BioAmber Inc. Reports Second Quarter 2016 Financial Results

Aug 9, 2016

MONTREAL, Aug. 9, 2016 /CNW Telbec/ - BioAmber Inc. (NYSE: BIOA), a leader in renewable materials, today announced operational and financial results for the three months ending June 30, 2016. 

"BioAmber continues to meet ramp-up expectations at its Sarnia plant. We have made excellent progress in the plant's reliability and performance, while continuing to increase production levels and drive down unit costs," said Jean-Francois Huc, BioAmber's Chief Executive Officer.   "Second quarter sales were on track, generating a 73% increase in sales over Q1, while Q2 operations improved throughout the quarter, culminating in a June uptime rate of over 80%.  The team is now entrenching its operating routines as our Sarnia facility moves towards full production levels," he added.

Operational Highlights

  • Sales of bio-succinic acid in the quarter were $2.5 million, an increase of 73% over the previous quarter and an increase of 637% compared to the same period last year
  • The cost per ton of bio-succinic acid sold continued to decrease, with a 30% reduction relative to the previous quarter, and Sarnia variable costs were lowered to the Company's 2016 target
  • Sarnia achieved an uptime rate of over 80% in the month of June 2016, having increased steadily during the second quarter
  • Less than 7% of total bio-succinic acid produced in Sarnia during the second quarter was off-spec, compared to 37% of bio-succinic acid production that was off spec in the previous quarter
  • Finished product inventory increased to 1,200 metric tons at the end of the second quarter
  • The Company did not have a lost time injury during the quarter and has not had a lost-time injury dating back to the beginning of construction in Sarnia.

Financial Highlights

  • Cash on hand was $5.5 million as of June 30th, 2016, compared to cash on hand of $6.9 million on December 31, 2015
  • After the end of the quarter the Company closed on an additional $7.6 million from the previously disclosed BDC Capital loan
  • Gross loss in the second quarter was reduced by 40% compared to the previous quarter

Q2 2016 Financial Results

Revenues for the quarter ended June 30, 2016 were $2.5 million, an increase of 73% over the previous quarter. The increase in revenue was entirely attributed to volume growth, with no material change in the average selling price.

Gross loss for the quarter ended June 30, 2016 was $1.0 million, compared to $410,000 for the same period last year and $1.6 million for the previous quarter. The decrease in gross loss relative to the previous quarter was due to the greater volume of succinic acid produced and sold, improvements in operational efficiency and a reduction in the quantity of off-spec product produced. 

Research and development expenses for the quarter ended June 30, 2016 decreased to $1.5 million from $5.0 million for the same period last year. The higher costs recorded last year were the result of certain commissioning and start-up costs incurred in the quarter and recorded as research and development expenses. There was also a reduction in research costs in Q2 2016 relative to Q2 2015 due to the fact that the technology is now operating in a commercial facility.

Sales and marketing expenses for the quarter ended June 30, 2016 decreased to $584,000 from $1.1 million for the same period last year. This was driven by a decrease in stock-option compensation expenses due to stock-options granted in 2016 with a lower fair value and a decrease in salaries and benefits in the first quarter of 2016.

General and administrative expenses for the quarter ended June 30, 2016 were unchanged at $3.0 million, compared to the same period last year.

Depreciation of property and equipment and amortization of intangible asset expense increased to $1.2 million for the quarter ended June 30, 2016 from $93,000 for the same period last year. This increase was due to the depreciation of Sarnia facility assets following the beginning of production.

For the quarter ended June 30, 2016, the Company incurred net financial income of $11.3 million, compared to a charge of $3.8 million for the same period last year.  There was a financial charge of $662,000 resulting from interest expense on long-term loans, which was offset by a non-cash gain of $11.9 million related to changes in the fair market value of the warrants issued in connection with the Company's initial public offering (IPO Warrants) and warrants issued in 2009 and 2011 (Legacy Warrants).

The Company recorded a net income attributable to BioAmber Inc. shareholders of $4.8 million, or an income of $0.17 per share for the quarter ended June 30, 2016, compared to a net loss of $14.0 million, or a loss of $0.58 per share for the same period last year.

The Adjusted Net Loss Attributable to BioAmber Inc. Shareholders for the quarter ended June 30, 2016 was $7.1 million, or a loss of $0.25 per share, compared to an Adjusted Net Loss Attributable to BioAmber Inc. Shareholders of $9.5 million, or a loss of $0.39 per share for the same period last year.  Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a non-GAAP financial metric that excludes, for the quarter ended June 30, 2016, the impact of the change in fair value of the IPO and Legacy Warrants. The Adjusted Net Loss Attributable to BioAmber Inc. Shareholders excludes, for the quarter ended June 30, 2015, the impact of the change in fair value of the IPO and Legacy warrants, the non-cash inventory reserve expense and the intangible asset impairment related to DuPont technology.

Please refer to Annex A: "Non-GAAP Financial Information—Adjusted Net Loss Attributable to BioAmber Inc. Shareholders" for more information regarding this non-GAAP financial metric.

Webcast and Conference Call Information

BioAmber will discuss these results on a live audio webcast, which will be available on the Internet to investors, members of the news media and the general public at 4:30 p.m. Eastern Time on August 9, 2016. To access the webcast of the conference call, go to the company's website, www.bio-amber.com.   Audio of the teleconference is also available by dialing: 

North American callers:  +1 (888) 390-0546     International callers: (416) 764-8688

Teleconference replays will be available through August 16, 2016: Domestic: 1-888-390-0541 International: 416-764-8677   Passcode: 138284#   A replay of the webcast will also be available approximately two hours after the conclusion of the live webcast on BioAmber's website, for a period of 30 days.

About BioAmber

BioAmber (NYSE: BIOA) is a renewable materials company. Its innovative technology platform combines biotechnology and catalysis to convert renewable feedstock into building block materials that are used in a wide variety of everyday products including plastics, paints, textiles, food additives and personal care products.  For more information visit www.bio-amber.com

Forward-Looking Statements

This press release contains forward-looking statements, including statements related to the beginning of our commercial operations and the ramping-up of our sales for our Sarnia Bio-SA facility.   All statements other than statements of historical fact contained in this press release are forward-looking statements.  These statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "seek," "will," "may" or similar expressions.  Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond BioAmber's control.  BioAmber's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors. 

Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee that the events and circumstances reflected in the forward-looking statements will be achieved or occur and the timing of events and circumstances and actual results could differ materially from those projected in the forward-looking statements. Accordingly, you should not place undue reliance on these forward-looking statements.  All such statements speak only as of the date made, and the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.  For additional disclosure regarding these and other risks faced by BioAmber, see disclosures contained in BioAmber's public filings with the SEC including, the "Risk Factors" section of BioAmber's most recent Annual Report on Form 10-K and the recent quarterly reports on Form 10-Q.

 

BioAmber Inc.

     

Consolidated Statement of Operations

     

(unaudited, in thousands)

     
       
 

Three Months ended June 30,

 

2016

 

2015

           

Product sales

$

2,521

 

$

342

Cost of goods sold

 

3,481

   

752

 

Gross loss

 

(960)

   

(410)

Operating expenses

         
   

General and administrative

 

2,985

   

2,964

   

Research and development, net

 

1,523

   

4,960

   

Sales and marketing

 

584

   

1,124

   

Depreciation of property and equipment

 

1,238

   

93

   

Write-off of intangible assets

 

   

1,141

   

Foreign exchange loss

 

25

   

202

Operating expenses

 

6,355

   

10,484

Operating loss

 

(7,315)

   

(10,894)

Amortization of debt discounts

 

839

   

92

Financial charges (income), net

 

(11,296)

   

3,782

Other expense (income), net

 

197

   

Income (loss) before income taxes

 

2,945

   

(14,768)

Income taxes

 

12

   

11

Net income (loss)

 

2,933

   

(14,779)

Net income (loss) attributable to:

         
 

BioAmber Inc. shareholders

 

4,811

   

(13,979)

 

Non-controlling interest

 

(1,878)

   

(800)

   

2,933

   

(14,779)

           

Basic net earnings (loss) per share attributable to BioAmber Inc. shareholders

 

0.17

   

(0.58)

           

Weighted-average of common shares outstanding -  basic

 

28,782

   

24,283

 

BioAmber Inc.

     

Consolidated Balance Sheet Information

     

(unaudited, in thousands)

     
 

As of
June 30,
2016

 

As of
December 31,
2015

Assets

$

 

$

Current assets:

     

Cash and cash equivalents

5,543

 

6,974

Accounts receivable

2,192

 

979

Inventories

2,850

 

1,749

Prepaid expenses and other current assets

1,354

 

1,142

 

Total current assets

11,939

 

10,844

Property and equipment, net

128,201

 

122,543

Investment in cost and equity method investment

447

 

447

Intangible assets including goodwill

6,865

 

6,977

Restricted cash

577

 

541

Deferred financing costs

662

 

435

   

Total assets

148,691

 

141,787

       

Liabilities

     

Current Liabilities:

     

Accounts payable and accrued liabilities

5,118

 

15,834

Income taxes payable

119

 

112

Deferred grants

3,670

 

3,438

Short-term portion of long term debt

10,242

 

10,297

 

Total current liabilities

19,149

 

29,681

Long-term debt

26,521

 

28,492

Warrants financial liability

3,123

 

12,232

Other long term liabilities

452

 

443

   

Total liabilities

49,245

 

70,848

Redeemable non-controlling interest

41,188

 

24,584

Shareholders' Equity

58,258

 

46,355

Total Liabilities and Shareholders' Equity

148,691

 

141,787

 

BioAmber Inc.

     

Consolidated Statements of Cash Flows

     

(unaudited, in thousands)

     
       
 

Six months ended June 30,

 

2016

 

2015

 

$

 

$

Operating Activities

     
   

Net loss

(9,603)

 

(23,888)

     

Adjustments to reconcile net loss to cash:

     
     

Stock-based compensation

1,778

 

3,013

     

Depreciation and amortization

2,392

 

165

     

Write-off intangible assets

 

1,141

     

Loss on disposals of property and equipment

177

 

     

Amortization of debt discounts

1,441

 

158

     

Other long-term liabilities

(9)

 

25

     

Financial charges (income), net

(9,346)

 

3,173

     

Changes in operating assets and liabilities

(12,505)

 

642

 

Net cash used in operating activities

(25,675)

 

(15,571)

       

Investing activities

     
   

Acquisition of property and equipment and intangible asset, net of disposals

(364)

 

(52,433)

   

Investment in equity method and cost investments

 

(413)

 

Net cash used in investing activities

(364)

 

(52,846)

       

Financing activities

     
   

Deferred financing costs

(571)

 

(490)

   

Issuance of long-term debt

 

21,967

   

Repayment of long-term debt

(4,840)

 

   

Government grants

 

7,947

   

Net proceeds from issuance of common shares

29,585

 

37,416

 

Net cash provided by financing activities

24,174

 

66,840

Foreign exchange impact on cash

434

 

(801)

Decrease in cash and cash equivalents

(1,431)

 

(2,378)

Cash and cash equivalents, beginning of period

6,974

 

51,043

Cash and cash equivalents, end of period

5,543

 

48,665

 

ANNEX A: Non-GAAP Financial Information

Adjusted Net Loss Attributable to BioAmber Inc. Shareholders

BioAmber presents Adjusted Net Loss Attributable to BioAmber Inc. Shareholders as a supplemental measure of BioAmber's performance.  Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a non-GAAP financial metric that excludes, for the quarter ended June 30, 2016, the impact of the change in fair value of the IPO warrants and the Legacy Warrants. Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a non-GAAP financial metric that excludes, for the quarter ended June 30, 2015, the impact of the change in fair value of the IPO warrants and the Legacy Warrants, the non-cash inventory reserve expense and the intangible asset impairment related to DuPont technology. The above items are excluded from BioAmber's Adjusted Net Loss Attributable to BioAmber Inc. Shareholders because these items are non-cash in nature, or because the amount and timing of these items are either unpredictable or not driven by current operating results and renders comparisons with prior periods and competitors less meaningful.  BioAmber believes Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a useful measure for analysts and investors to evaluate BioAmber's future ongoing performance as this measure allows for a more meaningful comparison of BioAmber's projected cash earnings and performance with its historical results from prior periods and to the results of its competitors.  Adjusted Net Loss Attributable to BioAmber Inc. Shareholders corresponds more closely to the cash operating income generated from BioAmber's business and allows investors to gain an understanding of the factors and trends affecting the ongoing cash earnings capabilities of BioAmber's business.

Adjusted Net Loss Attributable to BioAmber Inc. Shareholders has certain limitations in that it does not take into account the impact of certain expenses to BioAmber's consolidated statements of operations.  In evaluating Adjusted Net Loss Attributable to BioAmber Inc. Shareholders, you should be aware that in the future BioAmber may incur expenses similar to the adjustments in this presentation. BioAmber's presentation of Adjusted Net Loss Attributable to BioAmber Inc. Shareholders should not be construed as an inference that BioAmber's future results will be unaffected by unusual or non-recurring items. Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is not a measurement of BioAmber's financial performance under GAAP and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP.

 

 

BioAmber Inc.

       

Non-GAAP Financial Information

       

(unaudited, in thousands, except for share data)

       
   

Three Months ended June 30,

   

2016

 

2015

   

$

 

$

Net income (loss) attributable to BioAmber Inc.  Shareholders

 

4,811

 

(13,979)

Adjustment:

       
 

Warrants revaluation (income) expense

 

(11,943)

 

3,010

 

Intangible impairment

 

 

1,141

 

Inventory reserve

 

 

300

Adjusted net loss attributable to BioAmber Inc. shareholders

 

(7,132)

 

(9,528)

         

Adjusted net loss per share attributable to BioAmber Inc. shareholders - basic

 

(0.25)

 

(0.39)

         

Weighted-average of common shares outstanding- basic

 

28,782

 

24,283

 

SOURCE BioAmber Inc.

For further information: BioAmber Investor Contact: Mike Hartmann, Executive Vice President, 514-844-8000 Ext. 120, mike.hartmann@bio-amber.com


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