FT. MYERS, Fla., Oct. 27 /PRNewswire-FirstCall/ -- NeoGenomics, Inc. today announced its results for the three months ending September 30, 2005. Significant accomplishments during the quarter included the following:
-- 359% increase in Q3 FY 2005 revenues vs. Q3 FY2004 -- 62% sequential increase in Q3 FY 2005 revenues vs. Q2 FY2005 -- 38% of cases ordered more than one test per case vs. 30% of cases in Q2 FY2005 -- Initiated testing for breast cancer, bladder cancer and cervical cancer -- Landed 12 new clients during the quarter further accelerating the momentum of our national expansion strategy -- Implemented “NeoNet”, a new laboratory information system (LIS) with online reporting capabilities
Robert Gasparini, the Company’s President, stated, “I am happy with the progress we made during the third quarter, including substantial revenue growth, continued increase in the number of tests per case and going live with NeoNet. Our revenues increased $215,000 or 62% from the second quarter, which was the same sequential rate of growth we experienced from the first quarter to the second quarter. The fact that our growth rate did not slow at all in the third quarter, despite the fact that we were growing off a much larger base of business, is a testament to the strength of our operations. During the quarter, we also initiated three new lines of testing for breast cancer, bladder cancer and cervical cancer. In addition, our customers continue to embrace our Fluorescence In-Situ Hybridization (FISH) and Flow Cytometry testing services, which were launched earlier in the year. This drove a 65% increase in our testing volume versus the second quarter and a 24% increase in our number of tests per case.”
Mr. Gasparini went on to say, “Our new LIS system brings several key benefits to NeoGenomics including most importantly the ability for clients to access their patient results online through a secure 128 bit encrypted website. Other capabilities include the ability for clients to order tests online, utilization of barcode technology for enhanced tracking, the ability to customize reports to our client needs and operational efficiencies through automation of previous manual processes. The successful implementation of the NeoNet system was a critical milestone in our history. It will allow us to scale our operations many fold over our current testing volumes and should lead to significant productivity growth among our employees.”
Steven Jones, the Company’s acting Principal Financial Officer and a Director, stated, “Our third quarter results included approximately $128,000 of non-cash expenses and approximately $49,000 of non-recurring expenses associated with recruiting the rest of our management team and implementing the NeoNet laboratory information system. Since June, we have hired a Director of Finance, a Director of Operations and National Sales Director, which completes the hiring of our core management team.
Mr. Jones also added, “Although our net loss for the quarter, exclusive of non-recurring expenses, was approximately $191,000, our momentum on a monthly basis really began to increase late in the quarter. During September, our revenue increased by 36% from August to approximately $240,000 for the month and our net loss, exclusive of non-recurring expenses, was reduced to approximately $45,000 for the month. We expect to turn net income positive on a monthly basis at some point over the next 3-4 months.”
The attached financial results, including a reconciliation of non-cash and non-recurring expenses, should be read in conjunction with the Company’s Quarterly Report on Form 10-QSB, which will be filed with the SEC next week.
About NeoGenomics, Inc.
NeoGenomics, Inc. is a clinical laboratory that offers genetic and molecular cancer diagnostic testing services. NeoGenomics is headquartered in Fort Myers, FL and services the needs of the oncologists, pathologists and hospitals throughout the United States. For additional information about NeoGenomics, please visit our website at http://www.neogenomics.org.
Forward Looking Statements
Except for historical information, all of the statements, expectations and assumptions contained in the foregoing are forward-looking statements. These forward looking statements involve a number of risks and uncertainties that could cause actual future results to differ materially from those anticipated in the forward looking statements, including, but not limited to, the Company has incurred significant losses since its inception and has experienced negative operating margins and negative cash flows from operations, any adverse effect or limitations caused by governmental regulations, the company’s ability to attract and retain qualified personnel, to initiate and develop client relationships, to gain market acceptance of service offerings, as well as other risks described from time to time in the company’s filings with the Securities and Exchange Commission. Although the Company has used its best efforts to be accurate in making those forward-looking statements, there can be no assurance that the assumptions made by management will materialize. In addition, the information set forth in the Company’s Form 10-KSB for the fiscal year ended December 31, 2004, describes certain additional risks and uncertainties that could cause actual results to vary materially from the future results covered in such forward-looking statements. The Company undertakes no obligation to publicly revise or update the forward looking statements to reflect new information, subsequent events or otherwise.
NeoGenomics, Inc. CONSOLIDATED BALANCE SHEET AS OF September 30, 2005 (unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $76,823 Accounts receivable (net of allowance for doubtful accounts of $20,140) 374,090 Inventories 44,366 Other current assets 46,656 Total current assets 541,935 PROPERTY AND EQUIPMENT (net of accumulated depreciation of $225,648) 442,716 OTHER ASSETS 14,002 TOTAL $998,653 LIABILITIES AND STOCKHOLDERS’ DEFICIT CURRENT LIABILITIES: Accounts payable $274,545 Deferred revenue 110,000 Accrued and other liabilities 53,627 Total current liabilities 438,172 LONG TERM LIABILITIES (net of unamortized discount of $97,090) 1,263,361 TOTAL LIABILITIES 1,701,533 STOCKHOLDERS’ DEFICIT: Common stock, $.001 par value, 100,000,000 shares authorized; 22,576,975 shares issued and outstanding 22,577 Additional paid-in capital 9,934,250 Deficit (10,659,707) Total stockholders’ deficit (702,880) TOTAL $998,653 NeoGenomics, Inc. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) For the For the For the For the Nine-Months Nine-Months Three-Months Three-Months Ended Ended Ended Ended September September September September 30, 2005 30, 2004 30, 2005 30, 2004 REVENUE $1,134,429 $422,254 $559,349 $121,859 COST OF REVENUE 683,694 417,133 313,176 132,773 GROSS (DEFICIT) PROFIT 450,735 5,121 246,173 (10,914) OPERATING EXPENSES: Selling, general and administrative 946,358 447,510 424,470 137,091 Interest expense 140,845 66,820 61,640 22,851 Total operating expenses 1,087,203 514,330 486,110 159,942 NET INCOME (LOSS) $(636,468) $(509,209) $(239,937) $(170,856) NET INCOME (LOSS) PER SHARE- Basic and Diluted $(0.03) $(0.03) $(0.01) $(0.01) WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - Basic and Diluted 22,145,593 19,350,912 22,526,370 20,785,612 NeoGenomics, Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) For the For the Nine-Months Nine-Months Ended Ended September September 30, 2005 30, 2004 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $(636,468) $(509,209) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 88,335 64,908 Amortization of credit facility discount 34,247 - Amortization of debt issue costs 13,973 - Other Amortization 14,009 - Equity-based compensation 64,244 - Provision for bad debts 65,727 12,694 Changes in assets and liabilities, net: (Increase) decrease in accounts receivables, net of write-offs (383,326) (15,179) (Increase) decrease in inventory (29,244) 4,370 (Increase) decrease in pre-paid expenses (25,223) (2,217) (Increase) decrease in other current assets 3,474 (6,040) (Increase) decrease in deposits 1,500 4,540 Increase (decrease) in accounts payable and other liabilities 104,161 (61,069) NET CASH USED IN OPERATING ACTIVITIES (684,592) (507,202) CASH FLOWS FROM INVESTING ACTIVITIES - Purchases of property and equipment (82,659) (14,473) CASH FLOWS FROM FINANCING ACTIVITIES: Advances from affiliates, net 620,451 80,000 Debt issue costs (53,587) - Issuances of common stock, net of transaction expenses 164,662 740,228 NET CASH PROVIDED BY FINANCING ACTIVITIES 731,526 820,228 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (35,725) 298,533 CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 112,548 25,051 CASH AND CASH EQUIVALENTS, END OF PERIOD $76,823 $323,604 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Interest paid $89,834 $86,474 Income taxes paid $- $- NeoGenomics, Inc. Schedule of Non-cash Expenses Included in GAAP Net Loss For the For the For the For the Nine-Months Nine-Months Three-Months Three-Months Ended Ended Ended Ended September September September September 30, 2005 30, 2004 30, 2005 30, 2004 Depreciation $88,335 $64,908 $32,647 $25,007 Amortization of Credit Facility Warrants 34,247 - 16,417 - Amortization of Debt Issue Costs 13,973 - 6,698 - Other Amortization 14,009 - 14,009 - Stock-based Compensation 64,244 - 22,233 - Provision for Bad Debts 65,727 12,694 35,650 3,654 Total Non-cash Expenses $280,534 $77,602 $127,654 $28,660 Reconciliation of GAAP Net Loss to Non-GAAP Net Loss For the For the For the For the Nine-Months Nine-Months Three-Months Three-Months Ended Ended Ended Ended September September September September 30, 2005 30, 2004 30, 2005 30, 2004 GAAP Net Loss $(636,468) $(509,209) $(239,937) $(170,856) Non-recurring recruiting fees 47,000 - 47,000 - Non-recurring technology implementation expenses 25,916 - 1,600 - Non-GAAP Net Loss* $(563,562) $(509,209) $(191,337) $(170,856) * GAAP net loss adjusted for non-recurring expenses.
NeoGenomics, Inc.
CONTACT: Investor Relations - Mr. Steven Jones of NeoGenomics, Inc., +1-239-598-0964, sjones@neogenomics.org
Web site: http://www.neogenomics.org/
