LOS ANGELES, Aug. 9, 2017 /PRNewswire/ -- Stellar
Biotechnologies, Inc. (Nasdaq: SBOT), a leading manufacturer of a
key protein utilized in multiple immunotherapy development
pipelines, today reported financial results for the three and nine
months ended June 30, 2017 and
provided an update on its business.
During the first nine months of the year, the company reported
continuing progress across its initiatives to optimize and expand
its manufacturing capacity at its primary production facility in
California. Stellar's current
manufacturing systems, which were originally developed to provide
clinical-stage quantities of its KLH carrier molecule, currently
support multiple KLH therapies in advanced clinical studies. These
studies include Alzheimer's disease, lupus and metastatic
breast cancer.
"We now have multiple customers with Phase 2 clinical studies
that are fully enrolled and underway, and we are preparing for the
impact that favorable clinical results could have on the KLH market
and our supply capabilities," said Stellar President and CEO
Frank Oakes. "We plan to
incrementally increase our production capacity and manufacturing
capabilities in line with the needs
of our customers and to maintain our leadership position in the
sustainable production of controlled, fully traceable KLH."
Stellar Chief Financial Officer Kathi
Niffenegger noted that research and development activities
increased under the company's optimization plan for the three and
nine months ended June 30, 2017. "In
the third quarter, we continued the trend of prudently managing our
working capital. We reduced corporate expenses and redirected
resources to continue the ramp up of our development activities. In
addition to the operational
benefits of increased throughput capacity, we believe these
optimizations will favorably impact our financial metrics at the
higher production volumes needed for commercial drug launches."
Financial Results
Three months ended June 30,
2017
Total revenues were $0.02 million
for the quarter ended June 30, 2017
compared to $0.18 million for same
period last year. The change was due to a decrease in product sales
volume. While the company's customer base has not changed
significantly, product sales volumes are subject to variability
associated with the rate of development and progression of clinical
studies of third-party products that utilize Stellar KLH. For the
three months ended June 30, 2017,
product sales consisted of lower volume orders for pre-clinical
studies and immune system assays. For the three months ended
June 30, 2016, product sales
primarily consisted of higher volume orders for later stage
clinical studies. The rate of progression towards later stage
studies is expected to continue to affect the timing and volume of
future product sales.
Total expenses decreased by $0.06
million to $1.31 million for
the quarter ended June 30, 2017,
compared to $1.37 million for the
same period last year.
- Costs of sales and contract services decreased by $0.04 million to $0.08
million for the quarter ended June
30, 2017, compared to $0.12
million for the same period last year primarily due to
decreased product sales.
- Research and development expenses increased by $0.07 million to $0.54
million for the quarter ended June
30, 2017, compared to $0.47
million for the same period last year. The increase was
primarily due to research and development activities intended to
increase the scalability and throughput capacity of existing
manufacturing systems; improvements in analytical, manufacturing,
and purification processes; stability studies; and formulation
development.
- General and administrative expenses decreased by $0.08 million to $0.64
million for the three months ended June 30, 2017 compared to $0.72 million for the same period last year
primarily due to management's actions to reduce corporate expenses,
including travel and professional fees, as well as lower legal fees
and public company expenses.
For the third quarter of fiscal year 2017, Stellar reported a
net loss of $1.22 million, or
$0.12 per basic share, compared to a
net loss of $1.19 million, or
$0.14 per basic share, for the same
period last year.
Nine months ended June 30,
2017
Total revenues were $0.23 million
for the nine months ended June 30,
2017 compared to $1.0 million
for the same period last year. The change was primarily due to a
decrease in product sales. While the company's customer base has
not changed significantly, product sales volumes are subject to
variability associated with the rate of development and progression
of clinical studies of third-party products that utilize Stellar
KLH. For the nine months ended June 30,
2017, product sales consisted of KLH for clinical and
pre-clinical studies and immune system assays. For the nine months
ended June 30, 2016, product orders
primarily consisted of higher volume orders for later stage
clinical studies. Total revenues were also impacted by a decrease
in the number of significant customers who purchased the company's
products and services, with two customers representing 85% of total
revenue for the current period compared to five customers
representing 91% of total revenue for the same period last
year.
Total expenses decreased by $0.51
million to $4.08 million for
the nine months ended June 30, 2017
compared to $4.59 million for the
same period last year.
- Costs of sales and contract services decreased by $0.47 million to $0.23
million for the nine months ended June 30, 2017 compared to $0.70 million for the same period last year
primarily due to decreased product sales.
- Research and development expenses increased by $0.26 million to $1.33
million for the nine months ended June 30, 2017 compared to $1.07 million for the same period last year. The
increase was primarily due to research and development activities
intended to increase the scalability and throughput capacity of
existing manufacturing systems; improvements in analytical,
manufacturing, and purification processes; stability studies; and
formulation development.
- General and administrative expenses decreased by $0.28 million to $2.31
million for the nine months ended June 30, 2017 compared to $2.60 million for the same period last year
primarily due to management's actions to reduce corporate expenses,
including travel and professional fees, as well as lower legal fees
and public company expenses.
For the first nine months of fiscal year 2017, Stellar reported
a net loss of $3.81 million, or
$0.38 per basic share, compared to a
net loss of $3.68 million, or
$0.44 per basic share, for the same
period last year.
Working Capital
At June 30, 2017, the company had
working capital of approximately $7.69
million. Cash, cash equivalents and short-term investments
totaled $7.65 million.
Additional Information
Stellar will file its Form 10-Q for the quarter ended
June 30, 2017 with the Securities and
Exchange Commission on August 9,
2017. To view the company's filings, visit the website of
the Securities and Exchange Commission at www.sec.gov. To view the
company's filings with the Canadian Securities Administrators
(CSA), including the Management Discussion and Analysis and related
consolidated financial statements, visit the CSA's SEDAR website at
www.sedar.com.
About Stellar Biotechnologies
Based north of Los Angeles at
the Port of Hueneme, Stellar Biotechnologies, Inc. (Nasdaq: SBOT)
is the leader in sustainable manufacture of Keyhole Limpet
Hemocyanin (KLH), an important immune-stimulating protein used in
wide-ranging therapeutic and diagnostic markets. KLH is both an
active pharmaceutical ingredient (API) in many new immunotherapies
(targeting cancer, immune disorders, Alzheimer's and inflammatory
diseases) as well as a finished product for measuring immune
status. Stellar is unique in its proprietary methods, facilities,
and KLH technology. The company is committed to meeting the growing
demand for commercial-scale supplies of GMP grade KLH, ensuring
environmentally sound KLH production, and developing KLH-based
active immunotherapies. Stellar KLH is a trademark of Stellar
Biotechnologies.
Follow Stellar: LinkedIn | Twitter | Facebook | Google+
Stellar Forward-Looking Statements
This press release may contain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Forward-looking statements may be identified by the use of
words such as "anticipate," "believe," "plan," "estimate,"
"expect," "intend," "may," "will," "would," "could," "should,"
"might," "potential," or "continue" and variations or similar
expressions. Readers should not unduly rely on these
forward-looking statements, which are not a guarantee of future
performance. There can be no assurance that forward-looking
statements will prove to be accurate, as all such forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause actual results or future events to differ
materially from the forward-looking statements. Such risks include,
but may not be limited to: general economic and business
conditions; technology changes; competition; changes in strategy or
development plans; availability of funds and resources; anticipated
requirements for operating capital; governmental regulations and
the ability or failure to comply with governmental regulations;
changes in trade policy and international law; the timing of
Stellar's or its partners' anticipated results, including in
connection with clinical trials; the ability to meet the goals of
Stellar's joint ventures and strategic partnerships; and other
factors referenced in Stellar's filings with securities regulators.
For a discussion of further risks and uncertainties related to the
Stellar's business, please refer to Stellar's public company
reports filed with the U.S. Securities and Exchange Commission and
the British Columbia Securities Commission. All forward-looking
statements are made as of the date hereof and are subject to
change. Except as required by law, Stellar assumes no obligation to
update such statements. This press release does not constitute an
offer or solicitation of an offer for sale of any securities in any
jurisdiction, including the United
States.
Condensed Interim
Consolidated Statements of Operations
|
(Unaudited - Prepared
by Management)
|
(Expressed in US
Dollars)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
Nine Months
Ended
|
|
|
|
June
30,
|
June 30,
|
June
30,
|
June 30,
|
|
|
|
2017
|
2016
|
2017
|
2016
|
|
|
|
|
|
|
|
Revenues:
|
|
|
|
|
|
Product
sales
|
$
20,532
|
$
181,092
|
$
175,407
|
$
963,587
|
|
Contract services
revenue
|
-
|
-
|
50,000
|
32,000
|
|
|
|
|
|
|
|
|
|
Total
Revenues
|
20,532
|
181,092
|
225,407
|
995,587
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
Costs of sales and
contract services
|
77,555
|
119,989
|
227,563
|
700,953
|
|
Costs of
aquaculture
|
64,708
|
59,063
|
212,945
|
223,225
|
|
Research and
development
|
536,169
|
470,097
|
1,326,405
|
1,068,008
|
|
General and
administrative
|
635,716
|
720,421
|
2,314,143
|
2,595,176
|
|
|
|
|
|
|
|
|
|
Total
Expenses
|
1,314,148
|
1,369,570
|
4,081,056
|
4,587,362
|
|
|
|
|
|
|
|
Loss from
Operations
|
(1,293,616)
|
(1,188,478)
|
(3,855,649)
|
(3,591,775)
|
|
|
|
|
|
|
|
Other Income
(Loss):
|
|
|
|
|
|
Foreign exchange gain
(loss)
|
64,135
|
(8,188)
|
21,972
|
109,448
|
|
Loss in fair value of
warrant liability
|
-
|
-
|
-
|
(211,956)
|
|
Other
income
|
9,120
|
2,589
|
24,767
|
16,593
|
|
|
|
|
|
|
|
Income tax
expense
|
-
|
-
|
800
|
7,200
|
|
|
|
|
|
|
|
Net
Loss
|
$
(1,220,361)
|
$
(1,194,077)
|
$
(3,809,710)
|
$
(3,684,890)
|
|
|
|
|
|
|
|
Loss per common
share:
|
|
|
|
|
|
Basic and
diluted
|
$
(0.12)
|
$
(0.14)
|
$
(0.38)
|
$
(0.44)
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
Basic and
diluted
|
10,153,130
|
8,448,758
|
10,141,882
|
8,423,429
|
Condensed Interim
Consolidated Balance Sheets
|
(Unaudited - Prepared
by Management)
|
(Expressed in US
Dollars)
|
|
|
|
June
30,
|
September
30,
|
|
|
|
2017
|
2016
|
|
|
|
|
|
Assets:
|
|
|
|
Cash, cash
equivalents and short-term investments
|
$
7,645,010
|
$
11,405,698
|
|
Other current
assets
|
474,339
|
693,957
|
|
Noncurrent
assets
|
902,923
|
838,149
|
|
|
|
|
|
|
|
Total
Assets
|
$
9,022,272
|
$
12,937,804
|
|
|
|
|
|
Liabilities and
Shareholders' Equity:
|
|
|
|
Accounts payable and
accrued liabilities
|
$
425,342
|
$
623,644
|
|
Shareholders'
equity
|
8,596,930
|
12,314,160
|
|
|
|
|
|
|
|
Total Liabilities
and Shareholders' Equity
|
$
9,022,272
|
$
12,937,804
|
Condensed Interim
Consolidated Statements of Cash Flows
|
(Unaudited - Prepared
by Management)
|
(Expressed in US
Dollars)
|
|
|
|
|
|
|
|
|
Nine Months
Ended
|
|
|
|
June
30,
|
June 30,
|
|
|
|
2017
|
2016
|
|
|
|
|
|
Cash Flows Used In
Operating Activities:
|
|
|
|
Net loss
|
$
(3,809,710)
|
$
(3,684,890)
|
|
Items not affecting
cash:
|
|
|
|
|
Depreciation and
amortization
|
135,515
|
106,712
|
|
|
Share-based
compensation
|
92,480
|
209,781
|
|
|
Foreign exchange
loss
|
(21,972)
|
(109,448)
|
|
|
Loss in fair value of
warrant liability
|
-
|
211,956
|
|
Changes in working
capital items
|
21,153
|
(48,073)
|
|
|
|
|
|
Net cash used in
operating activities
|
(3,582,534)
|
(3,313,962)
|
|
|
|
|
|
Cash Flows From
Investing Activities:
|
|
|
|
Acquisition of
property, plant and equipment
|
(200,365)
|
(294,858)
|
|
Purchase of
short-term investments
|
(3,008,853)
|
(6,005,737)
|
|
Proceeds on sales and
maturities of short-term investments
|
3,000,000
|
9,021,827
|
|
Contribution to joint
venture
|
-
|
(66,695)
|
|
|
|
|
|
Net cash provided
by (used in) investing activities
|
(209,218)
|
2,654,537
|
|
|
|
|
|
Cash Flows From
Financing Activities:
|
|
|
|
Proceeds from
exercise of warrants and options
|
-
|
1,368,260
|
|
|
|
|
|
Net cash provided
by financing activities
|
-
|
1,368,260
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
22,211
|
122,865
|
|
|
|
|
|
Net change in cash
and cash equivalents
|
(3,769,541)
|
831,700
|
|
|
|
|
|
Cash and cash
equivalents - beginning of period
|
7,416,904
|
3,955,503
|
|
|
|
|
|
Cash and cash
equivalents - end of period
|
$
3,647,363
|
$
4,787,203
|
View original
content:http://www.prnewswire.com/news-releases/stellar-biotechnologies-reports-third-quarter-2017-financial-results-300501541.html
SOURCE Stellar Biotechnologies, Inc.