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Transgenomic Q3 Revenues Slip 3 Percent on Lower Lab Services Sales

NEW YORK (GenomeWeb) – Transgenomic announced after the close of the market today a three percent drop in its third quarter revenues, reflecting lower sales from its contract laboratory services as it continues to refocus on its ICE-COLD PCR molecular diagnostic offerings.

"During the third quarter … we significantly advanced our ICE-COLD PCR commercialization strategy with the launch of multiple CLIA tests for cancer," such as the MX-ICP lung cancer panel, President and CEO Paul Kinnon said during a conference call following the release of the financial results. Additionally, "we signed our first commercial license for the use of ICE-COLD PCR-powered CLIA diagnostic tests and we continue to work with our pharma partners towards developing the scalable ICE-COLD PCR-based services business for the company."

During the quarter, the company also followed through on its goal of divesting non-strategic assets, Kinnon said.

In September, Transgenomic sold its ion chromatography assets to Edge BioSystems for about $2.1 million in cash. Later that month, it inked a deal to divest its Genetic Assays and Platforms business unit to Japanese biotech firm Adstec.

For the three-month period ended Sept. 30, the Omaha, Nebraska-based firm reported revenues of $4 million, down from $4.1 million in the same period the year before. Kinnon attributed the decline to $200,000 of lower contract laboratory services sales stemming from "a combination of seasonality filtrations in testing demand, as well as the transition from a focus on historical pharma services businesses to new ICE-COLD [PCR}-based pharma services." This decrease was partially offset by $100,000 in increased sales from patient-testing services.

Transgenomic's Q3 net loss from continuing operations jumped to $8.2 million, or $.62 per share, from $2.7 million, or $.41 per share, in the same period a year earlier. On a non-GAAP basis, the firm's net loss in the quarter was $1.3 million compared with $3.1 million in Q3 2014.

R&D spending the in quarter slipped to $561,000 from $641,000, while SG&A expenses fell to $3.1 million from $5.1 million.

Transgenomic finished the third quarter with cash and cash equivalents totaling $2.8 million. During Q3 the company completed a financing that raised approximately $2.7 million in net proceeds.