Deltagen, Inc. (Pink Sheets: DGEN), a leading provider of drug discovery
tools and services to the biopharmaceutical industry, today reported
unaudited consolidated financial results for the three months ended
September 30, 2012.
Revenues: The Company's consolidated revenues for the three
months ended September 30, 2012 totaled $0.211 million. The revenues in
the third quarter of 2012 were attributable primarily to license fees
associated with the provision of knockout mice and related phenotypic
data pursuant to orders placed by customers under the Company's DeltaOneTM
program. The consolidated revenues for the period included $0.010
million for Xenopharm, Inc. ("Xenopharm"), a wholly-owned subsidiary of
the Company. Benten BioServices' revenues and expenses are no longer
consolidated with those of Deltagen and its wholly-owned subsidiaries,
Xenopharm and Deltagen Research Laboratories, L.L.C. The application of
the Equity Method of Accounting now reports Benten BioServices'
operating results as a single line in Deltagen's financial statements,
which reflect Deltagen's 43.8% ownership interest in Benten BioServices.
The Equity Method of Accounting is described in the Company's Notes to
Consolidated Financial Statements and Management's Discussion and
Analysis of Financial Conditions and Results of Operations, which are
posted on the Company's website (www.deltagen.com).
Expenses: Total consolidated expenses for the three months ended
September 30, 2012 were $0.258 million. The expenses in the third
quarter of 2012 were attributable primarily to labor costs and other
general and administrative expenses, including $0.061 million in royalty
and commission expenses. As of September 30, 2012, the Company had
incurred aggregate total royalties to Lexicon Pharmaceuticals, Inc.
("Lexicon") of $5.702 million to a March 2005 settlement agreement
between Lexicon and the Company. Under the settlement, the maximum
aggregate amount of royalty payments due to Lexicon is $6.00 million.
Accordingly, up to $0.298 million in contingent royalty payments
remained owed to Lexicon as of September 30, 2012.
Net Income/Losses: Consolidated net losses before provision for
income taxes for the three months ended September 30, 2012 were $0.581
million, which included a net loss of $0.047 million from operations and
a recognized net loss of $0.534 million (43.8% of Benten BioServices'
Net Operating Results) from investments made by the Company in Benten
BioServices, Inc. ("Benten BioServices"), which was accounted for using
the Equity Method of Accounting.
Cash, Cash Equivalents and Accounts Receivable: As of September
30, 2012, the Company had $0.187 million in consolidated cash and cash
equivalents and $0.063 million in accounts receivable.
Major Events during Q3 2012:
Benten BioServices: Benten BioServices had received an aggregate
total of $2.940 million in secured bridge financing between January and
August 2012 ("Series A"). The Series A financing was led by Life
Sciences Green House of Central Pennsylvania and closed on August 15,
2012, at which time Benten BioServices ceased being a wholly-owned
subsidiary of Deltagen. Following the Series A closing, excluding Benten
BioServices' stock options, Deltagen held 43.8% of the outstanding
shares of Benten BioServices. Deltagen shall retain a seat on the board
of directors of Benten BioServices solely representing Deltagen so long
as it beneficially owns at least 10% of the outstanding common stock of
The unaudited consolidated financial statements for the third quarter of
2012, accompanying notes, and Management's Discussion and Analysis of
Financial Conditions and Results of Operations for such period will be
posted on Deltagen's website (www.deltagen.com).
Deltagen, Inc. is a provider of drug discovery tools to the
biopharmaceutical industry, and offers access to its inventory of
knockout mouse lines and related phenotypic data to enhance the
efficiency of target validation and drug discovery. In addition,
Deltagen offers target validation data in the areas of immunology and
metabolic diseases. Deltagen's products and programs have been validated
by customers and partners such as Eli Lilly & Co., GlaxoSmithKline,
Merck & Co., Inc. and Pfizer Inc. Benten BioServices, Inc., based in
Malvern, Pennsylvania, offers regulatory-compliant services designed to
address specific requirements for critical stages in product
development, including biosafety testing, raw materials testing, assay
and process validation services, cell banking and characterization
services, and technology platform-specific R&D support and consulting
services. For more information on Deltagen, visit the Company's website
Safe Harbor Statement
This press release contains "forward-looking statements," including
statements about Deltagen's future revenues, cash flows and operating
results, first-party royalty obligations and first-party licenses and
intellectual property, fund-raising efforts, Benten BioServices'
business plans, as well as other matters that are not historical facts
or information. These forward-looking statements are based on
management's current assumptions and expectations and involve risks,
uncertainties and other important factors, specifically including those
relating to Deltagen's ability to achieve its operational objectives and
revenue projections, that may cause Deltagen's actual results to be
materially different from any future results expressed or implied by
such forward-looking statements. Information identifying such important
risk factors is contained in the Company's annual financial disclosure's
"Management's Discussion and Analysis of Financial Conditions and
Results of Operations", which can be found at Deltagen's website at www.deltagen.com.
Deltagen undertakes no obligation to update or revise any such
forward-looking statements, whether as a result of new information,
future events or otherwise.
CONSOLIDATED BALANCE SHEET
CONSOLIDATED INCOME STATEMENT
Statements of Retained Earnings
CONSOLIDATED CASH FLOW
(Increase)/Decrease in operating assets
Increase/(Decrease) in operating liabilities
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