SOURCE: Aeolus Pharmaceuticals

Aeolus Pharmaceuticals

August 14, 2012 17:02 ET

Aeolus Pharmaceuticals Announces Third Quarter Fiscal Year 2012 Financial Results

MISSION VIEJO, CA--(Marketwire - Aug 14, 2012) - Aeolus Pharmaceuticals, Inc. (OTCQB: AOLS) (OTCBB: AOLS)

  • $1.4 million in revenue for third quarter 2012; $5.9 million in revenue for first nine months of fiscal year 2012
  • Two options exercised by BARDA during quarter

Aeolus Pharmaceuticals, Inc., a biotechnology company leveraging significant government funding to develop a platform of novel compounds in oncology and biodefense, announced today financial results for the three months and nine month ended June 30, 2012.

The Company reported a net profit of approximately $3,064,000, or $0.05 per share, which includes a non-cash adjustment of approximately $3,666,000 related to decreases in the fair value of warrants that are included as a component of other income (expense) in the statement of operations, for the three months ended June 30, 2012. This compares to a net profit of $6,293,000, or $0.10 per share, which includes a non-cash adjustment of approximately $7,484,000 related to decreases in the fair value of warrants that are included as a component of other income (expense) in the statement of operations, for the three months ended June 30, 2011. Revenue for the three months ended June 30, 2012 was approximately $1,448,000, which compares to revenue of $1,912,000 for the three months ended June 30, 2011. The revenue is from the collaboration with BARDA announced on February 11, 2011.

"The Company continues to make significant progress under our $118 million advanced research and development contract with BARDA," stated John L. McManus, President and Chief Executive Officer. "During the quarter we began the work on the two recently exercised options, valued at $9.1 million, which include the bulk of the studies needed for our emergency use authorization filing next year."

As of June 30, 2012, the Company had approximately $207,000 in cash and cash equivalents and 62,731,963 common shares outstanding. The Company had accounts receivable of $2,365,000 and accounts payable of $3,240,000 on June 30, 2012. Aeolus has filed today with the SEC its Quarterly Report on Form 10-Q for the quarter ended June 30, 2012. Aeolus urges its investors to read this quarterly filing as well as its amended Annual Report on Form 10-K/A, also filed with the SEC, for further details concerning the Company. The Quarterly Report on Form 10-Q and the amended Annual Report on Form 10-K/A are also available on the Company's website, at http://www.aeoluspharma.com.

About AEOL 10150

AEOL 10150 is a broad-spectrum catalytic antioxidant specifically designed to neutralize reactive oxygen and nitrogen species. The neutralization of these species reduces oxidative stress, inflammation, and subsequent tissue damage-signaling cascades resulting from radiation exposure. AEOL 10150 could have a profound beneficial impact on people who have been exposed, or are about to be exposed, to high-doses of radiation in the treatment of oncology.

AEOL 10150 has already performed well in preclinical and non-clinical studies, was well-tolerated in two human clinical trials, and has demonstrated statistically significant survival efficacy in an acute radiation-induced lung injury model. The Company believes it could have a profound beneficial impact on people who have been exposed, or are about to be exposed, to high-doses of radiation, whether from cancer therapy or a nuclear event.

About Aeolus Pharmaceuticals

Aeolus Pharmaceuticals is developing a new class of catalytic antioxidant compounds that protects healthy tissue from the damaging effects of radiation. Its first compound, AEOL 10150, is being developed for oncology indications, where it is used in combination with radiation therapy. It is also being developed, with funding by the US Government, as a medical countermeasure against chemical and radiological weapons, where its initial target indications are as a protective agent against the effects of acute radiation syndrome and delayed effects of acute radiation exposure. Aeolus' strategy is to leverage the substantial investment in toxicology, manufacturing, and preclinical and clinical studies made by US Government agencies in AEOL 10150, including the contract with BARDA valued, with options, at up to $118.4 million, to efficiently develop the compound for use in oncology.

Forward-Looking Statements

The statements in this press release that are not purely statements of historical fact are forward-looking statements. Such statements include, but are not limited to, those relating to Aeolus' product candidates, as well as its proprietary technologies and research programs, the Company's potential initiation of large efficacy studies, the potential impact of AEOL 10150 and the BARDA Contract. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Aeolus' actual results to be materially different from historical results or from any results expressed or implied by such forward-looking statements. Important factors that could cause results to differ include risks associated with uncertainties of progress and timing of clinical trials, scientific research and product development activities, difficulties or delays in development, testing, obtaining regulatory approval, the need to obtain funding for pre-clinical and clinical trials and operations, the scope and validity of intellectual property protection for Aeolus' product candidates, proprietary technologies and their uses, and competition from other biopharmaceutical companies, and whether BARDA exercises one or more additional options under the BARDA Contract. Certain of these factors and others are more fully described in Aeolus' filings with the Securities and Exchange Commission, including, but not limited to, Aeolus' amended Annual Report on Form 10-K/A for the year ended September 30, 2011. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.

   
   
   
AEOLUS PHARMACEUTICALS, INC.  
CONDENSED CONSOLIDATED BALANCE SHEETS  
(In thousands, except share data)  
   
    June 30,
 2012
    September 30, 2011  
ASSETS                
Current assets:                
  Cash and cash equivalents   $ 207     $ 518  
  Accounts receivable     2,365       1,677  
  Prepaids and other current assets     55       63  
    Total current assets     2,627       2,258  
                     
Investment in CPEC LLC     32       32  
    Total assets   $ 2,659     $ 2,290  
                 
LIABILITIES AND STOCKHOLDERS' DEFICIT                
Current liabilities:                
  Accounts payable and accrued expenses   $ 3,240     $ 2,144  
    Total current liabilities     3,240       2,144  
                 
Warrant liability     12,710       23,405  
    Total liabilities     15,950       25,549  
                 
Commitments and contingencies (Note H)                
                 
Stockholders' deficit:                
  Preferred stock, $.01 par value per share, 10,000,000 shares authorized:                
    Series A nonredeemable convertible preferred stock, 1,250,000 shares authorized as of June 30, 2012 and September 30, 2011, respectively; no shares issued and outstanding as of June 30, 2012 and September 30, 2011, respectively     --       --  
    Series B nonredeemable convertible preferred stock, 1,600,000 and 600,000 shares authorized as of June 30, 2012 and September 30, 2011, respectively; 526,080 and 526,080 shares issued and outstanding as of June 30, 2012 and September 30, 2011, respectively     5       5  
  Common stock, $.01 par value per share, 200,000,000 shares authorized; 62,731,963 and 60,470,718 shares issued and outstanding as of June 30, 2012 and September 30, 2011, respectively     627       605  
  Additional paid-in capital     159,685       158,543  
  Accumulated deficit     (173,608 )     (182,412 )
    Total stockholders' deficit     (13,291 )     (23,259 )
    Total liabilities and stockholders' deficit   $ 2,659     $ 2,290  
   
   
   
AEOLUS PHARMACEUTICALS, INC.  
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS  
(Unaudited)  
(In thousands, except share data)  
   
    Three Months Ended
June 30,
    Nine Months Ended
June 30,
 
    2012     2011     2012     2011  
Revenue:                                
  Contract revenue   $ 1,448     $ 1,912     $ 5,894     $ 2,697  
                                 
Costs and expenses:                                
  Research and development     1,226       1,948       5,223       3,045  
  General and administrative     824       1,155       2,545       2,546  
    Total costs and expenses     2,050       3,103       7,768       5,591  
Loss from operations     (602 )     (1,191 )     (1,874 )     (2,894 )
Non-cash financing charges and change in fair value of warrants (Notes D, E and F)    
3,666
     
7,484
     
 10,678
     
 5,028
 
Interest expense, net     --       --       --       (21 )
Other income, net     --       --       --       337  
Net income   $ 3,064     $ 6,293     $ 8,804     $ 2,450  
                                 
Net income per weighted share attributable to common stockholders:                                
  Basic   $ 0.05     $ 0.10     $ 0.14     $ 0.04  
  Diluted   $ 0.05     $ 0.07     $ 0.12     $ 0.03  
                                 
Weighted average common shares outstanding:                                
  Basic     62,678       60,468       61,210       59,138  
  Diluted     64,919       86,550       73,097       85,220  
   
   
   
AEOLUS PHARMACEUTICALS, INC.  
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS  
(Unaudited)  
(In thousands)  
   
    Nine Months Ended
June 30,
 
    2012     2011  
Cash flows from operating activities:                
  Net income   $ 8,804     $ 2,450  
  Adjustments to reconcile net income to net cash used in operating activities:                
    Stock-based compensation     505       740  
    Change in fair value of warrants     (10,695 )     (5,562 )
    Noncash interest and warrant costs     17       528  
    Change in assets and liabilities:                
      Accounts receivable     (688 )     (466 )
      Prepaid and other assets     8       (30 )
      Accounts payable and accrued expenses     1,096       (402 )
Net cash used in operating activities     (953 )     (2,742 )
                 
Cash flows from financing activities:                
  Proceeds from issuance of common stock and warrants     660       987  
  Costs related to the issuance of common stock and warrants     (18 )     --  
  Proceeds from exercise of warrants     --       283  
Net cash provided by financing activities     642       1,270  
                 
Net decrease in cash and cash equivalents     (311 )     (1,472 )
Cash and cash equivalents at beginning of period     518       2,355  
Cash and cash equivalents at end of period   $ 207     $ 883  
                 
Supplemental disclosure of non-cash financing activities:                
Preferred stock and warrants issued for payment of note payable   $ --     $ 453  
Preferred stock and warrants issued for payment of interest on note payable   $ --     $ 210  
                 
                 

Contact Information

  • Contact:

    Russell Skibsted
    Sr. Vice President and Chief Financial Officer
    Aeolus Pharmaceuticals, Inc.
    1-(949) 481-9825