[March 08, 2017] |
|
Arcadia Biosciences Announces Fourth-Quarter and Full-Year 2016 Financial Results and Business Highlights
Arcadia Biosciences, Inc. (Nasdaq: RKDA), an agricultural technology
company that creates value for farmers while benefitting the environment
and enhancing human health, today released its financial and business
results for the fourth quarter and full year of 2016.
The company's loss from operations was $5.5 million in the fourth
quarter and $18.6 million for the full year of 2016 compared to $4.1
million in the fourth quarter and $15.6 million for 2015. Net loss
attributable to common stockholders in the fourth quarter and full year
of 2016 was $5.7 million and $19.6 million, compared to $3.9 million and
$20.7 million for the comparable periods in 2015.
Cash on hand and investments at the end of the fourth quarter totaled
$53.1 million.
"2016 was a year of transition for Arcadia, as we focused on high value
yield and nutrition traits that we believe will deliver near-term
revenue," said Raj Ketkar, president and CEO. "After a comprehensive
strategic review, in Q4 we realigned the organization and operations to
conserve cash, and we expect to see the benefits of these changes in
2017.
"We will continue to work with our partners to advance our rich pipeline
of abiotic stress traits, such as nitrogen use efficiency, water use
efficiency and salinity tolerance," he added.
Business and Technology Highlights
Arcadia made the following business and technical achievements in the
fourth quarter of 2016:
-
SONOVA®
GLA safflower oil use in pet food. Arcadia is awaiting approval
from the FDA on its regulatory submission for GLA safflower oil use in
pet food, which is expected to open a new market for its highly
concentrated SONOVA GLA product.
-
Regulatory submittal for HB4 soybeans in China.
Through its Verdeca joint venture with Bioceres, Arcadia submitted a
regulatory dossier in China for import approval of HB4 stress tolerant
soybeans. The trait has received regulatory approval in Argentina,
with additional approvals pending in Uruguay and the U.S.
-
Kevin Comcowich joined board of directors.
Experienced business and financial executive Kevin Comcowich joined
Arcadia's board of directors on October 30, 2016. Comcowich most
recently served as the CEO and portfolio manager of HTX Energy Fund in
Houston, Texas and has extensive experience in investment management
and global capital market strategies. He will serve as an independent
director and member of the audit committee.
-
Organizational changes. Following a
comprehensive strategic review of all technology programs, partner
progress and market conditions, Arcadia realigned its organization to
support near-term product commercialization and preserve cash. This
included a reduction in workforce, management changes and
consolidation of facilities to reduce operating expenses by 15-20
percent
Since the close of the fourth quarter, Arcadia has announced the
following:
-
Arcadia Biosciences Obtains U.S. FDA GRAS Status
for SONOVA® GLA Safflower Oil. Arcadia followed FDA-proposed
procedures to establish its SONOVA® GLA safflower oil as GRAS under
the intended conditions of use. This process included convening an
expert panel to review the necessary product safety data and then
submitting a notification to the FDA.
-
Study Shows Arcadia's Nitrogen Use Efficiency
Trait Increases Yield in NERICA Rice. In field evaluations over
three growing seasons and in both upland and lowland rice production
systems, rice lines with Arcadia's NUE trait showed substantial yield
increases under different nitrogen application rates. The leading NUE
rice line showed a 34 percent increase over controls.
-
Origin, Arcadia Announce China Biotechnology
Collaboration in Corn. Arcadia announced a collaboration with
Origin Agritech to deregulate insect resistance/ herbicide tolerance
traits in corn. The project involves the first-ever export of a key
corn biotechnology product developed in China to the U.S., and Arcadia
will assist Origin in developing information for submission to
regulatory authorities in the U.S., China and other countries.
|
Arcadia Biosciences, Inc.
|
Financial Snapshot
|
(Unaudited)
|
($ in thousands)
|
|
|
|
Three Months Ended December 31
|
|
|
|
Year Ended December 31
|
|
|
|
2016
|
|
|
|
2015
|
|
|
|
% Favorable/
|
|
|
|
2016
|
|
|
|
2015
|
|
|
|
% Favorable/
|
|
|
|
|
|
|
|
|
|
(Unfavorable)
|
|
|
|
|
|
|
|
|
|
(Unfavorable)
|
|
Total Revenues
|
|
540
|
|
|
|
1,346
|
|
|
|
(60
|
%)
|
|
|
|
3,188
|
|
|
|
5,414
|
|
|
|
(41
|
%)
|
|
Total Operating Expenses
|
|
6,011
|
|
|
|
5,416
|
|
|
|
(11
|
%)
|
|
|
|
21,808
|
|
|
|
20,977
|
|
|
|
(4
|
%)
|
|
Loss From Operations
|
|
(5,471
|
)
|
|
|
(4,070
|
)
|
|
|
(34
|
%)
|
|
|
|
(18,620
|
)
|
|
|
(15,563
|
)
|
|
|
(20
|
%)
|
|
Net Loss
|
|
(5,708
|
)
|
|
|
(3,857
|
)
|
|
|
(48
|
%)
|
|
|
|
(19,624
|
)
|
|
|
(17,956
|
)
|
|
|
(9
|
%)
|
|
Net Loss Attributable to Common Stockholders
|
|
(5,708
|
)
|
|
|
(3,857
|
)
|
|
|
(48
|
%)
|
|
|
|
(19,624
|
)
|
|
|
(20,727
|
)
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
In the fourth quarter of 2016, revenues were $540,000, compared to
revenues of $1.3 million in the fourth quarter of 2015. For annual 2016,
overall revenues decreased to $3.2 million compared to $5.4 million
during the same period of 2015. The quarter-over-quarter and annual
results were primarily impacted by delays to the estimated
commercialization dates within the portfolio of license agreements as
well as the conclusion of certain contract research and government grant
projects in 2015.
Operating Expenses
In the fourth quarter of 2016, operating expenses were $6.0 million,
compared to $5.4 million in the fourth quarter of 2015. For annual 2016,
operating expenses were $21.8 million, compared to $21.0 million during
the same period in 2015. Research and development (R&D) spending
decreased by $303,000 in 2016, as a result of reduced subcontract work,
partially offset by increased costs associated with Arcadia's program in
corn trait development and commercialization initiated in early 2016.
General and administrative (SG&A) expenses increased by $1.1 million
during the same period, primarily due to severance costs associated with
the reductions in force.
Net Loss
Net loss for the fourth quarter of 2016 was $5.7 million, compared to
$3.9 million for the fourth quarter of 2015. Net loss for the year was
$19.6 million, compared to $18.0 million for 2015. The net loss in the
fourth quarter of 2015 included the effect of higher interest expense,
and also was impacted by non-cash adjustments to the value of
financing-related derivatives. Additionally, the fourth quarter of 2015
net loss included the effect of a reduction to the income tax provision.
Net Loss Attributable to Common Stockholders
Net loss attributable to common stockholders for the fourth quarter of
2016 was $5.7 million, compared to $3.9 million for the fourth quarter
of 2015. Net loss attributable to common stockholders for the year was
$19.6 million, compared to $20.7 million for 2015. The net loss
attributable to stockholders for 2015 included adjustments associated
with preferred share financing redemption rights and deemed dividends to
a warrant holder.
Per share net loss attributable to common stockholders for the fourth
quarter of 2016 was 13 cents, compared to 9 cents for the fourth quarter
of 2015, and 44 cents for 2016, compared to 73 cents for 2015. The
number of shares outstanding used to calculate the per-share losses
attributable to common stockholders for each period is weighted and
reflects the company's change from a private to a public company in May
2015.
Conference Call and Webcast
The company has scheduled a conference call for 4:30 p.m. Eastern (1:30
p.m. Pacific) to discuss third-quarter and year-to-date results and key
strategic achievements.
Interested participants can join the conference call using the following
numbers:
U.S. Toll-Free Dial-In:
|
|
+1-844-243-4690
|
International Dial-In:
|
|
+1-225-283-0138
|
Passcode:
|
|
68547235
|
|
|
|
A live webcast of the conference call will be available on the
"Investors" section of the Arcadia's website at www.arcadiabio.com.
Following completion of the call, a recorded replay will be available on
the company's investor website.
Safe Harbor Statement
"Safe Harbor" statement under the Private Securities Litigation Reform
Act of 1995: This press release and the accompanying conference call
contain forward-looking statements about the company and its products,
including statements relating to components of the company's long-term
financial success and ongoing plans; the company's traits, commercial
products, and collaborations; and the company's ability to manage the
regulatory processes for its traits and commercial products.
Forward-looking statements are subject to risks and uncertainties that
could cause actual results to differ materially, and reported results
should not be considered as an indication of future performance. These
risks and uncertainties include, but are not limited to: the company's
and its partners' ability to develop commercial products incorporating
its traits and to complete the regulatory review process for such
products; the company's compliance with laws and regulations that impact
the company's business, and changes to such laws and regulations; and
the company's future capital requirements and ability to satisfy its
capital needs. Further information regarding these and other factors
that could affect the company's financial results is included in filings
the company makes with the Securities and Exchange Commission from time
to time, including the section entitled "Risk Factors" in the company's
Quarterly Report on Form 10-Q for the quarter ended September 30, 2016
and additional information that will be set forth in its Form 10-K for
the year ended December 31, 2016. These documents are or will be
available on the SEC (News - Alert) Filings section of the Investor Relations pages of
the company's website at www.arcadiabio.com.
All information provided in this release and in the attachments is as of
the date hereof, and Arcadia Biosciences, Inc. undertakes no duty to
update this information.
About Arcadia Biosciences, Inc.
Based in Davis, Calif., Arcadia Biosciences (Nasdaq: RKDA) develops
agricultural products that create added value for farmers while
benefitting the environment and enhancing human health. Arcadia's
agronomic performance traits, including Nitrogen Use Efficiency, Water
Use Efficiency, Salinity Tolerance, Heat Tolerance and Herbicide
Tolerance, are all aimed at making agricultural production more
economically efficient and environmentally sound. Arcadia's nutrition
traits and products are aimed at creating healthier ingredients and
whole foods with lower production costs. For more information, visit www.arcadiabio.com.
|
Arcadia Biosciences, Inc.
|
Condensed Consolidated Balance Sheets
|
(Unaudited)
|
(In thousands, except share data)
|
|
|
|
As of December 31,
|
|
|
|
2016
|
|
|
2015
|
|
Assets
|
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
2,013
|
|
|
$
|
23,973
|
|
Short-term investments
|
|
|
48,547
|
|
|
|
26,270
|
|
Accounts receivable
|
|
|
349
|
|
|
|
706
|
|
Unbilled revenue
|
|
|
184
|
|
|
|
82
|
|
Inventories - current
|
|
|
252
|
|
|
|
294
|
|
Prepaid expenses and other current assets
|
|
|
877
|
|
|
|
692
|
|
Total current assets
|
|
|
52,222
|
|
|
|
52,017
|
|
Property and equipment, net
|
|
|
508
|
|
|
|
585
|
|
Inventories - noncurrent
|
|
|
1,327
|
|
|
|
1,867
|
|
Long-term investments
|
|
|
2,498
|
|
|
|
19,748
|
|
Other noncurrent assets
|
|
|
19
|
|
|
|
25
|
|
Total assets
|
|
$
|
56,574
|
|
|
$
|
74,242
|
|
Liabilities and stockholders' equity
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
$
|
2,359
|
|
|
$
|
2,423
|
|
Amounts due to related parties
|
|
|
30
|
|
|
|
19
|
|
Unearned revenue - current
|
|
|
740
|
|
|
|
1,008
|
|
Total current liabilities
|
|
|
3,129
|
|
|
|
3,450
|
|
Notes payable
|
|
|
25,127
|
|
|
|
24,930
|
|
Unearned revenue - noncurrent
|
|
|
3,120
|
|
|
|
2,637
|
|
Other noncurrent liabilities
|
|
|
3,000
|
|
|
|
3,000
|
|
Total liabilities
|
|
|
34,376
|
|
|
|
34,017
|
|
Stockholders' equity:
|
|
|
|
|
|
|
|
|
Common stock, $0.001 par value-400,000,000 shares authorized as of
|
|
|
|
|
|
|
|
|
December 31, 2016 and December 31, 2015; 44,487,678 and 44,184,195
|
|
|
|
|
|
|
|
|
shares issued and outstanding as of December 31, 2016 and December
|
|
|
|
|
|
|
|
|
31, 2015, respectively
|
|
|
44
|
|
|
|
44
|
|
Additional paid-in capital
|
|
|
173,723
|
|
|
|
172,222
|
|
Accumulated deficit
|
|
|
(151,550
|
)
|
|
|
(131,926
|
)
|
Accumulated other comprehensive loss
|
|
|
(19
|
)
|
|
|
(115
|
)
|
Total stockholders' equity
|
|
|
22,198
|
|
|
|
40,225
|
|
Total liabilities and stockholders' equity
|
|
$
|
56,574
|
|
|
$
|
74,242
|
|
|
|
|
|
|
|
|
|
|
Arcadia Biosciences, Inc.
|
Condensed Consolidated Statements of Operations and Comprehensive
Loss
|
(Unaudited)
|
(In thousands, except share and per share data)
|
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
|
2015
|
|
Revenues:
|
|
|
|
|
|
|
|
|
Product
|
|
$
|
669
|
|
|
$
|
466
|
|
License
|
|
|
144
|
|
|
|
1,216
|
|
Contract research and government grants
|
|
|
2,375
|
|
|
|
3,732
|
|
Total revenues (which includes $0 and $91
|
|
|
|
|
|
|
|
|
from related parties )
|
|
|
3,188
|
|
|
|
5,414
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
Cost of product revenues
|
|
|
895
|
|
|
|
892
|
|
Research and development
|
|
|
8,663
|
|
|
|
8,966
|
|
Selling, general and administrative
|
|
|
12,250
|
|
|
|
11,119
|
|
Total operating expenses
|
|
|
21,808
|
|
|
|
20,977
|
|
Loss from operations
|
|
|
(18,620
|
)
|
|
|
(15,563
|
)
|
Interest expense
|
|
|
(1,319
|
)
|
|
|
(2,658
|
)
|
Other income, net
|
|
|
340
|
|
|
|
521
|
|
Loss on extinguishment of debt
|
|
|
-
|
|
|
|
(230
|
)
|
Net loss before income taxes
|
|
|
(19,599
|
)
|
|
|
(17,930
|
)
|
Income tax provision
|
|
|
(25
|
)
|
|
|
(26
|
)
|
Net loss
|
|
|
(19,624
|
)
|
|
|
(17,956
|
)
|
Accretion of redeemable convertible preferred stock to
|
|
|
|
|
|
|
|
|
redemption value
|
|
|
-
|
|
|
|
(2,574
|
)
|
Deemed dividends to warrant holder
|
|
|
-
|
|
|
|
(197
|
)
|
Net loss attributable to common stockholders
|
|
$
|
(19,624
|
)
|
|
$
|
(20,727
|
)
|
Net loss per share attributable to common stockholders:
|
|
|
|
|
|
|
|
Basic and diluted
|
|
$
|
(0.44
|
)
|
|
$
|
(0.73
|
)
|
Weighted-average number of shares used in per share
|
|
|
|
|
|
|
|
|
calculations:
|
|
|
-
|
|
|
|
|
|
Basic and diluted
|
|
|
44,366,816
|
|
|
|
28,559,119
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
|
|
Unrealized gains (losses) on available-for-sale securities
|
|
|
96
|
|
|
|
(115
|
)
|
Other comprehensive income (loss)
|
|
|
96
|
|
|
|
(115
|
)
|
Comprehensive loss attributable to common stockholders
|
|
$
|
(19,528
|
)
|
|
$
|
(20,842
|
)
|
|
|
|
|
|
|
|
|
|
Arcadia Biosciences, Inc.
|
Condensed Consolidated Statements of Cash Flows
|
(Unaudited)
|
(In thousands)
|
|
|
|
Year Ended December 31,
|
|
|
|
2016
|
|
|
2015
|
|
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(19,624
|
)
|
|
$
|
(17,956
|
)
|
Adjustments to reconcile net loss to cash used in operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
304
|
|
|
|
294
|
|
Loss (gain) on disposal of equipment
|
|
|
4
|
|
|
|
(10
|
)
|
Net amortization of investment premium
|
|
|
140
|
|
|
|
85
|
|
Payment of research and develop fees with cost investment
|
|
|
-
|
|
|
|
500
|
|
Stock-based compensation
|
|
|
1,059
|
|
|
|
1,392
|
|
Change in fair value of derivative liabilities related to
|
|
|
|
|
|
|
|
|
convertible promissory notes
|
|
|
-
|
|
|
|
9
|
|
Gain on expiration of warrant and derivative liability related
|
|
|
|
|
|
|
|
|
to notes payable upon IPO
|
|
|
-
|
|
|
|
(437
|
)
|
Accretion of debt discount
|
|
|
198
|
|
|
|
837
|
|
Loss on extinguishment of debt
|
|
|
-
|
|
|
|
230
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
357
|
|
|
|
336
|
|
Unbilled revenue
|
|
|
(102
|
)
|
|
|
298
|
|
Inventories
|
|
|
582
|
|
|
|
412
|
|
Prepaid expenses and other current assets
|
|
|
(185
|
)
|
|
|
(415
|
)
|
Other noncurrent assets
|
|
|
5
|
|
|
|
49
|
|
Accounts payable and accrued expenses
|
|
|
(19
|
)
|
|
|
125
|
|
Amounts due to related parties
|
|
|
11
|
|
|
|
(37
|
)
|
Unearned revenue
|
|
|
215
|
|
|
|
(821
|
)
|
Net cash used in operating activities
|
|
|
(17,055
|
)
|
|
|
(15,109
|
)
|
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Proceeds from sale of property and equipment
|
|
|
-
|
|
|
|
10
|
|
Purchases of property and equipment
|
|
|
(231
|
)
|
|
|
(151
|
)
|
Purchases of investments
|
|
|
(41,385
|
)
|
|
|
(48,719
|
)
|
Proceeds from sales and maturities of investments
|
|
|
36,315
|
|
|
|
2,500
|
|
Net cash used in investing activities
|
|
|
(5,301
|
)
|
|
|
(46,360
|
)
|
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock upon IPO
|
|
|
-
|
|
|
|
68,227
|
|
Payments of IPO issuance costs
|
|
|
-
|
|
|
|
(8,205
|
)
|
Proceeds from issuance of notes payable
|
|
|
-
|
|
|
|
45,000
|
|
Payments of debt issuance costs
|
|
|
(46
|
)
|
|
|
(396
|
)
|
Payments of debt extinguishment costs
|
|
|
-
|
|
|
|
(1,319
|
)
|
Proceeds from exercise of stock options and purchases through ESPP
|
|
|
442
|
|
|
|
360
|
|
Payments on notes payable to related party
|
|
|
-
|
|
|
|
(8,000
|
)
|
Payments on notes payable and convertible promissory notes
|
|
|
-
|
|
|
|
(26,796
|
)
|
Net cash provided by financing activities
|
|
|
396
|
|
|
|
68,871
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
(21,960
|
)
|
|
|
7,402
|
|
Cash and cash equivalents - beginning of period
|
|
|
23,973
|
|
|
|
16,571
|
|
Cash and cash equivalents - end of period
|
|
$
|
2,013
|
|
|
$
|
23,973
|
|
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
|
|
|
|
|
|
|
|
Cash paid for interest
|
|
$
|
1,033
|
|
|
$
|
2,050
|
|
Cash paid for income taxes
|
|
$
|
29
|
|
|
$
|
149
|
|
NONCASH INVESTING AND FINANCING ACTIVITIES:
|
|
|
|
|
|
|
|
|
Accretion of redeemable convertible preferred stock
|
|
$
|
-
|
|
|
$
|
2,574
|
|
Debt issuance costs included in accounts payable and accrued expenses
|
|
$
|
-
|
|
|
$
|
46
|
|
Reclassification of deferred IPO costs to equity
|
|
$
|
-
|
|
|
$
|
5,022
|
|
Deemed dividend to common stock warrant holder
|
|
$
|
-
|
|
|
$
|
197
|
|
Issuance of warrants and derivatives in connection with notes
payable issuance
|
|
$
|
-
|
|
|
$
|
437
|
|
Stock option exercise cost included in accounts receivable
|
|
$
|
-
|
|
|
$
|
1
|
|
Conversion of preferred stock to common stock upon IPO
|
|
$
|
-
|
|
|
$
|
85,455
|
|
|
|
|
|
|
|
|
|
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20170308006191/en/
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