GLG Life Tech Corporation Reports 2021 Third Quarter Financial Results
GLG Life Tech Corporation (GLGLF) reported a significant decline in revenues for Q3 2021, totaling $2.1 million, a drop of $1.9 million from $4.0 million in Q3 2020. For the first nine months, revenues fell to $7.9 million, down $4.6 million from the prior year. Despite improving gross profit margins (27% in Q3 2021 vs. 18% in Q3 2020), the company incurred a net loss of $7.0 million in Q3 2021, compared to a profit of $21.1 million in Q3 2020. The net loss per share was $0.18. The company continues to face cash flow challenges and manages SG&A expenses effectively to mitigate risks.
- Gross profit margin increased to 27% in Q3 2021 from 18% in Q3 2020.
- Reduction in SG&A expenses in the nine-month period ending September 30, 2021.
- Revenue declined by 47% in Q3 2021 compared to Q3 2020.
- Net loss of $7.0 million in Q3 2021 compared to a net income of $21.1 million in Q3 2020.
- Total revenue for the first nine months dropped to $7.9 million from $12.5 million in 2020.
- The company lacks sufficient cash to fully fund operations and strategic initiatives.
VANCOUVER, BC / ACCESSWIRE / November 15, 2021 / GLG Life Tech Corporation (TSX:GLG) ("GLG" or the "Company"), a global leader in the agricultural and commercial development of high-quality zero-calorie natural sweeteners, announces financial results for the three and nine months ended September 30, 2021. The complete set of financial statements and management discussion and analysis are available on SEDAR and on the Company's website at www.glglifetech.com.
FINANCIAL SUMMARY
The Company reported revenues of
The Company reported revenues of
The Company continues to closely manage its SG&A expenses, resulting in reduced G&A expenses in the nine-month period ending September 30, 2021, relative to the comparable period in 2020. For the three-month period ending September 30, 2021, G&A expenses would have also been lower but for one-time events in each of 2021 (increasing G&A costs) and 2020 (lowering G&A costs).
For the three months ended September 30, 2021, the Company had a net loss attributable to the Company's shareholders of
For the nine months ended September 30, 2021, the Company had a net loss attributable to the Company's shareholders of
CORPORATE DEVELOPMENTS
Company Outlook
Over the past several quarters, management has focused on implementing and continuing plans that have helped stem the losses that the Company suffered in recent years and to ameliorate the Company's financial position. Those efforts have brought some success, as the Company's EBITDA has improved, due largely to significant reductions in SG&A expenses. It remains the case, however, that the Company lacks the cash necessary to fully fund the business operations and its strategic product initiatives. The Company continues to manage its cash flows carefully to mitigate risk of insolvency. Nevertheless, without an infusion of cash in the months ahead, the Company may not be able to realize its strategic plans and could eventually cease to be a going concern.
To address that cash need, management negotiated a CAD
Another factor that continues to contribute to the Company's financial situation is the competitive price pressure in the stevia market over the last two years that has reduced mainstream "Reb A" products (such as Reb A 80 and Reb A 97) to the lowest price levels in years. Monk fruit prices have also become increasingly competitive in the marketplace. To maintain margins at sustainable levels, the Company has focused on improving its production efficiencies and continues to strive a mix of products that is weighted more heavily on higher margin, specialty products.
The Company continues to explore options to significantly improve its balance sheet and cash flows, whether through restructuring of debt or other opportunities for infusions of cash to address the debt load. The Company also continues to explore options that may be complementary to the natural sweetener market, where it could leverage its production expertise and equipment towards an investment that may help grow the Company's revenues and improve its financial position.
While the Company continues to face substantial risks and 2021 remains another pivotal year for the Company, management remains optimistic about the future opportunities for the Company. Having closed the idle asset sale last year and having successfully implemented right-sizing efforts to manage costs, as well as continuing to optimize production efficiencies, costs, and planning, management is proceeding down the best available path to increased financial stability and profitability.
Appointment of Chief Financial Officer
The Company announced the appointment of Edward Wang as Chief Financial Officer, effective November 12, 2021. Mr. Wang, who joined the Company in October 2019, had been serving as Acting Chief Financial Officer since June of 2020.
In view of Mr. Wang's efforts and results in overseeing the Company's financial reporting, cost controls, and financial management of both the Chinese and North American operations, the Board of Directors agreed that Mr. Wang was the right person to continue leading the Company's financial operations. Dr. Zhang expressed: "With Edward's performance since joining the Company - Edward has helped deliver significant savings in our SG&A and has managed the Company's financial reporting professionally and admirably - as a result I have full faith in him to continue driving us towards strong results, to execute on our strategy, and to help take GLG to the next level."
Mr. Wang, who joined the Company in October 2019, had been serving as Acting Chief Financial Officer since June of 2020. He received his Bachelor of Arts in Accounting degree in 1992, Master of Business Administration in 2005, and earned his CPA, CGA in 2010. Prior to joining GLG, Mr. Wang worked in Kraft Foods (China) for eight years and the mining business in both China and Canada for ten years.
2021 AGM Voting Results
The Company held its Annual General Meeting virtually on June 23, 2021. The shareholders voted in all nominated directors, with favorable votes for each exceeding
SELECTED FINANCIALS
As noted above, the complete set of financial statements and management discussion and analysis for the three and nine months ended September 30, 2021, are available on SEDAR and on the Company's website at www.glglifetech.com.
Results from Operations
The following results from operations have been derived from and should be read in conjunction with the Company's annual consolidated financial statements for 2020 and the condensed interim consolidated financial statements for the nine-month period ended September 30, 2021.
| 3 Months Ended September 30 | % Change | 9 Months Ended September 30 | % Change | |||||||||||||||||||||
In thousands Canadian $, except per share amounts | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Revenue | $ | 2,094 | $ | 3,966 | (47 | %) | $ | 7,874 | $ | 12,507 | (37 | %) | ||||||||||||
Cost of Sales | $ | (1,536 | ) | $ | (3,239 | ) | (53 | %) | $ | (5,675 | ) | $ | (9,793 | ) | (42 | %) | ||||||||
% of Revenue | (73 | %) | (82 | %) | 8 | % | (72 | %) | (78 | %) | 6 | % | ||||||||||||
Gross Profit | $ | 558 | $ | 727 | (23 | %) | $ | 2,199 | $ | 2,713 | (19 | %) | ||||||||||||
% of Revenue | 27 | % | 18 | % | 8 | % | 28 | % | 22 | % | 6 | % | ||||||||||||
Expenses | $ | (1,209 | ) | $ | (1,468 | ) | (18 | %) | $ | (3,495 | ) | $ | (5,298 | ) | (34 | %) | ||||||||
% of Revenue | (58 | %) | (37 | %) | (21 | %) | (44 | %) | (42 | %) | (2 | %) | ||||||||||||
(Loss) from Operations | $ | (651 | ) | $ | (742 | ) | 12 | % | $ | (1,296 | ) | $ | (2,586 | ) | 50 | % | ||||||||
% of Revenue | (31 | %) | (19 | %) | (12 | %) | (16 | %) | (21 | %) | 4 | % | ||||||||||||
Other Income (Expenses) | $ | (6,347 | ) | $ | 18,056 | (135 | %) | $ | (14,088 | ) | $ | 25,850 | (154 | %) | ||||||||||
% of Revenue | (303 | %) | 455 | % | (758 | %) | (179 | %) | 207 | % | (386 | %) | ||||||||||||
Net Income (Loss) before Income Taxes | $ | (6,998 | ) | $ | 17,314 | (140 | %) | $ | (15,384 | ) | $ | 23,264 | (166 | %) | ||||||||||
% of Revenue | (334 | %) | 437 | % | (771 | %) | (195 | %) | 186 | % | (381 | %) | ||||||||||||
Net Income (Loss) | $ | (6,998 | ) | $ | 17,314 | (140 | %) | $ | (15,384 | ) | $ | 23,264 | (166 | %) | ||||||||||
% of Revenue | (334 | %) | 437 | % | (771 | %) | (195 | %) | 186 | % | (381 | %) | ||||||||||||
Net Income (Loss) Attributable to Non-Controlling Interest (NCI) | $ | (36 | ) | $ | (3,827 | ) | 99 | % | $ | (95 | ) | $ | 363 | (126 | %) | |||||||||
Net Income (Loss) Attributable to GLG | $ | (6,962 | ) | $ | 21,141 | (133 | %) | $ | (15,289 | ) | $ | 22,901 | (167 | %) | ||||||||||
% of Revenue | (332 | %) | 533 | % | (866 | %) | (194 | %) | 183 | % | (377 | %) | ||||||||||||
Net Income (Loss) per share (LPS, Basic & Diluted) | $ | (0.18 | ) | $ | 0.55 | (133 | %) | $ | (0.40 | ) | $ | 0.60 | (167 | %) | ||||||||||
Other Comprehensive Income (Loss) | $ | (1,625 | ) | $ | 9,154 | (118 | %) | $ | (590 | ) | $ | 6,349 | (109 | %) | ||||||||||
% of Revenue | (78 | %) | 231 | % | (308 | %) | (7 | %) | 51 | % | (58 | %) | ||||||||||||
Comprehensive Net Income (Loss) | $ | (8,623 | ) | $ | 26,468 | (133 | %) | $ | (15,974 | ) | $ | 29,613 | (154 | %) | ||||||||||
Comprehensive Income (Loss) Attributable to NCI | $ | (55 | ) | $ | (2,995 | ) | (98 | %) | $ | (106 | ) | $ | 382 | (128 | %) | |||||||||
Comprehensive Income (Loss) Attributable to GLG | $ | (8,568 | ) | $ | 29,463 | (129 | %) | $ | (15,868 | ) | $ | 29,231 | (154 | %) | ||||||||||
% of Revenue | (409 | %) | 743 | % | (1152 | %) | (202 | %) | 234 | % | (436 | %) | ||||||||||||
Revenue
Revenue for the three months ended September 30, 2021, was
Revenue for the nine months ended September 30, 2021, was
Cost of Sales
For the quarter ended September 30, 2021, the cost of sales was
For the nine months ended September 30, 2021, the cost of sales was
Capacity charges charged to the cost of sales ordinarily would flow to inventory and are a significant component of the cost of sales. Only two of GLG's manufacturing facilities were operating during the first nine months of 2021, and capacity charges of
Gross Profit (Loss)
Gross profit for the three months ended September 30, 2021, was
Gross profit for the nine months ended September 30, 2021, was
Selling, General and Administration Expenses
Selling, General and Administration ("SG&A") expenses include sales, marketing, general and administration costs ("G&A"), stock-based compensation, and depreciation and amortization expenses on G&A fixed assets. A breakdown of SG&A expenses into these components is presented below:
| 3 Months Ended September 30 | % Change | 9 Months Ended September 30 | % Change | |||||||||||||||||||||
In thousands Canadian $ | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
G&A Expenses | $ | 946 | $ | 732 | 29 | % | $ | 2,638 | $ | 3,458 | (24 | %) | ||||||||||||
Stock Based Compensation Expenses | $ | 0 | $ | 45 | (100 | %) | $ | 73 | $ | 315 | (77 | %) | ||||||||||||
Depreciation Expenses | $ | 263 | $ | 691 | (62 | %) | $ | 784 | $ | 1,525 | (49 | %) | ||||||||||||
Total | $ | 1,209 | $ | 1,468 | (18 | %) | $ | 3,495 | $ | 5,298 | (34 | %) | ||||||||||||
G&A expenses for the three months ended September 30, 2021, were
G&A expenses for the nine months ended September 30, 2021, were
Net Loss Attributable to the Company
| 3 Months Ended September 30 | % Change | 9 Months Ended September 30 | % Change | |||||||||||||||||||||
In thousands Canadian $ | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||
Net Income (Loss) | $ | (6,998 | ) | $ | 17,314 | (140 | %) | $ | (15,384 | ) | $ | 23,264 | (166 | %) | ||||||||||
Net Income (Loss) Attributable to NCI | $ | (36 | ) | $ | (3,827 | ) | (99 | %) | $ | (95 | ) | $ | 363 | (126 | %) | |||||||||
% of Revenue | (2 | %) | (96 | %) | 95 | % | (1 | %) | 3 | % | (4 | %) | ||||||||||||
Net Income (Loss) Attributable to GLG | $ | (6,962 | ) | $ | 21,141 | (133 | %) | $ | (15,289 | ) | $ | 22,901 | (167 | %) | ||||||||||
% of Revenue | (332 | %) | 533 | % | (866 | %) | (194 | %) | 183 | % | (377 | %) | ||||||||||||
For the three months ended September 30, 2021, the Company had a net loss attributable to the Company of
For the nine months ended September 30, 2021, the Company had a net loss attributable to the Company of
Quarterly Basic and Diluted Loss per Share
The basic and diluted net loss per share from operations was
The basic and diluted net loss per share from operations was
Additional Information
Additional information relating to the Company, including our Annual Information Form, is available on SEDAR (www.sedar.com). Additional information relating to the Company is also available on our website (www.glglifetech.com).
For further information, please contact:
Simon Springett, Investor Relations
Phone: +1 (604) 669-2602 ext. 101
Fax: +1 (604) 662-8858
Email: ir@glglifetech.com
About GLG Life Tech Corporation
GLG Life Tech Corporation is a global leader in the supply of high-purity zero calorie natural sweeteners including stevia and monk fruit extracts used in food and beverages. GLG's vertically integrated operations, which incorporate our Fairness to Farmers program and emphasize sustainability throughout, cover each step in the stevia and monk fruit supply chains including non-GMO seed and seedling breeding, natural propagation, growth and harvest, proprietary extraction and refining, marketing and distribution of the finished products. Additionally, to further meet the varied needs of the food and beverage industry, GLG, through its Naturals+ product line, supplies a host of complementary ingredients reliably sourced through its supplier network in China. For further information, please visit www.glglifetech.com.
Forward-looking statements: This press release may contain certain information that may constitute "forward-looking statements" and "forward looking information" (collectively, "forward-looking statements") within the meaning of applicable securities laws. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases or words and phrases that state or indicate that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved.
While the Company has based these forward-looking statements on its current expectations about future events, the statements are not guarantees of the Company's future performance and are subject to risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from future results expressed or implied by such forward-looking statements. Such factors include amongst others the effects of general economic conditions, consumer demand for our products and new orders from our customers and distributors, changing foreign exchange rates and actions by government authorities, uncertainties associated with legal proceedings and negotiations, industry supply levels, competitive pricing pressures and misjudgments in the course of preparing forward-looking statements. Specific reference is made to the risks set forth under the heading "Risk Factors" in the Company's Annual Information Form for the financial year ended December 31, 2020. In light of these factors, the forward-looking events discussed in this press release might not occur.
Further, although the Company has attempted to identify factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
As there can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements, readers should not place undue reliance on forward-looking statements.
SOURCE: GLG Life Tech Corporation
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FAQ
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