Cellular Dynamics International Reports Fourth Quarter and Fiscal Year 2013 Financial Results

Cellular Dynamics International Reports Fourth Quarter and Fiscal Year 2013
Financial Results

MADISON, Wis., March 10, 2014 (GLOBE NEWSWIRE) -- Cellular Dynamics
International, Inc. (CDI) (Nasdaq:ICEL), a developer and manufacturer of fully
functioning human cells in industrial quantities to precise specifications,
today reported financial results for the fourth quarter and for the fiscal
year ended December 31, 2013.

"We continue to be pleased with the revenue growth of the company. Total
revenues for the fiscal year ended December 31, 2013, increased 81% when
compared to last year and average sales to our top 10 customers increased by
87% over the same period," said Bob Palay, Chairman and CEO of CDI.

"A growing number of pharmaceutical, biotech and CRO companies are adopting
CDI's products for their research programs. During the year ended December 31,
2013, CDI sold to 150 customers up from 128 for the year ended December 31,
2012. Our top 10 customers averaged $830,000 in revenue for the year ended
December 31, 2013, up from $445,000 for the same period last year. CDI
achieved an important milestone when one of its customers, Eli Lilly and
Company, generated over $2.0 million in revenue in a single year. In addition,
we also sold products to Nestle S.A. under our first supply agreement with a
world leading food company. We believe these results add to the growing
evidence that our iCell® and MyCell® products are becoming an industry
standard for manufactured human cells.

"Strategically, during the year CDI continued to make solid commercial
progress in selling into both the in vitro market with our growing portfolio
of iCell products and into the stem cell banking market. During the fourth
quarter we announced the $6.3 million contract with Coriell, which supplements
our existing $16 million project with the California Institute for
Regenerative Medicine (CIRM) to make iPS cell lines from 3,000 donors. Our
announced projects with the Jain Foundation and The Hamner Institutes for
Health Sciences provide further evidence of the traction we're getting with
our MyCell products within the stem cell banking market. All of these projects
take advantage of our proprietary episomal programming methodology, for which
we received an issued patent during the fourth quarter of 2013."

Fourth Quarter 2013 Selected Financial Results

Revenue. Total revenues for the fourth quarter of 2013 were $4.2 million
compared to $2.9 million for the fourth quarter of 2012, an increase of 41%.
Total revenues grew for three principal reasons: 1) increased unit sales of
the Company's iCell products, 2) significant increases in Collaborations,
partnerships and other revenues arising from our center of excellence
agreements with Eli Lilly and Company and AstraZeneca UK Limited, and 3) sales
of new cell types in early release testing with our customers. Lastly, we also
recognized our first revenues from our contract with CIRM.

Costs and expenses. Cost of product sales as a percentage of Product sales
declined from 54% in the fourth quarter of 2012 to 27% in the fourth quarter
of 2013.As a consequence, gross margin from product sales remained attractive
at 73% for the quarter.

Total costs and expenses (excluding Cost of product sales) were $9.8 million
for the fourth quarter of 2013 compared to $7.5 million for the fourth quarter
of 2012, an increase of 31%.This growth is attributable principally to an
increase in materials expense within our research and development
organization, an increase in staffing within our sales and marketing
organization and to general and administrative costs attributable to or
triggered by our initial public offering.

Net loss. For the fourth quarter of 2013, Net loss was $6.7 million, or $0.43
per share, compared with a Net loss of $5.8 million, or $3.35 per share, for
the fourth quarter of 2012.Weighted average shares outstanding for the fourth
quarter of 2013 was 15,756,363 versus 1,733,651 for the fourth quarter of
2012.The difference in weighted average shares outstanding is principally
attributable to both the common shares issued in our IPO and the conversion of
our Series A and Series B preferred stock to common shares immediately prior
to the consummation of our IPO.

Fiscal Year 2013 Results

Revenue. Total revenues for the year ended December 31, 2013, were $11.9
million compared to $6.6 million for the year ended December 31, 2012, an
increase of 81%. Growth in Total revenues is primarily attributable to growth
in unit sales of the Company's iCell products and significant increases in
Collaborations, partnerships and other revenues from our center of excellence
agreements with Eli Lilly and Company and AstraZeneca UK Limited and sales of
new cell types in early release testing with our customers.

Costs and expenses. Cost of product sales as a percentage of Product sales
declined from 40% for the year 2012 to 29% for the year 2013.Consequently,
gross margin from product sales increased from 60% for the year 2012 to 71%
for the year 2013.

Total costs and expenses (excluding Cost of product sales) were $33.8 million
for the year 2013 compared to $26.7 million for the year 2012, an increase of
27%.This growth is attributable principally to an increase in materials
expense within our research and development organization, an increase in
staffing within our sales and marketing organization and to general and
administrative costs attributable to or triggered by our initial public
offering.

Net loss. For the year 2013, Net loss was $25.0 million, or $3.17 per share,
compared with a Net loss of $22.3 million, or $12.89 per share, for the year
2012.Weighted average shares outstanding for the year 2013 was 7,878,060
versus 1,727,086 for 2012.The difference in weighted average shares
outstanding is principally attributable to both the common shares issued in
our IPO and the conversion of our Series A and Series B preferred stock to
common shares immediately prior to the consummation of our IPO.

Cash and cash equivalents.At December 31, 2013, Cash and cash equivalents
totaled $62.0 million.

Conference Call and Webcast

CDI will host a conference call and webcast at8:00 a.m. EDT,March 11, 2014.
The conference call may be accessed by dialing (877) 312-5886 for domestic
callers and (206) 453-2872 for international callers. Please specify to the
operator that you would like to join the Cellular Dynamics Fourth Quarter and
Fiscal Year 2013 Financial Results Call, or reference conference ID# 3865935.
The conference call also will be webcast live under the investor relations
section ofCDI's website at www.cellulardynamics.com, and will be archived
there for approximately one year.

About Cellular Dynamics International, Inc.

Cellular Dynamics International, Inc. (CDI) is a leading developer and
manufacturer of fully functioning human cells in industrial quantities to
precise specifications. CDI's proprietary iCell Operating System (iCell O/S)
includes true human cells in multiple cell types (iCell products), human
induced pluripotent stem cells (iPSCs) and custom iPSCs and iCell products
(MyCell Products). CDI's iCell O/S products provide standardized, easy-to-use,
cost-effective access to the human cell, the smallest fully functioning
operating unit of human biology. Customers use our iCell O/S products, among
other purposes, for drug discovery and screening; to test the safety and
efficacy of their small molecule and biologic drug candidates; for stem cell
banking; and in the research and development of cellular therapeutics. CDI was
founded in 2004 by Dr. James Thomson, a pioneer in human pluripotent stem cell
research at the University of Wisconsin-Madison. CDI's facilities are located
in Madison, Wisconsin, with a second facility in Novato, California. See
www.cellulardynamics.com.

Forward-looking Statements

To the extent that statements contained in this press release are not
descriptions of historical facts regarding Cellular Dynamics International,
Inc., including statements regarding our revenue growth and market acceptance
of our products, they are forward-looking statements reflecting the current
beliefs and expectations of management made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. Words such
as "may," "will," "believe," "expect," "anticipate," "estimate," "intend," and
similar expressions (as well as other words or expressions referencing future
events, conditions or circumstances) are intended to identify forward-looking
statements.Forward-looking statements in this release involve substantial
risks and uncertainties that could cause our product development efforts,
actual results, performance or achievements to differ materially from those
expressed or implied by the forward-looking statements. Cellular Dynamics
undertakes no obligation to update or revise any forward-looking statements.
For a further description of the risks and uncertainties that could cause
actual results to differ from those expressed in these forward-looking
statements, as well as risks relating to the business of the Company in
general, see Cellular Dynamics' Annual report on Form 10-K filed with the
Securities and Exchange Commission on March 10, 2014, which risks are
incorporated herein by reference, and as may be described from time to time in
Cellular Dynamics' subsequent SEC filings.

Cellular Dynamics International, Inc.
Balance sheets (Unaudited)
(Dollars in thousands, except per share    December 31, 2012 December 31, 2013
amounts)
Assets                                                      
Current assets:                                             
Cash and cash equivalents                  $33,900         $62,029
Accounts receivable, net                   2,658            3,318
Inventories                                2,381            3,884
Prepaid expenses and other assets          662              964
Total current assets                       39,601           70,195
Property and equipment,net                873              2,052
Goodwill                                   6,817            6,817
Intangible assets,net                     4,195            4,122
Debt issuance costs, net                   —                199
Other assets                               10               10
Total                                      $51,496         $83,395
                                                           
Liabilities and shareholders' equity                        
Current liabilities:                                        
Accounts payable                           $1,035          $1,811
Accrued liabilities                        1,830            3,361
Deferred revenue                           570              1,439
Current maturities of long-term debt       336              18
Total current liabilities                  3,771            6,629
Long-term debt,less current portion       734              11,879
Commitments and contingencies                               
Shareholders' equity:                                       
Series A Convertible preferred stock,
$0.01 par value — authorized, 28,413,291
shares at December 31, 2012 and none at    28,191           —
December 31, 2013; issued and outstanding,
2,914,187 shares at December 31, 2012 and
none at December 31, 2013
Series B Convertible preferred stock,
$0.01 par value — authorized, 70,512,809
shares at December 31, 2012 and none at    91,413           —
December 31, 2013; issued and outstanding,
7,232,092 shares at December 31, 2012 and
none at December 31, 2013
Preferred stock, $0.01 par value —
authorized, none at December 31, 2012 and
10,000,000 shares at December 31, 2013; no —                —
shares issued and outstanding, at December
31, 2012 andDecember 31, 2013
Common stock, $0.0001 par value —
authorized, 135,715,623 at December 31,
2012 and 100,000,000 at December 31, 2013; —                2
issued and outstanding, 1,733,651 shares
at December 31, 2012 and 15,757,725 shares
at December 31, 2013
Additional paid-in capital                 9,451            171,907
Accumulated deficit                        (82,064)         (107,022)
Total shareholders' equity                 46,991           64,887
Total                                      $51,496         $83,395


Cellular Dynamics International, Inc.
Statements of operations (Unaudited)
                                                               
                               Three months ended     Year ended
                                December 31,           December 31,
(Dollars in thousands, except   2012       2013        2012        2013
per share data)
Revenues:                                                       
Product sales                   $2,286   $2,482    $5,178    $7,998
Collaborations, partnerships    657       1,677      1,404      3,886
and other revenues
Total revenues                  2,943     4,159      6,582      11,884
                                                               
Costs and expenses:                                             
Cost of product sales           1,241     678        2,089      2,302
Research and development        3,949     4,949      14,301     16,622
Sales and marketing             1,323     1,806      4,398      6,516
General and administrative      2,227     3,093      8,024      10,707
Total costs and expenses        8,740     10,526     28,812     36,147
                                                               
Loss from operations            (5,797)   (6,367)    (22,230)   (24,263)
                                                               
Other (expense) income:                                         
Interest expense                (7)       (347)      (34)       (716)
Other income                    (1)       1          —          21
Total other expense             (8)       (346)      (34)       (695)
                                                               
Net loss                        $(5,805) $(6,713)  $(22,264) $(24,958)
                                                               
Net loss per share of common    $(3.35)  $(0.43)   $(0.01)   $—
stock, basic and diluted
Weighted average number of
shares used in computing net    1,733,651 15,756,363 1,727,086  7,878,060
loss per share of common stock,
basic and diluted

CONTACT: MEDIA CONTACTS:
         Joleen Rau
         Senior Director, Marketing & Communications
         Cellular Dynamics International, Inc.
         (608) 310-5142
         jrau@cellulardynamics.com
        
         Investor Relations
         Gitanjali Jain Ogawa
         The Trout Group, LLC
         (646) 378-2949
         gogawa@troutgroup.com
 
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