up in inventory fair value of $4.5 million, the Company would have reported a net loss of $2.4 million, or $0.03 per diluted share. This compares to a net loss of $9.8 million, or $0.14 per diluted share, in the same period of 2011, which included one-time impairment charges on investments totaling $0.7 million and a reserve on a note receivable from a private biotechnology company of $2.2 million, and recurring amortization of acquired intangible assets of $1.5 million. Excluding these charges, net loss was $5.3 million, or $0.08 per diluted share, for the third quarter of 2011.
Revenue for the third quarter of 2012 was comprised of product revenue of $72.7 million and service and other revenue of $6.9 million. Product revenue included consumable revenue of $50.5 million excluding eBioscience, instrument revenue of $4.6 million and revenue from eBioscience of $17.6 million. This compares to total revenue of $64.0 million in the third quarter of 2011, comprised of product revenue of $57.0 million and service and other revenue of $7.0 million. Product revenue included consumable revenue of $52.9 million and instrument revenue of $4.1 million in the third quarter of 2011.
For the third quarter of 2012, cost of product sales, including eBioscience, was $34.0 million, as compared to $24.6 million in the same period of 2011. Product gross margin was 53%, as compared to 57% in the same period of 2011, the decrease is due primarily to the amortization of the step-up in inventory fair value of $4.5 million. Excluding the inventory step-up amortization, product gross margin for the third quarter of 2012 was 57%. Cost of services and other was $4.0 million compared to $3.0 million in the same period of 2011.
For the third quarter of 2012, operating expenses were $52.8 million, including acquisition- and integration-related non-recurring costs of $1.9 million, and recurring amortization of acquired intangible assets of $3.4 million and eBioscience operating expense of approximately $7.5 million. This compared to operating expenses of $42.2 million in the same period of 2011.
“For the third quarter of 2012 we’ve continued to make steady progress in stabilizing our business. On a constant currency basis, our revenue excluding eBioscience for the third quarter of 2012 was down by about 2% as compared to the same period in the previous year,” said Frank Witney, president and CEO. “In the third quarter of 2012, we generated revenue growth of more than 16% as compared to the third quarter of 2011 in our Genetic Analysis business, which was offset by continued headwinds in our Gene Expression unit. With the addition of eBioscience, we have further diversified our revenues and added important capabilities to provide customers in translational medicine and clinical diagnostics with a comprehensive set of tools to improve healthcare outcomes.”
Third quarter highlights:
- The Company signed a Powered by Affymetrix (PbA) agreement with PathGEN Dx Pte. Ltd., a spin-off molecular diagnostics company founded by researchers from the Genome Institute of Singapore. Under this PbA agreement, PathGEN Dx will develop an in-vitro diagnostic kit for comprehensive pathogen detection using their PathGEN® PathChip and is based on a patented, efficient, and accurate microarray-based protocol and analysis method. The kit will be comprised of PathGEN Dx’s proprietary reagents, an automated software package, and a contract manufactured GeneChip® microarray from Affymetrix. It will detect the presence of more than 70,000 viral and bacterial genomes from a wide variety of human samples, annotate the genomic information, and identify co-infecting pathogens.
- The Company announced the availability of SensationPlus™ FFPE Amplification and 3’ IVT Labeling Kit (SensationPlus™ FFPE Reagent Kit), consisting of RNA amplification and labeling modules, to enable gene expression profiling of formalin-fixed, paraffin-embedded (FFPE) samples on GeneChip 3’ IVT arrays and Almac Xcel™ Array for disease clinical research and retrospective studies. SensationPlusTM FFPE Reagent Kit is an advanced version of the Genisphere® technology Affymetrix licensed last year.
- The Company announced the expansion of its license agreement with Siemens Healthcare Diagnostics for the company’s branched DNA (bDNA) technology whereby Affymetrix is the exclusive licensee for in situ products, including in vitro diagnostics. This expanded license grants Affymetrix rights to develop and sell in situ QuantiGene® ViewRNA products, currently for research use only, in the in vitro diagnostic market. Additionally, this license includes exclusive rights to alkaline phosphatase conjugated oligonucleotides and their use in bDNA methods for in situ detection utilizing Fast Red substrates.
Affymetrix will host a conference call on November 5, 2012 at 2:00 p.m. PT to review its operating results for the third quarter of 2012. A live webcast can be accessed by visiting the Investor Relations section of the Company’s website at www.affymetrix.com. In addition, investors and other interested parties can listen by dialing domestic: (877) 407-8291, international: (201) 689-8345.
A replay of this call will be available from 5:00 p.m. PT on November 5, 2012 until 8:00 p.m. PT on November 12, 2012 at the following numbers: domestic: (877) 660-6853, international: (201) 612-7415. The conference call passcode to access the replay is 401334. An archived webcast of the conference call will be available under the Investor Relations section of the Company's website.
Affymetrix technology is used by the world's top pharmaceutical, diagnostic, and biotechnology companies, as well as leading academic, government, and nonprofit research institutes. More than 2,200 systems have been shipped around the world and almost 26,000 peer-reviewed papers have been published using the technology. Affymetrix is headquartered in Santa Clara, California, and has manufacturing facilities in Cleveland, Ohio, and Singapore. eBioscience is headquartered in San Diego, California and has manufacturing facilities in San Diego and Vienna, Austria. Including eBioscience, the Company has about 1,200 employees worldwide and maintains sales and distribution operations across Europe, Asia and Latin America.
All statements in this press release that are not historical are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act as amended, including statements regarding Affymetrix's "expectations," "beliefs," "hopes," "intentions," "strategies" or the like. Such statements are subject to risks and uncertainties that could cause actual results to differ materially for Affymetrix from those projected, including, but not limited to: Affymetrix's ability to timely and successfully integrate and realize the anticipated strategic benefits and costs savings or other synergies of the acquisition of eBioscience in a cost-effective manner while minimizing the disruption to its business; risks that eBioscience’s future performance may not be consistent with its historical performance; risks relating to Affymetrix's ability to make scheduled payments of the principal of, to pay interest on or to refinance its indebtedness; risks relating to Affymetrix's ability to successfully develop and commercialize new products, including its ability to successfully develop and commercialize novel molecular solutions based on eBioscience’s portfolio of reagents; risks relating to past and future acquisitions, including the ability of Affymetrix to successfully integrate such acquisitions into its existing business; risks of Affymetrix's ability to achieve and sustain higher levels of revenue, higher gross margins and reduced operating expenses; risks relating to Affymetrix’s ability to generate cash in the second half of 2012 after interest and principal payments; uncertainties relating to technological approaches; risks associated with manufacturing and product development; personnel retention; uncertainties relating to cost and pricing of Affymetrix products; dependence on collaborative partners; uncertainties relating to sole-source suppliers; uncertainties relating to FDA and other regulatory approvals; competition; risks relating to intellectual property of others and the uncertainties of patent protection and litigation. These and other risk factors are discussed in Affymetrix's Annual Report on Form 10-K for the year ended December 31, 2011, and other SEC reports. Affymetrix expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Affymetrix's expectations with regard thereto or any change in events, conditions or circumstances on which any such statements are based.
In addition to providing financial measures based on generally accepted accounting principles in the United States (GAAP), Affymetrix has disclosed in this press release its net loss and net loss per share as well as its gross margins for the third quarter of 2012 excluding specified one-time items. Reconciliation of non-GAAP net loss to GAAP net loss can be found in the tables included in this press release. Affymetrix has determined to disclose this financial information to investors because it believes it will be useful, as a supplement to GAAP measures, in comparing Affymetrix’s operating performance in the third quarter of 2012 to the prior-year period. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
|Affymetrix, the Affymetrix logo, GeneChip, and all other trademarks are the property of Affymetrix, Inc.|
CONDENSED CONSOLIDATED BALANCE SHEETS
|September 30,||December 31,|
|(Unaudited)||(See Note 1)|
|Cash and cash equivalents||$||29,026||$||201,937|
|Available-for-sale securities—short-term portion||2,575||7,937|
|Accounts receivable, net||52,534||44,021|
|Deferred tax assets—short-term portion||379||364|
|Property and equipment, net—held for sale||5,000||9,000|
|Prepaid expenses and other current assets||15,078||7,785|
|Total current assets||180,174||314,587|
|Available-for-sale securities—long-term portion||7,337||54,501|
|Property and equipment, net||30,988||30,583|
|Intangible assets, net||157,930||29,525|
|Deferred tax assets—long-term portion||3,445||450|
|Other long-term assets||16,224||8,369|
|LIABILITIES AND STOCKHOLDERS’ EQUITY:|
|Accounts payable and accrued liabilities||$||56,852||$||44,774|
|Convertible notes—short-term portion||3,855||-|
|Term loan—short-term portion||6,375||-|
|Deferred revenue—short-term portion||10,749||9,852|
|Total current liabilities||77,831||54,626|
|Deferred revenue—long-term portion||3,453||3,959|
|Convertible notes—long-term portion||105,000||95,469|
|Term loan—long-term portion||76,500||-|
|Other long-term liabilities||22,345||9,127|
|Additional paid-in capital||757,051||750,332|
|Accumulated other comprehensive income||4,420||2,492|
|Total stockholders’ equity||285,057||274,834|
|Total liabilities and stockholders’ equity||$||570,186||$||438,015|
Note 1: The condensed consolidated balance sheet at December 31,
2011 has been derived from the audited consolidated
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
|Three Months Ended||Nine Months Ended|
|September 30,||September 30,|
|Services and other||6,939||6,986||21,593||19,762|
|COSTS AND EXPENSES:|
|Cost of product sales||33,979||24,647||81,907||70,913|
|Cost of services and other||3,959||3,001||11,057||9,627|
|Research and development||16,498||15,328||43,417||46,894|
|Selling, general and administrative||36,302||26,915||104,752||80,802|
|Total costs and expenses||90,738||69,891||241,133||208,236|
|Loss from operations||(11,114||)||(5,904||)||(29,859||)||(5,866||)|
|Interest income and other, net||(3,933||)||(2,154||)||(1,631||)||(3,549||)|
|Loss before income taxes||(18,040||)||(9,049||)||(35,681||)||(12,281||)|
|Income tax (benefit) provision||(181||)||740||(37,254||)||1,141|
|Net (loss) income||$||(17,859||)||$||(9,789||)||$||1,573||$||(13,422||)|
|Basic net (loss) income per common share||$||(0.25||)||$||(0.14||)||$||0.02||$||(0.19||)|
|Diluted net (loss) income per common share||$||(0.25||)||$||(0.14||)||$||0.02||$||(0.19||)|
|Shares used in computing basic net (loss) income per common share||70,403||69,719||70,181||70,790|
|Shares used in computing diluted net (loss) income per common share||70,403||69,719||70,610||70,790|
ITEMIZED RECONCILIATION BETWEEN GAAP AND NON-GAAP NET (LOSS) INCOME
|Three Months Ended||Nine Months Ended|
|September 30,||September 30,|
|GAAP net (loss) income - diluted||$||(17,859||)||$||(9,789||)||$||1,573||$||(13,422||)|
|Amortization of inventory fair value adjustment||4,536||-||4,855||-|
|Amortization of acquired intangible assets||5,016||1,544||7,919||4,632|
|Acquisition-related transaction costs||326||-||6,093||-|
|Acquisition-related integration costs||1,541||-||1,541||-|
|Share-based compensation charge related to acquisition||-||-||8,265||-|
|Provision (recovery) of notes receivable||-||2,215||(2,215||)||2,215|
|Impairment of non-marketable investments||-||743||-||1,900|
|Impairment of held-for-sale property||4,000||-||4,000||-|
|Income tax benefit related to acquisition||-||-||(37,462||)||-|
|Non-GAAP net loss - diluted||$||(2,440||)||$||(5,287||)||$||(5,431||)||$||(4,675||)|
|Basic net loss per common share||$||(0.03||)||$||(0.08||)||$||(0.08||)||$||(0.07||)|
|Diluted net loss per common share||$||(0.03||)||$||(0.08||)||$||(0.08||)||$||(0.07||)|
|Shares used in computing basic net loss per common share||70,403||69,719||70,181||70,790|
|Shares used in computing diluted net loss per common share||70,403||69,719||70,610||70,790|
Smart Cities are here to stay, but for their promise to be delivered, the data they produce must not be put in new siloes. In his session at @ThingsExpo, Mathias Herberts, Co-founder and CTO of Cityzen Data, will deep dive into best practices that will ensure a successful smart city journey.
Oct. 26, 2016 11:00 AM EDT Reads: 3,166
More and more brands have jumped on the IoT bandwagon. We have an excess of wearables – activity trackers, smartwatches, smart glasses and sneakers, and more that track seemingly endless datapoints. However, most consumers have no idea what “IoT” means. Creating more wearables that track data shouldn't be the aim of brands; delivering meaningful, tangible relevance to their users should be. We're in a period in which the IoT pendulum is still swinging. Initially, it swung toward "smart for smar...
Oct. 26, 2016 10:30 AM EDT Reads: 1,119
Two weeks ago (November 3-5), I attended the Cloud Expo Silicon Valley as a speaker, where I presented on the security and privacy due diligence requirements for cloud solutions. Cloud security is a topical issue for every CIO, CISO, and technology buyer. Decision-makers are always looking for insights on how to mitigate the security risks of implementing and using cloud solutions. Based on the presentation topics covered at the conference, as well as the general discussions heard between sessi...
Oct. 26, 2016 10:15 AM EDT Reads: 5,166
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterpri...
Oct. 26, 2016 10:15 AM EDT Reads: 4,950
The Internet of Things can drive efficiency for airlines and airports. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Sudip Majumder, senior director of development at Oracle, will discuss the technical details of the connected airline baggage and related social media solutions. These IoT applications will enhance travelers' journey experience and drive efficiency for the airlines and the airports. The session will include a working demo and a technical d...
Oct. 26, 2016 10:00 AM EDT Reads: 2,616
The Internet of Things (IoT), in all its myriad manifestations, has great potential. Much of that potential comes from the evolving data management and analytic (DMA) technologies and processes that allow us to gain insight from all of the IoT data that can be generated and gathered. This potential may never be met as those data sets are tied to specific industry verticals and single markets, with no clear way to use IoT data and sensor analytics to fulfill the hype being given the IoT today.
Oct. 26, 2016 07:30 AM EDT Reads: 2,807
@ThingsExpo has been named the Top 5 Most Influential M2M Brand by Onalytica in the ‘Machine to Machine: Top 100 Influencers and Brands.' Onalytica analyzed the online debate on M2M by looking at over 85,000 tweets to provide the most influential individuals and brands that drive the discussion. According to Onalytica the "analysis showed a very engaged community with a lot of interactive tweets. The M2M discussion seems to be more fragmented and driven by some of the major brands present in the...
Oct. 26, 2016 07:30 AM EDT Reads: 11,531
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
Oct. 26, 2016 06:00 AM EDT Reads: 2,067
If you had a chance to enter on the ground level of the largest e-commerce market in the world – would you? China is the world’s most populated country with the second largest economy and the world’s fastest growing market. It is estimated that by 2018 the Chinese market will be reaching over $30 billion in gaming revenue alone. Admittedly for a foreign company, doing business in China can be challenging. Often changing laws, administrative regulations and the often inscrutable Chinese Interne...
Oct. 26, 2016 06:00 AM EDT Reads: 1,430
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?
Oct. 26, 2016 05:45 AM EDT Reads: 2,563
SYS-CON Events announced today that Streamlyzer will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Streamlyzer is a powerful analytics for video streaming service that enables video streaming providers to monitor and analyze QoE (Quality-of-Experience) from end-user devices in real time.
Oct. 26, 2016 05:30 AM EDT Reads: 1,056
You have great SaaS business app ideas. You want to turn your idea quickly into a functional and engaging proof of concept. You need to be able to modify it to meet customers' needs, and you need to deliver a complete and secure SaaS application. How could you achieve all the above and yet avoid unforeseen IT requirements that add unnecessary cost and complexity? You also want your app to be responsive in any device at any time. In his session at 19th Cloud Expo, Mark Allen, General Manager of...
Oct. 26, 2016 05:30 AM EDT Reads: 1,028
SYS-CON Events announced today that Pulzze Systems will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Pulzze Systems, Inc. provides infrastructure products for the Internet of Things to enable any connected device and system to carry out matched operations without programming. For more information, visit http://www.pulzzesystems.com.
Oct. 26, 2016 05:00 AM EDT Reads: 2,592
One of biggest questions about Big Data is “How do we harness all that information for business use quickly and effectively?” Geographic Information Systems (GIS) or spatial technology is about more than making maps, but adding critical context and meaning to data of all types, coming from all different channels – even sensors. In his session at @ThingsExpo, William (Bill) Meehan, director of utility solutions for Esri, will take a closer look at the current state of spatial technology and ar...
Oct. 26, 2016 04:30 AM EDT Reads: 1,764
Cloud based infrastructure deployment is becoming more and more appealing to customers, from Fortune 500 companies to SMEs due to its pay-as-you-go model. Enterprise storage vendors are able to reach out to these customers by integrating in cloud based deployments; this needs adaptability and interoperability of the products confirming to cloud standards such as OpenStack, CloudStack, or Azure. As compared to off the shelf commodity storage, enterprise storages by its reliability, high-availabil...
Oct. 26, 2016 04:30 AM EDT Reads: 1,200
The IoT industry is now at a crossroads, between the fast-paced innovation of technologies and the pending mass adoption by global enterprises. The complexity of combining rapidly evolving technologies and the need to establish practices for market acceleration pose a strong challenge to global enterprises as well as IoT vendors. In his session at @ThingsExpo, Clark Smith, senior product manager for Numerex, will discuss how Numerex, as an experienced, established IoT provider, has embraced a ...
Oct. 26, 2016 04:15 AM EDT Reads: 1,179
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, will be adding the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining sensor...
Oct. 26, 2016 03:45 AM EDT Reads: 1,041
In the next forty months – just over three years – businesses will undergo extraordinary changes. The exponential growth of digitization and machine learning will see a step function change in how businesses create value, satisfy customers, and outperform their competition. In the next forty months companies will take the actions that will see them get to the next level of the game called Capitalism. Or they won’t – game over. The winners of today and tomorrow think differently, follow different...
Oct. 26, 2016 02:30 AM EDT Reads: 1,073
“Media Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. CloudBerry Backup is a leading cross-platform cloud backup and disaster recovery solution integrated with major public cloud services, such as Amazon Web Services, Microsoft Azure and Google Cloud Platform.
Oct. 26, 2016 02:30 AM EDT Reads: 1,479
Ask someone to architect an Internet of Things (IoT) solution and you are guaranteed to see a reference to the cloud. This would lead you to believe that IoT requires the cloud to exist. However, there are many IoT use cases where the cloud is not feasible or desirable. In his session at @ThingsExpo, Dave McCarthy, Director of Products at Bsquare Corporation, will discuss the strategies that exist to extend intelligence directly to IoT devices and sensors, freeing them from the constraints of ...
Oct. 26, 2016 01:15 AM EDT Reads: 3,139