Protein Polymer Technologies Reports Second Quarter Financial Results
SAN DIEGO, Aug. 4, 1998 -- Protein Polymer Technologies,
Inc. (Nasdaq: PPTI), reports today its financial results for the second
quarter ended June 30, 1998.
As recently required by the Securities and Exchange Commission,
the Company is obligated to include one-time, non-cash "imputed dividends"
of $3,266,000 from the sale and issuance of the Company's Series E Preferred
stock in April and May, which raised approximately $5.4 million. Including
this extraordinary expense, the Company had a net quarterly loss applicable
to common shareholders of $4,786,000 ($.46 a share), versus a net loss of
$1,303,000 ($.14 a share) for the comparable period in 1997. For the
six months ended June 30, 1998, the Company had a net loss applicable to
common shareholders of $6,133,000 ($.59 a share), versus a net loss of $2,302,000
($.25 a share) for the same period in 1997. Excluding the effect of
the imputed dividends, the net loss applicable to common shareholders would
have been $1,520,000 ($.15 per share) for the quarter ended June 30, 1998,
and $2,867,000 ($.27 per share) for the six months ended June 30, 1998.
Operating expenses for the quarter were $1,496,000, as
compared to $1,351,000 for the same period in 1997. For the six months
ended June 30, 1998, operating expenses totaled $2,860,000, compared to
$2,447,000 for the same period in 1997. The increased expenditures were
due to increased regulatory activity and preclinical testing in preparation
for clinical testing of the Company's soft tissue augmentation products.
Contract revenues, interest and product income totaled $45,000 for the quarter,
compared to $170,000 for the same period in 1997. For the six months
ended June 30, 1998, these revenues totaled $133,000, compared to $389,000
for the same period in 1997. The decreases were due to reduced contract
revenues and interest income. As a result of the sale of preferred
stock during April and May, the cash balance was $3,992,000 as of June 30,
1998, compared to $1,300,000 as of December 31, 1997.
"Our financial results for the quarter reflect our expanding
commitment to the development and registration of our stress urinary incontinence
(SUI) program," said J. Thomas Parmeter, PPTI's President and Chief Executive
Officer. "We expect to continue to spend at this level or higher,
to the extent capital is available, as we prepare to file an Investigational
Device Exemptions (IDE) with the U.S. Food and Drug Administration (FDA)
and begin human clinical studies for both the female stress urinary incontinence
indication and for cosmetic applications. Both of the IDE filings
are anticipated to occur within the next six months."
"Our strategy is to develop our potential products in-house
until sufficient shareholder value can be obtained from a strategic partnering
relationship. We are currently in discussions with a number of potential
partners regarding our product opportunities."
Protein Polymer Technologies, Inc., a San Diego-based
company, develops high performance biomaterials designed to improve medical
and surgical outcomes. From its inception in 1988, PPTI has been a
pioneer in protein design and synthesis, and as a result has achieved an
exceptional proprietary position in protein-based materials technology.
PPTI's biocompatible polymers have been genetically engineered to enable
cell growth, promote the regeneration of tissue, bond to natural and synthetic
surfaces, and resorb into tissue at controlled rates. Targeted applications
include soft tissue augmentation, tissue adhesives and sealants, tissue
engineering and wound healing, and localized drug delivery.
This press release may contain forward-looking statements
that are based on management's expectations. Actual results could
differ materially from those expressed here; further, the Company is not
obligated to comment specifically on those differences. Risks associated
with the Company's activities include scientific and product development
uncertainties, competitive products and approaches, continuing collaborative
partnership interest and funding, regulatory testing and approvals, and
manufacturing scale-up. The reader is encouraged to refer to the Company's
1997 Annual Report and 10-KSB, and recent filings with the Securities and
Exchange Commission, copies of which are available from the Company, to
further ascertain the risks associated with the above statements.
Protein Polymer Technologies, Inc.
Condensed Financial Statements
(unaudited)
Three months ended Six months ended
June 30, June 30,
SUMMARY OF OPERATIONS 1998 1997 1998 1997
Contract revenue $--- $95,750 $50,000 $233,000
Interest income 39,909 59,289 48,565 121,734
Product and other income 5,506 15,300 34,295 33,904
Total revenues 45,415 170,339 132,860 388,638
Total expenses 1,495,632 1,350,905 2,860,314 2,446,560
Net loss $(1,450,217) $(1,180,566) $(2,727,454) $(2,057,922)
Undeclared, imputed
and/or paid dividends
on Preferred Stock 3,335,936 122,630 3,405,503 243,912
Net loss applicable
to common
shareholders $(4,786,153) $(1,303,196) $(6,132,957) $(2,301,834)
Net loss per common
share -
basic and diluted $(0.46) $(0.14) $(0.59) $(0.25)
Shares used in computing
net loss per share -
basic and diluted 10,455,953 9,148,593 10,442,598 9,092,163
As of As of
June 30, 1998 Dec. 31, 1997
BALANCE SHEET INFORMATION (audited)
Cash, cash equivalents and
short-term investments $3,991,954 $1,299,838
Working capital 3,400,001 697,020
Total assets 4,904,439 2,347,887
Total capital invested 34,201,951 25,549,644
Accumulated deficit (30,077,215) (24,083,511)
