- Dyadic Closes $75 Million DuPont
Transaction on December 31, 2015 -- Dyadic Retains
C1 License to Focus in Pharmaceutical Sector --
All Debt Has Been Repaid or Converted into Dyadic Common Stock at
December 31, 2015 -|- Encouraging data generated
by Sanofi Pasteur indicates that the C1 produced antigen generated
an equal, or better, immune response in mice than the industry
standard antigen -- Dyadic is selected to
participate in the € 22 Million EU funded ZAPI
vaccine initiative -- Litigation Court Sets
January 6, 2017 Trial Date for Professional Liability Litigation
-- Cash and cash equivalents of $68.6 million as
of December 31, 2015 which excludes approximately $7.4 Million of
cash held in escrow until July 2017 from the DuPont Transaction
-
Dyadic International, Inc. ("Dyadic") (OTCQX:DYAI), a global
biotechnology company focused on further improving and leveraging
its patented and proprietary C1 expression system technology to
help speed up the development and production of biologic drugs at
flexible commercial scales, today announced financial results for
the year ended December 31, 2015.
“2015 has truly been a transformational year for
Dyadic and I am very excited about our future prospects,” said Mark
Emalfarb, chief executive officer of Dyadic. Mr. Emalfarb further
commented, “As we enter 2016, we are debt free and we have a strong
cash position with sufficient cash reserves to fund our previously
announced $15 million share repurchase program. In addition, I
believe we are uniquely positioned to build shareholder value by
leveraging our C1 technology in the pharmaceutical sector.”
BUSINESS HIGHLIGHTS AND RECENT
DEVELOPMENTS
On December 31, 2015 the Company completed the
sale of substantially all of the assets of its Industrial
Technology business to DuPont’s (NYSE:DD) Industrial Biosciences
business for $75 million in cash (the “DuPont Transaction”). The
Agreement provided for $8 million of the purchase price to be held
in an escrow account for 18 months to ensure Dyadic’s obligations
with respect to certain indemnity claims and working capital
adjustments. The escrow account balance at December 31, 2015 of
$7,361,182 is net of contractual working capital adjustments agreed
to by the parties.
DuPont has granted back to Dyadic co-exclusive
rights to the C1 technology for use in human and animal
pharmaceutical applications, with the exclusive ability to enter
into sub-license agreements in that field. DuPont will retain
certain rights to utilize the C1 technology for use in
pharmaceutical applications, including development and production
of pharmaceutical products, for which it will make royalty payments
to Dyadic upon commercialization. In certain circumstances, Dyadic
may owe a royalty to either DuPont or certain licensors of DuPont
depending upon whether Dyadic elects to utilize certain patents
either owned by DuPont or DuPont’s licensors.
The combination of a portion of the proceeds
from the DuPont Transaction and possible additional industry and
government funding being sought, are expected to provide Dyadic
with the opportunity to accelerate the further development and
optimization of the C1 technology for its use in the
biopharmaceutical industry to develop and manufacture human and
animal vaccines, monoclonal antibodies, biosimilars and/or
biobetters, and other therapeutic proteins. In addition, the unique
attributes of C1 may create attractive research, licensing,
collaboration and other opportunities if C1 demonstrates
operational efficiencies and reduced capital requirements for
biologic drug manufacturers.
Currently, we intend to continue our existing
program with Sanofi Pasteur and our participation in the EU funded
ZAPI vaccine preparedness program.
In addition, the Company has initiated
internally funded research & development pharmaceutical
programs and is reviewing a variety of options regarding its future
internal and external pharmaceutical research initiatives.
On January 12, 2016 the Company announced that
it repurchased and retired an aggregate of 2,136,752 shares of its
common stock at $1.35 per share for an aggregate purchase price of
$2,884,615 pursuant to a Securities Purchase Agreement entered into
with Abengoa Bioenergy New Technologies, LLC (“ABNT”). The $1.35
per share price is equal to the average conversion price that
Dyadic convertible debt holders received upon conversion of debt at
December 31, 2015.
On February 16, 2016 the Company initiated its
stock repurchase program, under which the Company may repurchase up
to $15 million of its outstanding common stock. Under the stock
repurchase program, Dyadic may repurchase shares in open-market
purchases in accordance with all applicable securities laws and
regulations, including Rule 10b-18 of the Securities Exchange Act
of 1934, as amended. The extent to which Dyadic repurchases its
shares, and the timing of such repurchases, will depend upon a
variety of factors, including market conditions, regulatory
requirements and other corporate considerations, as determined by
Dyadic’s management. The repurchase program may be extended,
suspended or discontinued at any time. The Company expects to
finance the program from existing cash resources. The number of
shares repurchased by the Company as of the date of this report was
688,655 at an average cost of $1.56 per share.
On March 3, 2016 the Company announced that in
its lawsuit against Defendants Greenberg Traurig, LLP, Greenberg
Traurig, P.A. (collectively, "Greenberg Traurig") and the Estate of
Robert I. Schwimmer, who previously represented the Company while
an attorney at Greenberg Traurig, and also against Defendant Bilzin
Sumberg Baena Price & Axelrod LLP ("Bilzin Sumberg"), the Court
issued an Order, dated March 2, 2016, scheduling the lawsuit for a
six-week jury trial commencing Friday, January 6, 2017.
FINANCIAL RESULTS YEAR ENDED DECEMBER
31, 2015
We have reclassified the revenues and expenses
of our industrial technology business to “income (loss) from
discontinued operations” and the related assets and liabilities to
“assets held for sale” and “liabilities related to assets held for
sale” for all of the periods presented in the accompanying
consolidated financial statements.
Results of Continuing
Operations:
At December 31, 2015, cash and cash equivalents,
excluding the approximately $7.4 million of cash held in escrow,
was approximately $68.6 million compared to $2.5 million at
December 31, 2014.
Net loss for the year ended December 31, 2015
was $1.5 million, or ($0.04) per basic and diluted share, compared
to a net loss of $5.4 million, or ($0.16) per basic and diluted
share, for the same period a year ago.
Research and development revenue for the year
ended December 31, 2015 was approximately $316,000 compared to
$106,000 for the same period a year ago. The increase in
revenue for the period reflects two ongoing biopharmaceutical
R&D projects.
Gross profit for the year ended December 31,
2015 increased to approximately $192,000, compared to a loss of
$97,000 for the same period a year ago. At this time the
Company has two ongoing biopharmaceutical R&D projects.
General and administrative expenses for the year
ended December 31, 2015 declined 27% to approximately $3,838,000
compared to $5,284,000 for the same period a year ago. The
decrease primarily reflects lower litigation costs of approximately
$1,266,000 and lower professional service costs, compensation and
project related spending of $180,000.
Research and Development expenses for the year
ended December 31, 2015 decreased to $0 from approximately $71,000
in 2014 as a result of the closure of our North Carolina lab in
April 2014.
Other income increased for the year ended
December 31, 2015 to approximately $2,181,000 compared to $28,000
for the same period a year ago. The increase principally
relates to the settlement with one of the defendant law firms in
its ongoing professional liability litigation.
Discontinued Operations resulting from
the DuPont Transaction:
Net income for year ended December 31, 2015 was
approximately $67.3 million, or $1.95 per basic and diluted share,
compared to a net loss of $575,800, or ($0.02) per basic and
diluted share, for the same period a year ago.
CONFERENCE CALL INFORMATION
Dyadic will host a shareholder call today,
Tuesday March 29, 2016 at 5:00 p.m. to discuss the financial
results for the full year of 2015 and discuss 2016 company
initiatives. In order to participate in the conference call, please
dial +719-325-2308 for International callers, and 888-452-4023 for
U.S./Canada callers, using code 3130746.
A replay of the conference call will be
available on Dyadic’s website (www.dyadic.com) within 24 hours
after the live event.
About Dyadic International,
Inc.
Dyadic International, Inc. is a global
biotechnology company which is developing what it believes will be
a potentially significant protein production system based on the
fungus Myceliopthora thermophila, nicknamed C1. The C1
microorganism, which enables the development and large scale
manufacture of low cost proteins, has the potential to be further
developed into a safe and efficient expression system that may help
speed up the development and production of biologic drugs at
flexible commercial scales. Dyadic is using the C1 technology
and other technologies to conduct research, development and
commercial activities for the development and manufacturing of
human and animal vaccines, monoclonal antibodies, biosimilars
and/or biobetters, and other therapeutic proteins. Dyadic pursues
research & development collaborations, licensing arrangements
and other commercial opportunities to leverage the value of these
technologies by providing its partners and collaborators with the
benefits of developing and manufacturing and/or utilizing the
biopharmaceuticals which these technologies help produce. In
particular, as the aging population grows in developed and
undeveloped countries, Dyadic believes the C1 technology may help
bring biologic drugs to market faster, in greater volumes and at
lower cost to drug developers and manufacturers and, hopefully, to
patients and the healthcare system. Please visit Dyadic’s website
at www.dyadic.com for additional information, including
details regarding Dyadic’s plans for its biopharmaceutical
business. Dyadic trades on the OTCQX tier of the OTC marketplace.
Investors can find real-time quotes, market information and
financial reports for Dyadic, as well as additional information
related to its professional liability lawsuit, in the Company’s
annual and quarterly reports which are filed with the OTC markets.
Please visit the OTC markets website at
www.otcmarkets.com/stock/DYAI/quote.
Safe Harbor Regarding Forward-Looking
Statements
Certain statements contained in this press
release are forward-looking statements within the meaning of the
federal securities laws. These forward-looking statements involve
risks, uncertainties and other factors that could cause Dyadic’s
actual results, performance or achievements to be materially
different from any future results, performance or achievements
expressed or implied by such forward-looking statements. Investors
are urged to consider these factors carefully in evaluating the
forward-looking statements and are cautioned not to place undue
reliance on such forward-looking statements. Any forward-looking
statements speak only as of the date of this press release and,
except as required by law, Dyadic expressly disclaims any intent or
obligation to update or revise any forward-looking statements to
reflect actual results, any changes in expectations or any change
in events. Factors that could cause results to differ materially
include, but are not limited to: (1) general economic conditions,
including the recent conditions in the global markets; (2) Dyadic’s
ability to retain and attract employees; (3) competitive pressures
and reliance on key customers and collaborators; (4) Dyadic’s
research and development efforts, (5) the outcome of the current
litigation by Dyadic against its former counsel, (6) Dyadic’s
ability to obtain additional debt or equity financing sources and
(7) other factors discussed in Dyadic’s publicly available filings,
including information set forth under the caption “Risk Factors” in
our December 31, 2015 Annual Report filed with OTC Markets on March
29, 2016. New risks and uncertainties arise from time to time, and
it is impossible for us to predict these events or how they may
affect us.
DYADIC INTERNATIONAL, INC. AND
SUBSIDIARIES |
|
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Years Ended December
31, |
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
|
|
REVENUES: |
|
|
|
|
|
|
Research and Development
Revenue |
|
|
$ |
315,712 |
|
|
$ |
105,738 |
|
|
|
|
|
|
|
|
|
COSTS
AND EXPENSES (INCOME): |
|
|
|
|
|
|
Costs of Goods Sold |
|
|
|
124,012 |
|
|
|
202,472 |
|
|
General and Administrative |
|
|
|
3,837,955 |
|
|
|
5,284,315 |
|
|
Research and Development |
|
|
|
- |
|
|
|
71,018 |
|
|
Gain on Sale of Assets |
|
|
|
- |
|
|
|
(19,755 |
) |
|
Total Expenses |
|
|
|
3,961,967 |
|
|
|
5,538,050 |
|
|
|
|
|
|
|
|
|
LOSS
FROM CONTINUING OPERATIONS BEFORE OTHER INCOME |
|
|
|
(3,646,255 |
) |
|
|
(5,432,312 |
) |
|
|
|
|
|
|
|
|
Other Income |
|
|
|
|
|
|
Interest Income |
|
|
|
11,156 |
|
|
|
28,055 |
|
|
Gain on Settlement of Litigation,
Net |
|
|
|
2,170,000 |
|
|
|
- |
|
|
Total Other Income |
|
|
|
2,181,156 |
|
|
|
28,055 |
|
|
|
|
|
|
|
|
|
LOSS
FROM CONTINUING OPERATIONS |
|
|
|
(1,465,099 |
) |
|
|
(5,404,257 |
) |
|
|
|
|
|
|
|
|
NET
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, Net of Income Taxes
of |
|
|
|
|
|
|
$1,076,100 and $0 in 2015 and 2014, Respectively |
|
|
|
67,252,417 |
|
|
|
(575,832 |
) |
|
|
|
|
|
|
|
|
NET
INCOME (LOSS) |
|
|
$ |
65,787,318 |
|
|
$ |
(5,980,089 |
) |
|
BASIC
AND DILUTED NET INCOME (LOSS) PER COMMON SHARE |
|
|
|
|
|
|
Basic and Diluted Net (Loss) from
continuing operations per share |
|
|
$ |
(0.04 |
) |
|
$ |
(0.16 |
) |
|
Basic and Diluted Net Income (Loss)
from discontinued operations per share |
|
|
|
1.95 |
|
|
|
(0.02 |
) |
|
Basic and Diluted Net Income (Loss)
per share |
|
|
$ |
1.91 |
|
|
$ |
(0.18 |
) |
|
Weighted-Average Common Shares Outstanding |
|
|
|
|
|
|
Basic and Diluted |
|
|
|
34,367,723 |
|
|
|
34,099,319 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
December 31, |
|
Balance Sheet
Information: |
|
|
2015 |
|
2014 |
|
|
|
|
|
|
|
|
Cash and Cash Equivalents |
|
|
$ |
68,601,138 |
|
|
$ |
2,495,455 |
|
|
Assets Held for Sale |
|
|
|
- |
|
|
|
5,681,151 |
|
|
Escrowed Funds from Sale of
Assets |
|
|
|
7,361,182 |
|
|
|
- |
|
|
Total Assets |
|
|
|
76,667,425 |
|
|
|
8,535,353 |
|
|
Liabilities Related to Assets Held
for Sale |
|
|
|
- |
|
|
|
1,721,373 |
|
|
Note Payable and Convertible
Debt |
|
|
|
- |
|
|
|
8,135,728 |
|
|
Accumulated Deficit |
|
|
|
(18,713,096 |
) |
|
|
(84,500,414 |
) |
|
Total Stockholders' Equity
(Deficit) |
|
|
|
73,794,505 |
|
|
|
(2,264,762 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
BALANCE
SHEET DISCONTINUED OPERATIONS |
|
|
|
|
|
|
|
December 31, |
|
|
|
|
2014 |
|
ASSETS HELD FOR SALE |
|
|
|
|
|
|
|
|
|
Accounts Receivable,
Net of Allowance for Doubtful Accounts of $64,382 |
|
$ |
1,044,990 |
|
Inventory, Net of
Inventory Reserves of $237,782 |
|
|
3,607,062 |
|
Prepaid Expenses and
Other Current Assets |
|
|
70,224 |
|
Fixed Assets, Net of
Accumulated Depreciation of $2,495,776 |
|
|
539,902 |
|
Intangible Assets, Net
of Accumulated Amortization of $710,199 |
|
|
418,973 |
|
Other Assets |
|
|
- |
|
|
|
$ |
5,681,151 |
|
|
|
|
|
|
LIABILITIES RELATED TO ASSETS HELD FOR SALE |
|
|
|
|
|
|
|
|
|
Accounts Payable |
|
$ |
1,008,338 |
|
Accrued
Expenses |
|
|
347,208 |
|
Deferred Research and
Development Obligation |
|
|
365,827 |
|
|
|
$ |
1,721,373 |
|
|
|
|
|
|
INCOME (LOSS) FROM DISCONTINUED
OPERATIONS |
|
|
|
|
|
|
Years Ended December 31, |
|
|
|
2015 |
|
|
|
2014 |
|
REVENUES: |
|
|
|
|
Product Related Revenue, Net |
|
$ |
11,989,604 |
|
|
$ |
9,779,232 |
|
License Fee revenue |
|
|
800,567 |
|
|
|
700,000 |
|
Research and Development
Revenue |
|
|
1,694,460 |
|
|
|
1,938,428 |
|
Total Revenue |
|
|
14,484,631 |
|
|
|
12,417,660 |
|
|
|
|
|
|
COSTS
AND EXPENSES (INCOME): |
|
|
|
|
Cost of Goods Sold |
|
|
9,231,916 |
|
|
|
7,779,059 |
|
General and Administrative |
|
|
3,407,178 |
|
|
|
829,341 |
|
Sales and Marketing |
|
|
957,577 |
|
|
|
1,243,801 |
|
Research and Development |
|
|
1,687,348 |
|
|
|
2,310,939 |
|
Foreign Currency Exchange Loss
(Gain), Net |
|
|
200,246 |
|
|
|
147,145 |
|
Total Expenses |
|
|
15,484,265 |
|
|
|
12,310,285 |
|
|
|
|
|
|
INCOME (LOSS) FROM DISCONTINUED OPERATIONS BEFORE OTHER INCOME
(EXPENSE) |
|
(999,634 |
) |
|
|
107,375 |
|
|
|
|
|
|
OTHER
INCOME (EXPENSE): |
|
|
|
|
Interest Expense |
|
|
(1,617,478 |
) |
|
|
(683,207 |
) |
Gain on Sale of Assets |
|
|
70,945,629 |
|
|
|
- |
|
Total Other Income (Expense) |
|
|
69,328,151 |
|
|
|
(683,207 |
) |
|
|
|
|
|
INCOME
(LOSS) FROM DISCONTINUED OPERATIONS BEFORE INCOME TAXES |
|
|
68,328,517 |
|
|
|
(575,832 |
) |
|
|
|
|
|
Provision for Income Taxes |
|
|
(1,076,100 |
) |
|
|
- |
|
NET
INCOME (LOSS) FROM DISCONTINUED OPERATIONS |
|
$ |
67,252,417 |
|
|
$ |
(575,832 |
) |
Contact:
Dyadic International, Inc.
Thomas L. Dubinski
Chief Financial Officer
Phone: 561-743-8333
Email: tdubinski@dyadic.com
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