OREANDA-NEWS. OJSC HSCI - The Human Stem Cells Institute ("HSCI", MOEX: ISKJ), one of Russia's leading biotech companies, announced its unaudited unconsolidated results for the first nine months of 2014 in accordance with the Russian Accounting Standards (RAS):

HSCI's revenue for the first nine months of 2014 amounted to RUB 234.4 million, compared to RUB 333.1 million in the same period of the previous year.

Gross profit amounted to RUB 84.8 million representing gross margin of 36.2%; operating loss amounted to RUB 0.2 million.

OIBDA1 amounted to RUB 11.8 million; OIBDA margin was 5.0%.

Net profit for the first nine months of 2014 amounted to RUB 17.9 million. Net profit margin was 7.7%.

General Director of HSCI Artur Isaev commented:

"Our Company is working very actively, and despite the signs of economic crisis on consumer and capital markets, we hope to maintain development dynamics and drive the Company's growth. Recently, we have reacted to the upcoming economic crisis by several changes and took restructuring initiatives in in the Company. We cut costs, including by reducing the size of the office premises we rent, the number of administrative personnel and saving the overall staff costs. We also conducted an internal division of our projects by business units. Some of our employees who are focused on research and development are being transferred to HSCI's subsidiary companies who are residents of the Skolkovo Innovation Center. We are creating a separate company which will operate on a cord blood banking market. This will give us the opportunity to use those tax and other incentives that the government provides for companies which conduct medical and R&D activities making it possible for us to fulfill our plans more effectively.

We continue to focus on developing our products and services on new markets, and on expanding the indications for the application of Neovasculgen® - our innovative drug. We're working actively at gaining access to the markets and promoting our services. The Company's projects offer investors a good chance investment opportunity. We have positive outlook for the future of our products and services, and we are very active in working with investors as we see growth prospects despite the current difficult situation on capital markets."

HSCI revenue and income generated by key products and services

Revenue generated by OJSC HSCI (hereafter - "HSCI", "The Company") in the first nine months of 2014 amounted to RUB 234.387 million, which is down 29.6% compared to the same period of the previous year.

The decrease is primarily attributable to lower revenues received from the sales of Neovasculgen®. In 9mo 2013 revenues from the sale of the drug to distributors amounted to RUB 143.5 million (as reflected in corresponding press release), while in the reported period they decreased to RUB 42.4 million. However it should be noted that in accordance with the restatements made for the Full Year 2013, the revenue from the sales of the Neovasculgen® for the first 9 months of 2013 due to be retrospectively restated to RUB 125.4 million (for the amount of credit note, as it is reflected in Other expenses).