SQI Diagnostics Reports First Quarter 2022 Results

Rhea-AI Summary

SQI Diagnostics Inc. (TSXV: SQD) (OTCQB: SQIDF) reported financial results for Q1 2022, showing sales of $0.06M, down from $0.16M in Q1 2021, mainly due to production issues and a strategic exit from the Lifesciences sector. Gross profit decreased to $0.05M from $0.1M a year prior. SG&A expenses were $1.7M, slightly down from $1.8M, while R&D expenses remained stable at $1.7M. Cash reserves totaled $3.4M. The company completed a private placement of $5.1M and acquired Precision Biomonitoring’s diagnostics business for $6.8M.

Positive

• Acquisition of Precision Biomonitoring's diagnostics business for $6.8M, enhancing product offerings.
• Successful completion of a private placement raising $5.1M, improving liquidity.

Negative

• Sales decreased by 62.5% to $0.06M from $0.16M due to production issues.
• Gross profit fell to $0.05M from $0.1M, indicating reduced profitability.

TORONTO, Feb. 28, 2022 /PRNewswire/ - SQI Diagnostics Inc. (TSXV: SQD) ( OTCQB: SQIDF), a leader in the science of lung health that develops and manufactures respiratory health and precision medicine tests today reported their financial and operational results for the first quarter for fiscal year ending September 30, 2022.

"SQI continues to make new acquisitions and position itself for growth in new lines of business," said Andrew Morris, President and CEO of SQI Diagnostics. "We are excited to attract a broader array of new customers, to engage in more cross-selling opportunities and use accretive acquisition to support the aggressive launch of our lung health products." 

Q1 2022 Financial Highlights

• Sales were $0.06M in Q1 2022, compared to $0.16M in Q1 2021. The decrease in sales is mainly due to a production equipment issue that impacted shipment of products during the quarter and a strategic exit from the Lifesciences business as we focus on our larger revenue markets in our lung health product and services business
• Gross profit was $0.05M in Q1 2022, compared to $0.1M in Q1 2021
• SG&A expense was $1.7M in Q1 2022, compared to $1.8M in Q1 2021. The decrease in SG&A expense can be attributed to lower overhead expenses for sales as well as lower consulting costs for external contractors that were engaged in the previous year to help support the regulatory submission process.
• R&D expense was $1.7M in Q1 2022, compared to $1.8M in Q1 2021.
• Cash and cash equivalents were $3.4M as of December 31, 2021
• Net working capital was $2.7M as of December 31, 2021, compared to $0.7M on September 30, 2021

Corporate Highlights during the Quarter:

• The company completed its submission of RALI-Dx™ IL-6 Severity Triage Test for an Interim Order to Health Canada
• The company completed a private placement of 26.9M units of the Company's shares at $0.19 per unit, for gross proceeds of $5.1M
• Following the quarter, the Company completed the acquisition of Precision Biomonitoring Inc's human diagnostics COVID-19 PCR and Rapid Antigen testing business and its TripleLock molecular diagnostic testing technology for consideration of $6.8M, including $6.2M in cash.  

About SQI Diagnostics

SQI Diagnostics is a leader in the science of lung health. The Company develops and manufactures respiratory health and precision medicine tests that run on SQI's fully automated systems. The Company's tests simplify and improve COVID19 antibody monitoring, Rapid Acute Lung Injury testing, donor organ transplant informatics, and immunological protein and antibody testing. SQI Diagnostics is driven to create and market life-saving testing technologies that help more people in more places live longer, healthier lives. For more information, please visit www.sqidiagnostics.com.

Contact:

Chief Financial Officer
Morlan Reddock
416.674.9500 ext. 277
mreddock@sqidiagnostics.com

FORWARD-LOOKING INFORMATION

This press release contains certain words and statements, which may constitute "forward-looking statements" within the meaning of applicable securities laws relating to future events or future performance and reflect the current expectations and assumptions of the Company regarding its growth, results of operations, performance, business prospects and opportunities. These statements generally can be identified by use of forward-looking words such as "may", "would", "could", "will", "should", "expect", "plan", "estimate", "anticipate", "intends", "believe", "potential", or "continue" or the negative thereof or similar variations. The Company's actual results and performance discussed herein could differ materially from those expressed or implied by such statements. Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations. Important factors that could cause actual results to differ materially from expectations include, among other things, general economic and market factors, competition, the effect of the global pandemic and consequent economic disruption, and the factors detailed in the Company's ongoing filings with the securities regulatory authorities, available at www.sedar.com. Although the forward-looking statements contained herein are based on what we consider to be reasonable assumptions based on information currently available to us, there can be no assurance that actual events, performance or results will be consistent with these forward looking statements, and our assumptions may prove to be incorrect. Readers are cautioned not to place undue reliance on these forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements either as a result of new information, future events or otherwise, except as required by applicable law.

Neither 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.

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SOURCE SQI Diagnostics Inc.

FAQ

What were SQI Diagnostics' Q1 2022 sales figures?

SQI Diagnostics reported sales of $0.06M in Q1 2022, down from $0.16M in the same quarter of the previous year.

How much cash did SQI Diagnostics have at the end of Q1 2022?

As of December 31, 2021, SQI Diagnostics had cash and cash equivalents totaling $3.4M.

What are the main reasons for SQI Diagnostics' sales decline in Q1 2022?

The decline in sales was primarily due to production equipment issues and a strategic exit from the Lifesciences business.

What acquisition did SQI Diagnostics make recently?

SQI Diagnostics acquired Precision Biomonitoring's human diagnostics COVID-19 testing business for $6.8M.

What is SQI Diagnostics' SG&A expense in Q1 2022?

The SG&A expense for SQI Diagnostics in Q1 2022 was $1.7M, slightly lower than $1.8M in Q1 2021.