Epigenomics AG Reports Financial Results for Fiscal Year 2004

Epigenomics AG Reports Financial Results for Fiscal Year 2004



BERLIN, March 23  /PRNewswire-FirstCall/ -- Epigenomics AG (Frankfurt, Prime
Standard: ECX), a molecular diagnostics company developing tests based on DNA
methylation, today reported its financial results for the fiscal year ending
December 31, 2004.

  Financial Highlights

  * Successfully completed Initial Public Offering on July 19 raising
    EUR41.6 million (gross)
  * Revenues amounted to EUR7.9 million, in line with expectations
  * EBIT increased to (EUR9.9) million, in line of expectations
  * Significant increase in liquidity with EUR41 million available
  * No long-term debt

  Operational Highlights

  * Successfully identified DNA methylation biomarkers for all current
    products in collaboration with Roche Diagnostics
  * Signed oncology pharmacodiagnostic collaborations with AstraZeneca and
    Biogen Idec as well as Pfizer as a new customer
  * Initiated proprietary product development
  * Presented positive data from clinical study using DNA biomarkers for
    predicting disease recurrence in breast cancer patients at ASCO



During 2004, Epigenomics made significant progress on several fronts. The
company successfully listed on the Frankfurt Stock Exchange raising EUR41.6
million. Its diagnostic product development is progressing well, with all the
initial milestones in each of the five product programs having been met. The
company reported very successful implementation of its business strategy,
signing pharmacodiagnostic collaborations with both AstraZeneca and Biogen
Idec, and also adding Pfizer as a customer in 2004. The progress with
Epigenomics' product development is expected to continue into 2005 and beyond.
Much emphasis has been placed on running the clinical development and
validation of lead products. Epigenomics still anticipates clinical data from
the breast cancer treatment response and colon cancer screening products to be
available by the end of 2005.

Financial Review 2004

In July 2004, Epigenomics became the first biotech company in Germany to
successfully complete an Initial Public Offering (IPO) in over three years.
Based on strong fundamentals and a unique position within the molecular
diagnostics industry, Epigenomics was able to raise a total of EUR41.6 million
(gross), which will be utilized mainly to further advance proprietary product
development.

Full year 2004 revenues were in line with guidance at EUR7.9 million compared
with EUR10.8 million in 2003. The decrease in revenue was mainly associated
with the timing of key milestone payments from the Roche Diagnostics
collaboration. Some milestones that occurred in 2003 did not reoccur 2004.

Total operating expenses for 2004 rose slightly to EUR19.0 million from EUR18.4
million in the previous year. The increase was as a result of costs associated
with the transition from private to public company and higher expenses due to
extended use of patient samples in commercial projects.

Committed towards maintaining a leadership position in DNA methylation
products, science and technology, we incurred slightly higher research and
development (R&D) expenditures in 2004 of EUR7.8 million compared to 2003 with
EUR7.6 million. As well as improving the overall R&D infrastructure within the
company, the dedicated efforts in this area were rewarded with a significant
strengthening of our IP portfolio. A total of 16 patents were granted bringing
the total to 32. General and administrative expenses increased from EUR3.2
million in 2003 to EUR3.7 million in 2004, mostly due to costs associated with
being a public company.

Earnings before interest and taxes (EBIT) was EUR(9.9) million in 2004 compared
to EUR(6.3) million the year before. Net loss for 2004 increased by 56% to
EUR(10.5) million from EUR(6.7) million in 2003. The increase in net loss also
included significant one-time effects from the IPO. Basic loss per share was
almost identical at EUR(0.76) and EUR(0.79), for 2004 and 2003, respectively,
but based on very different average numbers of shares outstanding.

As of December 31, 2004, cash, cash equivalents, short-term investments and
marketable securities totalled EUR41.0 million compared with EUR19.4 million at
the end of 2003. The net cash burn [= cash flow (CF) from operations plus CF
from investments in tangible and intangible assets but excluding investments
for treasury purposes] was EUR(9.5) million for 2004 compared to EUR(7.1)
million in 2003. The number of outstanding shares as of December 31, 2004 was
16,334,229.

Future Outlook

In the next 12 to 24 months, Epigenomics believes it will continue meeting the
milestones detailed in the SBU Diagnostics collaboration with Roche
Diagnostics. The company also expects to deliver results from pharma technology
partnerships. With this in mind, Epigenomics anticipates to increase revenues
slightly to the range of EUR8.5 to 10.0 million for full-year 2005. As in 2004,
revenues will depend on the successful delivery of milestones from current
partnerships, in particular with Roche Diagnostics. EBIT for FY 2005 is
expected to be between EUR(10.5) and EUR(12.0) million. Net cash burn is
anticipated to be between EUR(11.0) to EUR (13.0) million, however this amount
may fluctuate considerably depending on the timing of milestone payments.
Liquidity for year end 2005 is expected to be within the range of EUR 28.0 to
EUR30.0 million.

Epigenomics will host an analyst meeting (English language) today in Frankfurt
at 9 AM/CET followed by a press conference (German language) at 11 AM/CET to
present the fiscal year 2004 results and provide guidance for 2005. An
accompanying presentation will be available for download on the Epigenomics
website ( http://www.epigenomics.com/ ).

Epigenomics' management will also host a conference call at 3 PM/CET. The
dial-in number for the conference call (listen only mode) is: 

  [phone] for European participants, and
  [phone] for US participants.


A recording of the conference call will be provided for two weeks on
Epigenomics' website subsequently.

VC Board Members to Step Down By First Annual Shareholder Meeting

As anticipated, three members of the company's Supervisory Board, Drs. Klaus
Stockemann, Jorg Neerman and Michael Steinmetz have tendered their resignation
to the Management Board. With the departure of these VC representatives,
Epigenomics has already identified three highly qualified candidates with
extensive diagnostic and pharmaceutical industry and commercial experience. The
candidates, whose background will play an important role in the next stage of
Epigenomics' corporate development, will be put forth after nomination.

Epigenomics would like to thank Drs. Klaus Stockemann, Jorg Neerman and Michael
Steinmetz for their long and continued support of Epigenomics. Their expertise
has been a considerable asset as the company transitioned from an early
start-up through the IPO and beyond.

About Epigenomics

Epigenomics is a molecular diagnostics company with a focus on the development
of novel products for cancer. By detecting and interpreting DNA methylation
patterns, Epigenomics' tests can potentially diagnose disease at an early stage
and help guide physicians to select an appropriate therapy. Epigenomics
collaborates with Roche Diagnostics on the development of several diagnostic
products in cancer. The company has its headquarters in Berlin, Germany, and a
wholly owned subsidiary in Seattle, USA. For more information, please visit our
website at http://www.epigenomics.com/ .

Disclaimer

This communication expressly or implicitly contains certain forward-looking
statements concerning Epigenomics AG and its business. Such statements involve
certain known and unknown risks, uncertainties and other factors which could
cause the actual results, financial condition, performance or achievements of
Epigenomics AG to be materially different from any future results, performance
or achievements expressed or implied by such forward-looking statements.
Epigenomics AG is providing this communication as of this date and does not
undertake to update any forward-looking statements contained herein as a result
of new information, future events or otherwise.

(c)DGAP 23.03.2005

WKN: A0BVT9; ISIN: DE000A0BVT96; Index: Listed: Amtlicher Markt in Frankfurt
(Prime Standard); Freiverkehr in Berlin- Bremen, Dusseldorf, Hamburg, Munchen
und Stuttgart

http://www.dgap.de/ 

DATASOURCE: Epigenomics AG



CONTACT:  Henrik Adelmann, DGAP Deutsche Gesellschaft für Ad

hoc-Publizität mbH, Phone: [phone], Fax:

[phone], Email: 

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