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Transgenomic Posts Drop in Q1 Revenue, Widened Losses

NEW YORK, May 11 (GenomeWeb News) - Transgenomic today reported a drop in first-quarter earnings, accompanied by widening net losses and reduced R&D spending.

Transgenomic's revenues for the quarter ended March 31, 2004, were $8.6 million, down 9 percent from $9.5 million in the first quarter of 2004. CEO Collin D'Silva said that revenue from sales of bioconsumables during the quarter increased 35 percent year-over-year.

The net loss for the quarter was $3.9 million, or $.13 per share, and included a non-cash finance charge of $503,000. This compares to a net loss of $3.6 million, or $.15 per share, for the first quarter of 2003, which included a goodwill impairment charge of $4.8 million.

The company cited its Boulder, Colo.-based specialty oligonucleotide manufacturing facility, which generated $679,000 in revenues and incurred $1.5 million of manufacturing expenses during the quarter, as having a particularly negative impact on its bottom line.

Transgenomic's R&D spending was $1.9 million during the first quarter of 2004, down from $2.3 million in the prior-year period.

The company shored up its cash position by $1.3 million during the quarter, which it closed with $2.5 million of cash, cash equivalents, and short-term investments on hand. As of Dec. 31, 2003, Transgenomic had $1.2 million in cash, cash equivalents, and short-term investments.

Mitch Murphy, Transgenomic's Interim CFO, predicted revenues in the range of $9.0 to $9.5 million for the second quarter of 2004, adding, "we continue to monitor our expenses and will look for opportunities to continue to achieve incremental reductions."

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