India Globalization Capital, Inc. (NYSE American: IGC) today
announced financial results for the quarter ended December 31,
2019, which is the third quarter of its 2020 fiscal year.
Revenue amounted to approximately $573 thousand and $1,285
thousand, for the three months ended December 31, 2019 and December
31, 2018 respectively. Revenue for the December 2019 quarter was
primarily derived from our Infrastructure Business on the execution
of a road building contract in Kerala, India, and the buying and
selling of infrastructure materials. In the three months ended
December 31, 2019, sales in the Plant and Cannabinoid Business,
consisting of the sale of cannabinoid products under the brands
Holi Hemp™ and Hyalolex™, in accordance with applicable law and
regulations, contributed $5 thousand in revenue. The lower revenue
in the Plant and Cannabinoid Business is due to management’s focus
on developing a wide array of products and the hemp growing, and
manufacturing facilities. The revenue for the nine months ended
December 31, 2019 and December 31, 2018 was about $4,043 thousand
and $3,574 thousand, respectively.
SG&A expense, inclusive of R&D expenses for the December
2019 quarter was approximately to $1,708 thousand compared to
approximately $973 thousand for the December 2018 quarter. The
majority of the increase in SG&A was due to one-time legal and
professional fees, including those incurred in connection with
defending shareholder lawsuits, and from employee-related expenses
due to increased employee head count as we added employees to the
manufacturing and marketing teams.
Net comprehensive loss for the December 2019 quarter was
approximately $1.65 million or $0.04 per share, compared to
approximately $0.91 million or $0.03 per share for the December
2018 quarter. Increased expenses from the plant and cannabinoid
business and legal as well as employee-related expenses, as noted
above, were the primary factors for the larger loss.
During the three months ended December 31, 2019, the Company
directed its resources broadly in the following areas:
Road Building: The Company is currently executing a road
building contract in Kerala, India valued at approximately $650
thousand that has been increased to approximately $1.2 million,
effective January 24, 2020.
Pharmaceutical Trial for Hyalolex™: The Company filed an
Investigative New Drug Application (INDA) with the FDA for a
double-blind, placebo-controlled, 100-person trial, for its
proprietary patent pending formulation based on IGC-AD1 that uses
ultra-low doses of THC with other natural compounds intended to
assist in the management of the care of patients suffering from
Alzheimer’s disease.
The Company established an approximately $500 thousand facility
in San Juan, Puerto Rico to house and conduct the trial on
IGC-AD1.
Hyalolex™ in Puerto Rico: The Company, as part of an
out-reach and marketing campaign, distributed samples of Hyalolex
to dispensaries in Puerto Rico. Hyalolex is available in about 40
dispensaries in Puerto Rico. A batch of Hyalolex was made in Puerto
Rico for distribution to dispensaries. We intend to collect data on
messaging, use, tolerance, among others. This data will be used to
position Hyalolex for a much wider state-side market, with a view
towards increased sales.
Products and Services Expansion: The Company progressed
its branding and product strategy with the development of several
brands aimed at various sectors of the market. The progress
includes filing trademark applications, intent to use applications,
securing URLs, creating product formulations, labeling, packaging,
product insurance, securing teams, focus groups, taste testing, and
organizing limited liability companies to mitigate risk, among
others. The categories the Company is working on include CBD
infused seltzer called Sunday Seltzer™, CBD infused creams and
topicals called Holief™, CBD infused life style products called
Herbo™, among others, that IGC intends to bring to market in the
future in compliance with applicable law and regulation. We expect
to deploy QR codes, on the containers, supported by our Hyperledger
based block chain system, that will allow customers to view, on a
website, product origination, product process including key
ingredient procurement and certifications, origination of hemp and
hemp extracts and their certifications, among others; in a bid to
assure customers of product compliance, safety, efficacy,
origination and process.
Hemp Crop: The Company grows, dries, and processes hemp.
A first test harvest, initiated in December, passed inspection by
the Arizona Department of Agriculture (AZDA) with the harvest
certified as legal under the USDA rules. Post drying, the harvest
will be transported for further processing to our facility in the
state of Washington in accordance with applicable law and
regulation.
Hemp Processing: The Company previously announced that it
contemplated a processing facility in Arizona. However, for various
business reasons, the Company withdrew from building the facility
in Arizona and instead has leased a GMP compliant building, in
Washington State, that was previously occupied by a supplement
manufacturer and has commenced buildout for extraction,
distillation and production of end user products. Some of our
equipment is sourced from China and the travel restrictions in
China could cause delays in completing some of the installation. We
expect that the facility will have three profit centers, a)
production of products such as lotions, creams, oils, among others,
to support our products and white labeling activity, b) extraction
of hemp into crude oil, intended to support farmers in the State of
Washington and Oregon, and c) distillation of crude oil into hemp
extracts. We intend that the facility, upon full completion and
inspection, will qualify as a Good Manufacturing Practice (GMP)
certified facility.
About IGC:
IGC currently has two lines of business: (i) infrastructure and
(ii) plant and cannabinoid-based products. The company is based in
Bethesda, Maryland, U.S.A. Its corporate website is www.igcinc.us.
Twitter @IGCIR.
Forward-looking Statements:
This press release contains forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934.
These forward-looking statements are based largely on IGC’s
expectations and are subject to a number of risks and
uncertainties, certain of which are beyond IGC’s control. Actual
results could differ materially from these forward-looking
statements as a result of, among other factors, competitive
conditions in the industries in which IGC operates, failure to
commercialize one or more of the products or technologies of IGC,
including any new products identified herein, failure to obtain an
R&D license or any other applicable license or regulatory
approval necessary for conducting our trial protocol, any changes
in federal, state, or local law applicable to our businesses and
the locations where we operate, weather and/or climate events which
impact the Company’s ability to harvest its hemp crop, failure to
reach agreement on specific terms to resolve the shareholder and
shareholder derivative suits currently pending against the Company
as described in the Company’s public filings, general economic and
political conditions that are less favorable than expected, the
Federal Food and Drug Administration’s (FDA) general position
regarding hemp-based and related products in particular, and other
factors, many of which are discussed in our SEC filings. The Risk
Factors identified in the Company’s annual report, filed on Form
10-K with the SEC on June 14, 2019, and in the Company’s quarterly
report, filed on Form 10-Q with the SEC on August 9, 2019, and on
November 5, 2019, and on February 10, 2020 are incorporated herein
by reference. In light of these risks and uncertainties, there can
be no assurance that the forward-looking information contained in
this release will in fact occur.
India Globalization Capital,
Inc.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except share
data)
(Unaudited)
December 31,
2019
(Unaudited)
($)
March 31,
2019
(Audited)
($)
ASSETS
Current assets:
Cash and cash equivalents
10,129
25,610
Short-term investment
5,063
-
Accounts receivable, net
155
84
Inventory
3,585
248
Deposits & advances
1,574
781
Total current assets
20,506
26,723
Intangible assets, net
247
184
Property, plant and equipment, net
8,687
5,886
Investments in unlisted securities
794
794
Claims and advances
868
878
Total non-current assets
10,596
7,742
Total assets
31,102
34,465
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable
599
319
Accrued and other liabilities
652
509
Short-term loan
50
50
Total current liabilities
1,301
878
Other liabilities
15
15
Total non-current liabilities
15
15
Total liabilities
1,316
893
Commitments and Contingencies – See
Note 11
Stockholders' equity:
Common stock and additional paid in
capital, $0.0001 par value: 150,000,000 shares authorized;
39,571,407 and 39,501,407 shares issued and outstanding as of
December 31, 2019 and March 31, 2019, respectively.
94,585
94,043
Accumulated other comprehensive loss
(2,586
)
(2,419
)
Accumulated deficit
(62,213
)
(58,052
)
Total stockholders' equity
29,786
33,572
Total liabilities and stockholders'
equity
31,102
34,465
See accompanying Notes to the Condensed
Consolidated Financial Statements in the Quarterly Report on Form
10-Q for the quarter ended December 31, 2019, as filed with the SEC
on February 10, 2020.
India Globalization Capital,
Inc.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS
(in thousands, except loss per
share)
(Unaudited)
Three months
ended December 31
Nine months
ended December 31
2019
2018
2019
2018
($)
($)
($)
($)
Revenue
573
1,285
4,043
3,574
Cost of revenue
(543)
(1,240)
(3,944)
(3,469)
Gross Profit
30
45
99
105
General and administrative expenses
(1,413)
(807)
(3,756)
(1,955)
Research and development expenses
(295)
(166)
(764)
(445)
Inventory write off
-
(650)
-
(650)
Operating loss
(1,678)
(1,578)
(4,421)
(2,945)
Other income, net
75
430
260
426
Loss before income taxes
(1,603)
(1,148)
(4,161)
(2,519)
Income tax expense
-
-
-
-
Net loss attributable to common
stockholders
(1,603)
(1,148)
(4,161)
(2,519)
Foreign currency translation
adjustments
(43)
239
(167)
(401)
Comprehensive loss
(1,646)
(909)
(4,328)
(2,920)
Loss per share attributable to common
stockholders:
Basic & Diluted
$
(0.04)
$
(0.03)
$
(0.11)
$
(0.07)
Weighted-average number of shares used in
computing loss per share amounts:
39,571
39,357
39,543
34,035
See accompanying Notes to the Condensed
Consolidated Financial Statements in the Quarterly Report on Form
10-Q for the quarter ended December 31, 2019, as filed with the SEC
on February 10, 2020.
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version on businesswire.com: https://www.businesswire.com/news/home/20200210005810/en/
Claudia Grimaldi 301-983-0998
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