Champions Biotechnology Reports Fiscal 2011 Third Quarter Financial Results

Baltimore, MD – March 07, 2011 – Champions Biotechnology, Inc. (OTC: CSBR), today announced its operating results for its third fiscal quarter ended January 31, 2011.

Fiscal 2011 Third Quarter Financial Highlights

  • Total operating revenue of $2,805,000 representing an increase of 278% compared to the third quarter of 2010
  • Net loss of ($415,000); Net income excluding stock based compensation of $796,000*
  • Net loss of ($0.02) per share; Net income excluding stock-based compensation of $0.02 per diluted share*
  • Cash and Cash Equivalents of $2,941,000

Fiscal 2011 Third Quarter Financial Results

Total revenues for the third quarter of fiscal 2011 were $2,805,000 compared to $742,000 in the third quarter of fiscal 2010, an increase of $2,063,000, or 278%. Revenues from Personalized Oncology Solutions, or POS, were $1,419,000 compared to $325,000 in the corresponding quarter of the prior year, an increase of $1,094,000, or 337%. The increase is primarily due to the increased volume of POS business during the quarter. Revenues from Translational Oncology Solutions, or TOS, previously referred to as Preclinical eValuation services, were $1,386,000 for the quarter compared to $417,000 in the corresponding quarter of the prior year, an increase of $969,000, or 232%. The increase is primarily due to the increased volume of TOS business during the quarter.

Costs of POS for the three months ended January 31, 2011 and 2010 were $751,000 and $162,000, respectively, an increase of $589,000, or 364%. The increase in costs was due to the increased volume of POS business. For the three months ended January 31, 2011 and 2010, gross margins for POS was 47% and 50%, respectively. The decrease in gross margin was attributable to the reduction in POS fees that the Company has instituted to increase affordability of the services being offered.

Costs of TOS for the three months ended January 31, 2011 and 2010 were $584,000 and $202,000, respectively, an increase of $382,000, or 189%. For the three months ended January 31, 2011 and 2010, gross margins for TOS was 58% and 52%, respectively. The increase in gross margin is a reflection of the efficiencies achieved as the business continues to grow.

Research and Development

Research and development, or R&D, expenses for the three months ended January 31, 2011 and 2010 were $400,000 and $566,000, respectively, a decrease of $166,000, or 29%. The decrease in R&D expenses in 2011 was primarily due to the recognition of $130,000 in licensing fees and costs associated with the Bithionol agreement in 2010, which were not incurred during 2011.

General and Administrative

General and administrative, or G&A, expenses for the three months ended January 31, 2011 and 2010 were $1,856,000 and $595,000, respectively, an increase of $1,261,000, or 212%. The increase was primarily due to the $1,135,000 stock-based compensation expense related to stock options issued to our Chief Executive Officer and President.

Interest and Other Income, Net

Interest and other income for the three months ended January 31, 2011 was $371,000, which primarily relates to grant income earned under the Qualifying Therapeutic Discovery Project program administered under Section 48D of the Internal Revenue Code based on the percentage of qualifying expenses incurred through the nine months ended January 31, 2011 compared to the total expected expenses to be incurred for fiscal year 2011.

Cash and Cash Equivalents

The Company’s cash position on January 31, 2011 was $2,941,000 compared to $2,572,000 on April 30, 2010.
For the nine-month period ended January 31, 2011, revenues were $5,338,000 compared to $2,993,000 for the comparable period last year, an increase of $2,345,000, or 78%. Total operating expenses, which include costs of POS and TOS, R&D and G&A were $7,742,000 compared to $5,369,000 for the comparable period last year, an increase of $2,373,000, or 44%. Interest and other income for the nine months ended January 31, 2011 was $1,344,000. The Company reported a net loss of $1,060,000, or ($0.03) per share, as compared to a net loss of $2,371,000, or ($0.07) per share, for the comparable period in fiscal 2010.

Joel Ackerman, the Company’s Chief Executive Officer, commented, “The financial growth we achieved this quarter is a clear indication of the need for personalized oncology products for both physicians and medical technology companies. The foundation that was built over the last three years, combined with the sales resources we are adding, is beginning to result in an increased momentum for our Company.”