April 16 /PRNewswire/ -- Diversa Corporation (Nasdaq: DVSA - news) today reported revenues of $8.2 million for the quarter ended March 31, 2001, an increase of 86% over first quarter 2000 revenues of $4.4 million. The net loss for the first quarter of 2001 was $1.4 million, or $0.04 per share, compared to a net loss of $6.0 million, or $0.20 per share on a pro forma basis, for the first quarter of 2000. The reported losses for the first quarters of 2001 and 2000 include non-cash, stock-based compensation charges of $0.7 million and $5.6 million, respectively.
The increase in revenues resulted from a number of strategic collaboration agreements signed in 2000 and a drug discovery and development agreement signed in early 2001. The two most significant components of first quarter 2001 revenues are related to Zymetrics, the Company's agricultural products contract joint venture with Syngenta Seeds AG, and Innovase LLC, the Company's 50/50 industrial enzyme joint venture with The Dow Chemical Company.
Total operating expenses for the quarter were $12.7 million compared to $11.4 million for the same period in 2000. Excluding non-cash, stock-based compensation charges, operating expenses increased by $6.1 million compared to the first quarter in 2000. This increase was primarily attributable to higher research and development expenses associated with research activities under strategic collaboration agreements signed in 2000 and 2001, as well as the continued investment in several key internal programs and technologies. Selling, general and administrative expenses also increased due to expansion of administrative infrastructure to support Diversa's growth and requirements as a public company.
Interest and other income for the quarter was $3.2 million compared to $1.4 million for the same period in 2000. This increase was primarily due to interest income as a result of higher average cash balances following Diversa's initial public offering in February 2000.
At March 31, 2001, the Company had cash, cash equivalents, short-term investments, and receivables totaling $206.1 million compared to $211.8 million at December 31, 2000.
``During the first quarter, we made significant progress in achieving our 2001 objectives,'' stated Jay M. Short, Ph.D., President and Chief Executive Officer.
First quarter 2001 accomplishments include:
-- The signing of a drug discovery, development, and license agreement
with IntraBiotics Pharmaceuticals, Inc. to identify and develop novel
small molecules that demonstrate antibacterial or antifungal
properties. This second small molecule drug discovery deal closely
followed the announcement of a drug discovery research collaboration
with GlaxoSmithKline in December 2000.
-- The receipt of five patents, the most significant of which included
patents covering methods for liquid phase expression screening of
libraries made from DNA of more than one species, Diversa's Gene Site
Saturation Mutagenesis(TM) (GSSM(TM)) evolution technology, and
high-throughput screening of gene libraries made from mixed
populations of organisms using fluorescent detection.
-- The sequencing of the Streptomyces diversa(TM) microorganism under a
DNA sequencing collaboration with Celera Genomics. The sequence data
from this proprietary discovery and production host microbe should
enable faster discovery and development of novel molecules of
pharmaceutical interest from Diversa's PathwayLibrary(TM) collections.
``Completion of these milestones contributes to Diversa's goal of rapidly developing products within our extensive pipeline and maximizing the full capability of our proprietary discovery and evolution technologies,'' continued Dr. Short.
Diversa Corporation is a global leader in developing and applying proprietary technologies to discover and evolve novel genes and gene pathways from diverse environmental sources. The Company is utilizing its fully integrated approach to develop novel enzymes and other biologically active compounds, such as orally active drugs, produced by these genes and gene pathways. The Company's proprietary evolution technologies facilitate the optimization of genes found in nature to enable product solutions for the pharmaceutical, agricultural, chemical processing, and industrial markets. Within these broad markets, the Company is targeting key multi-billion dollar market segments where the Company believes its technologies and products will create high value and competitive advantages for strategic partners and customers. The Company's strategic partners are market leaders and include Aventis Animal Nutrition S.A., Celanese Ltd., Celera Genomics, Finnfeeds International Ltd (a unit of Danisco Cultor), The Dow Chemical Company, GlaxoSmithKline plc, IntraBiotics Pharmaceuticals, Inc., Invitrogen Corporation, and Syngenta (formerly Novartis) Agribusiness Biotechnology Research, Inc. The Company has also formed joint ventures with The Dow Chemical Company (named Innovase LLC) and with Syngenta Seeds AG (named Zymetrics).
Statements in this press release that are not strictly historical are ``forward-looking'' and involve a high degree of risk and uncertainty. These include statements related to the financial guidance provided below, the discovery, identification, and/or development of novel molecules, the development of products, and the exploitation of the Company's technologies, all of which are prospective. Such statements are only predictions, and the actual events or results may differ materially from those projected in such forward-looking statements. Factors that could cause or contribute to differences include, but are not limited to, risks involved with the Company's new and uncertain technologies, risks associated with the Company's dependence on patents and proprietary rights, risks associated with the Company's protection and enforcement of its patents and proprietary rights, the Company's dependence on existing collaborations, the ability of the Company to commercialize products using the Company's technologies, the development or availability of competitive products or technologies, and the future ability of the Company to enter into and/or maintain collaboration and joint venture agreements. These factors and others are more fully described in the Company's filings with the Securities and Exchange Commission, including, but not limited to, the Company's Annual Report on Form 10-K for the year ended December 31, 2000. These forward-looking statements speak only as of the date hereof. The Company expressly disclaims any intent or obligation to update these forward-looking statements.
Note: Gene Site Saturation Mutagenesis(TM), GSSM(TM), PathwayLibrary(TM), and Streptomyces diversa(TM) are trademarks of Diversa Corporation.
Selected Financial Information
Condensed Statements of Operations
(unaudited, in thousands, except per share amounts)
Three Months
Ended March 31,
2001 2000
Revenues:
Collaborative revenue $7,881 $4,064
Grant and product revenue 334 342
Total revenues 8,215 4,406
Expenses:
Research and development 9,868 4,574
Selling, general and administrative 2,122 1,303
Non-cash, stock-based compensation 747 5,555
Total operating expenses 12,737 11,432
Loss from operations (4,522) (7,026)
Interest and other income, net 3,168 1,414
Loss before income taxes (1,354) (5,612)
Provision for income tax --- 75
Net loss before preferred dividends (1,354) (5,687)
Dividends on preferred stock --- 310
Net loss applicable to common shares ($1,354) ($5,997)
Basic and diluted net loss per common share ($0.04) ($0.32)
Weighted average shares used in computing basic
and diluted net loss per common share 34,963 18,979
Pro forma basic and diluted net loss per common
share N/A ($0.20)
Weighted average shares used in computing pro
forma basic and diluted net loss per common share N/A 29,976(1)
Net loss excluding non-cash, stock-based
compensation ($607) ($442)
Pro forma basic and diluted net loss per common
share excluding non-cash, stock-based
compensation ($0.02) ($0.01)
(1)Weighted average shares used in computing pro forma basic and diluted
net loss per common share assume all outstanding redeemable
convertible preferred stock, which converted into common stock upon
the Company's initial public offering in February 2000, had converted
at the original dates of issuance.
Condensed Balance Sheet
(in thousands)
March 31, December 31,
2001 2000
(unaudited)
Cash, cash equivalents and short-term
investments $204,123 $211,256
Other current assets 7,666 6,436
Property and equipment, net 17,455 14,903
Other assets 3,458 2,666
Total assets $232,702 $235,261
Current liabilities $7,805 $10,368
Deferred revenue 20,668 22,337
Long-term liabilities 9,219 8,482
Stockholder's equity 195,010 194,074
Total liabilities and stockholder's equity $232,702 $235,261
2001 Updated Financial Guidance
The following statements are forward-looking, and actual results may differ materially. Please see page 2 of this press release for a description of certain risk factors and Diversa's quarterly and annual reports on file with the Securities and Exchange Commission for a more complete description of risks. The Company will not provide any further material guidance on analysts' financial models beyond the information provided in this press release.
Below is an update to the 2001 financial guidance previously provided during the Company's webcast conference call on January 30, 2001. Revenue guidance remains at $35 million for the year, with a slight shift between the quarters. The updated net loss guidance, which reflects higher interest income and lower operating expenses, has improved to $17.5 million for the year, or $0.50 per share.
(in millions, except per share data)
(unaudited)
Financial Guidance
Q1 2001
Actual Q2 Q3 Q4 Annual
Total revenues $8.2 $8.6 $8.8 $9.4 $35.0
Research &
development 9.9 12.0 14.0 14.3 50.2
Selling, general &
administrative 2.1 2.6 2.6 2.6 9.9
Non-cash,
stock-based
comp 0.8 0.8 0.7 0.6 2.9
Total operating
expenses 12.8 15.4 17.3 17.5 63.0
Loss from
operations (4.6) (6.8) (8.5) (8.1) (28.0)
Interest and
other income,
net 3.2 3.1 2.2 2.0 10.5
Net loss ($1.4) ($3.7) ($6.3) ($6.1) ($17.5)
Net loss per common share (based upon weighted-average
shares of 35 million) ($0.50)
2001 cash "burn" $18
SOURCE: Diversa Corporation |
