REDWOOD CITY, Calif., Feb. 8 /PRNewswire-FirstCall/ -- Maxygen, Inc. today reported financial results for the fourth quarter and year ended December 31, 2005.
Maxygen reported a loss applicable to common stockholders of $18.6 million, or $0.52 per share, for the year ended December 31, 2005, as compared to income applicable to common stockholders of $8.3 million, or $0.24 per share, for the prior year. Maxygen reported a loss from continuing operations of $35.1 million, or $0.98 per share, for the year ended December 31, 2005, compared to a loss from continuing operations of $49.1 million, or $1.40 per share, in 2004.
As a result of the change in Maxygen’s accounting for its investment in Codexis on the equity accounting basis, Maxygen does not include the operating results of Codexis in its financial statements after February 28, 2005. Financial results for 2004 contained herein include the operating results of Codexis for the three and twelve month periods reported.
Revenue for the year ended December 31, 2005 was $14.5 million compared to $16.3 million in 2004, a decrease of eleven percent. The decrease in revenue was primarily due to the change to the equity method of accounting for Maxygen’s investment in Codexis, as of February 28, 2005, and reduced activities related to the scheduled wind-down of Maxygen’s collaborative research programs as it focused its efforts on development of its product candidates. This decrease was partially offset by the two milestones received from Roche in 2005 for Maxygen’s next-generation interferon alpha product candidate and an increase in grant revenues.
At December 31, 2005, cash, cash equivalents and marketable securities totaled $188.3 million.
Maxygen reported a loss applicable to common stockholders of $5.9 million, or $0.16 per share, for the fourth quarter of 2005 compared to a loss applicable to common stockholders of $15.6 million, or $0.44 per share, in the comparable period of 2004.
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“In 2005 we made significant achievements on many fronts,” said Russell Howard, Ph.D., Chief Executive Officer of Maxygen. “Maxygen advanced the preclinical development of MAXY-G34, our next-generation G-CSF product candidate, and we received two significant milestones from our partner Roche for the advancement of our MAXY-alpha next-generation interferon alpha product candidate towards clinical development. We established a second alliance with Roche for co-development of our next-generation factor VII product candidates and we received $14.4 million in grant and contract funding of our HIV vaccine research. We believe that 2006 will be an important year for Maxygen with our next-generation G-CSF and interferon alpha product candidates expected to enter clinical development and the advancement of our next-generation factor VII product for acute indications”.
2005 Highlights -- Two preclinical milestones for the advancement of Maxygen’s next-generation IFN-alpha in collaboration with Roche. -- $14.4 million in government grant and contract funding for HIV vaccine research. -- Co-development alliance with Roche for next-generation factor VII for acute indications. About Maxygen
Maxygen, Inc., headquartered in Redwood City, California, is focused on creating novel products using its integrated proprietary technologies for human therapeutics. Maxygen’s technologies bring together advances in molecular biology and protein modification to create novel biotechnology products. Forward-Looking Statements This news release contains forward-looking statements about our research and business prospects, including those relating to: our ability to advance our next-generation G-CSF, interferon alpha or factor VII product candidates, or any other pharmaceutical products, into clinical development; the timing or success of the filing of an IND for any such product candidate; the success or continuation of any existing or future alliance, collaboration or research program; and whether we will achieve any future milestones or receive any payments or grants for any existing or future product candidates or research programs. Such statements involve risks and uncertainties that may cause results to differ materially from those set forth in these statements. Among other things these risks and uncertainties include, but are not limited to: changing research and business priorities of Maxygen and/or its collaborators; the inherent uncertainties of biological research; our ability to develop human therapeutic drugs in an increasingly competitive biotechnology industry and the uncertain timing of such development; competitors producing superior products; and our future ability to enter into and/or maintain research and commercialization collaborations. These and other risk factors are more fully discussed in our Form 10-K for the year ended December 31, 2004, including under the caption “Risk Factors,” and in our other periodic SEC reports, all of which are available from Maxygen at www.maxygen.com. Maxygen disclaims any obligation to update or revise any forward-looking statement contained in this release as a result of new information or future events or developments. Maxygen is a registered trademark of Maxygen, Inc. The Maxygen logo is a trademark of Maxygen, Inc.
Selected Consolidated Financial Information Condensed Consolidated Statements of Operations (in thousands, except per share amounts) Three Months Ended Twelve Months Ended December 31, December 31, 2005(1) 2004(3) 2005(2) 2004(3) (unaudited) (unaudited) (Note 1) Revenues: Collaborative research and development revenue $5,085 $3,246 $11,594 $14,333 Grant revenue 1,186 675 2,907 1,942 Total revenues 6,271 3,921 14,501 16,275 Expenses: Research and development 10,814 16,253 41,789 53,294 General and administrative 3,015 4,422 13,153 14,372 Stock compensation expense 62 8 183 355 Total operating expenses 13,891 20,683 55,125 68,021 Loss from operations (7,620) (16,762) (40,624) (51,746) Interest income, net 1,764 1,769 5,572 4,055 Equity in losses of minority investee -- (395) -- (1,395) Loss from continuing operations (5,856) (15,388) (35,052) (49,086) Net income from discontinued operations -- -- -- 58,428 Cumulative effect adjustment -- -- 16,616 -- Net income (loss) $(5,856) $(15,388) $(18,436) $9,342 Net income (loss) $(5,856) $(15,388) $(18,436) $9,342 Subsidiary preferred stock accretion -- (250) (167) (1,000) Income (loss) applicable to common stockholders $(5,856) $(15,638) $(18,603) $8,342 Basic and diluted earnings (loss) per common share: Continuing operations $(0.16) $(0.43) $(0.98) $(1.40) Discontinued operations $-- $-- $-- $1.66 Cumulative effect adjustment $-- $-- $0.46 $-- Applicable to common stockholders $(0.16) $(0.44) $(0.52) $0.24 Shares used in computing basic and diluted earnings (loss) per common share 35,888 35,456 35,765 35,176 (1) Does not include operations of Codexis (2) Includes operations of Codexis through February 28, 2005 (3) Includes operations of Codexis for all of period Condensed Consolidated Balance Sheets (in thousands) December 31, December 31, 2005 2004 (unaudited) (Notes 1 and 2) Cash, cash equivalents and marketable securities $188,323 $232,893 Other current assets 9,606 8,781 Property and equipment, net 4,068 7,677 Goodwill and other intangibles, net 12,192 12,192 Other assets 334 1,562 Total assets $214,523 $263,105 Current liabilities $11,652 $16,080 Non-current deferred revenue 5,517 1,718 Long-term obligations 10 1,786 Minority Interest -- 32,180 Stockholders’ equity 197,344 211,341 Total liabilities and stockholders’ equity $214,523 $263,105 Note 1: Derived from consolidated audited financial statements as of December 31, 2004. Note 2: Cash, cash equivalents and marketable securities as of December 31, 2004 includes $17.2 million which may only be used for Codexis operations. Footnotes Reconciliation of GAAP loss from continuing operations to operating cash utilization (in thousands) Maxygen Codexis Total Loss from continuing operations $(33,747) $ (1,305) $(35,052) Stock Compensation 183 -- 183 Depreciation Expense 3,268 262 3,530 Acquisition of property and equipment (1,430) (810) (2,240) Operating Cash Utilization $(31,726) $(1,853) $(33,579)
Maxygen, Inc.
CONTACT: Jeannine Medeiros, Director, Investor Relations of Maxygen, Inc.,+1-650-298-5853, or jeannine.medeiros@maxygen.com
Web site: http://www.maxygen.com/
