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Life Technologies Posts $107M Q4 Loss on Merger Charges

NEW YORK (GenomeWeb News) – Life Technologies, the combined businesses of Invitrogen and Applied Biosystems following their November 2008 merger, today posted a fourth-quarter loss of $106.9 million due to a variety of charges associated with the deal.

Though the company's revenues fell short of analysts' expectations, the legacy Invitrogen business recorded organic revenue growth of 7 percent.

The Carlsbad, Calif.-based firm brought in total revenues of $540.6 million for the three-month period ended Dec. 31, compared to revenues of $336.4 million for Invitrogen alone in the 2007 fourth quarter. That tally fell short of analysts' consensus estimate of revenues of $572.6 million for the quarter.

However, what is not included in the fourth-quarter figures is the firm's mass spectrometry sales, which Life Technologies now accounts for as an equity investment. Including the mass spec sales of around $70 million for the last five weeks of Q4, the firm would have easily surpassed analysts' consensus estimates.

The firm said that ABI contributed $191 million in revenues for the five weeks during the fourth quarter of 2008 that it was part of Life Technologies. Organically, revenues for the legacy Invitrogen business grew 7 percent year over year.

In addition to the ABI revenue, the firm's BioDiscovery segment brought in revenues of $240.1 million for Q4 2008 — up .5 percent year over year including a negative affect from currency translation of 4.5 percent, while the Cell Systems segment had revenues of $113.7 million — up 17 percent year over year including a 4 percent benefit from currency translation.

Life Technologies' R&D spending for the quarter was $47.3 million, while its SG&A spending was $151.7 million. The company took charges of $74.4 million related to in-process R&D and charges of $22.6 million related to business consolidation costs.

As a result of the merger-related costs, Life Technologies posted a net loss of $106.9 million, or $.89 per share, compared to a profit of $41.1 million, or $.41 per share, for Invitrogen in the 2007 fourth quarter.

For full-year 2008, Life Technologies had revenues of $1.62 billion compared to revenues of $1.28 billion for Invitrogen in 2007. The BioDiscovery segment had FY 2008 revenues of $989.9 million, while Cell Systems contributed $443.7 million, and ABI contributed $191 million for the five weeks as part of the parent company.

Life Technologies' R&D costs for the year were $142.5 million, and its SG&A spending for the year was $499.3 million.

The firm posted a profit of $31.3 million, or $.29 per share, versus a profit of $143.2 million, or $1.34 per share, for Invitrogen for FY 2007.

Life Technologies finished the year with cash and investments of $448.3 million. The company also holds $3.5 billion in long-term debt, and company officials said during the call that repayment of debt was the top priority for use of its cash.

Life Technologies said that it expects to post low single-digit organic revenue growth for 2009, with an expected negative impact from currency translation of around 4 percent. It also predicted non-GAAP EPS of between $2.40 and $2.55.

In early trade on the Nasdaq, shares of Life Technologies were up 6 percent at $29.77.

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