MONTREAL - BioAmber Inc., a leader in renewable materials, announced operational and financial results for the three months ending June 30, 2016.
“BioAmber continues to meet ramp-up expectations at its Sarnia plant. We have made excellent progress in the plant’s reliability and performance, while continuing to increase production levels and drive down unit costs,” said Jean-Francois Huc, BioAmber’s Chief Executive Officer. “Second quarter sales were on track, generating a 73% increase in sales over Q1, while Q2 operations improved throughout the quarter, culminating in a June uptime rate of over 80%. The team is now entrenching its operating routines as our Sarnia facility moves towards full production levels," he added.
Sales of bio-succinic acid in the quarter were $2.5 million, an increase of 73% over the previous quarter and an increase of 637% compared to the same period last year.
The cost per ton of bio-succinic acid sold continued to decrease, with a 30% reduction relative to the previous quarter, and Sarnia variable costs were lowered to the company’s 2016 target.
Sarnia achieved an uptime rate of over 80% in the month of June 2016, having increased steadily during the second quarter. Less than 7% of total bio-succinic acid produced in Sarnia during the second quarter was off-spec, compared to 37% of bio-succinic acid production that was off-spec in the previous quarter.
Cash on hand was $5.5 million as of June 30, 2016, compared to cash on hand of $6.9 million on December 31, 2015. After the end of the quarter, the company closed on an additional $7.6 million from the previously disclosed BDC Capital loan.
Revenues for the quarter ended June 30, 2016, were $2.5 million. The increase in revenue was entirely attributed to volume growth, with no material change in the average selling price.
Gross loss for the quarter ended June 30, 2016 was $1.0 million, compared to $410,000 for the same period last year and $1.6 million for the previous quarter. The decrease in gross loss relative to the previous quarter was due to the greater volume of succinic acid produced and sold, improvements in operational efficiency, and a reduction in the quantity of off-spec product produced.
Research and development expenses for the quarter ended June 30, 2016 decreased to $1.5 million from $5.0 million for the same period last year. The higher costs recorded last year were the result of certain commissioning and start-up costs incurred in the quarter and recorded as research and development expenses. There was also a reduction in research costs in the second quarter of 2016 relative to the second quarter of 2015 due to the fact that the technology is now operating in a commercial facility.
Sales and marketing expenses for the quarter ended June 30, 2016 decreased to $584,000 from $1.1 million for the same period last year. This was driven by a decrease in stock-option compensation expenses, due to stock options granted in 2016 with a lower fair value and a decrease in salaries and benefits in the first quarter of 2016.
General and administrative expenses for the quarter ended June 30, 2016, were unchanged at $3.0 million compared to the same period last year.
For the quarter ended June 30, 2016, the company incurred net financial income of $11.3 million, compared to a charge of $3.8 million for the same period last year. There was a financial charge of $662,000 resulting from interest expense on long-term loans, which was offset by a non-cash gain of $11.9 million related to changes in the fair market value of the warrants issued in connection with the company’s initial public offering (IPO Warrants) and warrants issued in 2009 and 2011 (Legacy Warrants).
The company recorded a net income attributable to BioAmber Inc. shareholders of $4.8 million, or an income of $0.17 per share for the quarter ended June 30, 2016, compared to a net loss of $14.0 million, or a loss of $0.58 per share for the same period last year.