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Cepheid's Q4 Revenues Flat as Firm Awaits New Grumman, USPS Alliance

NEW YORK (GenomeWeb News) — Cepheid today said fourth-quarter revenues were flat as R&D spending rose 30 percent and net loss surged 156 percent.
Total receipts for the three months ended Dec. 31, 2006, decreased to $23.6 million from $23.7 million year over year.
Cepheid said its instrument sales increased 8.5 percent to $6.8 million; reagent and disposable sales dipped 7.4 percent to $14.7 million; contract revenue increased 93 percent to $1.6 million, and revenue from grants and government funding dropped 38 percent to $341,000.    
Breaking out its products sales for the quarter, the company said clinical products sales were up 81 percent to $6.2 million; industrial products sales increased 5 percent to $3.8 million; and biothreat product sales were down 24 percent to $11.6 million.
The wilting biothreat sales were expected, Cepheid said, because the company fulfilled a US Postal Service contract for the GeneXpert technology at the end of last year.
Cepheid added that it is “currently in discussion with Northrop Grumman and the USPS to potentially develop a five-year anthrax test cartridge purchasing agreement.”
Fourth-quarter R&D spending increased to $6.7 million from $5.2 million year over year, Cepheid said.
The company reported that net losses increased to $8.3 million from $5.1 million in the year-ago period.
Cepheid said the widened loss includes a $3.4-million payment as part of a licensing agreement with Idaho Technology to settle a PCR technology patent lawsuit.  
Cepheid said it had around $17.2 million in cash and equivalents and $77.8 million in marketable securities as of Dec. 30.
CEO John Bishop said the company expects product sales to “increase significantly in the second half of the year.”
The company expects total revenues in 2007 to increase by between 28 percent and 37 percent to between $112 million and $120 million, largely coming from product sales of between $100 million and $120 million.

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