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Company Aqua Bounty Technologies, Inc.
TIDM ABTX
Headline

Final Results

Released 07:00 29-May-2012
Number 2683E07

RNS Number : 2683E
Aqua Bounty Technologies, Inc.
29 May 2012
 



29 May 2012

 

AquaBounty Technologies

("AquaBounty" or "the Company")

 

Preliminary Results for the year ended 31 December 2011

 and Notification of AGM

 

AquaBounty Technologies, Inc. (AIM: ABTX), a biotechnology company focused on enhancing productivity in the aquaculture market, announces the Company's preliminary financial results for the year ended 31 December 2011 and the date of its 2012 Annual General Meeting ("AGM").

 

Financial and operational summary

 

·     Net loss of US$2.7 million (2010: US$5.3 million net loss)

·     Net cash and marketable securities used during the year of US$4.6 million (2010: US$4.6 million)

·     Cash and marketable securities at 31 December 2011 amounted to US$1.6 million (2010: US$6.2 million)

·     Awarded a research grant of US$0.5 million from The National Institute of Food and Agriculture of the United States Department of Agriculture ("USDA")

 

Post period-end activities

 

·     Raised US$2.0 million via a placing of shares with existing shareholders

·     Implemented a reorganization to reduce operating costs by 30%, providing sufficient funds until early 2013

·     US Senate rejected an amendment demanding further study of AquAdvantage®Salmon ("AAS") as a pre-requisite for the U.S. Food and Drug Administration granting approval 

 

Ron Stotish, Chief Executive Officer of AquaBounty, said: "2011 was a frustrating year of waiting for some indication of FDA progress on our application, while continuing our R&D work and preparation for the commercialization phase.  We now await the publication of the FDA's Environmental Assessment, which the FDA commissioner has indicated will be very soon.  Following the publication of the Environmental Assessment, we expect to receive final approval of our New Animal Drug Application within the subsequent few months."

 

 

For further information, please contact:

 

AquaBounty Technologies                                 +1 781 899 7755

David Frank, Chief Financial Officer

 

Nomura Code Securities                                    +44 (0)20 7776 1200

Giles Balleny

 

Luther Pendragon                                              +44 (0)20 7618 9100

Harry Chathli, Claire Norbury



AGM Notification

 

AquaBounty will be holding its Annual General Meeting on 24 July 2012 at 08:30 a.m. (Eastern Daylight Time) at the Company's headquarters: Two Clock Tower Place, Suite 395, Maynard, Massachusetts USA.  Stockholders of record on 8 June 2012 shall be entitled to vote at the AGM.

 

 

 

Chairman's Statement

 

AquaBounty's primary activity in 2011 has been to continue to press forward with, and prepare for, the approval of its New Animal Drug Application ("NADA") for AquAdvantage® Salmon from the U.S. Food and Drug Administration ("FDA").  Whilst this process has taken considerably longer than expected due to the unique nature of the application, the Company remains confident that the FDA is advancing towards approval in the coming months.

 

FDA approval process

 

It has been twenty months since the FDA held a public meeting of its Veterinary Medicine Advisory Committee ("VMAC") in September 2010 to review its findings and conclusion that AAS is indistinguishable from other Atlantic salmon, is safe to eat and does not pose a threat to the environment under its conditions of use.  Since that meeting, the FDA has been considering its responsibilities under the U.S. National Environmental Policy Act and preparing its Environmental Assessment for AAS, which AquaBounty believes will be published in the coming weeks.  Once published, the Company expects final approval of AAS to be received within the subsequent four months.

 

Operations

 

During the year, management has continued its research and development programs, including work on a project entitled "Validation Of A Maternally Mediated Sterilization Platform For Reproductive Containment Of GE Fish With Initial Application To Tilapia," which received a three-year grant totalling US$494,000 from The National Institute of Food and Agriculture of the USDA.  The Company also progressed its research on the next generation of AAS and commenced a new market test in May 2012, which is being conducted at an inland commercial-scale unit.  This new batch of fish are thriving and performing in line with the Company's expectations, clearly demonstrating the benefits of this product.  The Company expects to harvest the fish in December 2012.

 

AquaBounty continues to develop relationships with authorities and producers in several countries that have appropriate production resources and are interested in testing the AquAdvantage® Salmon under their own conditions.  The Company has received a number of enquiries from prospective producers, within the US and elsewhere, that are enthusiastic about the economic prospects of growing the fish.

 

Operating expenses for the year amounted to US$5.4 million (2010: US$5.3 million).  Net loss for the year, however, was lower at US$2.7 million (2010: US$5.3 million) due to an adjustment to a long-term, royalty-based financing instrument.  Net cash and marketable securities used for the year was similar at US$4.6 million to the previous year (2010: US$4.6 million).

 

Post period-end activities

 

The delay in receiving approval to produce and sell AAS eggs has had a significant effect on the financial condition of the Company.  AquaBounty ended 2011 with US$1.6 million of cash, and it has become necessary to both raise additional funds as well as reduce operating costs in order to extend the Company's operating horizon.  It was considered in the best interests of all shareholders to carry out a limited fundraising of US$2.0 million by means of a placing to certain existing shareholders, which was completed on 22 March 2012.  In conjunction with this placement, the Company implemented a reorganization to reduce its operating costs by 30%, including the spin-off and sale of its research organization to Tethys Ocean, B.V., AquaBounty's largest individual shareholder. 

 

On 24 May 2012, the US Senate defeated an amendment that would have required the National Oceanic and Atmospheric Administration to conduct an additional study into the environmental and economic impact of AAS before the FDA could grant approval.  The amendment, which was filed by Senator Lisa Murkowski (R-Alaska) on 17 May 2012, received only 46 of the requisite 60 votes to be adopted.  The Company believes the rejection of this amendment demonstrates the Senate's support for the FDA and the understanding that Congress should not intervene in the federal agency's scientific process of approving applications. 

 

Outlook

 

The fundraising and the reorganization have provided the Company with sufficient funds to continue until early 2013.  With the FDA approval for AAS expected during 2012, AquaBounty is preparing for its commercialization phase.  It is recognised that this will require a substantial infusion of new capital to see the Company to cash-flow break-even and the Board expects to embark on a new fundraising and scale-up of operations by the end of this year.

 

 

R J Clothier

 

 


Consolidated balance sheets

 

 

As of 31 December


2011


2010

ASSETS





Current assets:





 

Cash and cash equivalents

$

1,630,980

$

2,577,189

 

Marketable securities


14,085


3,615,008

 

Other receivables


115,057


105,350

 

Prepaid expenses and other assets


195,759


236,232

Total current assets


1,955,881


6,533,779

Property, plant and equipment


1,246,781


1,381,552

Definite lived intangible assets


68,811


90,154

Indefinite lived intangible assets


191,800


191,800

Other assets


73,638


144,985

Total assets

$

3,536,911

$

8,342,270

LIABILITIES AND STOCKHOLDERS' EQUITY





Current liabilities:





 

Accounts payable and accrued liabilities

$

499,797

$

654,299

 

Current portion of long‑term debt


66,945


65,731

Total current liabilities


566,742


720,030

Deferred rent


-


13,683

Long‑term debt, net of current portion


1,392,656


3,647,365

Total liabilities


1,959,398


4,381,078

Commitments and contingencies





Stockholders' equity:





 

Common stock, $0.001 par value, 100,000,000 shares authorized; 68,780,968 (2010: 68,167,109) shares outstanding


68,781


68,167

 

Additional paid‑in capital


69,700,198


69,447,376

 

Accumulated other comprehensive loss


(650,804)


(723,284)

 

Accumulated deficit


(67,540,662)


(64,831,067)

Total stockholders' equity


1,577,513


3,961,192

Total liabilities and stockholders' equity

$

3,536,911

$

8,342,270

 

 



Consolidated statements of operations

 

 

Years ended 31 December


2011


2010

COSTS AND EXPENSES





Sales and marketing

$

673,306

$

758,775

Research and development


2,165,270


1,950,380

General and administrative


2,577,320


2,609,620

Total costs and expenses


5,415,896


5,318,775

OPERATING LOSS


(5,415,896)


(5,318,775)

OTHER INCOME (EXPENSE)





Gain on royalty based financing instrument


2,709,602


-

Interest expense


(3,301)


(1,935)

Total other income (expense)


2,706,301


(1,935)

NET LOSS

$

(2,709,595)

$

(5,320,710)

Basic and diluted net loss per share

$

(0.04)

$

(0.10)

Weighted average number of common shares - basic and diluted


68,570,857


54,857,110

 

 



Consolidated statements of changes in stockholders' equity

 

 





Accumulated




Common stock


Additional

other




issued and

Par

paid‑in

comprehensive

Accumulated



outstanding

value

capital

loss

deficit

Total

Balance at 31 December 2009

50,370,443

50,370

64,453,204

(591,517)

(59,510,357)

4,401,700

Net loss





(5,320,710)

(5,320,710)

Foreign currency translation




(129,219)


(129,219)

Unrealized losses on marketable securities




(2,548)


(2,548)

Total comprehensive loss






(5,452,477)

Issuance of common stock, net of expenses

17,666,666

17,667

4,837,384



4,855,051

Exercise of options for common stock

80,000

80

1,220



1,300

Share based compensation - common stock

50,000

50

15,995



16,045

Share based compensation - options



139,573



139,573

Balance at 31 December 2010

68,167,109

68,167

69,447,376

(723,284)

(64,831,067)

3,961,192

Net loss





(2,709,595)

(2,709,595)

Foreign currency translation




72,557


72,557

Unrealized losses on marketable securities




(77)


(77)

Total comprehensive loss






(2,637,115)

Exercise of options for common stock

387,273

387

3,486



3,873

Share based compensation - common stock

226,586

227

23,859



24,086

Share based compensation - options



225,477



225,477

Balance at 31 December 2011

68,780,968

$68,781

$69,700,198

$(650,804)

$(67,540,662)

$1,577,513

 

 



Consolidated statements of cash flows

 

 

Years ended 31 December


2011


2010

OPERATING ACTIVITIES





Net loss

$

(2,709,595)

$

(5,320,710)

Adjustment to reconcile net loss to net cash used in operating activities:





 

Depreciation and amortization


211,684


232,121

 

Share‑based compensation


249,563


155,618

 

Amortization of discount on marketable securities


69,948


57,429

 

Gain on royalty based financing instrument


(2,709,602)


-

 

Changes in operating assets and liabilities:





 

Other receivables


(9,518)


78,318

 

Prepaid expenses and other assets


111,001


32,286

 

Accounts payable and accrued liabilities


(164,228)


146,310

Net cash used in operating activities


(4,950,747)


(4,618,628)

INVESTING ACTIVITIES





Purchases of equipment


(68,615)


(107,178)

Purchases of marketable securities


(1,545,996)


(6,028,955)

Maturities of marketable securities


5,078,266


6,849,339

Payment of patent costs


(14,173)


(10,564)

Other


-


(10,651)

Net cash provided by investing activities


3,449,482


691,991

FINANCING ACTIVITIES





Repayment of long‑term debt


(66,479)


(61,484)

Proceeds from issuance of debt


613,723


534,586

Proceeds from issuance of common stock, net


-


4,855,051

Proceeds from exercise of stock options


3,873


1,300

Net cash provided by financing activities


551,117


5,329,453

Effect of exchange rate changes on cash and cash equivalents


3,939


(22,887)

Net (decrease) increase in cash and cash equivalents


(946,209)


1,379,929

Cash and cash equivalents at beginning of year


2,577,189


1,197,260

Cash and cash equivalents at end of year

$

1,630,980

$

2,577,189

SUPPLEMENTAL CASH FLOW INFORMATION





Interest paid in cash

$

7,115

$

8,841

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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