AFFX earnings news release :
Affymetrix Reports Record 2000 Results
SANTA CLARA, Calif., Feb. 5 /PRNewswire/ -- Affymetrix, Inc., (Nasdaq: AFFX)
today reported record results for its fourth quarter and fiscal year 2000.
Highlights of the year included the shipment of more than 200,000
GeneChip(R) arrays and the sale of more than 150 GeneChip systems
culminating in more than $200 million in total revenue. After adjusting for the
impact of acquisition related charges and Affymetrix' funding of the public
mouse genome sequencing effort, Affymetrix' core operations achieved their
second consecutive quarter of profitability.
"During 2000 we successfully scaled manufacturing and sustained high yields.
We implemented another cycle of Moore's Law by reducing feature sizes
resulting in twice the genetic information content on a single array. In
addition, we grew our worldwide sales and support infrastructure which led to
our customer base expanding by more than three-fold," said Stephen P.A.
Fodor, Ph.D., Chairman and Chief Executive Officer of Affymetrix. "This
operational growth was complemented by major strategic initiatives that will
continue to allow Affymetrix to provide leading-edge whole genome products
to the worldwide research community."
Fourth quarter total revenue was $59.4 million, up 70% over the fourth
quarter of 1999. For the year, total revenue was $200.8 million, an increase of
84% over 1999. Product sales in the fourth quarter were $51.3 million, up
58% over the fourth quarter of 1999. For the year, product sales were $173.5
million, an increase of 77% over 1999. The increase in product sales during
the fourth quarter and year ended December 31, 2000 over the comparable
periods in 1999 was the result of increased sales of GeneChip probe arrays,
increased placements of instruments (primarily the GeneChip system and
components, the 417 Arrayer(TM) and the 428 Scanner(TM)) and increased
technology access fees earned under EasyAccess(TM) contracts.
Other revenues, which include license fees, royalties and research revenue
were $8.1 million for the fourth quarter and $27.3 million for the year,
compared to $2.5 million and $10.9 million in the corresponding periods of
1999. The increase in other revenues was attributable primarily to the
expansion of licensing initiatives.
Total costs and expenses, excluding charges resulting from the acquisitions of
Genetic MicroSystems, Inc. and Neomorphic, Inc., increased to $64.8 million for
the quarter from $41.7 million for the comparable period in 1999. For the year
2000, total costs and expenses, excluding acquisition related charges,
increased to $221.2 million, compared to $139.3 million in 1999. The increase
in operating expenses for the quarter and year compared to the respective
periods in 1999, resulted primarily from the Company's expansion of
commercial activities, increases in research and development activities,
including those associated with Perlegen Sciences, Inc. and increased legal
costs arising from ongoing patent litigation.
Excluding acquisition related charges, Affymetrix reported a net loss of $3.4
million or $0.06 per share in the fourth quarter compared to a net loss of $5.5
million, or $0.10 per share in the fourth quarter of 1999. For the year ended
December 31, 2000, Affymetrix reported a net loss excluding acquisition
related charges of $13.1 million or $0.24 per share compared with a net loss
of $27.6 million or $0.54 per share in 1999. Excluding the one time expense of
$3.5 million associated with Affymetrix' sponsorship of the public mouse
genome sequencing initiative in the fourth quarter, Affymetrix earned $0.1
million, representing the Company's second consecutive profitable quarter
from core operations.
In March 2000, Affymetrix acquired Genetic MicroSystems, a privately-held
instrumentation company specializing in DNA array technology, in a transaction
accounted for as a pooling of interests. In connection with the acquisition,
Affymetrix issued approximately 1.0 million shares of common stock and
approximately 0.1 million options to acquire shares, and incurred direct
acquisition costs of approximately $2.4 million. Comparative 1999 results have
been restated to reflect the pooling.
During the fourth quarter of 2000, Affymetrix completed its acquisition of
Neomorphic, a privately held bioinformatics company, for $75.6 million. As
consideration for the acquisition, Affymetrix issued approximately 1.3 million
shares of Affymetrix common stock and paid cash in the amount of $2.4 million
in exchange for all of the outstanding shares of Neomorphic. Affymetrix also
granted options to purchase approximately 0.1 million Affymetrix shares in
exchange for the assumption of all of Neomorphic's stock options.
In connection with the Neomorphic transaction, the Company recognized a
$15.0 million one-time charge for in-process R&D. The Company also recorded
goodwill and other intangibles of $26.8 million, which are being amortized over
five and three years. For the fourth quarter, amortization of goodwill and
other purchased intangibles amounted to $1.0 million. The Company also
recorded $30.0 million of deferred stock compensation which will be amortized
over the remaining vesting period, principally three years. In the fourth
quarter, this amortization amounted to $2.1 million.
Including acquisition related charges, Affymetrix reported a net loss of $21.5
million, or $0.38 per share in the fourth quarter compared to a net loss of $5.5
million, or $0.10 per share in the fourth quarter of 1999. For the year ended
December 31, 2000, including acquisition related charges, Affymetrix reported
a net loss of $33.6 million or $0.61 per share compared to a net loss of $27.6
million or $0.54 per share in 1999.
During the fourth quarter of 2000 and first part of 2001, Affymetrix continued
to expand the market for DNA arrays by entering into numerous GeneChip
array supply agreements with pharmaceutical, biotechnology and academic
customers. For the year, Affymetrix introduced 17 new products, shipped more
than 200,000 arrays, more than 150 GeneChip systems, and over 375
Affymetrix Arrayers and Scanners. To date, Affymetrix has sold over 400
GeneChip systems and over 650 Affymetrix Arrayers and Scanners.
During the year, Affymetrix further encouraged widespread adoption of its
technology by increasing the number of EasyAccess, AcademicAccess(TM) and
BiotechAccess(TM) customers. Recently, the Company added Biogen, Inc.,
Pharmacia Corporation, and Byk Gulden, The Pharmaceutical Group of ALTANA
AG to Affymetrix' growing list of EasyAccess Silver customers. Additionally,
Affymetrix added Sumitomo Pharmaceuticals Co., Ltd. to its EasyAccess Silver
customer list through an agreement with Amersham Pharmacia Biotech KK.
Affymetrix also signed BiotechAccess agreements with Lexicon Genetics
Incorporated, PPD Discovery, the drug discovery subsidiary of PPD, Inc.,
MediGene AG, Isis Pharmaceuticals, Inc., Iceland Genomics Corporation,
Celgene-Signal Research Division and Sangamo BioSciences, Inc.
Also during 2000, Affymetrix accelerated its commitment to expand the DNA
array field through its licensing program. Under this program, Affymetrix
provides both commercial and internal use licenses to its patent estate, which
includes more than 100 issued and 300 pending patents in the United States.
In the fourth quarter, the Company signed licensing agreements with Genomic
Solutions Inc., Tanox Pharma, B.V., a subsidiary of Tanox, Inc. and the Medical
Research Council, bringing the total number of licenses granted to nearly 30.
During the year, Affymetrix also announced several strategic initiatives that
will position the Company to uniquely benefit from the flood of new
information arising from worldwide genome sequencing efforts. First was the
acquisition of Neomorphic, a privately held computational genomics company.
The acquisition will enable Affymetrix to offer scientists an integrated view of
the genome on chips that are linked to databases of networked scientific
information, along with powerful new tools to interpret and understand the
assembled genomic sequences. The Company also formed a new genomics
discovery subsidiary, Perlegen Sciences, to focus on biological and
pharmaceutical research by using Affymetrix' technology to scan 50 genomes
and identify the millions of genetic variations and patterns in those variations
among individuals. Finally, Affymetrix joined a public-private initiative to
decipher the mouse genome sequence in order to make the mouse sequence
freely and broadly available to researchers worldwide.
Affymetrix is a leader in developing and commercializing systems to acquire,
analyze and manage complex genetic information in order to improve the
quality of life. The Company's GeneChip system consists of disposable DNA
probe arrays containing gene sequences on a chip, reagents for use with the
probe arrays, a scanner and other instruments to process the probe arrays
and software to analyze and manage genetic information. The Company's
spotted array system enables individual researchers to create and analyze
custom microarrays on an easy-to-use, cost efficient platform. Additional
information on Affymetrix and GeneChip technology can be found at
www.affymetrix.com.
Investors may listen to Affymetrix' management discuss this announcement by
dialing domestic: 800-280-2151; international: 415-904-2425; passcode:
1959 on Monday, February 5, 2001 from 2:00-3:00 p.m. PST. A replay of this
call will be available until February 8, 2001 at 4:00 p.m. PST, domestic:
800-633-8284; international: 858-812-6440; reservation number: 17729416.
To access a Webcast of the conference call, visit Affymetrix' Website at
www.affymetrix.com.
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' "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,
uncertainties relating to technological approaches, product development,
manufacturing, market acceptance, personnel retention, equity dilution,
uncertainties related to the ability to realize benefits from acquisitions,
uncertainties related 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' Annual Report on Form 10-K for the year ended December 31, 1999
and other SEC reports, including its Quarterly Reports on Form 10-Q for
subsequent quarterly periods. 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' expectations with regard thereto or any change in events,
conditions, or circumstances on which any such statements are based.
Affymetrix, GeneChip and the Affymetrix logo are registered trademarks used
by Affymetrix, Inc.
AFFYMETRIX, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
2000 1999 2000 1999
Revenue:
Product $51,319 $32,455 $173,546 $98,168
Research 1,051 1,323 5,780 8,059
License fees and
royalties 7,049 1,149 21,504 2,847
Total revenue 59,419 34,927 200,830 109,074
Costs and expenses:
Cost of product
revenue 19,922 13,501 69,039 42,219
Research and
development 18,494 12,396 57,384 43,524
Selling, general and
administrative 26,508 15,838 94,842 53,590
Merger related costs -- -- 2,395 --
Amortization of
deferred stock
compensation 2,118 -- 2,118 --
Amortization of
purchased intangibles 997 -- 997 --
Charge for in-process
technology 14,989 -- 14,989 --
Total costs and
expenses 83,028 41,735 241,764 139,333
Loss from operations (23,609) (6,808) (40,934) (30,259)
Interest income, net 2,717 1,259 7,976 4,755
Net loss before
income taxes and
preferred stock
dividends (20,892) (5,549) (32,958) (25,504)
Provision for
income taxes (600) -- (600) --
Net loss after
provision for
income taxes (21,492) (5,549) (33,558) (25,504)
Preferred stock
dividends -- -- -- (2,055)
Net loss attributable
to common
stockholders $(21,492) $(5,549) $(33,558) $(27,559)
Basic and diluted
net loss per
common share $(0.38) $(0.10) $(0.61) $(0.54)
Weighted-average
shares used in
computing basic and
diluted net loss
per common share 56,167 53,886 55,035 51,167
Note:
Certain prior year balances have been reclassified to conform with
the current year presentation.
AFFYMETRIX, INC.
CONDENSED CONSOLIDATED PROFORMA STATEMENTS OF OPERATIONS *
EXCLUDING ACQUISITION-RELATED CHARGES
(In thousands, except per share amounts)
Three Months Ended Twelve Months Ended
December 31, December 31,
2000 1999 2000 1999
Revenue:
Product $ 51,319 $ 32,455 $ 173,546 $ 98,168
Research 1,051 1,323 5,780 8,059
License fees and
royalties 7,049 1,149 21,504 2,847
Total revenue 59,419 34,927 200,830 109,074
Costs and expenses:
Cost of product
revenue 19,922 13,501 69,039 42,219
Research and
development 18,494 12,396 57,384 43,524
Selling, general
and administrative 26,508 15,838 94,842 53,590
Total costs and
expenses 64,924 41,735 221,265 139,333
Loss from operations (5,505) (6,808) (20,435) (30,259)
Interest income, net 2,717 1,259 7,976 4,755
Net loss before
income taxes and
preferred stock
dividends (2,788) (5,549) (12,459) (25,504)
Income taxes and
preferred stock
dividends (600) -- (600) (2,055)
Net loss attributable
to common
stockholders $ (3,388) $ (5,549) $ (13,059) $ (27,559)
Basic and diluted
net loss per
common share $(0.06) $(0.10) $(0.24) $(0.54)
Weighted-average
shares used in
computing basic
and diluted
net loss per
common share 56,167 53,886 55,035 51,167
*The above Condensed Consolidated Proforma Statements of Operations are
presented for illustrative purposes only and are not prepared in accordance
with generally accepted accounting principles.
AFFYMETRIX, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(In thousands)
Dec. 31, Dec. 31,
2000 1999
ASSETS
Current assets:
Cash and cash equivalents $7,263 $12,677
Available-for-sale securities 428,767 213,763
Accounts receivable 53,104 24,646
Inventories 17,234 12,792
Other current assets 2,524 4,159
Total current assets 508,892 268,037
Net property and equipment 56,245 40,775
Intangible assets 35,809 8,965
Notes receivable from employees 2,113 1,074
Other assets 16,728 7,736
$619,787 $326,587
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities $50,592 $29,926
Deferred revenue 19,544 6,468
Current portion of capital lease obligation 22 261
Total current liabilities 70,158 36,655
Noncurrent portion of capital lease obligation 60 --
Obligation to Beckman Coulter, Inc. 5,000 5,000
Convertible subordinated notes 375,000 150,000
Common stock purchase rights 3,000 3,000
Stockholders' equity:
Common stock 571 543
Notes receivable from shareholders (994) --
Additional paid-in-capital 340,548 256,467
Accumulated deficit (157,761) (124,203)
Other (15,795) (875)
Total stockholders' equity 166,569 131,932
$619,787 $326,587
SOURCE Affymetrix, Inc. |
