ALBANY, Ore., April 25 /PRNewswire-FirstCall/ -- Synthetech today announced revenues of approximately $5.8 million for its fiscal year ended March 31, 2006, a 40% decrease from fiscal 2005 revenues of $9.8 million. The Company expects to release audited financial results for the 2006 fiscal year in June 2006. This low point in revenues in recent years was primarily due to slowdowns and some cancellations in large-scale orders for key development pipeline and launched projects of pharmaceutical customers. Cash, cash equivalents and marketable securities were approximately $2.0 million at March 31, 2006.
Looking forward, M. "Sreeni" Sreenivasan, President and Chief Executive Officer, commented, "After a prolonged rough period marked by mounting losses, we are encouraged by the overall industry trends signaling a strong rebound. Our active portfolio of clinical pipeline customer projects continues to be robust. There has been a significant increase in inquiries and order activity for medium to large-scale projects in the past few months, resulting in our order backlog increasing from approximately $800,000 a year ago to over $4.6 million now. We expect to ship a majority of this backlog prior to September 30, 2006." Commenting on the Company's recently acquired technology for specialty resins used in solid phase synthesis, Mr. Sreenivasan indicated that there has been a high level of interest from the industry, with initial orders in hand and ongoing development of a broad product line offering. This segment is expected to contribute to sales growth during the second half of fiscal 2007.
Dr. Daniel Fagan, Chairman of the Board and the member of the Strategic Development Committee, added, "The Company's new strategic growth initiatives, which we discussed in the Company's Form 10-Q for the quarter ended December 31, 2005, have contributed significantly to the overall improvement in the Company's outlook. In order to further implement our growth initiatives, we are continuing our efforts to raise capital through a private placement of securities."
Management anticipates that Synthetech's revenue will continue to be volatile from period to period. Variability in Synthetech's level of revenue is based primarily on our participation in large-scale customer projects and the timing of shipments arising from these projects. Synthetech operates in a challenging business environment, characterized by the unpredictable dynamics and life cycle of pharmaceutical projects, which can lead to rapid fluctuations in the mix of projects and revenues. As the uncertainties inherent in drug development projects remain outside of Synthetech's control, it is difficult to predict the progress, timing and revenue potential of these projects.
About Synthetech
Synthetech, Inc. is a fine chemicals company specializing in organic synthesis, biocatalysis and chiral technologies. Synthetech develops and manufactures amino acid derivatives, specialty amino acids, peptide fragments, proprietary custom chiral intermediates and specialty resins, primarily for the pharmaceutical and cosmeceutical industries. Synthetech's products support the development and manufacture of therapeutic peptides and peptidomimetic small molecule drugs at every stage of a customer's clinical development pipeline, and are used as ingredients in drugs [under development] for the treatment of AIDS, cancer, cardiovascular and other diseases, and in cosmeceuticals.
Forward-Looking Statements
This press release includes "forward looking" information (as defined in Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934), including, without limitation, statements regarding: future performance and operating results of Synthetech, our growth strategy, including implementation thereof and developments and prospects relating to the Company's specialty resin business; the timing of product shipments; industry strength, trends and status; our ability to obtain financing; and matters relating to drug development progress. Forward looking statements include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain the words "believe," "anticipate," "expect," "estimate," "project," "will be," "will continue," "will likely result," or words or phrases of similar meanings. Investors are cautioned that forward-looking statements involve risks and uncertainties, and various factors could cause actual results to differ materially from those in the forward-looking statements. The risks and uncertainties include, but are not limited to, the following: our fluctuating operating results; our potential inability to raise capital to fund our operations or implement our growth strategy; the uncertain market for products; the unpredictability of drug development progress, including regulatory approvals; potential loss of a significant customer; potential termination or suspension by customer of significant projects or cancellation of orders prior to shipment; production factors; and economic conditions and commercial factors affecting the fine chemicals industry. Investors are urged to read Synthetech's filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the fiscal year ended March 31, 2005 and our Report on Form 10-Q for the quarter ended December 31, 2005, for a further description of risks and uncertainties related to forward-looking statements made by Synthetech as well as to other aspects of our business. Synthetech does not intend to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations with respect to them or any change in events, conditions or circumstances on which any such statement is based.
MORE INFORMATION: Web site: www.synthetech.com E-mail: investor@synthetech.com CONTACT: M. "Sreeni" Sreenivasan, President & CEO Gary Weber, CFO PO Box 646 Albany, Oregon 97321 541-967-6575
Synthetech, Inc.CONTACT: M. "Sreeni" Sreenivasan, President & CEO, Gary Weber, CFO, bothof Synthetech, Inc., +1-541-967-6575, or investor@synthetech.com
Web site: http://www.synthetech.com//