Cereplast Reports 2013 First Quarter Financial Results

Cereplast Reports 2013 First Quarter Financial Results

2013 First Quarter Revenue Exceeds Revenue for All of 2012

SEYMOUR, Ind., May 20, 2013 (GLOBE NEWSWIRE) -- Cereplast, Inc. (OTCQB:CERP)
(the "Company"), a leading manufacturer of proprietary biobased, compostable
and sustainable bioplastics, today announced its financial results for the
quarter ending March 31, 2013. The Company generated $949,000 in net revenues
during the 2013 first quarter, exceeding revenue for all of 2012.

Mr. Frederic Scheer, Chairman and Chief Executive Officer of Cereplast,
stated, "The revenue generated during the first quarter of 2013, which
exceeded that for all of 2012, is a critical milestone for our company and a
testament to the validity of our technology and the opportunity we have in
front of us. Several growth drivers will allow this trend to continue
including the enforcement of legislation in Italy, along with similar
legislative movements that we expect from other European countries, and the
beginning of more aggressive steps from India's government. While we continue
to sell our grades and teach customers about our technology, we have made a
dedicated effort to manage costs and restructure our operations accordingly.
We therefore made a strategic decision to relocate our corporate offices,
which will yield a reduction in corporate expenses by approximately $600,000
to $800,000 per year. We are optimistic that the revenue growth we expect to
experience combined with the reduction in expenses will prove financially
beneficial to the future of the company and provide value to our
shareholders."

2013 Operational Highlights to Date:

  oNet revenue for the first quarter of 2013 totaled $949,000, exceeding
    total revenue for the entire 2012 fiscal year.
  oCereplast strategically restructured its global operations including
    relocating its corporate headquarters to Seymour, IN, the location of its
    manufacturing facility, and is moving its European headquarters to Milan,
    Italy. These restructurings are expected to reduce annual operating
    expenses by $600,000 to $800,000 per year and will take effect in May
    2013.
  oIn India, the Supreme Court has begun taking stronger legislative action
    to control the country's plastic pollution problem. As a result, Cereplast
    has begun receiving orders and payment for Compostable 3002 for the
    manufacture of single-use bags, and expects to receive more orders for
    this material in the near future.
  oCereplast recently announced a new bioplastic resin grade, Biopropylene®
    A150D, an injection molding grade manufactured with 51% post-industrial
    algae biomass. This is the first offering with 51% algae content and will
    be commercially available during the second quarter of 2013.
  oIn Italy, the demand for Cereplast Compostables® blown film resins
    continues as the implementation date for the sanctions is now days away.

2013 First Quarter Financial Results:

Net sales for the three months ended March 31, 2013 were approximately $0.9
million, compared to $0.1 million in the same period in 2012. Sales increased
from the prior year due to growing demand for bioplastics in European markets
primarily due to anticipated legislation in Italy, which banned the use of
traditional plastic bags in favor of bioplastic alternatives.

Cost of sales is comprised of variable costs associated with product revenues.
Cost of sales for the three months ended March 31, 2013 were approximately
$0.8 million, compared to $0.2 million for the same period in 2012. The
increase in cost of sales was due to an increase in sales.

Gross profit (loss) for the three months ended March 31, 2012 was
approximately $0.1 million, compared to ($0.1) million for the same period in
2012. The increase in gross profit was attributable to an increase in sales as
stated above.

Research and development expenses for the three months ended March 31, 2013
were $0.1 million, compared to approximately $0.1 million for the same period
in 2012. Research and development expenses have not increased as a percentage
of sales due to cost containment efforts to preserve working capital.

Selling, general and administrative expenses for the three months ended March
31, 2013 were $1.5 million, compared to $1.7 million for the same period in
2012. The decrease in sales, general and administrative expenses was primarily
due to reduced headcount and a reduction in fixed production overhead costs
classified as selling, general and administrative expense due to an extended
period of abnormally low production volume.

Other income and expense,net for the three months ended March 31, 2013 was a
net expense of $16.5 million, as compared to a net expense of $0.5 million in
the same period in 2012. The increase in expense was primarily non-cash items
from the change in derivative liabilities related to the Company's warrants,
short term convertible debt and preferred stock agreements. In addition, the
Company recorded non-cash debt extinguishment costs of $1.6 million related to
the repayment of term loan and convertible notes.

Net loss for the three months ended March 31, 2013 was $18.0 million, as
compared to $2.4 million in the same period in 2012. The increase in net loss
was primarily driven by an increase in other income and expense related to
financing transactions. As discussed above, other income and expense, net was
unfavorably impacted by debt extinguishment costs and a loss on derivative
liabilities totaling $14.9 million.

Conference Call       
Details:
Date:                 Monday, May 20^th
Time:                 4:30 p.m. Eastern
Participant Dial-In:  (480) 629-9712
Live Webcast:         http://www.cereplast.com/investors/events-presentations/

It is recommended that participants dial in approximately 10 minutes prior to
the start of the 4:30 p.m. Eastern call. There will also be a simultaneous
live webcast of the conference call which can be accessed through the
following audio feed link and archived recording of the conference call
available under the Investor Relations section of the company website at
http://www.cereplast.com/investors/events-presentations/.

About Cereplast, Inc.

Cereplast, Inc. (OTCQB:CERP) designs and manufactures proprietary biobased,
sustainable bioplastics which are used as substitutes for traditional plastics
in all major converting processes - such as injection molding, thermoforming,
blow molding and extrusions - at a pricing structure that is competitive with
traditional plastics. On the cutting-edge of biobased plastic material
development, Cereplast now offers resins to meet a variety of customer
demands. Cereplast Compostables® resins are ideally suited for single-use
applications where high biobased content and compostability are advantageous,
especially in the food service industry. Cereplast Sustainables® resins
combine high biobased content with the durability and endurance of traditional
plastic, making them ideal for applications in industries such as automotive,
consumer electronics and packaging. Learn more at www.cereplast.com. You may
also visit the Cereplast social networking pages at Facebook.com/Cereplast,
Twitter.com/Cereplast and Youtube.com/Cereplastinc.

Safe Harbor Statement

Matters discussed in this press release contain forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
When used in this press release, the words "anticipate," "believe,"
"estimate," "may," "intend," "expect" and similar expressions identify such
forward-looking statements. Actual results, performance or achievements could
differ materially from those contemplated, expressed or implied by the
forward-looking statements contained herein. These forward-looking statements
are based largely on the expectations of the Company and are subject to a
number of risks and uncertainties. These include, but are not limited to,
risks and uncertainties associated with: the impact of economic, competitive
and other factors affecting the Company and its operations, markets, product,
and distributor performance, the impact on the national and local economies
resulting from terrorist actions, and U.S. actions subsequently; and other
factors detailed in reports filed by the Company.

CEREPLAST, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except shares data)
                                                           
                                             March 31, 2013 December 31, 2012
                                                           
ASSETS                                                      
Current Assets                                              
Cash                                          $193         $183
Accounts Receivable, Net                     583           149
Inventory, Net                                6,086         6,941
Prepaid Expenses and Other Current Assets     176           227
Total Current Assets                          7,038         7,500
                                                           
Property and Equipment                                      
Property and Equipment                        11,480        11,601
Accumulated Depreciation and Amortization     (4,215)       (4,004)
Property and Equipment, Net                   7,265         7,597
                                                           
Other Assets                                                
Restricted Cash                               43            43
Deferred Loan Costs                           619           750
Intangible Assets, Net                        244           245
Deposits                                      47            47
Total Other Assets                            953           1,085
                                                           
Total Assets                                  $15,256      $16,182
                                                           
LIABILITIES AND SHAREHOLDERS' EQUITY                       
Current Liabilities                                         
Accounts Payable                              $820         $803
Accrued Expenses                              3,145         3,663
Capital Leases, Current Portion               85            85
Loan Payable, Current Portion                6,129         2,005
Convertible Subordinated Notes, Current       780           891
Portion
Derivative Liability                          8,589         3,189
Preferred Stock, $0.001 par value; 5,000,0000
shares authorized; 189 and 92 sharesissued   978           500
and outstanding at March 31, 2013
andDecember 31, 2012, respectively
Total Current Liabilities                     20,526        11,136
                                                           
Long-Term Liabilities                                       
Loan Payable                                  668           4,896
Convertible Subordinated Notes                9,338         10,000
Capital Leases, Long-Term                     158           173
Total Long-Term Liabilities                   10,164        15,069
Total Liabilities                             30,690        26,205
                                                           
Equity                                                     
Shareholders' Equity                                        
Common Stock, $0.001 par value;2,000,000,000
shares authorized; 332,701,675 and 63,463,659 333           63
shares issued and outstanding at March 31,
2013 and December 31, 2012, respectively
Common Stock Subscribed, not issued           5,626         --
Additional Paid in Capital                    83,597        76,919
Accumulated Deficit                           (105,146)     (87,097)
Accumulated Other Comprehensive Income        152           88
Total Shareholders' Equity                    (15,438)      57,952
Noncontrolling Interests                      4             4
Total Equity                                 (15,434)      57,956
                                                           
Total Liabilities and Shareholders' Equity   $15,256      $84,161


CEREPLAST, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in thousands, except per share data)
                                                              
                                                Three months ended
                                                March 31, 2013 March 31, 2012
                                                              
GROSS SALES                                      $950         $114
Sales Discounts, Returns and Allowances          (1)           (11)
NET SALES                                        949           103
                                                              
COST OF SALES                                    844           191
                                                              
GROSS PROFIT                                     105           (88)
                                                              
Research and Development                         106           129
Selling, General and Administrative              1,500         1,663
                                                              
LOSS FROM OPERATIONS BEFORE OTHER EXPENSES       (1,501)       (1,880)
                                                              
OTHER EXPENSES                                                 
Debt Extinguishment Costs                        (1,583)       --
Loss on Derivative Liability                     (13,316)      --
Interest and Other Income                        --            18
Interest Expense, Net                            (1,649)       (524)
                                                              
TOTAL OTHER EXPENSE, NET                         (16,548)      (506)
                                                              
NET LOSS BEFORE PROVISION FOR INCOME TAXES       (18,049)      (2,386)
                                                              
Provision for Income Taxes                       --            --
                                                              
NET LOSS                                         $(18,049)    $(2,386)
                                                              
                                                              
BASIC AND DILUTED LOSS PER SHARE                 $(0.08)      $(0.13)
                                                              
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING,      234,005,038   18,948,644
BASIC AND DILUTED


CEREPLAST, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands, except shares data)
                                                              
                                                Three months ended
                                                March 31, 2013 March 31, 2012
                                                              
CASH FLOWS FROM OPERATING ACTIVITIES:                          
Net Loss                                         $(18,049)    $(2,386)
Adjustment to Reconcile Net Loss to Net Cash                   
Used in Operating Activities
Depreciation and Amortization                    214           176
Common Stock Issued for Services, Salaries and   15            121
Wages
Amortization of Loan Discount                    1,475         19
Extinguishment of Convertible Debt               1,583         --
Loss on Derivative Liability                     13,316        --
Changes in Operating Assets and Liabilities                    
Accounts Receivable                              (434)         (43)
Deferred Loan Costs                              131           138
Inventory                                        854           121
Prepaid Expenses and Other Current Assets        50            147
Accounts Payable                                 21            (315)
Accrued Expenses                                 (22)          (289)
NET CASH USED IN OPERATING ACTIVITIES            (846)         (2,311)
                                                              
CASH FLOWS FROM INVESTING ACTIVITIES:                          
Purchase of Property and Equipment, and          (3)           (115)
Intangibles
Proceeds from Sale of Equipment                  --            15
NET CASH USED IN INVESTING ACTIVITIES            (3)           (100)
                                                              
CASH FLOWS FROM FINANCING ACTIVITIES:                          
Payments on Capital Leases                       (15)          (18)
Payments made on Notes Payable                   --            (454)
Proceeds from Convertible Subordinated Notes,    63            --
Net of Issuance Costs
Proceeds from Issuance of Common Stock and       (3)           --
Subscriptions, Net of Issuance Costs
Proceeds from Issuance of Preferred Stock, Net   750           --
of Issuance Costs
NET CASH PROVIDED BY FINANCING ACTIVITIES        795           (472)
                                                              
FOREIGN CURRENCY TRANSLATION                     64            2
                                                              
NET INCREASE IN CASH                             10            (2,881)
                                                              
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD   183           3,940
CASH AND CASH EQUIVALENTS, END OF PERIOD         $193         $1,059
                                                              
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION               
Cash Paid During the Year For:                                 
Interest                                         $12          $151
Income Taxes                                     $--         $--

CONTACT: Cereplast, Inc.
         Public Relations
         Nicole Robertson
         (310) 615-1900 x154
         nrobertson@cereplast.com
        
         Investor Relations:
         Alliance Advisors, LLC
         Alan Sheinwald
         914-669-0222
         asheinwald@allianceadvisors.net
        
         Valter Pinto
         914-669-0222 x201
         valter@allianceadvisors.net
         www.AllianceAdvisors.net

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