You still following this, Nigel? There have been changes, and more are coming. CEO Short has stepped down. I've heard they are looking for a replacement that is more product-oriented, aparrently feeling Mr. Short was more R&D oriented. Here they signal missing 2005 estimates & restructuring:
>>SAN DIEGO, Oct. 24 /PRNewswire-FirstCall/ -- Diversa Corporation (Nasdaq: DVSA - News) today reported financial results for the quarter and nine months ended September 30, 2005. Revenues for the quarter and nine months ended September 30, 2005, respectively, were $12.8 million and $39.8 million, compared to $12.9 million and $39.4 million for the same periods in 2004. The net loss for the quarter and nine months ended September 30, 2005 was $12.1 million, or $0.27 per share, and $35.0 million, or $0.80 per share, respectively, compared to $9.2 million, or $0.21 per share, and $27.4 million, or $0.63 per share, for the same periods in 2004. At September 30, 2005, the Company had cash, cash equivalents, and short-term investments totaling $70.0 million.
For the quarter and nine months ended September 30, 2005, the Company achieved increases in revenues from product-related sales compared to the same periods in 2004. Product-related revenues increased 11% and 63% for the quarter and nine months ended September 30, 2005 as compared to the same periods in 2004. These increases are primarily attributable to increased product revenue and profit-sharing associated with Phyzyme(TM) XP phytase sold through the Company's collaboration with Danisco Animal Nutrition.
For the quarter and nine months ended September 30, 2005 collaborative revenues decreased to $8.1 million and $26.3 million compared to $8.4 million and $28.2 million for the same periods in 2004. The decreases in collaborative revenues are primarily attributable to revenue earned in 2004 under the Company's former Zymetrics joint venture agreements with Syngenta, which were not repeated in the current periods. These decreases were partially offset by increased revenue from new or expanded agreements entered into in 2005, including collaborations with Merck and Cargill.
Revenues have historically fluctuated from period to period and likely will continue to fluctuate substantially in the future based upon the timing and composition of funding under existing and future collaboration agreements, regulatory approval timelines for new products, and an expected increase in product-related revenue based upon new product introductions.
The increase in the net loss for the quarter and nine months ended September 30, 2005 as compared to the same periods in 2004 was attributable primarily to the decrease in revenue from milestones and exclusivity fees and the Company's continued shift in revenue mix toward a higher percentage of product sales. Gross margins for the quarter and nine months ended September 30, 2005 were negative principally as a result of increased fixed costs related to expanded manufacturing capacity to support anticipated growth in product-related revenues. The Company expects gross margins to be negatively impacted until product sales volumes have achieved a level that is in line with its existing manufacturing capacity. The Company incurred increased research and development costs associated with internal product development and third-party costs incurred on behalf of the Company's collaborators. Selling, general and administrative expenses increased due to higher costs associated with expansion of the sales force to support the Company's proprietary products.
"While we have made progress this year in advancing key internal and partnered programs and products, we are disappointed with our financial performance during the third quarter," said Edward T. Shonsey, Diversa's Chief Executive Officer. "We believe in the long-term potential of our recently launched products; however, we are currently experiencing longer sales cycles than originally anticipated for our Luminase product line, as well as longer than expected regulatory approval timelines for our Quantum Phytase and Ultra-Thin enzyme products. Looking forward to our fourth quarter, we expect product sales to increase; however, we believe that we will be challenged to meet the 2005 revenue, net loss, and cash usage guidance previously provided."
"We are currently reviewing all of our programs and operations with the goal to accelerate the development and commercialization of products which we believe have the greatest potential while we reduce unnecessary expenditures. This will enable us to better position the Company to reduce our loss and cash usage while we realize the greatest value from our programs and move the Company toward profitability," continued Mr. Shonsey. "We expect to provide more guidance in the coming weeks as we complete this review."<<
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>>SAN DIEGO, Oct. 6 /PRNewswire-FirstCall/ -- Diversa Corporation (Nasdaq: DVSA - News) announced today that Jay M. Short, Ph.D., has resigned from his position as the Company's President and Chief Executive Officer, and a member of the Company's Board of Directors by mutual agreement with the Board. Edward T. Shonsey, the Company's Executive Vice President of Internal Development, has been appointed Chief Executive Officer on an interim basis.
Dr. James Cavanaugh, Chairman of the Company's Board of Directors, said, "On behalf of the entire Board, I would like to thank Jay for his many contributions as he guided Diversa during its transition from a startup organization to a public company. Having been a founder of the Company and having established a strong foundation of powerful discovery and evolution technologies, he leaves the Company well-positioned with a pipeline of products and programs from which the Company expects to derive significant value in the future as it moves forward."
"Diversa is entering a new phase of growth, one that focuses on strengthening its commercial and marketing leadership to move the Company toward profitability. Diversa will position both its Bioscience and Pharmaceutical programs to be consistent with this goal," continued Dr. Cavanaugh. "We are very fortunate to have Ed Shonsey at this transitional phase in the Company's history. His strong strategic business and marketing skills, plus his proven business leadership during times of organizational transformation, will play a critical role in Diversa's future."
Mr. Shonsey joined Diversa in January 2003 and has served as Diversa's Executive Vice President of Internal Development, with responsibility for Diversa's operations and human resources function. Mr. Shonsey's past experience also includes significant global leadership positions in such companies as Procter & Gamble and Pioneer Hi-Bred International, as well as Northrup King Company and Novartis Seeds Inc., where he served as President and CEO.<<
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Still just watching, but might buy retracements under $5. I would expect the shares to be weak until it announces details of restructuring. A well received choice for new CEO would also help. Interesting -- and probably good -- that Shonsey and Co. are not waiting for the new guy to make some changes.
Edit: Make that retracements under $4. Already down to $4.25 after hours.
Cheers, Tuck |
