Dyadic International, Inc. Reports 2010 Fiscal Year Financial Results

JUPITER, Fla., March 10, 2011 /PRNewswire/ -- Dyadic International, Inc. (OTC Pink: DYAI), a global biotechnology company, today announced financial results for the year ended December 31, 2010. The financial information contained in this press release should be read in conjunction with the financial statements, footnotes and independent auditors’ report which have been posted on the OTC Markets website at www.otcmarkets.com and on Dyadic’s website at www.dyadic.com.

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Dyadic’s President and Chief Executive Officer, Mark Emalfarb, stated, “In 2010, Dyadic made substantial progress toward the continued growth of our licensing, research and development, and industrial enzyme businesses. We commenced discussions and negotiations with a broad spectrum of potential new partners and continue to work towards successfully concluding these potential collaborations. Our non-exclusive licensees, Codexis and Abengoa Bioenergy, continue to report positive results in using Dyadic’s C1 platform technology to reduce the costs involved in the commercialization of cellulosic ethanol and the production of cellulosic sugars for a variety of applications. Dyadic Netherlands has continued to attract funded research projects which provide a fertile testing ground of our technologies for various industry applications and the potential for those projects to evolve into broader partnerships. Our industrial enzyme business grew revenues by nine percent with improved margins as we continue to achieve greater distribution of new and existing products to our global customers. The recent launch of our Fibrezyme® G200 pulp and paper product was developed from an improved variant of our C1 technology which produces purer forms of proteins and enzymes at higher yields demonstrating once again the versatility and robust nature of our C1 technology platform. Lastly, we continued to strengthen our intellectual property portfolio with the recent grants of two additional U.S. patents.”

2010 Highlights

• Achieved annual revenues of approximately $8.4 million for the year ended December 31, 2010 which included an approximately nine percent increase in product related revenue with improved margins.
• Raised $4 million in a private placement of convertible subordinated secured promissory notes.
• Furthered the application of Dyadic’s C1 platform technology in the field of biopharmaceuticals by collaborating with EnGen Bio as Dyadic’s prospective exclusive licensee for additional collaborations in this field.
• Achieved a final resolution and dismissal of the stockholder class action lawsuit.
• Engaged The Abraham Group led by former U.S. Secretary of Energy, Spencer Abraham, as a strategic advisor.
• Strengthened the management team in the areas of strategic alliances and sales and marketing.
• Completed the re-sequencing and, with Scripps Florida, a division of the Scripps Research Institute, the re-annotation of the C1 genome.
• Received an additional U.S. patent pertaining to expression and subsequent screening of DNA libraries in filamentous fungal hosts which may help speed up the discovery of novel genes and development of their corresponding enzymes and proteins.

Financial Results

Total revenue for the year ended December 31, 2010 decreased to approximately $8.4 million as compared to approximately $21.4 million for the prior year.

Net product related revenue for the year ended December 31, 2010 increased nine percent to approximately $7.4 million as compared to approximately $6.8 million for the year ended December 31, 2009. Gross margins for the year ended December 31, 2010 continued to improve as a result of the restructuring of Dyadic’s industrial enzyme business to focus on higher margin products for growing segments of the industry such as animal feed, while streamlining and discontinuing lower margin products.

License fee revenue decreased to approximately $37,250 for the year ended December 31, 2010 as compared to $10.3 million for the prior year. This decrease was due largely to the fact that Dyadic recognized a $10 million upfront license fee from Codexis, Inc. in 2009 pursuant to a non-exclusive license agreement between Codexis and Dyadic and did not consummate any similar license agreements in 2010.

Research and development revenue decreased to approximately $1.0 million for the year ended December 31, 2010 as compared to approximately $4.3 million for the year ended December 31, 2009. This decrease was largely due to the recognition of approximately $3.3 million in research and development revenue in 2009 from Dyadic’s non-exclusive licensee, Abengoa Bioenergy.

Net loss for the year ended December 31, 2010 was approximately $5.5 million, or $(0.18) per basic and fully diluted share, as compared to net income of approximately $5.2 million, or $0.17 per basic and $0.16 per fully diluted share, for fiscal 2009.

At December 31, 2010, cash and cash equivalents totaled approximately $4.5 million as compared to approximately $8.4 million at December 31, 2009. This decrease was largely due to the net loss for the period and the resolution of the stockholder class action lawsuit which was partially offset by the private debt placement mentioned below.

At December 31, 2010, total debt was approximately $5.4 million as compared to approximately $1.4 million at December 31, 2009. This increase was due to Dyadic’s private placement in 2010 of $4.0 million of convertible subordinated debt.

About Dyadic

Dyadic International, Inc. is a global biotechnology company that uses its patented and proprietary technologies to conduct research, development and commercial activities for the discovery, development, manufacture and sale of enzyme and protein products for the bioenergy, industrial enzyme and biopharmaceutical industries. Please visit Dyadic’s website at www.dyadic.com.

Dyadic makes financial disclosures through the OTC Disclosure and News Service which offers free information on the OTC Markets website (www.otcmarkets.com) concerning companies traded on the OTC Markets. Investors can access and download Dyadic’s financial reports and other announcements that Dyadic makes through the OTC Markets website. Dyadic will also continue providing updates through regular press releases as appropriate.

Cautionary Statement for Forward-Looking Statements

Certain statements contained in this press release are forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause Dyadic’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Except as required by law, Dyadic expressly disclaims any intent or obligation to update any forward-looking statements.