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Affymetrix, Inc. Reports Second Quarter Results
SANTA CLARA, Calif., July 24 /PRNewswire/ -- Affymetrix, Inc. (Nasdaq:AFFX) today reported a net loss of $5.2
million, or $0.23 per share, on revenue of $4.7 million for the quarter ended June 30, 1997, compared to a net loss of $3.8
million, or $0.21 per share, on revenue of $2.3 million for the quarter ended June 30, 1996. For the first six months of 1997,
the Company reported a net loss of $10.1 million, or $0.45 per share, on revenue of $7.6 million, compared to a net loss of
$7.7 million, or $0.43 per share, on revenue of $3.7 million for the first six months of 1996. The increase in revenue for the
three and six months of 1997 compared to the respective periods for 1996 resulted from increases in contract and grant
revenue and product sales. The Company's future financial results may fluctuate significantly due to increased spending, the
amount and timing of contract and grant revenue, and the mix of products sold.
Operating expenses increased to $11.2 million for the quarter ended June 30, 1997, compared to $6.7 million for the same
period in 1996. For the first six months of 1997, operating expenses increased to $20.4 million, compared to $12.6 million
for the same period in 1996. The increase in operating expenses for the three and six month periods of 1997, compared to
the respective periods in 1996, resulted primarily from the Company's expansion of research and increases in administrative
expenses.
As of June 30, 1997, the Company had cash, cash equivalents and short-term investments of $94.6 million. The Company's
initial public offering in 1996 generated net proceeds of $85.1 million from the sale of 6.2 million shares. The Company had
22.6 million shares of common stock outstanding at June 30, 1997.
During the quarter ended June 30, 1997, Affymetrix entered into a corporate consortium to find a five-year research program
in functional genomics at the Whitehead Institute/MIT Center for Genome Research. The corporate consortium is comprised
of Affymetrix, Bristol-Myers Squibb Company and Millennium Pharmaceuticals, Inc. The new program, under the direction
of Eric S. Lander, Ph.D., director of Whitehead's Genome Center, will develop tools and strategies to trace the origin of
genetic diseases, investigate DNA sequence variation, and correlate patterns of gene activity with cellular processes and
disease. In return for enabling this research, Affymetrix will receive certain licensing rights to developments funded by the
consortium. Affymetrix also entered into two new feasibility collaborations during the quarter. In addition, Affymetrix has
collaborative agreements with bioMerieux Vitek, Inc., F. Hoffmann-La Roche Ltd, Genetics Institute, Inc., Glaxo Wellcome
plc, Hewlett-Packard Company, Incyte Pharmaceuticals, Inc., Merck & Co., OncorMed, Inc., and Roche Bioscience.
Affymetrix, Inc. has developed and intends to establish its GeneChip system as the platform of choice for acquiring, analyzing
and managing complex genetic information in order to improve the diagnosis, monitoring and treatment of disease. The
Company's GeneChip system consists of disposable DNA probe arrays containing gene sequences on a chip, instruments to
process the probe arrays, and software to analyze and manage genetic information.
All statements in this press release that are not historical are forward-looking statements. Such statements are subject to risks
and uncertainties that could cause actual results to differ materially from those projected, including, but not limited to,
uncertainties relating to technological approaches, product development, manufacturing and market acceptance, uncertainties
related to cost and pricing of the Company's 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. These and other risk factors are discussed in the reports filed
with the Securities and Exchange Commission, including the Company's annual report on Form 10-K for the year ended
December 31, 1996 and quarterly report on Form 10-Q for the quarter ended March 31, 1997. These forward-looking
statements speak only as of the date hereof. The Company 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 the Company's
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 of Affymetrix, Inc.
AFFYMETRIX, INC.
CONDENSED STATEMENTS OF OPERATIONS
(Dollars and shares in thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
Revenue:
Product $ 942 $ 436 $ 1,362 $ 457
Contract and grant 3,800 1,863 6,188 3,258
Total revenue 4,742 2,299 7,550 3,715
Cost and expenses:
Cost of product revenue 979 606 1,844 707
Research and development 7,212 4,234 12,710 8,310
General and administrativ 3,009 1,901 5,815 3,550
Total operating expenses 11,200 6,741 20,369 12,567
Loss from operations (6,458) (4,442) (12,819) (8,852)
Interest income (expense),net 1,249 665 2,687 1,154
Net loss $(5,209) $(3,777) $(10,132) $(7,698)
Net loss per share (A) $ (0.23) $ (0.21) $ (0.45) $ (0.43)
Shares used in computing net
loss per share (A) 22,613 17,900 22,594 17,782
(A) The three and six months ended June 30, 1996 give effect to the conversion of convertible preferred shares into common
shares upon the completion of the Company's initial public offering in June 1996.
AFFYMETRIX, INC.
CONDENSED BALANCE SHEETS
(Dollars in thousands)
June 30, December 31,
1997 1996
ASSETS (Unaudited)
Current assets:
Cash, cash equivalents and
short-term investments $ 94,645 $108,982
Accounts receivables 4,480 1,888
Inventories 2,038 1,901
Other current assets 393 523
Total current assets 101,556 113,294
Net property and equipment 8,959 5,397
Other assets 985 169
$111,500 $118,860
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and other
accrued liabilities $8,119 $5,626
Noncurrent portion of capital lease
obligation 619 741
Shareholders' equity:
Common stock 158,750 158,687
Deferred compensation (1,087) (1,460)
Accumulated deficit (54,875) (44,743)
Other (26) 9
Total shareholders' equity 102,762 112,493
$111,500 $118,860
SOURCE: Affymetrix Inc.
Contact: Edward M. Hurwitz, Chief Financial Officer of Affymetrix, 408-731-5000
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