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Lattice Biologics Ltd. Reports First Quarter 2021 Highlights

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Lattice Biologics Ltd. (TSX-V: LBL) (OTCBB: LBLTF) ("Lattice Biologics" or the "Company") announces financial results for Q1 2021.

Highlights of Three Months Ended December 31, 2020

Sales and Product Offerings

  • Gross profit margin was 48.1% for the three months ended December 31, 2020, compared to 57.1% for the same period in the previous year.

  • For the three months ended December 31, 2020, sales decreased 32% compared to the same period in the previous year, while gross profit decreased 43% for the same periods.

  • Cash used in operations was $0.1 million for the three months ended December 31, 2020 compared to $0.1 million of cash provided by operations for the three months ended December 31, 2019.

Finance

  • Gross profit of $0.2 million on sales of $0.5 million for the three months ended December 31, 2020 compared to $0.4 million on sales of $0.7 million for the three months ended December 31, 2019.

  • Incurred a net loss of $0.3 million ($0.00 per share) for the three months ended December 31, 2020 compared to $0.1 million ($0.00 per share) for the three months ended December 31, 2019.

  • Total liabilities increased to $9.5 million from $9.4 million for December 31, 2020 and September 30, 2020, respectively. Current liabilities increased to $8.0 million from $7.8 million for December 31, 2020 and September 30, 2020, respectively.

Research and Development

  • Development of room temperature AmnioBoost and room temperature dermis for dental markets.

  • Development of allograft fiber plug for dental markets.

  • Developed proprietary liquid nitrogen shipping containers.

2021 Business Update:

"Business conditions have been exceptionally trying this year, and Lattice Biologics is no exception. The American Dental Association issued guidance in mid-March 2020 that all US dental procedures be considered non-essential. The announcement significantly impacted revenues in March 2020, and continues to affect supply chain issues. As we focus on new markets, we expect to re-position the company for profitable and continued growth," said Guy Cook, CEO of Lattice Biologics LTD.

With an enhanced product line intended for dental indications, we expect sales to continue to grow in the long term. Operationally, the company is much more efficient and has lowered its operating and overhead costs to effectively compete in the dental market space.

Lattice Biologics maintains its commitment to honoring the gift of donation by implementing a strong quality control environment for the recovery and processing of donors. The Company has significantly increased its processing efficiencies, and has substantial inventory reserves to meet customer demand.

As indicated below, the Company continues efforts to diversify the sales mix across the new higher margin product lines added in prior years.

Year End Financial Results (all figures denoted in USD):

The following table sets out selected unaudited financial information, prepared in accordance with IFRS. The information contained herein is drawn from interim financial statements of the Company for each of the following quarterly periods ending:

Dec-31

Sep-30

Jun-30

Mar-31

Dec-31

Sep-30

Jun-30

Mar-31

2020

2020

2020

2020

2019

2019

2019

2019

Revenue

$

474,573

$

795,779

$

504,217

$

464,450

$

699,898

$

522,263

$

447,973

$

751,084

Cost of sales

246,085

583,509

357,593

202,634

300,011

640,749

287,484

172,788

Gross profit

228,488

212,270

146,624

261,816

399,887

(118,486

)

160,489

578,296

Operating costs (i)

323,520

232,949

336,838

274,539

291,843

398,711

331,795

344,397

EBITDA (ii)

(52,839

)

96,030

(175,476

)

2,015

122,468

(502,485

)

(156,771

)

246,648

Net income (loss)

(269,132

)

(239,285

)

(319,739

)

(853,717

)

(69,893

)

(667,941

)

(291,203

)

61,975

Basic and diluted loss per share

(0.00

)

(0.00

)

(0.00

)

(0.01

)

(0.00

)

(0.00

)

(0.00

)

(0.01

)

Gross margin percent

48.1

%

26.7

%

29.1

%

56.4

%

57.1

%

-22.7

%

35.8

%

77.0

%

(i)

Operating costs are defined as all general and administrative costs, professional fees, rent, salaries and benefits, sales and marketing, and utilities expenses.

(ii)

EBITDA is defined as gross profit less operating costs (as defined above).

Dec-31

Sep-30

Jun-30

Mar-31

Dec-31

Sep-30

Jun-30

Mar-31

2020

2020

2020

2020

2019

2019

2019

2019

ADM dermis

$

-

0

%

$

-

0

%

$

-

0

%

$

-

0

%

$

-

0

%

$

-

0

%

$

-

0

%

$

-

0

%

DBM putty

-

0

%

-

0

%

-

0

%

-

0

%

-

0

%

-

0

%

-

0

%

-

0

%

Bone scaffold

474,573

100

%

795,779

100

%

504,217

100

%

464,450

100

%

699,898

100

%

508,458

97

%

432,400

97

%

725,435

97

%

Other

-

0

%

-

0

%

-

0

%

-

0

%

-

0

%

13,805

3

%

15,573

3

%

25,649

3

%

Total revenue

$

474,573

100

%

$

795,779

100

%

$

504,217

100

%

$

464,450

100

%

$

699,898

100

%

$

522,263

100

%

$

447,973

100

%

$

751,084

100

%

About Lattice Biologics Ltd.:

Lattice Biologics is traded on the TSX-V under the symbol: LBL.

Lattice Biologics develops and manufactures biologic products to domestic and international markets. The Company’s products are used in a variety of surgical applications.

Lattice Biologics maintains its headquarters, laboratory and manufacturing facilities in Belgrade, Montana. The facility includes ISO Class 1000 and ISO Class 100 clean rooms, and specialized equipment capable of crafting traditional allografts and precision specialty allografts for various clinical applications. The Lattice Biologics team includes highly trained tissue bank specialists, surgical technicians, certified sterile processing and distribution technicians, and CNC operators who maintain the highest standards of aseptic technique throughout each step of the manufacturing process. From donor acceptance to the final packaging and distribution of finished allografts, Lattice is committed to maintaining the highest standards of allograft quality, innovation, and customer satisfaction.

Lattice Biologics maintains all necessary licensures to process and sell its tissue engineered products within the U.S. and internationally.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Statement on Forward-Looking Information:

Certain information contained in this news release constitutes "forward-looking statements" within the meaning of the ‘safe harbour’ provisions of Canadian securities laws. All statements herein, other than statements of historical fact, are to be considered forward looking. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "planned", "potential", "future", "expected", "could", "possible", "goal", "intends", "will" or similar expressions. Forward-looking statements in this news release include, without limitation: information pertaining to the Company’s strategy, plans, or future financial performance, such as statements with respect to the Transaction, and other statements that express management’s expectations or estimates of future performance. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Lattice to be materially different from those expressed or implied by such forward-looking statements.

Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by management as of the date such statements are made, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The factors and assumptions that could prove to be incorrect, include, but are not limited to: that market prices will be consistent with expectations, the continued availability of capital and financing, and that general economic, market and business conditions will be consistent with expectations. The forward-looking statements are not guarantees of future performance. We disclaim any obligation to update or revise any forward-looking statements, except as required by law. Readers are cautioned not to put undue reliance on these forward-looking statements.

United States Advisory: The securities referred to herein have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered, sold, or resold in the United States or to, or for the account of or benefit of, a U.S. Person (as such term is defined in Regulation S under the U.S. Securities Act) unless an exemption from the registration requirements of the U.S. Securities Act is available. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in the state in the United States in which such offer, solicitation or sale would be unlawful.

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View source version on businesswire.com: https://www.businesswire.com/news/home/20210301006051/en/

Contacts

Media Contact:
Guy Cook, CEO
Lattice Biologics Ltd.
(TSX-V: LBL) (OTCBB: LBLTF)
512 E. Madison Ave. Suite#A1
Belgrade, MT 59714
480-563-0800 Office
News@LatticeBiologics.com
www.LatticeBiologics.com