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Tripos Posts Drop in Q4 Revenues as Profit Turns to Loss

NEW YORK, March 6 (GenomeWeb News) - Tripos today reported a 19.6-percent drop in fourth-quarter revenues as a small profit in the prior-year period fell to a net loss of $5.2 million.

 

Revenues fell to $13.9 million for the quarter ended Dec. 31, 2005, from $17.3 million in the comparable period of 2004.

 

The company attributed the fall-off to the winding down of a four-year, $90 million file enrichment project with Pfizer. The company disclosed in November that Pfizer would not renew the agreement.

 

Tripos reported a net loss for 2005 of $5.2 million, or $0.52 per diluted share, compared with a net income of $246,000, or $0.03 per diluted share, for the fourth quarter of 2004.

 

Quarterly R&D spending rose to $4.1 million from $1.9 million in the year-ago period.

 

The company finalized a reduction in force at its discovery research facilities in January, resulting in a charge that will be recorded in its financial results for the first quarter of 2006.

 

Tripos also said that it identified an error in its reported financial results for the periods ending March 31, June 30, and Sept. 30, 2005. The error was related to foreign currency gains and losses from intercompany transactions that should have been recorded as "other income and expense," but were instead recorded as "other comprehensive income" within the shareholders' equity section of the balance sheet.

 

As a result, restated net results rose for the first and third quarters of 2005, while second-quarter restated earnings took a hit.

 

The company did not provide an update on its plans for reevaluating its business options, which it disclosed in January.

 

"We are analyzing our resource requirements to ensure that we are operating at the optimum level to serve our current clients and new-business prospects. Our goal is to position the company for future growth and success," said CEO John McAlister in a statement.

 

As of Dec. 31, Tripos had $6.2 million in cash and cash equivalents.