|MBLX burnt through $6.4 million in cash during the third quarter. As of September 30, they had $94.6 million in cash. They expect to start shipping product during the second quarter of next year.|
Metabolix Reports Third Quarter 2008 Financial Results and Provides Business Update
Wednesday November 5, 4:01 pm ET
CAMBRIDGE, Mass.--(BUSINESS WIRE)--Metabolix, Inc. (NASDAQ: MBLX - News), a bioscience company focused on developing clean, sustainable solutions for plastics, chemicals and energy, today reported financial results for the three months ended September 30, 2008.
The Company reported a net loss of $9.7 million or $0.42 per share for the third quarter of 2008 as compared to a net loss of $8.3 million or $0.37 per share for the third quarter of 2007.
The Company’s net cash used for operating activities during the third quarter in 2008 was $6.4 million, which compares to net cash used of $0.9 million for the comparable quarter in 2007. The increase in cash used from operating activities is primarily attributable to the increase in net loss and the timing of support payments received from Archer Daniels Midland Company (ADM). Unrestricted cash and short-term investments at September 30, 2008 totaled $94.6 million.
“This quarter we made steady progress in the commercialization of MirelTM, as well as in our plant science programs,” said Richard Eno, President and CEO of Metabolix. “We continued to build overall demand for Mirel and are pleased to have two new customer agreements: with Ball Horticultural and with a Fortune 500 consumer products company.” Added Mr. Eno, “In plant science, our Australian collaborators, the Cooperative Research Centre for Sugar Industry Innovation through Biotechnology (CRC SIIB), reported the production of sugarcane containing 3.5% polymer. This development mirrors our earlier announcement of our accomplishments in switchgrass and provides a further proof-of-concept for polymer production directly from crops.”
THIRD QUARTER 2008 FINANCIAL OVERVIEW
Metabolix used $6.4 million of cash in operating activities for the third quarter 2008, which compares to net cash used of $0.9 million for the comparable quarter in 2007. Metabolix currently manages its finances with an emphasis on cash flow. Net cash used in operating activities increased as the Company expanded its activities in sales and marketing development, and research and product development. The Company expects its net cash used in operating activities to increase in future quarters as it expands its operations in advance of the full commercialization of Mirel and for the development of its longer term technology platforms.
The Company received $0.5 million in payments from ADM during the third quarter of 2008 for reimbursement of pre-commercial manufacturing expenses. Payments from ADM are recorded as long term deferred revenue on the Company’s balance sheet.
Total revenue in the quarter was $0.4 million, which included revenue recognized from delivery of Mirel sample product and government research grants.
For the three months ended September 30, 2008, total operating expenses were $10.6 million as compared to $10.0 million for the comparable quarter in 2007.
Research and development expenses were $6.6 million for the quarter ended September 30, 2008, up from $5.7 million for the comparable quarter in 2007. This increase was primarily the result of continued expansion of product development activities associated with developing new product grades and formulations for prospective customers, and increases in research and development personnel for polymer science and engineering primarily to support the Company’s collaborative agreement with ADM.
Selling, general and administrative expenses were $4.0 million for the three months ended September 30, 2008 as compared to $4.3 million for the comparable quarter in 2007. The change was primarily due to a decrease in stock-based compensation expense partially offset by increased expenses relating to expanded operations as the Company prepared for the commercialization of Mirel.
Construction of Commercial Manufacturing Facility
Construction of the commercial manufacturing facility at Clinton, Iowa is progressing. All major equipment is in place and buildings are approaching completion, control rooms and laboratories are being outfitted and operating manuals are being prepared. The Company remains on target for product shipments to customers during the second quarter of 2009.
Telles, the Company’s joint venture with ADM that produces Mirel bioplastics, recently entered into two new significant customer agreements. The first was with Ball Horticultural, as previously disclosed. This agreement is for the use of bioplastic sheet grade resin for the Ball Horticultural Company patented Soilwrap™. This is a new concept for a bottomless plant container that was test marketed in June at the twelfth annual LOHAS (Lifestyles of Health and Sustainability) Forum held in Boulder, Colorado. The Soilwrap made with Mirel is a fully biodegradable and compostable plant pot solution for the home gardener.
Telles also signed a three-year supply agreement with a Fortune 500 consumer products company. The targeted application will be an injection molded plastic product with launch planned for the second half of 2009. This initial supply contract is for one product line in one brand family; the customer has over a dozen brands, a number of which could be applicable for Mirel.
Conference Call Information
Richard Eno, the Company's President and CEO, and Joseph Hill, CFO, will host a conference call on Wednesday, November 5, 2008, at 4:30 p.m. (Eastern Time) to discuss these results. To participate, dial toll-free 1-888-684-1277 or 1-913-312-1410 (international). The passcode is 1084482. The conference call will be webcast and can be accessed from the Company's website at www.metabolix.com in the investor relations section.
To listen to a telephonic replay of the conference call, dial toll-free 1-888-203-1112 or 1-719-457-0820 for international callers and enter passcode 1084482. The replay will be available beginning at 7:30 p.m. (Eastern Time) on Wednesday, November 5, 2008 and will remain available through 11:59 PM (Eastern Time) November 12, 2008. In addition, the webcast will be archived on the Company's website in the investor relations section.