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Transgenomic Posts 12 Percent Q4 Revenue Decline

NEW YORK (GenomeWeb News) – Transgenomic reported after the close of the market Wednesday that its fourth quarter revenues fell 12 percent year over year.

The Omaha, Neb.-based molecular diagnostics firm reported total revenues of $6.2 million for the three months ended Dec. 31, compared to $7.2 million for the fourth quarter of 2012. Its laboratory services revenue dropped to $2.8 million from $4.8 million, while its diagnostics tools business saw revenues rise to $3.4 million from $2.5 million.

The firm posted a net loss of $4 million, or $.05 per share, for the quarter, compared to a net loss of $2.3 million, or $.03 per share, for Q4 2012.

Its R&D spending climbed 46 percent to $905,000 from $620,000, while its SG&A costs declined around 15 percent to $5.3 million from $6.2 million.

For full-year 2013 Transgenomic generated revenues of $27.5 million, down 13 percent from $31.5 million. Its lab services business saw sales drop to $15.4 million from $19.3 million, while its diagnostic tools business reported flat revenue growth at $12.2 million.

"The decline in 2013 is mainly attributable to decreased volume in the Laboratory Services segment, principally in the Neurology business, and an unfavorable shift in mix, as a surplus of higher-priced tests were reported in last year's fourth quarter following a production disruption," Transgenomic said in a statement. "This decline was partially offset by a significant increase in the Genetic Assays and Platforms segment, which resulted from an increase in unit sales of instruments in the US and in Europe."

The company's net loss for the year was $16 million, or $.19 per share, compared to $8.3 million, or $.13 per share, for FY 2012.

Transgenomic noted that income from warrant revaluation in 2013 was $1.9 million less than in 2012.

Its R&D spending increased to $3.2 million from $2.5 million year over year, while its SG&A expenses climbed to $25 million from $22 million.

Transgenomic finished the year with $1.6 million in cash and cash equivalents.

On a conference call following the release of the results, Transgenomic President and CEO Paul Kinnon noted that during the year the firm entered into partnerships with Amgen, MD Anderson Cancer Center, and a marketing and distribution deal with PerkinElmer, among other alliances inked in 2013.

"Each of these organizations brings us expertise and expanded market access for key products and product lines," Kinnon said.

The firm recently raised $7 million in gross proceeds from a convertible preferred stock placement.

Transgenomic also subsequent to the end of the year initiated a 1-for-12 reverse stock split and filed an application to list its common shares on the Nasdaq Capital Market. It currently trades on the OTC market and closed Wednesday down a fraction of 1 percent at $5.70.