ImmuCell Corporation (Nasdaq:ICCC), a growing
animal health company that develops, manufactures and markets
scientifically-proven products that improve the health and
productivity of dairy and beef cattle, today announced
unaudited financial results for the quarter ended September 30,
2017.
- During the three-month period ended September 30, 2017, total
product sales were just over $2 million compared to just under $2
million during the same quarter of 2016, an increase of 2%.
During the nine-month period ended September 30, 2017, total
product sales were just under $7.3 million compared to just over
$7.3 million during the same period of 2016, a decrease of less
than 1%.
- The year-to-year comparisons of product sales are impacted by
the 2016 shipments of an order backlog and sales of a product that
was discontinued during the first quarter of 2017. Excluding
the shipments of orders that were in backlog as of December 31,
2015 and sales of the discontinued product, sales during the first
nine months of 2017 would have increased by 8%, in comparison to
the same period during 2016.
- Sales of the First Defense® product line
increased (decreased) by 7%, 1% and (4%) during the three-month,
nine-month and twelve-month periods ended September 30, 2017,
respectively, in comparison to the same periods ended September 30,
2016.
- Net (loss) was ($339,000), or ($0.07) per share, for the third
quarter of 2017 in comparison to a net income of $35,000, or $0.01
per diluted share, during the third quarter of 2016.
- Net income was $27,000, or $0.01 per diluted share, during the
nine-month period ended September 30, 2017 in comparison to
$478,000, or $0.11 per diluted share, during the nine-month period
ended September 30, 2016.
Due to a sharp increase in sales (caused, in part, by the lack
of supply to the market of a competitive product during late 2014
and into the middle of 2015), the Company experienced a backlog of
orders from early 2015 and through the middle of 2016, before
doubling its production capacity. Since the third quarter of
2016, the Company has had sufficient available inventory and is
shipping in accordance with the current demand of its
distributors.
“Building on these third quarter results, we expect to report
positive sales growth during the fourth quarter of 2017, over both
the third quarter of 2017 and the fourth quarter of 2016,”
commented Michael F. Brigham, President and CEO. “We are
preparing to move forward into 2018 with an expanded product line
(subject to the anticipated USDA approval of First Defense®
Tri-Shield™) and with the impacts of both the order
backlog and of the discontinuation of the topical wipes product
line out of our prior year comparatives.”
Balance Sheet Data as of September 30,
2017:
- Cash, cash equivalents and short-term investments decreased to
$2.3 million at September 30, 2017 as the Company continued the
build-out of its new manufacturing facility, compared to $10.6
million at December 31, 2016.
- Net working capital decreased to $2.7 million at September 30,
2017 from $12.3 million at December 31, 2016.
- Stockholders’ equity increased to $21 million at September 30,
2017 from $19.7 million at December 31, 2016.
Product Development and Regulatory Update: On
November 13, 2017, the Company announced that it had achieved USDA
approval of First Defense®
Tri-Shield™, a new formulation that combines the
existing First Defense® bivalent claims (against
E. coli and coronavirus) with a guaranteed minimum level of
rotavirus antibody content in a gel tube delivery format. This
unique breadth of claims further differentiates the Company’s
product from competitive calf-level products on the market that
have claims against both coronavirus and rotavirus or just E. coli
or just coronavirus, but not all three. It also allows the
Company to better compete in the larger dam-level scours
preventative market space. The Company’s new marketing
campaign, ‘Beyond Vaccination™’, suggests that by
delivering immediate immunity directly to the calf via
First Defense® Tri-Shield™,
producers can avoid using such vaccines at dry-off and provide more
consistent protection to the calf at the calf-level.
Update on New Mastitis Product:A Certificate of
Occupancy was issued by the City of Portland, Maine on October 30,
2017 for the Company’s Nisin production facility. On November
8, 2017, the Company held a ‘ribbon-cutting’ ceremony to celebrate
the completion of the construction phase of this $21 million
project. This facility will be used by ImmuCell to produce
purified, pharmaceutical-grade Nisin Drug Substance at commercial
scale. Adherence to the Company’s anticipated timeline could lead
to potential approval by the end of 2019 with subsequent market
launch.
“Implementing Nisin production at commercial scale is the most
critical action in front of us on the path to regulatory approval
of our novel treatment for subclinical mastitis,” further commented
Mr. Brigham. “Completing the facility construction in
accordance with our timeline was an important milestone on the road
to commercialization of this product.”
Approximately $14.6 million was invested in the Nisin production
facility project through September 30, 2017. The Company
expects to pay for the remaining $6.2 million of budgeted
expenditures (that were unpaid as of September 30, 2017) with its
$2.3 million of cash on hand as of September 30, 2017 and its $4.3
million of available bank debt and cash flows from
operations.
Nisin is a bacteriocin that is not used in human medicines and
would not contribute to the ongoing concern that the widespread use
of antibiotics could encourage the growth of antibiotic-resistant
bacteria (“superbugs”).
Mastitis, which costs the dairy industry about $2 billion per
year, is currently treated with traditional antibiotic products,
and treatment is generally reserved for clinical infections when
the cow produces non-saleable milk. The “zero milk discard” product
feature approved for ImmuCell’s product would make earlier
treatment of sick cows economically feasible, while these cows are
still producing saleable milk. No other existing product can
provide this kind of value proposition.
Conference Call: Interested parties can access
the conference call scheduled by the Company to review these
results by dialing (844) 855-9502 (toll free) or (412) 317-5499
(international) at 4:30 PM ET today. A teleconference replay of the
call will be available for six days at (877) 344-7529 (toll free)
or (412) 317-0088 (international), confirmation
#10113568.
About ImmuCell: ImmuCell Corporation's
(Nasdaq:ICCC) purpose is to create scientifically-proven and
practical products that improve the health and productivity of
dairy and beef cattle. ImmuCell has developed products that
provide significant, immediate immunity to newborn dairy and beef
livestock. The Company is developing a novel treatment for
mastitis, the most significant cause of economic loss to the dairy
industry. Press releases and other information about the Company
are available at: (http://www.immucell.com).
Unaudited Condensed Statements of (Loss)
Income
|
|
|
|
|
For the Three-Month Periods
EndedSeptember 30, |
|
For the Nine-MonthPeriods
EndedSeptember 30, |
(In thousands, except
per share amounts) |
2017 |
|
2016 |
|
2017 |
|
2016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
$2,005 |
|
|
$1,968 |
|
|
$7,298 |
|
$7,330 |
Costs of goods
sold |
1,069 |
|
|
763 |
|
|
3,289 |
|
3,128 |
Gross
margin |
936 |
|
|
1,205 |
|
|
4,009 |
|
4,202 |
|
|
|
|
|
|
|
|
Sales, marketing and
administrative expenses |
832 |
|
|
846 |
|
|
2,527 |
|
2,440 |
Product development
expenses |
586 |
|
|
308 |
|
|
1,312 |
|
991 |
Operating
expenses |
1,418 |
|
|
1,154 |
|
|
3,839 |
|
3,431 |
|
|
|
|
|
|
|
|
NET OPERATING
(LOSS) INCOME |
(482 |
) |
|
51 |
|
|
170 |
|
771 |
|
|
|
|
|
|
|
|
Other expenses,
net |
49 |
|
|
27 |
|
|
115 |
|
81 |
|
|
|
|
|
|
|
|
(LOSS) INCOME
BEFORE INCOME TAXES |
(531 |
) |
|
24 |
|
|
55 |
|
690 |
|
|
|
|
|
|
|
|
Income tax (benefit)
expense |
(192 |
) |
|
(11 |
) |
|
28 |
|
212 |
|
|
|
|
|
|
|
|
NET (LOSS)
INCOME |
($339 |
) |
|
$35 |
|
|
$27 |
|
$478 |
|
|
|
|
|
|
|
|
Weighted average common
shares outstanding: |
|
|
|
|
|
|
|
Basic |
4,993 |
|
|
4,183 |
|
|
4,897 |
|
4,065 |
Diluted |
4,993 |
|
|
4,302 |
|
|
4,999 |
|
4,179 |
NET (LOSS)
INCOME PER SHARE: |
|
|
|
|
|
|
|
Basic |
($0.07 |
) |
|
$0.01 |
|
|
$0.01 |
|
$0.12 |
Diluted |
($0.07 |
) |
|
$0.01 |
|
|
$0.01 |
|
$0.11 |
|
|
|
|
|
|
|
|
Unaudited Selected Balance Sheet
Data
|
|
|
|
|
As of September 30, 2017 |
|
As of December 31,
2016 |
(In thousands) |
|
|
|
Cash, cash equivalents
and short-term investments |
$2,305 |
|
$10,624 |
Net working
capital |
|
2,691 |
|
|
12,289 |
Total assets |
|
30,290 |
|
|
24,697 |
Stockholders’
equity |
$20,954 |
|
$19,722 |
|
|
|
|
Contacts:
Michael F. Brigham, President and CEOImmuCell Corporation(207)
878-2770
Joe Diaz, Robert Blum and Joe DorameLytham Partners, LLC(602)
889-9700iccc@lythampartners.com
Safe Harbor Statement:
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. Such statements
include, but are not limited to, any statements relating to:
projections of future financial performance; the scope and timing
of ongoing and future product development work and
commercialization of our products; future costs of product
development efforts; the estimated prevalence rate of subclinical
mastitis; the expected efficacy of our new products; future market
share of and revenue generated by current products and products
still in development; future sources of financial support for our
product development, manufacturing and marketing efforts; the
future adequacy of our own manufacturing facilities or those of
third parties with which we have contractual relationships to meet
demand for our products on a timely basis; the future adequacy of
our working capital and the availability and cost of third party
financing; timing and future costs of a facility to produce the
Drug Substance (our active pharmaceutical ingredient, Nisin); the
timing and outcome of pending or anticipated applications for
regulatory approvals; future regulatory requirements relating to
our products; future expense ratios and margins; future compliance
with bank debt covenants; costs associated with sustaining
compliance with cGMP regulations in our current operations and
attaining such compliance for the facility to produce the Drug
Substance; factors that may affect the dairy and beef industries
and future demand for our products; our effectiveness in competing
against competitors within both our existing and our anticipated
product markets; the cost-effectiveness of additional sales and
marketing expenditures and resources; the accuracy of our
understanding of our distributors’ ordering patterns; anticipated
changes in our manufacturing capabilities and efficiencies;
anticipated competitive and market conditions; and any other
statements that are not historical facts. Forward-looking
statements can be identified by the use of words such as “expects”,
“may”, “anticipates”, “aims”, “intends”, “would”, “could”,
“should”, “will”, “plans”, “believes”, “estimates”, “targets”,
“projects”, “forecasts” and similar words and expressions. In
addition, there can be no assurance that future developments
affecting us will be those that we anticipate. Such statements
involve risks and uncertainties, including, but not limited to,
those risks and uncertainties relating to difficulties or delays in
development, testing, regulatory approval, production and marketing
of our products, competition within our anticipated product
markets, customer acceptance of our new and existing products,
product performance, alignment between our manufacturing resources
and product demand, the uncertainties associated with product
development and Drug Substance manufacturing, actual as compared to
expected or estimated costs of expanding our manufacturing
facilities, our potential reliance upon third parties for financial
support, products and services, changes in laws and regulations,
decision making by regulatory authorities, possible dilutive
impacts on existing stockholders from any equity financing
transactions in which we may engage, currency values and
fluctuations and other risks detailed from time to time in filings
we make with the Securities and Exchange Commission, including our
Quarterly Reports on Form 10-Q, our Annual Reports on Form 10-K and
our Current Reports on Form 8-K. Such statements are based on our
current expectations, but actual results may differ materially due
to various factors, including the risk factors discussed above.
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