OccuLogix, Inc.
NASDAQ : RHEO
TSX : RHE

OccuLogix, Inc.

August 03, 2006 16:05 ET

OccuLogix Reports Q2-06 Financial Results

TORONTO, ONTARIO--(CCNMatthews - Aug. 3, 2006) - OccuLogix, Inc. (NASDAQ:RHEO)(TSX:RHE) today reported its consolidated financial results for the three months ended June 30, 2006. All dollar amounts are expressed in U.S. currency, and results are reported in accordance with United States generally accepted accounting principles (U.S. GAAP).

For the second quarter of 2006, net revenues were $82,715 compared to $597,841 in the second quarter of 2005. On June 12, 2006, the Company announced that it had met with the U.S. Food and Drug Administration ("FDA") to discuss the results of MIRA-1, the Company's recently completed clinical trial of its RHEO™ System to treat the dry form of age-related macular degeneration, and confirmed that the FDA will require the Company to perform an additional study of the RHEO™ System. In accordance with Statement of Financial Accounting Standards No. 142, "Goodwill and Other Intangible Assets", OccuLogix concluded that, based on the price of the Company's common stock as at June 30, 2006 and the Company's current market capitalization subsequent to the June 12, 2006 announcement, there were sufficient indicators to require management to re-assess whether the Company's recorded goodwill was further impaired as at June 30, 2006. Based on the goodwill impairment analysis, OccuLogix concluded that a goodwill impairment charge of $66.0 million should be recorded during the three months ended June 30, 2006. Including this non-cash impairment charge, the Q2-06 net loss was $70.0 million, or $1.66 per share.

As of June 30, 2006, the Company had cash and cash equivalents and short term investments of $30.7 million.

Conference Call and Webcast Information

OccuLogix will hold a conference call to discuss these results today, August 3, at 4:30 p.m. Eastern Time at 800- 734-1279 (within the United States and Canada), or 416-620-2419 (internationally). The call will also be broadcast live and archived on the company's website at www.occulogix.com under the "webcasts" link in the Investor Relations section. For those wishing to listen to a recording of the call via telephone, a replay will be made available as soon as possible after the conclusion of the live call and will remain posted for a period of seven days. To listen to the recording, simply telephone 416-626-4100 and enter reservation # 21300334 when prompted.

About OccuLogix, Inc.

OccuLogix is a health care company that brings innovative and evidenced-based medical therapies to market. OccuLogix's common shares trade on the NASDAQ National Market under the symbol 'RHEO' and on the Toronto Stock Exchange under the symbol 'RHE'. Visit us on the internet at www.occulogix.com (corporate) and www.rheo.com (healthcare professionals, patients and caregivers).

Forward-Looking Statements

This press release may contain forward-looking statements. These statements relate to future events and are subject to risks, uncertainties and assumptions about the Company. These statements are only predictions based on our current expectations and projections about future events. You should not place undue reliance on these statements. Actual events or results may differ materially. Many factors may cause our actual results to differ materially from any forward-looking statement, including the factors detailed in our filings with the Securities and Exchange Commission and Canadian regulatory authorities, including our Registration Statement on Form S-1. We do not undertake to update any forward-looking statements.




CONSOLIDATED STATEMENTS OF OPERATIONS
(expressed in U.S. dollars)
(Unaudited)

Three months ended,
June 30,
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2006 2005
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Revenues
Sales to unrelated parties $ 82,715 $ 583,115
Sales to related parties - 14,726
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Total revenues 82,715 597,841
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Cost of goods sold
Cost of goods sold to unrelated
parties (20,683) 368,098
Cost of goods sold to related
parties - 10,757
Royalty costs 25,000 25,000
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Total cost of goods sold 4,317 403,855
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Gross margin 78,398 193,986
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Operating expenses
General and administrative 2,753,780 2,199,372
Clinical and regulatory 1,471,473 1,309,989
Sales and marketing 465,347 380,061
Impairment of goodwill 65,945,686 -
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70,636,286 3,889,422
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Loss from operations (70,557,888) (3,695,436)
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Other income (expense)
Interest income 410,228 420,980
Other (6,724) (44,056)
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403,504 376,924
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Loss before income taxes (70,154,384) (3,318,512)
Recovery of income taxes 158,792 158,792
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Net loss for the period $ (69,995,592) $ (3,159,720)
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Weighted average number of
shares outstanding
- basic and diluted 42,186,579 41,860,288
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Basic and diluted net loss
per share $ (1.66) $ (0.08)
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CONSOLIDATED BALANCE SHEETS
(expressed in U.S. dollars)
(Unaudited)

June 30, December 31,
2006 2005
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ASSETS
Current
Cash and cash equivalents $ 18,180,386 $ 9,599,950
Short-term investments 12,555,000 31,662,845
Amounts receivable, net 511,607 554,966
Due from related party 892 -
Inventory, net 4,206,246 4,701,464
Prepaid expenses 300,105 803,268
Deposit 10,442 4,891
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Total current assets 35,764,678 47,327,384
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Fixed assets, net 633,291 470,561
Deferred acquisition costs 234,054 135,232
Note receivable 2,000,000 -
Patents and trademarks, net 141,716 -
Intangible asset, net 23,068,862 23,927,195
Goodwill - 65,945,686
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Total assets $ 61,842,601 $ 137,806,058
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable $ 159,245 $ 522,520
Accrued liabilities 1,679,788 2,226,619
Due to related party - 5,065
Due to stockholders 90,964 158,233
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Total current liabilities 1,929,997 2,912,437
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Deferred tax liability 8,535,479 8,853,062
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Total liabilities 10,465,476 11,765,499
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Stockholders' equity
Capital stock
Common stock 42,187 42,086
Par value of $0.001 per share
Authorized: 75,000,000; Issued
and outstanding:
June 30, 2006 - 42,186,579;
December 31, 2005 - 42,085,853
Additional paid-in capital 338,041,589 336,977,578
Accumulated deficit (286,706,651) (210,979,105)
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Total stockholders' equity 51,377,125 126,040,559
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Total liabilities and stockholders'
equity $ 61,842,601 $ 137,806,058
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