NSCI Nanalysis Scientific Corp

CALGARY, AB, April 22, 2021 /CNW/ - Nanalysis Scientific Corp. (Nanalysis, TSXV: NSCI, OTCQX: NSCIF, FRA: 1N1), released today its fourth quarter and annual 2020 results.

OVERALL PERFORMANCE
For the three months ended December 31, 2020, the Company reported consolidated revenue of $2,680K, an increase of $557K or 26% from the comparative period in 2019. The Company continued to be impacted by COVID-19. Travel restrictions have delayed the completion of several key contracts, but despite these challenges overall revenue increased in the fourth quarter of 2020 compared to the fourth quarter of 2019. The increase in revenue is due to the inclusion of RS2D revenue, which was acquired in March 2020, as well as the first four shipments of Nanalysis' new flagship product: The 100MHz spectrometer. As at December 31, 2020 Nanalysis has $3.9 million of backlog of orders associated with the 100MHz product, of which $1.5 million has been prepaid by customers and is recorded in unearned revenue on the balance sheet.

Gross profit for three months ended December 31, 2020, was $1,750K (a margin of 65%) compared to gross profit of $1,693K (a margin of 79%) for the fourth quarter of 2019. The three months ended December 2019 had a cost recovery in cost of goods sold, resulting in increased margins for 2019.

The Company's comprehensive loss for the three months ended December 31, 2020, was $1,192K as compared to comprehensive income of $19K for the comparable period of 2019. The comprehensive loss for the three months ended December 31, 2020, was due to increased depreciation and amortization, increased stock-based compensation expense, increased research and development expenses, an RS2D earn-out payment, and increased operating expenses from RS2D, that were not in existence in the comparative period. These have been partially offset by increased finance income, a deferred tax recovery, increased other comprehensive income, and increased revenue.

For the twelve months ended December 31, 2020, the company reported consolidated revenue of $7,874K, a decrease of 6% from the $8,364K recognized for the twelve months ended December 31, 2019. The Company's comprehensive loss for the twelve months ended December 31, 2020 was $3,463K as compared to comprehensive loss of $1,660K in the comparable period of 2019. The decrease in revenue and increased comprehensive loss was due to the impact of COVID-19 which also caused delays in the development of the 100MHz product and the completion of several significant contracts in the year.

FINANCIAL POSITION
At December 31, 2020, Nanalysis had $3,049K (December 31, 2019 - $8,534K) of working capital, including $3,158K (December 31, 2019 - $6,619K) in cash. The Company has an undrawn line of credit of $2,000K and $785K of available borrowing on the Western Economic Diversification Canada interest free loan. Nanalysis's business has been affected by COVID-19 and as such is eligible for a subsidy of 75% of employees' wages in Canada. During the twelve months ended December 31, 2020, the Company claimed $1,449K and to date has received $1,280K from the Canadian emergency wage subsidy ("CEWS"). Subsequent to the end of 2020 the Company received:

• $1.0 million, under the Regional Recovery Relief Fund, the loan bears interest at three percent above the Bank of Canada rate and is repayable in 35 consecutive monthly installments of $28K commencing January 1, 2023.
• On December 18, 2020 Nanalysis executed an original equipment manufacturing contract ("OEM") with a European Corporation. Per the agreement an initial licensing fee of $876K was due within 15 days of signing and was received on January 11, 2021.
• On December 10, 2020 RS2D won a $1.2 million non-repayable grant to further leverage its proprietary Magnetic Resonance Imaging (MRI) technology for smart NextGen clinical MRI systems. Pursuant to the grant and subsequent to year end RS2D received an initial payment on March 29, 2021 of $629K.
• On April 9, 2020, RS2D received $383K for their 2019 Credit impot Recherche.

Nanalysis will continue to monitor revenues and seek government support for both Canadian and French operations where assistance is offered.    

OUTLOOK
Nanalysis's business has been affected by Covid-19 restrictions as our sales cycle has typically involved face-to-face customer meetings and marketing in person and at trade shows. While we have been exceedingly proud of developing the world's first 100 MHz (2.35 Tesla) spectrometer and the accompanying customer demand for this product, the Company has experienced a delayed timeline for completing QA/QC to meet manufacturing standards and procedures. Pandemic-related restrictions on travel have also slowed our development partnerships with Bosch, Sartec, and others. Despite these restrictions, we have been able to integrate RS2D's MR electronics and technologies into our existing products. The RS2D unit has performed well in its initial 10 months under Nanalysis's ownership. We are optimistic that, as Covid-19 restrictions ease in the latter half of 2021, Nanalysis is well-positioned to capitalize on our current initiatives and continue to drive expansion opportunities. As always, we will do so while striving to deliver value to our shareholders.

About Nanalysis Scientific Corp. (TSXV: NSCI, OTCQX: NSCIF, FRA:1N1)
Nanalysis trades on the TSX Venture Exchange (TSXV) in Canada with ticker symbol 'NSCI' ,Over the Counter (OTC) in the United States under the ticker symbol 'NSCIF', and on the Frankfurt Exchange (FRA) under the symbol '1N1'.

Nanalysis is an international business focused on capitalizing its proprietary technologies in nuclear magnetic resonance (NMR) that go into NMR spectrometers and magnetic resonance imaging (MRI). Nanalysis operates out of two subsidiaries, Nanalysis Corp. and RS2D S.A.S. (RS2D).

Nanalysis Corp. is an industry leader in developing and manufacturing compact NMR spectrometers for laboratory and industrial markets. Its cutting edge 60 and 100 MHz spectrometers require no liquid helium or other cryogens. Its spectrometers are used by chemical professionals spanning industries, including, but not limited to, oil and gas, chemical mining, pharmaceutical, and biotechnology.

Through its European subsidiary RS2D, the Company offers electronic boards and software used to drive MRI equipment in pre-clinical configurations and are being incorporated into next-gen MRI systems.

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Notice regarding Forward Looking Statements and Legal Disclaimer
This news release contains certain "forward-looking statements" within the meaning of such statements under applicable securities law. Forward-looking statements are frequently characterized by words such as "anticipates", "plan", "continue", "expect", "project", "intend", "believe", "anticipate", "estimate", "may", "will", "potential", "proposed", "positioned" and other similar words, or statements that certain events or conditions "may" or "will" occur. These statements are only predictions. Various assumptions were used in drawing the conclusions or making the projections contained in the forward-looking statements throughout this news release. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. The Company is under no obligation, and expressly disclaims any intention or obligation, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable law.

Neither TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this release.

SOURCE Nanalysis Scientific Corp.