Hofseth Biocare ASA: HBC Second Quarter 2018 Financial Report

Hofseth BioCare ASA had operating revenues of NOK 14.6 million (5.5 million) in the second quarter of 2018. Sales revenues for the first six months of 2018 amounted to NOK 29.4 million (11.9 million). Cost of Goods Sold (CoGS) amounted to NOK 11.8 million (5.0 million) in the period, leaving an EBITDA for the second quarter 2018 was negative NOK 12.9 million (-13.3 million).
 
Cash flow from operations during the second quarter was positive by NOK 7.9 million compared to negative NOK 9.6 million in the same quarter last year.
 
In the second quarter 2018, HBC Midsund processed 2,574 tons of salmon and trout raw materials, which is an increase of 26.2 % compared to the second quarter 2017. First half 2018 production was 5,236 tons compared to 4,281 tons in the corresponding period last year. In the second quarter of 2018, a total of 1,027.4 tons of finished goods were manufactured at our plants.
 
The KGK Health Canada approved clinical trial with 20 patients on a daily 5g ProGo® flavored sachet started with all patients in June 2018. The 128-day trial will measure Energy, Weight, anti-inflammatory markers and hair, nail and skin health. The study is listed on the USFDA website, www.clinicaltrials.gov.
 
Our successful gene regulation results on two human cell-lines (HEGP and HIEC-6) for modulating oxidative stress related genes with ProGo® are finished, and further invivo testing is ongoing and will continue together with researchers at the Stanford School of Medicine. We have also completed Our CalGo® human cell based invitro assay to investigate the differential effects of CalGo® on bone absorption (osteoclasts) and deposition (osteoblasts) with researchers at St. Xavier's College.
 
Highlights in the quarter:
- Approved plans at Midsund municipality for future expansion of the Midsund plant.
- Higher sales into higher priced market, has increased the average price of OmeGo® with 19.6 % from the first to the second quarter, and the pet industry accounted for 8.3 % (4.2 %) of OmeGo® sales in the quarter
- Further improvement on PetGo(TM) yields after process adjustments implemented in April.
- Started the second phase testing on HBC's Salmon peptides to treat enterocolitis in neonate babies and sarcopenia in geriatric patients, at the Stanford School of Medicine in California.
- Started our ProGo® Sarcopenia animal model study with SAFORD with preliminary results expected in the fourth quarter
- HBC executed a private placement of NOK 123.2 million and announced a repair issue of NOK 20 million to be carried out from August 27th.
 
"We are doing important work these days on product development on finished products. Combined with the increase of production volumes and the increase in OmeGo® pricing, we expect this work will have positive effects on our results in 2018 and into the future of Hofseth BioCare", said Hofseth BioCare CEO, Mr. Roger Hofseth.
 
For further information, please contact:
Roger Hofseth, CEO of Hofseth BioCare ASA
Mob: +47 95147941
E-mail: rh@hofseth-as.no
 
Jon Olav Ødegård, CFO of Hofseth BioCare ASA
Mob: +47 93632966
E-mail: joo@hofsethbiocare.no
 
About Hofseth BioCare ASA:
HBC is a Norwegian biotech company that offers high-value ingredients and finished products for humans and pets. The company is founded on the core values of sustainability, traceability and optimal utilization of natural resources. Through an innovative hydrolysis technology, HBC is able to preserve the quality of salmon oil, proteins and calcium, prepared of fresh salmon off-cuts. HBC's objective is to contribute to the efficient use of marine resources and deliver quality products for ingredients and finished consumer products in the nutrition market.
Hofseth BioCare's headquarters are located in Ålesund, Norway with branches in Oslo, Chicago, Mumbai and Tokyo. HBC is listed on Oslo Stock Exchange Axess list with ticker "HBC". More information about Hofseth BioCare at www.hofsethbiocare.com and www.facebook.com/hofsethbiocare
 
This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
HBC - Q2 2018 Financial Report