ProMetic Life Sciences Inc.

ProMetic Life Sciences Inc.

November 14, 2005 16:29 ET

ProMetic Announces Third Quarter and Nine-Month 2005 Financial Results

MONTREAL, CANADA--(CCNMatthews - Nov. 14, 2005) - ProMetic Life Sciences Inc. (TSX:PLI.SV) today reported its financial results for the third quarter and the nine-month period ended September 30, 2005. All amounts are in Canadian dollars unless otherwise indicated.

"A number of value maximization strategies mandated by the Board are underway. Over the course of the year, our technologies have generated great interest from potential strategic and financial partners and we intend to announce these strategies very shortly," said Pierre Laurin, Chairman and CEO.

Positive results for the prion endogenous study as presented at the AABB forum and the FDA advisory committee, shortly after the conclusion of the quarter, confirmed the ability of our PRDT filter to remove infectivity from whole blood. These findings will pave the way for a commercial launch of the product by our European partner, MacoPharma, in 2006.

The Company is pursuing additional sales opportunities stemming from its enabling technology, which it expects to be concluded in the coming months. The company has completed the refurbishment of its state of the art facility located on the Isle of Man. The plant has now the capacity to supply the anticipated growing demand for products.

This quarter's revenues were negatively impacted by a delay in shipment of the Company's products to Hemosol, in relation with our license agreement for the Cascade technology as well as by a foreign exchange loss caused by the significant strengthening of the Canadian dollar. The technology has demonstrated huge yield advantages over existing fractionation processes and the Company will work closely with Hemosol as it explores available options.

In this regard, the Company's 2005 revenue guidance will be decreased at $8 to $9 million.

Third quarter results

The following information should be read in conjunction with the unaudited financial statements for the three-month period and the nine-month period ended September 30, 2005. These interim financial statements have been prepared by the management of ProMetic and have not been subject to an engagement review by the Company's auditors.

Revenues for the third quarter of 2005 reached $0.5 million compared to $1.6 million in the same period last year.

Research and development expenses were $3.1 million during the third quarter compared to $3.6 million. Administration, marketing and other expenses, excluding amortization, were $1.5 million compared to $1.4 million.

A write-down of short-term investment was recorded during the third quarter for an amount of $0.6 million, reflecting the market value of the Hemosol shares held by the Company.

Net loss for the quarter was $5.6 million, or $0.04 per share compared to a net loss of $4.6 million, or $0.05 per share for the same period in 2004.

Cash and cash equivalents totaled $6.9 million as of September 30, 2005.

Nine-month period financial results

For the nine-month period, revenues were $6.8 million compared to $7.3 million in the same period of 2004.

Research and development expenses were $10.8 million compared to $11.8 million. Administration, marketing and other expenses, excluding amortization, were $5.0 million compared to $4.2 million in the same period of 2004.

The cumulative write-down year-to-date of the Hemosol shares held by the Company amounts to $3.8 million.

For the nine-month period, the net loss was $15.1 million or $0.14 per share compared with $11.1 million or $0.11 per share in the same period of 2004.

(In thousands of Canadian dollars)

September 30 December 31
2005 2004
Unaudited Audited


Current assets
Cash and cash equivalents $6,856 $6,770
Short-term investment 1,460 2,340
Accounts receivable 2,145 2,796
Inventories 1,277 921
Prepaid expenses 638 789
12,376 13,616

Investments 5,369 4,479
Capital assets 5,304 5,190
Licenses and patents 5,375 5,430
Deferred development costs 239 990
$28,663 $29,705


Current liabilities
Bank loans $1,617 $1,029
Accounts payable and accrued liabilities 4,577 4,999
Deferred revenues - 243
Current portion of long-term debt 424 440
6,618 6,711
Long-term debt 86 407
Provision related to a lawsuit 2,887 2,715
Preferred shares, retractable
at the holder's option 2,083 1,586
11,674 11,419

Share capital 150,697 135,682
Contributed surplus 159 99
Deficit (133,867) (117,495)
16,989 18,286

$28,663 $29,705

(In thousands of Canadian dollars
except for per share amounts)

Quarter ended Period ended
September 30 September 30
2005 2004 2005 2004
Sales and contract $487 $1,614 $2,836 $2,965
Licensing - - 3,999 4,370
487 1,614 6,835 7,335
Research and development expenses 3,097 3,623 10,819 11,827
Administration, marketing
and other expenses 1,526 1,389 4,987 4,229
Amortization of capital assets 278 290 822 818
Amortization of licenses and
patents and deferred
development costs 392 396 1,177 1,195
5,293 5,698 17,805 18,069
Loss before the following items (4,806) (4,084) (10,970) (10,734)

Write-down of short-term investment (568) (530) (3,810) (530)
Net interest income (expenses) (253) 16 (318) 186
Net loss ($5,627) ($4,598)($15,098)($11,078)

Net loss per share
(basic and diluted) (0.04) (0.05) (0.14) (0.11)

Weighted average number
of outstanding shares
(in thousands) 129,528 99,503 111,063 99,404

About ProMetic Life Sciences

ProMetic Life Sciences Inc. is a biopharmaceutical company specialized in the research, development, manufacture and marketing of a variety of commercial applications derived from its proprietary Mimetic Ligand™ enabling technology. This technology is used in large-scale purification of biologics and the elimination of pathogens. ProMetic is also active in therapeutic drug development with the mission to bring to market effective, innovative, lower cost, less toxic products for the treatment of inflammation and cancer. Its drug discovery platform is focused on replacing complex, expensive proteins with synthetic "drug-like" protein mimetics. Headquartered in Montreal (Canada), ProMetic has R&D and manufacturing facilities in the UK and business development activities in the US, Europe, Asia and MENA countries (Middle East and North Africa).

Additional information is available on the Company's website at

This press release contains forward-looking statements that involve risks and uncertainties, including, but not limited to the Company's ability to develop, manufacture, and successfully commercialize value-added pharmaceutical products and to obtain contracts for its products and services and commercial acceptance of advanced affinity separation technology. You are cautioned that these statements are predictions and that actual events or results may differ materially from those anticipated in these forward-looking statements if known or unknown risks affect our business, or if our estimates or assumptions turn out to be inaccurate. You will find a more detailed assessment of the risks that could cause actual events or results to materially differ from our current expectations on page 15 of the Company's Annual Information Form for the year ended December 31, 2004, under the heading "Risk Factors". As a result, we cannot guarantee that any forward-looking statement will materialize; forward-looking statements do not take into account the effect that transactions or non-recurring items announced or occurring after the statements are made may have on our business. We assume no obligation to update any forward-looking statement even if new information becomes available, as a result of future events or for any other reason.

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