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Caliper Life Sciences Reports Third Quarter 2007 Financial Results- Q3 Revenue of $36.7 Million, 38% Increase over Q3 2006 -
HOPKINTON, Mass., Nov. 7 /PRNewswire-FirstCall/ -- Caliper Life Sciences, Inc. (NASDAQ: CALP) , a leading provider of tools and services for drug discovery and life sciences research, today announced its third quarter financial results for 2007. Third quarter revenues were $36.7 million, an increase of 38% from $26.5 million in the same period in 2006. Net loss for the quarter was $2.4 million ($0.05 per share) compared to a net loss of $13.5 million ($0.33 per share) in the same quarter of 2006. Caliper attributed its revenue growth to its August 2006 Xenogen acquisition, growth in its drug discovery services, and increased microfluidics license fees. The third quarter 2007 reduction in net loss was due to strong revenue growth as well as an improved post-acquisition cost structure, including ongoing cost reduction initiatives.
Third quarter highlights include:
-- Revenues of $36.7 million exceeded the company's previously announced
third quarter guidance of $31 to $35 million.
-- Product revenue was even with the third quarter of 2006. Microfluidics
instrument and reagent sales generated 49% growth as a result of the
early 2007 introduction of the LabChip EZ Reader and continued success
with the LabChip 90 instrument platform. This was offset by IVIS
imaging revenue which declined $1.5 million due to timing issues
associated with grant funding and seasonal irregularities associated
with sales in Europe. The company anticipates a recovery to a
sustainable 16% growth rate in imaging products in the fourth quarter
and beyond. IVIS instrument revenue has averaged 23% growth since the
Xenogen acquisition in August 2006.
-- Service revenue grew 71% versus the third quarter of 2006. The
previously announced Toxcast contract with the U.S. Environmental
Protection Agency for in vitro compound toxicity screening was
initiated during the quarter and was a significant contributor to
service revenue growth.
-- License fees and contract revenue increased $6.0 million versus the
prior year quarter. During the quarter, Caliper and a licensee agreed
to expand the scope of earlier license agreements between the companies.
Also, Wako Pure Chemical Industries, Ltd. made milestone payments for
intellectual property rights pursuant to its previously announced
license agreement with Caliper.
-- Combined product and service revenue grew 17% in the third quarter,
including 7% organic growth. ("Organic growth" includes the change in
revenues from Xenogen products and services over the comparable prior
year period when Xenogen was a separate legal entity.) Combined product
and service gross margins improved to 41%, a gain of over 1000 basis
points, due to economies of scale derived from consolidation of Xenogen
manufacturing into Caliper facilities, the benefits of initiatives to
reduce material costs including overseas sourcing and volume gains in
the service business.
-- Positive operating cash flow of $1.9 million was generated in the
quarter.
"We posted strong overall financial results in the third quarter," said Kevin Hrusovsky, president and CEO of Caliper. "The EPA Toxcast screening project is having a positive financial effect and we believe it will be a major contributor to our services revenue in 2008. Our new products continue to gain traction in the market, particularly our kinase profiling tools - the LabChip EZ Reader and ProfilerPro reagents." Mr. Hrusovsky continued, "Revenue from microfluidics technology licenses contributed to us exceeding our third-quarter targets. We were pleased to secure these transactions but reiterate that such transactions are likely not a source of recurring revenue going forward. For this reason, as well as the strong potential of our new microfluidics products, we are focusing our investments on further building our direct channel business." Hrusovsky added, "We were disappointed in the performance of our IVIS products for the third quarter; however, we fully expect a healthy rebound in the fourth quarter. Most importantly, our bottom line has improved $11.1 million, or $0.28 per share, versus the third quarter of 2006. We believe we are well positioned to continue growing our top line and improving margins for the upcoming quarter and for 2008." GAAP Guidance Revenue guidance for the fourth quarter of 2007 is $37 to $40 million (growth of 7% to 15%) and for the full year is $137 to $140 million (growth of 27% to 30%). Supplemental Non-GAAP Financial Results Caliper supplements its GAAP financial reporting with certain non-GAAP financial measures. A reconciliation of Caliper's GAAP to non-GAAP Statements of Operations is provided at the end of this release under "Adjusted Consolidated Statements of Operations." Adjusted results of operations exclude stock-based compensation charges and acquisition-related revenue adjustments and expenses, such as amortization of intangibles and restructuring charges and credits. Caliper believes that providing this additional information enhances investors' understanding of the financial performance of Caliper's operations and increases the comparability of its current financial statements to prior periods. In the third quarter of 2007, Caliper reported adjusted revenue of $36.8 million, an increase of 34% over the third quarter of 2006, and adjusted net income of $1.4 million or $0.03 per share in comparison with an adjusted net loss of $6.4 million or ($0.16 per share) in the third quarter of 2006. Caliper will discuss its third quarter results in a conference call to be held today, November 7, at 9:00 a.m. EST. To participate in the call, please dial 888-680-0869 five to ten minutes prior to the call and use the participant passcode 24722133. International callers can access the call by dialing 617-213-4854 and entering the same passcode. You may also pre- register for the call at https://www.theconferencingservice.com/prereg/key.process?key=PRDRQ7FGB. A live webcast of the call can be accessed at www.fulldisclosure.com or on the Caliper website at www.caliperLS.com in the Events section of the Investor Relations page. A webcast replay of the call will remain available until Caliper's earnings call for the fourth quarter of 2007. Telephone replays of the conference call will be available approximately two hours after the completion of the call on November 7, 2007 until November 14, 2007. To access a telephone playback of the proceedings, dial 888-286-8010 and use the participant passcode 21426002. International callers can access the playback by dialing 617-801-6888 and using the same participant passcode. About Caliper Life Sciences Caliper Life Sciences is a premier provider of cutting-edge technologies enabling researchers in the life sciences industry to create life-saving and enhancing medicines and diagnostic tests more quickly and efficiently. Caliper is aggressively innovating new technology to bridge the gap between in vitro assays and in vivo results and then translating those results into cures for human disease. Caliper's portfolio of offerings includes state-of-the-art microfluidics, lab automation & liquid handling, optical imaging technologies, and discovery & development outsourcing solutions. For more information please visit www.caliperLS.com. The statements in this press release regarding future events, including statements regarding Caliper's expected financial results for the fourth quarter ending December 31, 2007 and for fiscal year 2007, Caliper's beliefs regarding the future growth rate performance of its IVIS imaging products, the strong potential of Caliper's microfluidics products, and the effect of the EPA Toxcast contract on future revenues and margins, are "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements as a result of a number of factors, including the risks that unexpected difficulties may be encountered in gaining wider commercial adoption of Caliper's new products, that the EPA may not expand the screening of compounds under the Toxcast contracts as much or as rapidly as expected by Caliper, and that Caliper's expectations regarding demand for its products and services may not materialize if capital spending by Caliper's customers declines, if competitors introduce new competitive products, or if Caliper is unable to convince potential customers regarding the superior performance of its drug discovery and imaging systems and other products. Further information on risks faced by Caliper are detailed under the caption "Risks Related To Our Business" in Caliper's Annual Report on Form 10- K for the year ended December 31, 2006. Our filings are available on a web site maintained by the Securities and Exchange Commission at http://www.sec.gov. Caliper does not undertake any obligation to update forward-looking or other statements in this release or the conference call.
NOTE: Caliper, Xenogen, IVIS and LabChip are registered trademarks, and
EZ Reader and ProfilerPro are trademarks, of Caliper Life Sciences, Inc. or
its subsidiaries.
CALIPER LIFE SCIENCES, INC.
SELECTED FINANCIAL INFORMATION
(unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
2007 2006 2007 2006
Revenue:
Product revenue $18,504 $18,501 $54,787 $45,509
Service revenue 10,172 5,934 28,044 16,366
License fees and contract
revenue 8,045 2,091 17,620 11,276
Total revenue 36,721 26,526 100,451 73,151
Costs and expenses:
Cost of product revenue 11,278 12,816 33,800 31,430
Cost of service revenue 5,511 4,155 16,600 9,733
Cost of license revenue 971 73 2,238 73
Research and development 5,666 8,663 19,088 18,049
Selling, general and
administrative 13,399 12,535 39,312 29,940
Amortization of intangible
assets 2,522 2,020 7,593 4,528
Restructuring charges, net 22 23 30 97
Total costs and expenses 39,369 40,285 118,661 93,850
Operating loss (2,648) (13,759) (18,210) (20,699)
Interest income (expense),
net (205) 99 (321) 470
Other income, net 446 101 365 379
Benefit (provision) for
income taxes (21) 26 (180) (197)
Net loss $(2,428) $(13,533) $(18,346) $(20,047)
Net loss per share, basic
and diluted $(0.05) $(0.33) $(0.39) $(0.56)
Shares used in computing
net loss per common share,
basic and diluted 47,425 40,939 47,212 36,078
CALIPER LIFE SCIENCES, INC.
SELECTED FINANCIAL INFORMATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
September 30, December 31,
2007 2006
(unaudited) *
Assets
Current assets:
Cash and cash equivalents $14,174 $11,634
Marketable securities 3,770 13,303
Accounts receivable, net 28,874 30,822
Inventories 21,816 18,758
Other current assets 2,469 1,996
Total current assets 71,103 76,513
Property and equipment, net 11,630 13,182
Intangible assets, net 45,413 52,806
Goodwill 80,836 80,776
Other assets 1,822 1,499
Total assets $210,804 $224,776
Liabilities and stockholders' equity
Current liabilities and loans payable $56,493 $49,661
Other long-term obligations 9,110 17,706
Stockholders' equity 145,201 157,409
Total liabilities and stockholders'
equity $210,804 $224,776
* Derived from audited financial statements for the year ended December 31,
2006.
CALIPER LIFE SCIENCES, INC.
SELECTED FINANCIAL INFORMATION
(unaudited)
ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three Months Ended
September 30, 2007
Stock-
based Other Adjusted
Reported Comp Adjustments (1)
Revenues:
Product revenue (4) $18,504 $- $- $18,504
Service revenue 10,172 - - 10,172
License fees and contract revenue (4) 8,045 - 56 8,101
Total revenues 36,721 - 56 36,777
Cost and Expenses:
Cost of product revenue (2),(4) 11,278 (87) - 11,191
Cost of service revenue (2) 5,511 (22) - 5,489
Cost of license revenue (4) 971 - 30 1,001
Research and development (2),(5) 5,666 (159) - 5,507
Selling, general and administrative(2) 13,399 (968) - 12,431
Amortization of intangible assets (3) 2,522 - (2,522) -
Restructuring charges (3) 22 - (22) -
Total costs and expenses 39,369 (1,236) (2,514) 35,619
Operating loss (2,648) 1,236 2,570 1,158
Interest income (expense), net (205) - - (205)
Other income, net 446 - - 446
Benefit (provision) for income taxes (21) - - (21)
Net income (loss) $(2,428) $1,236 $2,570 $1,378
Net income (loss) per
share - basic and diluted $(0.05) $0.03
Shares used in computing net loss per
share - basic and diluted 47,425 47,425
Three Months Ended
September 30, 2006
Stock-
based Other Adjusted
Reported Comp Adjustments (1)
Revenues:
Product revenue (4) $18,501 $- $273 $18,774
Service revenue 5,934 - - 5,934
License fees and contract revenue (4) 2,091 - 555 2,646
Total revenues 26,526 - 828 27,354
Cost and Expenses:
Cost of product revenue (2),(4) 12,816 (124) 9 12,701
Cost of service revenue (2) 4,155 (44) - 4,111
Cost of license revenue (4) 73 - 54 127
Research and development (2),(5) 8,663 (232) (2,898) 5,533
Selling, general and administrative(2) 12,535 (1,027) - 11,508
Amortization of intangible assets (3) 2,020 - (2,020) -
Restructuring charges (3) 23 - (23) -
Total costs and expenses 40,285 (1,427) (4,878) 33,980
Operating loss (13,759) 1,427 5,706 (6,626)
Interest income (expense), net 99 - - 99
Other income, net 101 - - 101
Benefit (provision) for income taxes 26 - - 26
Net income (loss) $(13,533) $1,427 $5,706 $(6,400)
Net income (loss) per
share - basic and diluted $(0.33) $(0.16)
Shares used in computing net loss per
share - basic and diluted 40,939 40,939
See accompanying Notes to Adjusted Consolidated Statements of Operations
CALIPER LIFE SCIENCES, INC.
SELECTED FINANCIAL INFORMATION
(unaudited)
ADJUSTED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Nine Months Ended
September 30, 2007
Stock-
based Other Adjusted
Reported Comp Adjustments (1)
Revenues:
Product revenue (4) $54,787 $- $- $54,787
Service revenue 28,044 - - 28,044
License fees and contract revenue (4) 17,620 - 1,017 18,637
Total revenues 100,451 - 1,017 101,468
Cost and Expenses:
Cost of product revenue (2),(4) 33,800 (329) - 33,471
Cost of service revenue (2) 16,600 (99) - 16,501
Cost of license revenue (4) 2,238 - 138 2,376
Research and development (2),(5) 19,088 (623) - 18,465
Selling, general and administrative(2) 39,312 (2,919) - 36,393
Amortization of intangible assets (3) 7,593 - (7,593) -
Restructuring charges (3) 30 - (30) -
Total costs and expenses 118,661 (3,970) (7,485) 107,206
Operating loss (18,210) 3,970 8,502 (5,738)
Interest income, net (321) - - (321)
Other income, net 365 - - 365
Provision for income taxes (180) - - (180)
Net income (loss) $(18,346) $3,970 $8,502 $(5,874)
Net income (loss) per share -
basic and diluted $(0.39) $(0.12)
Shares used in computing net loss
per share - basic and diluted 47,212 47,212
Nine Months Ended
September 30, 2006
Stock-
based Other Adjusted
Reported Comp Adjustments (1)
Revenues:
Product revenue (4) $45,509 $- $273 $45,782
Service revenue 16,366 - - 16,366
License fees and contract revenue (4) 11,276 - 555 11,831
Total revenues 73,151 - 828 73,979
Cost and Expenses:
Cost of product revenue (2),(4) 31,430 (373) 9 31,066
Cost of service revenue (2) 9,733 (111) - 9,622
Cost of license revenue (4) 73 - 54 127
Research and development (2),(5) 18,049 (723) (2,898) 14,428
Selling, general and administrative(2) 29,940 (2,870) - 27,070
Amortization of intangible assets (3) 4,528 - (4,528) -
Restructuring charges (3) 97 - (97) -
Total costs and expenses 93,850 (4,077) (7,460) 82,313
Operating loss (20,699) 4,077 8,288 (8,334)
Interest income, net 470 - - 470
Other income, net 379 - - 379
Provision for income taxes (197) - - (197)
Net income (loss) $(20,047) $4,077 $8,288 $(7,682)
Net income (loss) per share
- basic and diluted $(0.56) $(0.21)
Shares used in computing net loss per
share - basic and diluted 36,078 36,078
Notes to Adjusted Consolidated Statements of Operations
(1) To supplement the financial results presented on a GAAP basis, the
Company uses adjusted measures of revenues, gross profit margins,
costs and expenses, net loss and net loss per share which are
non-GAAP financial measures. Caliper's management uses these adjusted
financial measures to gain an understanding of its comparative
operating performance, and also in financial and operating decision-
making because management believes they better reflect the underlying
economics of Caliper's ongoing business. Management believes that
comparisons of adjusted financial measures may be more meaningful
because operating results presented under GAAP may include, from time
to time, items that management believes are not necessarily relevant
to understand Caliper's business. Caliper's management believes that
these adjusted financial measures provide useful information to
investors and others in understanding and evaluating Caliper's
current operating performance and future prospects. The adjusted
financial measures have limitations, however, because they do not
include all items of income and expense that impact Caliper's
operations. Caliper's management compensates for these limitations
when using the non-GAAP financial measures by always presenting GAAP
results with equal or greater prominence. The adjusted measures
exclude:
(a) Expense associated with the amortization of acquisition-related
intangible assets, impairment of acquired intangible assets and
in-process research and development. This exclusion allows
comparisons of operating results that are consistent over time for
both the Company's newly acquired and long-held business activities
and with both acquisitive and non-acquisitive peers.
(b) Deferred revenue adjustments recorded in purchase accounting that
reduce revenues that would otherwise be recognized on a continuing
GAAP basis.
(c) Restructuring expense-related to reductions in force and costs to
discontinue activities including idle capacity costs. The costs
largely relate to restructuring activities associated with business
combinations and are not indicative of the Company's normal
operating costs.
(d) Stock-based compensation that is recognized under Statement of
Financial Accounting Standards (SFAS) No. 123R which requires
non-cash stock compensation expense to be recorded when stock
options and other stock-related awards vest. Caliper's management
believes that available valuation methodologies and assumptions may
result in estimates that are misleading in the comparison of its
financial results to its peers, and do not provide meaningful
insight into Caliper's ongoing operations.
(2) Adjustment represents stock-based compensation expense.
(3) Adjustment represents intangible asset amortization and impairment
charges and restructuring activities related to business combinations.
(4) Adjustment represents revenues and related costs that were recorded at
fair value in accordance with the provisions of SFAS No. 141 and EITF
No. 01-03. As a result, these amounts were excluded from the reported
results on a GAAP basis; however, due to the fact they relate to
purchase accounting, they have been added back on an adjusted basis.
(5) Adjustment represents in-process research and development charge
related to Xenogen acquisition.
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