(all figures are in Canadian dollars unless otherwise noted)
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BELLEVILLE, ON, May 12 /PRNewswire-FirstCall/ - Bioniche Life Sciences Inc. (TSX: BNC), a research-based, technology-driven Canadian biopharmaceutical company, today announced financial results for its Fiscal 2010 third quarter, ended March 31, 2010.
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"The third quarter was another solid one for our Company in which further income was generated through licensing revenues from our U.S. pharmaceutical partner over and above revenues from animal health product sales," stated Graeme McRae, Chairman, President & CEO of Bioniche Life Sciences Inc.
The Company entered a partnership with Endo Pharmaceuticals Inc. (Endo) in July, 2009 for Urocidin(TM), a patented intravesical formulation of Mycobacterial Cell Wall-DNA Complex (MCC) developed by Bioniche for the treatment of non-muscle-invasive bladder cancer. A U.S. Food and Drug Administration (FDA) fast tracked Phase III registration study of the product for the refractory indication is currently underway and is expected to report results later this year. Milestone incentives under the agreement total up to US$110 million. These are linked to the achievement of future clinical, regulatory, and commercial milestones. The Company achieved the first milestone of $6.4 million (US$6.0 million) in October, 2009, and achieved two additional milestones in February, 2010 amounting to $8.3 million (US$8.0 million).
Fiscal 2010 Q3 Financial Results Highlights
Consolidated revenues for the quarter totalled $15.6 million, an increase of $8.2 million, or 111%, over the same period in Fiscal 2009. This figure includes $9.5 million in licensing and research collaboration revenues, in the form of payments to Bioniche from Endo for milestones achieved in the period. This positive result is somewhat offset by decreased sales of Animal Health products in the quarter as compared to last year. The sales decrease relates to recessionary conditions in all markets and the effect of unfavourable foreign exchange rate changes related to the high percentage of products that are exported by the Company.
Gross profit on product sales totalled $3.0 million in the quarter, as compared to $4.1 million in the same quarter last year. Gross profit as a percentage of product sales totalled 49.3% this quarter, compared to 54.9% in the third quarter of Fiscal 2009. The decrease is primarily due to recessionary effects on product sales.
For the quarter ended March 31, 2010, expenses before research and development totalled $7.2 million, as compared to $7.3 million in the same quarter last year. Management expects sales and marketing costs to increase over the remainder of Fiscal 2010 to sustain and grow the business.
Gross research and development (R&D) expenses in this quarter totalled $5.1 million, compared to $3.6 million for the same period in Fiscal 2009. The majority of these costs can be attributed to the ongoing Phase III clinical program for the Company's Urocidin(TM) bladder cancer treatment and to an increased focus on the development of animal health reproduction products and vaccines.
The basic and fully-diluted net gain per share for the second quarter of Fiscal 2010 was $0.06, compared to a loss per share of ($0.04) for the corresponding period in Fiscal 2009. Total common shares outstanding at March 31, 2010 were 72,499,759 as compared to 71,532,411 for the corresponding period in Fiscal 2009.
Earnings before interest, taxes, depreciation, amortization and foreign exchange (before research and development) during the third quarter of Fiscal 2010 were $9.2 million, as compared to $1.1 million for the same period in Fiscal 2009, a 736% increase. This significant increase relates to the intake of licensing milestone revenue in the quarter.
At March 31, 2010, the Company's net working capital totalled $22.5 million including $15.5 million in cash, excluding the current portion of non-refundable deferred licensing revenue, as compared to negative working capital of ($0.5 million) at June 30, 2009.
Long-term liabilities at March 31, 2010 totalled $10.5 million, excluding non-refundable deferred licensing revenue of $19.7 million, which compares to $8.2 million reported at June 30, 2009. The increase reflects the long-term portion of the required repayment of government assistance to the Industrial Technologies Office (ITO - formerly TPC) of $3.2 million, less repayments of capital leases and long-term debt. The up-front payment related to the licensing agreement with Endo is reflected as non-refundable deferred licensing revenue, the current portion being $1.5 million and long-term portion - $19.7 million. The total revenue received was $22.3 million, which will be brought into income over the next 15 years.
About Bioniche Life Sciences Inc.
Bioniche Life Sciences Inc. is a research-based, technology-driven Canadian biopharmaceutical company focused on the discovery, development, manufacturing, and marketing of proprietary products for human and animal health markets worldwide. The fully-integrated company employs approximately 200 skilled personnel and has three operating divisions: Human Health, Animal Health, and Food Safety. The Company's primary goal is to develop proprietary cancer therapies supported by revenues from marketed products in human and animal health. For more information, please visit www.Bioniche.com or www.sedar.com.
Except for historical information, this news release may contain forward-looking statements that reflect the Company's current expectation regarding future events. These forward-looking statements involve risk and uncertainties, which may cause, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process, and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting.
Bioniche Life Sciences Inc. Amalgamated under the laws of Ontario INTERIM CONSOLIDATED BALANCE SHEETS (Unaudited) As at As at March 31, June 30, 2010 2009 (thousands of Canadian dollars) $ $ ------------------------------------------------------------------------- ASSETS Current Cash and cash equivalents 15,428 5,950 Accounts receivable 5,617 3,720 Inventories 7,069 5,408 Prepaid expenses and deposits 1,877 569 Income and other taxes recoverable 98 - Restricted cash 53 1,227 ------------------------------------------------------------------------- 30,142 16,874 ------------------------------------------------------------------------- Long-term Property, plant and equipment 11,690 9,494 Intangible assets 6,172 6,792 Goodwill 456 456 Long-term accounts receivable 1,124 1,025 ------------------------------------------------------------------------- 49,584 34,641 ------------------------------------------------------------------------- ------------------------------------------------------------------------- LIABILITIES AND SHAREHOLDERS' EQUITY Current Revolving credit facility - 4,448 Accounts payable and accrued liabilities 6,231 11,607 Income and other taxes payable - 321 Deferred government assistance 28 342 Current portion of long-term debt and obligations under capital leases 700 635 Current portion of repayable government assistance 943 - Current portion of non-refundable deferred licensing revenue 1,486 - ------------------------------------------------------------------------- 9,388 17,353 ------------------------------------------------------------------------- Long-term Long-term debt 878 1,149 Obligations under capital leases 1,125 1,225 Repayable government assistance 6,072 2,476 Deferred government incentives 2,414 3,335 Non-refundable deferred licensing revenue 19,724 - ------------------------------------------------------------------------- 39,601 25,538 ------------------------------------------------------------------------- Shareholders' equity Share capital 96,323 95,855 Other paid-in capital 8,695 8,540 Deficit (95,035) (95,292) ------------------------------------------------------------------------- 9,983 9,103 ------------------------------------------------------------------------- 49,584 34,641 ------------------------------------------------------------------------- ------------------------------------------------------------------------- Bioniche Life Sciences Inc. INTERIM CONSOLIDATED STATEMENTS OF INCOME (LOSS), COMPREHENSIVE INCOME (LOSS), AND DEFICIT (Unaudited) For the three and nine months ended March 31 Current Current Last Year Year Last Year (thousands of Canadian Quarter Quarter to Date to Date dollars, except share 2010 2009 2010 2009 and per share amounts) $ $ $ $ ------------------------------------------------------------------------- REVENUE Sales 6,129 7,352 19,064 23,947 Gain on sale of intangible assets - - 883 - Research collaborations 758 - 758 - Licensing 8,742 - 15,832 - ------------------------------------------------------------------------- 15,629 7,352 36,537 23,947 ------------------------------------------------------------------------- EXPENSES Cost of sales (excluding amortization) 3,109 3,316 9,174 10,529 Administration 1,718 1,614 5,149 4,711 Marketing and selling 1,557 1,316 4,507 4,741 Financial expenses 163 511 515 1,738 Amortization of property, plant and equipment 242 333 809 1,009 Amortization and writedown of intangible assets 189 199 620 608 Foreign exchange loss 242 35 506 72 ------------------------------------------------------------------------- 7,220 7,324 21,280 23,408 ------------------------------------------------------------------------- Income before research and development expenses and other items 8,409 28 15,257 539 Research and development expenses, gross 5,092 3,565 13,246 10,596 Repayable government assistance - - 3,884 - Less: government incentives, net (1,067) (424) (2,260) (1,430) ------------------------------------------------------------------------- Income (loss) before income taxes 4,384 (3,114) 387 (8,627) Provision for income taxes (recovery) - (61) 130 116 ------------------------------------------------------------------------- Net income (loss) and comprehensive income (loss) for the period 4,384 (3,053) 257 (8,743) Transition adjustment due to change in accounting policy - - - (39) Deficit, beginning of period (99,419) (90,481) (95,292) (84,752) ------------------------------------------------------------------------- Deficit, end of period (95,035) (93,534) (95,035) (93,534) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Basic and diluted net income (loss) per share 0.06 (0.04) 0.00 (0.13) ------------------------------------------------------------------------- ------------------------------------------------------------------------- Weighted-average number of common shares outstanding 72,349,969 71,411,362 72,075,862 69,863,738 Weighted-average fully-diluted number of common shares 73,787,191 71,411,362 73,147,266 69,863,738 Bioniche Life Sciences Inc. INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) For the three and nine months ended March 31 Current Current Last Year Year Last Year Quarter Quarter to Date to Date (thousands of Canadian 2010 2009 2010 2009 dollars) $ $ $ $ ------------------------------------------------------------------------- OPERATING ACTIVITIES Net income (loss) for the period 4,384 (3,053) 257 (8,743) Add (deduct) non-cash items: Amortization 431 532 1,377 1,616 Unrealized foreign exchange loss (gain) (7) 233 (32) 600 Change in unrealized loss on foreign currency embedded derivatives - - - 60 Accreted interest on discounted receivables and interest-free loans and amortization of financial expenses 104 165 315 1,112 Stock-based compensation 63 60 173 185 Employee share ownership plan 200 166 337 506 Government assistance obligation - - 3,884 - Amortization of deferred government incentive (464) - (1,308) - Licensing revenue (372) - (1,076) - Write-off of intangible assets - - 52 - Gain on sale of intangible assets - - (883) - Deemed government assistance - - (73) - ------------------------------------------------------------------------- 4,339 (1,897) 3,023 (4,664) Decrease (increase) in restricted cash 138 (1,440) 1,174 (1,440) Net change in non-cash working capital balances (1,849) (783) (7,877) (587) Net change in non- refundable deferred licensing revenue - - 22,286 - ------------------------------------------------------------------------- Cash provided by (used in) operating activities 2,628 (4,120) 18,606 (6,691) ------------------------------------------------------------------------- INVESTING ACTIVITIES Government incentives received on account of property, plant and equipment 135 7 186 60 Proceeds on sale of intangible assets - - 606 - Proceeds on disposal of property, plant and equipment - - 6 - Purchases of property, plant and equipment (2,283) (152) (3,659) (675) ------------------------------------------------------------------------- Cash used in investing activities (2,148) (145) (2,861) (615) ------------------------------------------------------------------------- FINANCING ACTIVITIES Proceeds from deferred government incentives - 332 - 434 Proceeds from repayable government assistance 691 1,597 744 2,373 Payment of financing fees - revolving credit facility - - (2,117) (11) Proceeds from exercise of stock options 72 - 72 - Proceeds from revolving credit facility - 6,201 - 23,177 Repayment of revolving credit facility - (6,361) (4,416) (19,627) Repayment of capital lease obligations (24) (100) (259) (230) Repayment of senior and other long-term debt (141) (139) (291) (310) ------------------------------------------------------------------------- Cash provided by (used in) financing activities 598 1,530 (6,267) 5,806 ------------------------------------------------------------------------- Net increase in cash and cash equivalents during the period 1,078 (2,735) 9,478 1,500 Cash and cash equivalents, beginning of period 14,350 5,634 5,950 4,399 ------------------------------------------------------------------------- Cash and cash equivalents, end of period 15,428 2,899 15,428 ------------------------------------------------------------------------- -------------------------------------------------------------------------
SOURCE Bioniche Life Sciences Inc.
