infobeat.com
04:01 PM ET 04/23/98
Affymetrix Reports First Quarter Results
SANTA CLARA, Calif., April 23 /PRNewswire/ -- Affymetrix, Inc.,
(Nasdaq: AFFX) today reported results for the first quarter of 1998. During
the period ended March 31, 1998, revenue grew to $9.8 million, up from
$2.8 million in the first quarter of 1997. The growth in revenues resulted
from increased sales of GeneChip(R) systems and probe arrays, as well as
increased contract revenue arising from the commencement of the Company's
first two EasyAccess(TM) subscription-based supply agreements.
Total costs and expenses increased to $16.7 million for the quarter ended
March 31, 1998, compared to $9.2 million for the same period in 1997. The
increase in total costs and expenses for the three month period of 1998,
compared to the respective period in 1997, resulted primarily from higher cost
of sales arising from the increase in sales of GeneChip systems and probe
arrays as well as increases in research and product development activities,
and increases in selling, general and administrative expenses, including
increases in legal and marketing costs.
For the first quarter, the Company reported a net loss of $5.9 million,
or $0.26 per share, compared to a net loss of $4.9 million, or $0.22 per
share, for the same period in 1997.
As of March 31, 1998, the Company had cash, cash equivalents and
short-term investments of $62.6 million. The Company had approximately
22.9 million shares of common stock outstanding at March 31, 1998. On
April 15, 1998, the Company received an additional $50 million from the
closing of the sale of 1,634,522 shares of Series AA Preferred Stock to Glaxo
Wellcome Americas, Inc. The Series AA Preferred Stock is convertible into
1,257,229 shares of Affymetrix common stock at approximately $40 per share.
During the first quarter of 1998, Affymetrix continued to advance its
GeneChip technology in its three principal applications: gene expression
monitoring, polymorphism discovery and disease management. In the first
business area, gene expression monitoring, Affymetrix entered into several new
agreements in the first quarter of 1998 to supply GeneChip expression arrays
to customers and allow certain of these customers to offer databases or
services using the Company's GeneChip technology. The most significant of
these supply agreements was signed in January when Genetics Institute, a
long-time customer and collaborator, became Affymetrix' second EasyAccess
customer, giving Genetics Institute the ability to take advantage of the
high-volume discounts this subscription-based access plan provides.
Affymetrix also entered into new supply agreements with Rhone-Poulenc Rorer
and Sanofi Recherche in the first quarter of 1998. In March, Affymetrix
expanded its relationship with Oncormed, Inc., to co-develop and commercialize
a gene expression database and allow Oncormed to provide a screening service
using GeneChip expression monitoring arrays.
In the Company's second major business area, polymorphism discovery,
Affymetrix continued its efforts to identify the common polymorphisms across
the human genome. The Company has now identified more than 3,500 such
polymorphisms. To accelerate this program, Affymetrix entered into several
new collaborations. In January, Affymetrix entered into an agreement with
Progenitor, Inc., to develop custom GeneChip probe arrays to identify
variations in asthma patients' DNA and to test those variations for
correlations with asthma and inflammation. In March, Affymetrix signed an
agreement with Gemini Research Limited, the UK's first clinical genomics
company, to identify genetic polymorphisms related to osteoporosis. Pursuant
to this collaboration, Affymetrix will develop GeneChip probe arrays to screen
a comprehensive library of osteoporosis candidate genes from select twin
population samples provided by Gemini. The information generated from these
collaborations will be added to the polymorphism database being generated by
Affymetrix.
In Affymetrix' third business area, disease management, Affymetrix
achieved several important milestones in the first quarter of 1998. Most
important was an expansion of the bioMerieux Vitek, Inc., collaboration to
allow bioMerieux to commercialize GeneChip HIV assays on Affymetrix' existing
instrumentation platform and on a new instrumentation system being developed
as part of the ongoing bacteriology collaboration. In addition, Oncormed
began offering a clinical research service using the Company's GeneChip p53
assay through its CLIA-certified reference laboratory.
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, 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.
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 for
Affymetrix 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 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. These and other risk factors are
discussed in Affymetrix' annual report on Form 10-K for the year ended
December 31, 1997. 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 the
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 of
Affymetrix, Inc. Additional Company information is available at
www.affymetrix.com.
CONDENSED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31,
Revenue: 1998 1997
Product $3,697 $420
Contract and grant 6,056 2,388
Total revenue 9,753 2,808
Costs and expenses:
Cost of product revenue 2,493 865
Research and development 8,511 5,812
Selling, general and administrative 5,741 2,492
Total costs and expenses 16,745 9,169
Loss from operations (6,992) (6,361)
Interest income, net 1,092 1,438
Net loss (5,900) $(4,923)
Basic and diluted net loss per share $(0.26) $(0.22)
Shares used in computing basic
and diluted net loss per share 22,831 22,575
AFFYMETRTX, INC.
CONDENSED BALANCE SHEETS
(In thousands)
March 31, December 31, $9,621
Noncurrent portion of capital
$95,160 $101,170
SOURCE Affymetrix, Inc.
CONTACT: Edward M. Hurwitz, Vice President and Chief Financial Officer,
408-731-5000, or Anne Bowdidge, Manager of Investor Relations, 408-731-5925,
both of Affymetrix, Inc./
/Web site: affymetrix.com
(AFFX)
CO: Affymetrix, Inc.
ST: California
IN: CPR
SU: ERN
EB-KF
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