Codexis Reports Financial Results for the Second Quarter of 2014

Codexis Reports Financial Results for the Second Quarter of 2014

Conference call today at 4:30 pm ET

REDWOOD CITY, Calif., Aug. 6, 2014 (GLOBE NEWSWIRE) -- Codexis, Inc.
(Nasdaq:CDXS), a leading developer of biocatalysts for the pharmaceutical and
fine chemical industries, today announced its financial results for the second
quarter ended June 30, 2014.

"I am pleased to announce that Codexis is now set to deliver a positive cash
flow result in 2014, well ahead of our previous expectations. After delivering
results in line with our expectations in the second quarter of 2014, and based
on our recently announced Technology Collaboration and Licensing Agreement
with GSK, we are revising all of our financial guidance metrics for fiscal
year 2014," said John Nicols, President and CEO of Codexis. "We look forward
to executing on the new agreement with GSK, continuing to deliver growth from
our biocatalyst opportunity pipeline, as well as working to bring in
additional CodeEvolver® protein engineering license deals with other
innovative blue chip customers in the future."

Second Quarter Financial Highlights:

Revenues for the quarter ended June 30, 2014 were $6.6 million, a 6% decrease
from $7.0 million of revenues recorded in the second quarter of 2013.
Biocatalyst product revenue in the second quarter of 2014 was $2.8 million, a
44% decrease from $4.9 million in the prior year quarter. The decrease was
primarily due to the expected loss of the company's biocatalyst and
intermediate sales to customers in the hepatitis C drug marketplace.
Biocatalyst product gross margins in the second quarter were 24%, a decrease
compared to 27% in the prior year quarter.

Biocatalysis research and development revenues in the second quarter of 2014
were $1.7 million, an increase of 6%, compared with $1.6 million for the
second quarter of 2013. Revenue from our arrangement with Exela Pharma
Sciences related to the anticoagulant drug argatroban was $2.1 million in the
second quarter of 2014, an increase of $1.7 million, or 410% over Exela
revenues in the second quarter of 2013.

Research and development expenses in the second quarter of 2014 were $7.7
million, a decrease of 10% from $8.6 million for the second quarter of 2013.
Research and development expenses for the second quarter of 2014 include
non-cash impairment charges of $2.5 million, which are primarily related to a
write down of equipment values associated with our CodeXol® detergent alcohol
program.Excluding these charges, research and development expenses decreased
$3.3 million or 38% in the second quarter of 2014 compared to the prior year
second quarter.The decrease was primarily due to headcount reductions and a
write down or disposal of excess equipment undertaken as part of the
company-wide restructurings implemented in late 2013. 

Selling, general and administrative expenses in the second quarter of 2014
were $5.6 million, a decrease of $1.5 million or 22% compared to $7.2 million
in the same period of 2013. The decrease was primarily due to reductions in
headcount and other discretionary expense reductions implemented as part of
those same company-wide restructurings begun in late 2013.

Net loss for the second quarter of 2014 was $8.5 million, or a loss of $0.22
per share, based on 38.0 million weighted average common shares outstanding in
the second quarter of 2014. This compares favorably to a net loss of $12.6
million, or a loss of $0.33 per share, during the second quarter of 2013.Net
loss on a year to date basis for the six months ended June 30, 2014 was $14.9
million, or $0.39 loss per share.This compares to a net loss of $22.2
million, or loss per share of $0.59 per share, for the six months ended June
30, 2013.

Cash, cash equivalents, and marketable securities at June 30, 2014 were $21.5
million.This compared to $25.9 million at December 31, 2013.

Technology Collaboration and License Agreement with GSK

On July 14, 2014, Codexis announced the signing of a platform technology
license agreement with GlaxoSmithKline (GSK).Under the terms of the
agreement,Codexisgranted GSK a license to useCodexis'proprietary
CodeEvolver® protein engineering platform technology in the field of human
healthcare. The license allows GSK to useCodexis'platform technology to
develop novel enzymes for use in the manufacture of GSK's pharmaceutical and
health care products. GSK may also use the licensed technology to develop new
therapeutic, diagnostic and prophylactic products in the human health
field.Upon completion of technology transfer, GSK will
haveCodexis'state-of-the-art CodeEvolver protein engineering platform
installed at itsUpper Merion, Pennsylvaniaresearch and development site.

Codexisis eligible to receive up to$25 millionover approximately the next
two years,$6 million of which was paid up front and an additional$19 million
subject to satisfactory completion of technology transfer milestones.Codexis
also has the potential to receive numerous additional milestone payments that
range from$5.75 million to $38.5 millionper project based on GSK's
successful application of the licensed technology. In addition,Codexiswill
be eligible to receive royalties based on net sales, if any, of a limited set
of products developed by GSK usingCodexis'CodeEvolver protein engineering
platform technology.

The agreement marks the first time thatCodexishas licensed its protein
engineering platform technology to any party in the healthcare field, and
reinforces both companies' belief that biocatalysts, engineered
byCodexis'CodeEvolver technology, may increasingly be deployed to reduce the
cost and increase the efficiency of pharmaceutical manufacturing. The use of
biocatalysts to manufacture pharmaceuticals has the potential to reduce the
number of manufacturing steps, reduce the use of hazardous chemicals and the
production of toxic waste, and reduce the energy intensity of the process.

Financial Outlook

Codexis' statements with regard to its financial outlook are based on current
expectations. The following statements are forward looking, and actual results
could differ materially depending on market conditions and the factors set
forth under "Forward-Looking Statements" below.

Codexis is revising its financial guidance for fiscal year 2014.Revenues for
2014 are now expected to total between $35 million and $38 million,
representing growth of 10% to 19% compared to the prior year.The company's
gross margin (defined as Total Revenue less Cost of Product Revenues) is now
expected to fall within the range of 70% to 75% as a percentage of total
revenues, a significant increase over the level of 54% gross margin delivered
in 2013.

Finally, the company now expects to achieve positive cash flow from operations
for fiscal year 2014.

Conference Call and Webcast

Codexis will hold a live conference call and audio webcast on Wednesday,
August 6, 2014, at 4:30 p.m. Eastern Time. The conference call dial-in numbers
are 866-515-2908 for domestic and 617-399-5122 for international. Please use
the pass code 51309147 and call approximately 10 minutes prior to start
time.A live webcast of the call will also be available from the Investors
section of www.codexis.com. A recording of the call will be available by
calling 888-286-8010 for domestic or 617-801-6888 for international, beginning
approximately two hours after the call, and will be available for up to seven
days. Please use the pass code 14129345 to access the replay. A webcast replay
will also be available from the Investors section of www.codexis.com
approximately two hours after the call, and will be available for up to 30
days.

About Codexis, Inc.

Codexis, Inc. develops engineered enzymes for pharmaceutical and fine chemical
production. Codexis' proven technologies enable scale-up and implementation of
biocatalytic solutions to meet customer needs for rapid, cost-effective and
green process development from research to manufacturing. For more
information, see www.codexis.com.

Forward-Looking Statements

This press release contains forward-looking statements relating to Codexis'
forecast for 2014 total revenue, gross margin and cash flow; Codexis' ability
to deliver growth from its biocatalyst opportunity pipeline; Codexis' ability
to bring in additional CodeEvolver protein engineering license deals in the
future; Codexis' expectation that it will receive up to $25 million over
approximately the next two years under the GSK agreement; the potential for
Codexis to receive project-based milestone payments from GSK that range from
$5.75 million to $38.5 million per project; the potential for Codexis to
receive royalties from GSK for net sales, if any, of a limited set of GSK
products developed using the CodeEvolver platform technology; the ability of
biocatalysts developed using the CodeEvolver technology to reduce the cost and
increase the efficiency of pharmaceutical manufacturing; the ability of
biocatalysts to reduce the number of manufacturing steps, reduce the use of
hazardous chemicals and the production of toxic waste, and reduce the energy
intensity of pharmaceutical manufacturing processes; and Codexis' ability to
transfer successfully the CodeEvolver platform technology to GSK. You should
not place undue reliance on these forward-looking statements because they
involve known and unknown risks, uncertainties and other factors that are, in
some cases, beyond Codexis' control and that could materially affect actual
results. Factors that could materially affect actual results include Codexis'
need for substantial additional capital in the future in order to expand its
business; Codexis' dependence on its collaborators; Codexis' dependence on a
limited number of products and customers in its pharmaceutical business;
potential adverse effects to Codexis' business if its customers'
pharmaceutical products are not received well in the markets; Codexis' ability
to develop and commercialize new products for the pharmaceutical markets; the
success of Codexis' cost saving measures; Codexis' ability to deploy its
technology platform in new market spaces; any impairments Codexis may be
required to record in the future with respect to its goodwill, intangible
assets or other long-lived assets; Codexis' pharmaceutical product gross
margins are variable and may decline from quarter to quarter; potential
adverse effects to Codexis' business if its customers' pharmaceutical products
are not received well in the markets; Codexis' ability to retain key
personnel; Codexis' reliance on customers to provide timely information in
order for Codexis to report accurately and timely its financial results;
Codexis' ability to compete may decline if it loses some of its intellectual
property rights; third party claims that Codexis infringes third party
intellectual property rights; and Codexis could face increased competition if
third parties misappropriate Codexis biocatalysts. Additional factors that
could materially affect actual results can be found in Codexis' Annual Report
on Form 10-K filed with the Securities and Exchange Commission on March 13,
2014, including under the caption "Risk Factors." Codexis expressly disclaims
any intent or obligation to update these forward-looking statements, except as
required by law.

Codexis, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In Thousands, Except Per Share Amounts)
                                                               
                               Three Months Ended     Six Months Ended
                               June 30,   June 30,    June 30,    June 30,
                               2014       2013        2014        2013
Revenues:                                                       
Product                         $2,776     $4,948      $5,761      $14,085
Collaborative research and      1,666      1,609       3,812       2,909
development
Product revenue share           2,128      417         4,071       1,461
                                                               
Total revenues                  6,570      6,974       13,644      18,455
                                                               
Costs and operating expenses:                                   
Cost of product revenues        2,123      3,631       4,647       9,296
Research and development        7,733      8,624       12,567      15,946
Selling, general and            5,625      7,169       11,737      15,293
administrative
                                                               
Total costs and operating       15,481     19,424      28,951      40,535
expenses
                                                               
Loss from operations            (8,911)    (12,450)    (15,307)    (22,080)
                                                               
Interest income                 3          16          12          43
Interest expense and other, net (8)        (183)       (126)       (268)
                                                               
Loss before income taxes        (8,916)    (12,617)    (15,421)    (22,305)
                                                               
Provision for (benefit from)    (437)      (12)        (567)       (77)
income taxes
                                                               
Net loss                        $(8,479) $ (12,605) $(14,854) $ (22,228)
                                                               
Net loss per share, basic and   $(0.22)  $(0.33)   $(0.39)   $(0.59)
diluted
                                                               
Weighted average common shares
used in computing net loss per  37,980     38,060      37,862      37,951
share, basic and diluted
                                                               
                                                               

Codexis, Inc.
Condensed Consolidated Balance Sheets
(unaudited)
(In Thousands)
                                                   
                                          June 30,  December 31,
                                          2014      2013
Assets                                              
Current assets:                                     
Cash and cash equivalents                  $20,090   $22,130
Marketable securities                      --        3,005
Accounts receivable, net                   2,944     5,413
Inventories                                1,963     1,487
Prepaid expenses and other current assets  1,618     1,567
Assets held for sale                       292       2,179
Total current assets                       26,907    35,781
                                                   
Restricted cash                            711       711
Non-current marketable securities          1,453     795
Property and equipment, net                4,853     8,446
Intangible assets, net                     7,873     9,560
Goodwill                                   3,241     3,241
Other non-current assets                   205       306
                                                   
Total assets                               $45,243   $58,840
                                                   
Liabilities and stockholders' equity                
Current liabilities:                                
Accounts payable                           $3,329    $3,961
Accrued compensation                       1,978     3,625
Other accrued liabilities                  2,833     1,612
Deferred revenues                          2,654     2,001
Total current liabilities                  10,794    11,199
                                                   
Deferred revenues, net of current portion  907       1,114
Other long-term liabilities                4,214     5,044
Totalliabilities                          15,915    17,357
                                                   
Stockholders' equity:                               
Common stock                               4         4
Additional paid-in capital                 300,663   298,370
Accumulated other comprehensive loss       374       (32)
Accumulated deficit                        (271,713) (256,859)
Totalstockholders' equity                 29,328    41,483
                                                   
Total liabilities and stockholders' equity $45,243   $58,840
                                                   

CONTACT: Investors
         Mike Rice, 646-597-6987
         mrice@lifesciadvisors.com
        
         Media
         Jemma Connor, +44 161 359 3255
         jemma.connor@notchcommunications.co.uk
 
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