Enzo Biochem Reports First Half and Fiscal Second Quarter Operating Results; New Clinical Trials; Gains Posted at Enzo Clinical Labs.FARMINGDALE, N.Y. -- Enzo Biochem, Inc. (NYSE NYSE See: New York Stock Exchange :ENZ), a leading biotechnology company specializing in gene identification and genetic and immune regulation technologies for therapeutic and diagnostic applications, today reported financial results for the fiscal three and six months ended January 31, 2005. Fiscal first half revenues totaled $21.5 million, compared with $21.3 million in the corresponding period a year ago. Income before taxes, including the initial $14.0 million settlement gain recorded upon signing of the agreement with Digene in October 2004, amounted to $11.2 million, compared with a loss of $3.6 million in the corresponding year-ago period. Net income for the first six months of fiscal 2005 amounted to $6.5 million, or $0.20 per diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of , compared with a net loss of $1.8 million, or ($0.06) per diluted share, a year earlier. "The second quarter of fiscal 2005 showed solid progress," said Barry Weiner, President of Enzo. "Enzo Clinical Labs had an excellent performance, with strong revenue growth. Enzo Life Sciences recorded its first royalty income under the Digene Corporation settlement. Overall revenues, however, were adversely affected by a determination not to recognize revenues from Roche Diagnostic Systems because of ongoing litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , as compared to a year ago when full revenues were recognized. In addition, Enzo Therapeutics therapeutics Treatment and care to combat disease or alleviate pain or injury. Its tools include drugs, surgery, radiation therapy, mechanical devices, diet, and psychiatry. continued to move ahead with several clinical trials, including a newly initiated Phase II investigation of treatment for non-alcoholic steatohepatitis. The second fiscal quarter, overall, was a productive one, with favorable momentum." For the three months ended January 31, 2005, total revenues amounted to $11.2 million, compared with $11.0 million in the corresponding year-ago period and $10.3 million in the preceding first quarter of the year. The loss before taxes declined to $0.9 million, from $2.8 million a year ago. The second fiscal quarter net loss declined to $0.5 million, compared with a year-ago loss of $1.5 million, an improvement of $1.0 million. Diluted loss per share equaled ($0.02), compared to ($0.05) a year earlier. Results for the second fiscal quarter of 2005 reflected a reduction in the provision for uncollectible receivables to $1.1 million, from $3.1 million a year earlier, and reduced legal expenses of $1.2 million, compared to $1.8 million a year ago. Research and development expenses for the quarter were also lower, totaling $2.0 million, compared with $2.3 million, due to the timing of certain clinical-related activities. The increase in selling, general and administrative expenses of $1.0 million principally reflected increased expenses in connection with the Company's continued expansion of the marketing and information technology programs for both Enzo Labs and Enzo Life Sciences. Second fiscal quarter revenues at Enzo Clinical Labs increased to $8.0 million, from $7.1 million a year ago, an increase of 13%. Gross profit increased to $5.1 million, compared with $4.5 million a year ago. Other costs and expenses amounted to $4.2 million, compared with $5.6 million a year ago. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. amounted to $0.9 million, compared to a year-ago operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $1.1 million, a $2.0 million improvement, and was up from the fiscal 2005 first quarter of $0.6 million. At Enzo Life Sciences, total revenues, including Digene royalties for the quarter, totaled $3.3 million, compared with $4.0 million in the corresponding year-ago quarter. The year-ago quarter included revenue from Roche, but as noted in light of recent litigation, current Roche revenues are not being recorded. Sequentially, Life Sciences revenues were up from $2.5 million in the first fiscal quarter of 2005, reflecting both the Digene royalties and direct sales. Direct sales of Life Sciences products, including those for amplification and labeling for both low and high density arrays, particularly the GeneBeam(TM) line, increased year-over-year. Enzo Biochem's balance sheet remains strong. As of January 31, 2005, cash, cash equivalents and investments totaled $81.5 million. Working capital exceeded $99 million, and shareholder's equity was over $110 million. The Company remains debt-free. Enzo Therapeutics Activity Enzo Therapeutics is aggressively pursuing its drug development programs. The expanded study of Alequel(TM), the Company's therapeutic modality therapeutic modality, n an intervention used to heal someone. See model, biomedical and homeopathy. for management of Crohn's disease Crohn's disease: see colitis. is underway and subjects are continuing to be enrolled. A clinical trial of EGS EGS European Geophysical Society EGS European Graduate School EGS El Goonish Shive (webcomic) EGS Environmental Goods and Services EGS Employment Guarantee Scheme (UK) EGS EOS Ground System 21, one of Enzo's proprietary drug compounds, was initiated last week for the treatment of non-alcoholic steatohepatitis (NASH Nash , Ogden 1902-1971. American writer known for his droll epigrammatic verse, much of which appeared in the New Yorker. Noun 1. Nash - United States writer noted for his droll epigrams (1902-1971) Ogden Nash or fatty liver Fatty Liver Definition Fatty liver is the collection of excessive amounts of triglycerides and other fats inside liver cells. Description ) and subjects are currently being enrolled. A Phase I safety trial of EGS21 was successfully concluded last year. This study is being partially funded by a $1.0 million grant from the Israel-U.S. Binational bi·na·tion·al adj. Of, relating to, or involving two nations. Industrial Research and Development Foundation (BIRD). The Company has received approval to move forward with clinical trials to evaluate the effect of EGS21 in the treatment of other conditions. A Phase II study will compare EGS21 and Alequel(TM) in the treatment of Crohn's disease
The treatment of Crohn's disease is sequential: to treat acute disease, and then to maintain remission. Treatment initially involves the use of medications to treat any infection and to reduce inflammation. and will begin shortly. A Phase II trial to study the effect of EGS21 in the treatment of HCV-associated chronic active hepatitis chronic active hepatitis 1. Obsolete term. See Chronic hepatitis2. Chronic viral hepatitis has also been approved. In addition, Enzo has received approval to begin a Phase I trial to evaluate the use of oral immune regulation for the management of individuals suffering from rheumatoid arthritis rheumatoid arthritis Chronic, progressive autoimmune disease causing connective-tissue inflammation, mostly in synovial joints. It can occur at any age, is more common in women, and has an unpredictable course. who have been treated with Remicade(R) and have developed antibodies against Remicade(R). The Phase I/II clinical study of HGTV-43(TM), Enzo's gene medicine for HIV-1 infection is proceeding with the opening of another testing site. In addition, the Company has a number of new compounds in preclinical preclinical /pre·clin·i·cal/ (-klin´i-k'l) before a disease becomes clinically recognizable. pre·clin·i·cal adj. 1. development that could provide therapy for treating bone disorders including osteoporosis osteoporosis (ŏs'tēō'pərō`sĭs), disorder in which the normal replenishment of old bone tissue is severely disrupted, resulting in weakened bones and increased risk of fracture; osteopenia , bone loss, fractures, abnormalities, diseases, and other applications. About Enzo Enzo Biochem is engaged in the research, development and manufacture of innovative health care products based on molecular biology molecular biology, scientific study of the molecular basis of life processes, including cellular respiration, excretion, and reproduction. The term molecular biology was coined in 1938 by Warren Weaver, then director of the natural sciences program at the Rockefeller and genetic engineering techniques, and in providing diagnostic services diagnostic services, n.pl the imaging and laboratory capabilities available for determining the cause of an illness. to the medical community. The Company's proprietary labeling and detection products for gene sequencing and genetic analysis are sold to the life sciences market throughout the world. The Company's therapeutic division is in various stages of clinical evaluation clinical evaluation Medtalk An evaluation of whether a Pt has symptoms of a disease, is responding to treatment, or is having adverse reactions to therapy of its proprietary gene medicine for HIV-1 infection and its proprietary immune regulation medicines for hepatitis B Hepatitis B Definition Hepatitis B is a potentially serious form of liver inflammation due to infection by the hepatitis B virus (HBV). It occurs in both rapidly developing (acute) and long-lasting (chronic) forms, and is one of the most common chronic and hepatitis C Hepatitis C Definition Hepatitis C is a form of liver inflammation that causes primarily a long-lasting (chronic) disease. Acute (newly developed) hepatitis C is rarely observed as the early disease is generally quite mild. infection and for Crohn's disease. The Company also holds a patent covering a method and materials for correcting point mutations point mutation n. A mutation that involves a single nucleotide and may consist of loss of a nucleotide, substitution of one nucleotide for another, or the insertion of an additional nucleotide. or small insertions or deletions of genetic material that would allow for editing and correcting certain abnormalities in genes. The Company owns or licenses over 230 patents worldwide. For more information visit our website www.enzo.com. Except for historical information, the matters discussed in this news release may be considered "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include declarations regarding the intent, belief or current expectations of the Company and its management. Investors are cautioned that any such forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. are not guarantees of future performance and involve a number of risks and uncertainties that could materially affect actual results. The Company disclaims any obligations to update any forward-looking statement as a result of developments occurring after the date of this press release. An informational call conducted by Enzo Biochem, Inc. management will take place on Tuesday, March 15, 2005 at 8:30 AM E.T. It can be accessed by dialing 1-800-322-0079. International callers can dial 1-973-935-2100. You may also listen over the Internet at www.vcall.com. To listen to the live call on the Internet, please go to the web site at least fifteen minutes early to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available approximately two hours after the end of the live call, through midnight (ET) on Tuesday, March 29, 2005. For replay, dial 1-877-519-4471 (1-973-341-3080 internationally). You will be prompted for PIN number 5802401.
ENZO BIOCHEM, INC.
SELECTED STATEMENT OF OPERATIONS DATA
Six Months Ended Three Months Ended
January 31, January 31,
2005 2004 2005 2004
(unaudited) (unaudited)
(In thousands except per share data)
Operating revenues $21,536 $21,300 $11,235 $11,028
Income (loss) before
(provision) benefit
for income taxes 11,228 (3,572) (944) (2,755)
(Provision) benefit for
income taxes (4,736) 1,793 416 1,300
-------- -------- ------- --------
Net income (loss) $6,492 $(1,779) $(528) $(1,455)
======== ======== ======= ========
Net income (loss) per share -
basic $0.20 $(0.06) ($ 0.02) $(0.05)
Net income (loss) per share -
diluted $0.20 $(0.06) ($ 0.02) $(0.05)
-------- -------- ------- --------
Common share - basic 32,062 31,523 32,076 31,538
Common share - diluted 32,739 31,523 32,076 31,538
SELECTED BALANCE SHEET DATA
January 31, 2005 July 31, 2004
(unaudited)
(in thousands)
Cash and Marketable Securities $81,572 $71,741
Working Capital $99,086 $92,260
Stockholders' Equity $110,979 $104,166
Total Assets $118,036 $110,334
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