Metabolix second-quarter net loss decreases to $9.5 million

Jul 29 2010

Metabolix, Inc. (NASDAQ: MBLX), a bioscience company focused on developing sustainable solutions for plastics, chemicals and energy, today reported financial results for the three months ended June 30, 2010.

“We are very pleased with our progress across each of our three Metabolix platforms during the second quarter. We believe the combination of these differentiated offerings will deliver exceptional value given the strong market demand for sustainable solutions.”

The Company reported a net loss of $9.5 million or $0.36 per share for the second quarter of 2010 as compared to a net loss of $9.7 million or $0.42 per share for the second quarter of 2009.

The Company's net cash used for operating activities during the second quarter of 2010 was $7.4 million, which compares to net cash used of $4.0 million for the comparable quarter in 2009. Unrestricted cash and short-term investments at June 30, 2010 totaled $77.1 million. The Company continues to have no long-term debt.

SECOND QUARTER 2010 AND THE FIRST HALF FINANCIAL OVERVIEW

Metabolix currently manages its finances with an emphasis on cash flow. Metabolix used $7.4 million of cash in operating activities for the second quarter 2010, which represents an increase in cash usage from $4.0 million used during the comparable period of 2009. Net cash used in operating activities reflects the Company's sales and marketing activities as well as research and product development. The $3.4 million increase in cash usage over the comparable quarter last year is mostly attributable to a decrease in ADM support payments. During the second quarter 2009, Metabolix received the final two quarterly support payments from ADM totaling $3.2 million.

Through the first six months of 2010 ending June 30th, net cash used in operating activities was $16.8 million, as compared to net cash used of $12.6 million for the comparable period of 2009. The year-over-year increase in cash usage for the first six months of 2010 is primarily attributed to decreased cash receipts in 2010 versus 2009. The decrease in cash receipts for the first six months of 2010 is a result of the decrease in quarterly support payments received from ADM, a decrease in funds received from investment income, and lower grant revenue from the Integrated Bio-Engineered Chemicals grant that expired in the fourth quarter of 2009.

Total revenue in the second quarter of 2010 was $0.1 million, compared to $0.3 million in the same period of 2009. During the three months ended June 30, 2010 revenue was earned primarily from the delivery of Mirel™ bioplastics product samples to potential customers. The quarter-over-quarter decrease was attributable to lower revenue recognized from government research grants. Work was completed on our Integrated Bio-Engineered Chemicals grant during the fourth quarter of 2009 and minimal billable work was performed on the Company's remaining grant during the second quarter 2010. Revenue for the six months ended June 30, 2010 was $0.3 million compared to $0.6 million in the same period of 2009, and the year-over-year decrease was primarily related to lower sample product revenue and lower grant revenue.

For the three months ended June 30, 2010, total operating expenses were $9.7 million as compared to $10.3 million for the comparable quarter in 2009.

Research and development expenses were $5.8 million for the three months ended June 30, 2010 as compared to $6.3 million for the comparable quarter in 2009. The $0.5 million decrease was primarily due to reduced activity at our pre-commercial manufacturing facility due to the transitioning to the Commercial Manufacturing Facility. Selling, general and administrative expenses were $3.8 million for the three months ended June 30, 2010 as compared to $3.9 million for the comparable quarter in 2009.

For the six months ended June 30, 2010, total operating expenses were $19.7 million as compared to $20.0 million for the comparable period in 2009.

For the six months ended June 30, 2010, total research and development expenses were $12.0 million as compared to $12.3 million for the comparable six months of 2009. The decrease in year over year research and development expense primarily relates to reduced activity at our pre-commercial manufacturing facility.

For the six months ended June 30, 2010, total selling general and administrative expenses were $7.7 million, unchanged from $7.7 million for the comparable six months of 2009.

Rick Eno, Chief Executive Officer of Metabolix, commented, "We are very pleased with our progress across each of our three Metabolix platforms during the second quarter. We believe the combination of these differentiated offerings will deliver exceptional value given the strong market demand for sustainable solutions.

• For our first platform, Mirel Bioplastics being commercialized with Archer Daniels Midland (ADM), we received FDA approval for our injection molding resins. The Clinton plant continues to operate well and we are moving customers through the product development cycle. We are steadily building a foundation for that business.
• For Industrial Chemicals, the initial market feedback for our first product, specialty C4 chemicals, is positive. We are continuing with process scale-up and plan to have samples to potential customers in early 2011.
• In our crop-based businesses, we have made substantial progress on our oil seeds commercialization. We have relocated our oil seeds scale-up activities to Saskatoon, Canada, a geographic center for oil seeds development. In addition, we received regulatory approval for our first oil seeds field trial, and are now approaching completion of that trial.

We believe that we have large-scale opportunities to provide compelling economic alternatives to a wide range of traditional petroleum-based materials. We see value not only for our environment and our communities, but a powerful opportunity to create value for our shareholders." \