Bioniche Life Sciences Inc. Reports Fiscal Year-End Results
BELLEVILLE, Ontario, Sept. 28 /PRNewswire-FirstCall/ -- Bioniche Life Sciences Inc. , a research-based, technology-driven Canadian biopharmaceutical company, today announced financial results for its 2006 fiscal year ended June 30, 2006.
The President & CEO of Bioniche Life Sciences Inc., Graeme McRae, stated, "Bioniche had an eventful year. The U.S. Food and Drug Administration (FDA) approved our two Phase III trial protocols using Urocidin(TM) in the treatment of non-muscle invasive bladder cancer. In addition, we were granted fast track status for the refractory protocol, meaning that, when data from the refractory study becomes available, we can expect an expedited review of our Biologics Licensing Application for Urocidin." Urocidin is the first product to be developed from the Mycobacterial Cell Wall-DNA Complex (MCC) platform. This is a key technology for Bioniche, not only for bladder cancer, but for other human oncology indications which will be pursued once the Phase III clinical trials for bladder cancer are underway.
During Fiscal 2006, the Company sold certain non-core assets that were originally part of its Human Health division. The sale of Bioniche Pharma Group Limited and the product, Cystistat(R), were part of a strategic plan to monetize non-core assets and streamline the Company's focus. The cash generated from these transactions was used to finance core research activities as the Company starts its Phase III bladder cancer clinical trials and completes trials with its E. coli O157:H7 cattle vaccine for U.S. registration. The completion of these transactions contributed to a basic net income per share for Fiscal 2006 of $0.00 Cdn. compared to a net loss per share of ($0.43) Cdn. in Fiscal 2005.
Fiscal 2006 Financial Results Highlights
Consolidated revenues for the fiscal year remained flat when compared to Fiscal 2005.
The continued rise of the Canadian dollar in Fiscal 2006 had a negative impact on U.S. dollar and Euro dominated revenues of $1.3 million. This was offset by revenues from product additions, including the portfolio of embryo transfer products from the former AB Technology (acquired in 2004) and increases in market penetration of existing products, including additional registrations for the Company's top-selling follicle stimulating hormone, Folltropin(R)-V, in Europe.
Excluding currency fluctuation, Fiscal 2007 revenues are expected to improve in the animal health technology platforms, primarily in reproduction and embryo transfer products.
The overall gross profit margin continued remained constant in Fiscal 2006, at 57% as compared to 56% in Fiscal 2005.
Expenses totaled $22.1 million for the 12 months ending June 30, 2006, which compares to $17.2 million recorded in the same period last year. This increase of $4.9 million, or 28%, includes:
* $2.5 million incurred to restructure the Company's previous debt; * $1.4 million in additional amortization associated with the intangible and other assets and write-off of deferred financing fees; * $0.6 million for administration charges associated with certain severances, staff additions, and quality assurance; * $0.2 million for cash paid interest and non-cash imputed interest associated with the new debt; and * $0.2 million in other non-material charges.
Gross research and development (R&D) expenses remained stable in Fiscal 2006, reaching $12.9 million compared to $12.4 million in Fiscal 2005.
As a result of the Company's focus on the E. coli O157:H7 cattle vaccine and bladder cancer therapy, the Company completed several financing transactions to increase its liquidity and reorganize its capital structure. These transactions impacted the Fiscal 2006 income statement as follows:
* The sale of Bioniche Pharma Group, which closed during Q3, generated a $9.5 million gain, inclusive of the net year to date operations, recorded under "Income (Loss) from Discontinued Operations." * The sale of the Cystistat business, which closed during Q4, generated an $8.3 million gain recorded under "Discontinued Operations," inclusive of $0.7 million from net sales associated with the product.
Accordingly, the basic net loss per share for Fiscal 2006 was ($0.03) compared to a net loss per share of ($0.43) in Fiscal 2005.
"We are at an important point in our corporate development, and expect to achieve several significant milestones in the coming year," added Mr. McRae. "These events will drive our future commercial success and deliver significant value to our shareholders."
Conference Call/Audio Web Cast
Bioniche will host a conference call to discuss fiscal 2006 results on Monday, October 2, 2006 at 10:00 a.m. EDT. To participate in the teleconference, call toll-free 1-800-814-4860. A listen-only audio web cast will be available at http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=1589060 (English) or http://www.cnw.ca/fr/webcast/viewEvent.cgi?eventID=1589060 (French) or through the link on the home page of the Bioniche website (http://www.Bioniche.com).
A replay of the teleconference will be available until October 9, 2006 by 416-640-1917 or toll-free 1-877-289-8525 (passcode: 21204436#). The web cast will be available for replay using the above links until December 31, 2006.
About Bioniche Life Sciences Inc.
Bioniche Life Sciences Inc. is a research-based, technology-driven Canadian biopharmaceutical company focused on the discovery, development, manufacturing, and marketing of proprietary products for human and animal health markets worldwide. The fully-integrated company employs approximately 185 skilled personnel and has three operating divisions: Human Health, Animal Health, and Food Safety. The Company's primary goal is to develop proprietary cancer therapies supported by revenues from marketed products in human and animal health. For more information, please visit http://www.Bioniche.com.
Except for historical information, this news release may contain forward- looking statements that reflect the Company's current expectation regarding future events. These forward-looking statements involve risk and uncertainties, which may cause, but are not limited to, changing market conditions, the successful and timely completion of clinical studies, the establishment of corporate alliances, the impact of competitive products and pricing, new product development, uncertainties related to the regulatory approval process, and other risks detailed from time to time in the Company's ongoing quarterly and annual reporting.
For further information, please contact: Patrick Montpetit, CA Jennifer Shea Vice-President and Corporate Communications & Chief Financial Officer Investor Relations Manager Bioniche Life Sciences Inc. Bioniche Life Sciences Inc. Telephone: (514) 697-6636 Telephone: (613) 966-8058 Patrick.Montpetit@Bioniche.com Cell: (613) 391-2097 Jennifer.Shea@Bioniche.com Bioniche Life Sciences Inc. Amalgamated under the laws of Ontario CONSOLIDATED BALANCE SHEETS As at June 30 2006 2005 $ $ restated ASSETS Current Cash 4,093,293 3,527,408 Accounts receivable 5,644,956 6,671,846 Inventories 6,171,453 6,613,829 Prepaid expenses and deposits 804,470 778,273 Current assets -- discontinued operations - 12,799,641 16,714,172 30,390,997 Long-term Capital assets, net 10,138,797 10,422,860 Intangible assets, net 9,401,733 10,403,251 Goodwill 456,155 2,049,791 Deferred financing fees, net 1,258,236 838,055 Investment 3,298,279 - Other assets 100,000 576,000 Long-term assets -- discontinued operations - 28,868,602 41,367,372 83,549,556 LIABILITIES AND SHAREHOLDERS' EQUITY Current Revolving credit facility 3,162,097 - Accounts payable and accrued liabilities 5,054,593 7,015,841 Income and other taxes payable 494,881 584,101 Deferred government incentives 3,433,007 3,162,577 Current portion of senior and other long-term debt 1,220,840 3,634,986 Current liabilities -- discontinued operations - 17,276,398 13,365,418 31,673,903 Long-term Senior debt 3,697,806 2,458,946 Obligations under capital lease 953,957 994,457 Other long-term debt - 10,800,000 Deferred government incentives - 363,167 Long-term liabilities -- discontinued operations - 15,926,257 18,017,181 62,216,730 Shareholders' equity Share capital 72,686,901 70,382,951 Other paid-in capital 4,556,290 3,038,050 Deficit (53,869,621) (52,726,240) Cumulative translation adjustment (23,379) 638,065 23,350,191 21,332,826 41,367,372 83,549,556 Bioniche Life Sciences Inc. Amalgamated under the laws of Ontario CONSOLIDATED STATEMENTS OF LOSS Years ended June 30 2006 2005 $ $ restated REVENUE Sales 26,655,647 26,561,756 Cost of sales 11,331,332 11,676,366 Gross profit 15,324,315 14,885,390 EXPENSES Administration 5,378,949 5,014,387 Marketing and selling 6,247,569 6,301,904 Quality assurance 1,208,459 931,678 Interest on long-term debt 1,418,803 2,060,139 Other interest 287,729 (12,108) Imputed interest on convertible debentures 498,881 - Share ownership and bonus 571,230 391,159 Amortization of capital assets 1,217,731 1,084,013 Amortization and write-off of intangible and other assets 1,245,451 856,520 Amortization of deferred financing fees 1,357,835 411,332 Debt refinancing 2,493,920 - Foreign exchange loss 192,841 138,384 22,119,398 17,177,408 Loss before research and development and other items (6,795,083) (2,292,018) Research and development expenses, gross 12,915,955 12,374,432 Less government incentives, net (833,148) (990,479) Loss from continuing operations before income taxes (18,877,890) (13,675,971) Provision for income tax expense 112,094 75,232 Loss from continuing operations (18,989,984) (13,751,203) Income (loss) from discontinued operations 17,846,603 (1,851,769) Net loss for the year (1,143,381) (15,602,972) Basic and fully diluted net income (loss) per share Continuing operations (0.50) (0.38) Discontinued operations 0.47 (0.05) Basic and fully diluted net loss per share (0.03) (0.43) CONSOLIDATED STATEMENTS OF CASH FLOWS Years ended June 30 2006 2005 $ $ restated OPERATING ACTIVITIES Loss from continuing operations (18,989,984) (13,751,203) Add (deduct) non cash items: Amortization 3,821,017 2,351,865 Non-cash interest expense 498,881 - Foreign exchange gain (543,011) - Share, option, and warrant compensation 331,486 212,164 Share bonus - (102,357) Employee share ownership plan 544,872 597,715 Write down of deferred costs -- government incentives 576,000 - Debt refinancing 1,271,454 - Cash flow used in operations (12,489,285) (10,691,816) Net changes in non-cash working capital balances (1,552,485) 629,616 Cash used in operating activities (14,041,770) (10,062,200) INVESTING ACTIVITIES Payment relating to acquisition of net assets (123,120) (1,324,803) Government incentives received on account of capital assets 54,422 2,463 Proceeds on disposal of capital assets 11,888 - Investment in Bioniche Pharma Holdings Ltd. (1,740,146) Purchase of capital assets (1,000,017) (1,321,628) Cash used in investing activities (2,796,973) (2,643,968) FINANCING ACTIVITIES Proceeds from revolving credit facility 4,051,250 - Proceeds from term bridge loan 8,681,250 - Common shares issued, net 1,053,693 4,463 Proceeds from convertible term note 7,048,807 - Financing fees -- debt (1,333,986) (20,968) Proceeds on account of deferred government incentives 727,721 3,085 Repayment of revolving credit facility (741,285) - Repayment of term bridge loan (8,605,500) - Repayment of senior and other long-term debt (18,989,521) (769,074) Preferred shares issued, net - 11,731,716 Cash provided by (used in) financing activities (8,107,571) 10,949,222 Net decrease in cash from continuing operations (24,946,314) (1,756,946) Net increase in cash from discontinued operations 25,512,199 1,361,456 Net increase (decrease) in cash for the year 565,885 (395,490) Cash, beginning of year 3,527,408 3,922,898 Cash, end of year 4,093,293 3,527,408 Bioniche Life Sciences Inc. Amalgamated under the laws of Ontario CONSOLIDATED STATEMENTS OF DEFICIT Years ended June 30 2006 2005 $ $ Deficit, beginning of year (52,726,240) (37,123,268) Net loss for the year (1,143,381) (15,602,972) Deficit, end of year (53,869,621) (52,726,240)
Bioniche Life Sciences Inc.CONTACT: Patrick Montpetit, CA, Vice-President and Chief FinancialOfficer, +1-514-697-6636, Patrick.Montpetit@Bioniche.com, or Jennifer Shea,Corporate Communications & Investor Relations Manager, +1-613-966-8058,cell: +1-613-391-2097, Jennifer.Shea@Bioniche.com, both of Bioniche LifeSciences Inc.
Web site: http://www.bioniche.com/