Company to Hold Conference Call and Webcast
Today, Tuesday, August 13, 2019 at 4:30 PM EST.
Applied DNA Sciences, Inc. (NASDAQ: APDN) (“Applied DNA” or the
"Company"), announced consolidated financial results for the fiscal
2019 third quarter ended June 30, 2019. “Our fiscal third quarter
performance reflects our continuing abilities to monetize our
molecular taggant technology and our diagnostic and therapeutic
platforms while also realigning our cost structure and reorienting
our sales and business development efforts to support new
opportunities,” said Dr. James A. Hayward, chairman, president and
CEO of Applied DNA. “Revenues increased over 100% this quarter over
the same period last fiscal year and increased 164% quarter over
quarter, supplemented by the receipt of a $1 million cash payment
under the terms of our exclusive licensing agreement with TheraCann
International Benchmark Corporation (TheraCann).”
“After the close of the quarter we received a written delisting
notice from Nasdaq regarding our non-compliance with the
requirements for a $1.00 bid price and $35 million market value of
listed securities. We are diligently working to comply with all
applicable requirements for continued listing on Nasdaq and we
intend to submit a plan to that effect to the NASDAQ Hearings Panel
as part of the hearing process,” continued Dr. Hayward. “As part of
our plan, we secured a non-binding term sheet from TheraCann for
the outstanding $4 million balance under our licensing agreement in
the form of $4 million in convertible preferred stock as well as an
incremental $1 million convertible note. We also raised $1.5
million through a convertible note offering, which increases our
current convertible notes outstanding to approximately $3.7
million. If any portion of these notes were to convert into common
stock, it would increase our equity as a further step towards
facilitating Nasdaq compliance. We are engaged in Nasdaq’s appeal
process, and I am pleased to report that we have secured a hearing
for September 19, 2019 that allows us additional time to execute on
the balance of our plan. However, we can not provide assurance that
we will be successful in our NASDAQ appeal.”
Concluded, Dr. Hayward, “As we projected last quarter, our
growth is coming from cannabis, textiles and biotherapeutics.
Looking ahead, we remain focused on growth supported by these
business verticals. TheraCann’s ETCH™ BioTrace solution powered by
our tagging platform is attracting the attention of large cannabis
players. We will soon launch our CertainT® brand into the
cotton apparel market. Initial product from our recently completed
tagging program for Egyptian cotton is being used to build demand
among brands and manufacturers. Our LineaRx subsidiary is
increasingly being viewed within the biotech industry as a cleaner,
higher-performing alternative to plasmid DNA production that is
converting to increased order-flow. We have a burgeoning pipeline
and growing scientific and intellectual property assets following
the recent acquisition by LineaRx of the assets and IP of Vitatex,
Inc. that further broaden our platform’s applicability in the
potentially high-reward cancer diagnostic and therapeutic spaces.
Just last week we submitted to the NIH our application for a
3-year, approximately $4 million SBIR Phase IIb grant to be matched
with funding being sought from commercial 3rd parties, that, if
granted, will fund the full commercialization of the Vitatex
platform for early detection of non-hematologic cancers.”
Fiscal Third Quarter 2019 Financial Results:
- Revenues increased 102% for the third quarter of fiscal 2019 to
$2.1 million, compared with $1.0 million reported in the second
quarter of fiscal 2018, and increased 164% from the $778 thousand
reported in the second fiscal quarter ended March 31, 2019. The
increase in revenues was due primarily to an increase in revenue
from a licensing agreement in the cannabis industry of $1
million.
- Total operating expenses decreased to $3.2 million for the
second fiscal quarter of 2019, compared with $3.6 million in the
prior fiscal year’s second quarter. This decrease is primarily
attributable to approximately a $409 thousand decrease in payroll,
due to a realignment of the sales force and reductions in overall
headcount. This decrease in payroll was offset by an increase in
legal and professional fees.
- Net loss for the quarter ended June 30, 2019 was $1.5 million,
or $0.04 per share, compared with a net loss of $2.9 million, or
$0.10 per share, for the quarter ended June 30, 2018 and a net loss
of $2.7 million, or $0.08 per share, for the quarter ended March
31, 2018.
- Excluding non-cash expenses, Adjusted EBITDA was negative $1.2
million and a negative $2.5 million for the quarters ended June 30,
2019 and 2018, respectively. See below for information regarding
non-GAAP measures.
Nine-Month Financial Highlights:
- Revenues for the first nine months of fiscal 2019 totaled $3.7
million, an increase of 37% from $2.7 million from the same period
in the prior fiscal year. The increase in revenues was due to an
increase in service revenues of $1.4 million, or 92%, offset by a
decrease in product revenues of $344 thousand, or 28%. The increase
in service revenue was attributable to an increase in revenue of $1
million from the licensing agreement in the cannabis industry, as
well as increases of $140 thousand for a pre-commercial feasibility
project under the cooperation agreement with TheraCann entered into
during 2018, $51 thousand for the government contract award and
$143 thousand from pre-commercial pilots within the textile
industry.
- Effective October 1, 2018, the Company was required to adopt
Accounting Standards Update (ASU; the “Update”) No. 2014-09,
Revenue from Contracts with Customers (Topic 606), utilizing the
modified retrospective method. Had the Company not adopted the
Update, the Company would have recognized additional revenue of
approximately $851 thousand during the first nine months of fiscal
2019. This amount was primarily comprised of the recognition of
$766 thousand during the nine months periods ended June 30, 2019,
under a $1.15 million cotton order shipped in June 2018, with
extended payment terms. The total cumulative impact of the Update
that was recorded to opening retained earnings in fiscal 2019 was
approximately $494 thousand. See Cumulative Effect Adjustment and
the Impact on Current Period Financial Statements of Adopting Topic
606 attached.
- Operating expenses for the nine months ended June 30, 2019
increased by $486 thousand or 5% for the same period last fiscal
year. The increase is primarily attributable to an increase in
stock-based compensation and legal and professional fees, offset by
a decrease in payroll of $659 thousand.
- Net loss for the nine months ended June 30, 2019 was $7.4
million or $0.21 per share, compared with a net loss of $8.2
million or $0.28 per share for the nine months ended June 30,
2018.
- Excluding non-cash expenses and interest, Adjusted EBITDA for
the nine months ended June 30, 2019 was a negative $6.1 million as
compared to a negative $7.6 million for the same period in the
prior fiscal year. See below for information regarding non-GAAP
measures.
Fiscal Third Quarter 2019 Conference Call Information
The Company will hold a conference call and webcast to discuss
its fiscal third quarter-end 2019 results on Tuesday, August 13,
2019 at 4:30 PM ET. To participate on the conference call, please
follow the instructions below. While every attempt will be made to
answer investors’ questions on the Q&A portion of the call, due
to the large number of expected participants, not all questions may
be answered.
To Participate:
- Participant Toll Free:1-844-887-9402
- Participant Toll: 1-412-317-6798
- Please ask to be joined to the Applied DNA Sciences call
Live webcast:
https://services.choruscall.com/links/apdn190808.html
Replay (available 1 hour following the conclusion of the live
call through August 21, 2019):
- Participant Toll Free: 1-877-344-7529
- Participant Toll: 1-412-317-0088
- Participant Passcode: 10133063
- Webcast replay:
https://services.choruscall.com/links/apdn190808.html
For those investors unable to attend the live call, a copy of
management’s PowerPoint presentation will be available for review
under the ‘Events and Presentations’ section of the company’s
Investor Relations web site:
https://adnas.com/molecular-based-security/investors/
Information about Non-GAAP Financial Measures
As used herein, “GAAP” refers to accounting principles generally
accepted in the United States of America. To supplement our
condensed consolidated financial statements prepared and presented
in accordance with GAAP, this earnings release includes Adjusted
EBITDA, which is a non-GAAP financial measure as defined in Rule
101 of Regulation G promulgated by the Securities and Exchange
Commission. Generally, a non-GAAP financial measure is a numerical
measure of a company’s historical or future performance, financial
position, or cash flows that either excludes or includes amounts
that are not normally excluded or included in the most directly
comparable measure calculated and presented in accordance with
GAAP. The presentation of this non-GAAP financial information is
not intended to be considered in isolation or as a substitute for,
or superior to, the financial information presented in accordance
with GAAP. We use this non-GAAP financial measure for internal
financial and operational decision making purposes and as a means
to evaluate period-to-period comparisons of the performance and
results of operations of our core business. Our management believes
that these non-GAAP financial measures provide meaningful
supplemental information regarding the performance of our business
by excluding non-cash expenses that may not be indicative of our
recurring operating results. We believe this non-GAAP financial
measure is useful to investors as they allow for greater
transparency with respect to key metrics used by management in its
financial and operational decision making.
“EBITDA”- is defined as earnings (loss) before interest expense,
income tax expense and depreciation and amortization expense.
“Adjusted EBITDA”- is defined as EBITDA adjusted to exclude (i)
stock-based compensation and (ii) other non-cash expenses.
About Applied DNA Sciences
Applied DNA is a provider of molecular technologies that enable
supply chain security, anti-counterfeiting and anti-theft
technology, product genotyping and DNA mass production for
diagnostics and therapeutics.
We make life real and safe by providing innovative,
molecular-based technology solutions and services that can help
protect products, brands, entire supply chains, and intellectual
property of companies, governments and consumers from theft,
counterfeiting, fraud and diversion.
Visit adnas.com for more information. Follow us on Twitter and
LinkedIn. Join our mailing list.
Common stock listed on NASDAQ under the symbol APDN, and
warrants are listed under the symbol APDNW.
Forward-Looking Statements
The statements made by Applied DNA in this press release may be
“forward-looking” in nature within the meaning of the Private
Securities Litigation Act of 1995. Forward-looking statements
describe Applied DNA’s future plans, projections, strategies and
expectations, and are based on assumptions and involve a number of
risks and uncertainties, many of which are beyond the control of
Applied DNA. Actual results could differ materially from those
projected due to its history of net losses, limited financial
resources, limited market acceptance, the uncertainties inherent in
research and development, future clinical data and analysis,
including whether any of Applied DNA’s product candidates will
advance further in the preclinical research or clinical trial
process, including receiving clearance from the U.S. Food and Drug
Administration or equivalent foreign regulatory agencies to conduct
clinical trials and whether and when, if at all, they will receive
final approval from the U.S. FDA or equivalent foreign regulatory
agencies, shifting enforcement priorities of US federal laws
relating to cannabis, ability to maintain its NASDAQ listing in
light of delisting notices received and various other factors
detailed from time to time in Applied DNA’s SEC reports and
filings, including our Annual Report on Form 10-K filed on December
18, 2018, as amended, and our subsequent quarterly reports on Form
10-Q filed on February 7, 2019, May 9, 2019 and August 13, 2019,
and other reports we file with the SEC, which are available at
www.sec.gov. Applied DNA undertakes no obligation to update
publicly any forward-looking statements to reflect new information,
events or circumstances after the date hereof to reflect the
occurrence of unanticipated events, unless otherwise required by
law.
Financial Tables Follow
APPLIED DNA SCIENCES,
INC.
CONSOLIDATED BALANCE
SHEETS
June 30, 2019
September 30, 2018
ASSETS
(unaudited)
Current assets:
Cash and cash equivalents
$
507,146
$
1,659,564
Accounts receivable, net
243,557
1,485,938
Inventories
309,746
221,369
Prepaid expenses and other current
assets
544,509
635,174
Total current assets
1,604,958
4,002,045
Property and equipment, net
265,295
419,774
Other assets:
Deposits
62,375
62,325
Goodwill
285,386
285,386
Intangible assets, net
767,129
864,203
Total Assets
$
2,985,143
$
5,633,733
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable and accrued
liabilities
$
1,171,172
$
965,167
Deferred revenue
802,585
1,856,693
Total current liabilities
1,973,757
2,821,860
Long-term accrued liabilities
584,246
470,739
Secured convertible notes payable
2,215,668
1,586,631
Total liabilities
4,773,671
4,879,230
Commitments and contingencies
Stockholders’ (Deficit) Equity
Preferred stock, par value $0.001 per
share; 10,000,000 shares authorized; -0- shares issued and
outstanding as of June 30, 2019 and September 30, 2018
-
-
Series A Preferred stock, par value $0.001
per share; 10,000,000 shares authorized; -0- issued and outstanding
as of June 30, 2019 and September 30, 2018
-
-
Series B Preferred stock, par value $0.001
per share; 10,000,000 shares authorized; -0- issued and outstanding
as of June 30, 2019 and September 30, 2018
-
-
Common stock, par value $0.001 per share;
500,000,000 shares authorized; 38,327,057 and 30,112,057 shares
issued and outstanding as of June 30, 2019 and September 30, 2018,
respectively
38,327
30,112
Additional paid in capital
253,444,993
249,090,474
Accumulated deficit
(255,271,848
)
(248,366,083
)
Total stockholders’ (deficit) equity
(1,788,528
)
754,503
Total Liabilities and Stockholders’
(Deficit) Equity
$
2,985,143
$
5,633,733
APPLIED DNA SCIENCES,
INC.
CONSOLIDATED STATEMENTS OF
OPERATIONS
(unaudited)
Three Months Ended June 30,
Nine Months Ended June 30,
2019
2018
2019
2018
Revenues:
Product revenues
$
392,599
$
393,758
$
885,736
$
1,230,232
Service revenues
1,660,858
622,597
2,830,511
1,477,746
Total revenues
2,053,457
1,016,355
3,716,247
2,707,978
Cost of revenues
270,883
252,562
557,508
956,155
Operating expenses:
Selling, general and administrative
2,407,223
2,882,158
8,018,516
7,471,917
Research and development
719,668
625,006
2,080,610
2,034,886
Depreciation and amortization
87,315
122,999
320,039
425,927
Total operating expenses
3,214,206
3,630,163
10,419,165
9,932,730
LOSS FROM OPERATIONS
(1,431,632)
(2,866,370)
(7,260,426)
(8,180,907)
Other income (expense):
Interest (expense) income, net
(38,177)
-
(107,206)
-
Other expense
(8,102)
(21,353)
(31,356)
(36,738)
Loss before provision for income taxes
Provision for income taxes
—
—
—
—
NET LOSS
$
(1,477,911)
$
(2,887,723)
$
(7,398,988)
$
(8,217,645)
Net loss per share-basic and diluted
$
(0.04)
$
(0.10)
$
(0.21)
$
(0.28)
Weighted average shares outstanding-
Basic and diluted
38,113,391
30,112,057
34,970,862
29,290,555
APPLIED DNA SCIENCES,
INC.
CALCULATION AND RECONCILIATION
OF ADJUSTED EBITDA
(unaudited)
Three Months Ended June 30,
Nine Months Ended June 30,
2019
2018
2019
2018
Net Loss
$
(1,477,911
)
$
(2,887,723
)
$
(7,398,988
)
$
(8,217,645
)
Interest expense (income), net
38,177
-
107,206
-
Depreciation and amortization
87,315
122,999
320,039
425,927
Stock based compensation expense
(income)
154,304
238,738
911,642
184,806
Bad debt expense
-
3,434
(8,633
)
20,552
Total non-cash items
279,796
365,171
1,330,254
631,285
Consolidated Adjusted EBITDA (loss)
$
(1,198,115
)
$
(2,522,552
)
$
(6,068,734
)
$
(7,586,360
)
APPLIED DNA SCIENCES,
INC.
CUMULATIVE EFFECT ADJUSTMENT
AND THE IMPACT ON CURRENT PERIOD FINANCIAL STATEMENTS OF ADOPTING
TOPIC 606
(unaudited)
Three months ended June 30,
2019 (unaudited)
prior U.S. GAAP
Topic 606 impact
as reported
Statement of Operations Revenues Product
$
392,599
$
-
$
392,599
Service
1,681,065
(20,207
)
1,660,858
Total revenues
2,073,664
(20,207
)
2,053,457
Cost of revenues
270,883
-
270,883
Loss from operations
(1,411,425
)
(20,207
)
(1,431,632
)
Nine months ended June 30,
2019 (unaudited)
prior U.S. GAAP
Topic 606 impact
as reported
Statement of Operations Revenues Product
$
1,651,928
$
(766,192
)
$
885,736
Service
2,914,956
(84,445
)
2,830,511
Total revenues
4,566,884
(850,637
)
3,716,247
Cost of revenues
564,176
(6,668
)
557,508
Loss from operations
(6,416,455
)
(843,971
)
(7,260,426
)
Assets Prepaids and other current assets
$
551,178
$
(6,669
)
$
544,509
Liabilities and stockholder's equity Deferred Revenue
$
452,139
$
350,446
$
802,585
Accumulated Deficit
(254,921,402
)
(350,446
)
(255,271,848
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190813005560/en/
Investor contact: Sanjay M. Hurry, 212-838-3777, LHA
Investor Relations, shurry@lhai.com Media contact:
Susan Forman, Dian Griesel Int’l., 212-825-3210,
sforman@dgicomm.com Web: www.adnas.com
Twitter: @APDN
Applied DNA Sciences (NASDAQ:APDN)
Historical Stock Chart
From Mar 2024 to Apr 2024
Applied DNA Sciences (NASDAQ:APDN)
Historical Stock Chart
From Apr 2023 to Apr 2024