? 2023 marked by Ceapro's achievement of key milestones and progress toward its next phase of growth
? R&D activities focused on advancement of avenanthramide Phase 1-2a clinical study and the processing of yeast beta glucan along with the building of pilot scale units for PGX Technology
? Sales impacted (decreased by 49% from $18.8M in 2022 to $9.6M in 2023) due to re-organization associated with the spin-off of the consumer division of one major customer
? Announced merger of equals with Aeterna Zentaris to create a diversified biopharmaceutical company; expected to close in the second quarter of 2024, subject to the closing conditions
EDMONTON, Alberta, April 29, 2024 (GLOBE NEWSWIRE) -- Ceapro Inc. (TSX-V: CZO, OTCQX: CRPOF) ("Ceapro" or the "Company"), a growth-stage biotechnology company focused on the development and commercialization of active ingredients for healthcare and cosmetic industries, today announced operational highlights and financial results for the fourth quarter and full year ended December 31, 2023.
"While the base business was significantly impacted during 2023 due to various economic factors and organizational changes within one major customer, we expect renewed growth with our active ingredients base business and will continue to focus our efforts in expanding our business model towards nutraceutical and pharmaceutical sectors. We are very pleased with progress made in the development of new products and technologies such as the ongoing Phase 1-2a clinical trial with avenanthramides and the very well-advanced 50L scale-up of the PGX Technology which will enable the development and production of yeast beta glucan as an immune modulator. Lastly, with our recent announcement of the merger of equals with Aeterna Zentaris, we believe we are, more than ever, positioned to significantly propel Ceapro into its next phase of growth and unlock value as a biopharmaceutical company," stated Gilles Gagnon, M.Sc., MBA, President and CEO of Ceapro.
2023 Corporate and Operational Highlights
Focus has been on development of Avenanthramides, scale-up of the PGX Technology and development of PGX-processed products.
Avenanthramides:
Clinical
Formulation & Analytics
Pre-Clinical
Avenanthramides Malted Technology
Technology:
PGX
PGX-Processed Products
Yeast Beta Glucan (YBG):
Whey Proteins:
New Product - Chewable Oat Beta Glucan (OBG):
Corporate
Subsequent to Year End
Financial Highlights for the Fourth Quarter and Full Year 2023 Ended December 31, 2023
"We expect to continue leveraging our base business for the development of new products and technologies and subject to the closing and successful integration with Aeterna Zentaris, we expect to benefit from complementary competencies, additional financial resources and expanded portfolio with revenue generation product to accelerate the completion of our prioritized projects while continuing to assess different market initiatives to bring new business and unlock value in the near and long term," concluded Mr. Gagnon.
CEAPRO INC. | |||
Consolidated Balance Sheets | |||
December 31, | December 31, | ||
2023 | 2022 | ||
$ | $ | ||
ASSETS | |||
Current Assets | |||
Cash | 8,843,742 | 13,810,998 | |
Trade receivables | 167,295 | 2,820,300 | |
Other receivables | 216,763 | 64,808 | |
Inventories (note 3) | 5,308,987 | 3,757,040 | |
Prepaid expenses and deposits | 310,191 | 135,133 | |
Total Current Assets | 14,846,978 | 20,588,279 | |
Non-Current Assets | |||
Restricted cash | 10,000 | - | |
Investment tax credits receivable | 984,200 | 854,895 | |
Deposits | 74,369 | 76,954 | |
Licences (note 4) | 9,625 | 12,588 | |
Property and equipment (note 5) | 15,421,884 | 16,201,755 | |
Deferred tax assets (note 12 (b)) | 98,778 | - | |
Total Non-Current Assets | 16,598,856 | 17,146,192 | |
TOTAL ASSETS | 31,445,834 | 37,734,471 | |
LIABILITIES AND EQUITY | |||
Current Liabilities | |||
Accounts payable and accrued liabilities | 1,342,156 | 1,730,377 | |
Current portion of lease liabilities (note 6) | 396,232 | 370,460 | |
Total Current Liabilities | 1,738,388 | 2,100,837 | |
Non-Current Liabilities | |||
Long-term lease liabilities (note 6) | 1,852,345 | 2,248,577 | |
Deferred tax liabilities (note 12 (b)) | - | 1,095,968 | |
Total Non-Current Liabilities | 1,852,345 | 3,344,545 | |
TOTAL LIABILITIES | 3,590,733 | 5,445,382 | |
Equity | |||
Share capital (note 7 (b)) | 16,721,867 | 16,694,625 | |
Contributed surplus | 4,963,067 | 4,714,404 | |
Retained earnings | 6,170,167 | 10,880,060 | |
Total Equity | 27,855,101 | 32,289,089 | |
TOTAL LIABILITIES AND EQUITY | 31,445,834 | 37,734,471 | |
CEAPRO INC. | |||||
Consolidated Statements of Net (Loss) Income and Comprehensive (Loss) Income | |||||
2023 | 2022 | ||||
Years Ended December 31, | $ | $ | |||
Revenue (note 14) | 9,633,400 | 18,839,607 | |||
Cost of goods sold | 5,677,211 | 7,821,908 | |||
Gross margin | 3,956,189 | 11,017,699 | |||
Research and product development | 2,751,473 | 1,788,666 | |||
General and administration | 7,419,593 | 3,700,498 | |||
Sales and marketing | 40,484 | 29,558 | |||
Finance costs (note 9) | 183,130 | 184,967 | |||
(Loss) income from operations | (6,438,491 | ) | 5,314,010 | ||
Other income (note 10) | (533,852 | ) | (462,905 | ) | |
(Loss) income before income taxes | (5,904,639 | ) | 5,776,915 | ||
Deferred tax (benefit) expense (note 12 (a)) | (1,194,746 | ) | 1,378,817 | ||
Net (loss) income and comprehensive (loss) income for the year | (4,709,893 | ) | 4,398,098 | ||
Net (loss) income per common share (note 19): | |||||
Basic | (0.06 | ) | 0.06 | ||
Diluted | (0.06 | ) | 0.06 | ||
Weighted average number of common shares outstanding (note 19): | |||||
Basic | 78,272,574 | 77,961,714 | |||
Diluted | 78,272,574 | 78,582,083 | |||
CEAPRO INC. | ||||
Consolidated Statements of Cash Flows | ||||
2023 | 2022 | |||
Year Ended December 31, | $ | $ | ||
OPERATING ACTIVITIES | ||||
Net (loss) income for the year | (4,709,893 | ) | 4,398,098 | |
Adjustments for items not involving cash | ||||
Finance costs | 128,130 | 129,967 | ||
Depreciation and amortization | 1,946,776 | 1,911,278 | ||
Deferred income tax (benefit) expense | (1,194,746 | ) | 1,378,817 | |
Share-based payments | 259,005 | 89,648 | ||
(3,570,728 | ) | 7,907,808 | ||
CHANGES IN NON-CASH WORKING CAPITAL ITEMS | ||||
Trade receivables | 2,653,005 | (727,458 | ) | |
Other receivables | (151,955 | ) | (18,958 | ) |
Investment tax credits receivable | (129,305 | ) | (88,266 | ) |
Inventories | (1,551,947 | ) | (1,432,955 | ) |
Prepaid expenses and deposits | (172,473 | ) | 30,371 | |
Accounts payable and accrued liabilities relating to operating activities | (571,430 | ) | 1,096,074 | |
75,895 | (1,141,192 | ) | ||
Net (loss) income for the year adjusted for non-cash and working capital items | (3,494,833 | ) | 6,766,616 | |
Interest paid | (128,130 | ) | (129,967 | ) |
CASH (USED IN) GENERATED FROM OPERATIONS | (3,622,963 | ) | 6,636,649 | |
INVESTING ACTIVITIES | ||||
Purchase of property and equipment | (980,733 | ) | (388,821 | ) |
CASH USED IN INVESTING ACTIVITIES | (980,733 | ) | (388,821 | ) |
FINANCING ACTIVITIES | ||||
Stock options exercised | 16,900 | 81,290 | ||
Increase in restricted cash | (10,000 | ) | - | |
Repayment of lease liabilities | (370,460 | ) | (299,109 | ) |
CASH USED IN FINANCING ACTIVITIES | (363,560 | ) | (217,819 | ) |
(Decrease) increase in cash | (4,967,256 | ) | 6,030,009 | |
Cash at beginning of the year | 13,810,998 | 7,780,989 | ||
Cash at end of the year | 8,843,742 | 13,810,998 | ||
The complete financial statements are available for review on SEDAR at https://sedar.com/Ceapro and on the Company's website at www.ceapro.com.
About Ceapro Inc.
Ceapro Inc. is a Canadian biotechnology company involved in the development of proprietary extraction technology and the application of this technology to the production of extracts and "active ingredients" from oats and other renewable plant resources. Ceapro adds further value to its extracts by supporting their use in cosmeceutical, nutraceutical, and therapeutics products for humans and animals. The Company has a broad range of expertise in natural product chemistry, microbiology, biochemistry, immunology and process engineering. These skills merge in the fields of active ingredients, biopharmaceuticals and drug-delivery solutions. For more information on Ceapro, please visit the Company's website at www.ceapro.com.
Forward-looking information
The information in this news release has been prepared as at April 24, 2024. Certain statements made herein, including statements relating to matters that are not historical facts and statements of the Company's beliefs, intentions and expectations about developments, results and events which will or may occur in the future, constitute "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information relates to future events or future performance, reflect current expectations or beliefs regarding future events and is typically identified by words such as "aim", "anticipate", "assume", "believe", "continue", "could", "expect", "forecast", "future", "intend", "maintain", "may", "outlook", "plan", "potential", "project", "synergies", "will", and similar expressions suggesting future outcomes or statements regarding an outlook. Forward-looking information includes, but is not limited to, statements with respect to the Arrangement, including the expected timing and outcome of the Meeting, closing and various other steps to be completed in connection with the Arrangement, and other statements that are not historical facts, including the Company's ability to obtain regulatory approvals, including those from health authorities, and to develop, introduce, and implement new products as well as enhancements for existing products that meet customer needs and product requirements in a timely manner.
Forward-looking information is based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performance or achievements of the Company or the combined company to be materially different from future results, performance or achievements expressed or implied by such information. There can be no assurance that such information will prove to be accurate. Such information being based on numerous assumptions.
Readers are cautioned not to place undue reliance on forward-looking information, which speak only as of the date made. For a more detailed discussion of such risks and other factors that may affect Ceapro's ability to achieve the expectations set forth in the forward-looking information contained in this news release, see Ceapro's management information circular dated February 9, 2024, MD&A filed under Ceapro's profile on SEDAR+ at www.sedarplus.ca, as well as Ceapro's other filings with the Canadian securities regulators. Other than as required by law, the Company does not intend, and does not assume any obligation to, update the forward-looking information in this news release.
For more information contact:
Issuer:
Gilles R. Gagnon, M.Sc., MBA
President & CEO
T: 780-421-4555
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release
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