Record Q2 Sales of $4.35 million, Record Net Earnings of $0.8 million
MISSISSAUGA, Ontario, May 13, 2021 (GLOBE NEWSWIRE) -- Microbix Biosystems Inc. (TSX: MBX, OTCQB: MBXBF, Microbix®), a life sciences innovator and exporter, reports results for its second quarter and first half of fiscal 2021 ending March 31, 2021 (“Q2” and “H1”), with record sales and earnings, plus progress upon its strategic goals.
Q2 revenues were up 51% from 2020, achieving a record level of $4.35 million as Microbix continues to emphasize its sales of innovative, proprietary, and branded medical devices. Sales of its test quality assessment products (“QAPs™”) for Q2 increased 251% from the same period in fiscal 2020 (Q2 2020) to reach a record 34% of total sales. Microbix’s newest product line, viral transport medium (branded “DxTM™”) also contributed, with meaningful initial private-sector sales. Finally, sales of antigens were also strong, recovering by 7% year-over-year. All sales categories were at acceptable gross margins and together resulted in strong EBITDA, record net earnings, and positive cash flow from operations.
For the balance of fiscal 2021, further sales growth and improvements to net earnings is expected, particularly as Ontario’s initial DxTM order of $4.25 million is delivered across fiscal Q3 and Q4 of 2021.
Second Quarter Financial Results
Q2 revenue was $4,353,773, a 51% increase from Q2 2020 revenues of $2,874,496. Included were antigen revenues of $2,524,363 (Q2 2020 - $2,357,918), QAPs revenues were $1,495,088 (Q2 2020 - $425,891) for segment growth of 251%. Initial private-sector revenue from DxTM was $255,000 (Q2 2020 - nil), and royalties was $79,322 (Q2 2020 - $90,687). Microbix’s Q2 sales were most influenced by the broadening diagnostics industry uptake of Microbix’s COVID-19 related QAPs, especially the swab-formatted PROCEEDx™FLOQ® and REDx™FLOQ® QAPs, and continued recovery in antigen sales.
Q2 gross margin was 60%, up from 46% in Q2 2020, due to a greater proportion of sales of QAPs, new VTM sales, the effects of antigen product sales mix, and improving bioreactor antigen margins.
Operating expenses in Q2 increased by 17% relative to Q2 2020, primarily due to the impact of the fluctuations in foreign currencies in Q2 2021 vs. Q2 2020. Overall, greater sales and more available gross margin dollars during Q2 led to an operating income and net income of $807,463 versus an operating and net loss of $219,030 in Q2 2020. Cash provided by operating activities was $981,648, compared to cash used in operations of $777,851 in Q2 2020, with the increase coming primarily from a year-over-year improvement in net income of over $1 million.
First Half Financial Results
H1 revenue was $7,511,432, a 53% increase from prior year (H1 2020) revenue of $4,920,844. Included were antigen product revenues of $4,662,192 (H1 2020 - $4,304,377), a recovery of 8%. QAPs revenues were $2,457,509, an increase of 444% from H1 2020 sales of $452,005. Finally, DxTM was $255,000 (H1 2020 - nil) and royalties were $136,731 (H1 2020 - $164,462). H1 sales were most influenced by the uptake of Microbix’s COVID-19 related QAPs, especially PROCEEDx™FLOQ® and REDx™FLOQ®, followed by the start of what is expected to become a broad-based recovery in antigen sales.
Gross margin in H1 was 58%, up from 48% in H1 2020, due to significant increase in higher margin QAPs sales and changes in Antigens product mix & yields. H1 operating expenses increased by 8% from 2020, primarily due year-over-year incremental foreign exchange losses. Stronger sales and gross margins YTD led to a net profit of $938,282 versus a net loss of $804,295 in H1 2020. Cash provided by operations (“CFO”) was $1,168,450, compared to cash used of $540,059 in H1 2020.
At the end of Q2, Microbix’s current ratio (current assets divided by current liabilities) was 1.86 and its debt to equity ratio (total debt over shareholders’ equity) was 1.19.
As at and for the quarter ended
March 31, 2021
March 31, 2020
March 31, 2021
March 31, 2020
Operating Income (Loss) for the period
Net Income (Loss) and Comprehensive Income (Loss) for the period
Cash Provided (Used) by Operating Activities
March 31, 2021
September 30, 2020
Total current assets
Total current liabilities
Total shareholders' equity
Debt to equity ratio
For the balance of fiscal 2021, Microbix will work to building sales across all of its three revenue-generating business lines, continue improving percentage gross margins and driving its bottom-line results. If Microbix achieves its budget targets, the company will generate meaningful net earnings for fiscal 2021. Additionally, work continues upon securing a partnership to advance its Kinlytic® urokinase project.
Adelaide Capital will host a live webinar with management, on Monday, May 17th at 11am ET. Please register here: https://us02web.zoom.us/webinar/register/WN_o-jH4kZiRsOjHmQPdihUrg. It will also be live-streamed to YouTube at: https://www.youtube.com/channel/UC7Jpt_DWjF1qSCzfKlpLMWw. A replay of the webinar will also be made available on Adelaide Capital’s YouTube channel.
About Microbix Biosystems
Microbix develops proprietary biological technology solutions for human health and well-being, with about 90 skilled employees and sales growing from a base of over $1 million per month. It makes a wide range of critical biological materials for the global diagnostics industry, notably antigens for immunoassays and its laboratory quality assessment products (QAPs™) that support clinical lab proficiency testing, enable assay development and validation, or help ensure the quality of clinical diagnostic workflows. Microbix antigens enable the antibody tests of over 100 international diagnostics companies, while its QAPs are sold to clinical laboratory accreditation organizations, diagnostics companies, and clinical laboratories. Microbix QAPs are now available in over 30 countries, distributed by 1WA (Oneworld Accuracy Inc.), Alpha-Tec Systems, Inc., Diagnostic International Distribution SpA., Labquality Oy, The Medical Supply Company of Ireland, R-Biopharm AG, and Seegene Canada Inc. Microbix is ISO 9001 and 13485 accredited, U.S. FDA registered, Australian TGA registered, Health Canada establishment licensed, and provides CE marked products.
Microbix also applies its biological expertise and infrastructure to develop other proprietary products and technologies, most notably viral transport medium (DxTM™) to stabilize patient samples for lab-based molecular diagnostic testing and Kinlytic® urokinase, a biologic thrombolytic drug used to treat blood clots. Microbix is traded on the TSX and OTCQB, and headquartered in Mississauga, Ontario, Canada.
This news release includes “forward-looking information,” as such term is defined in applicable securities laws. Forward-looking information includes, without limitation, discussion of financial results or the outlook for the business, risks associated with its financial results and stability, its current or future products, development projects such as those referenced herein, sales to foreign jurisdictions, engineering and construction, production (including control over costs, quality, quantity and timeliness of delivery), foreign currency and exchange rates, maintaining adequate working capital and raising further capital on acceptable terms or at all, and other similar statements concerning anticipated future events, conditions or results that are not historical facts. These statements reflect management’s current estimates, beliefs, intentions and expectations; they are not guarantees of future performance. The Company cautions that all forward looking information is inherently uncertain and that actual performance may be affected by a number of material factors, many of which are beyond the Company’s control. Accordingly, actual future events, conditions and results may differ materially from the estimates, beliefs, intentions and expectations expressed or implied in the forward-looking information. All statements are made as of the date of this news release and represent the Company’s judgement as of the date of this new release, and the Company is under no obligation to update or alter any forward-looking information.
Please visit www.microbix.com or www.sedar.com for recent Microbix filings.
For further information, please contact:
Cameron Groome, CEO
Jim Currie, CFO
Deborah Honig, Investor Relations
Copyright © 2021 Microbix Biosystems Inc.
Microbix®, DxTM™, Kinlytic®, and QAPs™ are trademarks of the Company
PROCEEDx™FLOQ® and REDx™FLOQ® are trademarks of the Company in collaboration with Copan Italia S.p.A.