AquaBounty Technologies, Inc. Results for the year ended December 31, 2018
March 07 2019 - 5:00PM
AquaBounty Technologies, Inc. (NASDAQ: AQB) (“AquaBounty” or the
“Company”), a biotechnology company focused on enhancing
productivity in the aquaculture market and a majority-owned
subsidiary of Intrexon Corporation (NASDAQ: XON), announces the
Company’s financial results for the year ended December 31,
2018.
Results Highlights:
Operational
- Received approval from the U.S.
Food and Drug Administration (“FDA”) to raise AquAdvantage Salmon
at the Company’s Indiana farm;
- completed a second harvest of
AquAdvantage Salmon at our Panama farm and sold five tons as
fillets in Canada;
- commenced production operations at
the Indiana farm with traditional Atlantic salmon eggs while
waiting for approval from the FDA to import AquAdvantage Salmon
eggs; and
- hired Sylvia Wulf as the Company’s
new Chief Executive Officer, President, and Director effective
January 1, 2019.
Financial
- Completed a public offering of
common shares and warrants, raising net funds of
$10.6 million;
- completed an offering of common
shares through the conversion of outstanding warrants, raising net
funds of $4.3 million;
- the Company’s Canadian subsidiary
received a construction loan in the amount of CA$2.0 million
(US$1.6 million) from the Department of Economic Development
of the Province of Prince Edward Island; and
- net loss for the year increased to
$10.4 million (2017: $9.3 million) with the commencement
of production operations in Indiana.
Sylvia Wulf, Chief Executive Officer of
AquaBounty, stated: “This was a successful year in terms of our
operational achievements as we continue to take steps forward that
will ultimately lead to harvesting our fish on a regular schedule
from our two production farms and expanding our global
footprint.”
U.S. ProductionHaving completed
the first phase of upgrades to the Indiana farm, it was stocked
with conventional Atlantic salmon eggs from the Company’s hatchery
in Canada. The fish are growing well and are expected to be
ready for harvest in the summer of 2020. Regardless of
regulatory approval, commercialization of AquAdvantage Salmon in
the U.S. is presently blocked by an Import Alert requiring the
issuance of labelling guidance by the FDA. The FDA recently
confirmed in a statement to Congress that final labelling guidance
for AquAdvantage Salmon is in process. While the Company
understands, based on this statement, that guidance could be issued
within the next few weeks, regulatory decisions are never
certain. As a result of the FDA’s statements to Congress, the
Company is taking steps to prepare for the import of AquAdvantage
Salmon eggs.
Canada ProductionThe Company
expects to have AquAdvantage Salmon growing in its new Rollo Bay
farm facility on Prince Edward Island this quarter with harvest
projected to be in the summer of 2020, which will demonstrate the
superior growth rate, feed efficiency, and economic benefits of our
fish.
International
DevelopmentAquaBounty is also establishing operations
outside North America with projects currently in process in Brazil,
Argentina, Israel, and China. We believe that our experience
with growing salmon in recirculating aquaculture systems, combined
with our genetically superior fish, provides an unparalleled
opportunity to bring our nutritious, safe, and more sustainably
produced salmon to consumers.
Inquiries:
AquaBounty Technologies, Inc.Dave Conley,
Corporate Communications |
|
+1 613
294 3078 |
Forward-Looking Statements:
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934,
each as amended. All statements other than statements of historical
fact contained in this press release are forward-looking
statements, including statements regarding the potential for and
timing of: (1) issuance of labelling guidance and lifting of
the Import Alert, (2) FDA approval to import AquAdvantage
Salmon eggs into the United States, (3) raising AquAdvantage
Salmon at our farm in Indiana, (4) stocking our Rollo Bay
facility, (5) harvesting our fish from our production farms,
and (6) sale of our fish to consumers; the potential for
construction at our facilities on Prince Edward Island; projections
for harvest; demonstration of the benefits of AquAdvantage Salmon;
and expansion of the Company’s global footprint. Forward-looking
statements may be identified with words such as “will,” “may,”
“expect,” “plan,” “anticipate,” “upcoming,” “believe,” “estimate,”
or similar terminology, and the negative of these terms.
Forward-looking statements are not promises or guarantees of future
performance and are subject to a variety of risks and
uncertainties, many of which are beyond our control, which could
cause actual results to differ materially from those contemplated
in these forward-looking statements. Forward-looking statements
speak only as of the date hereof, and, except as required by law,
we undertake no obligation to update or revise these
forward-looking statements. For additional information regarding
these and other risks faced by us, please refer to our public
filings with the Securities and Exchange Commission (“SEC”),
available on the Investors section of our website at
www.aquabounty.com and on the SEC’s website at www.sec.gov.
AquaBounty Technologies,
Inc.Consolidated Balance Sheets
|
As of |
|
December 31, |
|
2018 |
|
2017 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash
equivalents |
$ |
2,990,196 |
|
|
$ |
492,861 |
|
Certificate of deposit |
12,361 |
|
|
13,422 |
|
Other
receivables |
115,982 |
|
|
183,926 |
|
Inventory |
76,109 |
|
|
172,363 |
|
Prepaid expenses and other current assets |
315,969 |
|
|
527,322 |
|
Total
current assets |
3,510,617 |
|
|
1,389,894 |
|
|
|
|
|
Property, plant and
equipment, net |
23,716,768 |
|
|
21,802,976 |
|
Definite-lived
intangible assets, net |
171,292 |
|
|
184,995 |
|
Indefinite-lived
intangible assets |
191,800 |
|
|
191,800 |
|
Other
assets |
80,583 |
|
|
162,093 |
|
Total
assets |
$ |
27,671,060 |
|
|
$ |
23,731,758 |
|
|
|
|
|
Liabilities and
stockholders’ equity |
|
|
|
Current
liabilities: |
|
|
|
Accounts
payable and accrued liabilities |
$ |
845,323 |
|
|
$ |
2,666,855 |
|
Current debt |
71,613 |
|
|
49,794 |
|
Total
current liabilities |
916,936 |
|
|
2,716,649 |
|
|
|
|
|
Long-term
debt |
3,519,821 |
|
|
3,034,420 |
|
Total liabilities |
4,436,757 |
|
|
5,751,069 |
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
Common
stock, $0.001 par value, 50,000,000 shares authorized; 15,098,837,
(2017: 8,895,094) shares outstanding |
15,099 |
|
|
8,895 |
|
Additional paid-in capital |
142,707,957 |
|
|
126,718,186 |
|
Accumulated other comprehensive loss |
(574,186 |
) |
|
(213,884 |
) |
Accumulated deficit |
(118,914,567 |
) |
|
(108,532,508 |
) |
Total
stockholders’ equity |
23,234,303 |
|
|
17,980,689 |
|
|
|
|
|
Total
liabilities and stockholders’ equity |
$ |
27,671,060 |
|
|
$ |
23,731,758 |
|
|
|
|
|
|
|
|
|
AquaBounty Technologies,
Inc.Consolidated Statements of Operations and
Comprehensive Loss
|
Years ended December 31, |
|
2018 |
|
2017 |
|
2016 |
Revenues |
|
|
|
|
|
Product Revenues |
$ |
84,518 |
|
|
$ |
53,278 |
|
|
$ |
— |
|
|
|
|
|
|
|
Costs and
expenses |
|
|
|
|
|
Product
costs |
78,155 |
|
|
50,777 |
|
|
— |
|
Sales and
marketing |
297,687 |
|
|
799,009 |
|
|
860,365 |
|
Research
and development |
3,458,564 |
|
|
3,371,767 |
|
|
3,429,400 |
|
General
and administrative |
6,615,908 |
|
|
5,063,824 |
|
|
3,775,289 |
|
Total costs and expenses |
10,450,314 |
|
|
9,285,377 |
|
|
8,065,054 |
|
|
|
|
|
|
|
Operating
loss |
(10,365,796 |
) |
|
(9,232,099 |
) |
|
(8,065,054 |
) |
|
|
|
|
|
|
Other income
(expense) |
|
|
|
|
|
Gain on
disposal of equipment |
13,233 |
|
|
941 |
|
|
2,861 |
|
Interest
expense |
(22,257 |
) |
|
(21,537 |
) |
|
(402,554 |
) |
Other income (expense), net |
(7,239 |
) |
|
(5,952 |
) |
|
(5,914 |
) |
Total other income (expense) |
(16,263 |
) |
|
(26,548 |
) |
|
(405,607 |
) |
|
|
|
|
|
|
Net loss |
$ |
(10,382,059 |
) |
|
$ |
(9,258,647 |
) |
|
$ |
(8,470,661 |
) |
|
|
|
|
|
|
Other
comprehensive income (loss): |
|
|
|
|
|
Foreign
currency translation gain (loss) |
(360,302 |
) |
|
72,388 |
|
|
(59,840 |
) |
Total other comprehensive income (loss) |
(360,302 |
) |
|
72,388 |
|
|
(59,840 |
) |
|
|
|
|
|
|
Comprehensive loss |
$ |
(10,742,361 |
) |
|
$ |
(9,186,259 |
) |
|
$ |
(8,530,501 |
) |
|
|
|
|
|
|
Earnings per
share |
|
|
|
|
|
Net loss |
(10,382,059 |
) |
|
(9,258,647 |
) |
|
(8,470,661 |
) |
Deemed dividend |
(1,822,873 |
) |
|
— |
|
|
— |
|
Net loss attributable
to common shareholders |
(12,204,932 |
) |
|
(9,258,647 |
) |
|
(8,470,661 |
) |
|
|
|
|
|
|
Basic and diluted net
loss per share attributable to common shareholders |
$ |
(0.94 |
) |
|
$ |
(1.06 |
) |
|
$ |
(1.60 |
) |
Weighted average number
of common shares -basic and diluted |
13,028,760 |
|
|
8,772,494 |
|
|
5,303,114 |
|
|
|
|
|
|
|
|
|
|
AquaBounty Technologies,
Inc.Consolidated Statements of Cash
Flow
|
Years ended December 31, |
|
2018 |
|
2017 |
|
2016 |
|
|
|
|
|
|
Operating
activities |
|
|
|
|
|
Net loss |
$ |
(10,382,059 |
) |
|
$ |
(9,258,647 |
) |
|
$ |
(8,470,661 |
) |
Adjustment to reconcile
net loss to net cash used in operating activities: |
|
|
|
|
|
Depreciation and amortization |
843,387 |
|
|
184,946 |
|
|
153,996 |
|
Share-based compensation |
263,396 |
|
|
122,134 |
|
|
218,294 |
|
Gain on
disposal of equipment |
(13,233 |
) |
|
(941 |
) |
|
(2,861 |
) |
Non-cash
interest and other expenses |
(1,364 |
) |
|
— |
|
|
395,833 |
|
Changes in operating
assets and liabilities: |
|
|
|
|
|
Other
receivables |
56,212 |
|
|
(11,440 |
) |
|
(121,640 |
) |
Inventory |
93,956 |
|
|
(169,991 |
) |
|
— |
|
Prepaid
expenses and other assets |
289,868 |
|
|
(592,602 |
) |
|
38,054 |
|
Accounts
payable and accrued liabilities |
(966,928 |
) |
|
625,763 |
|
|
340,092 |
|
Net cash used in operating activities |
(9,816,765 |
) |
|
(9,100,778 |
) |
|
(7,448,893 |
) |
|
|
|
|
|
|
Investing
activities |
|
|
|
|
|
Purchase of property,
plant and equipment |
(4,009,736 |
) |
|
(18,893,264 |
) |
|
(934,495 |
) |
Deposits on equipment
purchases |
(95,001 |
) |
|
(153,663 |
) |
|
(156,982 |
) |
Proceeds from sale of
equipment |
23,233 |
|
|
941 |
|
|
23,844 |
|
Payment of patent
costs |
— |
|
|
— |
|
|
(5,664 |
) |
Net cash used in investing activities |
(4,081,504 |
) |
|
(19,045,986 |
) |
|
(1,073,297 |
) |
|
|
|
|
|
|
Financing
activities |
|
|
|
|
|
Proceeds from issuance
of debt |
771,858 |
|
|
256,807 |
|
|
547,142 |
|
Repayment of term
debt |
(55,615 |
) |
|
(35,812 |
) |
|
(6,268 |
) |
Proceeds from the
issuance of convertible debt |
— |
|
|
— |
|
|
10,000,000 |
|
Proceeds from the
issuance of common stock and warrants, net |
10,616,046 |
|
|
24,989,257 |
|
|
— |
|
Proceeds from exercise
of stock options and warrants, net |
5,116,533 |
|
|
27,502 |
|
|
— |
|
Net cash provided by financing activities |
16,448,822 |
|
|
25,237,754 |
|
|
10,540,874 |
|
|
|
|
|
|
|
Effect of
exchange rate changes on cash and cash equivalents |
(53,218 |
) |
|
77,262 |
|
|
(7,496 |
) |
Net change in cash and
cash equivalents |
2,497,335 |
|
|
(2,831,748 |
) |
|
2,011,188 |
|
Cash and cash
equivalents at beginning of period |
492,861 |
|
|
3,324,609 |
|
|
1,313,421 |
|
Cash and cash equivalents at the end of
period |
$ |
2,990,196 |
|
|
$ |
492,861 |
|
|
$ |
3,324,609 |
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information and non-cash
transactions: |
|
|
|
|
|
Interest paid in
cash |
$ |
22,257 |
|
|
$ |
21,537 |
|
|
$ |
6,721 |
|
Conversion of
convertible debt and accrued interest to common stock |
$ |
— |
|
|
$ |
— |
|
|
$ |
10,395,833 |
|
Property and equipment
included in accounts payable and accrued liabilities |
$ |
193,378 |
|
|
$ |
1,036,240 |
|
|
$ |
50,132 |
|
Acquisition of
equipment under debt arrangement |
$ |
74,068 |
|
|
$ |
— |
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
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