BURLINGTON, N.C., Nov. 8 /PRNewswire-FirstCall/ -- TriPath Imaging,
Inc. (NASDAQ:TPTH) today reported third quarter revenues of nearly
$26.0 million, a 21% increase from the third quarter of 2005, gross
profit of $17.6 million, a 16% increase from the third quarter of
2005, and net income of $68,000 or $0.00 per diluted share. During
the third quarter of 2006, the Company incurred transaction-related
expenses of approximately $1.8 million, or approximately $0.05 per
diluted share, in connection with the process that culminated in
the proposed acquisition of TriPath Imaging by BD (Becton,
Dickinson and Company) (NYSE:BDX). In addition, for the three
months ended September 30, 2006, the stock-based compensation
expense recorded in accordance with SFAS 123( R ) totaled $328,000
or approximately $0.01 per diluted share. On September 8, 2006, the
Company signed a definitive merger agreement with BD, pursuant to
which BD agreed to acquire the approximately 93.5% of the
outstanding shares of TriPath Imaging, Inc. that BD does not
currently own. The agreement provides that BD will pay $9.25 in
cash for each share of TriPath Imaging common stock, and provides
for the cash-out of all existing options and stock appreciation
rights based on the same per share consideration. The antitrust
waiting period under the Hart-Scott Rodino Act for the proposed
acquisition was terminated on October 26, 2006. The closing of the
transaction remains subject to customary conditions, including
approval of TriPath Imaging's stockholders. The special meeting of
stockholders of TriPath Imaging to consider and vote on the
adoption of the merger agreement is scheduled for December 19,
2006. In the first nine months of 2006, revenues were $74.5
million, a 20% increase from the same period in 2005, gross profit
was $50.9 million, a 17% increase from the same period in 2005, and
net income was $3.4 million or $0.09 per diluted share. During the
first nine months of 2006, the Company incurred transaction-related
expenses of approximately $2.2 million, or approximately $0.06 per
diluted share, in connection with the process that culminated in
the proposed acquisition of TriPath Imaging by BD. In addition, for
the nine months ended September 30, 2006, the stock-based
compensation expense recorded in accordance with SFAS 123(R)
totaled $742,000 or approximately $0.02 per diluted share. Cash and
cash equivalents at March 31, 2006 were $27.5 million. In the third
quarter of 2006, the Company generated positive cash flow for the
ninth consecutive quarter. The Company filed its Quarterly Report
on Form 10-Q with the Security and Exchange Commission today. In
light of the pending transaction with BD, the Company will not be
hosting a conference call to review its third quarter results. Paul
R. Sohmer, M.D., Chairman, President and CEO of TriPath Imaging,
Inc. commented, "We are very pleased with our performance to date
and look forward to bringing our transaction with BD to closure."
TriPath Imaging, Inc., headquartered in Burlington, North Carolina,
develops, manufactures, markets and sells innovative solutions to
improve the clinical management of cancer, including detection,
diagnosis, staging and treatment. TriPath Oncology, a wholly owned
subsidiary of TriPath Imaging, develops molecular diagnostic
products for malignant melanoma and cancers of the cervix, breast,
ovary and prostate. IMPORTANT ADDITIONAL INFORMATION FILED WITH THE
SEC TriPath Imaging filed a Definitive Proxy Statement with the
Securities and Exchange Commission ("SEC") on October 31, 2006 in
connection with the proposed merger with BD. The Definitive Proxy
Statement was mailed to TriPath Imaging's stockholders on or about
November 1, 2006. The Definitive Proxy Statement contains important
information about BD, TriPath Imaging, the transaction and related
matters. Investors and security holders are urged to read the
Definitive Proxy Statement carefully. Investors and security
holders may obtain free copies of the Definitive Proxy Statement
and other documents filed with the SEC by BD and TriPath Imaging
through the web site maintained by the SEC at http://www.sec.gov/.
In addition, investors and security holders may obtain free copies
of the Definitive Proxy Statement from TriPath Imaging by
contacting TriPath Imaging, Inc., Investor Relations, 780
Plantation Drive, Burlington, NC 27215. TriPath Imaging and its
directors and executive officers may be deemed to be participants
in the solicitation of proxies in respect of the transactions
contemplated by the merger agreement. Information regarding TriPath
Imaging's directors and executive officers is contained in the
Definitive Proxy Statement filed with the SEC on October 31, 2006.
As of October 9, 2006, TriPath Imaging's directors and executive
officers beneficially owned approximately 2,099,959 shares, or
5.4%, of TriPath Imaging's common stock. SAFE HARBOR FOR
FORWARD-LOOKING STATEMENTS Investors are cautioned that statements
in this press release that are not strictly historical statements
constitute forward-looking statements which involve risks and
uncertainties that could cause actual results and outcomes to
differ materially from what is expressed in those forward-looking
statements. Such forward-looking statements include, without
limitation, those related to the anticipated timetable for
completing the proposed merger with BD. Important factors that may
affect TriPath Imaging's operating results include, without
limitation: the need for TriPath Imaging stockholder approval of
the proposed merger with BD; the ability to consummate the
transaction; and other risks detailed in TriPath Imaging's filings
with the Securities and Exchange Commission, including those
described in TriPath Imaging's Annual Report on Form 10-K for the
year ended December 31, 2005 and its most recent Quarterly Report
on Form 10-Q. Contact Stephen P. Hall Chief Financial Officer
336-290-8721 TriPath Imaging, Inc. Condensed Consolidated
Statements of Income (In thousands, except per share data)
(Unaudited) Three months ended Nine months ended September 30,
September 30, 2006 2005 2006 2005 Revenues $25,998 $21,525 $74,500
$62,105 Cost of revenues 8,417 6,349 23,604 18,642 Gross profit
17,581 15,176 50,896 43,463 Operating expenses: Research and
development 2,995 2,890 9,330 9,253 Regulatory 2,847 834 5,637
2,422 Sales and marketing 6,810 6,457 20,336 17,189 General and
administrative 5,116 3,222 12,592 10,638 17,768 13,403 47,895
39,502 Operating income/(loss) (187) 1,773 3,001 3,961 Interest
income 348 154 847 411 Interest expense (3) - (13) (5) Income
before income taxes 158 1,927 3,835 4,367 Income taxes 90 148 398
148 Net income $68 $1,779 $3,437 $4,219 Earnings per common share
Basic $0.00 $0.05 $0.09 $0.11 Diluted $0.00 $0.05 $0.09 $0.11
Weighted average shares Basic 38,596 38,236 38,456 38,184 Diluted
39,469 39,393 39,302 39,321 TriPath Imaging, Inc. Condensed
Consolidated Balance Sheets (In thousands) September 30, December
31, 2006 2005 (unaudited) (audited) Assets Current assets: Cash and
cash equivalents $27,462 $22,457 Accounts and notes receivable, net
19,952 15,647 Net investment in sales-type leases 1,698 828
Inventory 10,049 12,564 Other current assets 2,146 1,676 Total
current assets 61,307 53,172 Customer use assets 9,627 8,044
Property and equipment 5,285 4,556 Net investment in sales-type
leases, net of current portion 3,402 1,807 Intangible assets 6,369
7,027 Other assets 1,783 2,362 Total assets $87,773 $76,968
Liabilities and stockholders' equity Current liabilities and
deferred revenue $14,544 $10,911 Long-term liabilities 135 98
Stockholders' equity: Common stock and additional paid-in capital
295,257 291,944 Accumulated deficit (222,478) (225,915) Accumulated
other comprehensive income 396 11 Treasury stock (81) (81) Total
stockholders' equity 73,094 65,959 Total liabilities and
stockholders' equity $87,773 $76,968 DATASOURCE: TriPath Imaging,
Inc. CONTACT: Stephen P. Hall, Chief Financial Officer of TriPath
Imaging, Inc., +1-336-290-8721 Web site:
http://www.tripathimaging.com/
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