SAN DIEGO--(EON: Enhanced Online News)--PURE Bioscience, Inc. (OTCQB: PURE), creator of the patented non-toxic silver dihydrogen citrate (SDC) antimicrobial, today reported financial results for the fiscal second quarter and six-month periods ended January 31, 2017.
“The momentum in our improving food safety revenues and sales traction is evident in our results and is further supported by a number of post fiscal Q2 events.”
Q2: Summary of Results of Operations
Revenues for the fiscal second quarter ended January 31, 2017
increased 154% to $447,000, compared with revenues of $176,000 in the
prior year fiscal second quarter ended 2016.
- Core food safety revenues for the second quarter increased 149% as compared with food safety revenues in the fiscal second quarter ended 2016.
- Net loss, excluding non-cash derivative income, for the fiscal second quarter 2017 was $1.4 million, as compared with $2.3 million for fiscal second quarter in 2016.
- Net loss per share was ($0.01) as compared with ($0.19) for the fiscal second quarter ended 2017 and 2016.
- Gross margin was 70% during the second quarter of fiscal 2017 as compared with 73% during the same period in fiscal 2016.
Six Months: Summary of Results of Operations
Revenues for the fiscal first six months ended January 31, 2017
increased 170% to $978,000 compared with prior year six-month revenues
- Core food safety revenues for the six months increased 463% as compared with food safety revenues in the six months ended 2016.
- Net loss for the six months, excluding non-cash derivative income, was $3 million compared with $4.1 million for the six month period in 2016.
- Net loss per share was ($0.04) as compared with ($0.27) for the six months ended fiscal 2017 and 2016.
- As expected, gross margin declined to 59% during the first six months of fiscal 2017 as compared with 72% during the same six-month period in fiscal 2016.
Hank R. Lambert, CEO, said that, “The momentum in our improving food safety revenues and sales traction is evident in our results and is further supported by a number of post fiscal Q2 events.
“This calendar quarter, another national restaurant chain will begin testing PURE® Hard Surface disinfectant. We continue to experience heightened interest from new customers who are contacting us as a result of Chipotle Mexican Grill’s chain wide adoption (in late calendar ’16) of PURE Hard Surface disinfectant as a food safety solution to eliminate and prevent Norovirus and other viruses and bacteria. Also, with the addition of a number of new national manufacturers and processors using PURE Hard Surface for environmental and equipment surface disinfection, we are on track to more than double our customer base in this segment.
“Now that a leading produce supplier has completed its validation and optimization testing of PURE Control® in its pilot plant and moved into a production plant, we look forward to receiving our first order for FDA approved PURE Control, a direct food contact processing aid to be applied directly onto fresh produce (a new $300+ million US market segment).
“With the anticipated calendar Q2 USDA approval for the use of PURE Control as a poultry processing aid to significantly reduce Salmonella contamination, we can begin sales into the $350+ million US poultry processing aids market.”
Lambert continued, “Our mission is to protect people and protect company brands by providing superior, leading edge food safety solutions to prevent foodborne illness. We have the team in place and the financial runway to execute on our business plan and achieve our goals. We continue to look forward to calendar 2017 as our breakout year.”
2017 Fiscal Second Quarter Financial Results Conference Call
The Participant Dial-In Number for the conference call is 1-631-891-4304. Participants should dial in to the call at least five minutes before 1:30 p.m. PST (4:30 p.m. EST) on March 2, 2017. The call can also be accessed “live” online at http://public.viavid.com/index.php?id=122970.
A replay of the webcast will be available on the Company’s website (http://www.purebio.com/about/investor_relations). A replay of the conference call will be available by dialing 1-844-512-2921 (international participants dial 1-412-317-6671) starting March 2, 2017, at 7:30 p.m. EST through March 9, 2016 at 11:59 p.m. EST. Please use PIN Number 10002473.
About PURE Bioscience, Inc.
PURE Bioscience, Inc. is focused on developing and commercializing our proprietary antimicrobial products primarily in the food safety arena -- providing solutions to the health and environmental challenges of pathogen and hygienic control. Our technology platform is based on patented stabilized ionic silver, and our initial products contain silver dihydrogen citrate, or SDC. SDC is a broad-spectrum, non-toxic antimicrobial agent, which offers 24-hour residual protection and formulates well with other compounds. As a platform technology, SDC is distinguished from existing products in the marketplace because of its superior efficacy, reduced toxicity and it mitigates bacterial resistance. PURE is headquartered in El Cajon, California (San Diego metropolitan area). Additional information on PURE is available at www.purebio.com.
Any statements contained in this press release that do not describe historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause our actual results to differ materially from any forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the Company’s failure to implement or otherwise achieve the benefits of its proposed business initiatives and plans; acceptance of the Company’s current and future products and services in the marketplace, including the Company’s ability to convert successful evaluations and tests into customer orders and customers continuing to place product orders as expected and to expand their use of the Company’s products; the ability of the Company to develop effective new products and receive required regulatory approvals for such products, including the required data and regulatory approvals required to use its SDC-based technology as a direct food contact processing aid in raw meat processing and to expand its use in OLR poultry processing; competitive factors; dependence upon third-party vendors, including to manufacture its products; and other risks detailed in the Company’s periodic report filings with the Securities and Exchange Commission (the SEC), including its Form 10-K for the fiscal year ended July 31, 2016, its Form 10-Q for the first quarter ended October 31, 2016 and second quarter ended January 31, 2017. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release.
|PURE Bioscience, Inc.|
|Condensed Consolidated Statements of Operations|
|Six Months Ended||Three Months Ended|
|January 31,||January 31,|
|Net product sales||$||978,000||$||362,000||$||447,000||$||176,000|
|Operating costs and expenses|
|Cost of goods sold||399,000||102,000||134,000||48,000|
|Selling, general and administrative||2,670,000||2,472,000||1,333,000||1,386,000|
|Research and development||462,000||474,000||214,000||238,000|
|Total operating costs and expenses||3,979,000||4,483,000||1,851,000||2,435,000|
|Loss from operations||(3,001,000||)||(4,121,000||)||(1,404,000||)||(2,259,000||)|
|Other income (expense)|
|Fair value of derivative liabilities in excess of proceeds||-||(1,867,000||)||-||(859,000||)|
|Change in derivative liability||300,000||(7,747,000||)||459,000||(7,790,000||)|
|Interest expense, net||(3,000||)||(5,000||)||(2,000||)||(3,000||)|
|Other income (expense), net||25,000||18,000||11,000||9,000|
|Total other income (expense)||322,000||(9,601,000||)||468,000||(8,643,000||)|
|Basic and diluted net loss per share||$||(0.04||)||$||(0.27||)||$||(0.01||)||$||(0.19||)|
Shares used in computing basic and diluted net loss per share
|PURE Bioscience, Inc.|
|Condensed Consolidated Balance Sheets|
|January 31,||July 31,|
|Cash and cash equivalents||$||3,893,000||$||5,194,000|
|Accounts receivable, net||142,000||263,000|
|Total current assets||4,639,000||6,142,000|
|Property, plant and equipment, net||568,000||440,000|
|Liabilities and stockholders' equity (deficit)|
|Total current liabilities||2,192,000||2,536,000|
|Commitments and contingencies|
|Preferred stock, $0.01 par value:|
|5,000,000 shares authorized, no shares issued||-||-|
|Common stock, $0.01 par value:|
|100,000,000 shares authorized|
62,601,037 shares issued and outstanding at January 31, 2017, and 64,823,917 shares issued and outstanding at July 31, 2016
|Additional paid-in capital||109,174,000||107,593,000|
|Total stockholders' equity (deficit)||3,903,000||5,023,000|
|Total liabilities and stockholders' equity (deficit)||$||6,108,000||$||7,562,000|
|PURE Bioscience, Inc.|
|Condensed Consolidated Statements of Cash Flows|
Adjustments to reconcile net loss to net cash used in operating activities:
|Amortization of stock issued for services||72,000||106,000|
|Fair value of derivative liabilities in excess of proceeds||-||1,867,000|
|Depreciation and amortization||134,000||103,000|
|Change in fair value of derivative liabilities||(300,000||)||7,747,000|
|Changes in operating assets and liabilities:|
|Accounts payable and accrued liabilities||(36,000||)||(33,000||)|
|Net cash used in operating activities||(2,222,000||)||(2,453,000||)|
|Investment in patents||(10,000||)||(8,000||)|
|Purchases of property, plant and equipment||(173,000||)||(154,000||)|
|Net cash used in investing activities||(183,000||)||(162,000||)|
|Net proceeds from the sale of common stock||1,104,000||8,000,000|
|Net cash provided by financing activities||1,104,000||8,000,000|
|Net decrease and increase in cash and cash equivalents||(1,301,000||)||5,385,000|
|Cash and cash equivalents at beginning of period||5,194,000||1,321,000|
|Cash and cash equivalents at end of period||$||3,893,000||$||6,706,000|
Supplemental disclosure of cash flow information
|Cash paid for taxes||$||2,000||$||2,000|
|Warrant liability removed due to settlements||$||8,000||$||-|
|Restricted stock unit cancelation||$||38,000||$||-|