TerraVia (NASDAQ:TVIA), a next-generation food, nutrition and
specialty ingredients company and pioneer in algae innovation,
announced today results for the fourth quarter and full year ended
December 31, 2016.
“2016 proved to be a defining year for TerraVia in streamlining
around food, nutrition and specialty ingredients,” said Apu Mody,
CEO of TerraVia. “The unique ability of our proprietary ingredients
to address the growing demand for healthier and more sustainable
products is gaining momentum in food, aquaculture, animal nutrition
and specialty personal care. We have sharpened our focus around
commercialization of several high-potential products that we expect
will position TerraVia and the SB Oils JV to achieve accelerated
growth and profitability. The AlgaPrime™ DHA expansion announced
with BioMar and Bunge today is a key step in that direction.”
Results for the fourth quarter and full year highlight early
progress in TerraVia’s refined strategic focus on food, nutrition
and specialty ingredients. Recent developments include:
- Success of AlgaPrime™ DHA in
Aquaculture Market Drives Increased Commercial Distribution
- TerraVia and Bunge Announce Seafoodia
to Bring AlgaPrime™ DHA to EU Animal Nutrition Market
- TerraVia Appoints Food Industry Veteran
Irene Chang Britt as Chairperson of the Board of Directors
- Thrive® Algae Oil Recognized by
Consumers and Influencers for Exceptional Health and Culinary
Benefits
- TerraVia's Whole Algal Protein Gains
Regulatory Approval from Health Canada Expanding Whole Algae
Ingredients Approval Across North America
- TerraVia Announces Third Circuit
Affirms Arbitration Award in Proceedings with Roquette Frères,
S.A.
Financial Review
Financial results for the fourth quarter and full year of 2016
reflect progress in the Company’s transition to food, nutrition and
specialty ingredients, and include the recently completed sale of a
majority interest in the Algenist premium skin care line, which has
been treated as a discontinued operation for prior periods.
Total revenue was $4.8 million compared with $5.4 million in the
fourth quarter of 2015. GAAP net loss narrowed to $27.1 million for
the fourth quarter of 2016, from a net loss of $34.7 million in the
prior year period as the Company begins to benefit from reductions
in cash operating expenditures. On a non-GAAP basis, the net loss
also declined to $18.3 million for the fourth quarter of 2016,
compared with net loss of $24.7 million in the prior year
quarter.
Total revenue was $18.5 million compared with $22.9 million in
the full year 2015. GAAP net loss narrowed to $101.6 million for
2016, from a net loss of $141.4 million in the prior year as the
Company begins to benefit from reductions in cash operating
expenditures. On a non-GAAP basis, the net loss also declined to
$80.5 million for 2016, compared with net loss of $116.3 million in
the prior year. A reconciliation of GAAP to non-GAAP net loss is
included in the financial tables appended to this press
release.
Excluding intercompany transactions, revenues from the 50.1%
owned unconsolidated SB Oils JV totaled $4.3 million for the fourth
quarter and $9.8 million for the full year versus $1.5 million in
the fourth quarter of 2015 and $3.1 million for the prior year.
“We are pleased to have met our guidance provided on the Q3
earnings conference call. We ended the year with operational and
commercial momentum, including the highest recorded revenue out of
the SB Oils JV since its formation,” commented Tyler Painter, COO
and CFO of TerraVia. “By aggressively managing our costs, focusing
our commercial efforts, and engaging in strategic work with
Rothschild, we are actively pursuing initiatives to maximize value
for all of our stakeholders.”
Conference Call
TerraVia Holdings, Inc. will hold a conference call for
investors on March 8, 2017 at 1:30 p.m. PT (4:30 p.m. ET).
Investors may access the call by dialing 973-409-9250. A live
webcast of the call will be available on the Investors section of
www.terravia.com. A recording of the call will also be available by
calling 404-537-3406; access code 73754339 beginning approximately
two hours after the call, and will be available for one week. A
webcast replay from today’s call will also be available on the
Investors section of www.terravia.com approximately two hours after
the call and will be available for up to thirty days.
About TerraVia
TerraVia is a plant-based food, nutrition and specialty
ingredients company that harnesses the power of algae, the mother
of all plants and earth's original superfood. With a portfolio of
breakthrough ingredients and manufacturing, the Company is well
positioned to help meet the growing need of consumer packaged goods
and established and emerging food manufacturers to improve the
nutritional profile of foods without sacrificing taste, and to
develop select consumer brands. The Company also manufactures a
range of specialty personal care ingredients for key strategic
partners. Headquartered in South San Francisco, the Company's
mission is to create products that are truly better for people and
better for the planet. For additional information, please visit
TerraVia's website at www.terravia.com.
TerraVia, Thrive®, AlgaPrime™, the TerraVia logo and other
trademarks or service names are the trademarks of TerraVia
Holdings, Inc.
Non-GAAP Financial Measures
This press release includes the following financial measure
defined as a “non-GAAP financial measure” by the Securities and
Exchange Commission: non-GAAP net loss. This measure may be
different from non-GAAP financial measures used by other companies.
The presentation of this financial information, which is not
prepared under any comprehensive set of accounting rules or
principles, is not intended to be considered in isolation or as a
substitute for the financial information prepared and presented in
accordance with generally accepted accounting principles. For a
reconciliation of this non-GAAP financial measure to the nearest
comparable GAAP measure, see “Reconciliation of GAAP to Non-GAAP
Net Loss” included in the tables to this press release.
This non-GAAP measure is provided to enhance investors’ overall
understanding of TerraVia’s current financial performance and
TerraVia’s prospects for the future. Specifically, TerraVia
believes the non-GAAP measure provides useful information to both
management and investors by excluding certain expenses that may not
be indicative of its core operating results and business
outlook.
For its internal budgeting process, TerraVia’s management uses
financial measures that do not include stock-based compensation
expense, restructuring expense, or special expenses such as
non-cash gains or losses related to derivative liabilities,
amortization of debt discount and issuance costs, and income (loss)
from discontinued operations. In addition to the corresponding GAAP
measure, TerraVia’s management also uses the foregoing non-GAAP
measures in reviewing the financial results of TerraVia. TerraVia
excludes stock-based compensation expenses, debt conversion
expenses, income tax benefit, and special non-cash charges from its
non-GAAP measures primarily because they are non-cash expenses that
management does not believe are reflective of ongoing operating
results.
Forward Looking Statements
This press release contains certain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act
of 1995 about TerraVia, including statements that involve risks and
uncertainties concerning: its strategic, product, commercialization
and production plans and market opportunities; its transition of
corporate strategy; its ability to manage its costs; its ability to
maximize value for stakeholders; its ability to raise additional
capital and/or recapitalize its outstanding convertible senior
subordinated notes; and its ability to maintain its relationships
with its partners. When used in this press release, the words
“will”, “expects”, “intends” and other similar expressions and any
other statements that are not historical facts are intended to
identify those assertions as forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Any such statement may be influenced by a variety of factors, many
of which are beyond the control of TerraVia, that could cause
actual outcomes and results to be materially different from those
projected, described, expressed or implied in this press release
due to a number of risks and uncertainties. Potential risks and
uncertainties include, among others: TerraVia’s limited operating
history; its limited history in manufacturing and commercializing
products; the successful transition to a new chief executive
officer; production management risks; implementation risk in
deploying new technologies; its limited experience in constructing,
ramping up and operating commercial manufacturing facilities; its
ability to successfully develop and commercialize products; its
ability to sell its products at a profit; delays related to ramp-up
and optimization of production facilities; availability of
consistent, reliable power and steam; its ability to manage costs;
its ability to enter into and maintain strategic collaborations;
successful product trials by its customers and market acceptance
and adoption of its products by end-users; its ability to obtain
requisite regulatory approvals; its access, on favorable terms, to
any required financing; and its ability to successfully transition
its corporate strategy. Accordingly, no assurances can be given
that any of the events anticipated by the forward-looking
statements will transpire or occur, or if any of them do so, what
impact they will have on the results of operations or financial
condition of TerraVia.
In addition, please refer to the documents that TerraVia
Holdings, Inc. files with the Securities and Exchange Commission,
including its Annual Report on Form 10-K and Quarterly Reports on
Form 10-Q, as updated from time to time, for a discussion of these
and other risks. You are cautioned not to place undue reliance on
forward-looking statements, which speak only as of the date of this
press release. TerraVia is not under any duty to update any of the
information in this press release.
TERRAVIA HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS In
thousands, except per share amounts (UNAUDITED)
Three Months Ended December
31,
Year Ended December 31,
2016 2015 2016 2015
Revenues Product revenues $ 617 $ 2,045 $ 3,483 $ 10,022
Research and development programs 4,219 3,348
14,999 12,831 Total revenues
4,836 5,393 18,482 22,853
Costs and operating expenses Cost of product revenues 2,218
2,788 5,256 10,563 Research and development 6,901 9,586 31,116
48,094 Sales, general and administrative 10,096 14,075 43,741
62,041 Restructuring charges (43 ) 4,581
1,412 4,953 Total costs and operating
expenses
19,172 31,030 81,525 125,651
Loss from continuing operations before
other income (expense)
(14,336 ) (25,637
) (63,043 ) (102,798 )
Other income (expense) Interest and other income (expense),
net (2,544 ) (3,288 ) (11,797 ) (13,196 ) Debt conversion expense
(4,743 ) - (9,770 ) - Loss from equity method investments (5,783 )
(4,098 ) (22,391 ) (22,389 ) Gain (loss) from change in fair value
of derivative liabilities - (26 ) 82
1 Total other income (expense), net
(13,070 ) (7,412 )
(43,876 ) (35,584 ) Loss from
continuing operations before income taxes
(27,406 )
(33,049 ) (106,919 ) (138,382
) Income tax benefit (223 ) -
(2,062 ) - Loss from continuing operations
(27,183 ) (33,049 ) (104,857
) (138,382 ) Income (loss) from discontinued
operations 71 (1,644 ) 3,301
(3,065 )
Net loss $ (27,112 )
$ (34,693 ) $ (101,556 )
$ (141,447 ) Net loss per share, basic and
diluted Continuing operations $ (0.30 ) $ (0.41 ) $ (1.22 ) $
(1.73 ) Discontinued operations 0.00 (0.02 )
0.04 (0.03 )
Net loss per share, basic and
diluted $ (0.30 ) $ (0.43
) $ (1.18 ) $ (1.76
) Weighted average number of common shares used in
net loss per share computation - basic and diluted
91,582 80,600 85,952 80,165
TERRAVIA HOLDINGS, INC.
RECONCILIATION OF GAAP TO NON-GAAP NET LOSS AND NET LOSS PER
SHARE In thousands, except per share amounts (UNAUDITED)
Three Months Ended December
31,
Year Ended December 31,
2016 2015 2016 2015 GAAP Net
loss $ (27,112 ) $ (34,693 ) $ (101,556 ) $ (141,447 ) Encapso
assets write off included in cost of product revenues 1,348 - 1,348
- Operating expenses includes costs as follows: Research and
development 640 967 2,623 4,562 Sales, general and administrative
1,849 2,114 8,827
10,052 Total stock-based compensation expense 2,489 3,081
11,450 14,614 Restructuring charges (43 ) 4,581 1,412 4,953 Other
income (expense) includes costs as follows: Amortization of debt
discount and issuance costs 591 654 2,560 2,554 Debt conversion
expense 4,743 - 9,770 - (Gain) loss from change in fair value of
derivative liabilities - 26 (82 ) (1 ) Income tax benefit (223 ) -
(2,062 ) - (Income) loss from discontinued operations (71 )
1,644 (3,301 ) 3,065
Non-GAAP
Net loss $ (18,278 ) $
(24,707 ) $ (80,461 ) $
(116,262 ) GAAP Net loss per share - basic and
diluted $ (0.30 ) $ (0.43 ) $ (1.18 ) $ (1.76 ) Encapso assets
write off included in cost of product revenues 0.01 - 0.02 -
Stock-based compensation expense 0.03 0.04 0.13 0.18 Restructuring
charges - 0.05 0.02 0.06 Amortization of debt discount and issuance
costs 0.01 0.01 0.03 0.03 Debt conversion expense 0.05 - 0.11 -
Income tax benefit - - (0.03 ) - (Income) loss from discontinued
operations - 0.02 (0.04 )
0.04
Non-GAAP Net loss per share - basic and diluted
$ (0.20 ) $ (0.31 )
$ (0.94 ) $ (1.45 )
TERRAVIA HOLDINGS, INC. CONDENSED
CONSOLIDATED BALANCE SHEETS In thousands (UNAUDITED)
December 31, December 31, 2016 2015
Assets
Current
assets
Cash, cash equivalents and marketable securities $ 64,031 $ 97,975
Other current assets 3,968 7,580 Current assets of discontinued
operations - 13,389
Total current
assets 67,999 118,944 Property, plant and
equipment - net 22,674 25,996 Equity method investments 43,856
35,910 Other assets 1,180 1,122
Total assets $ 135,709 $
181,972
Liabilities,
convertible preferred stock and stockholders'
deficit
Total current liabilities $ 16,287 $ 25,330 Other
liabilities 1,395 1,102 Long-term debt 174,620
202,015
Total liabilities 192,302
228,447 Convertible preferred
stock 25,653 - Total stockholders' deficit
(82,246 ) (46,475 )
Total liabilities, convertible preferred stock and stockholders'
deficit $ 135,709 $ 181,972
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TerraVia Holdings, Inc.Corporate Communications:Katie
Ringerpress@terravia.comorJM Strategic Communications GroupJeff
Majtyka, 646-776-0886jeff@jmscgroup.comTaylor Krafchik,
646-776-0886taylor@jmscgroup.com