Amyris, Inc. Reports First Quarter 2020 Results
EMERYVILLE, Calif., May 8, 2020 /PRNewswire/ -- Amyris, Inc. (Nasdaq: AMRS), a leading synthetic biotechnology company in Clean Health and Beauty markets through its consumer brands and a top supplier of sustainable and natural ingredients, today announced financial results for its first quarter ended March 31, 2020.
Keeping our people, partners and communities safe and healthy while benefiting from strong product demand has been our number one priority during these unprecedented times with COVID-19.
Management Comments
"COVID-19 has dominated all of our lives with a significant impact both from a health and economic perspective. Keeping our people, our partners and our communities safe and healthy while delivering on very strong product demand from consumers has been our number one priority. This meant that we had to adjust our ways of working across our supply chain, innovation center and offices. Our people have been amazing, and we have continued to deliver on our commitments to our customers," said John Melo, President and Chief Executive Officer. "We play a critical role in helping those who have been impacted by the pandemic. This includes rapidly launching a new hand sanitizer of which we have donated over 20,000 units to frontline healthcare workers. Also, we supply key ingredients for household cleaning and personal care products and are exploring how our science can be further utilized to fight the virus."
Continued Melo, "We are pleased with our first quarter results for what is typically our lowest sales quarter of the year due to seasonality. We have seen limited impact to our business performance from COVID-19. During the month of April we delivered our best single month of consumer product sales. We are experiencing significant demand for our ingredients into cleaning products and personal care products. We are encouraged by the growth in our top and bottom-line performance and see continued opportunity with our strong portfolio of branded consumer products and functional ingredients. Our focus on higher margin product sales and reducing unit costs by adapting our supply chain are delivering strong results. At our current performance we expect to achieve positive operating cash performance by the fourth quarter of this year. We remain committed to our current guidance and will update our view on the year as we get more visibility."
Q1 Financial Highlights
-- Performance was in line with expectations with Sales Revenue of $29
million up 103% versus the prior year quarter with strong growth seen in
Consumer & Ingredients product sales
-- Gross Margin as a percentage of sales improved to 63% which compares to
-33% in Q1 2019 and 56% for the full year 2019. Year-over-year margin
growth delivered a $23 million improvement and was driven by improved
sales mix from higher consumer brand sales and lower unit cost
-- Adjusted EBITDA of -$27 million improved $19 million versus the same
quarter last year driven by the aforementioned margin improvements
-- GAAP Net Income of -$87 million was down $23 million. EBITDA
improvements of $19 million were offset by non-cash debt related
adjustments of $37 million.
-- Adjusted Net Income of -$44 million improved $15 million versus prior
year.
-- Diluted EPS improved $0.26 or 32% to -$0.56
-- Adjusted Diluted EPS improved $0.47 or 63% to -$0.28 per share
-- Debt principal was reduced by $88 million or 30% during the quarter from
$297 million to $209 million
Strategic Priorities
At the start of 2020 we set out four strategic priorities to focus our execution on accelerated growth and a clear path to profitability and sustained cash generation:
-- High growth consumer brands: build on our Clean Beauty market leadership
and double sales year over year. Extend offering of clean and safe
ingredients and products
-- Scientific and commercial collaboration: Execute on R&D collaboration
programs to scale 3-4 new molecules yearly. Establish market leadership
in sustainable Health and Wellness markets
-- Supply chain optimization: Deliver lower unit costs targeting gross
margins >60 of sales. Drive agile and robust supply network to support
sales growth
-- Improved balance sheet, earnings and cash flow: Reduced balance sheet
leverage. Be fully funded to deliver growth. Deliver on path to
sustained cash generation from operational performance
During the first quarter we made strong progress on each of our strategic priorities:
-- Consumer brands sales more than doubled; mostly driven by Biossance, our
Clean Beauty brand
-- Launched a new Pipette branded hand sanitizer product responding to
COVID-19 needs. We donated first production batches to front-line
healthcare workers
-- Collaboration revenue grew by more than 150%
-- Gross Margin grew to 63%
-- Expanded supply and fulfillment network to respond to continued consumer
brand growth
-- Reduced and simplified debt. Delivered much improved earnings both in
absolute terms and per diluted share
Q1 2020 Results
Variance $ and Variance % in the following tables and comments may not foot due to rounding
$ Millions except EPS
Quarter 1 2020 2019 Variance $ Variance %
Sales Revenue 29 14 15 103%
Gross Margin 63% (33%)
+9650bps
Net Income (87) (64) (23) (36%)
Adj. Net Income (44) (59) 15 25%
EBITDA (30) (49) 18 38%
Adj. EBITDA (27) (45) 19 41%
Diluted EPS (0.56) (0.82) 0.26 32%
Adj. Diluted EPS (0.28) (0.76) 0.47 63%
-- Sales Revenue improved by 103% due to a 92% improvement in Consumer &
Ingredients and 158% growth in Collaboration & Grants
-- Gross Margin as a percentage of sales improved to 63%, and delivered a
$23 million improvement driven by a combination of higher margins from
consumer brand sales and lower unit costs in ingredients
-- GAAP Net Income of -$87 million was down $23 million impacted by
non-cash adjustments and fair value assessments in debt instruments of
$37 million. Adjusted Net Income of -$44 million improved $15 million
versus prior year driven by operational improvements from sales mix and
lower unit costs
-- Operating expenses of $44 million were up 5% due to investments in
marketing and sales, partly offset by lower R&D expense
-- Adjusted EBITDA of -$27 million improved $19 million versus the same
quarter last year primarily driven by margin improvements
-- Adjusted Diluted EPS improved $0.47 or 63% to -$0.28 per share
Q1 2020 Category Sales Revenue
Variance $ and Variance % in the following tables and comments may not foot due to rounding
Quarter 1 2020 $ Millions 2019 $ Millions Variance $ Variance %
---
Vol/
Mix
Price
Other Total
---
Consumer &
Ingredients 23 12 11 0 11 92%
---
Collaboration &
Grants 6 2 4 4 158%
---
Total Sales 29 14 11 0 4 15 103%
---
Note: Consumer & Ingredients
sales is the total of
Renewable Products and
Licenses and Royalties
-- Consumer & Ingredients (C&I) sales grew 92% year over year (price +3%,
volume/mix +89%) with growth seen in both direct-to-consumer branded
products (+233%) and business-to-business ingredients (+50%). Excluding
a $4 million one-off value share C&I sales were up 56%
-- Collaboration & Grants were up 158% year over year due to higher revenue
from several strategic partnership programs
Full Year 2020 Outlook
Our current Sales Revenue guidance is maintained albeit that COVID-19 presents uncertainties to which we do not have full visibility.
Full year Sales Revenue is expected to grow approximately 44% versus 2019 GAAP sales of $153 million. 2020 recurring sales are expected to grow approximately 80% versus 2019 recurring sales of $104 million.
Full Year 2019 2020 Phasing
$ Millions Growth %
---
H1
H2
---
Total GAAP Sales 153 ~44% 30% 70%
---
Total Recurring Sales 104 ~80% 35% 65%
---
Gross Margin is expected to operate at greater than 60% of sales due to improved sales mix and lower unit costs. Based on sales revenue guidance, Adjusted EBITDA is expected to turn positive during Q4 of this year.
FINANCIAL RESULTS AND NON-GAAP INFORMATION
To supplement our financial results and guidance presented on a GAAP basis, we use non-GAAP measures that we believe are helpful in understanding our results. These non-GAAP measures are among the factors management uses in planning and forecasting future periods. These non-GAAP financial measures also facilitate management's internal comparisons to Amyris's historical performance as well as comparisons to the operating results of other companies. Management believes these non-GAAP financial measures are useful to investors because they allow for greater transparency into the indicators used by management to understand, manage, and evaluate our business and make operating decisions. Our non-GAAP financial measures include the following:
Non-GAAP net income (loss) is calculated as GAAP net income/loss excluding stock-based compensation expense, gains or losses from change in fair value of debt, gains and losses from changes in the fair value of derivatives, losses on debt extinguishment, and losses allocated to participating securities.
Adjusted diluted EPS is calculated by dividing Non-GAAP net income (loss) by the weighted average shares, basic and diluted outstanding for the period.
Non-GAAP Gross Margin (Gross Margin) is calculated as GAAP revenues divided by GAAP cost of products sold excluding excess capacity, depreciation and amortization and other costs/provisions.
EBITDA is calculated as GAAP net loss less losses allocated to participating securities, interest, tax provision, depreciation and amortization.
Adjusted EBITDA is calculated as EBITDA less stock-based compensation expense, gains or losses from change in fair value of debt, gains and losses from changes in the fair value of derivatives, losses on debt extinguishment and other expense, net.
Non-GAAP financial information is not prepared under a comprehensive set of accounting rules, and therefore, should only be read in conjunction with financial information reported under U.S. GAAP in order to understand Amyris's operating performance. A reconciliation of the non-GAAP financial measures presented in this release to the most directly comparable GAAP financial measure, is provided in the tables attached to this press release.
Conference Call
Amyris will host its first quarter 2020 conference call today May 8, 2020 at 9:00 am ET (6:00 am PT) to discuss its financial results. Those who wish to listen to the conference call should dial into (888) 390-3967 (U.S. and International) and ask to be joined to the Amyris, Inc. call. A live webcast of the call will be available online on the Amyris website. To listen via live webcast, please visit: http://investors.amyris.com.
If you are unable to listen to the live call, the webcast will be archived on the Company's website. A replay of the webcast will be available on the Investor Relations section of the company's website approximately two hours after the conclusion of the call. Additional information on Amyris' first quarter 2020 results can also be found on the Company's website.
About Amyris
Amyris (Nasdaq: AMRS) is a science and technology leader in the research, development and production of sustainable ingredients for the Clean Health & Beauty and Flavors & Fragrances markets. Amyris uses an impressive array of exclusive technologies, including state-of-the-art machine learning, robotics and artificial intelligence. Our ingredients are included in over 3,000 products from the world's top brands, reaching more than 200 million consumers. Amyris is proud to own three consumer brands - all built around its No Compromise® promise of clean ingredients: Biossance(TM) clean beauty skincare, Pipette(TM) clean baby skincare and Purecane(TM), a zero-calorie sweetener naturally derived from sugarcane. For more information, please visit www.amyris.com.
Forward-Looking Statements
This release contains forward-looking statements, and any statements other than statements of historical fact could be deemed to be forward-looking statements. These forward-looking statements include, among other things, statements regarding future events, such as expected revenue, including product and royalty revenues, recurring revenue, EBITDA, gross profit and operating expenses in 2020 and beyond, including related growth rates, anticipated growth for Amyris's Clean Beauty business, expected production volume, delivery and cost reduction in 2020, and expectations regarding Amyris's financial and operational results and ability to achieve its business plan in 2020 and beyond, including the potential utilization of its science in remedies against COVID-19. These statements are based on management's current expectations and actual results and future events may differ materially due to risks and uncertainties, including risks related to Amyris's liquidity and ability to fund operating and capital expenses, risks related to its financing activities, risks related to potential delays or failures in development, production and commercialization of products, risks related to Amyris's reliance on third parties, and other risks detailed from time to time in filings Amyris makes with the Securities and Exchange Commission, including Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Amyris disclaims any obligation to update information contained in these forward-looking statements, whether as a result of new information, future events, or otherwise.
Amyris, the Amyris logo, No Compromise, Biossance, Pipette, and Purecane are trademarks or registered trademarks of Amyris, Inc. in the U.S. and/or other countries.
Financial Tables Follow
Amyris, Inc.
CONDENSED CONSOLIDATED
BALANCE SHEETS
(Unaudited)
(In thousands, except shares
and per share amounts)
March 31, 2020
December 31, 2019
---
Assets
Current assets:
Cash and cash equivalents $2,607 $270
Restricted cash 399 469
Accounts receivable, net 18,426 16,322
Accounts receivable -
related party, net 6,769 3,868
Contract assets 9,355 8,485
Inventories 31,063 27,770
Deferred cost of products
sold -related party 3,535 3,677
Prepaid expenses and other
current assets 12,823 12,750
Total current assets 84,977 73,611
Property, plant and
equipment, net 26,912 28,930
Contract assets, noncurrent
-related party 1,203 1,203
Deferred cost of products
sold, noncurrent -related
party 12,815 12,815
Restricted cash, noncurrent 960 960
Recoverable taxes from
Brazilian government
entities 6,726 7,676
Right-of-use assets under
financing leases, net 12,143 12,863
Right-of-use assets under
operating leases, net 12,391 13,203
Other assets 9,180 9,705
Total assets $167,307 $160,966
Liabilities, Mezzanine
Equity and Stockholders'
Deficit
Current liabilities:
Accounts payable $48,936 $51,234
Accrued and other current
liabilities 40,943 36,655
Financing lease liabilities 3,510 3,465
Operating lease liabilities 4,747 4,625
Contract liabilities 3,226 1,353
Debt, current portion 64,453 45,313
Related party debt, current
portion 14,175 18,492
Total current liabilities 179,990 161,137
Long-term debt, net of
current portion 24,153 48,452
Related party debt, net of
current portion 97,227 149,515
Financing lease liabilities,
net of current portion 3,255 4,166
Operating lease liabilities,
net of current portion 13,728 15,037
Derivative liabilities 7,748 9,803
Other noncurrent liabilities 17,335 23,024
Total liabilities 343,436 411,134
Commitments and
contingencies
Mezzanine equity:
Contingently redeemable
common stock 5,000 5,000
Stockholders' deficit:
Preferred stock
Common stock 16 12
Additional paid-in capital 1,708,096 1,543,668
Accumulated other
comprehensive loss (46,353) (43,804)
Accumulated deficit (1,843,497) (1,755,653)
Total Amyris, Inc.
stockholders' deficit (181,738) (255,777)
Noncontrolling interest 609 609
Total stockholders' deficit (181,129) (255,168)
Total liabilities, mezzanine
equity and stockholders'
deficit $167,307 $160,966
Amyris, Inc.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
(In thousands, except shares
and per share amounts) 2020 2019
---
Revenue:
Renewable products (includes
related party revenue of
$49 and $2, respectively) $17,854 $11,884
Licenses and royalties
(includes related party
revenue of $3,750 and
($380), respectively) 5,161 118
Grants and collaborations
(includes related party
revenue of $3,018 and $396,
respectively) 6,115 2,372
Total revenue (includes
related party revenue of
$6,817 and $18,
respectively) 29,130 14,374
Cost and operating expenses:
Cost of products sold 11,790 17,707
Research and development(1) 17,126 17,839
Sales, general and
administrative(1) 32,014 28,253
Total cost and operating
expenses 60,930 63,799
Loss from operations (31,800) (49,425)
Other income (expense):
Interest expense (15,002) (12,534)
Gain (loss) from change in
fair value of derivative
instruments 3,282 (2,039)
Loss from change in fair
value of debt (16,503) (2,130)
Loss upon extinguishment of
debt (27,319)
Other expense, net (411) (115)
Total other expense, net (55,953) (16,818)
Loss before income taxes (87,753) (66,243)
Provision for income taxes (91)
Net loss attributable to
Amyris, Inc. (87,844) (66,243)
Less loss allocated to
participating securities 1,087 2,430
Net loss attributable to
Amyris, Inc. common
stockholders $(86,757) $(63,813)
Loss per share attributable
to common stockholders,
basic and diluted $(0.56) $(0.82)
Weighted-average shares of
common stock outstanding
used in computing loss per
share of common stock,
basic and diluted 155,065,635 77,512,059
(1)Includes stock-based
compensation expense as
follows:
Research and development $1,065 $663
Sales, general and
administrative 2,439 2,789
$3,504 $3,452
Amyris, Inc.
RECONCILIATION OF GAAP TO NON-
GAAP FINANCIAL INFORMATION
(Unaudited)
Three Months Ended March 31,
(In thousands, except per
share data) 2020 2019
---
Net loss attributable to
Amyris, Inc. common
stockholders (GAAP) $(86,757) $(63,813)
Non-GAAP adjustments:
Stock-based compensation
expense 3,504 3,452
(Gain) loss from change in
fair value of derivative
instruments (3,282) 2,039
Loss from change in fair value
of debt 16,503 2,130
Loss upon extinguishment of
debt 27,319
Loss allocated to
participating securities (1,087) (2,430)
Net loss attributable to
Amyris, Inc. common
stockholders (non-GAAP) $(43,800) $(58,622)
Weighted-average shares
outstanding
Shares outstanding, basic and
diluted 155,065,635 77,512,059
Net loss per share
attributable to Amyris, Inc.
common stockholders -Basic
and Diluted (GAAP) $(0.56) $(0.82)
Non-GAAP adjustments:
Stock-based compensation
expense 0.02 0.04
(Gain) loss from change in
fair value of derivative
instruments (0.02) 0.03
Loss from change in fair value
of debt 0.11 0.03
Loss upon extinguishment of
debt 0.18
Loss allocated to
participating securities (0.01) (0.03)
Adjusted Diluted EPS (non-
GAAP)(1) $(0.28) $(0.76)
(1)Amounts may not sum due to
rounding.
Three Months Ended March 31,
(In thousands) 2020 2019
---
Net loss attributable to
Amyris, Inc. common
stockholders (GAAP) $(86,757) $(63,813)
Non-GAAP adjustments:
Interest expense 15,002 12,534
Provision for income taxes 91
Depreciation and amortization 1,720 848
Loss allocated to
participating securities (1,087) (2,430)
EBITDA (71,031) (52,861)
(Gain) loss from change in
fair value of derivative
instruments (3,282) 2,039
Loss from change in fair value
of debt 16,503 2,130
Loss upon extinguishment of
debt 27,319
Other expense, net 411 115
Stock-based compensation
expense 3,504 3,452
Adjusted EBITDA $(26,576) $(45,125)
Amyris, Inc.
RECONCILIATION
OF GAAP TO
NON-GAAP
FINANCIAL
INFORMATION
(Unaudited)
Three Months Ended March
31,
(In
thousands) 2020 2019
---
Revenue
(GAAP and
non-GAAP) $29,130 $14,374
Cost of
products
sold (GAAP) $11,790 $17,707
Other costs/
provisions (815) 2,008
Excess
capacity (66) (441)
Depreciation
and
amortization (233) (136)
Cost of
products
sold (non-
GAAP) $10,676 $19,138
Adjusted
gross
profit
(non-GAAP) $18,454 $(4,764)
Gross margin
% 63% -33%
Research and
development
expense
(GAAP) $17,126 $17,839
Stock-based
compensation
expense (1,065) (663)
Depreciation
and
amortization (1,225) (434)
Research and
development
expense
(non-GAAP) $14,836 $16,742
Sales,
general and
administrative
expense
(GAAP) $32,014 $28,253
Stock-based
compensation
expense (2,439) (2,789)
Depreciation
and
amortization (262) (278)
Sales,
general and
administrative
expense
(non-GAAP) $29,313 $25,186
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SOURCE Amyris, Inc.
