Microbix Biosystems Inc.: Microbix Reports Strong Results for Q2 Fiscal 2024

MISSISSAUGA, Ontario, May 15, 2024 (GLOBE NEWSWIRE) -- Microbix Biosystems Inc. (TSX: MBX, OTCQX: MBXBF, Microbix®), a life sciences innovator, manufacturer, and exporter, reports results for its second quarter and first half of fiscal 2024 ended March 31, 2024 ("Q2" and "H1"), with strong growth in sequential and year-over-year quarterly revenues, reflective of ongoing progress to increase sales from its diagnostic-test related ingredients and devices businesses and resulting in net income for Q2 and H1.

Management Discussion
Results for Q2 show robust growth in sales of Microbix's test ingredients ("Antigens") and test quality assessment products ("QAPs"), which were collectively up by 34% versus prior year. The resulting revenues of over C$ 5.6 million led to meaningful net earnings and continue to set the stage for a record full-year fiscal 2024. Microbix believes sales growth will continue for Antigens and QAPs, alongside satisfactory progress of Kinlytic toward FDA re-approval and re-launch into the U.S. market.

Quarter ending March 31, 2024 ("Q2")
Q2 revenue was $5,632,901, a 34% increase from Q2 2023 revenues of $4,218,323. Antigen sales grew by 37% to $4,111,462 (2023 - $3,004,730), while QAPs grew by 27% to $1,399,596 (2023 - $1,101,684). Revenue from royalties increased to $121,843 (2023 - $111,910).

Q2 gross margin was 53%, down from Q2 2023 gross margins of 60%. Gross margins were primarily impacted by product mix and and increased weighting of Antigen revenues during the quarter. Operating and finance expenses in Q2 increased by 4% relative to Q2 2023. Q2 costs reflect the ongoing costs of our IT systems upgrades which began in the latter half of fiscal 2023 and amortization charges relating to the reversal of the impairment of the Kinlytic intangible asset which began at the end of fiscal 2023.

Increased sales and higher gross margin dollars led to an operating income and net income of $377,730 versus a Q2 2023 operating income and net income of $31,616. Cash provided by operating activities was $839,245, compared to cash used in operating activities of ($1,055,856) in Q2 2023.

Period ending March 31, 2024 ("H1")
H1 revenue was $14,040,785, a 109% increase from H1 2023 revenues of $6,720,395. Included were antigen revenues of $6,065,138 (2023 - $4,008,537), up 51% from last year. QAPs revenues of $3,647,832 were up 51% from H1 2023 (2023 - $2,435,186), due in large part to the more than doubling of sales of our branded PROCEEDx® and REDx QAPs products. Revenue from royalties were $241,155 (2023 - $276,672).

H1 revenues were also greatly influenced by the recognition of $4,086,000 in Kinlytic licensing milestone payments (2023 - nil). In summary, the H1 2024 sales growth result was driven by Kinlytic licensing revenues and significant growth in both our Antigens and QAPs businesses.

H1 gross margin was 65%, up from 55% in H1 2023, primarily due to the impact of Kinlytic licensing revenues and stronger QAPs revenues. Operating expenses in H1 increased by 28% relative to H1 2023, principally due to US$ 500,000 in investment-banking fees related to our Kinlytic licensing agreement that were absorbed into G&A in accordance with IFRS accounting practices. In addition, H1 costs reflect the on going costs of our IT systems which began in the latter half of fiscal 2023 and amortization relating to the reversal of the impairment of the Kinlytic intangible asset, which began at the end of fiscal 2023.

Overall, strong H1 revenues led to an operating income and net income of $2,833,109 versus a H1 2023 operating loss and net loss of $1,267,647. Cash provided by operating activities was $2,178,196, compared to cash used in operating activities of $1,769,723 in H1 2023, with much of the change coming from operating income and changes in working capital balances during the period.

At the end of Q2, Microbix's current ratio (current assets divided by current liabilities) was 6.64 and its debt to equity ratio (total debt over shareholders' equity) was 0.37, both measures having improved from the prior year second quarter (Q2 2023) and the preceding fiscal year end (Q4 2023).

FINANCIAL HIGHLIGHTS
		Three months ended							Six months ended
For the three months and six months ended		March 31, 2024			March 31, 2023				March 31, 2024			March 31, 2023
Total Revenue		$	5,632,901		$	4,218,323			$	14,040,785		$	6,720,395
Gross Margin			2,970,969			2,527,280				9,193,301			3,713,255
SG&A Expenses			2,016,032			1,878,420				5,184,281			3,841,622
R&D Expense			495,881			525,925				980,100			950,883
Financial Expenses			81,326			91,319				195,811			188,397
Operating Income (Loss) for the period			377,730			733,489				2,833,109			1,614,267
Net Income (Loss) and Comprehensive Income (Loss) for the period			377,730			31,616				2,833,109			(1,267,647	)
Cash Provided (Used) by Operating Activities			839,245			(1,055,856	)			2,178,196			(1,769,723	)
As at		March 31, 2024			September 30, 2023
Cash			12,873,087			11,606,487
Accounts receivable			4,407,630			4,119,771
Total current assets			24,683,176			22,302,006
Total assets			37,922,214			35,653,024
Total current liabilities			3,718,551			4,349,942
Total liabilities			10,165,806			11,028,537
Total shareholders' equity			27,756,408			24,624,487
Current ratio			6.64			5.13
Debt to equity ratio			0.37			0.45

Corporate Outlook
Microbix will continue to drive sales growth across all of its business lines, and work to keep improving percentage gross margins and driving bottom-line results. Management currently expects Microbix to generate meaningful year-over-year growth in revenues and net earnings across full-year fiscal 2024.

Furthermore, at 10:00 AM ET on Wednesday May 15th, Microbix intends to hold a webinar discussion of Q2 2024 results with its CEO, CFO, and COO.

Investors and shareholders can participate in the webinar, hosted by Adelaide Capital, by registering at: https://us02web.zoom.us/webinar/register/WN_imQCaP3DTQC-1oGUSfs85g.

It will also be live-streamed to YouTube at: https://www.youtube.com/channel/UC7Jpt_DWjF1qSCzfKlpLMWw.

A replay of the webinar will also be made available on Adelaide Capital's YouTube channel.

About Microbix Biosystems Inc.
Microbix Biosystems Inc. creates proprietary biological products for human health, with over 100 skilled employees and annualized revenues approaching C$ 2.0 million per month. It enables the worldwide commercialization of diagnostic assays by making a wide range of critical ingredients and devices for the global diagnostics industry, notably antigens for immunoassays and its laboratory quality assessment products (QAPs) that support clinical lab proficiency testing, enable assay development and validation, or help ensure the quality of clinical diagnostic workflows. Its antigens drive the antibody tests of approximately 100 diagnostics makers, while QAPs are sold to clinical lab accreditation organizations, diagnostics companies, and clinical labs. Microbix QAPs are now available in over 30 countries, supported by a network of international distributors. Microbix is ISO 9001 & 13485 accredited, U.S. FDA registered, Australian TGA registered, Health Canada establishment licensed, and provides CE marked products.

Microbix also applies its biological expertise and infrastructure to develop other proprietary products and technologies, most notably Kinlytic® urokinase, a biologic thrombolytic drug used to treat blood clots, and reagents or media to support molecular diagnostic testing (e.g., its DxTM for patient-sample collection). Microbix is traded on the TSX and OTCQX, and headquartered in Mississauga, Ontario, Canada.

Forward-Looking Information
This news release includes "forward-looking information," as such term is defined in applicable securities laws. Forward-looking information includes, without limitation, discussion of financial results or the outlook for the business, risks associated with its financial results and stability, its current or future products, development projects such as those referenced herein, sales to foreign jurisdictions, engineering and construction, production (including control over costs, quality, quantity and timeliness of delivery), foreign currency and exchange rates, maintaining adequate working capital and raising further capital on acceptable terms or at all, and other similar statements concerning anticipated future events, conditions or results that are not historical facts. These statements reflect management's current estimates, beliefs, intentions, and expectations; they are not guarantees of future performance. The Company cautions that all forward looking information is inherently uncertain, and that actual performance may be affected by many material factors, some of which are beyond the Company's control. Accordingly, actual future events, conditions and results may differ materially from the estimates, beliefs, intentions, and expectations expressed or implied in the forward-looking information. All statements are made as of the date of this news release and represent the Company's judgement as of the date of this new release, and the Company is under no obligation to update or alter any forward-looking information.

Please visit www.microbix.com or www.sedarplus.ca for recent Microbix news and filings.

For further information, please contact Microbix at:

Cameron Groome, CEO [phone]

Jim Currie, CFO [phone]

Deborah Honig, Investor Relations Adelaide Capital Markets [phone] [e-mail]

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Microbix®, DxTM, Kinlytic®, & QAPs are trademarks of Microbix Biosystems Inc.