TORONTO, ONTARIO -- (Marketwire) -- 06/09/11 -- BioExx Specialty Proteins Ltd. (TSX: BXI) announced today its financial results for the three month period ended March 31, 2011. Complete financial statements and Management's Discussion and Analysis have been filed for public review at www.sedar.com and will be posted on the Company's website at www.bioexx.com.
During the quarter, the Company generated $1,249,601 of revenue from canola oil and canola meal sales at its Saskatoon plant, versus revenue of $1,695,668 in Q1 2010. This revenue was based on approximately 2,700 Mt seed processed in the quarter, as compared to approximately 4,642 Mt in the comparable quarter. Although canola seed costs continued to trend higher during the quarter, oil and meal prices were also robust. Accordingly, with somewhat improved unit economics versus much of 2010 and in order to move towards a more regular operating mode in advance of protein ramp-up, the Company ran the crush plant at higher rates during Q1 2011 than it had during any quarter since the comparative period of Q1 2010.
Gross Profit (Loss)
Cost of Goods Sold for the quarter was $2,205,971, compared to $2,530,042 for Q1 2010. The decrease results primarily from the lower processing volumes, although this decrease is mitigated by much higher seed costs in Q1 2011, at an average of $542 per Mt versus $399 per Mt in Q1 2010. As a result, Gross Loss for the quarter was $956,370, compared with $834,374 for the comparable period. As the Company has discussed in prior quarters, the operation of a very small 40,000 metric ton crush-only plant is economically challenging, and therefore until results reflect the inclusion of commercial protein production and sales, plant operations are best viewed not on a stand-alone basis but rather as a stepping stone towards protein production.
The Corporation incurred other expenses during the quarter of $2,907,397, compared to $3,256,055 in the comparable prior year period. The primary components of this reduction on a quarter-over-quarter basis were:
Other general and administrative expenses were comparable to the Q1 2010 period, at $906,755 versus $891,490.
As a non-cash item, share-based compensation was lower than the comparable prior year period, at $1,096,850 versus $1,379,686, driven primarily by a lower number of stock option grants in Q1 2011 versus Q1 2010.
The Company's migration towards commercial operations and its focus on the introduction of commercial protein production in Saskatoon reflects itself in significantly reduced Research and development spending versus Q1 2010, at $138,167 versus $888,541.
As the Company moved into the later stages of protein start-up and closer to commercial protein operations during Q1 2011, it continued to incur Plant commissioning and start-up expenses, in the amount of $606,915, versus Nil in Q1 2010 as the Saskatoon plant was not in the protein start-up phase at that time.
Sales and marketing expenses were higher in Q1 2011 versus Q1 2010, at $101,218 versus $53,640, reflective of the Company's commercial protein market engagement efforts in Q1 2011.
The Net Loss for the quarter was $3,863,767, compared to $4,090,429 for the comparable quarter. This reduction in net loss is the cumulative result of the various items discussed above. On a per share basis then, the Net Loss is $0.02 for the quarter, versus $0.03 in the prior quarter.
Working Capital and Liquidity
As at March 31, 2011, current assets were $13,160,289, including cash and restricted cash and investment of $8,795,009. Against current liabilities of $4,559,459, this results in net working capital of $8,600,830. This compares to current assets of $20,311,796 and net working capital of $14,147,997 as at December 31, 2010.
As discussed in Note 26(f) and 26(g) to the March 31, 2011 unaudited interim consolidated financial statements, subsequent to the end of the quarter, the $1,000,000 Contingency Reserve required under the Company's mortgage with Farm Credit Canada was released back to the Company, and the Company also received its $2,329,098 M&P Investment Tax Credit refund on account of its 2010 taxation year.
About BioExx Specialty Proteins Ltd.
Headquartered in Toronto, Canada, BioExx is a leading technology and industrial processing company focused on the extraction of oil and high-value proteins from oilseeds for the global food, beverage, nutrition, and industrial markets. BioExx uses patented and patent-pending technology that utilizes significantly lower temperatures than conventional methods for extracting the final quantities of oil necessary to enable its simplified and patent-pending methods for separating proteins from oilseeds. BioExx believes that these processes cumulatively have the potential to make a valuable contribution to global food and protein supply while maintaining an environmentally sustainable footprint. BioExx operates a commercial scale extraction facility in Saskatoon, Saskatchewan, is in development stages on it second plant in Minot, North Dakota and has a mission to construct additional and larger processing facilities on a global basis.
To find out more about BioExx Specialty Proteins Ltd. (TSX: BXI), please visit www.bioexx.com
The statements made in this press release include forward-looking statements that involve a number of risks and uncertainties. These statements relate to future events or future performance and reflect management's current expectations and assumptions. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements, such as the economy, generally, competition in its target markets, the demand for BioExx's products, the availability of funding, the efficacy of its technology, and the anticipated costs of BioExx's plant construction and operation. These forward-looking statements are made as of the date hereof and BioExx does not assume any obligation to update or revise them to reflect new events or circumstances. Actual events or results could differ materially from BioExx's expectations and projections.
BioExx Specialty Proteins Ltd.
Chief Financial Officer
(416) 588-4442 x111
Brisco Capital Partners