Avid Bioservices, Inc.
Mar 12, 2018

Avid Bioservices Reports Financial Results for Third Quarter of Fiscal Year 2018 and Recent Developments

   Company Remains on Target for Full Year Revenue of $50.0 - $55.0 Million             

Intensified Business Development Effort Results in New Customer Contract and Strengthened Backlog 

                     
TUSTIN, Calif., March 12, 2018 (GLOBE NEWSWIRE) -- Avid Bioservices, Inc. (NASDAQ:CDMO) (NASDAQ:CDMOP), a dedicated contract development and manufacturing organization (CDMO) working to improve patient lives by providing high quality development and manufacturing services to biotechnology and pharmaceutical companies, today announced financial results for the third quarter of fiscal year (FY) 2018 ended January 31, 2018, and provided an update on its contract manufacturing operations, and other corporate highlights.

Highlights Since October 31, 2017

"During and subsequent to our third quarter of fiscal year 2018, Avid completed two primary objectives.  We successfully divested the company's lead immuno-oncology assets to an organization with the financial resources and expertise to advance them, and we established a new operational structure that will allow our business to take full advantage of the substantial and growing demand for biologics manufacturing," said Roger Lias, Ph.D., president and chief executive officer of Avid Bioservices.  "With the divestiture of our lead R&D assets, our transition to a dedicated CDMO business is complete, and our team is entirely focused on expanding and diversifying our customer base, as well as strengthening our process development capabilities.  At present, we are in late-stage negotiations with several potential new customers and expect to announce the executed agreements before the end of the fiscal year. In recent weeks, we also completed a financing raising $23.2 million in gross proceeds.  These funds are essential as they will support our operations, including upgrading our process development capabilities to ensure that we are fully capable of servicing our customers with the highest quality standards and equipment.  We made rapid progress during the third quarter that we believe will allow us to build backlog and achieve sustainable growth in the future."

Recent CDMO Developments
                   

Recent Corporate Developments and Financial Highlights

More detailed financial information and analysis may be found in Avid's Quarterly Report on Form 10-Q, which will be filed with the Securities and Exchange Commission today.

Conference Call

Avid will host a conference call and webcast this afternoon, March 12, 2018, at 4:30 PM EDT (1:30 PM PDT).

To listen to the conference call, please dial (877) 312-5443 or (253) 237-1126 and request the Avid Bioservices conference call. To listen to the live webcast, or access the archived webcast, please visit: http://ir.avidbio.com/events.cfm.

About Avid Bioservices, Inc.
Avid Bioservices is a dedicated contract development and manufacturing organization (CDMO) focused on development and cGMP manufacturing of biopharmaceutical products derived from mammalian cell culture.  The company provides a comprehensive range of process development, high quality cGMP clinical and commercial manufacturing services for the biotechnology and biopharmaceutical industries.  With nearly 25 years of experience producing monoclonal antibodies and recombinant proteins in batch, fed-batch and perfusion modes, Avid's services include cGMP clinical and commercial product manufacturing, purification, bulk packaging, stability testing and regulatory strategy, submission and support.  The company also provides a variety of process development activities, including cell line development and optimization, cell culture and feed optimization, analytical methods development and product characterization.  For more information, please visit  www.avidbio.com.

Forward-Looking Statements
Statements in this press release which are not purely historical, including statements regarding Avid Bioservices' intentions, hopes, beliefs, expectations, representations, projections, plans or predictions of the future, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements involve risks and uncertainties including, but not limited to, the risk the company may experience delays in engaging new clients, the risk that the company may experience technical difficulties in processing customer orders which could delay delivery of products to customers, revenue recognition and receipt of payment or the loss of the customer, the risk that one or more existing customers terminates its contract prior to completion or reduces or delays its demand for development or manufacturing services, the risk that the company may need to use the majority of its cash to fund operations, thereby delaying the contemplated upgrade to its process development capabilities and expansion plans, and the risk that the company may not receive the full $8 million up front payment from Oncologie. Our business could be affected by a number of other factors, including the risk factors listed from time to time in our reports filed with the Securities and Exchange Commission including, but not limited to, our annual report on Form 10-K for the fiscal year ended April 30, 2017 and subsequent quarterly reports on Form 10-Q, as well as any updates to these risk factors filed from time to time in our other filings with the Securities and Exchange Commission. We caution investors not to place undue reliance on the forward-looking statements contained in this press release, and we disclaim any obligation, and do not undertake, to update or revise any forward-looking statements in this press release except as may be required by law.

AVID BIOSERVICES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED)

 Three Months Ended
January 31,
  Nine Months Ended
January 31,
  2018   2017   2018   2017 
        
Contract manufacturing revenue$  6,819,000  $  10,747,000  $  46,678,000  $  39,726,000 
Cost of contract manufacturing 10,951,000   7,974,000   47,641,000   26,477,000 
  Gross profit (loss)

 
 (4,132,000)   2,773,000   (963,000)  13,249,000 
        
Operating expenses:       
  Selling, general and administrative 4,824,000   4,365,000   12,273,000   13,602,000 
  Restructuring charges       1,258,000    
  Total operating expenses 4,824,000   4,365,000   13,531,000   13,602,000 
        
Operating loss (8,956,000)  (1,592,000)  (14,494,000)  (353,000 )
        
Other income (expense):        
  Interest and other income 42,000   25,000   83,000   71,000 
  Interest and other expense  (14,000)  (2,000)  (18,000)   (2,000)
        
Loss from continuing operations$  (8,928,000) $  (1,569,000) $ (14,429,000) $  (284,000)
Loss from discontinued operations  (2,076,000)  (6,205,000)  (10,404,000)   (22,603,000)
        
Net loss$  (11,004,000) $  (7,774,000) $ (24,833,000) $  (22,887,000)
        
Comprehensive loss$  (11,004,000) $  (7,774,000) $ (24,833,000) $  (22,887,000)
        
Series E preferred stock accumulated dividends (1,442,000)  (1,442,000)  (3,604,000)  (3,558,000)
        
Net loss attributable to common stockholders

$
 

  (12,446,000


)
 

$
 

  (9,216,000


)
 

$
 

(28,437,000


)
 

$
 

  (26,445,000


)
        
Basic and diluted weighted average common shares outstanding(1):  

45,225,804
    

37,258,794
    

45,032,335
    

35,486,782
 
        
Basic and diluted net loss per common share attributable to common stockholders (1):       
  Continuing operations$  (0.23) $  (0.08) $  (0.40) $  (0.11)
  Discontinued operations$   (0.05) $  (0.17) $  (0.23) $  (0.64)
Net loss per share attributable to common stockholders$  (0.28) $  (0.25) $  (0.63)  $  (0.75)
        
(1)  All share and per share amounts of our common stock for all prior fiscal year periods presented have been retroactively adjusted to reflect the one-for-seven reverse stock split of our issued and outstanding common stock, which took effect on July 10, 2017.

 

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AVID BIOSERVICES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

 January 31,
2018
 April 30,
2017
 Unaudited  
ASSETS   
Current assets:   
Cash and cash equivalents$  17,938,000   $  46,799,000 
Trade and other receivables 7,967,000   7,742,000 
Inventories 14,218,000   33,099,000 
Prepaid expenses 906,000   1,460,000 
Total current assets 41,029,000   89,100,000 
Property and equipment, net 26,325,000   26,515,000 
Restricted cash 1,150,000   1,150,000 
Other assets 1,353,000   1,347,000 
Total assets$  69,857,000  $  118,112,000 
LIABILITIES AND STOCKHOLDERS' EQUITY   
Current liabilities:   
Accounts payable$  1,911,000  $  5,779,000 
Accrued clinical trial and related fees 5,503,000   4,558,000 
Accrued payroll and related costs 3,876,000   6,084,000 
Deferred revenue 6,633,000   28,500,000 
Customer deposits 17,602,000   17,017,000 
Other current liabilities 749,000   993,000 
Total current liabilities 36,274,000   62,931,000 
    
Deferred rent, less current portion 2,064,000   1,599,000 
    
Commitments and contingencies   
    
Stockholders' equity:   
Preferred stock—$0.001 par value; authorized 5,000,000 shares; 1,647,760 issued and outstanding at January 31, 2018 and April 30, 2017, respectively  

 

2,000
    

 

2,000
 
Common stock—$0.001 par value; authorized 500,000,000 shares;
45,257,180 and 44,014,040 issued and outstanding at January 31, 2018 and April 30, 2017, respectively
  

 

 

45,000
    

 

 

44,000
 
Additional paid-in capital 593,621,000   590,971,000 
Accumulated deficit  (562,149,000)  (537,435,000)
Total stockholders' equity  31,519,000   53,582,000 
Total liabilities and stockholders' equity$  69,857,000  $  118,112,000 
   
Contacts:

Stephanie Diaz (Investors) 

Vida Strategic Partners   

415-675-7401

sdiaz@vidasp.com  



Tim Brons (Media)

Vida Strategic Partners

415-675-7402

tbrons@vidasp.com









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Source: Avid Bioservices, Inc

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