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Interleukin Genetics Reports Third Quarter 2012 Financial Results

Wednesday, November 14, 2012 4:20 PM


Interleukin Genetics, Inc. (OTCQB: ILIU) today announced financial and operational results for the third quarter ended September 30, 2012.

Total revenue for the three months ended September 30, 2012 was $420,000, compared to $765,000 for the same period in the prior year. The decrease was primarily attributable to a decrease in genetic tests returned and processed and lower sales of our Inherent Health® brand of genetic tests through our Merchant Network and Channel Partner Agreement with Amway Global. Cash received from genetic test sales is reflected as deferred revenue until the test report is issued. Deferred revenue increased $146,000 to $971,000 at September 30, 2012 as compared to December 31, 2011.

Research and development expenses were $246,000 for the three months ended September 30, 2012, compared to $325,000 for the same period in the prior year. The decrease was primarily attributable to lower consulting costs partially offset by increased compensation costs.

Selling, general, and administrative expenses were $1.0 million for the three months ended September 30, 2012, compared to $1.1 million for the same period in the prior year. The decrease was primarily attributable to lower patent related legal fees, insurance, consulting and sales commissions paid to Amway partially offset by increased professional fees and employee separation costs.

The Company reported a net loss of $1.3 million, or $(.03) per basic and diluted common share, for the third quarter of 2012 compared to $1.1 million, or $(.03) per basic and diluted common share, for the same period in 2011. On September 30, 2012, the Company had cash and cash equivalents of $2.5 million.

The Company expects that its current and anticipated financial resources are adequate to maintain current and planned operations at least through November 30, 2012, the due date of its credit facility with Pyxis Innovations, Inc., and through March 31, 2013 if the due date of the credit facility is extended. Management is in discussions with Pyxis to extend this due date. The Company’s independent registered public accounting firm has included an explanatory paragraph in their opinion in connection with the 2011 audit, relating to the Company's ability to continue as a going concern.

“We are encouraged by the positive top line results received from the University of Michigan study that employed our PST® test. The results of the study should provide the evidence to support broader use of this test to both improve preventive dental care and favorably influence healthcare costs. We are now focused on ramping up the broad commercialization of our PST genetic test for improved management of dental patients,” said Kenneth S. Kornman, Chief Executive Officer of Interleukin Genetics.

Conference Call and Webcast Information

Interleukin Genetics will host a live conference call and webcast today at 4:30 p.m. EST to review the Company’s new business developments and third quarter financial results. To access the live call, dial 877-324-1976 (domestic) or 631-291-4550 (international). The live webcast and replay access will be available on the Investors section of the Company’s Website at: www.ilgenetics.com.

About Interleukin Genetics, Inc.

Interleukin Genetics, Inc. (OTCQB: ILIU) develops and markets a line of genetic tests under the Inherent Health® and PST® brands. The products empower individuals to prevent certain chronic conditions and manage their existing health and wellness through genetic-based insights with actionable guidance. Interleukin Genetics leverages its research, intellectual property and genetic panel development expertise in metabolism and inflammation to facilitate the emerging personalized healthcare market. The Company markets its tests through partnerships with health and wellness companies, healthcare professionals and other distribution channels. Interleukin Genetics’ flagship products include its proprietary PST® genetic risk panel for periodontal disease and tooth loss susceptibility available through health care professionals, and the Inherent Health Weight Management Genetic Test that identifies the most effective diet and exercise program for an individual based on genetics. Interleukin Genetics is headquartered in Waltham, Mass. and operates an on-site, state-of-the-art DNA testing laboratory certified under the Clinical Laboratory Improvement Amendments (CLIA). For more information please visit www.ilgenetics.com.

Certain statements contained herein are “forward-looking” statements, including statements relating to the sufficiency of the Company’s current and anticipated financial resources and the extension of the due date of the Company’s credit facility. Because such statements include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements include, but are not limited to, those risks and uncertainties described in the Company’s annual report on Form 10-K for the year ended December 31, 2011 and other filings with the Securities and Exchange Commission. The Company disclaims any obligation or intention to update these forward-looking statements.

 
INTERLEUKIN GENETICS, INC.
FINANCIAL HIGHLIGHTS
         
Balance Sheet Data : (Unaudited) September 30, December 31,

2012

2011

Cash and cash equivalents $ 2,489,156 $ 1,728,222
Other current assets $ 396,254 $ 383,699
Non-current assets $ 621,297   $ 841,596  
Total assets $ 3,506,707   $ 2,953,517  
 
Total current liabilities $ 15,962,141 $ 14,376,748
Total liabilities $ 15,962,141 $ 14,376,748
 
Total stockholders' deficit $ (12,455,434 ) $ (11,423,231 )
   
Total liabilities and stockholders' deficit $ 3,506,707   $ 2,953,517  
 
 
Statement of Operations Data (Unaudited): Three Months Ended September 30, Nine Months Ended September 30,

2012

2011

2012

2011

Revenue:
Genetic testing service revenue $ 383,064 $ 731,194 $ 1,837,781 $ 2,229,757
Other   36,947     34,222     59,550     52,008  
Total revenue 420,011 765,416 1,897,331 2,281,765
Cost of revenue   271,430     370,740     1,040,764     1,166,793  
Gross profit 148,581 394,676 856,567 1,114,972
 
Operating expenses:
Research and development 245,736 324,669 1,009,449 989,287
Selling, general and administrative 1,044,567 1,086,606 3,357,327 3,542,203
Amortization of intangibles   28,863     28,863     86,590     86,590  
Total operating expenses   1,319,166     1,440,138     4,453,366     4,618,080  
Loss from operations   (1,170,585 )   (1,045,462 )   (3,596,799 )   (3,503,108 )
 
Total other expense, net   (115,639 )   (89,080 )   (333,966 )   (257,778 )
 
Loss before income taxes (1,286,224 ) (1,134,542 ) (3,930,765 ) (3,760,886 )
Benefit for income taxes   -     -     -     -  
Loss from continuing operations   (1,286,224 )   (1,134,542 )   (3,930,765 )   (3,760,886 )

Income from discontinued operations, net of income taxes

  -     -     -     158,366  
Net loss $ (1,286,224 ) $ (1,134,542 ) $ (3,930,765 ) $ (3,602,520 )
 
Basic and diluted net loss per common share from:
Continuing operations $ (0.03 ) $ (0.03 ) $ (0.11 ) $ (0.10 )
Discontinued operations   -     -     -     0.00  
Net loss $ (0.03 ) $ (0.03 ) $ (0.11 ) $ (0.10 )

Weighted average common shares outstanding, basic and diluted

  36,756,864     36,674,829     36,753,942     36,647,874  

(Source: Business Wire )
(Source: Quotemedia)

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