<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 10-Q
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE PERIOD ENDED JUNE 30, 1997
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO
.
Commission File No. 0-28218
AFFYMETRIX, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C>
CALIFORNIA 77-0319159
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
3380 CENTRAL EXPRESSWAY, SANTA CLARA, CALIFORNIA 95051
(Address of principal executive offices) (Zip Code)
</TABLE>
Registrant's telephone number, including area code: (408)731-5000
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes____X____ No_________
COMMON SHARES OUTSTANDING ON AUGUST 5, 1997: 22,639,521
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AFFYMETRIX, INC.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets at June 30, 1997 and December 31, 1996............................ 3
Condensed Statements of Operations for the Three and Six Months Ended June 30, 1997 and
1996..................................................................................... 4
Condensed Statements of Cash Flows for the Six Months Ended June 30, 1997 and 1996......... 5
Notes to Condensed Financial Statements.................................................... 6
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.........
8
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders........................................... 10
Item 6. Exhibits and Reports on Form 8-K.............................................................. 11
SIGNATURES............................................................................................ 12
EXHIBIT INDEX......................................................................................... 13
</TABLE>
2
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AFFYMETRIX, INC.
CONDENSED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1997 1996
----------- ------------
(UNAUDITED) (NOTE)
<S> <C> <C>
ASSETS
Current assets:
Cash, cash equivalents and short-term investments................................... $ 94,645 $ 108,982
Accounts receivables................................................................ 4,480 1,888
Inventories......................................................................... 2,038 1,901
Other current assets................................................................ 393 523
----------- ------------
Total current assets.............................................................. 101,556 113,294
Net property and equipment............................................................ 8,959 5,397
Other assets.......................................................................... 985 169
----------- ------------
$ 111,500 $ 118,860
----------- ------------
----------- ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and other accrued liabilities...................................... $ 8,119 $ 5,626
Noncurrent portion of capital lease obligation........................................ 619 741
Shareholders' equity:
Common stock........................................................................ 158,750 158,687
Deferred compensation............................................................... (1,087) (1,460)
Accumulated deficit................................................................. (54,875) (44,743)
Other............................................................................... (26) 9
----------- ------------
Total shareholders' equity........................................................ 102,762 112,493
----------- ------------
$ 111,500 $ 118,860
----------- ------------
----------- ------------
</TABLE>
Note: The balance sheet at December 31, 1996 has been derived from the audited
financial statements at that date but does not include all of the
information and footnotes required by generally accepted accounting
principles for complete financial statements.
See accompanying notes.
3
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AFFYMETRIX, INC.
CONDENSED STATEMENTS OF OPERATIONS
(DOLLARS AND SHARES IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED JUNE
JUNE 30, 30,
-------------------- ---------------------
1997 1996 1997 1996
--------- --------- ---------- ---------
<S> <C> <C> <C> <C>
Revenue:
Product............................................................ $ 942 $ 436 $ 1,362 $ 457
Contract and grant................................................. 3,800 1,863 6,188 3,258
--------- --------- ---------- ---------
Total revenue.................................................... 4,742 2,299 7,550 3,715
Cost and expenses:
Cost of product revenue............................................ 979 606 1,844 707
Research and development........................................... 7,212 4,234 12,710 8,310
General and administrative......................................... 3,009 1,901 5,815 3,550
--------- --------- ---------- ---------
Total operating expenses......................................... 11,200 6,741 20,369 12,567
--------- --------- ---------- ---------
Loss from operations................................................. (6,458) (4,442) (12,819) (8,852)
Interest income, net................................................. 1,249 665 2,687 1,154
--------- --------- ---------- ---------
Net loss............................................................. $ (5,209) $ (3,777) $ (10,132) $ (7,698)
--------- --------- ---------- ---------
--------- --------- ---------- ---------
Net loss per share(1)................................................ $ (0.23) $ (0.21) $ (0.45) $ (0.43)
--------- --------- ---------- ---------
--------- --------- ---------- ---------
Shares used in computing net loss per share(1)....................... 22,613 17,900 22,594 17,782
--------- --------- ---------- ---------
--------- --------- ---------- ---------
</TABLE>
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(1) For the three and six months ended June 30, 1996, shares used in computing
net loss per share include convertible preferred shares as if they had been
converted due to the Company's initial public offering in June 1996.
See accompanying notes.
4
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AFFYMETRIX, INC.
CONDENSED STATEMENTS OF CASH FLOWS
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
SIX MONTHS ENDED JUNE 30,
-------------------------------
1997 1996
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net loss....................................................... $(10,132) $ (7,698)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation and amortization................................ 1,254 1,197
Amortization of investment premiums, net..................... 206 (637)
Loss on disposal of equipment................................ -- 62
Change in operating assets and liabilities:
Accounts receivable.......................................... (2,592) 77
Inventories.................................................. (137) (880)
Other current assets......................................... 130 (392)
Other assets................................................. (816) --
Accounts payable and other accrued liabilities............... 2,471 831
-------- --------
Net cash used in operating activities...................... (9,616) (7,440)
Cash flows from investing activities:
Capital expenditures......................................... (4,443) (1,236)
Proceeds from the sale of short-term investments............. 66,364 12,460
Proceeds from maturities of short-term investments........... 12,252 2,157
Purchases of short-term investments.......................... (44,068) (70,383)
-------- --------
Net cash (used in)/provided by investing activities........ 30,105 (57,002)
Cash flows from financing activities:
Issuance of common stock..................................... 63 83,362
Principal payments on capital lease obligation............... (101) (92)
-------- --------
Net cash (used in)/provided by financing activities........ (38) 83,270
Net increase in cash and cash equivalents........................ 20,451 18,828
Cash and cash equivalents at beginning of period................. 14,143 2,481
-------- --------
Cash and cash equivalents at end of period....................... $ 34,594 $ 21,309
-------- --------
-------- --------
</TABLE>
See accompanying notes.
5
<PAGE>
AFFYMETRIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
JUNE 30, 1997
(UNAUDITED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES
BASIS OF PRESENTATION
The accompanying unaudited condensed financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring accruals) considered necessary for a fair presentation have
been included. Operating results for the three and six month periods ended June
30, 1997 are not necessarily indicative of the results that may be expected for
the year ending December 31, 1997. For further information, refer to the
financial statements and notes thereto included in the Annual Report on Form
10-K for the year ended December 31, 1996 and the Quarterly Report on Form 10-Q
for the quarter ended March 31, 1997, by Affymetrix, Inc. ("Affymetrix" or the
"Company").
REVENUE RECOGNITION
Contract and grant revenue is recorded as earned as defined within the
specific agreements. Payments received in advance under these arrangements are
recorded as deferred revenue until earned. Direct costs associated with these
contracts and grants, other than cost of goods sold, are reported as research
and development expense. Product revenue is recognized upon shipment. Certain
reserves are also recorded upon product shipment.
NOTE 2. CASH, CASH EQUIVALENTS AND SHORT-TERM INVESTMENTS
As of June 30, 1997, debt securities held by the Company are comprised of
U.S. Government obligations and U.S. Corporate debt securities. They are
classified as available-for-sale and are carried at fair value with unrealized
gains and losses reported in shareholders' equity.
NOTE 3. INVENTORIES
Inventories consist of the following (in thousands):
<TABLE>
<CAPTION>
JUNE 30, DECEMBER 31,
1997 1996
----------- -------------
<S> <C> <C>
Raw material......................................................... $ 579 $ 358
Work in process...................................................... 79 178
Finished goods....................................................... 1,380 1,365
----------- ------
Total............................................................ $ 2,038 $ 1,901
----------- ------
----------- ------
</TABLE>
NOTE 4. SHAREHOLDERS' EQUITY
The Company's initial public offering on June 6, 1996 generated net proceeds
of approximately $83.0 million from the sale of 6.0 million shares. On July 5,
1996, the Company's underwriters purchased 153,000 shares pursuant to the
over-allotment option, for additional net proceeds of $2.1 million. The Company
had 22.6 million shares outstanding at June 30, 1997.
6
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AFFYMETRIX, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS (CONTINUED)
JUNE 30, 1997
(UNAUDITED)
NOTE 5. RECENTLY ISSUED ACCOUNTING STANDARD
In February 1997, the Financial Accounting Standards Board issued Statement
No. 128, Earnings Per Share, which is required to be adopted on December 31,
1997. At that time, the Company will be required to change the method currently
used to compute earnings per share. The adoption of FAS 128 will not result in a
change to previously reported earnings per share information.
7
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management's Discussion and Analysis of Financial Condition and Results
of Operations as of June 30, 1997 and for the three and six month periods ended
June 30, 1997 and 1996 should be read in conjunction with the Management's
Discussion and Analysis of Financial Condition and Results of Operations
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1996 and the Quarterly Report on Form 10-Q for the quarter ended March 31,
1997.
All statements in this discussion that are not historical are forward
looking statements. Such statements are subject to risks and uncertainties that
could cause actual results to differ materially from those projected, including,
but not limited to, uncertainties relating to technological approaches, product
development, manufacturing and market acceptance, uncertainties related to cost
and pricing of the Company's products, dependence on collaborative partners,
uncertainties relating to sole source suppliers, uncertainties relating to FDA
and other regulatory approvals, competition, risks relating to intellectual
property of others, uncertainties of patent protection and uncertainties related
to litigation. These and other risk factors are discussed herein and in the
reports filed with the Securities and Exchange Commission, including the
Company's Annual Report on Form 10-K for the year ended December 31, 1996 and
Quarterly Report on Form 10-Q for the quarter ended March 31, 1997. These
forward-looking statements speak only as of the date hereof. The Company
expressly disclaims any obligation or undertaking to released publicly any
updates or revisions to any forward-looking statements contained herein to
reflect any change in the Company's expectations with regard thereto or any
change in events, conditions, or circumstances on which any such statements are
based.
OVERVIEW
Affymetrix is developing GeneChip systems and related applications and
technologies for the acquisition, analysis and management of complex genetic
information. The business and operations of the Company were commenced in 1991
by Affymax N.V. ("Affymax") and were initially conducted within Affymax. In
March 1992, the Company was incorporated as a California corporation and
wholly-owned subsidiary of Affymax. In September 1993, the Company issued equity
securities through a private financing of approximately $21.0 million that
reduced Affymax' ownership to approximately 65%. In March 1995, Glaxo plc, now
Glaxo Wellcome plc ("Glaxo") acquired Affymax, including its then majority
ownership interest in Affymetrix. In August 1995, the Company issued equity
securities through a second private financing of approximately $39.0 million,
reducing Affymax' percentage ownership to approximately 46%. As a result of the
Company's initial public offering of approximately 6.0 million shares in June
1996, Glaxo Wellcome indirectly owned approximately 34% of Affymetrix.
Currently, Glaxo Wellcome owns approximately 33% of Affymetrix.
RESULTS OF OPERATIONS
THREE MONTHS AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996
Product revenue was $942,000 and $1.4 million for the three and six months
ended June 30, 1997, respectively, compared to $436,000 and $457,000 in the
three and six months ended June 30, 1996. Contract and grant revenue increased
to $3.8 million for the three months ended June 30, 1997 from $1.9 million for
the three months ended June 30, 1996. Contract and grant revenue increased to
$6.2 million for the six months ended June 30, 1997 from $3.3 million for the
six months ended June 30, 1996. The increase was primarily due to milestone
accomplishments with certain collaborative partners and increases in funding
from the Advanced Technology Program and NIH National Center for Human Genome
Research grants.
8
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Cost of product revenue was $979,000 and $1.8 million for the three and six
months ended June 30, 1997, respectively, compared to $606,000 and $707,000 for
the three and six months ended June 30, 1996. Margins fluctuated during the
three and six month periods due primarily to scale-up costs of production.
Research and development expenses increased to $7.2 million and $12.7
million for the three and six months ended June 30, 1997, respectively, compared
to $4.2 million and $8.3 million for the same periods ending June 30, 1996. The
increase in research and development expenses was attributable primarily to the
hiring of additional research and development personnel and associated purchases
of research supplies. The Company expects research and development spending to
increase over the next several years as product development and core research
efforts continue to expand.
General and administrative expenses increased to $3.0 million for the three
months ended June 30, 1997 compared to $1.9 million for the three months ended
June 30, 1996. General and administrative expenses increased to $5.8 million for
the six months ended June 30, 1997 compared to $3.6 million for the six months
ended June 30, 1996. The increase in general and administrative expenses was
attributable primarily to the hiring of additional management personnel,
professional fees (primarily legal fees) and overall scale-up of the Company's
operations and business development efforts. General and administrative expenses
are expected to continue to increase as the Company expands sales and marketing
and adds management and support staff.
Net interest income was $1.2 million and $2.7 million for the three and six
months ended June 30, 1997, respectively. This compares to net interest income
of $665,000 and $1.2 million for the three and six months ended June 30, 1996.
The increase in net interest income was primarily attributable to increased
investment balances from the initial public offering in June 1996.
LIQUIDITY AND CAPITAL RESOURCES
As of June 30, 1997, the Company's cash, cash equivalents, and short-term
investments were $94.6 million compared to $109 million at December 31, 1996.
The decrease is primarily attributable to expansion of core research,
manufacturing and capital spending, and growth in general and administrative
expenses.
Net cash used in operating activities was $9.6 million for the six months
ended June 30, 1997, as compared to $7.4 million for the six months ended June
30, 1996. The increase in net cash used in operating activities resulted
primarily from increases in the Company's net loss and accounts receivables,
offset by an increase in accounts payable and other accrued liabilities. The
Company's investing activities, other than purchases, sales and maturities of
available-for-sale securities, consisted of capital expenditures, which totaled
$4.4 million and $1.2 million for the six months ended June 30, 1997 and 1996,
respectively. These capital expenditures included investments in facilities and
laboratory equipment and scale-up of manufacturing.
The Company anticipates that the existing capital resources will enable it
to maintain currently planned operations through at least 1998. However, this
expectation is based on the Company's current operating plan, which could
change, and therefore the Company could require additional funding sooner than
anticipated. In addition, the Company expects its capital requirements to
increase over the next several years as it expands its facilities and acquires
scientific equipment to support expanded manufacturing and research and
development efforts. The Company's long-term capital expenditure requirements
will depend on numerous factors, including: the progress of its research and
development programs; initiation or expansion of research programs; the
development of commercial scale manufacturing capabilities; its ability to
maintain existing collaborative arrangements and establish and maintain new
collaborative arrangements; the costs involved in preparing, filing,
prosecuting, defending and enforcing intellectual property rights; the
effectiveness of product commercialization activities and arrangements; and
other factors.
9
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AFFYMETRIX, INC.
JUNE 30, 1997
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
(a) Date of meeting.
The Annual Meeting of the Shareholders of Affymetrix, Inc. was held on
June 6, 1997.
(b) Description of each matter voted on and number of votes cast.
<TABLE>
<CAPTION>
FOR AGAINST WITHHELD
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<C> <S> <C> <C> <C>
1. To elect directors to serve until the next annual meeting of shareholders
or until their successors are elected.
John D. Diekman, Ph.D. 20,211,174 0 5,570
Stephen P.A. Fodor, Ph.D. 20,211,174 0 5,570
Paul Berg, Ph.D. 20,211,174 0 5,570
Douglas M. Hurt 20,211,074 0 5,670
Vernon R. Loucks, Jr. 19,936,050 0 280,694
Barry C. Ross, Ph.D. 20,211,174 0 5,670
David B. Singer 20,209,699 0 7,045
Lubert Stryer, M.D. 20,210,774 0 5,970
John A. Young 20,211,099 0 5,645
Alejandro C. Zaffaroni, Ph.D. 20,211,174 0 5,570
2. To approve an Amendment to the Company's Amended and Restated 1993 Stock 16,159,222 308,164 92,686
Plan to provide for additional shares.
3. To approve an Amendment to the Company's Amended and Restated 1993 Stock 19,758,881 273,879 17,895
Plan to limit the number of shares that may be granted to any
participant in any one-year period.
4. To approve an amendment to the Company's Amended and Restated 1993 Stock 19,442,728 382,862 26,472
Plan to reflect changes to the shareholder approval requirements of
Securities and Exchange Commission Rule 16b-3.
5. To ratify the appointment of Ernst & Young LLP as independent auditors of 20,196,862 10,082 9,800
the Company for the fiscal year ending December 31, 1997.
</TABLE>
10
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AFFYMETRIX, INC.
JUNE 30, 1997
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------ ------------------------------------------------------------
<S> <C>
10.28(1) Consortium Member Agreement between Affymetrix, Inc.,
Bristol-Myers Squibb Company and Millennium
Pharmaceuticals, Inc. effective as of April 28, 1997.
10.29(2) Sponsored Research Agreement between Whitehead Institute for
Biomedical Research, Affymetrix, Inc., Bristol-Myers
Squibb Company and Millennium Pharmaceuticals, Inc.
effective as of April 28, 1997.
11.1 Statement of computation of net loss per share.
27.0 Financial data schedule.
</TABLE>
- ------------------------
(1) Previously filed as Exhibit Number 10.5 to the quarterly report on Form 10-Q
of Millennium Pharmaceuticals, Inc. filed August 14, 1997. [SEC File No.
0-28494]
(2) Previously filed as Exhibit Number 10.4 to the quarterly report on Form 10-Q
of Millennium Pharmaceuticals, Inc. filed August 14, 1997. [SEC File No.
0-28494]
(b) Reports on Form 8-K:
No reports on Form 8-K were filed during the quarter ended June 30, 1997.
11
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
AFFYMETRIX, INC.
August 8, 1997 By: /s/ EDWARD M. HURWITZ
-----------------------------------------
Edward M. Hurwitz
VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
12
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AFFYMETRIX, INC.
EXHIBIT INDEX
JUNE 30, 1997
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
- ------ ----------------------------------------------------------------------
<S> <C>
10.28(1) Consortium Member Agreement between Affymetrix, Inc., Bristol-Myers
Squibb Company and Millennium Pharmaceuticals, Inc. effective as of
April 28, 1997
10.29(2) Sponsored Research Agreement between Whitehead Institute for
Biomedical Research, Affymetrix, Inc., Bristol-Myers Squibb Company
and Millennium Pharmaceuticals, Inc. effective as of April 28, 1997
11.1 Statement of computation of net loss per share
27.0 Financial data schedule
</TABLE>
- ------------------------
(1) Previously filed as Exhibit Number 10.5 to the quarterly report on Form 10-Q
of Millennium Pharmaceuticals, Inc. filed August 14, 1997. [SEC File No.
0-28494]
(2) Previously filed as Exhibit Number 10.4 to the quarterly report on Form 10-Q
of Millennium Pharmaceuticals, Inc. filed August 14, 1997. [SEC File No.
0-28494]
13
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EXHIBIT 11.1
AFFYMETRIX, INC.
STATEMENT OF COMPUTATION OF NET LOSS PER SHARE
(DOLLARS AND SHARES IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
-------------------- --------------------
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net loss.............................................................. $ 5,209 $ 3,777 $ 10,132 $ 7,698
--------- --------- --------- ---------
--------- --------- --------- ---------
Historical primary and fully diluted number of shares:
Weighted average common shares...................................... 22,613 6,564 22,594 3,486
Shares related to SAB Topic 4D...................................... 0 0 0 3,702
--------- --------- --------- ---------
Shares used in computing net loss per share........................... 22,613 6,564 22,594 7,188
--------- --------- --------- ---------
--------- --------- --------- ---------
Net loss per share.................................................... $ (0.23) $ (0.58) $ (0.45) $ (1.07)
--------- --------- --------- ---------
--------- --------- --------- ---------
Pro forma number of shares:
Weighted average common shares...................................... 22,613 6,564 22,594 3,486
Shares related to SAB Topic 4D...................................... 0 0 0 3,702
Convertible preferred shares, as if converted....................... 0 11,336 0 10,594
--------- --------- --------- ---------
Shares used in computing pro forma loss per share..................... 22,613 17,900 22,594 17,782
--------- --------- --------- ---------
--------- --------- --------- ---------
Pro forma net loss per share.......................................... $ (0.23) $ (0.21) $ (0.45) $ (0.43)
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM ITEM 1
OF FORM 10-Q FOR THE PERIOD ENDED JUNE 30, 1997 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 34,594
<SECURITIES> 60,051
<RECEIVABLES> 4,480
<ALLOWANCES> 0
<INVENTORY> 2,038
<CURRENT-ASSETS> 101,556
<PP&E> 8,959
<DEPRECIATION> 0
<TOTAL-ASSETS> 111,500
<CURRENT-LIABILITIES> 8,119
<BONDS> 0
0
0
<COMMON> 158,750
<OTHER-SE> (55,988)
<TOTAL-LIABILITY-AND-EQUITY> 111,500
<SALES> 1,362
<TOTAL-REVENUES> 7,550
<CGS> 1,844
<TOTAL-COSTS> 1,844
<OTHER-EXPENSES> 12,710
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,687
<INCOME-PRETAX> (10,132)
<INCOME-TAX> 0
<INCOME-CONTINUING> (10,132)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (10,132)
<EPS-PRIMARY> (0.45)
<EPS-DILUTED> (0.45)
</TABLE>
