Compugen Ltd (CGEN)

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New management, old habits: Compugen loses $3.6 million in third quarter
03.11.2005 | 09:26
Amir Eisenberg

Tel Aviv-based Compugen (Nasdaq: CGEN) yesterday reported a third-quarter loss of $3.6 million, or 13 cents per share - identical figures to the corresponding quarter of 2004 and somewhat worse than its second quarter loss of $3.3 million or 12 cents per share. The new mgmt hasn't managed to stop the bleed.

Over seven years the company has lost $80 million, of which $10.6 million was lost this year.

Compugen's market cap is $83 million, having lost 14% of its value this year.

As of September 30, the company had $38 million in cash, cash equivalents and marketable securities, down $3 million from June 30.

Alex Kotzer, who came over to Compugen from Serono, took over the reins as CEO and president on September 1. Yesterday he had the mixed pleasure of presenting the company reports for the first time. With Compugen suffering a quarter of heavy losses, Kotzer was the only good news in the report.

Compugen is a drug and diagnostic discovery company that incorporates concepts and methods from mathematics, computer science and physics for use in biology, chemistry and medicine.

Third quarter revenues came to $761,000, compared to $971,000 in the same period of 2004. About $666,000 of that came from government and other grants up from $326,000 in Q3 2004. A hard-core optimist could take comfort in the fact that the $95,000 in non-grant income for the third quarter was an improvement over the previous reporting period, when this sum was only about $70,000.

In the second quarter, Compugen announced collaboration agreements with Diagnostic Products Corporation and with Johnson & Johnson company Ortho-Clinical Diagnostics. The agreements were viewed as potentially lucrative for Compugen, but it now appears that investors will have to continue to wait before seeing returns.

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