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AquaBounty Technologies, Inc. Announces Results for the Year Ended December 31, 2019

MAYNARD, Mass., March 10, 2020 (GLOBE NEWSWIRE) -- AquaBounty Technologies, Inc. (NASDAQ: AQB) (“AquaBounty” or the “Company”), a land-based aquaculture company utilizing technology to enhance productivity and sustainability, announces the Company’s financial results for the year ended December 31, 2019.

Results Highlights:

Operational

  • Sylvia Wulf assumed the position of Chief Executive Officer, President, and Director;
  • The U.S. Food and Drug Administration (“FDA”) lifted its Import Alert, allowing the Company to import its AquAdvantage eggs from its hatchery in Canada to its farm in Indiana;
  • The Company’s Rollo Bay farm site received two regulatory approvals: FDA approved the farm’s hatchery building, and Environment and Climate Change Canada approved the farm’s production facility for the commercial grow-out of AquAdvantage Salmon;
  • The Company’s Indiana farm received two batches of AquAdvantage eggs and is now producing both conventional and AquAdvantage Salmon, bringing total biomass at the farm to 160 tons at year end;
  • Closed the Panama demonstration farm;
  • Received approval in China to conduct a field trial for AquAdvantage Salmon; and
  • Commenced marketing and communications activities, including qualitative and quantitative consumer research in preparation for commercialization.

Financial

  • Completed two public offerings of common shares, raising net funds of $12.4 million;
  • The Company’s Canadian subsidiary received two construction loan instalments totalling $900 thousand from the Department of Economic Development of the Province of Prince Edward Island and the Atlantic Canada Opportunities Agency; and
  • Net loss for the year increased to $13.2 million (2018: $10.4 million) with the ramp-up of production operations in Indiana and Rollo Bay, increased legal fees in support of the FDA legal challenge, and increased headcount.

Sylvia Wulf, Chief Executive Officer of AquaBounty, commented: “This was a transformative year for AquaBounty, as for the first time in the Company’s history we began to grow-out our AquAdvantage Salmon in the United States.  Production of both AquAdvantage and conventional salmon at our Indiana farm is progressing on track with conventional salmon harvest commencing in late Q2 this year and AquAdvantage Salmon harvest commencing in Q4.  We also took steps during 2019 to strengthen our balance sheet with two successful equity raises and to strengthen our management team with the additions of Dave Melbourne as Chief Commercial Officer and Angela Olsen as General Counsel.  We believe we are now well positioned to begin to execute our commercial strategy with the harvest and sale of our salmon from both our Indiana and Rollo Bay farms.”

Inquiries:

AquaBounty Technologies, Inc.
Dave Conley, Corporate Communications       +1 613 294 3078

Forward-Looking Statements:

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. All statements other than statements of historical fact contained in this press release are forward-looking statements, including statements regarding potential harvest size, initiation of a field trial and any related commercial operations in China, and the potential for and timing of the harvest and sale of our fish from our production farms. Forward-looking statements may be identified with words such as “will,” “may,” “expect,” “plan,” “anticipate,” “upcoming,” “believe,” “estimate,” or similar terminology, and the negative of these terms. Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. Forward-looking statements speak only as of the date hereof, and, except as required by law, we undertake no obligation to update or revise these forward-looking statements. For additional information regarding these and other risks faced by us, please refer to our public filings with the Securities and Exchange Commission (“SEC”), available on the Investors section of our website at www.aquabounty.com  and on the SEC’s website at www.sec.gov

AquaBounty Technologies, Inc. 
Consolidated Balance Sheets 
 
 As of
  December 31,
 2019 2018
Assets
   
Current assets:   
Cash and cash equivalents$2,798,744  $3,002,557 
Other receivables55,198  115,982 
Inventory1,232,049  76,109 
Prepaid expenses and other current assets391,162  315,969 
Total current assets4,477,153  3,510,617 
    
Property, plant and equipment, net25,065,836  23,716,768 
Right of use assets, net399,477   
Definite-lived intangible assets, net157,588  171,292 
Indefinite-lived intangible assets101,661  191,800 
Other assets32,024  80,583 
Total assets$30,233,739  $27,671,060 
    
Liabilities and stockholders’ equity   
Current liabilities:   
Accounts payable and accrued liabilities$1,462,809  $824,900 
Other current liabilities62,286  20,423 
Current debt163,155  71,613 
Total current liabilities1,688,250  916,936 
    
Long-term lease obligations352,808   
Long-term debt4,432,052  3,519,821 
Total liabilities6,473,110  4,436,757 
    
Commitments and contingencies   
    
Stockholders’ equity:   
Common stock, $0.001 par value, 50,000,000 shares authorized;   
21,635,365, (2018: 15,098,837) shares outstanding21,635  15,099 
Additional paid-in capital156,241,363  142,707,957 
Accumulated other comprehensive loss(360,160) (574,186)
Accumulated deficit(132,142,209) (118,914,567)
Total stockholders’ equity23,760,629  23,234,303 
    
Total liabilities and stockholders’ equity$30,233,739  $27,671,060 



AquaBounty Technologies, Inc.
Consolidated Statements of Operations and Comprehensive Loss
 
  Years ended December 31,
  2019 2018 2017
Revenues
     
Product Revenues$186,738  $84,518  $53,278 
      
Costs and expenses     
Production costs3,573,858  2,626,353  1,193,566 
Sales and marketing709,023  297,687  799,009 
Research and development2,359,441  3,458,564  3,371,767 
General and administrative6,723,060  4,067,710  3,921,035 
Total costs and expenses13,365,382  10,450,314  9,285,377 
      
Operating loss(13,178,644) (10,365,796) (9,232,099)
      
Other income (expense)     
Interest expense(62,988) (22,257) (21,537)
Other income (expense), net13,990  5,994  (5,011)
Total other income (expense)(48,998) (16,263) (26,548)
      
Net loss$(13,227,642) $(10,382,059) $(9,258,647)
      
Other comprehensive income (loss):     
Foreign currency translation gain (loss)214,026  (360,302) 72,388 
Total other comprehensive income (loss)214,026  (360,302) 72,388 
      
Comprehensive loss$(13,013,616) $(10,742,361) $(9,186,259)
      
Earnings per share     
Net loss$(13,227,642) $(10,382,059) $(9,258,647)
Deemed dividend$  $(1,822,873) $ 
Net loss attributable to common shareholders$(13,227,642) $(12,204,932) $(9,258,647)
      
Basic and diluted net loss per share attributable to common shareholders$(0.66) $(0.94) $(1.06)
Weighted average number of common shares -basic and diluted20,078,017  13,028,760  8,772,494 



AquaBounty Technologies, Inc.
Consolidated Statements of Cash Flows
 
 Years ended December 31,
  2019 2018 2017
 
     
Operating activities     
Net loss$(13,227,642) $(10,382,059) $(9,258,647)
Adjustment to reconcile net loss to net cash used in     
operating activities:     
Depreciation and amortization1,285,902  843,387  184,946 
Share-based compensation872,177  263,396  122,134 
Gain on disposal of equipment(12,133) (13,233) (941)
Loss on asset held for sale149,800     
Impairment loss103,116     
Other non-cash charges  (1,364)  
Changes in operating assets and liabilities:     
Other receivables65,002  56,212  (11,440)
Inventory(1,154,222) 93,956  (169,991)
Prepaid expenses and other assets59,942  289,868  (592,602)
Accounts payable, accrued liabilities and other liabilities609,311  (966,928) 625,763 
Net cash used in operating activities(11,248,747) (9,816,765) (9,100,778)
      
Investing activities     
Purchase of property, plant and equipment(2,316,809) (4,009,736) (18,893,264)
Deposits on equipment purchases(160,675) (95,001) (153,663)
Proceeds from sale of equipment15,848  23,233  941 
Net cash used in investing activities(2,461,636) (4,081,504) (19,045,986)
      
Financing activities     
Proceeds from issuance of debt900,767  771,858  256,807 
Repayment of term debt(85,802) (55,615) (35,812)
Proceeds from the issuance of common stock and warrants, net12,395,348  10,616,046  24,989,257 
Proceeds from exercise of stock options and warrants, net272,417  5,116,533  27,502 
Net cash provided by financing activities13,482,730  16,448,822  25,237,754 
      
Effect of exchange rate changes on cash and cash equivalents23,840  (54,279) 80,018 
Net change in cash and cash equivalents(203,813) 2,496,274  (2,828,992)
Cash and cash equivalents at beginning of period3,002,557  506,283  3,335,275 
Cash and cash equivalents at the end of period$2,798,744  $3,002,557  $506,283 
      
Supplemental disclosure of cash flow information and non-cash transactions:     
Interest paid in cash$62,988  $22,257  $21,537 
Property and equipment included in accounts payable and accrued liabilities$210,270  $193,378  $1,036,240 
Acquisition of equipment under debt arrangement$  $74,068