Continues to Build on Fiscal 2014 Achievements
TORONTO, Feb. 26, 2015 /CNW/ - SQI Diagnostics Inc. ("SQI" or the "Company") (TSX-V: SQD; OTCQX: SQIDF), a life sciences company that develops and commercializes proprietary technologies and products for advanced microarray diagnostics, today reported its financial and operational results for the fiscal first quarter ended December 31, 2014. All figures in this press release are in Canadian dollars (CAD), unless otherwise stated.
"During the quarter the Company continued to win new business from our existing customers and add to our sales pipeline," said Andrew Morris, President and CEO of SQI. "We expect this additional business to result in the installation of multiple platforms which are the basis for sustainable and on-going revenue growth through the sale of custom and other high volume test products."
Highlights for the Quarter
- Our first global pharmaceutical customer has agreed to a consignment sqidlite instrument planned for March 2015 delivery. This global pharma client will evaluate the performance of the sqidlite instrument and two immunogenicity tests developed by SQI, one of which was completed during our first quarter of fiscal 2015. We believe successful evaluation of the instrument and test kits will lead to the purchase of the sqidlite instrument and on-going purchases of test kits.
- We announced a follow-on agreement and technology transfer agreement that expands our partnership with our diagnostic customer in the infectious disease-DNA market.
- We secured a second project from a global pharmaceutical company previously referred to as Global Pharma 3. This second project is meaningful as it is our third global-sized drug development customer that has initiated repeat business.
- We completed the development work for our fourth global pharmaceutical customer. We are confident that we will sell this customer one or more SQI platform(s), as well as kits for human studies for this project during the second half of fiscal 2015. We are in discussions with this customer to develop tests for additional projects relating to other new drugs in their pipeline. Subsequent to the period end, this customer presented select data from this development project at the Immunogenicity and Immunotoxicity conference.
- We re-established our IVD, regulated product capability by attaining FDA clearance for our newest multiplexed celiac diagnostic test. This diagnostic test comprises four individual tests that we have multiplexed into a single test and that is used to aid in the diagnosis of celiac disease. Celiac disease is a leading gastrointestinal illness, reported to occur in 1 in 130 North Americans.
- We continued to expand our pipeline of customers and are in various stages of negotiation with customers for multiple new development projects including: a cardiac biomarker assay; a veterinary assay; and, an immunogenicity assay for use by a US-based CRO. Subsequent to the quarter end, we brought one of these opportunities to fruition and are in active discussions with numerous remaining prospects.
- On January 30, 2015 and on February 20, 2015 the Company completed two tranches of a debenture financing resulting in gross proceeds of $3,236,000.
Financial Results Overview
During the first quarter of fiscal 2015 the Company continued to record revenue from product and services sales in our DDTS business. Revenue for the three months ended December 31, 2014 was $15,000 compared to $2,000 for the same period last year. Revenue in the first quarter of fiscal 2015 includes fess earned for the technology transfer phase of the project to manufacture a DNA-based pathogen detection test as well as for additional work contracted by one of our global pharma customers.
For the quarter-ended December 31, 2014, the Company recorded a net loss of $1,365,000 ($0.02 net loss per share) compared to a net loss of $1,501,000 ($0.03 net loss per share) for the quarter-ended December 31, 2013. The net loss was lower for the three months ended December 31, 2014 as compared to the same period last year due mainly to decreases in R&D expenditures as discussed below.
R&D expenditures, excluding amortization and stock based compensation, for the three months ended December 31, 2014 were $684,000 compared to $840,000 for the three months ended December 31, 2013. R&D costs were lower for the three months ended December 31, 2014 as compared to the same period last year. In the quarter-ended December 31, 2013 the Company incurred significant costs related to the verification and validation of Celiac DGP. There were no assays in the validation or verification stages in the current quarter. In addition the Company incurred lower R&D salary and related costs in the first quarter of fiscal 2015 as compared to the first quarter of fiscal 2014 due to staff reductions made in February of 2014 and other temporary staff changes during the quarter.
Corporate and general expenses, excluding stock-based compensation, were $359,000 for the quarter-ended December 31, 2014 compared to $298,000 for the quarter-ended December 31, 2013. The increase is due to fees incurred in the OTCQX listing process and as a result of investor relations initiatives pursued to increase investor awareness.
Sales and marketing expenses, excluding stock based compensation, totalled $160,000 for the three months ended December 31, 2014 compared to $150,000 for the three months ended December 31, 2013. The increase in sales and marketing expenses is primarily due to the addition of one individual to the sales and marketing area. Sales and marketing expenses in the quarter-ended December 31, 2013 include a bonus paid for the execution of 3 commercial contracts, there were no bonuses paid in the quarter-ended December 31, 2014.
At December 31, 2014, current assets were $744,000 compared to $2,058,000 at September 30, 2014. As at December 31, 2014 the Company has a $342,000 working capital surplus compared to a surplus of $1,625,000 at September 30, 2014. As noted above, the Company completed a financing shortly after the quarter end.
Conference Call Details
President and CEO, Andrew Morris, along with Company management, will host a conference call today to review financial results and discuss business developments for the period. Details are as below:
An archived copy of the conference call will be available for 90 days on the Company website at www.sqidiagnostics.com/about/investors and also at http://www.newswire.ca/en/webcast/detail/1480625/1648303.
Detailed financial statements and the management's discussion and analysis (MD&A) will also be made available on the Company website at www.sqidiagnostics.com and at www.sedar.com.
About SQI Diagnostics
SQI Diagnostics is a life sciences and diagnostics company that develops and commercializes proprietary technologies and products for advanced microarray diagnostics. The Company's proprietary microarray tests and fully-automated systems are designed to simplify protein and antibody testing workflow, increase throughput, reduce costs and provide excellent data quality. For more information, please visit www.sqidiagnostics.com.
This press release contains certain statements including, without limitation, the words "may", "plan", "will", "estimate", "continue", "anticipate", "intend", "expect", "believe", "in the process", "benefits", "leading to", "position" "possible", "is subject to" and other similar expressions which may constitute "forward-looking statements" within the meaning of applicable securities laws. Forward-looking statements reflect the Company's current expectations and assumptions, and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated. Readers are cautioned not to place undue reliance on these forward-looking statements. These forward-looking statements involve risks and uncertainties including, but not limited to: our ability to market and sell our products including our novel multiplexing technologies and detection platforms; our ability to maintain any technical or product advantages; the success of our Diagnostic Tools and Services business and our intent to build near-term revenue streams from this business; the successful regulatory filing and receipt of regulatory approvals for our later stage quantitative diagnostic kits; adverse changes in general economic conditions; international risk and currency exchange fluctuations; competitor activity; technology changes; regulatory approvals and the impact of healthcare reform legislation; and, SQI's ability to raise additional funds in the future.
Such statements, risks and uncertainties are detailed in the Company's ongoing filings with the securities regulatory authorities, and are available to the public at www.sedar.com. The Company undertakes no obligation to publicly update or revise any forward-looking statements either as a result of new information, future events or otherwise, except as required by applicable securities laws.
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.
SOURCE SQI Diagnostics Inc.
For further information: Chief Executive Officer, Andrew Morris, 416.674.9500 ext. 229, firstname.lastname@example.org