HXBM Helix Biomedix Inc (PK)

Helix BioMedix, Inc. (OTCQB: HXBM), a developer of bioactive peptides, today announced financial results for the third quarter ended September 30, 2012.

Third Quarter 2012 Highlights

• Revenue was $469,000 for the third quarter of 2012, compared to $395,000 for the third quarter of 2011.
• Net loss was $785,000 for the third quarter of 2012, compared to $606,000 for the same period in 2011. The increase in net loss reflects higher operating expenses and professional fees.
• Revenue for the first nine months of 2012 was $1,620,000 compared to $1,445,000 for the first nine months of 2011.
• Cash and cash equivalents were $217,000 at September 30, 2012, compared to $1,689,000 at December 31, 2011.

Third Quarter 2012 Results

Total revenue for the third quarter of 2012 was $469,000, compared to $395,000 for the third quarter of 2011. Revenue in the third quarter reflected an increase in peptide and consumer product sales and license fees, offset by a decrease in sales to NuGlow Cosmaceuticals, LLC (NuGlow), an affiliated company. For the first nine months of 2012, revenue was $1,620,000 compared to $1,445,000 for the same period in 2011.

Total operating expenses were $1,082,000 for the third quarter of 2012, compared to $858,000 in the prior year period. The increase in expenses was primarily attributable to higher spending in marketing activities, external trial studies, patent maintenance expenses, and professional fees related to the company’s proposed reverse stock split and “going private” transaction.

Net loss for the third quarter of 2012 was $785,000, or $(0.02) per share, compared to a net loss of $606,000, or $(0.01) per share, for the third quarter of 2011. For the nine months of 2012, net loss was $2,035,000, or ($0.04) per share, compared to a net loss of $1,940,000, or ($0.04) per share, for the first nine months of 2011.

As of September 30, 2012, cash and cash equivalents were $217,000, compared to $1,689,000 at December 31, 2011. The decrease in cash was due primarily to cash used in operations. On October 12, 2012, the company drew down $750,000 against its existing $2.0 million line of credit agreement to fund working capital needs.

Commenting on the results, R. Stephen Beatty, President and Chief Executive Officer of Helix BioMedix, stated, “License fees and peptide and consumer sales grew in the third quarter; however, our affiliated company’s sales dipped due to certain operational issues with its direct mail program, which it believes have since been resolved. We look forward to continued progress in 2012.”

About Helix BioMedix, Inc.

Helix BioMedix, Inc. is a biopharmaceutical company with an extensive library of structurally diverse bioactive peptides and patents covering hundreds of thousands of peptide sequences. Core competencies include peptide design, synthesis and characterization together with assay development, screening, tissue culture and microbiology, leveraged through relationships with contract research organizations and peptide manufacturers. The company takes product development programs from theoretical concept to a qualified skin care active ingredient fully validated as to efficacy and safety. Applications for Helix BioMedix peptides include anti-aging cosmeceutical skin care and acne treatment as well as other topical anti-infective pharmaceuticals and wound healing applications. Striking and SmartPeptides are registered trademarks and Cerakine, Apothederm and SmartPeptide are trademarks of Helix BioMedix, Inc. More information about the company and its proprietary peptides may be found on the company’s website at www.helixbiomedix.com.

Forward-Looking Statements

This press release contains forward-looking statements (statements which are not historical facts) within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements regarding activities, events or developments that the company expects, believes or anticipates may occur in the future, including statements related to its potential growth, product development and commercialization and revenue. A number of factors could cause actual results to differ from those indicated in the forward-looking statements, including the company's ability to consummate its proposed reverse stock split and “going private” transaction, raise additional capital, enter into revenue generating license agreements, continue its research and development efforts, including pre-clinical and clinical studies, and continue developing marketable peptide-based products, and general economic conditions. Additional assumptions, risks and uncertainties are described in detail in the company’s reports and other filings with the Securities and Exchange Commission. Such filings are available on the company’s website or at www.sec.gov. Readers are cautioned that such forward-looking statements are not guarantees of future performance and that actual results or developments may differ materially from those set forth in the forward-looking statements. The company undertakes no obligation to publicly update or revise forward-looking statements to reflect subsequent events or circumstances.

   

HELIX BIOMEDIX, INC.

CONDENSED BALANCE SHEETS

(Unaudited)

  September 30,2012 December 31,2011 ASSETS Current assets: Cash and cash equivalents $ 216,534 $ 1,688,945 Accounts receivable, net 284,809 239,773 Accounts receivable, affiliated company, net 112,691 200,935 Inventory 330,989 363,869 Deferred debt issuance costs, current 201,040 — Prepaid expenses and other assets   64,009     64,583     Total current assets 1,210,072 2,558,105 Property and equipment, net 19,602 26,098 Intangible assets, net 95,470 146,297 Deferred debt issuance costs, non-current 150,917 — Other long term assets 8,522 20,884 Investment in affiliated company   217,339     223,255     Total assets $ 1,701,922   $ 2,974,639     LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 321,565 $ 125,324 Accrued compensation and benefits 64,933 87,859 Accrued expenses 63,603 55,463 Deferred revenue 7,060 — Deferred gross profit, affiliated company 62,509 134,842 Deferred rent, current   —     7,155     Total current liabilities 519,670 410,643 Deferred rent, non-current   32,258     28,660     Total liabilities 551,928 439,303 Commitments and contingencies Stockholders’ equity: Preferred stock, $0.001 par value, 25,000,000 shares authorized; no shares issued or outstanding — — Common stock, $0.001 par value, 100,000,000 shares authorized; 49,720,255 shares outstanding at September 30, 2012 and December 31, 2011 49,721 49,721 Additional paid-in capital 49,192,432 48,542,453 Accumulated deficit   (48,092,159 )   (46,056,838 )   Total stockholders’ equity   1,149,994     2,535,336     Total liabilities and stockholders’ equity $ 1,701,922   $ 2,974,639            

HELIX BIOMEDIX, INC.

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

  Three Months Ended September 30, Nine Months Ended September 30, 2012 2011 2012

2011

Revenue: Licensing fees $ 240,550 $ 176,922 $ 729,095 $ 513,322 Peptide and consumer product sales 176,669 100,884 605,190 576,165 Consumer product sales to affiliated company   51,852     116,901     285,730     355,951     Total revenue   469,071     394,707     1,620,015     1,445,438     Cost of revenue: Cost of peptide and consumer product sales 113,407 70,834 380,543 409,829 Cost of consumer product sales to affiliated company   21,832     56,961     128,684     191,486     Total cost of revenue   135,239     127,795     509,227     601,315     Gross profit 333,832 266,912 1,110,788 844,123 Operating expenses: Research and development 133,009 109,221 308,036 425,131 Marketing and business development 302,040 225,732 874,791 674,187 General and administrative 418,868 327,162 1,132,679 1,043,843 Accounting, legal and professional fees 205,192 168,043 605,615 477,676 Depreciation and amortization   22,896     27,845     68,054     82,609     Total operating expenses   1,082,005     858,003     2,989,175     2,703,446     Loss from operations   (748,173 )   (591,091 )   (1,878,387 )   (1,859,323 )   Other income (expense): Interest income 133 704 1,257 2,836 Amortization of debt issuance costs (50,673 ) — (112,913 ) — Equity in income (loss) of affiliated company 14,674 (23,373 ) (32,916 ) (74,446 ) Change in fair value of option to purchase interest in affiliated company   (1,145 )   8,143     (12,362 )   (9,293 )   Total other income (expense), net   (37,011 )   (14,526 )   (156,934 )   (80,903 )   Net loss and comprehensive loss $ (785,184 ) $ (605,617 ) $ (2,035,321 ) $ (1,940,226 )   Basic and diluted net loss per share $ (0.02 ) $ (0.01 ) $ (0.04 ) $ (0.04 )   Weighted average shares outstanding   49,720,255     49,720,255     49,720,255     49,720,255