Hofseth Biocare ASA: Fourth Quarter 2019 Financial Report
Hofseth BioCare ASA ("HBC") had operating revenues of NOK 11.1m (NOK 14.5m) in the fourth quarter of 2019. Cost of Goods Sold (CoGS) amounted to NOK 8.4m (NOK 9.9m) in the period. Operational profit (EBITDA) for the fourth quarter 2019 was negative NOK 15.0m (NOK 13.1m). Net financial items in the fourth quarter were negative NOK 2.6m (negative NOK 4.6m). Loss before tax was NOK 25.6m in the quarter, compared to a loss of NOK 23.5m during fourth quarter 2018.
Cash flow from operations during the fourth quarter was negative NOK 10.8m compared to positive NOK 46.2m in the same quarter last year. Cash and cash equivalents decreased by NOK 14.8m during the quarter, leaving total holding of cash and cash equivalents at NOK 94.6m by the end of the period.
Total assets for HBC were NOK 302.7m at the end of fourth quarter of 2019 (NOK 187.9m). Deferred tax assets are not posted in the balance sheet. Estimated value is NOK 141.0m. Total equity amounted to NOK 126.3m (NOK 86.0m) giving an equity ratio of 41.7 % (45.8 %) for the group.
UPDATE ON GOL
In the past 6 months, since execution of the LOI between Hofseth Biocare and Garden of Life, both parties have been engaged in formulation development, non-GMO certification, quality assurance approvals, product marketing and raw material forecasting.
Garden of Life is working with Hofseth Biocare and other partners to create approvable flavours, and with their retail partners to align on 2020 planogram slotting and determination of initial fill dates. Everyone is excited to launch these innovative salmon ingredients.
Hofseth Biocare has committed to Garden of Life that it will continue to develop new health claims that will help with product marketing and consumer satisfaction. Hofseth Biocare has also optimized salmon offcut supply chains in order to have sufficient raw material available for volumes above initial forecasts.
PRODUCTION UPDATE
In the fourth quarter of 2019, HBC Midsund processed 3,275 tons of salmon and trout raw materials. This is an increase of 662 tons compared to previous quarter, which is due to the summer break and the annual maintenance program for key components taking place in the plant in Q2. Compared to the same quarter in 2018, we have an increase of 625 tons (+23,6%). The reason for this increase is capacity improvements in the plant, as well as improved raw material access. A total of 914 tons of finished goods were manufactured at all HBC plants, compared to 791 tons in the same quarter 2018.
R&D
Situational anemia treatment: Our second placebo-controlled, randomized, double-blind eight-week clinical trial on daily supplementation with 12g of Salmon Protein Hydrolysate (ProGo®/CollaGo®) powder was completed with excellent primary and secondary outcome efficacy results and with no AE’s reported.
Gastro-intestinal (GI) protective medical food: This quarter we completed both the preclinical animal model as well as gene-regulation studies at Prof. Karl Sylvester's lab at the Stanford School of Medicine (SSM). The results were statistically positive, with ProGo®/CollaGo® (SPH) showing significant prophylactic protection of H2O2-induced injury of the GI tract in neonatal mice at a moderate 100 ug/ml SPH dose as well as significant upregulation of GI anti-inflammatory genes in GI tissue samples.
More detailed information on HBC's R&D work and pipeline can be found in the report.
HIGHLIGHTS IN THE FOURTH QUARTER 2019
- Garden of Life and Atlantic Sapphire projects are continuing to develop positively
- HBC finished our second placebo-controlled, randomized, double-blind eight-week clinical trial on treatment of situational anemia with strong results
- Completed both the preclinical animal model as well as gene-regulation studies on Reducing Gastrointestinal (GI) inflammation at Stanford School of Medicine
- In September, the HBC Berkåk facility ended toll manufacturing for an animal feed client and it was upgraded for food grade production, approval of which was granted by The Norwegian Food Authorities in October
- In October, HBC hired two new sales resources in Norway, Mr. Ove Brant-Hansen and Mr. Sindre Alnes
- In October, HBC also entered into a consultancy agreement with James Berger, through his company Nevera AG
- In October, HBC entered into a consultancy agreement with Dr. Crawford Currie to strengthen medical R&D and Investor Relations
Please find the Fourth Quarter 2019 Financial Report attached.
For further information, please contact:
James Berger, Head of Investor Relations & Strategy of Hofseth BioCare ASA
Phone:
E-mail:
Jon Olav Ødegård, CFO of Hofseth BioCare ASA
Mob:
E-mail:
About Hofseth BioCare ASA:
HBC is a Norwegian biotech company that develops high-value ingredients and finished products. Ingredients are further developed into discovery and pre-clinical studies in multiple clinics and university research labs in several countries. Lead clinical and pre-clinical candidates are development towards a Gastro-Intestinal (GI) Protective Medical Food, Medical Food to help treat age-related Sarcopenia, and future phase 1 studies on treatment of Anemia and NEC-IBS with Salmon Protein Hydrolysate fractions.
The company is founded on the core values of sustainability, traceability and optimal utilization of natural resources. Through an innovative hydrolysis technology, HBC can preserve the quality of lipids, proteins and calcium from fresh salmon off-cuts. Hofseth BioCare's headquarters are in Ålesund, Norway with branches in Oslo, Chicago, Mumbai, Palo Alto and Tokyo.
HBC is listed on Oslo Stock Exchange Axess list with ticker "HBC". More information about Hofseth BioCare at hofsethbiocare.com and facebook.com/hofsethbiocare
This information is subject to the disclosure requirements pursuant to Section 5-12 of the Norwegian Securities Trading Act
Attachment
