Kane Biotech Announces First Quarter 2021 Financial Results

Rhea-AI Summary

Kane Biotech reported first quarter 2021 financial results, with revenue from product sales at $254,448, down 4% from 2020 due to COVID-related shutdowns. However, sales to other pet retailers increased by approximately 27%. Total revenue grew by 58% compared to the previous quarter. Gross profit decreased 7% to $165,876, while operating expenses dropped 29% to $1,149,611. The company saw a net loss of ($1,010,892), a 26% improvement year-over-year. CEO Marc Edwards expressed optimism about future growth opportunities and partnerships.

Positive

• Product sales to other retailers grew by approximately 27%.
• Total revenue increased by 58% from the previous quarter.
• Operating expenses decreased by 29%, improving cost management.
• Net loss improved by 26% compared to the same quarter last year.

Negative

• Overall product sales revenue declined by 4% compared to the same quarter last year.
• Gross profit decreased by 7% compared to Q1 2020.

WINNIPEG, Manitoba, May 27, 2021 (GLOBE NEWSWIRE) -- Kane Biotech Inc. (TSX- V:KNE; OTCQB:KNBIF) (the “Company” or “Kane Biotech”), today announced first quarter 2021 financial results.

First Quarter Financial Highlights

• Revenue from product sales in the three months ended March 31, 2021 was $254,448, a decrease of 4% compared to $263,850 in the three months ended March 31, 2020. This decrease is due mainly to the permanent COVID-related store shutdowns across the US at one of the Company’s major pet retail customers. Partially offsetting this, the Company grew its product sales revenue by approximately 27% from other pet retail customers in both Canada and the United States.
  
  
• Revenue from product and services sales grew by 58% in the three months ended March 31, 2021 compared to the three months ended December 31, 2020 due mainly to growth in pet retail channel demand and increased product availability as well as increased demand for contract manufacturing services from Dechra.

• Gross profit for the first quarter of 2021 was $165,876, a decrease of 7% compared to $179,416 for the quarter ended March 31, 2020.
  
  
• Total Operating expenses for the three months ended March 31, 2021 were $1,149,611, a decrease of 29% compared to $1,624,152 for the quarter ended March 31, 2020.
  
  
• Loss for the first quarter of 2021 was ($1,010,892) a decrease of 26% compared to ($1,363,836) for the quarter ended March 31, 2020.
  

Detailed financial information about Kane Biotech can be found in its March 31, 2021 Financial Statements and Management Discussion and Analysis on SEDAR and the Company’s website.

“I’m pleased with our team’s ongoing commitment to successfully execute to plan in the first quarter,” commented Kane Biotech’s Chief Executive Officer, Marc Edwards. “Exciting new growth opportunities lie ahead for our STEM animal health JV and for the expansion of our partnerships in North America and overseas. Our direct-to-consumer products, or OTC, will broaden our DermaKB™ hair product lines and introduce new applications to address the same biofilm problems present in other conditions such as acne or minor cuts and scrapes. Our wound care business is focused on attacking or separating biofilm to facilitate treatment – we are actively discussing potential partnerships with several companies, from the smaller aggressive young companies, to established multinationals. We expect to conclude negotiations with our preferred partner in the coming quarters.”

Recent Corporate Developments:

• On April 29, 2021, Kane Biotech announced that it had published strong positive results from a recent consumer trial of its DermaKB™ products. An average of 82% of participants saw, an improvement in their symptoms using both the Detoxifier and the Shampoo, with an average 33% reduction in the severity of symptoms after using only a three oz. sample of either product.
  
  
• On April 13, 2021, Kane Biotech announced that Dr. Allan Mandelzys has been engaged as an advisor to Kane Biotech’s Board of Directors and will be nominated for Board directorship at the Company’s upcoming Annual and Special Meeting of Shareholders to be held on May 26, 2021.   Dr. Mandelzys was subsequently elected as a director at the May 26, 2021 AGM.
  
  
• On March 10, 2021 Kane Biotech announced that preliminary analysis of data from efficacy trials for STEM’s pet oral care water additive have met the primary endpoint. As previously disclosed, two milestone payments to STEM from STEM’s licensing partners are dependent on positive clinical efficacy data and certification from an industry leading body.
  
  
• On February 24, 2021 the Company announced current Board member Mark Nawacki will take over as Chairman of the Board, and Philip Renaud will assume the role of Vice Chair.
  
  
• On April 16, 2021, the Company received a milestone payment of $125,000 USD from Dechra related to the successful production of a pilot batch of product manufactured in South America.
  
  
• The Company has recently received proceeds of $756,000 related to the exercises of 4.2 million warrants that had an exercise price of $0.18.
  

Kane Biotech is pleased to invite all interested parties to participate in a conference call on Thursday, May 27, 2021 at 4.30pm ET during which time the results will be discussed.

Conference Call details:

Webcast Link: https://edge.media-server.com/mmc/p/hasxid48

Participant Dial In:
Participant Toll-Free Dial-In Number:	(877) 268-9044
Participant International Dial-In Number:	(706) 679-2995
Conference ID: 9992154
Telco Replay (7 Days valid after the live call)
Toll Free Encore:	855 859-2056
Toll Encore:	404 537-3406
Conference ID: 9992154

A live and archived audio webcast of the conference call will also be available on the investor relations page of Kane Biotech’s corporate website. www.kanebiotech.com

About Kane Biotech Inc.

Kane Biotech is a biotechnology company engaged in the research, development and commercialization of technologies and products that prevent and remove microbial biofilms. The Company has a portfolio of biotechnologies, intellectual property (54 patents and patents pending, trade secrets and trademarks) and products developed by the Company's own biofilm research expertise and acquired from leading research institutions. StrixNB™, DispersinB®, Aledex™, bluestem™, bluestem®, silkstem™, goldstem™, coactiv+™, coactive+®, DermaKB™ and DermaKB Biofilm™ are trademarks of Kane Biotech Inc. The Company is listed on the TSX Venture Exchange under the symbol "KNE" and on the OTCQB Venture Market under the symbol “KNBIF”.

For more information, please visit www.kanebiotech.com, or contact:

Marc Edwards	Ray Dupuis	Graham Farrell
Chief Executive Officer	Chief Financial Officer	Investor Relations
Kane Biotech Inc	Kane Biotech Inc	Harbor Access LLC
medwards@kanebiotech.com	rdupuis@kanebiotech.com	Graham.Farrell@HarborAccessllc.com
+1 (514) 910-6991	+1 (204) 298-2200	+1 (416) 842 9003

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Caution Regarding Forward-Looking Information

This press release contains certain statements regarding Kane Biotech Inc. that constitute forward-looking information under applicable securities law. These statements reflect management’s current beliefs and are based on information currently available to management. Certain material factors or assumptions are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. These risks and uncertainties include, but are not limited to, risks relating to the Company’s: (a) financial condition, including lack of significant revenues to date and reliance on equity and other financing; (b) business, including its early stage of development, government regulation, market acceptance for its products, rapid technological change and dependence on key personnel; (c) intellectual property including the ability of the Company to protect its intellectual property and dependence on its strategic partners; and (d) capital structure, including its lack of dividends on its common shares, volatility of the market price of its common shares and public company costs. Further information about these and other risks and uncertainties can be found in the disclosure documents filed by the Company with applicable securities regulatory authorities, available at www.sedar.com. The Company cautions that the foregoing list of factors that may affect future results is not exhaustive.

COVID-19 Pandemic

Since December 31, 2019, the COVID-19 outbreak of the novel strain of coronavirus, SARS- CoV-2, has resulted in a widespread health crisis that has affected economies and financial markets around the world resulting in an economic downturn. The effects of this pandemic on the Company may include decreased customer demand, interruptions to supply chains, manufacturing activities and research and development programs and increased government regulations or interventions. The duration and impact of the COVID-19 outbreak is unknown at this time and it is not possible to reliably estimate the length and severity of these developments nor the impact of these developments on the financial results and condition of the Company in future periods.

KANE BIOTECH INC.
Selected Financial Results
Statement of Comprehensive Loss	Three months ended March 31
		2021				2020
Total Revenue	$	376,039			$	456,139
Gross Profit		165,876				179,416
Operating expenses
General and administration		826,266				1,018,745
Research		320,345				605,407
Total operating expenses		1,146,611				1,624,152
Loss from operations	$	(983,735	)		$	(1,444,736	)
Loss and comprehensive loss for the period	$	(1,010,892	)		$	(1,363,836	)
Loss and comprehensive loss for the period
attibutable to shareholders	$	908,467			$	(1,363,836	)
Basic and diluted loss per share for the period	$	(0.01	)		$	(0.01	)
Weighted average shares outstanding - basic
and diluted		108,624,524				104,411,411
Statement of Financial Position	March 31,				December 31,
		2021				2020
Cash and cash equivalents	$	632,780			$	1,007,923
Other current assets		1,507,157				1,730,687
Non-current assets		2,321,960				2,297,009
Total Assets	$	4,461,897			$	5,035,619
Current liabilities	$	3,098,688			$	2,924,174
Non-current liabilities		1,052,044				1,036,709
Shareholders' equity		311,165				1,074,736
Total liabilities and shareholders' equity	$	4,461,897			$	5,035,619

 Source: Kane Biotech Inc.

FAQ

What were Kane Biotech's first quarter 2021 revenue figures?

Kane Biotech reported first quarter 2021 revenue from product sales of $254,448, a decrease of 4% from $263,850 in Q1 2020.

How did Kane Biotech's operating expenses change in Q1 2021?

Kane Biotech's operating expenses decreased by 29% to $1,149,611 in Q1 2021 compared to $1,624,152 in Q1 2020.

What is the net loss reported by Kane Biotech for the first quarter of 2021?

Kane Biotech reported a net loss of ($1,010,892) in the first quarter of 2021, which was a 26% improvement compared to the loss of ($1,363,836) in Q1 2020.

What growth opportunities is Kane Biotech exploring?

Kane Biotech is focused on growth opportunities in its STEM animal health joint venture and expanding partnerships in North America and overseas.

How did Kane Biotech's sales perform in relation to COVID impacts?

While overall sales were affected by COVID-related store shutdowns at a major retailer, Kane Biotech experienced a 27% increase in product sales from other pet retail customers.