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Affymetrix to Lay off 100 in Restructuring; Reports Preliminary Q4 Revenue of $84M

NEW YORK (GenomeWeb News) — Affymetrix on Tuesday said that it plans to lay off more than 100 employees, or around 8 percent of its workforce, in a restructuring effort expected to save the firm around $25 million on an annualized basis.

The company also reported preliminary fourth-quarter 2012 revenue of $84 million, in line with consensus analyst estimates. Total revenue included $18 million from its eBioscience business unit, which it acquired for $315 million last year.

Excluding eBioscience, Affy's fourth-quarter revenue increased by 1 percent over the prior-year period. Revenue for the eBioscience unit increased by around 5 percent compared to the fourth quarter of 2011, the company said.

For fiscal 2012, the company expects total revenue of approximately $295 million, a 10 percent increase over $267.5 million in full-year 2011 revenue.

The company said that it has also prepaid $9.6 million of its senior-secured debt, which represents the entire principal due in 2013. The company's senior debt is now $73 million and its cash-on-hand at the end of 2012 was around $35 million.

Affy expects to record a charge of around $7 million for the restructuring, which is expected to be complete by the end of the first quarter. The majority of the charge will be incurred during the quarter.

The restructuring is expected to help free up cash flow and help the company accelerate the repayment of its debt. It "will drive operational efficiency, and together with the sharpened focus of our development and commercial priorities, will accelerate our return to profitability," Frank Witney, president and CEO, said in a statement.

In line with the reorganization, John Runkel, the company's executive vice president and general counsel, will retire effective March 31. He will be succeeded by Siang Chin, who is currently vice president and chief corporate counsel.

Tim Barabe, executive vice president and CFO, will also retire, though he will continue in his current role while the company searches for a successor.