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8-K - 8-K - BioAmber Inc.bioa-8k_20150312.htm

Exhibit 99.1

BioAmber Reports Fourth Quarter and Full Year 2014 Financial Results

Minneapolis, MN, March 12, 2015. BioAmber Inc. (NYSE: BIOA), an industrial biotechnology company producing sustainable chemicals including bio-based succinic acid, today announced its financial results for the fourth quarter and year ended December 31, 2014.  Highlights included:

·

Substantial progress was made on construction of the 30,000 metric ton capacity commercial plant in Sarnia, and subsequent to the quarter the Company began commissioning the facility

·

The Company added a total of 21 new customers in 2014 and signed two significant take-or-pay agreements, including a 15-year commitment to purchase one third of Sarnia capacity annually

·

Net cash used in operating activities for the year ended December 31, 2014 was reduced by 22% to $21.5 million, compared to $27.5 million in the year ended December 31, 2013

“We are on the verge of completing our first commercial succinic acid plant within the original budget estimate, a significant achievement and milestone for our company,” said Jean-Francois Huc, BioAmber’s Chief Executive Officer. “We are ready for operations, with steam and electricity supply already hooked up to the plant, tested and live.   All plant operators have been hired and trained, and our key long-term supply agreements for sugar, steam and electricity signed.  In the coming weeks we will complete construction and in parallel start up the plant and qualify our product with customers, with the goal to be in commercial operation in Q3 2015,” he added.

Sarnia Highlights

·

Construction has progressed well and is expected to be completed in two months; the projected final cost of the plant remains within the original budget estimate of $125 million +/- 10%

·

Preparation is complete from an operational standpoint: all operators have been recruited and trained, the plant is connected to fully operational steam and power lines, and long term supply agreements for glucose, steam, electricity and maintenance services have been executed

·

Subsequent to the quarter end, the Company initiated commissioning of the Sarnia plant, a process that is anticipated to take approximately 5 months

Other Business Highlights

·

BioAmber added 5 new customers in the fourth quarter of 2014

·

The Company signed two take-or pay-agreements for Sarnia with Vinmar and PTTMCC Biochem that will ramp up in 2015 and represent 15,000 metric tons of annual sales in 2016 and 2017

·

New uses for BioAmber’s Bio-SATM were validated in the lubricants and paints/coatings markets, and unique flavoring performance for di-sodium succinate was demonstrated in food applications

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·

The Company ended as planned its toll manufacturing contract with ARD in Pomacle, France

Financial Highlights

·

Net cash used in operating activities was reduced by 22% year-over-year, with an average monthly cash burn of under $2.0 million per month in 2014

·

The Company closed on a three year, $25 million loan from Tennenbaum Capital Partners and used the proceeds to reimburse the outstanding loan with Hercules Technology Growth Capital

·

Cash on hand was $51.0 million as of December 31, 2014

Full Year 2014 Financial Results

Revenues for the year ended December 31, 2014 decreased to $1.5 million from $2.7 million for the same period in 2013.  Sales volume in 2014 was slightly higher than in 2013, but was offset by a decrease in the average sales price that resulted from customers seeking pricing more in line with the prices BioAmber has contractually committed to for future Sarnia supply.  The Company continues to manage sales in an effort to preserve its bio-succinic acid inventory levels in advance of the Sarnia plant start-up.

Gross loss in the year ended December 31, 2014 was $4.5 million, compared to a gross loss of $24,000 for the same period in 2013.  The increase was due to lower selling prices combined with an inventory reserve of $2.5 million and higher fixed production costs in 2014 than in 2013. These costs resulted from the transition away from the French demo plant to Sarnia production and pricing.

Research and development expenses for the year ended December 31, 2014 were $15.2 million, a decrease of $1.4 million from the same period in 2013. The decrease was primarily due the completion of the yeast development project with Cargill in 2013, greater in-house management of the patent portfolio, and a reduction of expenses related to our adipic acid platform.  These reductions were partially offset by an increase in payroll costs that resulted from a shift away from the use of external labs to in-house R&D resources.  

Sales and marketing expenses in the year ended December 31, 2014 were $4.5 million, versus $4.7 million in 2013. The decrease was primarily due to a decrease in third-party market study expenses and in incentive remuneration.

General and administrative expenses for the year ended December 31, 2014 increased to $10.7 million, from $9.8 million for the same period in 2013. The increase was primarily due to an increase in stock-based compensation due to stock option cancellations in the second quarter of 2014 and additional cost related to compliance and other costs associated with being a public company.

Foreign currency losses in the year ended December 31, 2014 were $151,000 as compared to a loss of $306,000 for the same period in 2013. The decrease stemmed from lower Canadian dollar cash balances in 2014 that were partly offset by a weaker Canadian versus US dollar during the period.

 

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During the year ended December 31, 2014, the Company incurred net financial charges of $11.7 million as compared to an income of $7.4 million in the same period in 2013.   The net financial charges in the year were mainly the result of $4.8 million of interest expense and end of term charge accretion on the loan from Hercules Technology Growth Capital, which was fully repaid in December 2014, compared to $1.8 million in 2013, and a $7.2 million of non-cash charge related to changes in the fair market value of the warrants issued in connection with the Company’s initial public offering, compared to a gain of $10.3 million recorded in 2013. The warrants are revalued at each reporting period resulting in a non-cash amount being recorded in the statement of operations for as long as the warrants remain outstanding.  

The Company recorded a net loss attributable to BioAmber Inc. shareholders of $46.4 million, or a loss of $2.32 per share, for the year ended December 31, 2014, as compared to a net loss of $33.2 million, or a loss of $2.13 per share, for the same period in 2013.

The Adjusted Net Loss Attributable to BioAmber Inc. Shareholders for the year ended December 31, 2014 was $34.7 million, or a loss of $1.74 per share, compared to an Adjusted Net Loss Attributable to BioAmber Inc. Shareholders of $33.6 million, or a loss of $2.16 per share, for the same period in 2013.  Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a non-GAAP financial metric that excludes, for the year ended December 31, 2014, the impact of the change in fair value of the warrants issued in connection with the IPO, the loss from the extinguishment of debt, a non-cash reserve taken on the recorded value of inventory, and the non-cash expense resulting from the cancellation of certain employee stock options.  For the year ended December 31, 2013, it excludes the impact of the change in fair value of the warrants issued in connection with the IPO, the intangibles and long lived assets impairment charges, the accelerated vesting of certain employee stock options from the IPO, and the non-cash gain from the extinguishment of debt.  Please refer to Annex A: “Non-GAAP Financial Information—Adjusted 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 12, 2015. 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: (416) 764-8688

Teleconference replays will be available through March 19, 2015:

Domestic: 1-888-390-0541

International: 416-764-8677

Passcode: 498791#

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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 an industrial biotechnology company producing sustainable chemicals. Its proprietary technology platform combines industrial biotechnology and chemical catalysis to convert renewable feedstock into sustainable chemicals for use in a wide variety of everyday products including plastics, resins, food additives and personal care products.  For more information visit www.bio-amber.com.

Forward-Looking Statements

This press release contains forward-looking statements, including statements related to the projected capital costs and scheduled completion of the Sarnia facility under construction, the commissioning and start up schedule, the beginning of our commercial operations and future sales projections for our Bio-SA facility including the take-or-pay agreements with Vinmar International and PTTMCC Biochem.   All statements other than statements of historical fact contained in this press release are forward-looking statements.  These statements often include words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” “seek,” “will,” “may” or similar expressions.  Forward-looking statements are subject to a number of risks and uncertainties, many of which involve factors or circumstances that are beyond BioAmber’s control.  BioAmber’s actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors.  Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee that the events and circumstances reflected in the forward-looking statements will be achieved or occur and the timing of events and circumstances and actual results could differ materially from those projected in the forward-looking statements. Accordingly, you should not place undue reliance on these forward-looking statements.  All such statements speak only as of the date made, and the Company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.  For additional disclosure regarding these and other risks faced by BioAmber, see disclosures contained in BioAmber's public filings with the SEC including, the "Risk Factors" section of BioAmber's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the Quarter ended September 30, 2014.

 

BioAmber Investor Contact

Mike Hartmann

Executive Vice President

514-844-8000 Ext. 120

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BioAmber Inc.

 

 

 

 

 

 

 

 

 

Consolidated Statements of Operations

 

 

 

 

 

 

(unaudited, in thousands, except for shares)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended  
December 31,

 

Year Ended  
December 31,

 

 

2014

 

2013

 

2014

 

2013

 

 

 

$

 

$

 

$

 

$

Product sales

 

 

              308

 

              439

 

          1,543

 

          2,665

Cost of goods sold

 

 

2,065

 

424

 

6,044

 

2,689

Gross loss

 

 

(1,757)

 

15

 

(4,501)

 

(24)

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

   Research and development

 

 

4,005

 

3,499

 

15,156

 

16,579

   Sales and marketing

 

 

679

 

909

 

4,482

 

4,730

   General and administrative

 

 

2,450

 

2,830

 

10,655

 

9,757

   Depreciation and amortization

 

 

72

 

53

 

260

 

1,165

   Impairment loss

 

 

 

 

 

8,619

   Foreign exchange (gain) loss

 

 

75

 

534

 

151

 

306

Operating Expenses                                                                                    

 

 

7,281

 

7,825

 

30,704

 

41,156

Operating loss

 

 

9,038

 

7,810

 

35,205

 

41,180

 

 

 

 

 

 

 

 

 

 

Amortization of deferred financing costs

 

 

74

 

(138)

 

292

 

240

Financial charges (income), net

 

 

(5,026)

 

278

 

11,737

 

(7,433)

Gain on debt extinguishment

 

 

              622

 

                 —

 

              171

 

            (314)

Equity participation in losses of equity method investments

 

 

                 —

 

                 —

 

                 —

 

 

15

Other expense (income),net

 

 

                  2

 

                 —

 

            (183)

 

                 —

Loss before income taxes

 

 

4,710

 

7,950

 

47,222

 

33,688

Income taxes

 

 

23

 

34

 

75

 

103

Net Loss

 

 

4,733

 

7,984

 

47,297

 

33,791

 

 

 

 

 

 

 

 

 

 

Net Loss attributable to:

 

 

 

 

 

 

 

 

 

        BioAmber Inc. shareholders

 

 

4,357

 

7,828

 

46,422

 

33,218

        Non-controlling interest

 

 

376

 

156

 

875

 

573

 

 

 

4,733

 

7,984

 

47,297

 

33,791

Net Loss per share attributable to

 

 

 

 

 

 

 

 

 

         BioAmber Inc.  shareholders - basic

 

 

$       0.20

 

$       0.42

 

$        2.32

 

$        2.13

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares

 

 

 

 

 

 

 

 

 

        outstanding- basic

 

 

21,829

 

18,469

 

20,016

 

15,591

 

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BioAmber Inc.

 

 

 

Consolidated Balance Sheet Information

 

 

 

(unaudited, in thousands)

 

 

 

 

As of        
December 31,
2014

 

As of            December 31, 2013

Assets

$

 

$

Current assets:

 

 

 

Cash and cash equivalents

51,043

 

83,728

Accounts receivable

477

 

755

Inventories

1,802

 

2,415

Prepaid expenses and other current assets

765

 

7,394

Deferred financing costs

3,005

 

671

  Total current assets

57,092

 

94,963

Property and equipment, net

88,665

 

13,554

Investment in equity method investment

35

 

710

Intangible assets including goodwill

4,957

 

4,852

Restricted Cash

647

 

Deferred financing costs

1,044

 

   Total assets

152,440

 

114,079

 

 

 

 

Liabilities

 

 

 

Current Liabilities:

 

 

 

Accounts payable and accrued liabilities

17,443

 

7,111

Income taxes payable

204

 

1,121

Deferred grants

2,275

 

3,061

Short-term portion of long term debt

2,978

 

6,520

  Total current liabilities

22,900

 

17,813

Long-term debt

34,653

 

23,210

Warrants financial liability

13,040

 

5,840

Other long term liabilities

128

 

82

      Total liabilities

70,721

 

46,945

Redeemable non-controlling interest

24,190

 

Shareholders’ Equity

57,529

 

67,134

Total Liabilities and Shareholders’ Equity

152,440

 

114,079

 


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BioAmber Inc.

 

 

 

 

 

 

 

Consolidated Statements of Cash Flows

 

 

 

 

 

 

 

(unaudited, in thousands $)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended  
December 31,

 

Year Ended  
December 31,

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

Operating Activities

 

 

 

 

 

 

 

Net Loss

(4,733)

 

(7,984)

 

(47,297)

 

(33,791)

Adjustments to reconcile net loss to cash:

 

 

 

 

 

 

 

   Stock-based compensation

1,384

 

1,269

 

6,949

 

6,732

   Depreciation and amortization

72

 

52

 

260

 

1,165

   Warrant revaluation

(7,199)

 

(560)

 

7,200

 

(10,308)

   Accretion of end of term charge on long-term      debt

(1,208)

 

241

 

(492)

 

493

   Amortization of deferred financing costs

74

 

(138)

 

292

 

240

   Impairment loss and write-off of fixed assets

 

 

 

8,619

   Change in working capital                                                    

(1,050)

 

2,294

 

10,640

 

(421)

Equity participation in losses of equity method
   investments

 

 

 

15

(Gain) loss on debt extinguishment

402

 

 

(50)

 

(314)

   Other

11

 

11

 

45

 

45

Net cash used in operating activities

(12,247)

 

(4,815)

 

(22,453)

 

(27,525)

 

 

 

 

 

 

 

 

Investing Activities

 

 

 

 

 

 

 

Acquisition of property and equipment

(25,540)

 

(8,181)

 

(85,014)

 

(12,788)

Change in restricted cash

 

 

(678)

 

Investment in equity method investments

 

 

675

 

Net cash used in investing activity

(25,540)

 

(8,181)

 

(85,017)

 

(12,788)

 

 

 

 

 

 

 

 

Financing Activities

 

 

 

 

 

 

 

Deferred financing costs

(586)

 

(71)

 

(1,077)

 

(793)

Issuance of long-term debt

28,508

 

1,102

 

33,741

 

26,692

Repayment of long-term debt

(22,154)

 

 

(25,000)

 

Government grants

6,032

 

656

 

10,132

 

1,141

Net proceeds from issuance of shares or units

29

 

140

 

60,858

 

73,023

Cancellation of shares

 

 

 

(140)

Net cash provided by financing activities

11,829

 

1,827

 

78,654

 

99,923

Foreign exchange impact on cash

(1,631)

 

(711)

 

(3,869)

 

(954)

Increase/(decrease) in cash

(28,556)

 

(11,880)

 

(32,685)

 

58,656

Cash, beginning of period

78,632

 

95,608

 

83,728

 

25,072

Cash, end of period

51,043

 

83,728

 

51,043

 

83,728

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ANNEX A: Non-GAAP Financial Information

Adjusted Net Loss Attributable to BioAmber Inc. Shareholders

The Adjusted Net Loss Attributable to BioAmber Inc. Shareholders for the year ended December 31, 2014 was $34.7 million, or a loss of $1.74 per share, compared to an Adjusted Net Loss Attributable to BioAmber Inc. Shareholders of $33.6 million, or a loss of $2.16 per share, for the same period in 2013.  Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a non-GAAP financial metric that excludes, for the year ended December 31, 2014, the impact of the change in fair value of the warrants issued in connection with the IPO, the loss from the extinguishment of debt, a non-cash reserve taken on the recorded value of inventory, and the non-cash expense resulting from the cancellation of certain employee stock options.  For the year ended December 31, 2013, it excludes the impact of the change in fair value of the warrants issued in connection with the IPO, the intangibles and long lived assets impairment charges, the accelerated vesting of certain employee stock options from the IPO, and the non-cash gain from the extinguishment of debt.  

 

BioAmber presents Adjusted Net Loss Attributable to BioAmber Inc. Shareholders as a supplemental measure of BioAmber’s performance. The above items are excluded from BioAmber’s Adjusted Net Loss Attributable to BioAmber Inc. Shareholders because these items are non-cash in nature, or because the amount and timing of these items are either unpredictable or not driven by current operating results and renders comparisons with prior periods and competitors less meaningful.  BioAmber believes Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is a useful measure for analysts and investors to evaluate BioAmber’s future ongoing performance as this measure allows for a more meaningful comparison of BioAmber’s projected cash earnings and performance with its historical results from prior periods and to the results of its competitors.  Adjusted Net Loss Attributable to BioAmber Inc. Shareholders corresponds more closely to the cash operating income generated from BioAmber’s business and allows investors to gain an understanding of the factors and trends affecting the ongoing cash earnings capabilities of BioAmber’s business.

 

Adjusted Net Loss Attributable to BioAmber Inc. Shareholders has certain limitations in that it does not take into account the impact of certain expenses to BioAmber’s consolidated statements of operations.  In evaluating Adjusted Net Loss Attributable to BioAmber Inc. Shareholders, you should be aware that in the future BioAmber may incur expenses similar to the adjustments in this presentation. BioAmber’s presentation of Adjusted Net Loss Attributable to BioAmber Inc. Shareholders should not be construed as an inference that BioAmber’s future results will be unaffected by unusual or non-recurring items. Adjusted Net Loss Attributable to BioAmber Inc. Shareholders is not a measurement of BioAmber’s financial performance under GAAP and should not be considered as an alternative to net income, operating income or any other performance measures derived in accordance with GAAP.


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BioAmber Inc.

 

 

 

 

 

 

 

Non-GAAP Financial Information

 

 

 

 

 

 

 

(unaudited, in thousands)

 

 

 

 

 

 

 

 

Three Months Ended  
December 31,

 

Year Ended  
December 31,

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

Net loss attributable to BioAmber Inc.  Shareholders

4,357

 

7,828

 

46,422

 

33,218

Deduct:

 

 

 

 

 

 

 

  Warrants Revaluation and issuance costs

(7,199)

 

(560)

 

7,200

 

(9,177)

  Intangible and long live asset impairment

 

 

 

8,369

  Accelerated vested options from IPO

 

 

 

724

  Loss (gain) on extinguishment of debt

622

 

 

171

 

(314)

  Inventory Reserve

556

 

 

2,454

 

  Additional charge for cancellation of stock options

 

 

1,853

 

Adjusted Net Loss attributable to

 

 

 

 

 

 

 

    BioAmber Inc. shareholders

10,378

 

8,388

 

34,744

 

33,616

 

 

 

 

 

 

 

 

Adjusted net loss per share attributable to

 

 

 

 

 

 

 

   BioAmber Inc. shareholders - basic

0.48

 

0.45

 

1.74

 

2.16

 

 

 

 

 

 

 

 

Weighted-average of common shares

 

 

 

 

 

 

 

   outstanding- basic

21,829

 

18,469

 

20,016

 

15,591

 

 

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