MONTREAL, March 16, 2017 /PRNewswire/ - BioAmber Inc. (NYSE: BIOA), a leader in renewable materials, today announced operational and financial results for the three months and year ended December 31, 2016.
Operational Highlights
- 2016 sales of bio-succinic acid were $8.3 million, an increase of 281% over the previous year.
- Over 200 companies globally have now tested and qualified the bio-succinic acid produced at our Sarnia facility.
- Operations have shown greater consistency with both variable and fixed costs remaining on target, and off-specifications product below 5% in Q4.
Strategic Highlights
- On December 19th, 2016, we announced a non-binding letter of intent (LOI) with CJ CheilJedang Corporation (CJCJ) to establish a joint venture in China to produce up to 36,000 metric tons of bio-succinic acid and commercialize the output in Asia. CJCJ will incur all capital costs required to retrofit their fermentation facility and ramp up production.
- We successfully completed the first two phases of the four-phase process for a $360 million loan guarantee from the U.S. Department of Energy (U.S. DOE). This is an important milestone to secure financing for our proposed second facility.
"While our Sarnia facility has continued to showcase BioAmber's world leading disruptive bio-technology, the LOI with CJCJ validates its robust economics and provides an example of how BioAmber can further leverage its technology for the benefit of shareholders." stated Fabrice Orecchioni, BioAmber's President and Chief Operations Officer. "In addition to our operational success and following our recent equity raises, we have paid off our corporate debt in its entirety, and are looking to secure a Toronto Stock Exchange (TSX) listing before the end of April 2017", he added.
Q4 2016 Financial Highlights
- Our fourth quarter 2016 product sales of approximately $631,000 were below our previously disclosed fourth quarter expectations of $2.0 to $2.2 million. We expected that additional revenue of approximately $1.4 million would be recorded in the quarter but it had to be deferred until 2017 and was classified as a deferred revenue as of December 31, 2016.
- The entire cash proceeds from the sale have been received by BioAmber.
- We received gross proceeds of $7.0 million from our December 2016 equity issuance.
- In December 2016, we issued a $8.9 million special warrant that will be converted into common shares at the same price as the price per share of the equity issuance completed in December 2016. The proceeds are presently held in escrow and can be released to BioAmber upon the occurrence of a TSX listing which is expected before the end of April, 2017.
- Cash on hand was $16.2 million as of December 31, 2016. The balance does not include the proceeds of the $8.9 million special warrant currently held in escrow.
- Subsequent to our year-end, we received gross proceeds of $20.1 million from our January 27th equity issuance, and reimbursed our corporate debt in full on January 27, 2017.
Full-Year 2016 Financial Results
Revenues for the year ended December 31, 2016 were $8.3 million. The 281% increase relative to the previous year was driven by an increase in the quantity of bio-succinic acid sold from our Sarnia operations.
Cost of goods sold increased from $2.6 million for the year ended December 31, 2015 to $13.7 million for the year ended December 31, 2016, primarily explained by an increase in volume sold, as well as Sarnia facility ramp-up costs, including fixed costs and reprocessing costs for off-specification product that were allocated to the cost of goods sold.
General and administrative expenses were $9.5 million for the year ended December 31, 2016, down from $10.6 million incurred in the same period last year. This was driven by a decrease in incentive employee remuneration and in stock-based compensation expense, partially offset by an increase in salary and benefits expenses associated with the Sarnia facility transition from construction to production stage.
Research and development expenses were $7.2 million for the year ended December 31, 2016, down from $20.3 million for the same period last year. This significant decrease is explained by certain non-recurring Sarnia commissioning and start-up costs incurred in 2015 that were recorded as research and development expenses as well as by reduced expenses related to molecular engineering of the yeast, intellectual property and stock-based compensation.
Sales and marketing expenses were $2.9 million for the year ended December 31, 2016, down from $4.0 million for the same period last year. This was due to the expanded commercial role that Mitsui assumed in 2016, particularly in Asia, which allowed the Company to reduce the size of its global commercial team, resulting in a decrease in sales and marketing salaries, benefits and associated costs, including stock-based compensation and travel expenses.
Depreciation of property and equipment and amortization of intangible assets expense increased by $3.8 million to $4.8 million for the year ended December 31, 2016 as compared to $1.1 million for the year ended December 31, 2015.This increase is due to the depreciation of the Sarnia facility assets associated with the beginning of the Sarnia production in the fourth quarter of 2015.
The net financial charge for the year ended December 31, 2016 was income of $750,000 as compared to a net expense of $1.6 million for the year ended December 31, 2015. This expense decrease was mainly due to the mark-to-market adjustment change of $3.6 million on our IPO Warrants, 2011 Warrants and 2009 Warrants, partially offset by an increase in the interest expense, financing charges from the warrant issued in December 2016, and other financing charges in connection with the prepayment of our loan from Tennenbaum Capital Partners LLC.
The Company recorded a net loss attributable to BioAmber Inc. shareholders of $22.5 million, or a loss of $0.78 per share for the year ended December 31, 2016, compared to a net loss of $37.2 million, or a loss of $1.52 per share for the preceding year.
The Adjusted Net Loss Attributable to BioAmber Inc. Shareholders for the year ended December 31, 2016 was $30.8 million, or a loss of $1.07 per share, compared to an Adjusted Net Loss Attributable to BioAmber Inc. Shareholders of $38.0 million, or a loss of $1.55 per share for the year ended December 31, 2015. Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a non-GAAP financial metric that excludes (i) the impact of the change in fair value of the IPO and Legacy Warrants and (ii) the grant income from Sustainable Development Technology Canada (SDTC).
Please refer to Annex A: "Non-GAAP Financial InformationAdjusted Net Loss Attributable to BioAmber Inc. Shareholders" for more information regarding this non-GAAP financial metric.
Webcast and Conference Call Information
BioAmber will discuss these results on a live audio webcast, which will be available on the Internet to investors, members of the news media and the general public at 4:30 p.m. Eastern Time on March 16, 2017. To access the webcast of the conference call, go to the company's website, www.bio-amber.com. Audio of the teleconference is also available by dialing:
North American callers: +1 (888) 390-0546 International callers: +1 (416) 764-8688
Teleconference replays will be available through March 21, 2017: Domestic: +1-888-390-0541
International: +1 416-764-8677 Passcode: 087450#. A replay of the webcast will also be available approximately two hours after the conclusion of the live webcast on BioAmber's website, for a period of 30 days.
About BioAmber
BioAmber (NYSE: BIOA) is a renewable materials company. Its innovative technology platform combines biotechnology and catalysis to convert renewable feedstock into building block materials that are used in a wide variety of everyday products including plastics, paints, textiles, food additives and personal care products. For more information visit www.bio-amber.com
Forward-Looking Statements
This press release contains forward-looking statements, which are subject to substantial risks, uncertainties and assumptions, including, without limitation, statements related to (i) our production capacity and the ramping-up of our sales for our Sarnia Bio-SA facility, (ii) the timing of the construction of our next plants, as well as the financing of such plants, and (iii) our potential joint venture with CJCJ which remains subject to several conditions, including due diligence, the negotiation of key considerations and definitive agreements.
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