Published on July 29, 2010
Exhibit
99.1
NEOGENOMICS,
INC.
PRESS
RELEASE
FOR
IMMEDIATE RELEASE
NeoGenomics
Reports Second Quarter 2010 Results
Ft. Myers, Florida – July 29, 2010 -
NeoGenomics, Inc. (NASD OTC BB: NGNM), a leading provider of
cancer-focused genetic testing services today reported its results
for the second quarter 2010.
Second Quarter 2010
Highlights:
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Revenue growth of 14% vs. Q2
09
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Test volume growth of 28% vs.
Q2 09
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Contracts with two managed care
providers signed
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Revenue
for the three months ended June 30, 2010 was $8.5 million, a 14% increase over
the $7.5 million reported in the second quarter 2009. Test volume
increased by 28% over the comparable quarter last year. Sales and
marketing expenses increased by $221,000, or 13% over last year, driven
primarily by an increase in the number of sales representatives and sales
recruiting expenses. General and administrative expenses increased by
$554,000, or 25%, primarily as a result of additional management and information
technology personnel. Net loss for the quarter was ($978,000) or
($0.03)/share versus net income of $8,000 or $0.00/share in the second quarter
2009.
After adjusting for the impacts caused
by internalization of bladder cancer FISH testing by the Company’s largest
client beginning in mid 2009, revenue and test volume from all other clients
grew by approximately 24% and 39%, respectively.
Second
quarter revenue growth was impacted by continued pressure on average revenue per
test, which was down approximately 11% versus the second quarter 2009.
Approximately 60% of this decrease was due to reductions in insurance
reimbursements with the remaining 40% due to changes in test mix.
Doug
VanOort, the Company’s Chairman and CEO, commented, “NeoGenomics continued to
invest in initiatives to drive and accelerate sustainable growth.
Improving the productivity of our sales force, introducing new products, and
implementing a new laboratory information system were important activities
during the quarter. However, both revenue and profitability were affected
by significant reductions in average price.”
1
Mr.
VanOort went on to say, “Becoming an “in-network” provider with managed care
plans has been an important part of our sales and marketing strategy.
Although there is downward price pressure up front, becoming an “in-network” lab
eliminates the pressure our clients receive from managed care companies to
curtail their use of out-of-network laboratories. It also eliminates
clinicians’ concerns about potential laboratory billing practices, because
working with an “in-network” lab provides them with certainty that their
patients will only be billed for legitimate co-pays, deductibles and
co-insurance. Thus, we believe that becoming an “in-network” provider will
result in significant sales and marketing advantages and create additional
revenue opportunities with both existing and new clients over
time.”
Mr.
VanOort concluded, “During the quarter we amended an important contract with
Blue Cross/Blue Shield to allow access to several additional plans. We
also signed a national contract with Aetna, which became effective on July
15th.
Since we are now an in-network provider with our three largest insurance payers,
less than 10% of our total revenue remains exposed to further negotiated price
reductions as a result of additional managed care contracts. As a result,
we believe most of the impact from managed care price reductions is now
incorporated into our financials, and we expect average revenue per test to
stabilize in coming quarters.”
Conference
Call
The
Company has scheduled a web-cast and conference call to discuss their Q2 2010
results on July 29, 2010, at 11:00 AM EDT. Interested investors should
dial (877) 407-9210 (domestic) and (201) 689-8049 (international) at least five
minutes prior to the call. A replay of the conference call will be
available until 11:59 PM on August 6, 2010 and can be accessed by dialing (877)
660-6853 (domestic) and (201) 612-7415 (international). The playback
account number is 354290 and the playback conference ID Number/PIN Number is
286. The web-cast may be accessed under the Investor Relations section of
our website at http://www.neogenomics.com
or http://www.investorcalendar.com/IC/CEPage.asp?ID=160682.
An archive of the web-cast will be available until 11:59 PM EDT on October 29,
2010.
About
NeoGenomics, Inc.
NeoGenomics,
Inc. is a high-complexity CLIA–certified clinical laboratory that specializes in
cancer genetics diagnostic testing, the fastest growing segment of the
laboratory industry. The company’s testing services include cytogenetics,
fluorescence in-situ hybridization (FISH), flow cytometry, morphology studies,
anatomic pathology and molecular genetic testing. Headquartered in Fort
Myers, FL, NeoGenomics has labs in Nashville, TN, Irvine, CA and Fort Myers and
services the needs of pathologists, oncologists, urologists, and hospitals
throughout the United States. For additional information about NeoGenomics,
visit http://www.neogenomics.com.
For more
news and information on NeoGenomics, please visit www.IRGnews.com/coi/NGNM where you can
find a fact sheet on the company, investor presentations, and more. Interested
parties can also access additional investor relations material, including an
investment profile and an equity research report, from Hawk Associates at http://www.hawkassociates.com
or from the American Microcap Institute at http://www.americanmicrocapinstitute.com/ngnm/.
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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, Actual results
could differ materially from such statements expressed or implied herein.
Factors that might cause such a difference include, among others, the company’s
ability to continue gaining new customers, offer new types of tests, and
otherwise implement its business plan. As a result, this press release should be
read in conjunction with the company's periodic filings with the
SEC.
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For
further information, please contact:
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NeoGenomics,
Inc.
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The
Investor Relations Group
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Steven
C. Jones
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Investor
Relations:
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Director
of Investor Relations
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Dillon
Heins
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(239)
325-2001
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(212)
825-3210
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sjones@neogenomics.com
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dheins@investorrelationsgroup.com
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Hawk
Associates, Inc.
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Media
Relations:
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Ms.
Julie Marshall
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Janet
Vasquez
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(305)-451-1888
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(212)
825-3210
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neogenomics@hawkassociates.com
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jvasquez@investorrelationsgroup.com
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3
NeoGenomics,
Inc.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(in
thousands, except share data)
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June 30, 2010
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December 31,
2009
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(unaudited)
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ASSETS
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Cash,
cash equivalents
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$ | 2,177 | $ | 1,631 | ||||
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Restricted
Cash
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500 | 1,000 | ||||||
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Accounts Receivable
(net of allowance for doubtful
accounts of $933 and $589, respectively)
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5,385 | 4,632 | ||||||
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Other
Current Assets
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1,460 | 1,257 | ||||||
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TOTAL
CURRENT ASSETS
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9,522 | 8,520 | ||||||
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PROPERTY AND EQUIPMENT
(net of accumulated depreciation of $3,624 and $2,787,
respectively)
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5,042 | 4,340 | ||||||
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OTHER
ASSETS
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87 | 85 | ||||||
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TOTAL
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$ | 14,651 | $ | 12,945 | ||||
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LIABILITIES AND STOCKHOLDERS’
EQUITY
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CURRENT
LIABILITIES
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$ | 8,832 | $ | 5,776 | ||||
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LONG
TERM LIABILITIES
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1,436 | 1,526 | ||||||
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TOTAL
LIABILITIES
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10,268 | 7,302 | ||||||
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STOCKHOLDERS’
EQUITY
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4,383 | 5,643 | ||||||
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TOTAL
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$ | 14,651 | $ | 12,945 | ||||
4
NEOGENOMICS,
INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(in
thousands, except per share amounts)
(unaudited)
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For the Three-Months Ended
June 30,
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For the Six-Months Ended
June 30,
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2010
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2009
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2010
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2009
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NET
REVENUE
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$ | 8,490 | $ | 7,459 | $ | 16,908 | $ | 14,373 | ||||||||
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COST
OF REVENUE
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4,575 | 3,384 | 8,918 | 6,475 | ||||||||||||
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GROSS
PROFIT
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3,915 | 4,075 | 7,990 | 7,898 | ||||||||||||
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OPERATING
EXPENSES
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General
and administrative
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2,769 | 2,215 | 5,671 | 4,555 | ||||||||||||
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Sales
and marketing
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1,943 | 1,722 | 3,706 | 3,056 | ||||||||||||
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Total
operating expenses
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4,712 | 3,937 | 9,377 | 7,612 | ||||||||||||
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INCOME
(LOSS) FROM OPERATIONS
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(797 | ) | 138 | (1,387 | ) | 286 | ||||||||||
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INTEREST
AND OTHER INCOME (EXPENSE) - NET
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(181 | ) | (130 | ) | (341 | ) | (245 | ) | ||||||||
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NET
INCOME (LOSS)
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$ | (978 | ) | $ | 8 | $ | (1,728 | ) | $ | 41 | ||||||
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NET
INCOME (LOSS) PER SHARE
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Basic
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$ | (0.03 | ) | $ | 0.00 | $ | (0.05 | ) | $ | 0.00 | ||||||
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Diluted
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$ | (0.03 | ) | $ | 0.00 | $ | (0.05 | ) | $ | 0.00 | ||||||
| WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | ||||||||||||||||
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Basic
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37,307,232 | 33,066,941 | 37,264,112 | 32,655,972 | ||||||||||||
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Diluted
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37,307,232 | 38,485,914 | 37,264,112 | 36,864,793 | ||||||||||||
The
accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.
5
NeoGenomics,
Inc.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in
thousands)
(unaudited)
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For the
Six Months
Ended
June 30, 2010
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For the
Six Months
Ended
June 30, 2009
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NET
CASH USED IN OPERATING ACTIVITIES
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$ | (1,488 | ) | $ | (533 | ) | ||
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NET
CASH USED IN INVESTING ACTIVITIES
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(500 | ) | (139 | ) | ||||
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NET
CASH PROVIDED BY FINANCING ACTIVITIES
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2,534 | 902 | ||||||
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NET
INCREASE IN CASH AND CASH EQUIVALENTS
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546 | 230 | ||||||
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CASH
AND CASH EQUIVALENTS, BEGINNING OF PERIOD
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1,631 | 468 | ||||||
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CASH
AND CASH EQUIVALENTS, END OF PERIOD
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$ | 2,177 | $ | 698 | ||||
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SUPPLEMENTAL
DISCLOSURE OF CASH FLOW INFORMATION:
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Interest
paid
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$ | 314 | $ | 214 | ||||
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Income
taxes paid
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$ | 6 | $ | - | ||||
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SUPPLEMENTAL
DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:
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Equipment
leased under capital lease and equipment loans
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$ | 1,103 | $ | 686 | ||||
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Equipment
purchased and included in accounts payable
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$ | - | $ | 5 | ||||
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Equipment
purchased and payables settled with issuance of restricted common
stock
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$ | - | $ | 186 | ||||
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NeoGenomics,
Inc.
Supplemental
Information on Customer Requisitions Received and Tests Performed
(in
thousands, except test and requisition amount)
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For the
Three-
Months
Ended
June 30,
2010
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For the
Three-
Months
Ended
June 30,
2009
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% Inc
(Dec)
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For the
Six-
Months
Ended
June 30,
2010
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For the
Six-
Months
Ended
June 30,
2009
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% Inc
(Dec)
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Requisitions
Rec’d (cases)
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9,576 | 7,829 | 22.3 | % | 19,156 | 15,510 | 23.5 | % | ||||||||||||||||
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Number
of Tests Performed
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14,464 | 11,316 | 27.8 | % | 28,506 | 21,773 | 30.9 | % | ||||||||||||||||
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Avg.
# of Tests / Requisition
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1.51 | 1.45 | 4.1 | % | 1.49 | 1.40 | 6.4 | % | ||||||||||||||||
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Total
Testing Revenue
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$ | 8,490 | $ | 7,459 | 13.8 | % | $ | 16,908 | $ | 14,373 | 17.6 | % | ||||||||||||
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Avg
Revenue/Requisition
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$ | 886.60 | $ | 952.78 | (6.9 | )% | $ | 882.67 | $ | 926.68 | (4.7 | )% | ||||||||||||
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Avg
Revenue/Test
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$ | 586.98 | $ | 659.18 | (11.0 | )% | $ | 593.15 | $ | 660.12 | (10.1 | )% | ||||||||||||
7