Hofseth Biocare ASA: SECOND QUARTER & H1 2022 FINANCIAL REPORT

Hofseth Biocare ASA

HBC had gross operating revenues of NOK 25.8m (31.0m) in the second quarter. For the first half of 2022 HBC had revenues of NOK 56.6m (47.9m). Cost of sales (CoGS) amounted to NOK 17.7m (21.6m) in the quarter. Operating profit (EBITDA) for the quarter was NOK -18.3m (-14.6m) and Operating loss (EBIT) amounted to NOK 26.8m (22.7m) in the second quarter and NOK 60.3m (51.5m) for the first half of 2022.

Cash flow from operations during the first quarter was NOK -8.8m, compared to NOK -17.9m in first quarter last year. Net cash flow from investment activities was NOK -4.6m in the first quarter, compared to NOK -11.5m in the corresponding quarter last year. Cash flow from financing activities amount­ed to NOK -5.9m in the first quarter, compared to NOK -4.9m in the first quarter in 2021.

Highlights in the second quarter

• The second quarter was impacted by the constrained supply of salmon-off cuts from the price spike in salmon which resulted in unusually low production volumes of raw material. However, a very strong demand and favourable market prices resulted in net sales of NOK 25m with a gross margin of 31 %, compared to 21 % same period last year.

• We successfully completed our second preclinical assay of the bioactive peptides in SPH in prostate cancer after publishing the results from our first preclinical assay in the journal Marine Drugs. We have demonstrated that the addition of the peptides to standard of care enhanced anti-tumor activity in drug-sensitive and drug-resistant cell lines.

• Manufacturing optimization of the lead eosinophilia modulating lipopeptide MA-022 has been successfully completed. Preclinical trial work with MA-022 as a drug lead in eosinophilic esophagitis is planned.

For further information, please contact:
Jon Olav Ødegård, CEO of Hofseth BioCare ASA
Phone: +47 93632966
E-mail: joo@hofsethbiocare.no

About Hofseth BioCare ASA:
HBC is a Norwegian consumer and pet health ingredient supplier and an incubator for new pharmaceutical drug leads. Research is ongoing to identify the individual elements within its ingredients that modulate inflammation and the immune response with pre-clinical studies ongoing in multiple clinics and university research labs. Lead clinical and pre-clinical candidates are focused on developing an oral treatment for inflammatory disease driven by eosinophils (a type of white blood cell). Clinical trial work with the oil is ongoing to ameliorate lung inflammation in eosinophilic asthma and COPD ("smokers lung") as well as in COVID.
Other leads are focused on the protection of the Gastro- Intestinal (GI) system against inflammation (including ulcerative colitis and the orphan condition necrotising enterocolitis) and using peptide fractions of salmon protein hydrolysate (SPH also known as 'ProGo') as a Medical Food to help treat age-related Sarcopenia, and as a treatment for Iron Deficiency Anemia. The company is founded on the core values of sustainability, optimal utilization of natural resources and full traceability. Through an innovative hydrolysis technology, HBC can preserve the quality of the lipids, proteins and calcium from fresh salmon off-cuts.
Hofseth BioCare's headquarters are in Ålesund, Norway with branches in Oslo, London, Zürich, Ningbo, New Jersey and Palo Alto.
This information is subject to the disclosure requirements pursuant to Section 5-12 of the Norwegian Securities Trading Act

Attachment

• HBC Q2 2022 Financial Report