DIGENE CORPORATION ANNOUNCES FISCAL 1999 THIRD QUARTER RESULTS
- Revenues Increase 48% As Net Loss Narrows 51% -
BELTSVILLE, Md., May 6 /PRNewswire/ -- Digene Corporation (Nasdaq: DIGE) today reported financial results for the fiscal 1999 third quarter ended March 31, 1999.
Total revenues for the 1999 fiscal third quarter increased 48% to a record $4.8 million compared to $3.2 million reported for the comparable quarter last year. Net loss for the 1999 fiscal third quarter was $1.7 million, or $0.12 per share, compared with a net loss of $3.4 million, or $0.25 per share, for the fiscal 1998 third quarter.
For the first nine months of fiscal 1999, total revenues rose 42% to $12.4 million from $8.7 million in the comparable period of fiscal 1998. Net loss for the first nine months of fiscal 1999 was $6.6 million, or $0.46 per share, compared with a net loss of $7.4 million, or $0.57 per share, for the first nine months of fiscal 1998.
Commenting on the financial results, Evan Jones, President and Chief Executive Officer, stated, "Our revenue growth for the quarter can be attributed to the increased market acceptance of our Hybrid Capture(R) II HPV Test in Europe. Additionally, we continue to experience greater demand for our HBV and CMV tests as well as solid growth of equipment sales."
During the quarter, the Company reached several important milestones in its HPV testing business. Most noteworthy, Digene received marketing clearance from the U.S. Food and Drug Administration (FDA) for its Hybrid Capture II HPV Test, a DNA-based technology to detect the human papillomavirus (HPV). Subsequent to this announcement, Empire Blue Cross and Blue Shield of New York announced it would provide coverage for Digene's HPV test for its members. Additionally, the Company received approval to market its Hybrid Capture II Chlamydia and Gonorrhea (CT/GC) tests and HPV tests in both Brazil and Argentina. These recent developments are important milestones for Digene as they substantially increase the potential market for the HPV test, both domestically and internationally.
The importance of clinical testing for HPV was increasingly recognized during the quarter. At the 17th International Papillomavirus Conference in January in Charleston, South Carolina, independent clinical study results were reported from seven countries. Testing directly for HPV, the underlying cause of cervical cancer, was found to be significantly more sensitive than testing with the current Pap smear method while maintaining comparable levels of specificity. The HPV Summit 1999 in February in Chamonix, France highlighted the benefits of HPV DNA testing in cervical cancer screening programs and for all women with abnormal Pap test results. During the quarter the Company initiated a 7,500 women study in Mexico in conjunction that the Mexican National Institute of Public Health (NIPH), the Mexican Institute for Social Security (IMSS) and the Johns Hopkins School of Public Health. This study will evaluate the use of the Digene HCII HPV Test as a primary cervical cancer screening test.
Subsequent to the quarter's end, the Company announced that a Kaiser Permanente study was published in the May 5th issue of the Journal of the American Medical Association (JAMA) demonstrating the benefits of the Digene Hybrid Capture II HPV Test in the early detection of cervical cancer in women with abnormal Pap smears. The researchers concluded that HPV-based follow-up of women with borderline (ASCUS) Pap smear results permits more sensitive detection of high grade cervical disease (HSIL), fewer follow-up colposcopy exams and fewer repeat Pap smears.
Mr. Jones added, "These are exciting times for Digene as we continue to make significant progress in raising awareness of the benefits of our technologies. We are extremely pleased to receive FDA approval of our Hybrid Capture II HPV Test and anticipate its positive impact on both the Company's sales growth and market presence. We also believe the study reported in the highly regarded Journal of the American Medical Association gives our product increased visibility and further validates the advantages of testing for HPV in women with abnormal Pap smears. These studies offer strong evidence that with the help of our products doctors can effectively predict and interfere with the onset of cervical cancer."
Mr. Jones concluded, "We are extremely optimistic about the future of the Company. We are encouraged by the growing recognition of our products by major healthcare payors as well as the marketplace. As a result, we believe we are poised for continued growth in the women's health area and with our blood testing products."
Digene Corporation develops, manufactures and markets DNA and RNA tests for the detection, screening and monitoring of human diseases. Digene's products are designed to help improve clinical outcomes and reduce the overall cost of disease management. Digene's lead product, the Hybrid Capture II HPV Test, aids physicians in identifying women who are most at risk of having or developing cervical disease and cervical cancer. The Digene HPV Test is used in the U.S. as an adjunct to the Pap smear for cervical cancer screening and is being marketed in selected countries as a primary cervical cancer screen either in conjunction with or separate from the Pap smear.
The Company will be hosting a conference call today at 10:30 EST
which will be broadcast simultaneously over the internet. The
broadcast will be hosted at:
webevents.broadcast.com.
This press release may contain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995.
Actual results may vary materially from expectations. Meaningful
factors which could cause actual results to differ from expectations
include, but are not limited to, uncertainty of future profitability,
uncertainty of clinical trial results, uncertainty of market
acceptance, risks inherent in international transactions, limited sales
and marketing experience, dependence on third party reimbursement,
competition, dependence on European distributor, extent of government
regulations, delay in or failure to obtain regulatory approvals,
uncertainty regarding patents and proprietary rights, and inability to
obtain requisite additional financing, as well as other factors
discussed in the Company's Securities and Exchange Commission filings.
DIGENE CORPORATION
SELECTED CONSOLIDATED BALANCE SHEET DATA
(in thousands)
March 31, June 30,
1999 1998
(Unaudited)
ASSETS
Current assets:
Cash and cash
equivalents $11,392 $18,331
Short-term investments 4,410 7,182
Total current assets 25,577 32,703
Total assets $29,253 $35,440
LIABILITIES AND STOCKHOLDERS' EQUITY
Total current liabilities 3,086 4,275
Long-term debt and other
liabilities 22 66
Total stockholders' equity 26,145 31,099
Total liabilities and
stockholders' equity $29,253 $35,440
DIGENE CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended Nine Months Ended
March 31, March 31,
1999 1998 1999 1998
Revenues:
Product sales $4,634 $3,231 $12,091 $8,688
Research and
development contracts 157 -- 311 26
Total revenues 4,791 3,231 12,402 8,714
Costs and expenses:
Cost of product sales 1,696 970 4,100 2,520
Research and
development 1,292 1,519 3,508 3,798
Selling and marketing 2,343 2,997 7,950 6,595
General and
administrative 1,162 1,354 3,809 3,607
Amortization of
intangible assets 37 125 113 383
Loss from operations (1,739) (3,754) (7,078) (8,189)
Other income (expense):
Other income (expense) (235) (59) (177) (144)
Interest income 225 416 832 1,028
Interest expense -- (35) (21) (119)
Loss from operations
before income taxes (1,749) (3,412) (6,444) (7,424)
Provision for income
taxes (14) -- 120 --
Net loss $(1,735) $(3,412) $(6,564) $(7,424)
Basic and diluted net
loss per share $(0.12) $(0.25) $(0.46) $(0.57)
Weighted average shares
outstanding 14,334,094 13,412,271 14,320,153 12,961,727
SOURCE Digene Corporation
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05/06/99 /CONTACT: Charles M.
Fleischman, Chief Operating Officer and Chief Financial Officer of
Digene Corporation, 301-470-6500; Investors - Robert P. Jones, Ephie
Bernstein, or Press - Stacey Nield of Morgen-Walke Associates, Inc.,
212-850-5600, for Digene Corporation/
/Web site: webevents.broadcast.com (DIGE)
CO: Digene Corporation ST: Maryland IN: MTC SU: ERN
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