Lattice Biologics Ltd. Reports Third Quarter 2018 Results
Aug. 30, 2018
BELGRADE, Mont.--(BUSINESS WIRE)--Aug 30, 2018--Lattice Biologics Ltd. ( TSX-V: LBL ) (OTCBB: LBLTF) (“ Lattice Biologics ” or the “ Company ”) announces financial results for the three and nine months ending June 2018.
Sales and Product Offerings
FinanceSuccessfully relocated operations to Belgrade, Montana from Scottsdale, Arizona, resulting in operational efficiencies of over $145,000 per month, year over year. Gross profit of $534,093 on sales of $876,582 for the nine months ended June 30, 2018 compared to the same period in the previous year of $727,285 of gross profit on $2,340,834 of sales. Incurred a net loss of $0.9 million ($0.01 per share) for the nine months ended June 30, 2018 compared to $0.6 million ($0.01 per share) for the same period in the previous year, which included a $2.1 million gain on Grenville debt restructuring. Negative EBITDA for the nine months ended June 30, 2018 of $581,056 compared to negative EBITDA of $1,687,982 for the nine months ended June 30, 2017. Further efforts to improve the working capital condition of the Company include the conversion of $0.8 million of liabilities to equity in the year ended September 30, 2017.
Research and DevelopmentPatent pending for AmnioBoost product. Developed next generation AmnioBoost to super concentrate stem cells and cytokines. Re-formulated DBM putty to incorporate superior handling properties. Developed DBM fiber boats and strips to compete in spinal fusion market. Validated products to compete in new dental markets.
2018 Business Update:
“After a careful review of overhead and operational throughput, the Company decided to relocate operations to Belgrade, Montana in June of 2017. While we expected the move to generate savings of approximately $80,000 per month, the actual savings turned out to be roughly $145,000 per month over the last 9 months, said Guy Cook, CEO of Lattice Biologics.
Although sales are down year over year and quarter over quarter, the Company has begun to start processing for a large dental distributor which is expected to significantly increase sales in both the near and long term
“We remain focused on higher margin products as we continue to grow the business. With the reduction in overhead and associated expenses, the Company is well positioned to grow and be profitable in 2018 and beyond,” continues Cook.
The Company continues to make significant improvements on the balance sheet, and is working with creditors to convert certain balances to equity for working capital purposes.
Lattice Biologics maintains its commitment to honoring the gift of donation by implementing a strong quality control environment for the recovery and processing of donors. The Company has significantly increased its processing efficiencies, and has substantial inventory reserves to meet customer demand.
As indicated below, the Company continues efforts to diversify the sales mix across the new higher margin product lines added in prior years.
Third Quarter Financial Results (all figures denoted in USD):
The product launches have been well received by our clients and the Company continues to replace unprofitable legacy contracts and focus on the newer higher margin products. Lattice Biologics’ total revenue was $190,524 in the three months ended June 30, 2018 compared to $684,026 for the three months ended September 30, 2016, a decrease of 72.1%, as shown in the following quarter sales table:
The following table sets out selected unaudited financial information, prepared in accordance with IFRS. The information contained herein is drawn from interim financial statements of the Company for each of the following quarterly periods ending:
Certain adjustments have been made to the quarterly information for the first three quarters of the fiscal year ended September 30, 2016, as compared to data contained in the quarterly filings for such quarters. These changes relate to certain adjustments for cost of sales and operating costs that were not recognized until the fourth quarter of such fiscal year.
(i) Operating costs are defined as all general and administrative costs, professional fees, rent, salaries and benefits, sales and marketing, and utilities expenses.
(ii) EBITDA is defined as gross profit less operating costs (as defined above).
RESIGNATION OF CFO
Lattice Biologics Ltd. announces that Cheryl Farmer, Lattice Biologic’s Chief Financial Officer and Director, has resigned to pursue other opportunities.
"On behalf of the Board, I would like to wish Cheryl every success in her future endeavors," said Guy Cook, Chief Executive Officer.
Lattice Biologics has commenced the search for Ms. Farmer’s replacement and the Company will take the time necessary to find a suitable candidate.
About Lattice Biologics Ltd.:
Lattice Biologics is traded on the TSX-V under the symbol: LBL. The Company is an emerging personalized/precision medicine leader in the field of cellular therapies and tissue engineering, with a focus on bone, skin, and cartilage regeneration.
Lattice Biologics develops and manufactures biologic products to domestic and international markets. The Company’s products are used in a variety of surgical applications.
Lattice Biologics maintains its headquarters, laboratory and manufacturing facilities in Belgrade, Montana as well as offices in Phoenix, Arizona. The facility includes ISO Class 1000 and ISO Class 100 clean rooms, and specialized equipment capable of crafting traditional allografts and precision specialty allografts for various clinical applications. The Lattice Biologics team includes highly trained tissue bank specialists, surgical technicians, certified sterile processing and distribution technicians, and CNC operators who maintain the highest standards of aseptic technique throughout each step of the manufacturing process. From donor acceptance to the final packaging and distribution of finished allografts, Lattice is committed to maintaining the highest standards of allograft quality, innovation, and customer satisfaction.
Lattice Biologics maintains all necessary licensures to process and sell its tissue engineered products within the U.S. and internationally. This includes Certificates to Foreign Governments from the U.S. Food and Drug Administration (FDA) and registrations for 29 countries, which allow the export of bone, tendon, meniscus, ligament, soft tissue, and cartilage products outside of the U.S.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Cautionary Statement on Forward-Looking Information:
Certain information contained in this news release constitutes “forward-looking statements” within the meaning of the ‘safe harbour’ provisions of Canadian securities laws. All statements herein, other than statements of historical fact, are to be considered forward looking. Generally, forward-looking information can be identified by the use of forward-looking terminology such as “planned”, “potential”, “future”, “expected”, “could”, “possible”, “goal”, “intends”, “will” or similar expressions. Forward-looking statements in this news release include, without limitation: information pertaining to the Company’s strategy, plans, or future financial performance, such as statements with respect to the Transaction, and other statements that express management’s expectations or estimates of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lattice to be materially different from those expressed or implied by such forward-looking statements.
Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by management as of the date such statements are made, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The factors and assumptions that could prove to be incorrect, include, but are not limited to: that market prices will be consistent with expectations, the continued availability of capital and financing, and that general economic, market and business conditions will be consistent with expectations. The forward-looking statements are not guarantees of future performance. We disclaim any obligation to update or revise any forward-looking statements, except as required by law. Readers are cautioned not to put undue reliance on these forward-looking statements.
United States Advisory: The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered, sold, or resold in the United States or to, or for the account of or benefit of, a U.S. Person (as such term is defined in Regulation S under the U.S. Securities Act) unless an exemption from the registration requirements of the U.S. Securities Act is available. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in the state in the United States in which such offer, solicitation or sale would be unlawful.
Follow us on Twitter: @LatticeBio
View source version on businesswire.com:https://www.businesswire.com/news/home/20180830005811/en/
CONTACT: Lattice Biologics Ltd.
Guy Cook, 480-563-0800
KEYWORD: UNITED STATES NORTH AMERICA CANADA MONTANA
INDUSTRY KEYWORD: SURGERY HEALTH BIOTECHNOLOGY MEDICAL SUPPLIES
SOURCE: Lattice Biologics Ltd.
Copyright Business Wire 2018.
PUB: 08/30/2018 04:00 PM/DISC: 08/30/2018 04:00 PM