GAITHERSBURG, Md., June 14 /PRNewswire-FirstCall/ -- BioVeris
Corporation (NASDAQ:BIOV) reported today its financial results for
the quarter and year ended March 31, 2006 and filed its Annual
Report on Form 10-K with the Securities and Exchange Commission.
BioVeris adopted FASB Interpretation No. 46, "Consolidation of
Variable Interest Entities" (FIN 46), as of March 31, 2004 based on
a determination that Meso Scale Diagnostics, LLC. (MSD) qualified
as a variable interest entity with the Company as the primary
beneficiary. Accordingly, beginning as of March 31, 2004, the
Company consolidated the financial information of MSD in its
financial statements. In August 2004, the Company and MSD entered
into a settlement agreement that resolved litigation between the
parties and constituted a reconsideration event under FIN 46. The
Company has determined that it no longer meets the conditions to be
designated as the primary beneficiary of MSD, as certain provisions
of the settlement agreement reallocated the obligation to absorb
the majority of MSD's future expected losses. Accordingly,
beginning August 12, 2004, the Company deconsolidated the financial
results of MSD. The statement of operations for the year ended
March 31, 2005 includes the consolidated revenue and expenses of
MSD for the period from April 1, 2004 through August 12, 2004, and
the year ended March 31, 2006 includes only the financial results
of BioVeris and its wholly-owned subsidiaries. BioVeris recorded
revenues of $20.6 million for the fiscal year ended March 31, 2006,
compared to $26.3 million for the last fiscal year. Of this $5.7
million decrease, $4.3 million represents MSD revenues which were
consolidated with BioVeris' revenues during fiscal 2005. Revenues
for the three months ended March 31, 2006 were $4.1 million,
compared to $4.9 million for the same period in 2005. Revenues
include product sales of $3.6 million and $19.1 million during the
three months and year ended March 31, 2006, respectively, compared
to $4.6 million and $24.7 million for the same respective prior
year periods. Of the $5.6 million decrease in fiscal year 2006,
$4.0 million represents MSD product sales. BioVeris' sales of
biosecurity products for fiscal 2006 were $8.6 million, a decrease
of $800,000 from the prior year. Sales of products for the life
science market were $10.5 million for fiscal 2006, a decrease of
$800,000 from the prior year. These changes in product sales
reflect the change of orders and product deliveries for biosecurity
and life science products, which are based on customers'
requirements. Product costs were $2.1 million (57% of total product
sales) for the three months ended March 31, 2006 compared to $2.2
million (47% of total product sales) in the corresponding prior
year period. Product costs were $8.7 million (46% of total product
sales) for the year ended March 31, 2006 compared to $12.9 million
(52% of total product sales) in the corresponding prior year
period. The current year decrease of $4.2 million consists of $3.7
million due to the consolidation of MSD's product costs, and a
$500,000 reduction in Bioveris' costs. BioVeris' product costs in
fiscal 2006, as a percentage of total product sales, were 46%
compared to 44% in fiscal 2005. Research and development expenses
increased to $4.6 million for the three months ended March 31, 2006
from $4.3 million for the corresponding prior year period. Research
and development expenses decreased to $17.7 million for the year
ended March 31, 2006 from $21.5 million for the corresponding prior
year period. The $3.8 million decrease in fiscal 2006 consists of
$3.7 million due to the consolidation of MSD's research and
development expenses, and a $100,000 reduction in BioVeris' costs.
Research and development expenses primarily relate to ongoing
development costs and product enhancements associated with
vaccines, the M-SERIES family of products, development of new
assays and research and development of new systems and
technologies, including point-of-care products. Selling, general
and administrative expenses were $5.9 million for the three months
ended March 31, 2006 compared to $6.5 million in the corresponding
prior year period. Selling, general and administrative expenses
were $24.7 million for the year ended March 31, 2006 compared to
$32.2 million in the corresponding prior year period. The $7.5
million decrease in fiscal 2006 consists of $4.5 million due to the
consolidation of MSD's selling, general and administrative
expenses, and a $3.0 million reduction in BioVeris' costs.
BioVeris' decrease in selling, general and administrative costs was
primarily attributable to lower professional fees in the current
year. BioVeris' net loss for the three months ended March 31, 2006
was $7.2 million ($0.27 per common share), compared to a net loss
of $7.1 million ($0.27 per common share) in the corresponding prior
year period. BioVeris' net loss for the year ended March 31, 2006
was $27.9 million ($1.04 per common share), compared to a net loss
of $77.6 million ($2.90 per common share) in the corresponding
prior year period. At March 31, 2006, the Company had cash, cash
equivalents and short-term investments of $69.6 million. BioVeris
Corporation is a global integrated health care company developing
proprietary technologies in diagnostics and vaccinology. The
Company is dedicated to the development and commercialization of
innovative products and services for healthcare providers, their
patients and their communities. BioVeris is headquartered in
Gaithersburg, Maryland. More information about the Company can be
found at http://www.bioveris.com/. This press release contains
forward-looking statements within the meaning of the federal
securities laws that relate to future events or BioVeris' future
financial performance. All statements in this press release that
are not historical facts, including any statements about
consolidation of future financial information and future financial
or operational plans are hereby identified as "forward-looking
statements." The words "may," "should," "will," "expect," "could,"
"anticipate," "believe," "estimate," "plan," "intend" and similar
expressions have been used to identify certain of the
forward-looking statements. In this press release, BioVeris has
based these forward-looking statements on management's current
expectations, estimates and projections and they are subject to a
number of risks, uncertainties and assumptions that could cause
actual results to differ materially from those described in the
forward-looking statements. Such forward-looking statements should,
therefore, be considered in light of various important factors,
including changes in BioVeris' strategy and business plans;
BioVeris' ability to develop and introduce new or enhanced
products; BioVeris' ability to enter into new collaborations on
favorable terms, if at all; and changes in general economic,
business and industry conditions. The foregoing sets forth some,
but not all, of the factors that could impact upon BioVeris'
ability to achieve results described in any forward-looking
statements. A more complete description of the risks applicable to
BioVeris is provided in the Company's filings with the SEC
available at the SEC's web site at http://www.sec.gov/. Investors
are cautioned not to place undue reliance on these forward-looking
statements. Investors also should understand that it is not
possible to predict or identify all risk factors and that neither
this list nor the factors identified in BioVeris' SEC filings
should be considered a complete statement of all potential risks
and uncertainties. BioVeris has no obligation to publicly update or
release any revisions to these forward- looking statements to
reflect events or circumstances after the date of this press
release. (Financial data follows.) BioVeris Corporation
Consolidated Statement of Operations (In thousands, except per
share data) (Unaudited) Three Months Ended Twelve Months Ended
March 31, March 31, 2006 2005 2006 2005 REVENUES: Product sales
$3,634 $4,618 $19,054 $24,662 Royalty income 477 286 1,561 1,249
Contract fees - - - 388 Total 4,111 4,904 20,615 26,299 OPERATING
COSTS AND EXPENSES: Product costs 2,081 2,159 8,706 12,860 Research
and development 4,559 4,290 17,695 21,485 Selling, general, and
administrative 5,872 6,494 24,688 32,212 Total 12,512 12,943 51,089
66,557 LOSS FROM OPERATIONS (8,401) (8,039) (30,474) (40,258)
INTEREST INCOME 1,167 997 3,851 3,191 OTHER, NET 62 (385) (1,230)
95 LOSS ON JOINT VENTURE IMPAIRMENTS - 2,033 - (35,077) EQUITY IN
LOSS OF JOINT VENTURE - (1,736) - (5,524) NET LOSS $(7,172)
$(7,130) $(27,853) $(77,573) Net loss per common share (basic and
diluted) $(0.27) $(0.27) $(1.04) $(2.90) COMMON SHARES OUTSTANDING
(basic and diluted) 26,862 26,728 26,810 26,728 BioVeris
Corporation Consolidated Balance Sheets (In thousands, except share
data) (Unaudited) March 31, 2006 2005 ASSETS CURRENT ASSETS: Cash
and cash equivalents $29,693 $41,739 Short-term investments 39,938
53,890 Accounts receivable, net 3,360 4,483 Inventory 5,429 5,235
Other current assets 2,508 2,813 Total current assets 80,928
108,160 Equipment and leasehold improvements, net 3,456 3,636 OTHER
NONCURRENT ASSETS: Note receivable 5,666 4,709 Technology licenses
15,356 17,306 Other 447 354 TOTAL ASSETS $105,853 $134,165
LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts
payable and accrued expenses $5,362 $6,457 Accrued wages and
benefits 1,862 1,713 Other current liabilities 1,520 1,351 Total
current liabilities 8,744 9,521 NONCURRENT DEFERRED LIABILITIES 546
1,890 Total liabilities 9,290 11,411 COMMITMENTS (see Note 6) and
CONTINGENCIES MINORITY INTEREST - - SERIES B PREFERRED STOCK, 1,000
shares designated, issued and outstanding 7,500 7,500 STOCKHOLDERS'
EQUITY: Preferred stock, par value $0.01 per share, 15,000,000
shares authorized, issuable in series: Series A, 600,000 shares
designated, none issued - - Common stock, par value $0.001 per
share, 100,000,000 shares authorized, 27,238,000 and 26,728,000
shares issued and outstanding 27 27 Additional paid-in capital
205,997 203,464 Deferred compensation (1,688) - Accumulated other
comprehensive loss (128) (999) Accumulated deficit (115,145)
(87,238) Total stockholders' equity 89,063 115,254 TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY $105,853 $134,165 BioVeris
Corporation Supplemental Consolidated Statement of Operations (In
thousands, except per share data) (Unaudited) Year Ended March 31,
2006 Year Ended March 31, 2005 BioVeris and BioVeris and
Wholly-Owned Wholly-Owned Consolidating Subsidiaries Subsidiaries
MSD Eliminations Consolidated (In thousands, except per share data)
Revenues: Product sales $19,054 $20,703 $3,959 $- $24,662 Royalty
income 1,561 1,249 - - 1,249 Contract fees 32 356 - 388 Total
20,615 21,984 4,315 - 26,299 Operating costs and expenses: Product
costs 8,706 9,167 3,693 - 12,860 Research and development 17,695
17,877 3,705 (97) 21,485 Selling, general and administrative 24,688
27,710 4,502 - 32,212 Total operating costs and expenses 51,089
54,754 11,900 (97) 66,557 Loss from operations (30,474) (32,770)
(7,585) 97 (40,258) Interest income 3,851 3,111 80 - 3,191 Other,
net (1,230) 95 - - 95 Loss on joint venture impairments - (35,077)
- - (35,077) Equity in loss of joint venture - (12,932) - 7,408
(5,524) Net loss $(27,853) $(77,573) $(7,505) $7,505 $(77,573) Net
loss per common share (basic and diluted) $(1.04) $(2.90) $(0.28)
$0.28 $(2.90) Shares used in computing net loss per common share
26,810 26,728 26,728 26,728 26,728 DATASOURCE: BioVeris Corporation
CONTACT: George Migausky of BioVeris Corporation, +1-301-869-9800,
ext. 2013; investors: Jonathan Fassberg of The Trout Group,
+1-212-477-9007, ext. 16, for BioVeris Corporation; media: Paul
Caminiti or Andrew Cole of Citigate Sard Verbinnen,
+1-212-687-8080, for BioVeris Corporation Web site:
http://www.bioveris.com/
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