Mar 20, 2012 |
International Stem Cell Corporation Announces 2011 Financial Results |
International Stem Cell Corporation (OTCBB: ISCO) (www.internationalstemcell.com)
today announced year-end financial results for the year ended December
31, 2011. ISCO is a California-based development-stage biotechnology
company that is focused on therapeutic, biomedical and cosmeceutical
product development and commercialization with multiple long-term
therapeutic opportunities and two revenue-generating businesses offering
potential for increased future revenue.
ISCO reported revenue of $1.1 million for the fourth quarter ended
December 31, 2011, reflecting a 110% increase from the same period of
the prior year. For the twelve months ended December 31, 2011, the
Company reported revenue of $4.5 million, reflecting a year-over-year
increase of 189%. The increases in revenues in both periods were
primarily driven by strong sales at ISCO's wholly-owned subsidiary
Lifeline Skin Care (LSC). In addition, steady growth in sales from
ISCO's other wholly-owned subsidiary, Lifeline Cell Technology (LCT),
contributed to the increases in revenues for both periods.
While the Company continued to invest in therapeutic projects,
development of new technologies, and expansion of products and channels
of distribution, to date we have generated limited revenue to support
our core therapeutic research and development efforts. For the three
months ended December 31, 2011, development expenses, excluding cost of
sales, increased $507,000 or 17% compared with the same period of 2010,
a reflection of increased G&A expenses resulting from higher stock-based
compensation expenses.
For the twelve months ended December 31, 2011, development expenses,
excluding costs of sales, increased approximately $3.0 million or 26%
when compared with the prior year period. The majority of the increase
was primarily due to increases in general and administrative and
research and development activities. General and administrative expenses
increased largely due to increased non-cash stock-based compensation,
higher headcount, and increased expenses related business development
activity and general corporate expenses. Research & Development expenses
increased mainly due to increased number and complexity of experiments
associated with our scientific projects. The increase in development
expenses was also related to increased research activities on
therapeutic products and product research activities for LSC and LCT
coupled with increased sales and marketing expenses related to our skin
care products.
Some of the 2011 Highlights:
-- A number of donors willing to provide oocytes for research purposed
were enrolled in ISCO's program to establish a bank of clinical grade
hpSC capable of being immune-matched to millions of patients.
-- The Research and Development team successfully completed the first
series of preclinical studies that supports the therapeutic use of
hepatocytes (liver cells) and neuronal cells derived from human
parthenogenetic stem cells (hpSC). These in vivo experiments
demonstrated that the derived cells are able to survive in targeted
locations in mice without causing tumors.
-- We became Sarbanes-Oxley compliant and maintained, in all material
respects, effective internal controls over financial reporting as of
December 31, 2011.
-- We strengthened our Management Team through the appointments of
well-known industry executives: Kurt May as President & Chief Operating
Officer, Linh Nguyen as Chief Financial Officer, Donna Queen as Vice
President of Marketing and Business Development for LSC.
-- Lifeline Skin Care launched a number of new sales and marketing
initiatives including positioning the brand as the first bio-tech skin
care company vested in technology-driven proprietary ingredients,
opening new destination and resort spa sales and marketing channels and
developing close working relationships and strategic partnerships with
peer-group influencers in dermatology and plastic surgery clinics. LSC
was also featured in the national media promoting its products and
ISCO's technology, began distributing products in Australia and New
Zealand, and initiated marketing agreements in other selected
international markets.
-- Lifeline Cell Technology opened new international distribution
channels in Singapore, Malaysia, Indonesia, Korea and India, providing a
well-balanced distribution system consisting of direct domestic sales,
private label manufacturing contracts and added international
distribution partners.
About International Stem Cell Corporation
International Stem Cell Corporation is focused on the therapeutic
application of human parthenogenetic stem cells and the development and
commercialization of cell-based research and cosmetic products. ISCO's
core technology, parthenogenesis, results in the creation of
pluripotent human stem cells from unfertilized oocytes (eggs). hpSCs
avoid ethical issues associated with the use or destruction of viable
human embryos. ISCO scientists have created the first parthenogenic,
homozygous stem cell line that can be a source of therapeutic cells with
minimal immune rejection after transplantation into hundreds of millions
of individuals of differing genders, ages and racial background. This
offers the potential to create the first true stem cell bank,
UniStemCell™. ISCO also produces and markets specialized cells and
growth media for therapeutic research worldwide through its subsidiary
Lifeline Cell Technology, and cell-based skin care products through its
subsidiary Lifeline Skin Care. More information is available at www.internationalstemcell.com.
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| | INTERNATIONAL STEM CELL CORPORATION AND SUBSIDIARIES (A
Developmental Stage Company) Consolidated Balance Sheets (in thousands, except share data) | | | | | | | | | | | | | |
| | | | | December 31, | | | | | 2011 | | | | | | | | | 2010 | Assets | | | | | | | | | | | | | |
Current assets
| | | | | | | | | | | | | |
Cash and cash equivalents
| | | |
$
|
1,337
| | | | | | | | | |
$
|
5,782
| |
Accounts receivable
| | | | |
140
| | | | | | | | | | |
739
| |
Inventory, net
| | | | |
1,268
| | | | | | | | | | |
856
| |
Prepaid assets
| | | |
|
274
|
| | | | | | | | |
|
228
|
| | | | | | | | | | | | | |
|
Total current assets
| | | | |
3,019
| | | | | | | | | | |
7,605
| |
Property and equipment, net
| | | | |
1,420
| | | | | | | | | | |
1,296
| |
Intangible assets, net
| | | | |
1,282
| | | | | | | | | | |
986
| |
Deposits and other assets
| | | |
|
16
|
| | | | | | | | |
|
40
|
| | | | | | | | | | | | | |
|
Total assets
| | | |
$
|
5,737
|
| | | | | | | | |
$
|
9,927
|
| | | | | | | | | | | | | |
| Liabilities and Stockholders' Equity | | | | | | | | | | | | | |
Current liabilities
| | | | | | | | | | | | | |
Accounts payable
| | | |
$
|
885
| | | | | | | | | |
$
|
583
| |
Accrued liabilities
| | | | |
752
| | | | | | | | | | |
545
| |
Deferred revenue
| | | | |
189
| | | | | | | | | | |
760
| |
Convertible debt and advances
| | | | |
250
| | | | | | | | | | |
250
| |
Warrants to purchase common stock
| | | |
|
38
|
| | | | | | | | |
|
2,400
|
| | | | | | | | | | | | | |
|
Total liabilities
| | | |
|
2,114
|
| | | | | | | | |
|
4,538
|
| | | | | | | | | | | | | |
| Stockholders' Equity | | | | | | | | | | | | | |
Series D Preferred stock, $0.001 par value 50 shares authorized, 43
issued and outstanding for 2011 and 2010
| | | | |
-
| | | | | | | | | | |
-
| |
Series A Preferred stock, $0.001 par value 5,000,000 shares
authorized, 500,000 issued and outstanding for 2011 and 2010,
liquidation preferences of $615,000 and $585,000 in 2011 and 2010,
respectively
| | | | |
1
| | | | | | | | | | |
1
| |
Series B Preferred stock, $0.001 par value 5,000,000 shares
authorized, 300,000 issued and outstanding for 2011 and 2010,
liquidation preferences of $367,000 and $349,000 in 2011 and 2010,
respectively
| | | | |
0
| | | | | | | | | | |
0
| |
Series C Preferred stock, $0.001 par value 3,000,000 shares
authorized, 2,000,000 issued and outstanding for 2011 and 2010,
liquidation preferences of $2,387,000 and $2,267,000 in 2011 and
2010, respectively
| | | | |
2
| | | | | | | | | | |
2
| |
Common stock, $0.001 par value 200,000,000 shares authorized,
80,036,315 and 74,771,107 issued and outstanding for 2011 and 2010,
respectively
| | | | |
80
| | | | | | | | | | |
75
| |
Subscription receivable on common stock
| | | | |
-
| | | | | | | | | | |
(5
|
)
|
Additional paid-in capital
| | | | |
63,995
| | | | | | | | | | |
56,170
| |
Deficit accumulated during the development stage
| | | |
|
(60,455
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)
| | | | | | | | |
|
(50,854
|
)
| | | | | | | | | | | | | |
|
Total stockholders' equity
| | | |
|
3,623
|
| | | | | | | | |
|
5,389
|
| | | | | | | | | | | | | |
|
Total liabilities and stockholders' equity
| | | |
$
|
5,737
|
| | | | | | | | |
$
|
9,927
|
| | | | | | | | | | | | | |
|
See accompanying notes to consolidated financial statements
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| | INTERNATIONAL STEM CELL CORPORATION AND SUBSIDIARIES (A
Developmental Stage Company) Consolidated Statements of Operations (in thousands, except per share data) | | | | | | | | | | | | | | | | |
| | | | | Year Ended December 31, | | | | | | Inception (August 17, 2001) through December
31, 2011 | | | | | 2011 | | | | | | 2010 | | | | | | | | | | | | | | | | | | | | | |
|
Product sales
| | | |
$
|
4,532
| | | | | | |
$
|
1,568
| | | | | | |
$
|
7,631
| |
Royalties and license
| | | |
|
-
|
| | | | | |
|
-
|
| | | | | |
|
135
|
| | | | | | | | | | | | | | | | |
|
Total revenue
| | | |
|
4,532
|
| | | | | |
|
1,568
|
| | | | | |
|
7,766
|
| | | | | | | | | | | | | | | | |
|
Development expenses
| | | | | | | | | | | | | | | | |
Cost of sales
| | | | |
1,618
| | | | | | | |
725
| | | | | | | |
3,334
| |
Research and development
| | | | |
4,434
| | | | | | | |
3,374
| | | | | | | |
18,294
| |
Marketing
| | | | |
1,475
| | | | | | | |
860
| | | | | | | |
3,874
| |
General and administrative
| | | |
|
8,360
|
| | | | | |
|
7,071
|
| | | | | |
|
31,684
|
| | | | | | | | | | | | | | | | |
|
Total development expenses
| | | |
|
15,887
|
| | | | | |
|
12,030
|
| | | | | |
|
57,186
|
| | | | | | | | | | | | | | | | |
|
Loss from development activities
| | | | |
(11,355
|
)
| | | | | | |
(10,462
|
)
| | | | | | |
(49,420
|
)
|
Other income (expense)
| | | | | | | | | | | | | | | | |
Settlement with related company
| | | | |
-
| | | | | | | |
-
| | | | | | | |
(93
|
)
|
Miscellaneous
| | | | |
(163
|
)
| | | | | | |
(26
|
)
| | | | | | |
(180
|
)
|
Dividend and interest income
| | | | |
1
| | | | | | | |
28
| | | | | | | |
94
| |
Interest expense
| | | | |
-
| | | | | | | |
(14
|
)
| | | | | | |
(2,225
|
)
|
Change in market value of warrants
| | | | |
2,335
| | | | | | | |
(2,501
|
)
| | | | | | |
(1,395
|
)
|
Sublease income
| | | |
|
11
|
| | | | | |
|
252
|
| | | | | |
|
309
|
| | | | | | | | | | | | | | | | |
|
Total other income (expense)
| | | |
|
2,184
|
| | | | | |
|
(2,261
|
)
| | | | | |
|
(3,490
|
)
| | | | | | | | | | | | | | | | |
|
Loss before income taxes
| | | | |
(9,171
|
)
| | | | | | |
(12,723
|
)
| | | | | | |
(52,910
|
)
|
Provision for income taxes
| | | |
|
-
|
| | | | | |
|
-
|
| | | | | |
|
7
|
| | | | | | | | | | | | | | | | |
|
Net loss
| | | |
$
|
(9,171
|
)
| | | | | |
$
|
(12,723
|
)
| | | | | |
$
|
(52,917
|
)
| | | | | | | | | | | | | | | | |
|
Dividend on preferred stock
| | | |
|
(430
|
)
| | | | | |
|
(1,561
|
)
| | | | | |
|
(7,968
|
)
| | | | | | | | | | | | | | | | |
|
Net loss applicable to common stockholders
| | | |
$
|
(9,601
|
)
| | | | | |
$
|
(14,284
|
)
| | | | | |
$
|
(60,885
|
)
| | | | | | | | | | | | | | | | |
|
Net loss per common share-basic and diluted
| | | |
$
|
(0.12
|
)
| | | | | |
$
|
(0.21
|
)
| | | | | |
|
n/a
|
| | | | | | | | | | | | | | | | |
|
Weighted average shares-basic and diluted
| | | |
|
77,320
|
| | | | | |
|
68,762
|
| | | | | |
|
n/a
|
| | | | | | | | | | | | | | | | |
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See accompanying notes to consolidated financial statements
International Stem Cell Corporation Linh Nguyen, CFO 760-940-6383 lnguyen@intlstemcell.com or Dr.
Ruslan Semechkin, Vice President 760-940-6383 ras@intlstemcell.com |
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