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Transgenomic Sees Q4 Revenues Decline, Negotiates $2.75M Convertible Note

NEW YORK, Feb. 24 (GenomeWeb News) - Transgenomic today reported a 7 percent drop in fourth-quarter revenues year over year, coupled with narrowed net losses, lower R&D spending, and dwindling cash reserves.

The company's revenues for the fourth quarter ended Dec. 31, 2003, were $8.5 million, down from $9.2 million in the year-ago period.

Transgenomic's net loss for the quarter, including a goodwill impairment charge of $4.8 million, was $8.5 million, or $.32 per share. This was down from a net loss of $9.3 million, or $.40 per share, in the fourth quarter of 2002, which included restructuring charges of $3.3 million.

Transgenomic spent $2.2 million on R&D during the quarter, down 33 percent from $3.3 million in the fourth quarter of 2002.

The company had $1.2 million in cash, cash equivalents, and short-term investments as of Dec. 31, 2003, compared to $13.3 million at the close of 2002.

CFO Michael Draper said that the company has abandoned its previous plans to improve its liquidity position, which involved a sale-and-leaseback transaction related to its Glasgow, Scotland, manufacturing facility. Instead, the company will broaden a $7.5 million credit facility it established with Laurus Master Fund in December to include a three-year, $2.75 million convertible note. Draper said the arrangement "is preferable to the sale and leaseback options available" and "will be adequate to support our operations," based on current projections.

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