Bioniche Reports Fiscal 2011 Year-End Results
- Animal Health product sales revenues stable -
- overall revenues decrease due to fewer Human Health milestone revenues
compared to Fiscal 2010 -
(all figures are in Canadian dollars unless otherwise noted)
BELLEVILLE, ON, Sept. 14 /PRNewswire/ - Bioniche Life Sciences Inc. (TSX: BNC) (ASX: BNC), a research-based, technology-driven Canadian biopharmaceutical company, today announced financial results for its fiscal year ended June 30, 2011.
"The Company has worked diligently over the past few years to de-risk its business and, thus, create a more attractive investment opportunity," said Graeme McRae, Chairman, President & CEO. "This has been achieved through the signing of partnership deals, the presence of a solid base business generating revenue and positive earnings before research and development, the investment in intellectual property protection of core technologies, and the successful raising of capital resources."
The Company expects to be launching a series of new research and technology-driven products from its pipeline over the next 18 months. Announcements will be made as these products are launched in various global jurisdictions.
Fiscal 2011 Financial Results Highlights
Consolidated revenues related to Bioniche Animal Health product sales for the fiscal year were $27.4 million, as compared to $27 million in Fiscal 2010. This represents a stabilization of product revenues which had previously been reduced with the economic recession in some markets.
In addition to revenues from animal health product sales, the Company recorded licensing revenue of $5.5 million in Fiscal 2011, as compared to $16.2 million in Fiscal 2010, reflecting non-recurring milestone revenue earned under the Urocidin(TM) license, development and supply agreement with Endo Pharmaceuticals Inc. (Endo) and the amortization of the up-front payment by Endo upon the signing of this agreement. The total up-front payment received, C$22.3 million, will be recognized over 15 years, which is the term over which the Company maintains substantive contractual obligations (per Canadian Generally Accepted Accounting Principles - GAAP).
The Company generated Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) - before research and development expenses - of $6.0 million, as compared to $20.5 million in Fiscal 2010. The decrease can be attributed primarily to the lower milestone revenues in Fiscal 2011.
Fiscal year-end cash, cash equivalents and short-term investments amounted to $16.8 million, as compared to $11.1 million at June 30, 2010. At June 30, 2011, the Company's net working capital totaled $23.0 million, excluding the current portion of non-refundable deferred licensing revenue, as compared to net working capital of $16.5 million at June 30, 2010.
The value of the Company's Property, Plant and Equipment has increased to $27.8 million at June 30, 2011, compared to $16.6 million at June 30, 2010. This reflects the significant investment in the Animal Health and Food Safety Vaccine Manufacturing Centre at the Company's corporate headquarters in Belleville, Ontario. This facility was officially opened in April, 2011 and is undergoing commissioning and validation, a process which is expected to be completed in early calendar 2012, to be followed by production scale-up.
Administrative expenses grew in Fiscal 2011 to $10.5 million from $6.8 million at June 30, 2010. Administrative expenses reflect the accrual of approximately $2.0 million for a pension plan for the Company's President & CEO in recognition of his many years of service and longstanding leadership in the Company. The plan provides two months of salary continuance for every year of service, but has not required any cash outlay as the obligation is unfunded. Administrative expenses also include an increase in salaries and related benefits of $0.9 million, comprised of average salary increases of 3% and the creation of four new positions.
Research and development expenditures increased by $1.5 million in Fiscal 2011 to $19.8 million, as compared to $18.3 million in Fiscal 2010. R&D resources are focused on the advancement of certain development programs in Animal Health and Food Safety. There is continued investment in the staffing and infrastructure associated with the GMP production of the Company's Urocidin(TM) bladder cancer treatment that is in Phase III clinical testing. Endo has assumed financial responsibility for the external costs of clinical activities as they relate to Urocidin(TM), and the Company is refocusing its human clinical development activities for the underlying technology - Mycobacterial Cell Wall-DNA Complex (MCC) - on other indications.
The basic and fully-diluted net loss per share for Fiscal 2011 is ($0.17), as compared to a net loss per share of ($0.02) in Fiscal 2010. The decrease in revenues associated with reduced milestone payments from Endo contributed to the greater loss in Fiscal 2011. Total common shares outstanding at June 30, 2011 were 102,108,692, as compared to 72,890,247 at June 30, 2010.
More information on the Company's year-end financial results is provided in the Company's Fiscal 2011 Management's Discussion and Analysis dated September 14, 2011.
Fiscal 2011 Year-End Results Conference Call
The Company will discuss its year-end results during a:
Conference Call & Audio Web Cast
Wednesday, September 21, 2011
6:00 p.m. (Eastern)
To participate in the conference call from North America, call (888) 231-8191.
To participate in the conference call from Australia, call 1-800-287-011.
A listen-only audio web cast will be available at:
http://event.on24.com/r.htm?e=357400&s=1&k=196F8E1949C7EF06BF11AE4846538BA0
A replay of the conference call will be available until September 28, 2011 at midnight by calling 1-855-859-2056 (passcode: 10564534 followed by the number sign).
The web cast will be available for replay using the above link until September 20, 2012.
Timing of Q1, Fiscal 2012 Financial Reporting
Beginning in Q1, Fiscal 2012, the Company will be reporting its financial results according to International Financial Reporting Standards (IFRS). The conversion to IFRS accounting is a major project and the financial report will occur on or about December 8, 2011 as per Ontario Securities Commission regulations.
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 more than 200 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. The Company was named one of the Top 50 Small and Medium-Sized Employers in Canada for 2010, based on employee opinion. For more information, please visit 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.
Bioniche Life Sciences Inc.
Amalgamated under the laws of Ontario
CONSOLIDATED BALANCE SHEETS
As at June 30
(thousands of Canadian dollars) 2011 2010
$ $
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ASSETS
Current
Cash and cash equivalents 15,353 11,070
Short-term investment 1,493 -
Accounts receivable 6,460 8,601
Income taxes receivable 254 63
Future income tax assets 85 197
Inventories 8,604 6,668
Prepaid expenses and deposits 1,068 793
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33,317 27,392
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Long-term
Property, plant and equipment 27,759 16,584
Intangible assets 6,306 6,500
Goodwill 456 456
Long-term accounts receivable 1,756 1,156
Future income tax assets 43 51
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69,637 52,139
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities 8,520 9,716
Current portion of long-term debt and
obligations under capital leases 700 256
Current portion of repayable government assistance 1,049 960
Current portion of non-refundable deferred
licensing revenue 1,486 1,486
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11,755 12,418
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Long-term
Long-term debt 2,171 1,341
Obligations under capital leases 546 1,184
Repayable government assistance 13,395 6,965
Employee future benefit 2,012 -
Deferred government incentives - 2,382
Non-refundable deferred licensing revenue 17,867 19,353
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47,746 43,643
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Shareholders' equity
Share capital 125,630 96,677
Other paid-in capital 8,515 8,700
Deficit (112,254) (96,881)
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21,891 8,496
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69,637 52,139
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Commitments and contingencies
Bioniche Life Sciences Inc.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(thousands of Canadian dollars, except share amounts)
Preferred shares -
Common shares Series 1
# $ # $
------------------------------------------------------------
Balance,
June 30,
2009 71,681,147 86,895 167 161
Net loss
for the
year - - - -
Issued under
employee
share
ownership
plan 639,176 464 - -
Fair value
of stock
options
vested - - - -
Directors'
remun-
eration 278,495 103 - -
Warrants
exercised 211,429 165 - -
Options
exercised 80,000 90 - -
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Balance,
June 30,
2010 72,890,247 87,717 167 161
------------------------------------------------------------
Net loss
for the
year - - - -
Issued under
employee
share
ownership
plan 663,021 829 - -
Fair value
of stock
options
vested - - - -
Shares
issued 20,121,380 28,928 - -
Share
issuance
costs - (2,969) - -
Share
redemption (130,000) (156) - -
Conversion
of
Series II
preferred
shares 6,521,677 8,799 - -
Warrants
exercised 710,992 836 - -
Options
exercised 1,331,375 1,485 - -
Related
party
transaction - - - -
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Balance,
June 30,
2011 102,108,692 125,469 167 161
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Other
Preferred shares - paid-in
Series ll capital Deficit Total
# $ $ $ $
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Balance,
June 30,
2009 9,000,000 8,799 8,539 (95,291) 9,103
Net loss
for the
year - - - (1,590) (1,590)
Issued under
employee
share
ownership
plan - - - - 464
Fair value
of stock
options
vested - - 240 - 240
Directors'
remun-
eration - - - - 103
Warrants
exercised - - (61) - 104
Options
exercised - - (18) - 72
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Balance,
June 30,
2010 9,000,000 8,799 8,700 (96,881) 8,496
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Net loss
for the
year - - - (15,336) (15,336)
Issued under
employee
share
ownership
plan - - - - 829
Fair value
of stock
options
vested - - 477 - 477
Shares
issued - - - - 28,928
Share
issuance
costs - - - - (2,969)
Share
redemption - - - (17) (173)
Conversion
of
Series II
preferred
shares (9,000,000) (8,799) - - -
Warrants
exercised - - (313) - 523
Options
exercised - - (349) - 1,136
Related
party
transaction - - - (20) (20)
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Balance,
June 30,
2011 - - 8,515 (112,254) 21,891
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Bioniche Life Sciences Inc.
CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
Years ended June 30
(thousands of Canadian dollars, except share and per share amounts)
2011 2010
$ $
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REVENUES
Sales 27,366 26,993
Licensing 5,532 16,203
Research collaborations 3,146 1,820
Gain on disposal of intangible assets - 883
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36,044 45,899
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EXPENSES
Cost of sales (excluding amortization) 13,029 12,387
Administration 10,525 6,841
Marketing and selling 6,643 6,264
Financial expenses 1,015 726
Amortization of property, plant and equipment 1,058 1,080
Amortization and write-down of intangible assets 881 813
Foreign exchange loss 516 505
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33,667 28,616
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Income before research and development expenses
and other items 2,377 17,283
Research and development expenses, gross 19,782 18,264
Repayable government assistance - 3,884
Less: government assistance, net (1,954) (3,181)
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Loss before income taxes (15,451) (1,684)
Provision for income tax recovery (115) (94)
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Net loss and comprehensive loss for the year (15,336) (1,590)
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Basic and fully diluted net loss per share (0.17) (0.02)
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Weighted-average number of common shares
outstanding 88,896,923 72,239,959
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Bioniche Life Sciences Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended June 30
(thousands of Canadian dollars) 2011 2010
$ $
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OPERATING ACTIVITIES
Net loss for the year (15,336) (1,590)
Add (deduct) non cash items:
Amortization 1,939 1,841
Accreted interest on discounted receivables and
interest-free loans and amortization of
financial expenses 775 471
Write-down of intangible assets - 52
Unrealized foreign exchange loss (gain) 65 (47)
Deemed government assistance (61) (81)
Stock-based compensation expense 477 240
Accrued pension expense 2,012 -
Repayable government assistance - 3,884
Licensing revenue (1,486) (1,447)
Amortization of deferred government incentives (1,005) (1,689)
Future income taxes 97 (248)
Employee share ownership plan 836 528
Gain on sale of intangible assets - (883)
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(11,687) 1,031
Decrease in restricted cash - 1,227
Net change in non-cash working capital balances (1,361) (7,960)
Net change in non-refundable deferred licensing
revenue - 22,286
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Cash (used in) provided by operating activities (13,048) 16,584
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INVESTING ACTIVITIES
Government incentives received on account of
property, plant and equipment 1,496 1,098
Proceeds on settlement of long-term accounts
receivable 100 -
Proceeds on sale of intangible assets - 606
Purchase of short-term investments (1,493) -
Proceeds on disposal of property, plant and
equipment 70 21
Purchases of intangible assets (687) (521)
Purchases of property, plant and equipment (18,718) (7,789)
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Cash used in investing activities (19,232) (6,585)
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FINANCING ACTIVITIES
Proceeds from government assistance 9,342 1,706
Proceeds from long-term debt 500 -
Payment of financing fees - debt - (2,117)
Proceeds from shares issued 30,587 176
Payment of share issuance costs (2,969) -
Redemption of common shares (173) -
Proceeds from deferred government incentives 691 407
Repayment of government assistance (960) -
Repayment of revolving credit facility - (4,416)
Repayment of capital lease obligations (431) (292)
Repayment of long-term debt (24) (343)
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Cash provided by (used in) financing activities 36,563 (4,879)
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Net increase in cash and cash equivalents during
the year 4,283 5,120
Cash and cash equivalents, beginning of year 11,070 5,950
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Cash and cash equivalents, end of year 15,353 11,070
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SOURCE Bioniche Life Sciences Inc.
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