International Stem Cell Corporation Announces First Quarter 2013 Financial Results and Provides Business Update

CARLSBAD, CA--(Marketwired - May 14, 2013) - International Stem Cell Corporation (OTCQB: ISCO) (www.internationalstemcell.com) ("ISCO" or "the Company"), a California-based biotechnology company developing novel stem cell based therapies, today announced financial results for the three months ended March 31, 2013.

"We've made excellent progress in the first quarter, showing, for the first time, how neuronal cells developed from our unique and powerful stem cell platform can be used to treat Parkinson's disease in the most widely accepted primate model of the disease, and presenting these results at one of the most important neurology conferences in the world," said Dr. Andrey Semechkin, the Company's CEO and Co-Chairman. "We have also published our innovative and efficient new method of creating these neuronal cells in a well respected peer-reviewed scientific journal, further consolidating ISCO's leadership position," continued Dr. Semechkin.

"In addition, the strong sales growth achieved by our subsidiaries confirms that the sales and marketing tactics we have been implementing are starting to deliver the results we anticipated and begin to partially offset our core Research and Development expenses. At the same time we continue to challenge ourselves to become ever more efficient and this continued vigilance is reflected in both the reduced general and administrative expenses and increased gross margin."

Q1 2013 Highlights:

Three Months Ended March 31, 2013

Revenue for the three months ended March 31, 2013 were $1.29 million, an increase of approximately 19% compared to $1.08 million for the same period in 2012.Sales for Lifeline Skin Care (LSC) and Lifeline Cell Technology (LCT) increased by 19% and 20%, respectively.LSC and LCT accounted for 51% and 49% of total revenue in the three months ended March 31, 2013, respectively.

Cost of sales was $0.33 million, or 26% of revenue, compared to $0.32 million or 30% of revenue for the same period in 2012. Gross margins improved as a result of efficiencies in our manufacturing and supply chain and increased sales contribution from higher margin products.

General and administrative expenses fell by 30% to $1.42 million, driven primarily by lower personnel-related expenses resulting from lower headcount, lower stock-based compensation expenses and lower professional and corporate expenses.Marketing expenses increased 3% compared to the first quarter of 2012 to $0.51 million, primarily reflecting higher spending on advertising and promotions for the Company's skin care business.

Cash and cash equivalents totaled $1.91 million at March 31, 2013 compared to $0.65 million as of December 31, 2012. The Company received approximately $3.27 million, net of stock issuance costs, from the issuance of 16,325,000 shares of common stock in the first quarter of 2013. The Company invested approximately $0.17 million in capital expenditures in the first three months of 2013 compared to $0.22 million in the same period in 2012.

Conference Call and Webcast Details:

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International Stem Cell Corporation Announces First Quarter 2013 Financial Results and Provides Business Update