BioAmber increases sales, discusses development of second plant

By Erin Voegele | May 15, 2017

BioAmber Inc. recently released first quarter financial results, reporting sales of bio-succinic acid increased 46 percent when compared to the same quarter of 2016, reaching $2.1 million. The company also reported that seven new clients began buying succinic acid during the first quarter and that its plant, located in Sarnia, Ontario, achieved a new throughput record, briefly surpassing 70 percent.

“Our first quarter of 2017 witnessed record throughput rates at the plant, combined with incremental decreases in our overall operating costs per unit sold,” said Fabrice Orecchioni, president, chief operations officer and interim-CEO of BioAmber. “In addition, our recent TSX Listing will provide greater liquidity and depth of distribution for our shareholders and potential new investors.”

Revenues for the first quarter were $2.1 million, up 46 percent when compared to the first quarter of last year. The increase is attributed to an increase in the quantity of bio-succinic acid sold from Sarnia operations.

The company reported a net income attributable to BioAmber shareholders of $106,000, or $0.003 per share for the quarter, compared to a net loss of $10.9 million, or 39 cents per share, for the same period of last year.

The adjusted net loss attributable to BioAmber shareholders was $10.5 million, or a loss of 31 cents per share, compared to an adjusted net loss attributable to BioAmber shareholders of $8.1 million, or 29 cents per share, during the same three months of last year.

During an investor call, Orecchioni said the company’s primary goal is to make the Sarnia plant cash flow positive as quickly as possible. Attaining this objective, he said, requires growing the sales of bio-succinic acid, lowering production costs and consolidating the plant’s fixed cost. We made progress on all three fronts during the first quarter, he added.

Orecchioni also elaborated on achievements related to the Sarnia plant’s throughput rates. He noted the company has been making steady progress in plant throughput, recently hitting a new record by running as high as 70 percent. Although sales do not yet warrant operating at these higher rates for prolonged periods, the achievement does increase BioAmber’s confidence that it can operate consistently close to this level of throughput, he said. In addition, Orecchioni said the company has not identified any definitive barriers preventing the plant form achieving 100 percent of the design throughput over the course of the next year.

Regarding operations, Orecchioni also indicated that the plant’s fermentation process continues to demonstrate that it is robust. We have not lost a single fermentation batch in 20 months of operation, Orecchioni said.

He also briefly discussed plans for a second BioAmber facility in North America. According to Orecchioni, the company’s immediate priority is to secure project-level debt from either a U.S. or Canadian government program. He said ongoing discussions with the U.S. Department of Energy loan program office remain positive, while work is also progressing with the Canadian government. The decision over where to locate the second plant is currently expected to be made during the third quarter.