Microbix first quarter revenues decrease 34% to $812,694

One-time adjustment moves sales temporarily lower; strategic initiatives boost cash flow position

Microbix Biosystems Inc. (TSX: MBX), a biotechnology company commercializing novel technologies for influenza vaccine manufacturing and livestock semen sexing, in addition to a core business of virology products, today reported financial results for the first quarter of fiscal 2011. For the quarter ended December 31, 2010, Microbix reported revenues of $812,694, a 34% decrease from $1,226,538 for the same period in 2009. 

The decline was primarily due to the timing of customer orders and, in particular, a one-time unplanned production adjustment by one large customer.  This long-term relationship will be returning to a regular delivery schedule during the next 9 months. The negative impact of the strong Canadian dollar also impacted earnings for Microbix, which records most of its sales in U.S. dollars and Euros.

Operating Expenses declined nearly 20% compared to last year reflecting reduced spending on the pipeline projects as they transition to stand-alone status.  The Net Operating Loss for the quarter was $734,360 compared to a Loss of $740,031 for the same period last year. Cash Flow for the quarter was $176,801 compared to negative $467,388 for the same period last year.  This improvement was the result of increased cash from operations, as well as a successful equity financing late in the quarter.

Microbix CEO, William J. Gastle, said: "The effects of a reduced burn rate on our three pipeline technologies is beginning to show in our results, as our focus shifts from pure product development activities, to the creation of operating partnerships designed to produce revenue streams for LumiSort™,  the Hunan joint venture in China, and Urokinase."

In December Microbix announced it had formed Crucible International Biotechnologies Corp., which is being capitalized through an initial private offering of at least $2,800,000.  Following this financing Microbix will own approximately 80% of Crucible, which will own all of the influenza vaccine assets of Microbix, including its VIRUSMAX™ technology and the company's 50% ownership interest in the Hunan joint venture. Microbix also announced a new partnership agreement on Lumisort, its proprietary semen sexing technology, in late fiscal 2010. Please visit www.sedar.com for recent Microbix Biosystems, Inc. filings on its pipeline products and financial information.