NEW YORK (GenomeWeb News) – Orchid Cellmark today reported a 6 percent year over year increase in revenues for the fourth quarter, spurred on by growth in the UK of more than 31 percent.
For the three months ended Dec. 31, total revenues increased to $16.6 million from $15.7 million a year ago. Service revenues, which comprised all of the company's revenues for the quarter, rose 11 percent from $14.9 million a year ago, and other revenues for the quarter declined to zero, compared to $850,000 a year ago.
The firm said that revenue growth resulted primarily from increased forensics testing service revenues in the UK, which partially offset a decrease in forensics casework in the US.
In a statement, Thomas Bologna, president and CEO of Orchid Cellmark, said that the forensics component of the UK business increased by about 40 percent year over year, driving overall growth in the UK.
That helped offset soft US business, which fell 11 percent year over year during the quarter. On a conference call following the release of the company's results, Bologna said that while paternity testing in the US grew "slightly" in the quarter, forensics testing fell 22 percent year over year.
"It is a very difficult business to predict in as much as one or two customers could make the difference for a given year," he said.
R&D spending by the Princeton, N.J.-based DNA testing services firm inched up to $263,000 from $255,000, a 3 percent increase. Its SG&A costs totaled $5.2 million during the quarter, up 13 percent from $4.6 million during Q4 2009.
For the fourth quarter, Orchid Cellmark saw a net loss of $237,000, or $.01 per share, compared to a profit of $858,000, or $.03 per share, a year ago.
For full-year 2010, total revenues rose to $63.7 million from $59.1 million a year ago, an 8 percent increase. Service revenues climbed 10 percent to $63.7 million from $58.1 million, while other revenues shrank to $27,000 from $985,000 a year ago.
Bologna said that the UK business was "particularly strong" in 2010 as revenues there grew more than 35 percent, offsetting softness in the US forensics business and paternity testing service. The US business declined about 17 percent in 2010.
He added that during the year, the company completed the consolidation of its US forensics business into its Dallas, Texas facility and its paternity business into its Dayton, Ohio facility, "which we expect will continue to favorably impact our US results" going forward.
The firm's R&D costs jumped 79 percent to $1.5 million from $834,000 in 2009, while SG&A spending climbed 4 percent to $20.1 million from $19.4 million.
Fro 2010, Orchid Cellmark's net loss tripled to $4.5 million, or $.15 per share, from $1.5 million, or $.05 per share, in 2009.
As of Dec. 31, the company had $8.1 million in cash and cash equivalents.
On the conference call, Bologna said that for first-quarter 2011, revenues are expected to increase "at least" 10 percent to 12 percent from first-quarter 2010 levels.
In early Thursday trading on the Nasdaq, shares of Orchid Cellmark were down almost 7 percent to $1.94.