ISONICS CORPORATION (NASDAQ: ISON)

As most of our readers will recall, StockUpTicks was one of the earliest publishers of market related news on the infinite possibilities related to nanotechnology, which in a brief phrase, is the science of the very small. This technology, as we expounded, could literally alter life as we know it and revolutionize both our lives and industry.

Our first nanotech related profile, published way back in May of 2002, was Altair Nanotechnologies (NASDAQ: ALTI) which was trading at .73 cents when first featured and saw a high of $4.40 thereafter. It currently trades in the $2.30 range.

Since then, we’ve been scouring the publicly-traded market trying to find another nanotechnology-related deal for your perusal, and at last we’ve found one to profile. Better yet, this one has a Homeland Security angle.

It isn't often that companies truly develop products and services that represent the leading edge in their respective industry, but one look at today's profile of Isonics will confirm it momentum and business savvy. 

Following on the heels of the 9/11 tragedy, management at Isonics saw the need for a better way to detect explosive and bio-chemical threats. A leader in radioisotopes and Life Sciences, Isonics acquired isotopic trace technology in 2002 that clearly positioned the company in the realm of confronting Homeland Security concerns. 

While growth driven, Isonics sticks to what it knows and what can commercially increase revenues. Its nanotechnology expertise and deep experience in the radioisotope business are responsible for the company's success in the Semiconductor Materials market. With a nexus of anti-terrorism and nanotechnology, we believe you'll find this a very worthwhile read. 
 

About Isonics

Isonics develops, commercializes, and markets stable and radioisotope-based products. These ultra-pure materials provide enhanced performance properties. In December 2002, Isonics acquired nuetron-based trace detection technology that can be used to detect explosives and chemical and biological weapons and this entry into the Homeland Security market has been a strong catalyst for the Company's revenues. 

Isonics is a recognized leader in the development of isotopically engineered semiconductor materials, and a supplier of silicon-on-insulator (SOI) wafers and isotopes for life sciences and health care applications. Isonics operates two business segments: Life Sciences and Semiconductor Materials. 

The life sciences segment sells stable and radioisotopes in elemental and simple compound forms for use in life sciences applications. Most of Isonics radioisotopes are man-made and the Company also buys these isotopes on the open market and resells them in the form of common chemical compounds.  The semiconductor materials and products segment sells silicon-on-insulator wafers and is involved in several research and development projects. 

Isonics Corporation Announces Strategic Initiatives for Fiscal Year 2005

GOLDEN, Colo.--(BUSINESS WIRE)--April 26, 2004--Isonics Corporation(NASDAQ-SMALL:ISON) (NASDAQ: ISON), a leader in the development of isotopically engineered semiconductor materials, a supplier of silicon-on-insulator (SOI) wafers and isotopes for life sciences and health care applications, announced today its Strategic Initiatives for its 2005 fiscal year. The announcement was made by James E. Alexander, chairman, president and CEO of Isonics.

Mr. Alexander stated, "With our year-end coming to a close on April 30, and Isonics' strategic plan successfully being executed, we are enthusiastically announcing our strategic initiatives - which outline what we believe to be a compelling vision for the future of the company - for the upcoming 2005 fiscal year."

Mr. Alexander continued: "We are extraordinarily enthusiastic about our early successes and the numerous milestones we have achieved to date. Most importantly, Isonics looks forward to substantial growth in revenues, earnings and, ultimately, in shareholder value."

To read the complete release on the company's 2005 initiatives, disclaimer and a summary of  Isonics successes in fiscal year 2004, Click Here.
 

KEY INVESTMENT HIGHLIGHTS • Strong senior management team from GE • Key patents and intellectual property • Loyal customer base with secure long-term contracts in place • $9.1M in sales in fiscal 2003 and growing • Rapidly growing semiconductor segment • Large upside semiconductor segment • Profitable and growing life sciences division

BUSINESS STRATEGY • Grow the Life Sciences segment by strategically re-positioning  aIsonics as a premier radio-pharmaceutical manufacturer • Further invest in Silicon-28 commercialization • Focus on SOI wafer manufacturing processes • Commit to actualize the value of its neutron detection technology  ain FY 2005

INDUSTRY DRIVERS • Need for faster, more energy efficient chips driving  asemiconductor industry to new technologies • Advances in nanotechnology shortening R&D cycles • SOI Wafer market expected to grow to $1.4 billion by 2007,  arepresenting a 10.5% CAGR. • $1.2 billion market for isotopically engineered radio-chemicals  aand radio-pharmaceuticals driven in part by growth in PET imaging  aand positive changes in medical reimbursements

Divisions & Products

As an alternative to existing silicon wafer materials, Isonics has developed a semiconductor material (Silicon-28) with superior thermal conductivity properties. In March 2003, Isonics began sampling wafers to potential customers. The semiconductor industry trend toward increased power requirements and significantly higher operating temperatures has increased the need for materials that have superior thermal conductivity properties compared to natural, multi-isotopic materials. Early tests have shown that Isonics ’ Silicon-28 solution is compatible with virtually every other heat management solution currently implemented or envisioned to date. Importantly, it does not require changing a single device design or manufacturing process because isotopically-pure semiconductor materials are essentially chemically and physically identical to naturally-occurring semiconductor materials.

 
Medical Imaging and Cannisters of oxygen-18

Isonics ’Life Sciences division markets and sells stable isotopes for the health care industry such as carbon-13 for diagnostic breath tests and drug design, and radioisotopes and stable isotopes, such as oxygen-18, for positron emission tomography (PET) imaging. Through many long-term, exclusive supply relationships in place with producers, which have developed over 10 years, Isonics distributes products made by a variety of producers around the world.      In fiscal 2005, the Company expects to triple segment revenues within three years while generating improved gross margins.

Recent News From Isonics

Isonics Corporation announced that it has closed a $3.3 million private placement of convertible preferred stock to Mercator Advisory Group, LLC, through its three designated funds, Mercator Momentum Fund, LP, Mercator Momentum Fund III, LP and Monarch Pointe Fund, Ltd., all accredited institutional investors. The Company issued 32,950 shares of newly created Series D Convertible Preferred Stock at a price of $100 per preferred share. The Series D Convertible Preferred Stock carries no coupon and may be converted into approximately 3 million common shares at a fixed price of $1.10 per share.

Isonics Corporation announced that it has signed a letter of intent to acquire the silicon wafer manufacturing business and related assets from EnCompass Materials Group Ltd. (EMG) of Vancouver, Washington. EMG manufactures silicon test wafers and provides wafer recycling services for semiconductor manufacturers. The anticipated transaction is structured as an asset purchase and is subject to completion of a definitive agreement and the usual closing conditions. The purchase price will be approximately $3.5 million consisting of a term note, Isonics common stock and the assumption of certain EMG liabilities. The parties expect the transaction to close in the second quarter of 2004.

Isonics Corporation announced that it has retained two of its current customers by extending their existing supply agreements for oxygen-18. The first extension consists of a $584,000, three-year supply agreement with a key regional supplier of positron emission tomography (PET) pharmaceuticals in the U.S. The customer has issued a purchase order in the amount of $164,000 for calendar 2004 deliveries, the first two monthly shipments of which have been delivered. The second extension consists of a two-year supply agreement for $386,000 with a U.S. university that produces PET pharmaceuticals for both research and clinical PET diagnostic procedures. Isonics has received a purchase order for the full amount of this agreement. Isonics will recognize revenue for both agreements as the product is shipped.

Isonics Co-Founders

James E. Alexander President, Chief Executive Officer and Chairman of the Board  Mr. Alexander co-founded Isonics in 1992. He has served as President, Chief Executive Officer and a Director since inception. Prior to Isonics, he served for 21 years in a variety of technology positions at General Electric in the aircraft engine and nuclear power businesses, where his last position was Manager of Technology Programs. Mr. Alexander received his Bachelors degree in Metallurgical Engineering from the University of Cincinnati, and completed graduate work in Materials Science there. He earned a Masters degree in Business Administration from Santa Clara University.

Boris Rubizhevsky Vice Chairman, Senior Vice President and Director  Mr. Rubizhevsky is also a co-founder of Isonics. He has served as Senior Vice President and a Director since inception, and became Vice Chairman in March 1997. Prior to Isonics, he owned and operated SAR Marketing for eight years, a consulting firm providing business advice and services to large multinational corporations. From 1977 to 1986, Mr. Rubizhevsky worked at General Electric as Business Development Manager in various international locations. He received his Bachelors degree in Engineering from Stevens Institute of Technology.

Isonics Management Team

Financial Highlights For Isonics

CONTACT

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