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Sangamo BioSciences Inc. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: May 5, 2009 10:03PM

Sangamo BioSciences Inc. (SGMO) filed Quarterly Report for the period ended 2009-03-31. Sangamo BioSciences Inc. is a leader in the development of noveltranscription factors for the regulation of gene expression. Transcriptionfactors are proteins that turn genes on or off by recognizing specific DNAsequences. The Universal Gene Recognition technology platform enables theengineering of a class of transcription factors known as zinc finger DNA binding proteins. Sangamo BioSciences Inc. has a market cap of $148.3 million; its shares were traded at around $3.61 with and P/S ratio of 9.2. Sangamo BioSciences Inc. had an annual average earning growth of 5.9% over the past 5 years.

Highlight of Business Operations:

Revenues from our corporate collaboration and strategic partnering agreements were $3.2 million for the three months ended March 31, 2009, compared to $2.1 million in the corresponding period in 2008. The increase in collaboration agreement revenues was primarily attributable to increased revenues of $897,000 in connection with our research license and commercial option agreement with Dow AgroSciences LLC (“DAS”), and revenues of $250,000 in connection with the OMT agreement, partially offset by decreased revenues of $137,000 related to our research and license agreement with Genentech. Research grant revenues were $0 for the three months ended March 31, 2009, compared to $681,000 in the corresponding period in 2008. The decrease in research grant revenues was primarily due to decreased revenues of $375,000 and $252,000 related to our grant from the Juvenile Diabetes Research Foundation (“JDRF”) and the Michael J. Fox Foundation (“MJFF”), respectively.

Research and development expenses were $7.3 million for the three months ended March 31, 2009, compared to $8.6 million in the corresponding period in 2008. The decrease in research and development expenses was primarily attributable to decreased pre-clinical and clinical studies expenses of $996,000, primarily associated with our diabetic neuropathy program, and decreased expenses related to lab supplies of $184,000, consulting of $245,000, licensing of $238,000 and stock-based compensation of $142,000. This was partially offset by increased manufacturing expenses of $537,000, primarily associated with our Phase 1 HIV/AIDS study and our planned Phase 1 glioblastoma multiforme study.

During the three months ended March 31, 2009, the net cash used in operating activities was $7.1 million. Net cash used in operating activities related to our net loss of $6.8 million and changes in operating assets and liabilities of $1.8 million. The changes in operating assets and liabilities were primarily comprised of decreases in deferred revenues of $2.0 million and increases in accounts receivable of $363,000, partially offset by increases in accrued compensation and employee benefits of $449,000. This was partially offset by net non-cash charges of $1.6 million. Non-cash charges were primarily comprised of $1.5 million related to stock-based compensation and depreciation and amortization of $144,000, partially offset by amortization of premium / discount on marketable securities of $136,000. During the three months ended March 31, 2008, net cash used in operating activities related to our net loss of $8.0 million and changes in operating assets and liabilities of $1.8 million. The changes in operating assets and liabilities were primarily comprised of decreases in deferred revenues of $1.6 million, accrued compensation and employee benefits of $457,000 and increases in accounts receivable of $404,000, partially offset by increases in accounts payable and accrued liabilities of $574,000 and decreases in interest receivable of $155,000. This was partially offset by net non-cash charges of $1.3 million. Non-cash charges were primarily comprised of $1.7 million related to stock-based compensation and depreciation and amortization of $115,000, partially offset by amortization of premium / discount on marketable securities of $492,000.

During the three months ended March 31, 2009, net cash provided by investing activities was $2.4 million. Cash provided by investing activities was comprised of maturities of marketable securities of $21.3 million, partially offset by purchases of marketable securities of $18.8 million and purchases of property and equipment of $55,000. During the three months ended March 31, 2008, net cash provided by investing activities was $5.6 million. Cash provided by investing activities was comprised of maturities of marketable securities of $29.3 million and proceeds from sales of investments of $4.0 million, partially offset by purchases of marketable securities of $27.3 million and purchases of property and equipment of $365,000.

Net cash used in financing activities for the three months ended March 31, 2009 was $25,000 and primarily related to the repurchase of common stock. Net cash provided by financing activities for the three months ended March 31, 2008 was $17,000 and related to proceeds from the issuance of common stock.

Read the The complete Report

SGMO is in the portfolios of Jean-Marie Eveillard of Arnhold & S. Bleichroeder Advisers, LLC.


Stocks Discussed: SGMO,
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