Pyrosequencing AB Reports Results for Fourth Quarter and Year Ended December 31, 2000 --PSQTM96 System leads DNA sequen

Pyrosequencing AB Reports Results for Fourth Quarter and Year Ended December 31, 2000 --PSQtm96 System leads DNA sequencing market-- Uppsala, Sweden, February 22, 2001, Pyrosequencing AB (PYRO A: Stockholm) today reported financial results for the fourth quarter and year ended December 31, 2000. Commenting on the results, Erik Walldén, President and CEO stated, "We are pleased to be able to report that we met our objectives for 2000. This year we launched the PSQtm96 System and received orders for 60 systems from large pharmaceutical customers, genomics companies, the agbio industry and many prestigious academic institutions. We also established a direct sales force in the United States and all the major European markets, as well as a strong distribution network in the remainder of Europe and Japan. Accomplishments for 2000 include: - Received orders for 60 PSQtm96 Systems; 53 were recognized as revenue in 2000 - Q4 Net Sales exceeded total sales for the first nine months of the year - Successfully completed an initial public offering, raising $99 million - Sold PSQtm96 Systems to renowned academic institutes, including the NIH, Harvard Center for Cancer Prevention, the Max Planck Institute and the Karolinska Institute - Increased sales to major pharmaceutical customers, including AstraZeneca, Bayer, and GlaxoSmithKline - Generated strong reagent kit sales - Increased the number of repeat sales, with six customers installing two or more systems - Established U.S. and European sales and support organizations - Developed new software applications and reagent kits including allele frequency and other sequence analysis applications Company awards based on 2000 performance include: · Forbes 300 Best Small Company - chosen from over 20,000 companies worldwide · Spin-off Company of the Year - chosen by the Royal Swedish Academy of Engineering Sciences from over 80 companies nationwide Summary financial group data (in millions except share data) Twelve months ended December 31, 2000 Three months ended December 31, 2000 2000 2000 1999 2000 2000 1999 USD* SEK SEK USD* SEK SEK Net sales 4.9 46.2 1.3 2.7 25.8 1.1 Gross profit 3.8 35.6 1.1 2.0 19.1 0.9 Gross margin, % 77.0 77.0 80.7 74.3 74.3 77.4 Operating result -10.9 -103.0 -70.6 -3.1 -29.0 -19.3 Results after financial -8.3 -78.1 -69.5 -2.0 -18.5 -18.8 items Net result per share -0.32 -3.04 -5.78 -0.06 -0.53 -1.57 As of December 31, 2000 2000 1999 USD* SEK SEK Cash, cash equivalents and short 41.3 100.7 term investments 389.6 Non current 48.4 investments 457.1 Total assets 101.0 953.5 134.0 Current 5.1 51.0 26.3 liabilities Total shareholders' 95.6 902.4 107.6 equity Weighted average shares outstanding 25663 12000 Total number of common shares outstanding 34767 14000 Convenience translation rate: SEK 9.440 = USD Financial Position For the year ended December 31, 2000, the Company reported revenues of $4.9 million compared to $0.1 million in the prior year. The increase in sales was due to the commercial launch of the PSQ 96 System in February of 2000. Revenue in 1999 reflects the sale of two systems. In the twelve months ended December 31, 2000 the Company sold 53 instruments and reported a backlog of 7 orders. The Company reported a net loss of $2.0 million, or $0.06 per share, for the quarter ended December 31, 2000, compared to a net loss of $2.0 million or $0.17 per share, for the same period last year. Net sales for the fourth quarter of 2000 were $2.7 million and were generated by sales of the PSQ 96 System and related reagent kits. Launched in February 2000, the PSQtm 96 System is the first commercially available dedicated sequencing system for applied genetic analysis. Pyrosequencing also reported net sales for the quarter ended December 31, 2000 that were in excess of total sales for the first nine months of the year. Operating expenses increased from $2.1 million in the fourth quarter of 1999 to $5.1 million in the fourth quarter of 2000. The increase in operating expenses reflects the costs associated with the Company's development of a worldwide sales organization and increased research and development costs. At December 31, cash, cash equivalents and investments in high-grade debt and equity securities, including investments with maturity dates exceeding twelve months, totaled $89.7 million as compared to $95.0 million at September 30, 2000. Pyrosequencing has no debt financing and total equity amounted to $95.6 million and $97.9 million at December 31, 2000 and September 30, 2000, providing an equity to assets ratio of 95% and 96% respectively. Capital expenditures for the full year ended December 31, 2000 amounted to $3.2 million compared to $0.6 million for the previous year. Marketing and Sales "We believe that in the first year of sales we have established the PSQtm96 System as the dominant offering in the moderate throughput segment of the DNA sequencing market," said Erik Walldén. "With the introduction of our Preferred Technology Program (PTP), we now have a strong product offering for high throughput applications. We are the only company able to offer customers a scalable solution for all aspects of applied genomics. During 2001, we expect demand to increase for the PSQ 96 and we anticipate working with a number of customers to implement PTP applications." Launched earlier this year, Pyrosequencing's PSQ96 System for applied genetic analysis, is rapidly penetrating all major geographies and target markets. Based on the Company's patented Pyrosequencingtm technology, the product performs rapid and accurate, reproducible Single Nucleotide Polymorphism (SNP) analysis, and offers a high capacity, cost-effective solution for SNP analysis and other sequence analysis used to identify gene-specific sequences. PSQtm96 Systems include a sequencing instrument, software, and reagent kits necessary to conduct SNP analysis. The Company is the leading supplier of systems for applied genetic analysis based on the fact that it has sold 53 instruments this year, including 30 in the fourth quarter, and has firm orders for another 7 instruments. Customers that purchased the PSQtm96 System during 2000 included AstraZeneca, Bayer, Glaxo SmithKline, Genomics Collaborative, the National Institutes of Health, the Max-Planck Institute, and approximately 40 other customers from the major market segments. During 2000, six customers purchased multiple machines. The majority of year 2000 sales were the result of extra-budgetary purchasing decisions made by customers. Pyrosequencing AB increased global access throughout the year by expanding the Company's own sales force in the United States and building a sales and support organization in the United Kingdom, France, Germany and Scandinavia. The Company also strengthened its distribution network through agreements with Sumitomo in Japan, B&L Biosystems for the BeNeLux countries and Paul Bucher for Switzerland. Pyrosequencing continues to pursue additional distribution partners for other target markets. Research and Development The Company plans to enhance its PSQ 96 System, which includes a SNP kit and dedicated software for automatic SNP scoring, to also feature reagents and software for other types of sequence analysis, such as bacterial typing. Expected to be commercially available during the second quarter of 2001, these products will address a new market segment with a rapidly increasing demand for using short stretches of DNA as a means of identifying gene-specific sequences. During 2000, Pyrosequencing also advanced development of its high throughput offering for SNP analysis, which is based on 384 well microplates and the same patented 'sequencing by synthesis' technology as the Company's PSQtm 96 System. In addition to new software and reagent kits, the Company's Preferred Technology Program (PTP) also includes sample preparation robotics, for a fully automated operation that can score up to 100,000 SNPs per day. The Company announced the first PTP sale in February 2001, to the newly founded Swedish consortium for functional genomics, the Wallenberg Consortium North. Additional software modules enhancing the functionality of the SNP analysis system will be released early next year. The Company has recently embarked on an evaluation of the molecular diagnostics field and formed a worldwide business unit to conduct that evaluation. Pyrosequencing believes that a unique aspect of the Pyrosequencingtm technology is its utility across a broad array of molecular diagnostics applications. Human Resources At the end of the year the total number of employees in the Pyrosequencing group was 86 compared to 38 at December 31, 1999. This report has not been subject to examination by the Company's auditors. Interim Report for the quarter ended March 31, 2001 and Annual General Meeting The results for the first quarter of 2001 will be published on May 2, 2001, the same day as the Company's Annual General Meeting, which will be held in Uppsala, Sweden. The printed version of the annual report will be published and available at the Company's premises in Uppsala, the beginning of April 2001. Pyrosequencing AB (publ) Erik Walldén, President and CEO About Pyrosequencing AB PYROSEQUENCING AB DEVELOPS, MANUFACTURES AND SELLS APPLIED GENETIC ANALYSIS SYSTEMS BASED ON ITS PYROSEQUENCING TECHNOLOGY, A SIMPLE-TO-USE DNA SEQUENCING TECHNIQUE FOR ACCURATE AND CONSISTENT ANALYSIS. IN THE POST- GENOME ERA, PYROSEQUENCING'S TECHNOLOGY ADDRESSES THE INCREASING DEMAND FOR APPLIED GENETIC ANALYSIS ACROSS VARIOUS MARKETS, INCLUDING RESEARCH AND ROUTINE CLINICAL TESTING, AS WELL AS LARGE-SCALE CUSTOMIZED INDUSTRIAL APPLICATIONS, SUCH AS DRUG DEVELOPMENT BY PHARMACEUTICAL COMPANIES. THE COMPANY'S GROWING LIST OF CUSTOMERS INCLUDES ASTRAZENECA, GLAXOSMITHKLINE, THE NATIONAL INSTITUTES OF HEALTH AND DUPONT AGRICULTURE. THE COMPANY IS HEADQUARTERED IN UPPSALA, SWEDEN WITH NORTH AMERICAN OPERATIONS LOCATED IN MASSACHUSETTS, USA. PYROSEQUENCING AB ALSO HAS SALES OFFICES AND DISTRIBUTION PARTNERS IN THE UNITED KINGDOM, GERMANY, FRANCE, SPAIN, PORTUGAL, ITALY, BENELUX, SWITZERLAND, SCANDINAVIA, EASTERN EUROPE, AND JAPAN. PYROSEQUENCING AB IS LISTED ON THE OM STOCKHOLM EXCHANGE. THE COMPANY'S WEB SITE IS WWW.PYROSEQUENCING.COM Pyrosequencing AB Erik Walldén Theresa McNeely President and CEO Sr. Director of +46 70 326 98 70 Investor/Public Relations +1 508 685 1010 Media Harry W. Wilcox Sören Densjö Executive Vice President Chief of Finance and Corporate Densjö Communications Development +1 508 369 1056 +46 70 585 0525 Certain statements in this press release are forward-looking. These may be identified by the use of forward-looking words or phrases such as "believe," "expect," "intend," "anticipate," "should," "planned," "estimated," and "potential," among others. These forward-looking statements are based on Pyrosequencing's current expectations. The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for such forward-looking statements. In order to comply with the terms of the safe harbor, Pyrosequencing notes that a variety of factors could cause actual results and experience to differ materially from the anticipated results or other expectations expressed in such forward-looking statements. Such uncertainties and risks include, but are not limited to, risks associated with management of growth and international operations (including the effects of currency fluctuations), variability of operating results, the commercial development of the DNA sequencing and genomics market, nucleic acid-based molecular diagnostics market, and genetic vaccination and gene therapy markets, competition, rapid or unexpected changes in technologies, fluctuations in demand for Pyrosequencing's products (including seasonal fluctuations), difficulties in successfully adapting the Company's products to integrated solutions and producing such products, and the Company's ability to identify and develop new products and to differentiate its products from competitors. ------------------------------------------------------------ This information was brought to you by BIT The following files are available for download: The full Year- end report The full Year- end report