How did Illumina's financial results change over the last three fiscal years?

Total revenue grew from $10.0 million in 2002 to $28.0 million in 2003 and $50.6 million in fiscal 2004. The net loss was $40.3 million in 2002, $27.1 million in 2003, and $6.2 million in fiscal 2004.

What drove the reduction in the net loss in fiscal 2004?

Revenue increased substantially, and the company recorded a $4.2 million credit in litigation judgment (settlement), which included a $3.3 million gain from the revised termination-of-employment judgment and a $1.5 million gain from the Applera settlement. Operating expenses also declined for research and development, to $21.1 million from $22.5 million, while selling, general and administrative expenses rose to $25.1 million from $18.9 million.

What is the status of the Affymetrix patent lawsuit?

Affymetrix filed a complaint in July 2004 in the U.S. District Court for the District of Delaware alleging that certain Illumina products infringe six Affymetrix patents. Illumina filed an answer and counterclaims in September 2004, denies infringement, and intends to defend the suit vigorously. No trial date had been set, and the company cannot be sure it will prevail.

What happened to the company's cash position and the headquarters property?

The company sold its land and buildings for $42.0 million in August 2004, repaid the remaining $25.2 million of debt, and received $15.5 million in net cash proceeds. It then entered into a ten-year leaseback of the San Diego facility. Cash and cash equivalents ended the year at $54.8 million, up from $12.5 million at the prior year-end.

What is the CyVera acquisition, and when is it expected to close?

In February 2005, Illumina signed a definitive merger agreement with CyVera Corporation, a privately held Connecticut-based company, under which CyVera would become a wholly owned subsidiary. The aggregate consideration is $17.5 million, consisting of about 1.5 million shares of common stock and approximately $2.3 million of CyVera liabilities. Closing was subject to customary conditions and was expected by the end of March 2005, with first CyVera-based products expected in the second half of 2006.

ILMN 10-K FY2005 Annual Report — Revenue, Net Income, EPS

01—Abstract

Summary

Summary of the 10-K/A filed March 29, 2005. Cited figures are marked; the original filing is the authoritative source.

This filing is Amendment No. 1 to Illumina, Inc.'s Form 10-K for the fiscal year ended January 2, 2005, filed March 29, 2005.

The amendment consists of Part IV (Item 15) and the consolidated financial statements, including the report of Ernst & Young LLP, which issued an unqualified opinion on the financial statements and on internal control over financial reporting as of January 2, 2005. It states that it continues to speak as of the date of the original Annual Report and should be read with the Company's other SEC filings. Financially, total revenue for the year ended January 2, 2005 was $50.6 million^a, up from $28.0 million in 2003 and $10.0 million in 2002, while the net loss narrowed to $6.2 million, or $0.17 per share, from $27.1 million, or $0.85 per share, in 2003.

The improvement was helped by a $4.2 million^b litigation judgment (settlement) credit and a $1.5 million legal settlement gain tied to the Applera/Applied Biosystems settlement. Cash and cash equivalents rose to $54.8 million from $12.5 million, largely due to the $40.7 million of net proceeds from the sale of the land and building, which was followed by a leaseback, and $30.5 million from common stock issuance. Net cash used in operating activities was $19.6 million.

The filing also discloses material legal and business risks. Affymetrix filed a patent infringement complaint in July 2004 seeking unspecified damages and an injunction, and the Company states that an adverse outcome could have a material adverse effect. The Company also disclosed a February 2005 merger agreement with CyVera Corporation for $17.5 million^c in consideration, consisting of about 1.5 million shares and approximately $2.3 million of CyVera liabilities.

02—Key points

Key Highlights

Total revenue rose to $50.6 million for the year ended January 2, 2005, compared with $28.0 million in 2003 and $10.0 million in 2002.
Net loss narrowed to $6.2 million ($0.17 per share) from $27.1 million ($0.85 per share) in fiscal 2003.
Product revenue was $40.5 million, up from $18.4 million in 2003, while service revenue was $8.1 million and research revenue was $2.0 million.
Cash and cash equivalents increased to $54.8 million from $12.5 million, supported by $40.7 million of net proceeds from the sale of land and buildings and $30.5 million from common stock issuance.
A $4.2 million litigation judgment (settlement) benefit and a $1.5 million Applera settlement gain reduced operating expenses in fiscal 2004.
Affymetrix filed a July 2004 patent infringement complaint seeking unspecified damages and an injunction; the Company says an unfavorable outcome could materially affect its business.
A February 2005 agreement to acquire CyVera Corporation totals $17.5 million in consideration, including about 1.5 million shares of common stock.

03—Questions

Frequently Asked Questions

How did Illumina's financial results change over the last three fiscal years?
Total revenue grew from $10.0 million in 2002 to $28.0 million in 2003 and $50.6 million in fiscal 2004. The net loss was $40.3 million in 2002, $27.1 million in 2003, and $6.2 million in fiscal 2004.
What drove the reduction in the net loss in fiscal 2004?
Revenue increased substantially, and the company recorded a $4.2 million credit in litigation judgment (settlement), which included a $3.3 million gain from the revised termination-of-employment judgment and a $1.5 million gain from the Applera settlement. Operating expenses also declined for research and development, to $21.1 million from $22.5 million, while selling, general and administrative expenses rose to $25.1 million from $18.9 million.
What is the status of the Affymetrix patent lawsuit?
Affymetrix filed a complaint in July 2004 in the U.S. District Court for the District of Delaware alleging that certain Illumina products infringe six Affymetrix patents. Illumina filed an answer and counterclaims in September 2004, denies infringement, and intends to defend the suit vigorously. No trial date had been set, and the company cannot be sure it will prevail.
What happened to the company's cash position and the headquarters property?
The company sold its land and buildings for $42.0 million in August 2004, repaid the remaining $25.2 million of debt, and received $15.5 million in net cash proceeds. It then entered into a ten-year leaseback of the San Diego facility. Cash and cash equivalents ended the year at $54.8 million, up from $12.5 million at the prior year-end.
What is the CyVera acquisition, and when is it expected to close?
In February 2005, Illumina signed a definitive merger agreement with CyVera Corporation, a privately held Connecticut-based company, under which CyVera would become a wholly owned subsidiary. The aggregate consideration is $17.5 million, consisting of about 1.5 million shares of common stock and approximately $2.3 million of CyVera liabilities. Closing was subject to customary conditions and was expected by the end of March 2005, with first CyVera-based products expected in the second half of 2006.

04—Continue

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