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WaferGen Q4 Revenues Rise Sharply With Increased SmartChip Sales

NEW YORK (GenomeWeb) - WaferGen Biosystems reported after the close of the market Tuesday that its fourth quarter 2015 revenues rose significantly year over year, driven by a 53 percent increase in product revenue, mainly from sales of its existing SmartChip products.

The company said revenues for Q4 2015 were 2.4 million, an increase of 50 percent compared to $1.6 million in the fourth quarter of 2014. The company's product revenues grew 53 percent overall to $2.3 million from about $1.5 million a year ago, while license and royalty revenues were flat at 125,000.

The company's increased revenue mirrored increased sales of WaferGen's SmartChip products and services, and also included the first two sales of its new ICell8 Single-Cell System, which was launched last fall and is designed to isolate, identify, and process thousands of individual cells.

"While we are pleased to have completed these two sales, even more exciting are the results being generated with the system and the anecdotal feedback we are receiving from customers and researchers," WaferGen CEO Rollie Carlson said during a call discussing the company's earnings on Tuesday.

Early-access users of the product have included Genentech, Sweden's Karolinska Institutet, the University of Texas MD Anderson Cancer Center, and National Jewish Health, all of whom presented on their work with the new ICell8 system during the recent Advances in Genome Biology and Technology meeting.

Carlson said that feedback from these early users has been "highly encouraging" and their presentations at AGBT demonstrated the system's capacity for novel avenues of research, and contributed to the validation and differentiation of the platform in a rapidly growing single-cell genomics market.

At the same time, Carlson said, demand for WaferGen's earlier products remains strong. For example, the firm signed a supply agreement during the quarter with BloodCenter of Wisconsin to provide SmartChip solutions for high-throughput molecular antigen typing of blood donors.

Following the company's public offering last fall, Carlson said WaferGen is in a solid financial position as it moves into 2016.

The company's net loss in the fourth quarter was approximately $3.2 million, the company said, compared to $3.3 million in Q4 2014. Including an accretion charge of about $4.7 million related to preferred stock issued in the firm's October 2015 public offering, the net loss attributable to common stockholders for the quarter was about $7.9 million, or $0.57 per share, compared to $3.3 million, or $.58 per share, in Q4 2014.

The firm's R&D spending in the quarter rose approximately $175,000 to $2.1 million from close to $2 million in the year-ago quarter. SG&A costs remained declined slightly to $2.2 million from $2.3 million year over year.

For full year 2015, WaferGen reported total revenue of $7.2 million, up from $6.0 million in 2014, but short of its initial guidance of $7.8 million to $8.2 million for the year. Product revenues were responsible for most of this increase, rising to $6.7 million from $5.5 million in 2014, while license and royalty revenues remained flat at $500,000.

According Carlson, the shortfall in revenue relative to WaferGen's initial 2015 guidance was due to a change in the timing of certain revenues. With those revenues now expected in 2016, the difference has been included in the company's guidance for FY 2016 of between $12 million and $13 million.

WaferGen's net loss for the year rose to $15.3 million from $10.7 million the previous year. Taking into account the accretion charge related to the company's October 2015 public offering, the net loss attributable to common stockholders for the year was approximately $20 million, or $2.58 per share, compared $10.7 million, or $4.17 per share, in 2014.

The firm's full-year R&D spending rose to $9.6 million from $6.7 million in 2014, primarily as a result of increased activity related to the development and commercialization of its new single-cell products. The firm's SG&A costs rose to $9.8 million from $9.2 million.

WaferGen exited 2015 with $15.2 million in cash and cash equivalents.

In Wednesday morning trade on the Nasdaq, shares of WaferGen were down around 7 percent at $.69.

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