CARLSBAD, Calif.--(BUSINESS WIRE)--

International Stem Cell Corporation (OTCBB: ISCO.OB - News) (www.internationalstemcell.com) today announced financial results for the three months ended March 31, 2012.

Three Months ended March 31, 2012

Consolidated net revenues for the three months ended March 31, 2012 were $1.08 million compared to $1.52 million in the corresponding period a year ago. The year-over-year decrease in revenues is due to fewer sales generated from the Lifeline Skin Care (LSC) direct sales channel, partially offset by higher Lifeline Cell Technology (LCT) sales generated from larger distributors. LSC and LCT accounted for 51% and 49% of total revenue in the three months ended March 31, 2012 compared to 75% and 25%, respectively, in the comparable period a year ago.

For the three months ended March 31, 2012, development expenses were $3.80 million, representing a decrease of approximately 5% compared to the corresponding period in 2011. The decrease primarily reflects lower general and administrative expenses resulting from decreased stock-based compensation expense and lower laboratory-related expenses. The decrease was partially offset by higher cost of sales ratio resulting from increased sales concentration of lower margin products, and higher marketing and selling expense related to LSC. The Company continued to invest in its sales and marketing infrastructure, including significant enhancements to the e-commerce platforms, increased advertising and strengthening the sales and customer service organization.

Cash and cash equivalents at March 31, 2012 were $6.01 million compared to $1.34 million at December 31, 2011, reflecting an increase of $4.67 million resulting from two financing transactions including the issuance of shares of Series G preferred stock for $5.00 million and issuance of shares of common stock for a total of $2.08 million in the first quarter of 2012.

Q1 2012 Business Highlights:

The Company continued to focus its research and development efforts on the creation of additional parthenogenetic stem cell lines for therapeutic use and on the advancement of the disease area research programs, particularly pre-clinical in vivo safety and efficacy studies in Parkinsons disease and new methods for high-throughput cell culture and stem cell differentiation.

ISCOs wholly-owned subsidiary Lifeline Skin Care drove sales by expanding acquisition of both retail and trade customers, increasing the average order value and enhancing customer loyalty and retention. New retail customers were attracted by an increased social media presence and national exposure on TV shows such as ABCs The Talk and the use of risk-free introductory offers and free sample promotions. In addition, LSC continued to increase the number of strategic marketing partnerships. Although LSC revenue for the quarter was lower than the same period in 2011, the sales were generated from more diversified sources with much greater growth potential and reduced reliance on individual third parties.

Lifeline Cell Technology, ISCOs wholly-owned subsidiary specialized in cells and media research products, grew revenue across all three sales channels including domestic, international and OEM, showing a 39% increase over the same quarter of 2011.

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International Stem Cell Corp Announces First Quarter 2012 Financial Results and Business Highlights

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