Stony Brook, NY (PRWEB) May 12, 2014
Applied DNA Sciences, Inc. (OTCQB: APDN), (Twitter: @APDN), a biotechnology firm that provides DNA-based authentication and security solutions and services, announced results of its second quarter and first six months of fiscal 2014.
Karol Kain Gray, Chief Financial Officer, stated: “The increases in revenues are an indicator that our sales are continuing to grow and demonstrate the company’s ability to close contracts in a shorter period of time.”
Financial Highlights for the Second Quarter:
•Revenues for the second quarter of fiscal 2014 were $637,146, an 85% increase from the same quarter of the prior fiscal year. These are the highest revenues reported for the second quarter of any fiscal year in the history of the company. This increase was a result of revenues from the recently announced agreement entered into with a provider of polyolefins, an increase in sales to suppliers of components selling to Defense Logistics Agency (DLA) and the company’s efforts in the textile industry.
•During the quarter ended March 31, 2014, the company entered into approximately $1 million of contracts and purchase orders, some of which are expected to be recognized in future quarters.
•As reported on the balance sheet at March 31, 2014, the company had $416K in deferred revenue, which will be recognized over the next 12 months. Last year for the same period, Applied DNA Sciences did not record any deferred revenue.
•Total operating expenses increased by $811,609 or 27% for the three months ended March 31, 2014. The increase is primarily attributable to higher salary expense due to an increase in headcount from 38 as of March 31, 2013 to 52 as of March 31, 2014. The number of employees has only increased slightly since the third quarter of fiscal 2013. The growth of the research and development expenses is attributable to the increased laboratory space with the company’s new corporate headquarters as well as an increase in research and development to support the expansion of the company’s business and markets. The increase also includes rent, legal and stock-based compensation.
•Net loss for the three months ended March 31, 2014 decreased to $2,750,436 from a net loss of $3,127,631 for the three months ended March 31, 2013.
Financial Highlights for the First Six Months:
•For the first six months of this fiscal year, the company generated approximately $1.2 million in revenue, an increase of 86% from the same period last fiscal year, the highest revenues reported for the first six months of any fiscal year in the company’s history. About $390,000 of these revenues came from an increase in sales to military suppliers.
•Operating expenses for the six months ended March 31, 2014 increased by $2.5 million or 45%. As described above, the increase is attributable to payroll, rent, legal and research and development expenses to meet the anticipated future demand for sales.
•Net loss for the six months ended March 31, 2014 decreased to $9,042,086 from a net loss of $11,832,388 for the six months ended March 31, 2013.
Dr. James A. Hayward, Chief Executive Officer, stated: “We have seen our business evolve toward a much greater scale of DNA marking that we expect will yield additional revenue as the accumulated demand for authentication begins to flow back to the company. With our agreement with a major global producer of polyolefins—industrial plastics—we have the opportunity to enter a market for a vital industrial material with estimated production of 140 billion kg per year. This follows our December 2013 agreement with Supima, the cotton association, where we have been marking raw cotton at a scale of 50,000,000 kg. Our agreement with H. Dawson Wool might also reach very high scale. We are applying SigNature® DNA on a greater scale than we have in the past, expanding the universe of DNA-marked products, which in turn should increase the demand for authentications. The individual size of our customers is also growing with multiple customers having revenues from $3 billion to $30 billion annually.”
Recent highlights include:
•Each military customer must renew its contract annually in order to receive a new unique DNA mark that is required for marking products only for that 12-month period. To date, the company has had 100% customer retention in this market vertical. More than one half-million parts have been marked, with 30 companies participating, 14 of them original equipment or component manufacturers, prime defense contractors or authorized distributors.
•In conjunction with Centralne Biuro Zabezpieczeń (CBZ) of Poland, the company introduced its SigNature DNA forensic anti-theft product into Poland.
•NASA’s Jet Propulsion Laboratory (JPL) has received training on DNA authentication as part of its effort to assess the latest ideas and technologies related to counterfeit risk mitigation. JPL also intends to include information about SigNature DNA marking, including the CPA Program, as part of its Counterfeit Awareness Training Program. The latter has the participation of all major NASA facilities and many of its largest suppliers.
•The U.S. House of Representatives Senate Armed Services Committee added language to the National Defense Authorization Act (NDAA) for Fiscal Year 2015 calling on the Department of Defense for an update on DNA marking of microelectronics, among other counterfeit detection efforts.
•The federal government officially implemented new federal regulations requiring anti-counterfeiting systems for electronics suppliers to the Department of Defense on May 6, 2014. The regulations enforce laws passed in 2012 and 2013.
About Applied DNA Sciences
APDN is a provider of botanical-DNA based security and authentication solutions and services that can help protect products, brands, entire supply chains, and intellectual property of companies, governments and consumers from theft, counterfeiting, fraud and diversion. SigNature® DNA describes the uncopyable marker that is at the heart of all of our security and authentication solutions. SigNature DNA is at the core of a family of products such as DNAnet®, our anti-theft product, SigNature® T, targeted toward textiles, and digitalDNA®, providing powerful track and trace. All provide a forensic chain of evidence and can be used to prosecute perpetrators.
The statements made by APDN may be forward-looking in nature. Forward-looking statements describe APDN’s future plans, projections, strategies and expectations, and are based on assumptions and involve a number of risks and uncertainties, many of which are beyond the control of APDN. Actual results could differ materially from those projected due to our short operating history, limited financial resources, limited market acceptance, market competition and various other factors detailed from time to time in APDN’s SEC reports and filings, including our Annual Report on Form 10-K filed on December 20, 2013 (amended on May 1, 2014) and our subsequent quarterly reports on Form 10-Q/A (for the quarterly period ended December 31, 2013) and Form 10-Q (for the quarterly period ended March 31, 2014). APDN undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date hereof to reflect the occurrence of unanticipated events.