UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
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(Mark One) |
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended September 30, 2004. |
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OR |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from ____________________ to ____________________ |
Commission file number: 0-27718
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NEOSE TECHNOLOGIES, INC. |
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(Exact name of registrant as specified in its charter) |
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Delaware |
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13-3549286 |
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(State or other jurisdiction of |
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(I.R.S. Employer |
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102 Witmer Road Horsham, Pennsylvania |
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19044 |
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(Address of principal executive offices) |
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(Zip Code) |
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(215) 315-9000 |
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(Registrant’s telephone number, including area code) |
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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Yes x |
No o |
Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).
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Yes x |
No o |
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 24,717,171 shares of common stock, $.01 par value, were outstanding as of October 25, 2004.
NEOSE TECHNOLOGIES, INC.
(a development-stage company)
INDEX
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Page |
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PART I. |
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Item 1. |
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Balance Sheets as of December 31, 2003 and September 30, 2004 |
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4 |
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5 |
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6 |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
23 |
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Item 4. |
24 |
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PART II. |
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Item 6. |
25 |
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26 |
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2
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Item 1. |
Neose Technologies, Inc.
(a development-stage company)
Balance Sheets
(unaudited)
(in thousands, except per share amounts)
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December 31, |
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September 30, |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
48,101 |
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$ |
55,016 |
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Marketable securities |
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4,959 |
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— |
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Restricted funds |
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901 |
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— |
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Prepaid expenses and other current assets |
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917 |
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1,878 |
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Total current assets |
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54,878 |
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56,894 |
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Property and equipment, net |
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37,192 |
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42,158 |
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Intangible and other assets, net |
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2,775 |
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2,028 |
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Total assets |
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$ |
94,845 |
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$ |
101,080 |
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Current portion of long-term debt and capital lease obligations |
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$ |
2,231 |
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$ |
3,958 |
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Accounts payable |
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2,342 |
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1,791 |
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Accrued compensation |
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2,510 |
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1,940 |
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Accrued expenses |
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2,433 |
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2,533 |
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Deferred revenue |
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4,333 |
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4,720 |
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Total current liabilities |
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13,849 |
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14,942 |
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Long-term debt and capital lease obligations |
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8,370 |
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13,767 |
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Other liabilities |
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413 |
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542 |
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Total liabilities |
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22,632 |
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29,251 |
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Stockholders’ equity: |
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Preferred stock, par value $.01 per share, 5,000 shares authorized, none issued |
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— |
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— |
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Common stock, par value $.01 per share, 30,000 and 50,000 shares authorized; 19,935 and 24,717 shares issued and outstanding |
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199 |
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247 |
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Additional paid-in capital |
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217,849 |
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248,027 |
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Deferred compensation |
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(96 |
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(53 |
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Deficit accumulated during the development stage |
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(145,739 |
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(176,392 |
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Total stockholders’ equity |
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72,213 |
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71,829 |
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Total liabilities and stockholders’ equity |
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$ |
94,845 |
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$ |
101,080 |
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The accompanying notes are an integral part of these financial statements.
3
Neose Technologies, Inc.
(a development-stage company)
Statements of Operations
(unaudited)
(in thousands, except per share amounts)
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Three months ended |
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Nine months ended |
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Period from inception |
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2003 |
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2004 |
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2003 |
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2004 |
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Revenue from collaborative agreements |
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$ |
150 |
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$ |
1,451 |
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$ |
871 |
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$ |
3,592 |
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$ |
22,473 |
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Operating expenses: |
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Research and development |
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6,747 |
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9,305 |
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19,031 |
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24,971 |
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151,470 |
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Marketing, general and administrative |
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2,456 |
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2,861 |
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8,657 |
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9,047 |
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69,267 |
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Total operating expenses |
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9,203 |
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12,166 |
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27,688 |
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34,018 |
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220,737 |
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Operating loss |
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(9,053 |
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(10,715 |
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(26,817 |
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(30,426 |
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(198,264 |
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Other income |
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— |
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— |
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— |
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— |
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7,773 |
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Impairment of equity securities |
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(1,250 |
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— |
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(1,250 |
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— |
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(1,250 |
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Interest income |
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103 |
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195 |
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420 |
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431 |
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19,773 |
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Interest expense |
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(138 |
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(304 |
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(338 |
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(658 |
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(4,424 |
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Net loss |
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$ |
(10,338 |
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$ |
(10,824 |
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$ |
(27,985 |
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$ |
(30,653 |
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$ |
(176,392 |
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Basic and diluted net loss per share |
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$ |
(0.59 |
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$ |
(0.44 |
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$ |
(1.66 |
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$ |
(1.38 |
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Weighted-average shares outstanding used in computing basic and diluted net loss per share |
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17,437 |
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24,712 |
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16,828 |
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22,284 |
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The accompanying notes are an integral part of these financial statements.
4
Neose Technologies, Inc.
(a development-stage company)
Statements of Cash Flows
(unaudited)
(in thousands)
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Nine months ended |
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Period from inception |
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2003 |
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2004 |
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Cash flows from operating activities: |
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Net loss |
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$ |
(27,985 |
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$ |
(30,653 |
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$ |
(176,392 |
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Adjustments to reconcile net loss to cash used in operating activities: |
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Depreciation and amortization |
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3,511 |
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4,433 |
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22,360 |
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Non-cash compensation |
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129 |
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93 |
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5,010 |
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Loss on disposition of property and equipment |
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99 |
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5 |
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269 |
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Common stock issued for non-cash and other charges |
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— |
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— |
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35 |
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Changes in operating assets and liabilities: |
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Prepaid expenses and other current and non-current assets |
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(370 |
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(1,008 |
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(2,239 |
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Accounts payable |
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(109 |
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(551 |
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1,791 |
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Accrued compensation |
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222 |
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(570 |
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1,521 |
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Accrued expenses |
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(250 |
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575 |
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2,153 |
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Deferred revenue |
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(250 |
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387 |
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4,720 |
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Other liabilities |
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(220 |
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129 |
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123 |
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Net cash used in operating activities |
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(25,223 |
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(27,160 |
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(140,649 |
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Cash flows from investing activities: |
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Purchases of property and equipment |
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(2,137 |
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(8,942 |
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(59,505 |
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Proceeds from sale-leaseback of equipment |
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— |
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— |
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1,382 |
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Purchases of marketable securities |
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(38,568 |
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— |
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(423,307 |
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Proceeds from sales of marketable securities |
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8,327 |
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— |
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29,686 |
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Proceeds from maturities of and other changes in marketable securities |
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25,500 |
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5,000 |
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394,360 |
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Purchase of acquired technology |
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— |
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— |
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