Microbix Biosystems Inc.’ Virology Revenue Grows 24% In Third Quarter, Company Reports Fourth Consecutive Quarterly Profit
Management Provides Detailed Corporate Update
TORONTO, August 14, 2014 -- Microbix Biosystems Inc. (TSX: MBX), an innovator of biological products and technologies, today reported financial results for its third quarter and nine months ending June 30, 2014.
Third Quarter Financial Results
For the third quarter, Microbix reported total revenue of $2,039,935, compared to $1,906,652 for the same period in 2013, or an increase of 7%. There was no R&D contract revenue in the third quarter, compared to $256,745 in R&D contract revenue in the same period in 2013. Virology products revenue was $2,039,935 in the third quarter, compared to $1,649,907 for the same period in 2013, or an increase of 24%. The higher virology products revenue was primarily due to continued growth in customer demand including significant new business from an existing customer, as well as a favourable currency impact. R&D contract revenue typically fluctuates with customer priorities.
Total expenses for the third quarter were $856,059 compared to $947,252 for the same quarter in 2013, or a 10% reduction primarily due to various cost saving initiatives implemented in the past year. Operating income before income taxes for the second quarter was $294,561 compared to an operating loss of $22,687 for the same quarter last year.
Net cash flow decreased in the third quarter by $697,719, compared to a decrease of $71,931 for the same period in 2013. The decline was primarily due to the investment in property, plant and equipment, primarily to build the LumiSort™ demonstration instrument; as well as intangible assets, in defense of the VIRUSMAX® patents, totaling $1,467,802; partially offset by the conversion of warrants during the quarter of $545,511 and the improvement in operating cash flow of $212,923.
Nine-Month Financial Results
In the first nine months of fiscal 2014, Microbix reported total revenue of $6,040,917, compared to $5,105,693 for the same period in 2013, or an increase of 18%. Virology products revenue was $5,852,548 for nine months compared to $4,301,328 for the same period in 2013, or an increase of 36%. Strong customer demand and a favourable currency impact are the main drivers of this growth. R&D contract revenue for nine months was $140,772 compared to $804,365 for the same period in 2013.
Total expenses were $2,571,054 for nine months compared to $2,835,893 for the same period in 2013. After adjusting for the one-time gain on the disposal of assets of $145,266 in 2013, normalized total expenses were $2,981,159 for the first nine months of 2013. As a result, total expenses in the first nine months of 2014 decreased 14% compared to the normalized total expenses in 2013; primarily driven by cost saving initiatives implemented in the past year.
Operating income before income taxes for nine months was $778,587, compared to an operating loss of $403,755 for the same period last year, or an improvement in the bottom line of $1,182,342. Net cash flow increased in the nine months by $191,899 compared to a decrease of $175,667 for the same period in 2013, contributing to an improvement in the Company’s ending cash position of $399,186.
Vaughn C. Embro-Pantalony, President and Chief Executive Officer remarked, “I am very pleased with the strong improvement in our bottom line of $1.2 million after nine months. We have generated a profit in five of our last six fiscal quarters, including the last four consecutive quarters. Sustained profitability is very important, as we strive to achieve predictable operating cash flow to support our strategic spending priorities.”
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