Calyxt reports 1st quarter financial results
Date:05-09-2019
- Calyno High Oleic Soybean Oil is the first ever gene-edited food product to successfully undergo review by the USDA and FDA and be commercialized in the U.S.
- Calyno High Oleic Soybean Oil is now available from one of the world's largest broadline foodservice distributors
- Sold out of seed and 3x acre growth, with 55,000 Calyxt soybean acres contracted for the 2019 growing season
- Cash and cash equivalents of $85.7M at March 31, 2019
- 2019 seed deliveries began in second quarter, cash receipts of $1.8M
- expected over next 90 days
Calyxt, Inc. (NASDAQ: CLXT), a healthy food ingredient company, today announced its results for the first quarter ended March 31, 2019.
“In the first quarter of 2019, we achieved a monumental milestone for Calyxt with the successful commercial launch of Calyno oil. We are thrilled to see our High Oleic Soybean Oil either met or exceeded the performance and quality standards of the commercially available oils for qualities including fry life, trans-fat content, saturated fat content and flavor transfer. Following the initial commercial sale, we have identified and vetted a series of food customer opportunities and we are excited to announce that as of late April Calyno oil is available from one of the world's largest broadline foodservice distributors” said Jim Blome, CEO of Calyxt. “On the farmer side, we are sold out of seed for the 2019 growing season and have tripled our acres from 2018 – we have partnered with over 150 selected growers who have contracted over 55,000 Calyxt soybean acres.”
Regulatory
As previously announced, Calyxt completed a consultation with the Food and Drug Administration (FDA) for its High Oleic Soybean. After review, FDA had no further questions concerning human food ingredients or animal food derived from our High Oleic Soybean. Calyno oil is the first gene-edited food product to undergo such review and be commercialized in the U.S.
High Oleic Soybean
Completed the first sales of Calyxt High Oleic Soybean Oil, Calyno, in the foodservice channel. We are focused on selling this oil for frying applications based on its extended fry life, flavor performance, and heart-healthy qualities. Within the foodservice channel we are focused on certain categories of commercial restaurants and usage in other foodservice segments including Business & Industry, Healthcare and Education.
As of late April, Calyno oil is available from one of the world's largest broadline foodservice distributors providing a growth opportunity for the distribution and integration of our soybean oil in the foodservice business nationwide. We are vetting further engagements with food companies to focus on high volume sales based on our growing acreage.
Completed the first sales of High Oleic Soybean Meal as a premium feed ingredient for livestock.
Cooperation with Agtegra continues to scale as we leverage their resources to contract acreage, for agronomic support, grain storage, and for rail shipping.
2019 acreage contracting complete. We are sold out of seed for the 2019 growing season and have contracted over 55,000 acres, more than triple our 2018 acreage. These contracts are with more than 150 growers. Our grower retention rate is over 73 percent.
Product Candidate Pipeline
Development of High Fiber Wheat product candidate. Preliminary results showed our High Fiber Wheat product candidate produced white flour with at least three times more dietary fiber than standard white wheat flour. This product candidate is currently in Phase II of our development process and on track for commercialization as early as 2022. Our High Fiber Wheat product has been determined to be non-regulated by the U.S. Department of Agriculture (USDA).
Additional varieties of our High Oleic Soybean are in Phase III of our development process. We expect these varieties will expand our growing zones and will be commercialized in 2020 and 2021.
Financial Highlights
Cash, cash equivalents and restricted cash were $85.7 million at March 31, 2019. We intend to continue to manage the use of cash and expect to have sufficient cash to fund the business into early 2021.
Our cash spend for 2019 is estimated at between $3 million and $3.5 million per month based on the increase in acreage contracted for the 2019 season and will be focused in these areas:
- Supporting our product pipeline, including development of additional varieties and traits for soybeans, high fiber wheat and alfalfa, as well as continuing to build our strong intellectual property portfolio;
- Continuing to drive the commercialization of our High Oleic Soybean products including our Calyno oil and High Oleic Soybean meal, which includes spending for sales and marketing support, product samples, and costs associated with agricultural activities including seed production, grain purchases, and processing and distribution; and
- Strengthening our organization, including hiring talented personnel, developing our IT systems, maintaining public company reporting and compliance and refining internal controls.
For the three months ended March 31, 2019, we incurred losses from operations of $7.4 million and used net cash in operating activities of $9.3 million.
For the three months ended March 31, 2018, we incurred losses from operations of $4.4 million and used net cash in operating activities of $6.6 million.
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