EXHIBIT 99.1
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COMPANY CONTACT:
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INVESTOR CONTACTS: |
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Mark Fischer-Colbrie
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Jody Cain (jcain@lhai.com) |
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Chief Financial Officer
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Bruce Voss (bvoss@lhai.com) |
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Adeza Biomedical Corporation
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Lippert/Heilshorn & Associates, Inc. |
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(408) 745-0975 ext 520
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(310) 691-7100 |
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ir@adeza.com |
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For Immediate Release
ADEZA ANNOUNCES 2006 FIRST QUARTER FINANCIAL RESULTS
Company Affirms 2006 Revenue Guidance
Announces Nationwide Availability Through Quest Diagnostics
Conference Call to Discuss Gestiva and First Quarter Financial Results
Begins at 4:30 p.m. Eastern Time Today
SUNNYVALE, Calif. (May 4, 2006) – Adeza (NASDAQ: ADZA) today announced financial results for the
three months ended March 31, 2006.
For the first quarter of 2006 Adeza reported product sales of $10.8 million, an increase of 12%
from product sales of $9.6 million for the first quarter of 2005. This increase is due to higher
sales volume of FullTerm™, The Fetal Fibronectin Test. Sales during the first quarter of 2006
reflect the impact of ordering cycles by Adeza customers and to a lesser extent product pricing.
Net income for the first quarter of 2006 was $6,000, or diluted earnings per share of $0.00.
Reported results for the first quarter of 2006 include charges of $915,000, or $0.03 per diluted
share after income tax expense, for stock-based compensation due to the adoption of SFAS 123R. Net
income for the first quarter of 2005 was $1.5 million, or diluted earnings per share of $0.08.
The gross profit for the 2006 first quarter was $9.0 million, or 83.7%, and includes
stock-compensation expense of $46,000. This compares with gross profit of $8.2 million, or 85.2%,
for the prior-year first quarter.
Selling and marketing expenses for the 2006 first quarter were $6.0 million including
stock-compensation expense of $482,000, up from $4.7 million for the comparable quarter in 2005,
reflecting expansion of the company’s direct sales force. General and administrative expenses for
the quarter were $2.3 million including stock-compensation expense of $341,000, up from $1.5
million in the comparable quarter of the prior year, due primarily to costs associated with
operating as a public company. Research and development expenses were $1.7 million for the first
quarter of 2006 including stock-compensation expense of $46,000, compared with $864,000 in the
comparable quarter of the prior year, with the increase due mainly to costs related to product
development efforts, including costs related to Gestiva™, Adeza’s drug candidate for the prevention
of preterm birth in women who have a history of preterm delivery.
As of March 31, 2006 Adeza had cash and cash equivalents of $90.5 million, compared with $89.7
million as of December 31, 2005. Stockholders’ equity was $98.6 million and working capital was
$97.9 million as of March 31, 2006.
“We are extremely pleased to announce our submission of a New Drug Application to the FDA for a
major product candidate, Gestiva,” said Emory V. Anderson, president and chief executive officer.
“We were able to accomplish this milestone without incurring the expenses typically related to new
drug development while maintaining profitability.
“As also announced today, the nationwide availability of FullTerm, The Fetal Fibronectin Test
through Quest Diagnostics better positions us to further penetrate the fetal fibronectin test
market, particularly for women at risk for preterm birth. Quest, with its extensive network of
laboratories, will collect fetal fibronectin test samples directly from physicians’ offices and
clinics throughout the United States. We look forward to increasing product sales through this new
Quest program which allows for more convenient access to our test by physicians around the
country,” he said.
“While we continue to report double-digit year-over-year revenue growth, our first quarter revenue
results reflect the fact that customers do order products quarterly or semi-annually, so that the
timing of those orders can impact our quarterly results,” he added. “Our first quarter expenses
were in line with our expectations, and reflect costs associated with our annual sales meeting and
a full quarter’s impact of hiring 10 sales representatives.”
2006 Financial Guidance
Adeza today affirmed guidance for 2006 revenue to be in the range of $54 million to $57 million. It
also affirms that gross margin for 2006 is expected to exceed 80%, and that the full-year tax rate
will be between 45% and 49%, which is higher than the statutory tax rate primarily as a result of
accounting for stock-based compensation expense under SFAS 123R. Adeza expects SFAS 123R
compensation expenses for 2006 to be in the range of $2.8 million to $3.2 million, before costs
associated with the issuance of new option grants.
Conference Call
Adeza’s management will host an investment-community conference call today beginning at 4:30 p.m.
Eastern time (1:30 p.m. Pacific time) to discuss these results, the Gestiva announcement also made
today, and to answer questions.
Individuals interested in participating in the conference call may do so by dialing (888) 463-4383
for domestic callers, or (706) 634-5615 for international callers. A telephone replay will be
available for 48 hours following the conclusion of the call by dialing (800) 642-1687 for domestic
callers, or (706) 645-9291 for international callers, and entering reservation code 8492565.
The live call also will be available via the Internet on the Investors section of the company’s Web
site at www.adeza.com. A webcast replay of the call will be available following the conclusion of
the call.
About Adeza
Adeza designs, manufactures and markets innovative products for women’s health. Adeza’s initial
focus is on reproductive healthcare, using its proprietary technologies to predict preterm birth
and assess infertility. Adeza’s principal product is a patented diagnostic test, FullTerm, The
Fetal Fibronectin Test, which utilizes a single-use, disposable cassette and is analyzed on Adeza’s
patented TLiIQ® System. This product is approved by the U.S. Food and Drug
Administration (FDA) for use in assessing the risk of preterm birth. Adeza also markets and sells
the E-tegrity® Test, an infertility-related test to assess receptivity of the uterus to
embryo implantation in women with unexplained infertility.
Adeza cautions you that statements included in this press release that are not a description of
historical facts may be forward-looking statements, including, for example, statements relating to
Adeza’s future financial results, its sales and marketing strategy, its association with Quest
Diagnostics and its product candidate Gestiva. The inclusion of forward-looking statements should
not be regarded as a representation by Adeza that any of its plans will be achieved. Actual
results may differ materially from those set forth in this release due to the risks and
uncertainties inherent in Adeza’s business including, without limitation, risks and uncertainties
relating to the expansion of products, markets and offerings and additional product indications,
risks associated with the regulatory approval process for product candidates, and risks associated
with being in both the diagnostic and therapeutic businesses. Further information about these and
other risks is included in the Company’s Annual Report on Form 10-K and other periodic and current
reports filed by Adeza with the Securities Exchange Commission, which are available from the SEC’s
website (www.sec.gov), and also available on the Investor Relations section of our website. All
forward-looking statements are qualified in their entirety by this cautionary statement and Adeza
undertakes no obligation to revise or update this news release to reflect events or circumstances
after the date hereof.
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