Watch Live

Tweet TWEET

Solazyme Reports Fourth Quarter and Full Year 2013 Results

  Solazyme Reports Fourth Quarter and Full Year 2013 Results

                  Commercial Production Underway at Clinton

                         Moema Facility Commissioning

Business Wire

SOUTH SAN FRANCISCO, Calif. -- February 26, 2014

Solazyme, Inc. (NASDAQ:SZYM), a Renewable™ oil and bioproducts company,
announced today results for the fourth quarter and full year ended December
31, 2013.

“2013 was a year of great progress for Solazyme as we readied our first major
capacity projects, signed new commercial supply agreements, added important
joint development partners, and further expanded our portfolio of Tailored™
oils,” said Jonathan Wolfson, CEO of Solazyme. “In the first half of 2014, we
are focused on successfully executing Solazyme’s entry into broad commercial
operations. We have begun shipping multiple products from the Clinton/Galva,
Iowa facilities and are deep into commissioning in Brazil as we complete the
first-of-its-kind 100,000MT Solazyme Bunge Renewable Oils (SB Oils) facility
at Moema. In these early days we are focused on generating consistent and
reliable production for our partners, ahead of accelerating our production
ramp later this year.”

Financial Results

Total revenue for the fourth quarter ended December 31, 2013 was $11.3 million
compared with $8.4 million in the fourth quarter of 2012. Fourth quarter GAAP
net loss was $33.3 million, which compares with net loss of $24.6 million in
the prior year period. On a non-GAAP basis, the net loss was $27.4 million for
the fourth quarter of 2013, compared with net loss of $21.5 million in the
prior year quarter. A reconciliation of GAAP to non-GAAP results is included
below.

Total revenue for the year ended December 31, 2013 was $39.8 million compared
with $44.1 million in the prior year. Full year revenue, excluding government
funded program revenue, was $39.5 million compared with $29.7 million in the
prior year. Full year 2013 GAAP net loss was $116.4 million, compared with
$83.1 million in the prior year. On a non-GAAP basis, the net loss was $88.6
million for 2013, compared with $70.0 million in 2012.

“Solazyme’s 2013 results included 21% growth in our most commercially mature
business, as our Algenist^® skin care line expanded its product offerings and
geographic footprint. We also delivered on all of our joint development
milestones for our partners,” said Tyler Painter, CFO of Solazyme. “We
anticipate continued growth in these revenue streams in 2014 and look forward
to growing product revenues from commercial supply of our products later this
year as we ramp commercial production. In the meantime, Solazyme remains in a
healthy financial position as we complete our first plants and prepare to
broadly scale operations.”

2013 Highlights

  *Laid Foundation for Commercial Manufacturing in 2014: In 2013,  Solazyme
    completed construction of the 20,000 MT Archer-Daniels-Midland Company
    facility in Clinton, Iowa and the downstream companion facility operated
    by American Natural Products in Galva, Iowa and neared completion of the
    100,000 MT SB Oils facility in Brazil, setting the stage for the
    commercial operations that commenced at the Clinton/Galva facilities in
    early 2014, as well as the commissioning that is currently underway at the
    SB Oils facility in Brazil.
  *Production of Food Ingredients: Rapidly mobilized in the second half of
    2013 to successfully manufacture both Whole Algal Flour ingredients at the
    Peoria facility.
  *Research Partnerships Continue to Flourish: In 2013,  Solazyme announced a
    partnership with Mitsui & Co. Ltd. to develop a new suite of Tailored™
    oils and is ahead of schedule with both of the first two oils under this
    agreement. Solazyme also signed a joint development agreement with
    AkzoNobel and extended its key JDA agreements with Bunge Limited and
    Unilever.
  *Commercial Supply Agreements Signed: Solazyme announced a 10,000 MT supply
    agreement with its long-term partner Unilever in the third quarter of 2013
    and signed agreements with other customers, including fabric lubricant
    leader Goulston Technologies Inc. and metalworking lubricant distributor
    Koda Distribution Group, positioning its Tailored™ oils across multiple
    markets.
  *Development of New Tailored™ Oils: Solazyme continued to expand its
    technology platform through the development of multiple high value oils
    including its myristic, oleic, erucic, capric and caprylic Tailored oils.
  *Solid Algenist^® Sales Growth: Solazyme continued to grow its Algenist
    skincare brand, which now boasts 21 SKUs and was recently launched in
    China. Algenist revenues totaled $19.9 million in 2013, a 21% increase
    versus 2012. The Algenist brand also won the 2014 Marie Claire Prix
    d’Excellence de la Beauté in France. Algenist was unanimously selected by
    the judging panel.

Conference Call

Solazyme will hold a conference call for investors on February 26 at 1:30 p.m.
PT (4:30 p.m. ET). Investors may access the call by dialing 973-409-9250. A
live webcast of the call will be available from the Investor Relations section
of www.solazyme.com. A recording of the call will also be available by calling
404-537-3406; access code 71686679 beginning approximately two hours after the
call, and will be available for one week. A webcast replay from today’s call
will also be available from the Investor Relations section of www.solazyme.com
approximately two hours after the call and will be available for up to thirty
days.

About Solazyme, Inc.

Solazyme, Inc. (SZYM) is a Renewable™ oil and bioproducts company that
transforms a range of low-cost plant-based sugars into high-value oils.
Headquartered in South San Francisco, Solazyme’s Renewable™ products can
replace or enhance oils derived from the world’s three existing sources –
petroleum, plants and animal fats. Initially, Solazyme is focused on
commercializing its products into three target markets: (1) fuels and
chemicals, (2) nutrition and (3) skin and personal care.

Solazyme^®, Algenist^®, Tailored™, Renewable™ and the Solazyme logo are
trademarks of Solazyme, Inc.

Non-GAAP Financial Measures

This press release includes the following financial measure defined as a
“non-GAAP financial measure” by the Securities and Exchange Commission:
non-GAAP net loss. This measure may be different from non-GAAP financial
measures used by other companies. The presentation of this financial
information, which is not prepared under any comprehensive set of accounting
rules or principles, is not intended to be considered in isolation or as a
substitute for the financial information prepared and presented in accordance
with generally accepted accounting principles. For a reconciliation of this
non-GAAP financial measure to the nearest comparable GAAP measure, see
“Reconciliation of GAAP to Non-GAAP Net-Loss Per Share” included in the tables
to this press release.

This non-GAAP measure is provided to enhance investors’ overall understanding
of Solazyme’s current financial performance and Solazyme’s prospects for the
future. Specifically, Solazyme believes the non-GAAP measure provides useful
information to both management and investors by excluding certain expenses
that may not be indicative of its core operating results and business outlook.

For its internal budgeting process, Solazyme’s management uses financial
measures that do not include stock-based compensation expense or special
expenses such as non-cash gains or losses due to warrant revaluations. In
addition to the corresponding GAAP measures, Solazyme’s management also uses
the foregoing non-GAAP measure in reviewing the financial results of Solazyme.
Solazyme excludes stock-based compensation expenses and special non-cash
charges from its non-GAAP measures primarily because they are non-cash
expenses that management does not believe are reflective of ongoing operating
results.

Forward Looking Statements

This press release contains certain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995 about
Solazyme, including statements that involve risks and uncertainties
concerning: its commercialization and production plans and commercialization
timetable for its products; the growth of product and research and development
revenues; selling prices for products; the ramping up of facilities; the
timetable for bringing facilities online; meeting commercialization and
technology targets; and Solazyme’s ability to maintain its relationships with
its partners. When used in this press release, the words “will”, “expects”,
“intends” and other similar expressions and any other statements that are not
historical facts are intended to identify those assertions as forward-looking
statements within the meaning of the Private Securities Litigation Reform Act
of 1995. Any such statement may be influenced by a variety of factors, many of
which are beyond the control of Solazyme, that could cause actual outcomes and
results to be materially different from those projected, described, expressed
or implied in this press release due to a number of risks and uncertainties.
Potential risks and uncertainties include, among others: Solazyme’s limited
operating history; its limited history in commercializing products;
implementation risk in deploying new technologies; its limited experience in
constructing, ramping up and operating commercial manufacturing facilities;
its ability to sell its products at a profit; delays related to construction,
start-up and ramp-up of production facilities; its ability to manage
operational costs at production facilities; its ability to enter into and
maintain strategic collaborations; its ability to obtain requisite regulatory
approvals; and its access, on favorable terms, to any required financing.
Accordingly, no assurances can be given that any of the events anticipated by
the forward-looking statements will transpire or occur, or if any of them do
so, what impact they will have on the results of operations or financial
condition of Solazyme.

In addition, please refer to the documents that Solazyme, Inc. files with the
Securities and Exchange Commission, including its Quarterly Reports on Form
10-Q, as updated from time to time, for a discussion of these and other risks.
You are cautioned not to place undue reliance on forward-looking statements,
which speak only as of the date of this press release. Solazyme is not under
any duty to update any of the information in this press release.

                                                                             
SOLAZYME, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
In thousands, except per share amounts
(UNAUDITED)
                                                                             
                  Three Months Ended           Twelve Months Ended      
                    December 31,                    December 31,
                    2013        2012               2013         2012
Revenues                                                       
Research and
development         $ 5,024      $ 3,811            $ 19,788      $ 27,649
programs
Product              6,250       4,613            19,962       16,459   
revenues
Total revenues        11,274       8,424              39,750        44,108
                                                                             
Costs and
operating
expenses (1)
Cost of product       1,985        1,404              6,385         5,311
revenue
Research and          20,381       16,108             66,572        66,384
development
Sales, general
and                  16,923      15,888           62,933       57,516   
administrative
Total costs and
operating             39,289       33,400             135,890       129,211
expenses
                                                                        
Loss from             (28,015)     (24,976)           (96,140)      (85,103)
operations
                                                                             
Other income
(expense) (2)
Interest and
other income          (1,191)      249                (5,767)       1,511
(expense), net
Loss from
equity method         (2,696)      (631)              (8,237)       (1,824)
investment
Gain from
change in fair
value of              572          748                147           2,284
warrant
liability
Loss from
change in fair
value of             (2,006)     -                (6,392)      -        
derivative
liability
Total other
income                (5,321)      366                (20,249)      1,971
(expense)
                                                                        
Net loss            $ (33,336)   $ (24,610)        $ (116,389)   $ (83,132) 
Net loss per
share, basic        $ (0.49)     $ (0.40)          $ (1.81)      $ (1.37)   
and diluted
                                                                             
Weighted
average number
of common
shares used in
loss per              68,453       60,873             64,212        60,509
share
computation,
basic and
diluted
                                                                             


SOLAZYME, INC.
RECONCILIATION OF GAAP TO NON-GAAP BASIC NET LOSS PER SHARE
In thousands, except per share amounts
(UNAUDITED)

                       Three Months Ended             Twelve Months Ended
                                                
                       December 31,                   December 31,
                        2013       2012             2013        2012
Net loss               $ (33,336)   $ (24,610)        $ (116,389)   $ (83,132)
Gain from change
in fair value of         (572)        (748)             (147)         (2,284)
warrant liability
Loss from change
in fair value of         2,006        -                 6,392         -
derivative
liability
(1) Operating
expenses include
stock-based
compensation
expense as
follows:
Research and             1,806        985               5,917         3,924
development
Sales, general and      2,395       2,859            12,736       11,478
administrative
Total stock-based
compensation             4,201        3,844             18,653        15,402
expense
(2) Other income
(expense) includes
costs as follows:
Amortization of
debt discount and        281          -                 1,529         -
issuance costs
Dissolution of the
Solazyme Roquette       -           -                1,406        -
JV
Net loss               $ (27,420)   $ (21,514)        $ (88,556)    $ (70,014)
(non-GAAP)
                                                                    
Basic and diluted
loss per share         $ (0.49)     $ (0.40)          $ (1.81)      $ (1.37)
(GAAP)
                                                                    
Gain from change
in fair value of         (0.01)       (0.01)            -             (0.04)
warrant liability
Loss from change
in fair value of         0.03         -                 0.10          -
derivative
liability
Stock-based
compensation             0.07         0.06              0.29          0.25
expense
Amortization of
debt discount and        -            -                 0.02          -
issuance costs
Dissolution of the
Solazyme Roquette       -           -                0.02         -
JV
Net loss per share     $ (0.40)     $ (0.35)          $ (1.38)      $ (1.16)
(non-GAAP)



SOLAZYME, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
In thousands
(UNAUDITED)
                                                           
                                             December 31,         December 31,
                                             2013                 2012
Assets
                                                                  
Current assets
Cash, cash equivalents and marketable        $   167,521          $   149,005
securities
Other current assets                            24,296              16,274
Total current assets                             191,817              165,279
Property, plant and equipment - net              40,089               32,225
Other assets                                    26,799              19,520
Total assets                                 $   258,705          $   217,024
                                                                  
Liabilities and stockholders' equity
                                                                  
Current liabilities
Current portion of long-term debt            $   65               $   7,331
Other current liabilities                       25,229              17,607
Total current liabilities                        25,294               24,938
Other liabilities                                1,006                1,138
Long-term debt                                  93,457              7,637
Total liabilities                               119,757             33,713
Total stockholders' equity                      138,948             183,311
Total liabilities and stockholders'          $   258,705          $   217,024
equity


Contact:

Solazyme, Inc.
Corporate Communications:
Genet Garamendi
press@solazyme.com
or
Brainerd Communicators, Inc.
Jeff Majtyka,212-986-6667
majtyka@braincomm.com
or
Brad Edwards,212-986-6667
edwards@braincomm.com
 
Press spacebar to pause and continue. Press esc to stop.