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ViRexx Provides Operational Update and Reports 2003 Financial Results.

Business Editors

EDMONTON, Alberta--(BUSINESS WIRE)--May 6, 2004

ViRexx Medical Corp. (TSX VENTURE:VIR) ("ViRexx" or the "Company") is pleased to provide an operational update and announce financial results for the year ended December 31, 2003.

"We are excited to start 2004 as a well financed public company and look forward to advancing our products in cancer and hepatitis into the clinic over the coming quarters," commented Dr. Antoine Noujaim, President and CEO of ViRexx.


Operational Highlights

- Initiation of manufacturing of clinical materials for a planned
 Phase I trial for Occlusin(TM) Injection in Q3 2004
- Establishment of proof of principle of HepaVaxx B with ex vivo and
 in vivo studies
- Solidification of management team with appointment of Dr. Irwin
 Griffith as Vice President, Drug Development
- Appointment of Dr. Jean-Claude Gonneau and Mr. Douglas Gilpin to
 Board of Directors
- Completion of private and public offerings for total proceeds of
 $12.8 million
- Award of a $500,000 Phase 3 Technology Commercialization Award from
 Alberta Heritage Foundation for Medical Research



Financial Highlights

For the year ended December 31, 2003, the Company reported a consolidated net loss of $1,383,562 compared to a consolidated net loss of $1,260,472 for the year ended December 31, 2002. The increase in the consolidated loss in 2003 resulted from increased research and development expenses related to increased staff and continued development of the Company's products. Research and development costs increased by $76,102 to $989,632 for the year ended December 31, 2003.

General and administrative expenses for the year ended December 31, 2003 totaled $923,632, an increase of $76,102 from the $853,435 recorded for the year ended December 31, 2002. The expenses for the 2003 period include a stock-based compensation expense of $211,300. Accrued interest associated with the convertible debenture totaled $76,052 for the year ended December 31, 2003; an increase of $36,344 compared to $39,708 for the year ended December 31, 2002. The increase in accrued interest in 2003 is due to the compounding effects of the security and the accrual of interest over the full 12-month period.

Revenue increased by $81,527 to $162,277 for the year ended December 31, 2003 as compared to $80,750 for 2002. Revenue consisted of $154,780 related to Industrial Research Assistance Program grants from the National Research Council of Canada and $7,497 from interest.

At December 31, 2003, the Company's cash and cash equivalents totaled $2,708,599 as compared to $131,362 at December 31, 2002. The Company's net cash used in operating activities amounted to $412,752 for the year ended December 31, 2003 and reflects the Company's use of cash to fund its net operating losses and the net changes in non-cash working capital balances. On April 15, 2004 ViRexx completed a public offering of common shares for gross proceeds of $8.8 million.

Notice of AGM

ViRexx will be holding its Annual and Special General Meeting of Shareholders at 3:00pm MST on June 17th, 2004 at the Royal Glenora Club in Edmonton, Alberta.

On behalf of ViRexx:

Dr. Antoine Noujaim

President & CEO

About ViRexx

ViRexx is an Edmonton, Alberta based biotechnology company focused on the development of novel and unique therapeutic products for the treatment of chronic Hepatitis B, Hepatitis C and selected solid tumors. For additional information, please visit www.virexx.com.

This news release contains certain forward-looking statements that reflect the current views and/or expectations of the Company with respect to its performance, business and future events. Such statements are subject to a number of risks, uncertainties and assumptions. Actual results and events may vary significantly.


ViRexx Medical Corp.

Balance Sheet
----------------------------------------------------------------------
----------------------------------------------------------------------
(Canadian dollars)

 As at December 31,
 2003 2002
 $ $

Assets

Current assets:
 Cash and cash equivalents 2,708,599 131,362
 Accounts receivable 52,082 38,622
 Goods & services tax recoverable 56,231 20,972
 Income tax recoverable - 8,436
 Share subscription receivable 37,500 200,000
 Investment tax credits recoverable 447,013 367,354
 Prepaid expenses and other assets 4,958 6,714
----------------------------------------------------------------------
 3,306,383 773,460

Property and equipment 173,800 130,609
Patents, licenses and trademarks 261,726 188,985
----------------------------------------------------------------------
 3,741,909 1,093,054

Liabilities

Current liabilities:
 Accounts payable and accrued liabilities 1,131,154 492,669
 Convertible Debenture 480,365 -
----------------------------------------------------------------------
 1,611,519 492,669
Advances from related parties 35,341 21,973
Convertible debenture - 634,708
----------------------------------------------------------------------
 1,646,860 1,149,350

Shareholders' Equity

 Share capital 5,808,817 2,303,530
 Contributed Surplus 85,000 -
 Equity component of convertible debenture 59,118 90,000
 Deficit (3,857,886) (2,449,826)
----------------------------------------------------------------------
 2,095,049 (56,296)
----------------------------------------------------------------------
 3,741,909 1,093,054
----------------------------------------------------------------------
----------------------------------------------------------------------



ViRexx Medical Corp.

Statement of Loss
----------------------------------------------------------------------
----------------------------------------------------------------------
(Canadian dollars)

 For Twelve Months Ended December 31,

 2003 2002
 $ $

Revenues

Interest income 7,497 -
Government grants 154,780 80,750
----------------------------------------------------------------------
 162,277 80,750

Expenses

Research & development 989,328 738,802
Corporate administration and marketing 680,736 815,934
Debenture interest 76,052 39,708
Stock based compensation 211,300 -
Deprecation and amortization 31,596 37,501
----------------------------------------------------------------------
 1,989,012 1,631,945

 (1,826,735) (1,551,195)
----------------------------------------------------------------------

Other income (expense)

Scientific research and experimental
 development tax credits 451,475 386,414
Gain on foreign exchange 4,401 (1,361)
Loss on sale of property and equipment (12,703) (94,972)
----------------------------------------------------------------------
 443,173 290,081

Loss before income taxes (1,383,562) (1,261,114)
Income taxes (recovery) - (642)
----------------------------------------------------------------------
Net loss for the period (1,383,562) (1,260,472)
----------------------------------------------------------------------

 0.15 0.14
----------------------------------------------------------------------


Statement of Deficit
----------------------------------------------------------------------
----------------------------------------------------------------------
(Canadian dollars)

 For Twelve Months Ended December 31,

 2003 2002
 $ $

Balance - Beginning of period (2,449,826) (1,189,354)

Assumed on business combination (24,498) -

Net loss for period (1,383,562) (1,260,472)
----------------------------------------------------------------------

----------------------------------------------------------------------
Balance - End of period (3,857,886) (2,449,826)
----------------------------------------------------------------------



ViRexx Medical Corp.

Statement of Cash Flows
----------------------------------------------------------------------
----------------------------------------------------------------------
(Canadian dollars)

 For Twelve Months Ended December 31,

 2003 2002
 $ $

Cash provided by (used in)
 Operating activities

Net loss for the period (1,383,562) (1,260,472)
Items not affecting cash
 Debenture interest 76,052 39,708
 Depreciation and amortization 31,596 37,501
 Stock based compensation 211,300 -
 Loss on disposal of property and equipment 12,703 94,972
----------------------------------------------------------------------
 (1,051,911) (1,088,291)

Net change in non-cash working capital items
 Decrease (increase) in accounts
 receivable (13,460) (37,437)
 Decrease (increase) in goods and
 services tax recoverable (27,784) 16,685
 Decrease (increase) in share subscriptions
 receivable 162,500 (197,163)
 Decrease (increase) in investment tax
 credits recoverable (79,659) (17,744)
 Decrease (Increase) in prepaid expense 1,756 (6,383)
 Decrease (increase) in income taxes
 recoverable 8,436 (8,436)
 Increase (decrease) in accounts payable
 and accrued liabilities 587,370 56,902
 Increase (decrease) in income tax payable - (642)
----------------------------------------------------------------------
 (412,752) (1,282,509)
----------------------------------------------------------------------

Financing activities

Note payable - (25,000)
Issuance of share capital 3,117,710 1,012,163
Advances from shareholders - (193,307)
Amounts due to related parties 13,368 21,973
Issuance (conversion) of convertible debenture - 685,000
----------------------------------------------------------------------
 3,131,078 1,500,829
----------------------------------------------------------------------

Investment activities

Acquisition of property and equipment (94,616) (97,222)
Expenditures on patents and trademarks (74,824) (94,633)
Cash acquired on amalgamation 19,142 -
Proceeds on sale of capital assets 9,210 -
----------------------------------------------------------------------
 (141,088) (191,855)
----------------------------------------------------------------------

Increase in cash 2,577,237 26,465
Cash and cash equivalents -
 Beginning of year 131,362 104,897
----------------------------------------------------------------------
Cash and cash equivalents -
 End of year 2,708,599 131,362
----------------------------------------------------------------------
----------------------------------------------------------------------


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