Motorsport Games to Report Third Quarter 2022 Financial Results
MIAMI, Nov. 15, 2022 (GLOBE NEWSWIRE) — Motorsport Games Inc. (NASDAQ: MSGM) (“Motorsport Games”), a leading racing game developer, publisher and esports ecosystem provider of official motorsport racing series throughout the world will report financial results for the third quarter ended September 30, 2022 on Friday, November 18, 2022, after market close. Management will host a conference call and webcast on the same day at 5:00 p.m. ET to discuss the results.
Participants may access the live webcast on the Company’s investor relations website at https://ir.motorsportgames.com under “Events.” The call may also be accessed by dialing 1 (877) 407-0784 from the U.S., or by dialing 1 (201) 689-8560 internationally.
About Motorsport Games: Motorsport Games, a Motorsport Network company, is a leading racing game developer, publisher and esports ecosystem provider of official motorsport racing series throughout the world. Combining innovative and engaging video games with exciting esports competitions and content for racing fans and gamers, Motorsport Games strives to make the joy of racing accessible to everyone. The Company is the officially licensed video game developer and publisher for iconic motorsport racing series across PC, PlayStation, Xbox, Nintendo Switch and mobile, including NASCAR, INDYCAR, 24 Hours of Le Mans and the British Touring Car Championship (“BTCC”), as well as the industry leading rFactor 2 and KartKraft simulations. rFactor 2 also serves as the official sim racing platform of Formula E, while also powering F1 Arcade through a partnership with Kindred Concepts. Motorsport Games is an award-winning esports partner of choice for 24 Hours of Le Mans, Formula E, BTCC, the FIA World Rallycross Championship and the eNASCAR Heat Pro League, among others. Motorsport Games is building a virtual racing ecosystem where each product drives excitement, every esports event is an adventure and every story inspires.
VANCOUVER, BC, Nov. 15, 2022 /PRNewswire/ – Defense Metals Corp. (“Defense Metals” or the “Company“; (TSX-V: DEFN) (OTCQB: DFMTF) (FSE: 35D) is pleased to announce additional partial Rare Earth Element (“REE“) assay results from one additional core hole, totalling 353 metres (m), collared within the northern area of Defense Metals’ 100% owned Wicheeda REE Deposit.
Infill drill hole WI22-69 (-50o dip / 230o azimuth) was drilled southwest within the northern area of the deposit intersected a broad zone of mineralized dolomite carbonatite averaging 2.14% total rare earth oxide (“TREO”) over 221 metres (m)1; including a higher-grade interval averaging 3.52% TREO over 111 m (Figure 1).
With over 5,500 m of drilling in 18 holes now complete as part of the 2022 Wicheeda resource delineation and pit geotechnical program, the Company has released assays for a total of 2,493 m in 7 holes. Assays for the remaining 11 holes totalling 3,017 m are expected in the coming weeks and months.
Luisa Moreno, President, and Director of Defense Metals stated: “With these additional assay results our 2022 drilling continues to yield significant intervals of the high-grade REE dolomite carbonatite (DC) lithology. Recent flotation variability testwork has shown this type of mineralization consistently delivers high grade mineral concentrates greater than 40% TREO, at recoveries in excess of 80% (see Defense Metals news release dated October 17, 2022). All the drill holes released to date have included significant REE mineralized DC intervals. As such Defense Metals is confident the 2022 drilling results will contribute positively to the planned Preliminary Feasibility Study (PFS).”
The 100% owned 4,244 hectare Wicheeda REE Property, located approximately 80 km northeast of the city of Prince George, British Columbia, is readily accessible by all-weather gravel roads and is near infrastructure, including power transmission lines, the CN railway, and major highways.
The Wicheeda REE Project yielded a robust 2021 preliminary economic assessment technical report (PEA) that demonstrated an after-tax net present value (NPV@8%) of $517 million, and 18% IRR3. A unique advantage of the Wicheeda REE Project is the production of a saleable high-grade flotation-concentrate. The PEA contemplates a 1.8 Mtpa (million tonnes per year) mill throughput open pit mining operation with 1.75:1 (waste:mill feed) strip ratio over a 19 year mine (project) life producing and average of 25,423 tonnes REO annually. A Phase 1 initial pit strip ratio of 0.63:1 (waste:mill feed) would yield rapid access to higher grade surface mineralization in year 1 and payback of $440 million initial capital within 5 years.
Methodology and QA/QC
The analytical work reported on herein was performed by ALS Canada Ltd. (ALS) at Langley (sample preparation) and Vancouver (ICP-MS fusion), B.C. ALS is an ISO-IEC 17025:2017 and ISO 9001:2015 accredited geoanalytical laboratory and is independent of the Defense Metals and the QP. Drill core samples were subject to crushing at a minimum of 70% passing 2 mm, followed by pulverizing of a 250-gram split to 85% passing 75 microns. A 0.1-gram sample pulp was then subject to multi-element ICP-MS analysis via lithium-borate fusion to determine individual REE content (ME-MS81h). Defense Metals follows industry standard procedures for the work carried out on the Wicheeda Project, with a quality assurance/quality control (QA/QC) program. Blank, duplicate, and standard samples were inserted into the sample sequence sent to the laboratory for analysis. Defense Metals detected no significant QA/QC issues during review of the data.
Qualified Person
The scientific and technical information contained in this news release as it relates to the Wicheeda REE Project has been reviewed and approved by Kristopher J. Raffle, P.Geo. (BC) Principal and Consultant of APEX Geoscience Ltd. of Edmonton, AB, a director of Defense Metals and a “Qualified Person” as defined in NI 43-101. Mr. Raffle verified the data disclosed which includes a review of the sampling, analytical and test data underlying the information and opinions contained therein.
About Defense Metals Corp.
Defense Metals Corp. is a mineral exploration and development company focused on the acquisition, exploration and development of mineral deposits containing metals and elements commonly used in the electric power markets, defense industry, national security sector and in the production of green energy technologies, such as, rare earths magnets used in wind turbines and in permanent magnet motors for electric vehicles. Defense Metals owns 100% of the Wicheeda Rare Earth Element Deposit located near Prince George, British Columbia, Canada. Defense Metals Corp. trades in Canada under the symbol “DEFN” on the TSX Venture Exchange, in the United States, under “DFMTF” on the OTCQB and in Germany on the Frankfurt Exchange under “35D”.
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3 Independent Preliminary Economic Assessment for the Wicheeda Rare Earth Element Project, British Columbia, Canada, dated January 6, 2022, with an effective date of November 7, 2021, and prepared by SRK Consulting (Canada) Inc. is filed under Defense Metals Corp.’s Issuer Profile on SEDAR (www.sedar.com).
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Cautionary Statement Regarding “Forward-Looking” Information
This news release contains “forward–looking information or statements” within the meaning of applicable securities laws, which may include, without limitation, statements relating to advancing the Wicheeda REE Project, drill results including anticipated timeline of such results/assays, the Company’s plan to commence the PFS, the Company’s plans for its Wicheeda REE Project, expanded resource and scale of expanded resource, expected results and outcomes, the technical, financial and business prospects of the Company, its project and other matters. All statements in this news release, other than statements of historical facts, that address events or developments that the Company expects to occur, are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which the Company will operate in the future, including the price of rare earth elements, the anticipated costs and expenditures, the ability to achieve its goals, that general business and economic conditions will not change in a material adverse manner, that financing will be available if and when needed and on reasonable terms. Such forward-looking information reflects the Company’s views with respect to future events and is subject to risks, uncertainties and assumptions, including the risks and uncertainties relating to the interpretation of exploration results, risks related to the inherent uncertainty of exploration and cost estimates, the potential for unexpected costs and expenses and those other risks filed under the Company’s profile on SEDAR at www.sedar.com. While such estimates and assumptions are considered reasonable by the management of the Company, they are inherently subject to significant business, economic, competitive and regulatory uncertainties and risks. Factors that could cause actual results to differ materially from those in forward looking statements include, but are not limited to, continued availability of capital and financing and general economic, market or business conditions, adverse weather and climate conditions, failure to maintain or obtain all necessary government permits, approvals and authorizations, failure to maintain community acceptance (including First Nations), risks relating to unanticipated operational difficulties (including failure of equipment or processes to operate in accordance with specifications or expectations, cost escalation, unavailability of personnel, materials and equipment, government action or delays in the receipt of government approvals, industrial disturbances or other job action, and unanticipated events related to health, safety and environmental matters), risks relating to inaccurate geological and engineering assumptions, decrease in the price of rare earth elements, the impact of Covid-19 or other viruses and diseases on the Company’s ability to operate, an inability to predict and counteract the effects of COVID-19 on the business of the Company, including but not limited to, the effects of COVID-19 on the price of commodities, capital market conditions, restriction on labour and international travel and supply chains, loss of key employees, consultants, or directors, increase in costs, delayed drilling results, litigation, and failure of counterparties to perform their contractual obligations. The Company does not undertake to update forward–looking statements or forward–looking information, except as required by law.
Conference Call Tuesday November 15, 2022 at 11:00 AM (EST)
(All $ figures reported in USD)
Revenue from metals payable of $38.8 million in Q3 2022, a 36% decrease from $60.7 million in Q3 2021 and a 22% decrease from the previous quarter, due to lower throughput at Yauricocha and slower ramp up at Bolivar as a result of a flooding event and operational restrictions due to limited ventilation in the Bolivar NorthWest zone.
Adjusted EBITDA of $(3.9) million in Q3 2022, compared to $17.4 million in Q3 2021 and $1.4 million in Q2 2022.
Net loss attributable to shareholders for Q3 2022 of $46.2 million, or $(0.28) per share (basic and diluted), compared to a net loss of $4.8 million, or ($0.03) per share in Q3 2021, and a net loss of $15.3 million or $(0.09) per share in Q2 2022.
Net loss for Q3 2022 and 9M 2022 includes an impairment charge of $25.0 million ($nil for Q3 2021 and 9M 2021) for the Bolivar mine and $7.0 million ($nil for Q3 2021 and 9M 2021) for the Cusi mine.
Adjusted net loss attributable to shareholders(1) of $10.7 million, or $(0.07) per share for Q3 2022, compared to adjusted net loss of $1.7 million or $(0.01) per share for Q3 2021 and an adjusted net loss of $11.6 million, or $0.07 per share for Q2 2022.
$13.7 million of cash and cash equivalents and working capital of $(52.3) million1 as at September 30, 2022.
Net Debt of $73.6 million as at September 30, 2022.
Suspension of production and financial guidance remains in effect.
1 The negative working capital is largely due to the reclassification of the long-term portion of the credit facility as current, resulting from the breach of certain debt covenants as at September 30, 2022. The Company is seeking accommodation from the lending banks in the form of waivers for this non-compliance.
A shareholder conference call will be held Tuesday, November 15, 2022, at 11:00 AM (EST). Click here to register.
TORONTO–(BUSINESS WIRE)– Sierra Metals Inc. (TSX: SMT) (BVL or Bolsa de Valores de Lima: SMT) (NYSE AMERICAN: SMTS) (“Sierra Metals” or “the Company”) today reported revenue of $38.8 million, a 36% decline from Q3 2021 and a 22% decline from Q2 2022, and adjusted EBITDA of $(3.9) million, a 122% decrease from Q3 2021 and a 379% decrease from Q2 2022 on throughput of 561,906 tonnes and metal production of 16.6 million copper equivalent pounds for the three-month period ended September 30, 2022.
Luis Marchese, CEO of Sierra Metals, commented, “the unexpected events during our latest quarter have made for another challenging period at Sierra Metals.
We have all been deeply impacted by the tragic mudslide incident at Yauricocha. As our primary objective remains the safety and well-being of all employees and contractors, a rigorous safety assurance process continues at the mine. Although production is ramping up, full production can only be reached once this process is complete.
In the coming months, we will continue to incorporate ore from the high-grade Fortuna zone and work towards recovery of tonnage at the Yauricocha Mine. In addition, exploration efforts will continue, both inside the mine for near term reach and in brownfield locations in close proximity to operations, in order to generate new exploration targets.”
He continued, “at Bolivar, unexpected flooding during most of the quarter in addition to the operational restrictions due to limited ventilation at the Bolivar NorthWest zone, negatively impacted throughput and grades.
On a consolidated basis, the Company’s revenues and EBITDA decreased 36% and 122%, respectively due to a 24% decrease in copper equivalent production when compared to the same quarter last year, coupled with a reduction in all metals prices, except zinc.”
He concluded, “Recent setbacks at both the Yauricocha and Bolivar Mines have prevented us from achieving full production and our turnaround goals within the initially proposed timeline, leading to suspended 2022 operating guidance. These unexpected challenges have culminated in the liquidity issues facing the Company. The Special Committee of our Board diligently continues its strategic review process. In the meantime, we remain disciplined in our approach to day-to-day operations.”
The following table displays selected financial and operational information for the three months and nine months ended September 30, 2022 compared to the corresponding periods for 2021 and the three months ended June 30, 2022:
The following table shows the Company’s realized selling prices for the three months ended September 30, 2022, and each of the last six quarters:
Q3 2022 Consolidated Operating Highlights
Copper equivalent production of 16.6 million pounds; a 24% decrease from Q3 2021 and a 7% decrease from Q2 2022.
Consolidated Q3 2022 throughput of 561,906 tonnes was a 25% decrease over the Q3 2021 throughput of 750,208 tonnes. As compared to Q2 2022, consolidated throughput was 12% lower for Q3 2022.
Throughput from the Yauricocha Mine during Q3 2022 was 269,057 tonnes, a 17% decline when compared to Q3 2021 due to the suspension of mining activity and work stoppages during the quarter, which resulted in a 31% decrease in copper equivalent pounds produced. Declining grades due to restricted access to non-permitted areas of the mine also affected production. When compared to the previous quarter, throughput declined by 15%.
At the Bolivar Mine, throughput was 227,669 tonnes during Q3 2022. When compared to Q3 2021, throughput at Bolivar was 38% lower and while grades were higher for silver and gold, they were not enough to offset the lower throughput, resulting in a 16% decrease in copper equivalent pounds produced. Operational ramp up has been slower than expected due to unforeseen flooding in the Bolivar NorthWest zone during the quarter. When compared to Q2 2022, an 11% decrease in throughput, along with lower grades in copper and silver, resulted in a 10% decrease in copper equivalent pound production.
At Cusi, throughput was 65,180 tonnes during Q3 2022. When compared to Q3 2021, a 7% increase in throughput, combined with higher head grades for all metals except lead, resulted in a 22% increase in silver equivalent ounces production. Cusi suffered from an unexpected flooding event that restricted access to the lower areas of the mine during the second quarter. At the beginning of Q3, access to the lower levels of the mine was still limited. While throughput was 2% lower, it was offset by higher grades in all metals, resulting in a 32% increase in silver equivalent ounces produced.
Q3 2022 Consolidated Financial Highlights
Revenues Declined Due to Decrease in Metal Sales and a Drop in Metals Prices
Revenue from metals payable of $38.8 million in Q3 2022 or a decrease of 36% over the revenue of $60.7 million in Q3 2021 due to the decrease in metal sales and the drop in average realized prices for all metals, except zinc, as compared to Q3 2021.
Revenues for Q3 2022 were 22% lower than the revenue of $49.9 million in Q2 2022, as lower production from the Yauricocha and Bolivar Mines impacted metal sales quantities. The average realized prices for Q3 2022 decreased for copper (18%), zinc (17%), lead (10%), silver (15%) and gold (8%) as compared to the same during Q2 2022.
Cost of Operations Increased at Yauricocha and Bolivar Due to Lower Throughput
Yauricocha’s cash cost per copper equivalent payable pound was $2.01 (Q3 2021 – $1.37), and AISC (as defined herein) per copper equivalent payable pound of $3.36 (Q3 2021 – $2.83) for Q3 2022. The increase in cash costs and AISC was mainly a result of the 25% decrease in copper equivalent payable pounds as compared to Q3 2021. Despite 14% fewer copper equivalent payable pounds in Q3 2022 as compared to Q2 2022, cash cost and AISC per copper equivalent pound decreased from $2.06 and $3.39 respectively in Q2 2022, due to lower cost of sales and sustaining costs.
Bolivar’s cash cost per copper equivalent payable pound was $3.38 (Q3 2021 – $2.02), and AISC per copper equivalent payable pound was $5.12 (Q3 2021 – $4.34) for Q3 2022 due to higher operating costs per tonne and an 8% decrease in the copper equivalent payable pounds compared to Q3 2021. Bolivar’s Q3 2022 cash cost and AISC per copper equivalent pound decreased however from $3.39 and $5.49 respectively in Q2 2022.
Cusi’s Q3 2022 cash cost per silver equivalent payable ounce decreased to $14.58 from $17.06 in Q3 2021 as a result of higher grades. AISC per silver equivalent payable ounce decreased to $19.23 (Q3 2021 – $28.93). Unit costs decreased during Q3 2022, despite fewer silver equivalent payable ounces, as a result of lower operating costs per tonne and lower sustaining costs during Q3 2022 as compared to Q3 2021.
EBITDA, Net Income and Cash Flow Generation Impacted by Lower Revenues and Higher Operating Costs
Adjusted EBITDA(1) decreased 122% to $(3.9) million for Q3 2022 compared to $17.4 million in Q3 2021 and a 379% decrease compared to $1.4 million in the previous quarter. The decrease in EBITDA is related to drop in revenues attributable to lower production and higher operating costs during Q3 2022.
Net loss attributable to shareholders for Q3 2022 was $46.2 million or $(0.28) per share (basic and diluted), compared to net loss of $4.8 million or $(0.03) per share (basic and diluted) in Q3 2021 and net loss of $15.3 million or $(0.09) per share (basic and diluted) in Q2 2022.
Adjusted net loss attributable to shareholders(1) of $10.7 million, or $(0.07) per share for Q3 2022, compared to adjusted net loss of $1.7 million or $(0.01) per share for Q3 2021 and adjusted net loss of $11.6 million, or $0.0 per share for Q2 2022.
Operating cash flow before movements in working capital of $(6.8) million for Q3 2022 as compared to $15.1 million of cash generated from operating activities in Q3 2021 and $(1.6) million in Q2 2022. The decrease resulted from lower revenue and higher costs during the quarter.
Cash and cash equivalents of $13.7 million and working capital of $(52.3) million as at September 30, 2022 compared to $34.9 million and $17.3 million, respectively, at the end of 2021. The negative working capital is largely the result of the reclassification of the long-term portion of the credit facility to current, as the Company defaulted on certain debt covenants as of September 30, 2022. The Company is seeking accommodation from the lending banks in the form of waivers for this non-compliance. If the Company is unable to obtain such waivers for the current and any potential future breaches of its debt covenants, it could materially and adversely affect the Company’s future operations, cash flows, earnings, results of operations, financial condition and the economic viability of its projects.
Cash and cash equivalents decreased during the nine-month period ended September 30, 2022 due to $31.2 million used in investing activities offset by $6.1 million of cash generated from operating activities and $3.8 million of cash generated from financing activities.
Financing activities included $25.0 million received from Banco de Credito del Peru (“BCP”) and Banco Santander by the Company’s subsidiary, Sociedad Minera Corona, to finance the repayment of the installments of $18.8 million on the original credit facility received from BCP.
1 This is a non-IFRS performance measure. See the Non-IFRS Performance Measures section of the MD&A.
Project Development
Mine development at Bolivar during Q3 2022 totaled 2,080 meters, which included 1,265 meters of development to prepare stopes for mine production, and 815 meters to development of ramps; and
Mine development at Cusi during Q3 2022 totaled 631 meters.
Exploration Update
Peru:
Approximately 2,532 meters of diamond drilling was completed during Q3 2022 in the Fortuna North, Katty and Violeta zones with the aim to replace and increase the depleted mineral resources. Additionally, approximately 2,000 meters of greenfield exploration drilling was completed in the Tucumachay prospect.
Mexico:
Bolivar
At Bolivar during Q3 2022, 18,318 meters were drilled in the Bolivar West, Bolivar NorthWest, the Cieneguita zones and El Gallo Superior encountering skarn intersections with mineralization. Additionally, infill drilling of 4,479 meters was completed in the Bolivar West, El Gallo Inferior and Bolivar NorthWest zones;
Cusi
During Q3 2022, the Company completed 2,196 meters of infill drilling to support the development of the Santa Rosa de Lima vein and NE Trend.
Covid-19 Update And Outlook
The COVID-19 pandemic has impacted the Company’s operations over the past two years. While there are still concerns regarding the newer variants of the virus, there is reduced pressure on the operations due to relaxed measures as the Company has achieved almost 100% vaccination rate for its employees at all locations. The additional costs related to COVID dropped to $1.7 million during the nine-month period ended September 30, 2022 as compared to $8.0 million spent during the comparative nine-month period of 2021.
Impairment Charge
Lower market capitalization due to the drop in the Company’s share price, declining metal prices, lower production and consequent decrease in profitability were considered as indicators of impairment as on September 30, 2022. The Company performed an impairment analysis for each of its cash generating units (“CGU”) using Life of Mine (“LOM”), which incorporate current operational practices, long term metal prices based on recent analyst consensus and productivity assumptions, based on recent operating experience at the mines.
The Company updated the Bolivar LOM using updated information from the mine performance, required capex, metal prices and discount rate, and concluded that an impairment of $25.0 million was required for the Bolivar CGU.
The Cusi LOM was updated for the latest metal prices and discount rate. Following this analysis, management concluded that an impairment of $7.0 million was needed for the Cusi CGU as on September 30, 2022.
The updated Yauricocha LOM did not indicate any impairment as at September 30, 2022.
Suspended Guidance
In addition to the delays in the anticipated turnaround at the Bolivar mine due to the unexpected flooding in the Bolivar NW zone during the quarter, the Company also experienced production delays at the Yauricocha mine as a result of the mudslide incident and ensuing community blockade in September. Although mining restarted in parts of Yauricocha in October, the Company is following due assurance processes to ensure safe operations in the remaining sections of the mine. In view of these delays, the Company has suspended its production and financial guidance for 2022.
Strategic Review Process
In response to liquidity challenges from an accumulation of operational losses and negative cashflows, primarily from its Mexican operations, the Company announced, on October 18, 2022, the formation of a Special Committee and the initiation of a strategic review process.
The mandate of the Special Committee, comprised of its independent directors, includes exploring, reviewing and considering options to optimize the operations of the Company and possible financing, restructuring and strategic options in the best interests of the Company. Financial and legal advisors with particular expertise in turnaround and restructuring matters have been engaged to advise on this process.
The Company has engaged CIBC Capital Markets as a financial advisor in this process.
Delisting
As previously announced, the Company will voluntarily delist its common shares from the New York Stock Exchange American (“NYSE”) and the Bolsa de Valores de Lima (“BVL”). The final day of trading on the NYSE was today, November 14, 2022 with shares to be suspended from trading before market open on November 15, 2022.
The Company is continuing to pursue its BVL delisting and suspension from trading is anticipated later during the year. An update will be provided once a final trading date of the common shares on the BVL has been confirmed.
The Company’s common shares will continue to be listed and traded in Canadian dollars on the Toronto Stock Exchange.
Conference Call and Webcast
Sierra Metals’ senior management will host a conference call on Tuesday, November 15, 2022, at 11:00 AM (EDT) to discuss the Company’s financial and operating results for the three months ended September 30, 2022.
Via Webcast:
A live audio webcast of the meeting will be available on the Company’s website:
The webcast, along with presentation slides, will be archived for 180 days on www.sierrametals.com.
Via phone:
For those who prefer to listen by phone, dial-in instructions are below. To ensure your participation, please call approximately five minutes prior to the scheduled start time of the call.
Canada dial-in number (Toll Free): 1 833 950 0062 Canada dial-in number (Local): 1 226 828 7575 US dial-in number (Toll Free): 1 844 200 6205 US dial-in number (Local): 1 646 904 5544 All other locations: +1 929 526 1599
Access code: 991150
Press *1 to ask a question, *2 to withdraw your question, or *0 for operator assistance
Non-IFRS Performance Measures
The non-IFRS performance measures presented do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be directly comparable to similar measures presented by other issuers.
Non-IFRS reconciliation of adjusted EBITDA
EBITDA is a non-IFRS measure that represents an indication of the Company’s continuing capacity to generate earnings from operations before taking into account management’s financing decisions and costs of consuming capital assets, which vary according to their vintage, technological currency, and management’s estimate of their useful life. EBITDA comprises revenue less operating expenses before interest expense (income), property, plant and equipment amortization and depletion, and income taxes. Adjusted EBITDA has been included in this document. Under IFRS, entities must reflect in compensation expense the cost of share-based payments. In the Company’s circumstances, share-based payments involve a significant accrual of amounts that will not be settled in cash but are settled by the issuance of shares in exchange for cash. As such, the Company has made an entity specific adjustment to EBITDA for these expenses. The Company has also made an entity-specific adjustment to the foreign currency exchange (gain)/loss. The Company considers cash flow before movements in working capital to be the IFRS performance measure that is most closely comparable to adjusted EBITDA.
The following table provides a reconciliation of adjusted EBITDA to the condensed interim consolidated financial statements for the three and nine months ended September 30, 2022 and 2021:
Non-IFRS reconciliation of adjusted net income
The Company has included the non-IFRS financial performance measure of adjusted net income, defined by management as the net income attributable to shareholders shown in the statement of earnings plus the non-cash depletion charge due to the acquisition of Corona and the corresponding deferred tax recovery and certain non-recurring or non-cash items such as share-based compensation and foreign currency exchange (gains) losses. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors may want to use this information to evaluate the Company’s performance and ability to generate cash flows. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance in accordance with IFRS.
The following table provides a reconciliation of adjusted net income to the condensed interim consolidated financial statements for the three and nine months ended September 30, 2022 and 2021:
Cash cost per silver equivalent payable ounce and copper equivalent payable pound
The Company uses the non-IFRS measure of cash cost per silver equivalent ounce and copper equivalent payable pound to manage and evaluate operating performance. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate cash flows. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
All-in sustaining cost per silver equivalent payable ounce and copper equivalent payable pound
All‐In Sustaining Cost (“AISC”) is a non‐IFRS measure and was calculated based on guidance provided by the World Gold Council (“WGC”) in June 2013. WGC is not a regulatory industry organization and does not have the authority to develop accounting standards for disclosure requirements. Other mining companies may calculate AISC differently as a result of differences in underlying accounting principles and policies applied, as well as differences in definitions of sustaining versus development capital expenditures.
AISC is a more comprehensive measure than cash cost per ounce/pound for the Company’s consolidated operating performance by providing greater visibility, comparability and representation of the total costs associated with producing silver and copper from its current operations.
The Company defines sustaining capital expenditures as, “costs incurred to sustain and maintain existing assets at current productive capacity and constant planned levels of productive output without resulting in an increase in the life of assets, future earnings, or improvements in recovery or grade. Sustaining capital includes costs required to improve/enhance assets to minimum standards for reliability, environmental or safety requirements. Sustaining capital expenditures excludes all expenditures at the Company’s new projects and certain expenditures at current operations which are deemed expansionary in nature.”
Consolidated AISC includes total production cash costs incurred at the Company’s mining operations, including treatment and refining charges and selling costs, which forms the basis of the Company’s total cash costs. Additionally, the Company includes sustaining capital expenditures and corporate general and administrative expenses. AISC by mine does not include certain corporate and non‐cash items such as general and administrative expense and share-based payments. The Company believes that this measure represents the total sustainable costs of producing silver and copper from current operations and provides the Company and other stakeholders of the Company with additional information of the Company’s operational performance and ability to generate cash flows. As the measure seeks to reflect the full cost of silver and copper production from current operations, new project capital and expansionary capital at current operations are not included. Certain other cash expenditures, including tax payments, dividends and financing costs are also not included.
Additional non-IFRS measures
The Company uses other financial measures, the presentation of which is not meant to be a substitute for other subtotals or totals presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. This includes:
Operating cash flows before movements in working capital – excludes the movement from period-to-period in working capital items including trade and other receivables, prepaid expenses, deposits, inventories, trade and other payables and the effects of foreign exchange rates on these items.
This term does not have a standardized meaning prescribed by IFRS, and therefore the Company’s definition is unlikely to be comparable to similar measures presented by other companies. The Company’s management believes that their presentation provides useful information to investors because cash flows generated from operations before changes in working capital excludes the movement in working capital items. This, in management’s view, provides useful information of the Company’s cash flows from operations and is considered to be meaningful in evaluating the Company’s past financial performance or its future prospects. The most comparable IFRS measure is cash flows from operating activities.
Qualified Persons
Américo Zuzunaga, FAusIMM (Mining Engineer) Vice President, Technical is a Qualified Person under National Instrument 43-101 – Standards of Disclosure for Mineral Projects.
About Sierra Metals
Sierra Metals Inc. is a diversified Canadian mining company with Green Metal exposure including increasing copper production and base metal production with precious metals byproduct credits, focused on the production and development of its Yauricocha Mine in Peru, and Bolivar and Cusi Mines in Mexico. The Company is focused on increasing production volume and growing mineral resources. Sierra Metals has recently had several new key discoveries and still has many more exciting brownfield exploration opportunities at all three Mines in Peru and Mexico that are within close proximity to the existing mines. Additionally, the Company also has large land packages at all three mines with several prospective regional targets providing longer-term exploration upside and mineral resource growth potential.
The Company’s Common Shares trade on the Bolsa de Valores de Lima and on the Toronto Stock Exchange under the symbol “SMT” and on the NYSE American Exchange under the symbol “SMTS”.
For further information regarding Sierra Metals, please visit www.sierrametals.com.
This press release contains forward-looking information within the meaning of Canadian and United States securities legislation, including with respect to timing of the conference call, exploration and production plans and the delisting of the Company’s common shares. Forward-looking information relates to future events or the anticipated performance of Sierra and reflect management’s expectations or beliefs regarding such future events and anticipated performance based on an assumed set of economic conditions and courses of action. In certain cases, statements that contain forward-looking information can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, “believes” or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might”, or “will be taken”, “occur” or “be achieved” or the negative of these words or comparable terminology. By its very nature forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual performance of Sierra to be materially different from any anticipated performance expressed or implied by such forward-looking information.
Forward-looking information is subject to a variety of risks and uncertainties, which could cause actual events or results to differ from those reflected in the forward-looking information, including, without limitation, the risks described under the heading “Risk Factors” in the Company’s annual information form dated March 16, 2022 for its fiscal year ended December 31, 2021 and other risks identified in the Company’s filings with Canadian securities regulators and the United States Securities and Exchange Commission, which filings are available at www.sedar.com and www.sec.gov, respectively.
The risk factors referred to above are not an exhaustive list of the factors that may affect any of the Company’s forward-looking information. Forward-looking information includes statements about the future and is inherently uncertain, and the Company’s actual achievements or other future events or conditions may differ materially from those reflected in the forward-looking information due to a variety of risks, uncertainties and other factors. The Company’s statements containing forward-looking information are based on the beliefs, expectations, and opinions of management on the date the statements are made, and the Company does not assume any obligation to update such forward-looking information if circumstances or management’s beliefs, expectations or opinions should change, other than as required by applicable law. For the reasons set forth above, one should not place undue reliance on forward-looking information.
Global Restaurant Franchising Company HiresExperienced C-Suite Growth Leader to Drive Expansion Efforts
LOS ANGELES, Nov. 14, 2022 (GLOBE NEWSWIRE) — FAT (Fresh. Authentic. Tasty.) Brands Inc., announces the hiring of its first Chief Growth Officer, Jeremy Theisen. Theisen joins FAT Brands with over 20 years of experience in significantly increasing the revenue stream for high-growth start-ups in the restaurant sector and will be focused on spearheading the growth of the development pipeline across the FAT Brands portfolio. This includes bringing new franchisees into the system and driving multi-unit expansion with existing franchisees.
Prior to joining FAT Brands, Theisen served as Chief Revenue Officer of PathSpot, a hygiene management system geared towards the foodservice industry, where he not only grew the company’s contracted revenue by 15 times in 24 months, but also, was key in their overseas expansion in Europe and Australia. Theisen also served as Chief Sales Officer of Punchh, the restaurant industry leader in loyalty and engagement programs, where he saw the company through its launch to generating $50 million in revenue prior to being acquired by Par Technology Corporation several years later. Other experiences include Google and Truaxis, a loyalty rewards and personalized statement solutions company owned by MasterCard.
“Over the last several years, FAT Brands continues to reach new heights from a growth perspective,” said FAT Brands CEO Andy Wiederhorn. “While our acquisition strategy has been a key mechanism for growth, we have also been heavily invested in building out our deep, organic pipeline. This year has already been record-breaking from an opening standpoint, and we are just getting started. Jeremy is a great addition to our team to drive this growth forward exponentially in the years to come. His experience of quickly scaling companies from start-ups to industry leaders aligns with our fast-paced growth mentality.”
“I am excited for the new journey ahead at FAT Brands,” said Jeremy Theisen. “I have had the pleasure of working with the company while at my other ventures and have been amazed at the growth they have achieved. What was once Fatburger has now transformed into a 17-concept portfolio with a strong worldwide presence. I look forward to adding to the already strong growth trajectory of the company and forging new relationships with new and existing franchisees.”
FAT Brands (NASDAQ: FAT) is a leading global franchising company that strategically acquires, markets, and develops fast casual, quick-service, casual dining, and polished casual dining concepts around the world. The Company currently owns 17 restaurant brands: Round Table Pizza, Fatburger, Marble Slab Creamery, Johnny Rockets, Fazoli’s, Twin Peaks, Great American Cookies, Hot Dog on a Stick, Buffalo’s Cafe & Express, Hurricane Grill & Wings, Pretzelmaker, Elevation Burger, Native Grill & Wings, Yalla Mediterranean and Ponderosa and Bonanza Steakhouses, and franchises and owns over 2,300 units worldwide.
HOUSTON, Nov. 14, 2022 /PRNewswire/ — Direct Digital Holdings, Inc. (Nasdaq: DRCT) (“Direct Digital Holdings” or the “Company”), a leading advertising and marketing technology platform operating through its companies Colossus Media, LLC (“Colossus SSP”), Huddled Masses LLC (“Huddled Masses”) and Orange142, LLC (“Orange142”), today announced that the Company will be participating in the ROTH 11th Annual Technology Event taking place on November 16, 2022 at The Yale Club in New York, NY.
Keith Smith, President of Direct Digital Holdings, and Susan Echard, Chief Financial Officer of Direct Digital Holdings, will be attending on behalf of the Company and available for meetings during the conference. For more information, or to schedule a meeting with management, please reach out to your ROTH representative.
About Direct Digital Holdings Direct Digital Holdings (Nasdaq: DRCT), owner of operating companies Colossus SSP, Huddled Masses, and Orange 142, brings state-of-the-art sell- and buy-side advertising platforms together under one umbrella company. Direct Digital Holdings’ sell-side platform, Colossus SSP, offers advertisers of all sizes extensive reach within general market and multicultural media properties. The company’s subsidiaries Huddled Masses and Orange142 deliver significant ROI for middle market advertisers by providing data-optimized programmatic solutions at scale for businesses in sectors that range from energy to healthcare to travel to financial services. Direct Digital Holdings’ sell- and buy-side solutions manage approximately 90,000 clients monthly, generating over 100 billion impressions per month across display, CTV, in-app and other media channels. The company has been named a top minority-owned business by The Houston Business Journal.
Completed enrollment in the Phase 1 study with novel, broad-spectrum antiviral PB2 candidate CC-42344 for the treatment of pandemic and seasonal influenza A; remains on track to report topline results in 2022
Announced oral presentation of CC-42344 Phase 1 influenza A data at the World Antiviral Congress 2022 being held in December
Selected novel antiviral candidate CDI-988 for clinical development as an oral treatment for SARS-CoV-2 with Phase 1 study expected to begin in the first quarter of 2023
BOTHELL, Wash., Nov. 14, 2022 (GLOBE NEWSWIRE) — Cocrystal Pharma, Inc. (Nasdaq: COCP) reports financial results for the three and nine months ended September 30, 2022, and provides updates on its antiviral pipeline, upcoming milestones and business activities.
“We are reporting continued progress in advancing our highly promising antiviral portfolio,” said Sam Lee, Ph.D., President and co-interim CEO of Cocrystal. “With enrollment completed in our CC-42344 Phase 1 study for the treatment of pandemic and seasonal influenza A, we are on track to report topline safety and pharmacokinetic (PK) results later this year. The full trial results will be a key component of UK regulatory agency submission for our influenza A Phase 2a human challenge study. Subject to the agency’s review and clearance of our submission, we expect Phase 2a study initiation in the second half of 2023.
“We advanced our oral COVID-19 program with the selected the novel, broad-spectrum protease inhibitor CDI-988 as our lead development candidate,” he added. “We are conducting IND-enabling toxicology studies with CDI-988 and plan to file for regulatory clearance to begin a first-in-human trial in Australia in the first quarter of 2023. Preclinical development activities are ongoing in our norovirus program with plans to select a lead candidate in the first half of 2023.”
“The recent increase in patients hospitalized with viral disease particularly among the pediatric population underscores the need for effective, broad-spectrum antivirals and provides rationale for our approach in developing candidates with barriers to drug resistance,” said James Martin, CFO and co-interim CEO. “We continue to be well positioned to execute on our clinical and regulatory goals given our clean capital structure, cost-efficient business model and a cash balance we believe is sufficient to fund planned operations for the next three years. That said, we continue to pursue non-dilutive funding to further support development of our promising antiviral programs.”
Antiviral Product Pipeline Overview
Many commercial antiviral drugs are only effective against certain strains of a virus and are less effective or not effective at all against other strains or variants. Cocrystal is developing novel drug candidates that specifically target proteins involved in viral replication. Despite the numerous strains that may exist or emerge, these targeted enzymes are required for viral replication and are essentially similar (highly conserved) across all strains. By targeting these highly conserved regions of the replication enzymes, our antiviral compounds are designed to be effective against major virus strains.
COVID-19 and Other Coronavirus Programs By targeting viral replication enzymes and protease, we believe it is possible to develop an effective treatment for all coronavirus diseases including COVID-19, Severe Acute Respiratory Syndrome (SARS) and Middle East Respiratory Syndrome (MERS). Our main SARS-CoV-2 protease inhibitors showed potent in vitro pan-viral activity against common human coronaviruses, rhinoviruses and respiratory enteroviruses that cause the common cold, as well as against noroviruses that can cause symptoms of acute gastroenteritis.
During 2022 Cocrystal entered into two agreements with the National Institute of Allergy and Infectious Diseases (NIAID) for exploratory preclinical studies to evaluate our 3CL protease inhibitors for the treatment of COVID-19. The NIAID collaboration announced in April 2022 for in vitro and in vivo studies evaluating the antiviral activity of our compounds has been successfully completed. In June 2022 we expanded our collaboration with the NIAID with a second agreement in which we provided our proprietary process chemistry information for oral 3CL protease inhibitors to the NIAID to support scale-up synthesis of a key intermediate of these compounds. This collaboration is ongoing.
Oral Protease Inhibitor CDI-988
We selected CDI-988 as our lead candidate for development as a potential oral treatment for SARS-CoV-2. CDI-988, which was designed and developed using our proprietary structure-based drug discovery platform technology, targets a highly conserved region in the active site of SARS-CoV-2 3CL (main) protease required for viral RNA replication.
CDI-988 exhibits superior in vitro potency against SARS-CoV-2 with activity maintained against current variants of concern, and demonstrated a safety profile and PK properties that are supportive of daily dosing.
We are currently conducting good laboratory practice (GLP) toxicology studies in preparation for a Phase 1 study.
We plan to initiate a Phase 1 study in the first quarter of 2023. We believe the FDA’s guidance for further development of our antiviral candidate CDI-45205 (described below) provides us with a clearer pathway for our planned Phase 1 study with CDI-988, as well as directives for designing a subsequent Phase 2 study.
Intranasal/Pulmonary Protease Inhibitor CDI-45205
An IND-enabling study is ongoing with CDI-45205, our novel SARS-CoV-2 3CL (main) protease inhibitor being developed as a potential treatment for COVID-19 and its variants.
We received guidance from the FDA regarding further preclinical and clinical development of CDI-45205 that provides a clearer pathway for future clinical development.
CDI-45205 and several analogs showed potent in vitro activity against the main SARS-CoV-2 variants to date including the Omicron variant, surpassing the activity observed with the original Wuhan strain.
CDI-45205 demonstrated good bioavailability in mouse and rat PK studies via intraperitoneal injection, and no cytotoxicity against a variety of human cell lines. CDI-45205 also demonstrated a strong synergistic effect with the FDA-approved COVID-19 medicine remdesivir.
CDI-45205 was among the broad-spectrum viral protease inhibitors we obtained from Kansas State University Research Foundation (KSURF) under an exclusive license agreement announced in April 2020. We believe the protease inhibitors obtained from KSURF have the ability to inhibit the inactive SARS-CoV-2 polymerase replication enzymes into an active form.
Replication Inhibitors
We are using our proprietary structure-based drug discovery platform technology to discover replication inhibitors for orally administered therapeutic and prophylactic treatments for SARS-CoV-2. Replication inhibitors hold potential to work with protease inhibitors in a combination therapy regimen.
InfluenzaPrograms Influenza is a severe respiratory illness caused by either the influenza A or B virus that results in outbreaks of disease mainly during the winter months.
Pandemic and Seasonal Influenza A
A novel PB2 inhibitor, CC-42344 has shown excellent antiviral activity against influenza A strains including pandemic and seasonal strains, as well as strains resistant to Tamiflu® and Xofluza®. CC-42344 also has favorable PK and drug-resistance profiles.
In March 2022 we initiated enrollment in our randomized, double-controlled, dose-escalating Phase 1 study to evaluate the safety, tolerability and pharmacokinetics of orally administered CC-42344 in healthy adults.
In April 2022 we announced preliminary Phase 1 study data, demonstrating a favorable safety and PK profile in the first two cohorts administered single ascending doses of CC-42344 at 100 mg and 200 mg.
In July 2022 we reported PK results from the single ascending dose of the study supporting once-daily dosing.
In November 2022 we announced the Phase 1 study had reached full enrollment and reiterated our expectation to report topline results in 2022.
We entered into an agreement with a UK-based clinical research organization to conduct a human challenge Phase 2a study evaluating safety, viral and clinical measures of orally administered CC-42344 in influenza A-infected subjects. Under the human challenge model, healthy adults will be infected with the influenza A virus under carefully controlled conditions, which we believe will hasten trial enrollment and ensure subjects are infected with influenza A.
We expect to submit an application with the United Kingdom Medicines and Healthcare Products Regulatory Agency in early 2023 to conduct a human challenge Phase 2a study. Pending clearance by the agency, we expect to initiate the study in the second half of 2023.
Pandemic and Seasonal Influenza A/B Program
In January 2019 we entered into an Exclusive License and Research Collaboration Agreement with Merck Sharp & Dohme Corp. (Merck) to discover and develop certain proprietary influenza antiviral agents that are effective against both influenza A and B strains. This agreement includes milestone payments of up to $156 million plus royalties on sales of products discovered under the agreement.
In January 2021 we announced completion of all research obligations under the agreement. Merck is now solely responsible for further preclinical and clinical development of compounds discovered under this agreement, and continues development activities with the compounds discovered under this agreement.
In April 2022 Merck indicated it was continuing development of the compounds discovered under this agreement.
Norovirus Program
We are developing certain proprietary broad-spectrum, non-nucleoside polymerases for the treatment of human norovirus infections using our proprietary structure-based drug design technology platform. We also hold exclusive rights to norovirus protease inhibitors for use in humans under the KSURF license.
We are targeting the selection of a preclinical lead in the first half of 2023.
Norovirus is a global public health problem responsible for nearly 90% of epidemic, non-bacterial outbreaks of gastroenteritis around the world.
Hepatitis C Program
We are seeking a partner to advance the development of CC-31244 following the successful completion of a Phase 2a study. This compound has shown favorable safety and preliminary efficacy in a triple-regimen Phase 2a study in combination with Epclusa (sofosbuvir/velpatasvir) for the ultra-short duration treatment of individuals infected with the hepatitis C virus (HCV).
HCV is a viral infection of the liver that causes both acute and chronic infection. In June 2022, the World Health Organization estimates that 58 million people worldwide have chronic HCV infections.
Third Quarter Financial Results
Research and development (R&D) expenses for the third quarter of 2022 were $3.9 million compared with $2.1 million for the third quarter of 2021, with the increase primarily due to the ongoing influenza A Phase 1 trial and advancement of the preclinical COVID-19 program. The Company anticipates higher R&D spending during the remainder of 2022 in preparation for additional clinical trials. General and administrative (G&A) expenses were $1.8 million for the third quarters of both 2022 and 2021.
The net loss for the third quarter of 2022 was $5.7 million, or $0.70 per share, compared with the net loss for the third quarter of 2021 of $3.9 million, or $0.48 per share.
Nine Month Financial Results
R&D expenses for the first nine months of 2022 were $9.1 million compared with $6.1 million for the first nine months of 2021. G&A expenses were $4.5 million for the first nine months of both 2022 and 2021.
The net loss for the first nine months of 2022 was $34.3 million, or $4.23 per share, and included the items described above. The net loss for the first nine months of 2021 was $10.5 million, or $1.44 per share.
Cocrystal reported unrestricted cash of $42.1 million as of September 30, 2022 compared with $58.7 million as of December 31, 2021. Net cash used in operating activities for the first nine months of 2022 was $16.5 million. The Company reported working capital of $43.3 million with 8.1 million common shares outstanding as of September 30, 2022.
About Cocrystal Pharma, Inc.
Cocrystal Pharma, Inc. is a clinical-stage biotechnology company discovering and developing novel antiviral therapeutics that target the replication process of influenza viruses, coronaviruses (including SARS-CoV-2), hepatitis C viruses and noroviruses. Cocrystal employs unique structure-based technologies and Nobel Prize-winning expertise to create first- and best-in-class antiviral drugs. For further information about Cocrystal, please visit www.cocrystalpharma.com.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our goals of initiating a Phase 1 study for our CDI-988 candidate in the first quarter of 2023, our expectations of reporting data from the Phase 1 clinical study of our CC-42344 candidate later in 2022 and timeline for filing with the UK regulatory agency and commencing a Phase 2a study in 2023, our plans to select a lead candidate for our norovirus program in the first half of 2023, the viability and efficacy of potential treatments for coronavirus and other diseases, expectations for the global market for therapeutics, our attempts to discover replication inhibitors, our ability to execute our clinical and regulatory goals, our expectations concerning R&D expenses, the expected sufficiency of our cash balance to fund our planned operations, our liquidity and our continued pursuit of non-dilutive funding. The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events. Some or all of the events anticipated by these forward-looking statements may not occur. Important factors that could cause actual results to differ from those in the forward-looking statements include, but are not limited to, the risks arising from the impact of COVID-19 (including long-term and pervasive effects of the virus), inflation, interest rate increases and the Ukraine war on our Company, our collaboration partners, and on the national and global economy, including manufacturing and research delays arising from raw materials and labor shortages, supply chain disruptions and other business interruptions including and adverse impacts on our ability to obtain raw materials and test animals as well as similar problems with our vendors and our current Contract Research Organization (CRO) and any future CROs and Contract Manufacturing Organizations, the results of the studies for CC-42344, the ability of our CROs to recruit volunteers for, and to proceed with, clinical studies, our reliance on Merck for further development in the influenza A/B program under the license and collaboration agreement, our and our collaboration partners’ technology and software performing as expected, financial difficulties experienced by certain partners, the results of future preclinical and clinical trials, general risks arising from clinical trials, receipt of regulatory approvals, regulatory changes, development of effective treatments and/or vaccines by competitors, including as part of the programs financed by the U.S. government, potential mutations in a virus we are targeting which may result in variants that are resistant to a product candidate we develop, and the outcome of our appeal of the summary judgment. Further information on our risk factors is contained in our filings with the SEC, including our Annual Report on Form 10-K for the year ended December 31, 2021. Any forward-looking statement made by us herein speaks only as of the date on which it is made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by law.
Announced preliminary PDS0101 efficacy and safety data for Phase 2 clinical studies led by The University of Texas MD Anderson Cancer Center (IMMUNOCERV) and The National Cancer Institute at SITC 2022
Announced successful end-of-Phase 2 meeting with FDA for VERSATILE-002, allowing preparation for a registrational trial
Company to host conference call and webcast today at 8:00 AM EST
FLORHAM PARK, N.J., Nov. 14, 2022 (GLOBE NEWSWIRE) — PDS Biotechnology Corporation (Nasdaq: PDSB), a clinical-stage immunotherapy company developing a growing pipeline of targeted immunotherapies for cancer and infectious disease, will discuss its financial results for the quarter ended September 30, 2022 and provide a business update on its conference call today.
Recent Business Highlights:
PDS0101 Lead Drug Candidate
VERSATILE-002 Phase 2 Clinical Trial
Hosted a key opinion leader roundtable discussion on current treatment of head and neck cancer, and how PDS0101 might fit into the treatment paradigm.
Announced a successful end-of-Phase 2 meeting with the U.S. Food and Drug Administration (FDA), allowing progression to a registrational trial for VERSATILE-002.
IMMUNOCERV Phase 2 Clinical Trial
Presented preliminary data on the clinical efficacy and safety of the combination of PDS0101 and chemoradiotherapy, as well as immunological correlates in the IMMUNOCERV Phase 2 trial being conducted at The University of Texas MD Anderson Cancer Center in locally, advanced cervical cancer at the Society for Immunotherapy of Cancer Conference (SITC) 2022.
NCI-led Triple Combination Phase 2 Clinical Trial
Presented data on immunological correlates associated with clinical benefit in patients with HPV-positive checkpoint inhibitor (CPI) refractory cancer treated with the PDS0101-based triple combination in the National Cancer Institute (NCI)-led Phase 2 clinical trial at the Society for Immunotherapy of Cancer Conference (SITC) 2022.
Reported expanded interim data for the Phase 2 PDS0101 based triple combination trial led by the NCI targeting advanced HPV-positive cancers.
Announced completion of recruitment into the NCI-led PDS0101-based triple combination Phase 2 trial, and also reported selection of the CPI refractory arm as the preferred patient group to target in a registrational study with the triple combination.
PDS0102 and PDS0103 Drug Candidates
Presented preclinical data on both PDS0102 and PDS0103, demonstrating the versatility of the Versamune® platform and generation of TARP and MUC1 specific polyfunctional CD8+ T cells presented at the American Association of Cancer Research (AACR) Special Conference: Tumor Immunology and Immunotherapy 2022.
PDS0202 Universal Flu Candidate
Presented data from the preclinical universal flu vaccine program at the American Society of Virology meeting, demonstrating the potential ability of PDS0202 to neutralize multiple strains of influenza in animals.
Financing
Entered into a venture loan and security agreement with Horizon Technology Finance Corporation, which provides PDS Biotech with up to $35 million in term loans.
“The third quarter has been monumental for PDS Biotech, and we continue to make strides towards commercialization of our lead candidate, PDS0101,” stated Dr. Frank Bedu-Addo, President and Chief Executive Officer of PDS Biotech. We’ve remained focused on progressing our four Phase 2 clinical programs, most recently, announcing data from our IMMUNOCERV trial in locally, advanced cervical cancer. 100% (9/9) of patients had a clinical response with tumor shrinkage of over 60% at the midpoint evaluation, and 89% (8/9) of patients had a complete response with no evidence of disease at day 170, when treated with a combination of PDS0101 and chemotherapy. Furthermore, we released expanded interim data from our NCI-led PDS0101-based triple combination trial demonstrating 66% (19/29) survival at median follow up of 16 months in checkpoint inhibitor refractory HPV-positive cancer patients that appears to show signs of clinical efficacy, durability, and safety, consistent with the data presented at the American Society for Clinical Oncology 2022. And, with VERSATILE-002 in which PDS0101 is combined with KEYTRUDA®, we are preparing for a registrational trial after our successful end-of-Phase 2 meeting with the FDA. To date, we have presented PDS0101 Phase 2 efficacy data in over 60 patients and safety data in over 100 patients.”
Matthew Hill, Chief Financial Officer of PDS Biotech, stated, “We are excited about the progress we have made in our development programs, and we have strengthened the balance sheet to support our ongoing efforts. This August, we increased our cash position by entering into a loan agreement with Horizon Technology Finance Corporation, where we received an initial tranche of $25 million in term loans. This financing provides PDS Biotech with the financial resources and runway needed to prepare for a registrational trial for our lead candidate, PDS0101, and to advance our preclinical pipeline.”
Third Quarter 2022 Financial Results Net loss for the three months ended September 30, 2022 was approximately $7.4 million, or $0.26 per basic share and diluted share, compared to a net loss of approximately $7.0 million, or $0.24 per basic and diluted share, for the three months ended September 30, 2021. The higher net loss reported for the three months ended September 2022 is primarily due to additional costs for expansion of the Company’s research and development, including costs associated with our ongoing clinical trials and additional general and administrative costs.
Research and development expenses increased to $4.4 million for the three months ended September 30, 2022 from $3.7 million for the three months ended September 30, 2021. The increase of $0.7 million in 2022 was primarily attributable to an increase of $0.2 million in clinical study and research costs, $0.3 million in personnel costs and $0.4 million in manufacturing services partially offset by a decrease of $0.2 million in professional fees and facilities.
General and administrative expenses decreased to $2.9 million for the three months ended September 30, 2022 from $3.3 million for the three months ended September 30, 2021. The decrease of $0.4 million is primarily attributable to a decrease of $0.5 million in personnel an increase of $0.2 million in professional fees partially offset by a decrease of $0.1 million in facilities costs.
Total operating expenses were approximately $7.3 million for the three months ended September 30, 2022, from approximately $7.0 million for the three months ended September 30, 2021.
PDS Biotech’s cash balance as of September 30, 2022 was approximately $71.6 million.
Conference Call and Webcast The conference call is scheduled to begin at 8:00 AM EST today, November 14, 2022. Participants should dial 877-407-3088 (United States) or 201-389-0927 (International) and reference conference ID 13733006. To access the webcast, please use the following link. The event will be archived in the investor relations section of PDS Biotech’s website for six months.
About PDS0101 PDS Biotech’s lead candidate, PDS0101, combines the utility of the Versamune® platform with targeted antigens in HPV-positive cancers. In partnership with Merck & Co., PDS Biotech is evaluating a combination of PDS0101 and KEYTRUDA® in a Phase 2 study in first-line treatment of recurrent or metastatic head and neck cancer, and also in second line treatment of recurrent or metastatic head and neck cancer in patients who have failed prior checkpoint inhibitor therapy. A Phase 2 clinical study is also being conducted in both second- and third-line treatment of multiple advanced HPV-positive cancers in partnership with the National Cancer Institute (NCI). A third Phase 2 clinical trial in first line treatment of locally advanced cervical cancer is being performed with The University of Texas, MD Anderson Cancer Center. A final Phase 2 clinical trial of PDS0101 monotherapy in first line treatment of newly diagnosed patients HPV16-positive head and neck cancer patients is being conducted at the Mayo Clinic.
KEYTRUDA® is a registered trademark of Merck Sharp and Dohme LLC, a subsidiary of Merck & Co., Inc., Rahway, NJ, USA.
About PDS Biotechnology PDS Biotech is a clinical-stage immunotherapy company developing a growing pipeline of targeted cancer and infectious disease immunotherapies based on our proprietary Versamune® and Infectimune™ T cell-activating technology platforms. We believe our targeted Versamune® based candidates have the potential to overcome the limitations of current immunotherapy by inducing large quantities of high-quality, potent polyfunctional tumor specific CD4+ helper and CD8+ killer T cells. To date, our lead Versamune® clinical candidate, PDS0101, has demonstrated the potential to reduce tumors and stabilize disease in combination with approved and investigational therapeutics in patients with a broad range of HPV-positive cancers in multiple Phase 2 clinical trials. Our Infectimune™ based vaccines have also demonstrated the potential to induce not only robust and durable neutralizing antibody responses, but also powerful T cell responses, including long-lasting memory T cell responses in pre-clinical studies to date. To learn more, please visit www.pdsbiotech.com or follow us on Twitter at @PDSBiotech.
Forward Looking Statements This communication contains forward-looking statements (including within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended) concerning PDS Biotechnology Corporation (the “Company”) and other matters. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current beliefs of the Company’s management, as well as assumptions made by, and information currently available to, management. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend,” “forecast,” “guidance”, “outlook” and other similar expressions among others. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: the Company’s ability to protect its intellectual property rights; the Company’s anticipated capital requirements, including the Company’s anticipated cash runway and the Company’s current expectations regarding its plans for future equity financings; the Company’s dependence on additional financing to fund its operations and complete the development and commercialization of its product candidates, and the risks that raising such additional capital may restrict the Company’s operations or require the Company to relinquish rights to the Company’s technologies or product candidates; the Company’s limited operating history in the Company’s current line of business, which makes it difficult to evaluate the Company’s prospects, the Company’s business plan or the likelihood of the Company’s successful implementation of such business plan; the timing for the Company or its partners to initiate the planned clinical trials for PDS0101, PDS0203 and other Versamune® and Infectimune™ based product candidates; the future success of such trials; the successful implementation of the Company’s research and development programs and collaborations, including any collaboration studies concerning PDS0101, PDS0203 and other Versamune® and Infectimune™ based product candidates and the Company’s interpretation of the results and findings of such programs and collaborations and whether such results are sufficient to support the future success of the Company’s product candidates; the success, timing and cost of the Company’s ongoing clinical trials and anticipated clinical trials for the Company’s current product candidates, including statements regarding the timing of initiation, pace of enrollment and completion of the trials (including the Company’s ability to fully fund its disclosed clinical trials, which assumes no material changes to our currently projected expenses), futility analyses, presentations at conferences and data reported in an abstract, and receipt of interim or preliminary results (including, without limitation, any preclinical results or data), which are not necessarily indicative of the final results of the Company’s ongoing clinical trials; any Company statements about its understanding of product candidates mechanisms of action and interpretation of preclinical and early clinical results from its clinical development programs and any collaboration studies; and other factors, including legislative, regulatory, political and economic developments not within the Company’s control, including record inflation, unforeseen circumstances or other disruptions to normal business operations arising from or related to COVID-19 and the ongoing military conflict between Russia and Ukraine. The foregoing review of important factors that could cause actual events to differ from expectations should not be construed as exhaustive and should be read in conjunction with statements that are included herein and elsewhere, including the risk factors included in the Company’s annual and periodic reports filed with the SEC. The forward-looking statements are made only as of the date of this press release and, except as required by applicable law, the Company undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise. Versamune® is a registered trademark and Infectimune™ is a trademark of PDS Biotechnology.
89% (8/9) had no evidence of disease (complete response) on day 170
Data Presented at Society for Immunotherapy of Cancer (SITC 2022)
FLORHAM PARK, N.J., Nov. 14, 2022 (GLOBE NEWSWIRE) — PDS Biotechnology Corporation (Nasdaq: PDSB), a clinical-stage immunotherapy company developing a growing pipeline of targeted immunotherapies for cancer and infectious disease, today announced that updated clinical data from the ongoing IMMUNOCERV Phase 2 clinical trial was presented during a poster session on November 11 at the 37th Annual Meeting for the Society for Immunotherapy of Cancer (SITC 2022). These data expand upon results detailed in the abstract submitted to SITC 2022 that was released to the public on November 7.
The enhanced data was presented in the poster titled, “IMMUNOCERV, an Ongoing Phase II Trial Combining PDS0101, an HPV-Specific T Cell Immunotherapy, with Chemotherapy and Radiation for Treatment of Locally Advanced Cervical Cancers,” which highlights key findings from The University of Texas MD Anderson Cancer Center-led IMMUNOCERV Phase 2 clinical trial (NCT04580771). The study is investigating PDS0101 in combination with standard-of-care chemoradiotherapy (CRT) for the potential treatment of cervical cancer in patients with large tumors over 5 cm in size and/or cancer that has spread to the lymph nodes (lymph node metastasis). New data from the study presented at SITC 2022 include:
9 of the 17 patients have now completed a day 170 post-treatment Positron Emission Tomography, Computed Tomography (PET CT) scan to assess the status of their cancer. This includes 78% (7/9) of treated patients with advanced cervical cancer (FIGO stage III or IV).
100% (9/9) of patients treated with the combination of PDS0101 and CRT had a clinical response with tumor shrinkage >60% at mid-point evaluation by MRI.
89% (8/9) of patients treated with the combination of PDS0101 and CRT demonstrated a complete response (CR) on day 170 by PET CT. One patient who received 3 of the 5 scheduled doses of PDS0101 showed signs of residual disease. One patient who had a CR died from an event unrelated to either their underlying disease or treatment.
1-year disease-free survival and 1-year overall survival of 89% (8/9) in patients treated with the combination of PDS0101 and CRT.
As previously reported, data confirm PDS0101 treatment activates HPV16-specific CD8+ T cells. This increase was not seen in patients who did not receive PDS0101. The increase in HPV16-specific T cells generated by the treatment is positively correlated with tumor cell death, suggesting cytotoxic CD8+ T cells are important mediators of antigen-specific immunity.
The data affirm that PDS0101 activates Type 1 interferon pathway in humans, mimicking the mechanism previously demonstrated in preclinical studies in animal models.
Toxicity of PDS0101 remains limited to low-grade local injection site reactions.
“The updated data from the ongoing IMMUNOCERV Phase 2 clinical trial presented during SITC 2022 add to the encouraging results observed thus far and suggest that the combination of PDS0101 and CRT may hold promise as a potential first-line treatment for advanced, localized cervical cancer,” said Dr. Frank Bedu-Addo, CEO of PDS Biotech. “Importantly, 100% of patients responded to treatment with the combination of PDS0101 and CRT. We believe this study also provides further confirmation that PDS0101 induces the right type, quality, and potency of killer T cells in humans that may translate to effective treatment of cervical cancer. We look forward to the continued advancement of the IMMUNOCERV Phase 2 clinical trial and the opportunity to report updated data during 2023.”
In addition, a second poster titled “Immune Correlates Associated with Clinical Benefit in Patients with Checkpoint Refractory HPV-Associated Malignancies Treated with Triple Combination Immunotherapy,” was presented at SITC 2022 and reported data from the Phase 2 triple combination trial being led by the Center for Cancer Research at the National Cancer Institute (NCI), part of the National Institutes of Health. The study is investigating PDS0101 in combination with two investigational immune-modulating agents: M9241, a tumor-targeting IL-12 (immunocytokine), and bintrafusp alfa, a bifunctional checkpoint inhibitor (PD-L1/ TGF-β). The triple combination is being studied in checkpoint inhibitor (CPI)-naïve and -refractory patients with advanced HPV-positive anal, cervical, head and neck, vaginal, and vulvar cancers who have failed prior therapy. For most patients who are CPI refractory, there is no effective therapy. The immune correlates before and after treatment in the CPI refractory patient population were studied. Highlights from the study presented at SITC 2022 included:
A more than two-fold increase in HPV16-specific T cells in the blood of 79% (11/14 tested) of the evaluated patients.
Increases on day 15 in several monitored immune correlates, such as granzyme B and interferon-gamma (IFN-γ), were associated with a clinical response.
Immune responses were associated with increases in natural killer cells, soluble granzyme B (associated with active killer T cells), IFN-γ, tumor necrosis factor-alpha (TNF-α), etc., two weeks after the first treatment cycle thus signaling a pro-inflammatory response.
These immunogenicity findings highlight the potential role of the combination in altering immune suppressive forces, and support previously announced results documenting promising clinical outcomes in the CPI-refractory population receiving the triple combination.
About PDS Biotechnology PDS Biotech is a clinical-stage immunotherapy company developing a growing pipeline of targeted cancer and infectious disease immunotherapies based on our proprietary Versamune® and Infectimune™ T cell-activating technology platforms. We believe our targeted Versamune® based candidates have the potential to overcome the limitations of current immunotherapy by inducing large quantities of high-quality, potent polyfunctional tumor-specific CD4+ helper and CD8+ killer T cells. To date, our lead Versamune® clinical candidate, PDS0101, has demonstrated the potential to reduce tumors and stabilize disease in combination with approved and investigational therapeutics in patients with a broad range of HPV-expressing cancers in multiple Phase 2 clinical trials. Our Infectimune™ based vaccines have also demonstrated the potential to induce not only robust and durable neutralizing antibody responses, but also powerful T cell responses, including long-lasting memory T cell responses in pre-clinical studies to date. To learn more, please visit www.pdsbiotech.com or follow us on Twitter at @PDSBiotech.
About PDS0101 PDS Biotech’s lead candidate, PDS0101, combines the utility of the Versamune® platform with targeted antigens in HPV-expressing cancers. In partnership with Merck & Co., PDS Biotech is evaluating a combination of PDS0101 and KEYTRUDA® in a Phase 2 study in first-line treatment of recurrent or metastatic head and neck cancer, and also in second-line treatment of recurrent or metastatic head and neck cancer in patients who have failed prior checkpoint inhibitor therapy. A National Cancer Institute-supported Phase 2 clinical study of PDS0101 in a triple combination therapy is also being conducted in checkpoint inhibitor refractory patients with multiple advanced HPV-associated cancers. A third Phase 2 clinical trial in first-line treatment of locally advanced cervical cancer is being led by The University of Texas MD Anderson Cancer Center. A final Phase 2 clinical trial of PDS0101 monotherapy in first-line treatment of newly diagnosed patients HPV16+ head and neck cancer patients is being conducted at the Mayo Clinic.
KEYTRUDA® is a registered trademark of Merck Sharp and Dohme LLC, a subsidiary of Merck & Co., Inc., Rahway, NJ, USA.
Forward Looking Statements This communication contains forward-looking statements (including within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended) concerning PDS Biotechnology Corporation (the “Company”) and other matters. These statements may discuss goals, intentions and expectations as to future plans, trends, events, results of operations or financial condition, or otherwise, based on current beliefs of the Company’s management, as well as assumptions made by, and information currently available to, management. Forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “may,” “will,” “should,” “would,” “expect,” “anticipate,” “plan,” “likely,” “believe,” “estimate,” “project,” “intend,” “forecast,” “guidance”, “outlook” and other similar expressions among others. Forward-looking statements are based on current beliefs and assumptions that are subject to risks and uncertainties and are not guarantees of future performance. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: the Company’s ability to protect its intellectual property rights; the Company’s anticipated capital requirements, including the Company’s anticipated cash runway and the Company’s current expectations regarding its plans for future equity financings; the Company’s dependence on additional financing to fund its operations and complete the development and commercialization of its product candidates, and the risks that raising such additional capital may restrict the Company’s operations or require the Company to relinquish rights to the Company’s technologies or product candidates; the Company’s limited operating history in the Company’s current line of business, which makes it difficult to evaluate the Company’s prospects, the Company’s business plan or the likelihood of the Company’s successful implementation of such business plan; the timing for the Company or its partners to initiate the planned clinical trials for PDS0101, PDS0203 and other Versamune® and Infectimune™ based product candidates; the future success of such trials; the successful implementation of the Company’s research and development programs and collaborations, including any collaboration studies concerning PDS0101, PDS0203 and other Versamune® and Infectimune™ based product candidates and the Company’s interpretation of the results and findings of such programs and collaborations and whether such results are sufficient to support the future success of the Company’s product candidates; the success, timing and cost of the Company’s ongoing clinical trials and anticipated clinical trials for the Company’s current product candidates, including statements regarding the timing of initiation, pace of enrollment and completion of the trials (including the Company’s ability to fully fund its disclosed clinical trials, which assumes no material changes to our currently projected expenses), futility analyses, presentations at conferences and data reported in an abstract, and receipt of interim or preliminary results (including, without limitation, any preclinical results or data), which are not necessarily indicative of the final results of the Company’s ongoing clinical trials; any Company statements about its understanding of product candidates mechanisms of action and interpretation of preclinical and early clinical results from its clinical development programs and any collaboration studies; and other factors, including legislative, regulatory, political and economic developments not within the Company’s control, including unforeseen circumstances or other disruptions to normal business operations arising from or related to COVID-19. The foregoing review of important factors that could cause actual events to differ from expectations should not be construed as exhaustive and should be read in conjunction with statements that are included herein and elsewhere, including the risk factors included in the Company’s annual and periodic reports filed with the SEC. The forward-looking statements are made only as of the date of this press release and, except as required by applicable law, the Company undertakes no obligation to revise or update any forward-looking statement, or to make any other forward-looking statements, whether as a result of new information, future events or otherwise.
Versamune® is a registered trademark and Infectimune™ is a trademark of PDS Biotechnology.
Non-dilutive sale of asset expected to materially enhance Energy Fuels’ balance sheet and help to fund the rapid advancement and expansion of near-term U.S. uranium and rare earth production
LAKEWOOD, Colo., Nov. 14, 2022 /CNW/ – Energy Fuels Inc. (NYSE American: UUUU) (TSX: EFR) (“Energy Fuels” or the “Company”), a leading U.S. producer of uranium and rare earth elements (“REE“), is pleased to announce that it has entered into a definitive agreement to sell three wholly-owned subsidiaries that together hold Energy Fuels’ Alta Mesa ISR Project (“Alta Mesa“) to enCore Energy (“enCore“) for total consideration of $120 million (the “Transaction“). The Transaction is expected to close by the end of 2022 or early 2023.
The Transaction is significant for the Company, as the cash received is expected to fully finance much of the Company’s uranium, REE, vanadium and medical isotope business plans for the next two to three years without diluting shareholders. These plans may include:
Ramping-up uranium production at one or more of the White Mesa Mill, the Nichols Ranch ISR Project, the Pinyon Plain mine, the La Sal Complex, and/or the Whirlwind mine which total up to two (2) million pounds of U3O8 per year of near-term, lower cost U.S. production capacity in order to fulfill commitments under existing and future long-term uranium supply agreements and as market conditions may warrant;
Accelerating the licensing and development of the Company’s larger-scale uranium mines, including the Sheep Mountain, Roca Honda, and/or Bullfrog projects, which together will add over five (5) million pounds of production capacity in the next several years;
Establishing an “ore purchasing” program to secure additional feed to the White Mesa Mill, from others in the region as uranium mining picks up in the region, thereby maximizing the facility’s existing eight (8) million pounds per year licensed uranium production capacity and having sole ownership of this production;
Financing the construction of “first to market” in the U.S. “Phase 1” REE separation infrastructure (up to 2,500 – 5,000 MT per year TREO capacity, including 500 – 1,000 MT per year of NdPr oxide or oxalate expected) at the White Mesa Mill;
Advancing the design, engineering and permitting of a planned, large “world significant” “Phase 2” crack-and-leach and “light” and “heavy” REE separation facility (up to 15,000 mT per year TREO capacity).
Developing the Company’s Bahia heavy mineral sand and REE project in Brazil upon successful acquisition of the project; and
Acquiring additional monazite supply to feed the Company’s rapidly growing REE business.
The $120 million of total consideration will be paid by enCore to Energy Fuels as follows:
$60 million cash at closing; and
$60 million in a secured convertible note (the “Note”), payable in two years from the closing, bearing annual interest of eight percent (8%). The Note will be convertible at Energy Fuels’ election into enCore shares at a 20% premium to the 10-day volume-weighted average price of enCore shares ending the day before the closing. enCore is currently traded on the TSXV and has applied for a listing on the NASDAQ. The Note will be guaranteed by enCore Energy Corp., will be fully secured by Alta Mesa, and enCore will not be permitted to further encumber Alta Mesa with any third-party indebtedness, royalty or stream while the Note is outstanding. Unless a block trade or similar distribution is executed by Energy Fuels to sell the enCore common shares underlying the Note, Energy Fuels will be limited to converting the Note into a maximum of $10 million principal amount of the Note per thirty (30) day period.
Furthermore, enCore will assume all reclamation liabilities associated with Alta Mesa (approximately $10.3 million) and pay Energy Fuels the cash collateral on the existing reclamation bonds (approximately $3.6 million). Once the reclamation liabilities are transferred to enCore, Energy Fuels will be nearly 60% collateralized on its remaining reclamation obligations. The Company also estimates that the sale of Alta Mesa will reduce Energy Fuels’ cash burn by approximately $2 million per year.
Energy Fuels acquired Alta Mesa in 2016 for approximately $13.6 million of shares, and currently carries this project on its balance sheet at $8.2 million. The Transaction represents an exceptional return on investment for Energy Fuels, and the value metrics of the Transaction compare favorably against precedent transactions within the uranium sector. Energy Fuels expects to replace the expected uranium production from Alta Mesa through permitting and production from its existing larger mining projects, ore purchases, toll milling arrangements, additional alternate feed and clean-up material, and potentially other transactions as market conditions may warrant.
Mark S. Chalmers, President and CEO of Energy Fuels stated: “This is a unique transaction for Energy Fuels. Not only does it allow us to monetize the Alta Mesa Project for $120 million, it allows our company to focus and accelerate our higher priority uranium and rare earth projects without dilution to our shareholders. This non-dilutive transaction will add cash to Energy Fuels’ significant working capital position, which was $122 million at September 30, 2022. Energy Fuels will also retain some exposure to short-term market upside and optionality at Alta Mesa and enCore through the convertible note.
“With recent uranium market strength and having secured new long-term uranium contracts with major U.S. nuclear utilities earlier this year, the Company is beginning to perform the work needed to recommence production at one or more of our projects, with production expected to start as soon as 2023. We have already hired about 20 people, and the cash we receive from the Alta Mesa transaction will help further fund this ramp-up. On top of this, the Company plans to establish an “ore purchasing” program from future uranium mining from others that maximizes the underutilized uranium production capacity of the White Mesa Mill with the uranium produced going 100% to our account in a way that others cannot. Energy Fuels absolutely intends to retain our position as the leading producer of uranium in the U.S. through our remaining outstanding portfolio of ISR and conventional uranium assets, and this transaction with enCore helps to both finance and focus our plans in this regard without dilution associated with equity financings.
“This cash also helps facilitate our plans to install rare earth separation infrastructure at our White Mesa Mill, including the expected capacity to produce approximately 500 – 1,000 tonnes per annum of separated ‘light’ rare earth oxides (or oxalates) by the end of 2023 or early 2024. We are also working on a number of fronts to secure additional monazite supply to feed our new rare earth infrastructure, and we expect this cash to significantly help finance purchases of monazite, fund our Bahia project in Brazil upon successful completion of that acquisition, and otherwise help in this regard. If we are successful with our rare earth initiatives, we have the potential to be the ‘first-to-market’ in the U.S. for the sale of commercial quantities of separated NdPr oxides (or oxalates), a raw material for rare earth permanent magnets used in electric vehicle drivetrains, wind energy systems, and defense applications. For reference, high-efficiency EVs each require about one to two kilograms of NdPr oxide. Therefore, in the next 12-18 months, if we are successful in constructing our Phase 1 rare earth separation capabilities, Energy Fuels could be domestically producing enough magnet material for 250,000 to 1 million EV drivetrains per year.
“I also believe this Transaction represents an important step forward for enCore Energy. Alta Mesa is a fully permitted and developed U.S. uranium project, and enCore’s President and CEO, Paul Goranson, knows it well, having constructed and operated it himself about ten years ago. To us, this appears to be a value creative transaction for both Energy Fuels and enCore.”
The closing of the Transaction is expected to occur by December 31, 2022. If the Transaction is not completed due to certain circumstances, enCore is required to pay to Energy Fuels a $6 million break fee.
Cantor Fitzgerald Canada Corporation is acting as Energy Fuels’ financial advisor and Dorsey & Whitney LLP and Dentons are acting as Energy Fuels’ legal advisors in connection with the Transaction.
About Energy Fuels: Energy Fuels is a leading U.S.-based uranium mining company, supplying U3O8 to major nuclear utilities. The Company also produces vanadium from certain of its projects, as market conditions warrant, and is ramping up to full commercial-scale production of RE Carbonate. Its corporate offices are in Lakewood, Colorado near Denver, and all its assets and employees are in the United States. Energy Fuels holds three of America’s key uranium production centers: the White Mesa Mill in Utah, the Nichols Ranch ISR Project in Wyoming, and the Alta Mesa ISR Project in Texas. The White Mesa Mill is the only conventional uranium mill operating in the U.S. today, has a licensed capacity of over 8 million pounds of U3O8 per year, and has the ability to produce vanadium when market conditions warrant, as well as RE Carbonate from various uranium-bearing ores. The Nichols Ranch ISR Project is currently on standby and has a licensed capacity of 2 million pounds of U3O8 per year. The Alta Mesa ISR Project is also currently on standby and has a licensed capacity of 1.5 million pounds of U3O8 per year. In addition to the above production facilities, Energy Fuels also has one of the largest S-K 1300 and NI 43-101 compliant uranium resource portfolios in the U.S. and several uranium and uranium/vanadium mining projects on standby and in various stages of permitting and development. The primary trading market for Energy Fuels’ common shares is the NYSE American under the trading symbol “UUUU,” and the Company’s common shares are also listed on the Toronto Stock Exchange under the trading symbol “EFR.” Energy Fuels’ website is www.energyfuels.com.
Cautionary Note Regarding Forward-Looking Statements: This news release contains certain “Forward Looking Information” and “Forward Looking Statements” within the meaning of applicable United States and Canadian securities legislation, which may include, but are not limited to, statements with respect to: production and sales forecasts; the ability of the Company to accelerate uranium and rare earth production; scalability, and the Company’s ability and readiness to re-start, expand or deploy any of its existing projects or capacity to respond to any improvements in uranium market conditions;; any expectation as to the timing of the closing of the Transaction or whether the closing will in fact occur; any expectation that the Transaction may fully finance much of the Company’s uranium, rare earth, vanadium, and medical isotope business plans for the next two to three years; any expectation that the Company may license and eventually produce uranium from its Sheep Mountain, Roca Honda and/or Bullfrog projects; any expectation as to recommencement of production at any of the Company’s uranium mines or the timing thereof; any expectation as to the ability of the Company to secure any new sources of ore or other processing opportunities at the Mill through an ore purchasing program; any expectation as to timelines for the permitting and development of projects; any expectation that the Company will maintain its position as a leading uranium company in the United States; any expectation with respect to timelines to production; any expectation that the Mill will be successful in producing RE Carbonate and/or separated REE oxides or oxalates on a full-scale commercial basis; any expectation that Energy Fuels will be successful in developing U.S. separation, or other value-added U.S. REE production capabilities at the Mill, or otherwise, including the timing of any such initiatives and the expected production capacity or capital and operating costs associated with any such production capabilities; any expectation with respect to the quantities of monazite sands to be acquired by Energy Fuels, the quantities of RE Carbonate to be produced by the Mill or the quantities of contained TREO in the Mill’s RE Carbonate; any expectation that the Company may sell its separated NdPr oxide (or oxalate) to major electric vehicle manufacturers in the U.S. and Europe; any expectation that the Bahia Project has the potential to feed the Mill with REE and uranium-bearing monazite sand for decades; any expectation as to the quantities to be delivered under existing uranium sales contracts, or that such contracts may help underpin the Company’s uranium business for many years to come; and any expectation that the Company will generate net income in future periods. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “plans,” “expects,” “does not expect,” “is expected,” “is likely,” “budgets,” “scheduled,” “estimates,” “forecasts,” “intends,” “anticipates,” “does not anticipate,” or “believes,” or variations of such words and phrases, or state that certain actions, events or results “may,” “could,” “would,” “might” or “will be taken,” “occur,” “be achieved” or “have the potential to.” All statements, other than statements of historical fact, herein are considered to be forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements express or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements include risks associated with: commodity prices and price fluctuations; processing and mining difficulties, upsets and delays; permitting and licensing requirements and delays; changes to regulatory requirements; legal challenges; the availability of sources of Alternate Feed Materials and other feed sources for the Mill; competition from other producers; public opinion; government and political actions; available supplies of monazite sands; the ability of the Mill to produce RE Carbonate to meet commercial specifications on a commercial scale at acceptable costs; the ability of Neo to separate the RE Carbonate produced by the Mill to meet commercial specifications on a commercial scale at acceptable costs; market factors, including future demand for REEs; the ability of the Mill to be able to separate radium or other radioisotopes at reasonable costs or at all; market prices and demand for medical isotopes; and the other factors described under the caption “Risk Factors” in the Company’s most recently filed Annual Report on Form 10-K, which is available for review on EDGAR at www.sec.gov/edgar.shtml, on SEDAR at www.sedar.com, and on the Company’s website at www.energyfuels.com. Forward-looking statements contained herein are made as of the date of this news release, and the Company disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management’s estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements. The Company assumes no obligation to update the information in this communication, except as otherwise required by law.
SOURCE Energy Fuels Inc.
For further information: Investor Inquiries: Energy Fuels Inc., Curtis Moore, VP – Marketing and Corporate Development, (303) 974-2140 or Toll free: (888) 864-2125, [email protected], www.energyfuels.com
TORONTO–(BUSINESS WIRE)– Sierra Metals Inc. (TSX: SMT) (BVL:SMT) (NYSE American: SMTS) (“Sierra Metals” or the “Company”) confirms that it has received further correspondence from Compania Minera Kolpa S.A. (“Kolpa”) and Arias Resource Capital Management LP (“ARC”) regarding their previously announced unsolicited, non-binding letter of intent.
The Company has been diligently and expeditiously pursuing both short-term financing opportunities and the strategic review process announced in Sierra’s press release dated October 18, 2022. As previously announced, CIBC Capital Markets has been engaged as financial advisor to review strategic options.
Kolpa, ARC and other parties that have already expressed interest, among others, will be invited to participate and submit proposals so that they can be considered in the context of the strategic review process that is reasonably and fairly structured to be in the best interests of Sierra and all of its stakeholders. The process will give proper consideration to all viable options, not only the proposed Kolpa transaction.
The Company has not refused to engage nor rejected any proposals and welcomes and encourages participation of all interested parties. The Company is working diligently and expeditiously with full recognition of the timing considerations applicable in the current situation.
About Sierra Metals
Sierra Metals is a diversified Canadian mining company with Green Metal exposure including copper production and base metal production with precious metals byproduct credits, focused on the production and development of its Yauricocha Mine in Peru, and Bolivar and Cusi Mines in Mexico. The Company is focused on increasing production volume and growing mineral resources. The Company also has large land packages at all three mines with several prospective regional targets providing longer-term exploration upside and mineral resource growth potential.
For further information regarding Sierra Metals, please visit www.sierrametals.com or contact:
This press release contains forward-looking information within the meaning of Canadian and United States securities legislation, including the course of action, if any, to be pursued in response to the Kolpa non-binding letter of intent. Forward-looking information relates to future events or the anticipated performance of Sierra Metals and reflect management’s expectations or beliefs regarding such future events and anticipated performance based on an assumed set of economic conditions and courses of action. In certain cases, statements that contain forward-looking information can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, “believes” or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might”, or “will be taken”, “occur” or “be achieved” or the negative of these words or comparable terminology. By its very nature forward-looking information involves known and unknown risks, uncertainness and other factors that may cause actual performance of Sierra Metals to be materially different from any anticipated performance expressed or implied by such forward-looking information. The Company has made certain assumptions regarding, among other things, the strategic alternatives that may be available to it. By its very nature forward-looking information involves known and unknown risks, uncertainties and other factors that may cause actual performance of Sierra Metals to be materially different from any anticipated performance expressed or implied by such forward-looking information.
Forward-looking information is subject to a variety of risks and uncertainties, which could cause actual events or results to differ from those reflected in the forward-looking information, including, without limitation, the risks described under the heading “Risk Factors” in the Company’s annual information form dated March 16, 2022 for its fiscal year ended December 31, 2021 and other risks identified in the Company’s filings with Canadian securities regulators and the United States Securities and Exchange Commission, which filings are available at www.sedar.com and www.sec.gov, respectively.
The risk factors referred to above are not an exhaustive list of the factors that may affect any of the Company’s forward-looking information. Forward-looking information includes statements about the future and is inherently uncertain, and the Company’s actual achievements or other future events or conditions may differ materially from those reflected in the forward-looking information due to a variety of risks, uncertainties and other factors. The Company’s statements containing forward-looking information are based on the beliefs, expectations, and opinions of management on the date the statements are made, and the Company does not assume any obligation to update such forward-looking information if circumstances or management’s beliefs, expectations or opinions should change, other than as required by applicable law. For the reasons set forth above, one should not place undue reliance on forward-looking information.
Rising Unemployment: Economists Sometimes Say it’s Good for the Economy, But Are They Right?
interest rates are up, which means that projections for growth are down. Put simply, the proverbial something is close to hitting the fan.
Business closures and job losses are likely to become another hurdle for the global economy – and that points to rising unemployment. Yet, while most people would think of rising unemployment as a bad thing, some economists don’t entirely agree.
Economists have long pointed to a counterintuitive positive relationship between unemployment and entrepreneurship, born of the fact that people who lose their job often start businesses. This is often referred to within economic literature as necessity-based or push-factor entrepreneurship.
This article was republished with permission from The Conversation, a news site dedicated to sharing ideas from academic experts. It represents the research-based findings and thoughts ofDaragh O’Leary, PhD Researcher in Economics, University College Cork
Where it Gets Tricky
There is certainly good evidence for the existence of this contradictory relationship. The graph below shows the rates of UK business creation in blue and unemployment in red. As you can see, unemployment started to increase during the global financial crisis of 2007-09 and business creation followed not long after.
UK new business creation and unemployment, 2006-2020
This relationship between business creation and unemployment has previously been used by some as a justification for cold social policies towards the unemployed on the rationale that “the market fixes itself” in the long run. They see business closures and job losses not as human miseries that require government help, but necessary evils that are needed to reallocate the money, people and other resources back into the economy in more efficient ways .
But my latest research has found that rising unemployment is not quite the silver bullet for reigniting the economic engine that it’s cracked up to be. I looked at 148 regions across Europe from 2008 to 2017. Although I did find evidence that unemployment can stimulate business creation over time, this only seems to happen in higher performing regions within higher performing economies such as the Netherlands, Finland and Austria.
In lower performing regions within lower performing economies such as Bulgaria, Romania and Hungary, the relationship between unemployment and business creation actually appears to be negative. In other words, rather than inducing business creation, unemployment simply seems to lead to more unemployment.
The reason why higher performing regions in wealthier areas have a positive relationship between job losses and business creation is that they enjoy what are known as “urbanisation economies”. These are positive benefits derived from the scale and density of economic activity occurring within that area, including wider arrays of services, greater pools of customers and greater numbers of transactions relative to other areas of the economy.
For example, a firm located in a capital city like London will benefit from more abundant access to consumers, suppliers and lenders as well as larger labour pools. The higher population density in these areas also makes it more likely that firms and workers will learn faster as they observe the activities of their many neighbours. In more peripheral areas with fewer of these characteristics, the opposite is true. This is why unemployment affects different places differently.
What it Means
One consequence is that economists need to stop explaining how economies perform differently based solely on national factors. And it’s not just unemployment where this becomes apparent. For example, Ireland’s longstanding low rate of corporation tax (12.5%) has been cited as a reason for its high foreign direct investment, which accounts for roughly 20% of private sector employment.
Yet while just over 43% of all Irish enterprises in 2020 were located in either Dublin or Cork, counties like Leitrim in the north accounted for fewer than 1% of enterprises. So while national measures can help induce entrepreneurship and increase the overall size of the pie, the pie is shared very unequally. Just as rising unemployment can benefit some areas while hindering others, the same is true of government interventions.
Rural areas like County Leitrim have benefited far less from Ireland’s low corporation tax than more urbanised regions further south. Julia Gavin/Alamy
We therefore need to stop viewing the free market and government intervention as either wrong or right. In some contexts one is going to be more helpful, while in other contexts it will be the opposite. Recognizing this reality would improve on much of the polarized debate in politics and economics, in which those on the right can come across as cold and ignorant, while those on the left can seem self-righteous and sanctimonious, viewing capitalism and markets as dirty words.
How does this apply to today’s gathering downturn? It would make sense for governments to prioritize supporting businesses in more peripheral regions, while leaving those in wealthier urban areas to fend for themselves.
The famous economist John Kenneth Galbraith gave what I believe to be one of the best pieces of commentary on this topic, saying:
Where the market works, I’m for that. Where government is necessary, I’m for that … I’m in favor of whatever works in the particular case.
If we are to survive this upcoming recession and get things going again, we are going to need to acknowledge that centralized “one-size-fits-all” policies won’t be useful everywhere. The solutions to economic recovery are in some cases government intervention and in others the free market, but not always one or the other.
The Old Congress May Rush to Push Through a Debt Ceiling Agreement
Will there be a government shutdown as Congress grapples with debt ceiling issues?
Only Congress can spend money, so it is the job of Congress to set the upper limit if the nation may decide to go into debt. It is tricky most years, as the process often threatens the government shutdown of non-essential workers. Emergency spending measures often are used before an agreement is passed, before doing any further damage. The most damaging would be to the global faith in the U.S. Government to make do on its debts. Most U.S. Treasury securities are refinanced by reissuing new debt issues. If new debt issues can not be increased to cover today’s higher interest rates, or other increased levels of budgeted spending, the nation faces severe economic trouble.
Treasury Secretary Janet Yellen warned this weekend that lawmakers’ failure to raise the statutory limit on U.S. debt posed a “huge threat” to America’s credit rating and the functioning of U.S. financial markets.
Yellen said that cooperation is still possible between the two major political parties on other financial priorities, but lifting the debt ceiling is a non-negotiable item on the list.
Both parties always jockey for position to get funding for their projects as the country and government workers reel from the negotiation process each year. Currently, U.S. public debt stands at $31.2 trillion. Without an increase, it’s expected that there will be a default crisis by the third quarter of 2023.
Republicans tend to pay more lip service to making spending cuts. In 2010, a Republican lead Congress tried to hold the line on raising the budget risking a possible default on U.S. Government backed securities. The uncertainty over whether the U.S. could fund maturing U.S. Treasuries prompted a first-ever ratings cut on Treasury debt by Standard and Poor’s.
Yellen was asked whether Democrats, who will be in a weakened state after the new Congressional leaders take office in January, should pass legislation in the post-election session, while they still hold a majority. “I think it’s irresponsible not to raise the debt ceiling. It’s always been raised,” Yellen said. “It would be a huge threat to the country not to do it, and completely irresponsible to threaten the credit rating of America and the functioning of the single most important financial market.”
One of the higher priorities that Republicans would want to chop from the budget is the $87 billion in new funds the President wants for the IRS.
Yellen reminded that some Republicans backed last year’s infrastructure act and this year’s investments in semiconductors and research, she suggested the administration would look for measures that could draw further bipartisan support.
Take Away
Each year the U.S. Congress grapples with spending and financing the spending. The financed part, involves Congress providing enough money for the budgeted items. As interest rates rise, they become one more expense to be budgeted for and generally financed.
Janet Yellen, speaking at a G20 meeting in Indonesia warned of the need to lift the debt ceiling, as not doing so would have devastating economic impacts.
Established New R&D Facility and Expanded Existing cGMP Manufacturing Facility
Received Notice of Allowance for Patent Applications Covering Directed Differentiation Methods for Retinal Pigmented Epithelium and Oligodendrocyte Progenitor Cells
Cash, Cash Equivalents, and Marketable Securities of $66.4 Million as of September 30, 2022 Expected to Provide Capital Into Q3 2024
CARLSBAD, Calif.–(BUSINESS WIRE)–Nov. 10, 2022– Lineage Cell Therapeutics, Inc. (NYSE American and TASE: LCTX), a clinical-stage biotechnology company developing allogeneic cell therapies for unmet medical needs, today reported financial and operating results for the third quarter of 2022. Lineage management will host a conference call and webcast today at 4:30 p.m. Eastern Time/1:30 p.m. Pacific Time to discuss its third quarter 2022 financial and operating results and to provide a business update.
“A single administration of RG6501 (OpRegen®), a proprietary retinal pigment epithelial cell transplant, across an area of atrophy in advanced AMD patients has shown the potential to slow, stop, or reverse the progression of GA in our phase 1/2a clinical trial. To our knowledge, this is the first intervention that has reported anatomical changes of this magnitude in the field of GA, so we are pleased with the continued progress on RG6501 and the efforts which have been made to initiate its next clinical trial,” stated Brian M. Culley, Lineage CEO. “Looking ahead, our focus turns increasingly to planned regulatory interactions for OPC1 and VAC2, from which we expect to inform and enable their next phases of clinical development in spinal cord injury and oncology, respectively. In parallel, we are advancing our newly launched cell transplant programs in photoreceptors for vision disorders and auditory neurons for hearing loss, with initial preclinical studies from our photoreceptor program currently ongoing and the start of preclinical testing of our auditory neuron program anticipated prior to year-end. We believe that completing these efforts while maintaining our commitment to disciplined spending will help Lineage create shareholder value in the coming year.”
Recent milestones and activities included:
– Announced appointment of Jill Howe as Chief Financial Officer effective November 14, 2022
Ms. Howe brings more than 20 years of significant strategic, financial, and operational experience to Lineage, with an emphasis on capital strategy, corporate finance, treasury management, global infrastructure, and operational excellence. Ms. Howe has successfully built biotechnology organizations and implemented operational infrastructures alongside the execution of over $1.66 billion of capital raising transactions and will bring extensive strategic experience to the role.
– Established new U.S. R&D facility and expanded current GMP manufacturing facility in Israel
New Carlsbad facility will allow us to broaden R&D capabilities in the U.S. and facilitate the advancement of current and future allogeneic cell transplant programs and partnerships; the expansion of the Israel-based facility is expected to increase infrastructure, including development and optimization of larger-scale clinical manufacturing processes, and continued execution under the ongoing collaboration with Roche and Genentech for RG6501 (OpRegen).
Company announced notice of allowance of two patents covering processes for manufacturing allogeneic oligodendrocyte progenitor and retinal pigmented epithelium cells.
– OPC1
Completed verification and validation and preclinical testing activities for the novel parenchymal spinal delivery (PSD) system to support an upcoming regulatory submission.
– VAC2
Pre-Investigational New Drug (IND) application briefing package submitted to the U.S. Food and Drug Administration (FDA) to support U.S. clinical development for immuno-oncology.
– ANP1 & PNC1
Continued process development and activities in support of ongoing and planned preclinical testing.
Some of the key upcoming milestones and activities anticipated by Lineage include:
– Planned Regenerative Medicine Advanced Therapy (RMAT) submission to FDA before year-end regarding an OPC1 IND amendment to enable clinical testing of a novel spinal cord delivery system.
– Response to a pre-IND regulatory submission which should provide clarity on a VAC2 CMC, nonclinical, and clinical information package to inform future U.S. clinical development, expected around year-end.
– Completion of an R&D manufacturing process sufficient to support initiation of preclinical testing and the initiation of such testing with ANP1 for the treatment of hearing loss, anticipated prior to year-end.
– An additional OPC1 manuscript from a Phase 1/2a clinical study in subacute cervical spinal cord injury.
– Submission of a grant application to California Institute for Regenerative Medicine (CIRM) for the continued support of the clinical development of OPC1.
– Clinical data update from the ongoing VAC2 Phase 1 non-small cell lung cancer (NSCLC) study, pending release from Cancer Research UK (CRUK).
– Evaluation of new partnership opportunities and/or expansion of existing collaborations.
– Continued participation in investor and partnering meetings and medical and industry conferences to broaden awareness of our mission, programs, and accomplishments.
Balance Sheet Highlights
Cash, cash equivalents, and marketable securities totaled $66.4 million as of September 30, 2022, which is expected to support planned operations into Q3 2024.
Third Quarter Operating Results
Revenues: Lineage’s revenue is generated primarily from licensing fees, royalties, collaboration revenues, and research grants. Total revenues for the three months ended September 30, 2022 were approximately $3.0 million, a net increase of $0.7 million as compared to $2.3 million for the same period in 2021. The increase was driven by collaboration and licensing revenue recognized from deferred revenues from the Roche Agreement, partially offset by less royalty revenues.
Operating Expenses: Operating expenses are comprised of research and development (“R&D”) expenses and general and administrative (“G&A”) expenses. Total operating expenses for the three months ended September 30, 2022 were $8.0 million, a decrease of $0.1 million as compared to $8.1 million for the same period in 2021.
R&D Expenses: R&D expenses for the three months ended September 30, 2022 were $3.6 million, a net increase of $0.8 million as compared to $2.8 million for the same period in 2021. The net increase was primarily driven by higher OpRegen related expenses to support the Roche collaboration.
G&A Expenses: G&A expenses for the three months ended September 30, 2022 were $4.4 million, a net decrease of approximately $0.9 million as compared to $5.3 million for the same period in 2021. The decrease was primarily driven by $1.1 million in lower litigation and legal expenses and $0.3 million in lower investor relations expense, partially offset by a $0.5 million increase in payroll and related benefits expense.
Loss from Operations: Loss from operations for the three months ended September 30, 2022 was $5.2 million, a decrease of $1.6 million as compared to $6.8 million for the same period in 2021.
Other Expenses, Net: Other expenses, net for the three months ended September 30, 2022 reflected other expense, net of $0.3 million, compared to other expense, net of $2.0 million for the same period in 2021. The net change was primarily driven by a decrease in the value of marketable equity securities and exchange rate fluctuations related to Lineage’s international subsidiaries.
Net Loss Attributable to Lineage: The net loss attributable to Lineage for the three months ended September 30, 2022 was $6.1 million, or $0.04 per share (basic and diluted), compared to a net loss attributable to Lineage of $7.8 million, or $0.05 per share (basic and diluted), for the same period in 2021.
Conference Call and Webcast
Interested parties may access today’s conference call by dialing (800) 715-9871 from the U.S. and Canada and should request the “Lineage Cell Therapeutics Call” or provide conference ID number 5262180. A live webcast of the conference call will be available online in the Investors section of Lineage’s website. A replay of the webcast will be available on Lineage’s website for 30 days and a telephone replay will be available through November 17, 2022, by dialing (800) 770-2030 from the U.S. and Canada and entering conference ID number 5262180.
About Lineage Cell Therapeutics, Inc.
Lineage Cell Therapeutics is a clinical-stage biotechnology company developing novel cell therapies for unmet medical needs. Lineage’s programs are based on its robust proprietary cell-based therapy platform and associated in-house development and manufacturing capabilities. With this platform Lineage develops and manufactures specialized, terminally differentiated human cells from its pluripotent and progenitor cell starting materials. These differentiated cells are developed to either replace or support cells that are dysfunctional or absent due to degenerative disease or traumatic injury or administered as a means of helping the body mount an effective immune response to cancer. Lineage’s clinical and preclinical programs are in markets with billion dollar opportunities and include five allogeneic (“off-the-shelf”) product candidates: (i) OpRegen, a retinal pigment epithelial cell therapy in development for the treatment of geographic atrophy secondary to age-related macular degeneration, is being developed under a worldwide collaboration with Roche and Genentech, a member of the Roche Group; (ii) OPC1, an oligodendrocyte progenitor cell therapy in Phase 1/2a development for the treatment of acute spinal cord injuries; (iii) VAC2, a dendritic cell therapy produced from Lineage’s VAC technology platform for immuno-oncology and infectious disease, currently in Phase 1 clinical development for the treatment of non-small cell lung cancer; (iv) ANP1, an auditory neuronal progenitor cell therapy for the potential treatment of auditory neuropathy; and (v) PNC1, a photoreceptor neural cell therapy for the potential treatment of vision loss due to photoreceptor dysfunction or damage. For more information, please visit www.lineagecell.com or follow the company on Twitter @LineageCell.
Forward-Looking Statements
Lineage cautions you that all statements, other than statements of historical facts, contained in this press release, are forward-looking statements. Forward-looking statements, in some cases, can be identified by terms such as “believe,” “aim,” “may,” “will,” “estimate,” “continue,” “anticipate,” “design,” “intend,” “expect,” “could,” “can,” “plan,” “potential,” “predict,” “seek,” “should,” “would,” “contemplate,” “project,” “target,” “tend to,” or the negative version of these words and similar expressions. Such statements include, but are not limited to, statements relating to: our ability to support our planned operations into the third quarter of 2024 with our existing cash, cash equivalents and marketable securities; Ms. Howe’s employment with Lineage and the anticipated or implied benefits thereof to Lineage and Lineage’s continued growth and ability to exhibit greater productivity in the future; plans and expectations regarding our products in development and our ability to advance our product candidates into their next phases of clinical or preclinical testing; our ability to create shareholder value in the future; the potential benefits to us and our operations of our new and expanded facilities, including the broadening of our R&D capabilities, advancing our programs and partnerships, and increasing our infrastructure; our ability to support multiple years of progress and achieve important milestones; our collaboration and license agreement with Roche and Genentech and the potential to receive milestone and other consideration thereunder; the potential benefits of treatment with OpRegen; the potential future achievements of our clinical and preclinical programs; the timing of anticipated FDA interactions, preclinical activities, clinical trials, and clinical data updates related to our programs, and the submission of a grant application to the CIRM; plans and expectations regarding publications relating to our programs; plans and expectations regarding potential new partnership opportunities and existing collaborations; and our ability to broaden awareness of our mission and accomplishments. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Lineage’s actual results, performance or achievements to be materially different from future results, performance or achievements expressed or implied by the forward-looking statements in this press release, including, but not limited to, the following risks: that we may need to allocate our cash to unexpected events and expenses causing us to use our cash more quickly than expected; that potential benefits of the new and expanded facilities to the Company and its operations may not be realized as quickly as expected or at all; that potential benefits of newly developed intellectual property to the Company may not be realized as quickly as expected or at all; that positive findings in early clinical and/or nonclinical studies of a product candidate may not be predictive of success in subsequent clinical and/or nonclinical studies of that candidate; that competing alternative therapies may adversely impact the commercial potential of OpRegen; that Roche and Genentech may not successfully advance OpRegen or be successful in completing further clinical trials for OpRegen and/or obtaining regulatory approval for OpRegen in any particular jurisdiction; that we may not establish new partnerships or expand existing collaborations; that we do not successfully broaden awareness of our mission or accomplishments; that we may not be able to manufacture sufficient clinical quantities of its product candidates in accordance with current good manufacturing practice; and those risks and uncertainties inherent in Lineage’s business and other risks discussed in Lineage’s filings with the Securities and Exchange Commission (SEC). Lineage’s forward-looking statements are based upon its current expectations and involve assumptions that may never materialize or may prove to be incorrect. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. Further information regarding these and other risks is included under the heading “Risk Factors” in Lineage’s periodic reports with the SEC, including Lineage’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed with the SEC and its other reports, which are available from the SEC’s website. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which they were made. Lineage undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as required by law.
