WaferGen Bio-systems Announces Third Quarter 2014 Results
Solid Execution Across SmartChip and Apollo Product Lines
Appointment of Chief Operating Officer and Chief Financial Officer
Completion of $20 million offering of Common Stock and Warrants
FREMONT, Calif., Nov. 7, 2014 /PRNewswire/ -- WaferGen Bio-systems, Inc. (NASDAQ: WGBS) announced today its financial results for the third quarter ended September 30, 2014.
Key Highlights
- Revenue for the third quarter of 2014 was $1.3 million, up 221% versus the third quarter of 2013. Product sales for the third quarter 2014 increased to $1.1 million, up 325% versus the prior year period
- Net loss for the third quarter of 2014 was $2.8 million, compared to a net loss of $10.8 million in the third quarter of 2013
- Appointment of Keith Warner as Chief Operating Officer and Michael P. Henighan as Chief Financial Officer, adding seasoned executives to senior management team
- WaferGen completed a public offering consisting of common stock and warrants that raised gross proceeds of $20.0 million
- Cash balance at September 30, 2014 of $17.3 million
Total revenue for the third quarter of 2014 was $1.3 million, up 221% from $389,000 in the third quarter of 2013. The increase is primarily due to revenue from the Apollo 324TM library prep products acquired in early 2014, which accounted for 46% of our product revenue in the third quarter of 2014. Revenues increased significantly in the third quarter 2014 year-over-year in sales of our Real-Time PCR Chip panels, which represented 24% of this quarter's product revenue. Sales also increased of our SmartChip Real-Time PCR Systems and SmartChip Target Enrichment Systems (launched in mid-2013), in the third quarter of 2014 versus the prior year period, which represented 23% of our product revenue in the three months.
Operating loss for the third quarter of 2014 was $3.1 million, compared to $3.2 million in the prior year period. The increase in revenue of $0.9 million resulted in an increase in gross profit of $0.7 million. This improvement was mostly offset by a $0.6 million increase in operating expenses.
Net loss for the third quarter of 2014 was $2.8 million, compared to a net loss of $10.8 million in the third quarter of 2013. The lower net loss was primarily due to a reduction in non-operating expenses of $7.9 million, mainly due to the absence of $7.5 million in non-cash charges related to capital restructuring in 2013.
"I am optimistic about the future of WaferGen," said Ivan Trifunovich, President and Chief Executive Officer. "The completion of our common stock offering in August provides the Company with the resources to grow our existing business and to fund our critical innovations in molecular diagnostics products for the future. Moreover, I am excited about Keith Warner and Michael Henighan joining WaferGen. They are already making valuable contributions to the Company. Their experience and proven track records significantly increase the depth and breadth of our management team as we continue to grow WaferGen's business in offering Next-Gen Sequencing solutions in clinical research, testing and diagnostics."
2014 Guidance
Our revenue guidance for the full year is in excess of $6 million for 2014, unchanged from our prior guidance.
Investor Conference Call
As previously announced, management will host a conference call to discuss its financial results for the quarter ended September 30, 2014, today at 11:00 am ET, 8:00 am PT. Interested parties may listen to the live broadcast by calling (877) 407-3982 for domestic participants and (201) 493-6780 for international participants.
A replay of the conference call will be available beginning at 2:00 p.m. ET on November 7, 2014 and ending at 11:59 p.m. ET on November 21, 2014 by dialing (877) 870-5176 (U.S.) or (858) 384-5517 (international), Conference ID Number: 13593721.
About WaferGen
WaferGen Bio-systems, Inc. is a life science company that offers innovative genomic solutions for clinical testing and research. The SmartChip MyDesignTM Real-Time PCR System is a high-throughput genetic analysis platform for profiling and validating molecular biomarkers via microRNA and mRNA gene expression profiling, as well as single nucleotide polymorphism (SNP) genotyping. The SmartChip TETM System is a novel product offering for target enrichment geared towards clinical Next-Gen sequencing (NGS). The Company also offers the Apollo 324TM product line used in library preparation for NGS. These three complementary technologies offer a powerful set of tools enabling more accurate, faster and cheaper genetic analysis based on Next-Gen Sequencing and Real-Time PCR.
For additional information, please see http://www.wafergen.com.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended that are intended to be covered by the "safe harbor" created by those sections. Forward-looking statements, which are based on certain assumptions and describe our future plans, strategies and expectations, can generally be identified by the use of forward-looking terms such as "believe," "expect," "may," "will," "should," "could," "seek," "intend," "plan," "estimate," "anticipate" or other comparable terms. Forward-looking statements may address the following subjects among others: statements regarding the sufficiency of our capital resources, expected operating losses, expected revenues, expected expenses, expected cash usage and our expectations concerning our competitive position and business strategy. Forward-looking statements involve inherent risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements, as a result of various factors including those risks and uncertainties described in the Risk Factors and in Management's Discussion and Analysis of Financial Condition and Results of Operations sections of our most recently filed Annual Report on Form 10-K and our subsequently filed Quarterly Reports on Form 10-Q. We urge you to consider those risks and uncertainties in evaluating our forward-looking statements. We caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Except as otherwise required by the federal securities laws, we disclaim any obligation or undertaking to publicly release any updates or revisions to any forward-looking statement contained herein (or elsewhere) to reflect any change in our expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
Investor Contacts:
ICR, Inc.
Bob Yedid
[email protected]
646-277-1250
WaferGen Bio-systems, Inc.
Ivan Trifunovich
[email protected]
(510) 651-4450
| WAFERGEN BIO-SYSTEMS, INC. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (Unaudited) |
|||||||||||||
| Three Months Ended September 30, |
Nine Months Ended September 30, |
||||||||||||
| 2014 |
2013 |
2014 |
2013 |
||||||||||
| Revenue: |
|||||||||||||
| Product |
$ |
1,125,201 |
$ |
264,547 |
$ |
4,014,622 |
$ |
480,949 |
|||||
| License and royalty |
125,000 |
125,000 |
375,000 |
333,333 |
|||||||||
| Total revenue |
1,250,201 |
389,547 |
4,389,622 |
814,282 |
|||||||||
| Cost of product revenue |
374,776 |
192,814 |
1,739,757 |
335,182 |
|||||||||
| Gross profit |
875,425 |
196,733 |
2,649,865 |
479,100 |
|||||||||
| Operating expenses: |
|||||||||||||
| Sales and marketing |
961,891 |
625,390 |
3,598,880 |
1,577,317 |
|||||||||
| Research and development |
1,909,310 |
1,581,449 |
4,749,193 |
4,246,796 |
|||||||||
| General and administrative |
1,132,418 |
1,217,899 |
3,233,461 |
2,443,317 |
|||||||||
| Total operating expenses |
4,003,619 |
3,424,738 |
11,581,534 |
8,267,430 |
|||||||||
| Operating loss |
(3,128,194) |
(3,228,005) |
(8,931,669) |
(7,788,330) |
|||||||||
| Other income and (expenses): |
|||||||||||||
| Interest income |
19 |
830 |
46 |
2,917 |
|||||||||
| Interest expense |
(107,464) |
(848,464) |
(319,946) |
(2,821,093) |
|||||||||
| Gain on revaluation of derivative liabilities, net |
589,336 |
623,613 |
1,963,532 |
145,133 |
|||||||||
| Loss on extinguishment of debt |
(128,546) |
(4,970,410) |
(128,546) |
(4,970,410) |
|||||||||
| Issuance of warrants due to organic change |
— |
(2,553,318) |
— |
(2,553,318) |
|||||||||
| Miscellaneous income (expense) |
(5,686) |
167,952 |
(9,879) |
235,295 |
|||||||||
| Total other income and (expenses) |
347,659 |
(7,579,797) |
1,505,207 |
(9,961,476) |
|||||||||
| Net loss before provision for income taxes |
(2,780,535) |
(10,807,802) |
(7,426,462) |
(17,749,806) |
|||||||||
| Provision for income taxes |
— |
530 |
3,100 |
3,191 |
|||||||||
| Net loss |
(2,780,535) |
(10,808,332) |
(7,429,562) |
(17,752,997) |
|||||||||
| Accretion on Series 1 Convertible Preferred Stock associated with beneficial conversion feature |
— |
(898,623) |
— |
(898,623) |
|||||||||
| Accretion on Series A and B convertible preference shares of subsidiary associated with premium |
— |
(408,651) |
— |
(2,898,550) |
|||||||||
| Series A-1 preferred dividend |
— |
(131,219) |
— |
(547,171) |
|||||||||
| Net loss attributable to common stockholders |
$ |
(2,780,535) |
$ |
(12,246,825) |
$ |
(7,429,562) |
$ |
(22,097,341) |
|||||
| Net loss per share – basic and diluted |
$ |
(1.02) |
$ |
(43.51) |
$ |
(4.87) |
$ |
(180.16) |
|||||
| Shares used to compute net loss per share – basic and diluted |
2,727,810 |
281,466 |
1,526,963 |
122,657 |
|||||||||
| WAFERGEN BIO-SYSTEMS, INC. AND SUBSIDIARIES Condensed Consolidated Balance Sheets |
|||||||
| September 30, 2014 |
December 31, 2013 |
||||||
| Assets |
(Unaudited) |
||||||
| Current assets: |
|||||||
| Cash and cash equivalents |
$ |
17,328,471 |
$ |
10,708,646 |
|||
| Accounts receivable |
1,754,437 |
367,266 |
|||||
| Inventories |
953,336 |
292,650 |
|||||
| Prepaid expenses and other current assets |
528,991 |
350,540 |
|||||
| Total current assets |
20,565,235 |
11,719,102 |
|||||
| Property and equipment, net |
387,984 |
269,618 |
|||||
| Goodwill |
990,000 |
— |
|||||
| Intangible assets, net |
1,486,600 |
— |
|||||
| Other assets |
79,898 |
42,209 |
|||||
| Total assets |
$ |
23,509,717 |
$ |
12,030,929 |
|||
| Liabilities and Stockholders' Equity (Deficit) |
|||||||
| Current liabilities: |
|||||||
| Accounts payable |
$ |
1,897,688 |
$ |
980,887 |
|||
| Accrued payroll and related costs |
939,112 |
289,053 |
|||||
| Other current liabilities |
747,703 |
1,143,335 |
|||||
| Total current liabilities |
3,584,503 |
2,413,275 |
|||||
| Long-term debt, net of discount |
1,913,256 |
1,683,942 |
|||||
| Derivative liabilities |
362,836 |
9,147,507 |
|||||
| Other liabilities |
564,379 |
— |
|||||
| Total liabilities |
6,424,974 |
13,244,724 |
|||||
| Stockholders' equity (deficit): |
|||||||
| Preferred Stock |
— |
13,595,662 |
|||||
| Common Stock |
105,352,474 |
66,028,712 |
|||||
| Accumulated deficit |
(88,267,731) |
(80,838,169) |
|||||
| Total stockholders' equity (deficit) |
17,084,743 |
(1,213,795) |
|||||
| Total liabilities and stockholders' equity (deficit) |
$ |
23,509,717 |
$ |
12,030,929 |
|||
SOURCE WaferGen Bio-systems, Inc.
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