SDIX Reports Third Quarter 2010 Results

  SDIX Reports Third Quarter 2010 Results

        Revenues Increase to $7.5M, Net Loss Decreases 90% to $29,000.

Business Wire

NEWARK, Del. -- November 08, 2010

SDIX (Nasdaq: SDIX), a leading provider of biotechnology-based products and
services for a broad range of life science, biotechnology, diagnostic and food
safety applications, today reported financial results for the third quarter of
2010.

Revenues for the quarter ended September 30, 2010 were $7.5 million, compared
to $7.2 million for the same period in 2009. Year-to-date revenues were $21.0
million, which was equivalent to the same period in 2009. Net loss decreased
to $29,000 as gross margins continue to be strong.

Third Quarter and Recent Highlights

  *Launched RapidChek® SELECT™ Salmonella Enteritidis testing system -
    applicable to both egg and poultry industries, and designed to help U.S.
    commercial egg producers comply with new FDA testing regulations. Expect
    to receive AOAC clearance in the fourth quarter, a required approval for
    most egg producers.
  *Signed and launched multi-year collaboration with Banyan Biomarkers in its
    biomarker discovery work in the detection of traumatic brain injury –
    collaboration will focus on the development, production and purification
    of monoclonal and polyclonal antibodies and will provide cell line banking
    and cryostorage services.
  *Signed and initiated a distribution agreement with Romer Labs® Inc. for
    SDIX’s Genetically Modified Organisms (GMO) rapid testing products - Romer
    Labs® is now the exclusive global distributor outside of Brazil for
    TraitChek® and SeedChek® GMO test strip products.

Mr. Francis DiNuzzo, SDIX’s President and CEO, said, “We continue to see
results from our strategic focus on the Life Science and Food Safety markets,
with continued quarter over quarter revenue growth in our overall business.
This improving growth, combined with the efficiency of our business
operations, allowed SDIX to operate near break even this quarter. We are
seeing the benefits of our efforts to deliver value to customers across our
business segments with improved performance in Food Safety, Water Quality and
AG. Consistent with our previous comments, the Life Science business results
often vary quarter to quarter due to buying patterns, especially in the
in-vitro diagnostic (IVD) market. We expect our Life Science business,
including the IVD business, to improve in the fourth quarter as compared to
the fourth quarter of 2009 based on current activities within that customer
base. Looking forward to the fourth quarter, we anticipate receiving approval
for our Salmonella Enteritidis product line from the AOAC, which is a leading
independent testing organization. This approval will provide validity of our
test system relative to the standard FDA method of testing for the egg
industry, which we expect to provide confidence to customers that our system
meets their needs and regulatory requirements.”

Financials

Gross profit (defined as total revenues less manufacturing expenses) for the
quarter ended September 30, 2010 was $4.5 million, as compared to $4.1 million
for the same period in 2009. Year-to-date gross profit was $12.4 million in
2010, compared to $11.5 million for 2009.

Gross margins were 60% for the third quarter of 2010, compared to 57% for the
same period in 2009. Gross margins for the nine months ended September 30,
2010 were 59% compared to 55% for the same period in 2009.

Operating loss for the third quarter of 2010 decreased 93% to $20,000 from
$281,000 for the third quarter of 2009. Operating loss for the nine months of
2010 fell 58% to $668,000 from $1.6 million for the nine months of 2009.

Net loss for the third quarter of 2010 fell 90% to $29,000, or $0.00 per
diluted share, compared to a net loss of $291,000, or $0.01 per diluted share,
for the same period in 2009. For the nine month period ended September 30,
2010, the net loss was $703,000, or $0.03 per diluted share, compared to a net
loss of $1.6 million, or $0.08 per diluted share, for the same period in 2009.

Life Science Revenues

Life Science revenues were $3.7 million for the quarter ended September 30,
2010, a 13% decrease from $4.3 million for the same period in 2009. For the
nine months ended September 30, 2010, Life Science revenues decreased 1% to
$11.2 million compared to $11.3 million for the same period in 2009.

Kit Revenues

Kit revenues increased 28% to $3.8 million for the third quarter ended
September 30, 2010, from $2.9 million for the third quarter of 2009. For the
nine months ended September 30, 2010, Kit revenues increased 1% to $9.7
million compared to $9.6 million for the same period in 2009.

                                                           
Quarter Ended September 30,                 2010            2009
                                                                  
Life Science                                   $3.7 million       $4.3 million
Food Pathogen Products                         $1.6 million       $1.4 million
Ag-GMO Products, including contract            $0.7 million       $0.4 million
revenue
Water and Environmental Products               $1.5 million       $1.1 million
                                                                  

Conference Call

The dial-in number for our live conference call, to be held at 4:30 p.m. ET on
November 8, 2010, will be 877-407-9205 (201-689-8054 outside the U.S.). A live
webcast of the conference call will be available on the Company’s website,
www.sdix.com, as well as www.investorcalendar.com. For those who cannot listen
to the live broadcast, an audio replay of the call will be available on each
of these websites for 90 days. Telephone replays of the call will be available
from 7:30 p.m. ET on November 8, 2010 through 11:59 p.m. ET on November 22,
2010. To listen to the telephone replay, dial 877-660-6853 (201-612-7415
outside the U.S.) and enter account number 286 and conference ID 360336.

About SDIX  (www.sdix.com)

SDIX is a biotechnology company, expert at creating advantage by providing a
broad range of quality, innovative and effective immuno-solutions to the
pharmaceutical, biotechnology, diagnostics, and food safety markets. For
nearly 20 years, SDIX has developed antibodies which advance its customers’
immuno-based work – reducing time, labor, and costs while increasing accuracy
and reliability of results.

SDIX offers a full suite of integrated immuno-solution capabilities including
assay design, development, and production. In life science markets, SDIX
capabilities are being used to help discover the mechanisms of disease,
facilitate the development of new drugs, and provide mechanisms for rapid
diagnosis.

This news release may contain forward-looking statements reflecting SDIX's
current expectations. When used in this press release, words like
“anticipate”, “could”, “enable”, “estimate”, “intend”, “expect”, “believe”,
“potential”, “will”, “should”, “project”, “plan” and similar expressions as
they relate to SDIX are intended to identify said forward-looking statements.
Investors are cautioned that all forward-looking statements involve risks and
uncertainties, which may cause actual results to differ from those anticipated
by SDIX at this time. Such risks and uncertainties include, without
limitation, changes in demand for products, the application of our
technologies to various uses, delays in product development, delays in market
acceptance of new products, retention of customers and employees, adequate
supply of raw materials, inability to obtain or delays in obtaining fourth
party, or required government approvals, the ability to meet increased market
demand, competition, protection of intellectual property, non-infringement of
intellectual property, seasonality, and other factors more fully described in
SDIX's public filings with the U.S. Securities and Exchange Commission.


STRATEGIC DIAGNOSTICS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share data)
(unaudited)


                 Three Months                        Nine Months
                Ended September 30,                   Ended September 30,
                2010             2009               2010             2009
                                                                       
Revenues         $ 7,473           $ 7,196           $ 20,960          $ 20,951     
                                                                                         
OPERATING
EXPENSES:
Manufacturing        3,015              3,083              8,534              9,403
Research and         767                752                2,207              2,235
development
Selling,
general and          3,711              3,642              10,895             10,886
administrative
Gain on
disposal of       -                -                (8         )      -          
assets
Total
operating         7,493            7,477            21,628           22,524     
expenses
                                                                                         
Operating loss       (20        )       (281       )       (668       )       (1,573     )
                                                                                         
Interest             (9         )       (9         )       (35        )       (4         )
expense, net
                                                                           
                                                                                         
Loss before          (29        )       (290       )       (703       )       (1,577     )
taxes
                                                                                         
Income tax           -                  1                  -                  9
expense
                                                                           
                                                                                         
Net loss          (29        )      (291       )      (703       )      (1,586     )
                                                                                         
Basic loss per   $ (0.00      )     $ (0.01      )     $ (0.03      )     $ (0.08      )
share
                                                                                         
Shares used in
computing         20,289,602       20,151,694       20,236,462       20,098,311 
basic loss per
share
                                                                                         
Diluted loss     $ (0.00      )     $ (0.01      )     $ (0.03      )     $ (0.08      )
per share
                                                                                         
Shares used in
computing         20,289,602       20,151,694       20,236,462       20,098,311 
diluted loss
per share
                                                                                         


STRATEGIC DIAGNOSTICS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(unaudited)


                                              September 30,   December 31,
                                             2010            2009
ASSETS
Current Assets:
Cash and cash equivalents                       $  8,438          $  7,937
Restricted cash                                    800               1,250
Receivables, net                                   4,175             3,650
Inventories                                        3,572             3,714
Deferred tax asset                                 1                 1
Other current assets                            595           551     
Total current assets                            17,581        17,103  
                                                                             
Property and equipment, net                        4,294             4,626
Other assets                                       62                10
Deferred tax asset                                 51                51
Intangible assets, net                          1,349         1,435   
Total assets                                  $  23,337      $  23,225  
                                                                             
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt               $  400            $  400
Accounts payable                                   515               571
Accrued expenses                                   2,170             1,386
Deferred revenue                                9             75      
Total current liabilities                       3,094         2,432   
                                                                             
Long-term debt                                  400           700     
                                                                             
Stockholders' Equity:
Preferred stock, $.01 par value, 20,920,648
shares authorized, no shares issued or             -                 -
outstanding
Common stock, $.01 par value, 35,000,000
shares authorized, 20,923,463 and                  209               208
20,786,515 issued at September 30, 2010 and
December 31, 2009, respectively
Additional paid-in capital                         41,418            40,958
Treasury stock, 406,627 common shares at
cost at September 30, 2010 and December 31,        (555     )        (555    )
2009
Accumulated deficit                                (20,979  )        (20,276 )
Cumulative translation adjustments              (250     )     (242    )
Total stockholders' equity                      19,843        20,093  
Total liabilities and stockholders' equity    $  23,337      $  23,225  
                                                                             

Contact:

SDIX
Kevin Bratton, VP and CFO, 302-456-6789
kbratton@sdix.com
 
Press spacebar to pause and continue. Press esc to stop.