2005 Total Revenues Increased Nearly 26% - Worldwide Reagent Sales
Increased 30% BURLINGTON, N.C., Jan. 31 /PRNewswire-FirstCall/ --
TriPath Imaging, Inc. (NASDAQ:TPTH) today reported that worldwide
revenues for the year ended December 31, 2005 increased nearly 26%
to $86.0 million from $68.5 million for the year ended December 31,
2004. Worldwide sales of reagents and disposables of $68.3 million
represented a 30% increase in 2005 compared to 2004. As a percent
of total revenues, worldwide reagent and disposable sales increased
to 79% in 2005 from 77% in 2004. Gross profit for 2005 increased
27% to $59.9 million, or 70% of sales, from $47.3 million, or 69%
of sales for 2004. The Company reported net income of $6.5 million,
or $0.17 per share in 2005, compared to net income of $605,000, or
$0.02 per share, for 2004. The Company was cash flow positive in
all quarters of 2005. Cash and cash equivalents at December 31,
2005 were approximately $22.5 million. The Company generated cash
of approximately $3.5 million for the full year 2005. "Our
performance in 2005 clearly demonstrated the fundamental strengths
of our business," said Paul R. Sohmer, M.D., TriPath Imaging's
Chairman, President and CEO. "We grew our revenues by nearly 26%;
we generated net income of $6.5 million, a $5.9 million improvement
from the prior year; we grew operating income from our cytology
business by 50%; and we moved new molecular oncology products
through internal and external research studies, into clinical
trials, and into the marketplace while generating significant
revenues from the sale of some of these molecular products for the
first time in our history." "We continued to leverage our cytology
business. Revenues of $84.2 million generated from the sale of our
cytology products drove nearly $22.1 million in operating income
from our commercial operations operating segment. Revenues
generated from worldwide sales of our higher margin SurePath
reagents and disposables increased by 30% from the prior year. The
number of SurePath liquid based Pap tests sold in 2005 grew over
41% in the U.S. and almost 26% outside the U.S." Dr. Sohmer
continued, "Tangible evidence of the progress that we made in our
molecular oncology business is reflected in the array of products
that we introduced; the presentation and publication of data
generated from internal and external research studies employing our
molecular reagents and imaging systems; the transition of our
microscopic slide based assays into clinical trials; the completion
of the development of our ELISA formatted blood based research use
only reagents for ovarian screening; and $1.8 million in revenues
generated from the early commercialization of some of our
microscopic slide based reagents, our reagent enabling products and
VIAS, the Ventana branded version of our interactive histology
imaging system." Dr. Sohmer concluded, "Given the fundamental
strengths that we again demonstrated in 2005, we have set a very
ambitious agenda for 2006 as we continue to execute on our near and
long term objectives. That being said, we are focused and well
prepared. We look forward to another profitable and productive
year." Fourth Quarter Results The Company reported fourth quarter
revenues of $23.9 million, a 31% increase from the fourth quarter
of 2004. In the fourth quarter of 2005, worldwide sales of reagents
and disposables of $18.7 million increased 29% from the fourth
quarter of 2004, accounting for 78% of total revenues, compared to
79% of total revenues in the fourth quarter of 2004. Instruments
represented 12% of total sales in the fourth quarter of 2005
compared to 9% in the fourth quarter of 2004. Gross profit for the
fourth quarter of 2005 increased 32% to $16.5 million, or 69% of
sales, from $12.5 million, or 68% of sales, in the fourth quarter
of 2004. Net income of $2.3 million in the fourth quarter of 2005,
or $0.06 per share, reflected a $2.0 million improvement from net
income of $308,000, or $0.01 per share, in the fourth quarter of
2004. Conference Call Details TriPath Imaging's management will
host a conference call today at 11:00 a.m. ET to discuss the
Company's fourth quarter and year-end financial results, business
highlights and future expectations. The call will be available by
dialing (888) 344-3716. International participants should call
(706) 634-4926. For interested parties unable to participate during
the live call, a telephone replay will be available beginning two
hours after the completion of the call until February 8, 2006. To
access this replay, U.S. participants should call (800) 642-1687.
International participants should call (706) 645-9291. Individuals
accessing the replay must enter the conference call ID number
4787530. A live web cast and replay of TriPath Imaging's call will
also be available online at http://www.tripathimaging.com/. 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 and
pharmacogenomic products and services for malignant melanoma and
cancers of the cervix, breast, ovary and prostate. 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
anticipated results of operations and product development efforts,
upcoming trials, our continued growth, anticipated research and
development cost reductions and our future profitability. Important
factors that may affect TriPath Imaging's operating results
include, without limitation: TriPath Imaging may not receive
revenues when or in the amounts anticipated; TriPath Imaging may be
unable to increase sales and revenues at its historical rates;
TriPath Imaging may be unable to increase its penetration of the
large commercial laboratory segment to the extent it expects, and
may not achieve revenues to the degree expected from the sale of
reagents and instrument systems derived from its molecular oncology
development program; TriPath Imaging's expanding sales and
marketing presence may not have the expected impact; the impact on
profitability of expensing stock based compensation under FAS
123(R) may be material; TriPath Imaging's results and profitability
in any particular period may be impacted by the timing of certain
non-cash sales discounts that TriPath Imaging will record in
connection with the vesting of certain warrants; expenses may
exceed expectations and TriPath Imaging may not maintain
profitability; changes in general economic conditions or the
healthcare industry may occur that adversely affect TriPath
Imaging's customers' purchasing plans; competition and competitive
pricing pressures may limit TriPath Imaging's flexibility with
respect to the pricing of its products; TriPath Imaging may need to
obtain additional financing in the future; TriPath Imaging may not
be able to develop and to protect adequately its proprietary
technology; TriPath Imaging and TriPath Oncology's products may not
receive FDA or other required regulatory approval when expected, if
at all; 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, 2004 and in its Quarterly Report on Form 10-Q for the
three and nine months ended September 30, 2005. TriPath Imaging,
Inc. Condensed Consolidated Statements of Income (In thousands,
except per share data) Three months ended Year ended December 31,
December 31, 2005 2004 2005 2004 (unaudited) (audited) (unaudited)
(audited) Revenues $23,856 $18,245 $85,961 $68,504 Cost of revenues
7,392 5,788 26,035 21,230 Gross Profit 16,464 12,457 59,926 47,274
Operating expenses: Research and development 3,099 3,044 12,352
11,280 Regulatory 981 765 3,403 3,882 Selling and marketing 7,251
4,941 24,440 18,640 General and administrative 2,914 3,460 13,552
13,138 14,245 12,210 53,747 46,940 Operating income 2,219 247 6,179
334 Interest income 191 67 605 289 Interest expense (4) (6) (9)
(18) Income before income taxes $2,406 $308 $6,775 $605 Income
taxes (127) - (275) - Net Income $2,279 $308 $6,500 $605 Earnings
per common share Basic $0.06 $0.01 $0.17 $0.02 Diluted $0.06 $0.01
$0.17 $0.02 Weighted-average common shares outstanding Basic 38,304
38,077 38,218 38,006 Diluted 39,075 39,216 39,270 39,151 TriPath
Imaging, Inc. Condensed Consolidated Balance Sheets (In thousands)
December 31, December 31, 2005 2004 (unaudited) (audited) Assets
Current assets: Cash and cash equivalents $22,457 $18,949 Accounts
receivable 16,475 13,643 Inventory 12,564 10,723 Other current
assets 1,676 1,582 Total current assets 53,172 44,897 Customer-use
assets 8,044 7,688 Property and equipment 4,556 3,290 Other assets
4,169 3,777 Intangible assets 7,027 7,882 Total assets $76,968
$67,534 Liabilities and stockholders' equity Current liabilities
and deferred revenue $11,009 $8,988 Total liabilities 11,009 8,988
Stockholders' equity: Common stock and additional paid-in capital
291,863 290,495 Deferred compensation - (11) Accumulated other
comprehensive income 11 477 Accumulated deficit (225,915) (232,415)
Total stockholders' equity 65,959 58,546 Total liabilities and
stockholders' equity $76,968 $67,534 Contact Stephen P. Hall Chief
Financial Officer 336-290-8721 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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