Sequenom Inc. Reports Third Quarter 2005 Financial Results

SAN DIEGO, Nov. 1 /PRNewswire-FirstCall/ -- Sequenom, Inc. today reported financial results for the third quarter and the nine-month period ended September 30, 2005. Sequenom's total revenues for the third quarter of 2005 were $4.6 million, compared to $5.2 million for the third quarter of 2004. Total costs and expenses for the third quarter of 2005 were $10.9 million, down from $13.9 million for the third quarter of 2004. Sequenom's net loss for the third quarter of 2005 decreased to $6.0 million, or $0.15 per share, compared to $8.3 million, or $0.21 per share for the third quarter of 2004, representing a 29% improvement in net loss per share.

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Total revenues for the nine-month period ended September 30, 2005 decreased to $15.0 million, compared to $16.4 million for the same period in 2004. The net loss for the nine-month period ended September 30, 2005 decreased to $19.5 million, or $0.48 per share, compared to $28.1 million, or $0.71 per share for the same period in 2004.

On September 30, 2005, the Company held cash, cash equivalents, short-term investments and restricted cash totaling $19.7 million.

"We are continuing to implement cost-cutting measures announced last month as part of our new business strategy. We expect to realize $7 to $10 million in improved cash flow in 2006," said Harry Stylli, MBA, Ph.D., President and Chief Executive Officer of Sequenom. "As our focused business strategy gains traction in the near term, we intend to increase our leverage in the market with our iPLEX(TM) assay, our newly launched services business, and eventually through commercial products for quantitative gene expression (QGE) analysis and DNA methylation analysis. Gene expression and methylation analyses are particularly important for epigenetic studies in cancer research," he added. "We also believe the potential of our MassARRAY platform and our intellectual property for non-invasive prenatal molecular diagnostics provides upside for Sequenom in the future."

Corporate Goals and Milestones * Create Diverse Higher Margin and Recurring Revenue Streams and Drive Growth Offer QGE and methylation services in 4Q2005 and commercial products for QGE and methylation in 1Q2006 Offer 2nd generation iPLEX assay with increased multiplexing levels in 4Q2006 Diversify customer base into pharmaceutical, biotechnology and animal genotyping * Unlock the Upside in Molecular Diagnostics Launch non-invasive prenatal diagnostics on MassARRAY system and other platforms Implement regulatory strategy Develop other diagnostic tests for MassARRAY system Introduce the first diagnostic test for Rhesus D incompatibility in 2007 Forward integrate or partner with a CLIA lab * Develop Strategic Partnerships in 2006 Validate, share risk and rapidly expand markets * Improve Operating Efficiencies and Execute Effectively Explore out-sourcing opportunities Establish effective supply chain management Increase productivity Web Cast of Conference Call

Sequenom's management will hold a conference call today at 8:00 a.m. ET to discuss the Company's third quarter 2005 results and update its corporate goals and milestones. A live web cast is available through a link that is posted on the Company's website at www.sequenom.com and at http://phx.corporate-ir.net/phoenix.zhtml?p=irol- eventDetails&c=84955&eventID=1154536. The web cast will be available online through November 22, 2005. A telephone replay of the conference call also will be available for 48 hours at (800) 753-6121- or (402) 220-2676, conference ID: sequenom.

About Sequenom

Sequenom is committed to providing the best genetic analysis products that translate genomic science into superior solutions for molecular medicine and biomedical research. The Company's proprietary MassARRAY system is a high- performance DNA analysis platform that efficiently and precisely measures the amount of genetic target material and variations therein. The system is able to deliver reliable and specific data from complex biological samples and from genetic target material that is only available in trace amounts.

Sequenom(R), MassARRAY(R) and iPLEX(TM) are trademarks of Sequenom, Inc.

Except for the historical information contained herein, the matters set forth in this press release, including statements relating to Sequenom's expected cash flow savings in 2006, intention to increase its leverage in the market with certain products and services, the potential of Sequenom's MassARRAY platform and intellectual property for non-invasive prenatal molecular diagnostics, and all of the statements under the section titled Corporate Goals and Milestones, are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including the risks and uncertainties associated with Sequenom's financial guidance and expectations, including, but not limited to, the risks and uncertainties associated with implementing cost-cutting measures, and the risks and uncertainties associated with Sequenom's technologies, financial position, market demand for and acceptance of its current products and applications, and developing and commercializing new products, services, and applications, including molecular diagnostics products and applications, partnering with collaborators, and other risks detailed from time to time in Sequenom's SEC filings, including Sequenom's Annual Report on Form 10-K for the year ended December 31, 2004, and most recent Quarterly Report on Form 10-Q. These forward-looking statements are based on current information that is likely to change and speak only as of the date hereof.

SEQUENOM, Inc. Condensed Consolidated Financial Statements (in thousands, except per share data) Consolidated Summary of Operations Three Months Ended Nine Months Ended September 30, September 30, 2005 2004 2005 2004 (Unaudited) (Unaudited) Revenues: Consumables $2,846 $3,509 $8,244 $9,541 Other product related 1,694 1,316 6,428 5,936 Services -- -- -- 199 Research 27 420 351 677 Total revenues 4,567 5,245 15,023 16,353 Costs and expenses: Cost of product & service revenue 2,032 2,469 7,805 8,971 Research and development expenses 2,547 3,524 8,771 14,726 Selling and marketing expenses 2,828 2,591 8,460 8,259 General and administrative expenses 2,342 2,680 8,460 9,388 Restructuring charge 526 1,943 314 1,943 Amortization of acquired intangibles 504 681 1,511 2,394 Amortization of deferred stock-based compensation 89 -- 342 -- Total costs and expenses 10,868 13,888 35,663 45,681 Operating loss (6,301) (8,643) (20,640) (29,328) Net interest income 75 81 253 238 Other income, net (44) (17) 207 177 Loss before income taxes (6,270) (8,579) (20,180) (28,913) Deferred income tax benefit 232 275 697 856 Net loss $(6,038) $(8,304) $(19,483) $(28,057) Net loss per share, basic and diluted: $(0.15) $(0.21) $(0.48) $(0.71) Weighted average of shares outstanding, basic and diluted 40,343 39,674 40,382 39,645 Consolidated Balance Sheet Information September 30, December 31, 2005 2004 (Unaudited) (Audited) Assets: Cash, cash equivalents, short-term investments and restricted cash $19,684 $37,943 Property, equipment and leasehold improvements, net 5,977 6,722 Other assets, including intangibles 11,720 13,821 Total assets $37,381 $58,486 Liabilities and Stockholders' Equity: Deferred revenue 1,937 1,424 Other liabilities 16,714 18,990 Stockholders' equity 18,730 38,072 Total liabilities and stockholders' equity $37,381 $58,486

CONTACT: Amy Caterina, Investor Relations, of Sequenom, Inc.,+1-858-202-9033, acaterina@sequenom.com

Web site: http://www.sequenom.com//