2017 Q1 Form 10-Q Financial Statement

#000120037517000020 Filed on May 09, 2017

View on sec.gov

Income Statement

Concept 2017 Q1 2016 Q1
Revenue $7.971M $7.996M
YoY Change -0.31% 17.62%
Cost Of Revenue $3.002M $2.489M
YoY Change 20.61% 70.95%
Gross Profit $4.969M $5.507M
YoY Change -9.77% 3.09%
Gross Profit Margin 62.34% 68.87%
Selling, General & Admin $6.606M $6.802M
YoY Change -2.88% 21.94%
% of Gross Profit 132.94% 123.52%
Research & Development $5.839M $5.686M
YoY Change 2.69% 7.42%
% of Gross Profit 117.51% 103.25%
Depreciation & Amortization $326.0K $465.0K
YoY Change -29.89% -16.67%
% of Gross Profit 6.56% 8.44%
Operating Expenses $15.45M $14.98M
YoY Change 3.14% 21.5%
Operating Profit -$7.476M -$6.981M
YoY Change 7.09% 26.26%
Interest Expense $20.00K $20.00K
YoY Change 0.0%
% of Operating Profit
Other Income/Expense, Net $22.00K $3.000K
YoY Change 633.33% -88.0%
Pretax Income -$7.436M -$6.963M
YoY Change 6.79% 25.46%
Income Tax $24.00K $11.00K
% Of Pretax Income
Net Earnings -$7.460M -$6.974M
YoY Change 6.97% 25.39%
Net Earnings / Revenue -93.59% -87.22%
Basic Earnings Per Share
Diluted Earnings Per Share -$180.8K -$173.9K
COMMON SHARES
Basic Shares Outstanding 41.38M shares 40.47M shares
Diluted Shares Outstanding

Balance Sheet

Concept 2017 Q1 2016 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $13.90M $22.20M
YoY Change -37.39% 0.0%
Cash & Equivalents $13.92M $22.16M
Short-Term Investments
Other Short-Term Assets $1.300M $1.200M
YoY Change 8.33% -7.69%
Inventory $1.124M $1.021M
Prepaid Expenses
Receivables $5.381M $4.352M
Other Receivables $0.00 $0.00
Total Short-Term Assets $21.74M $28.78M
YoY Change -24.44% 4.14%
LONG-TERM ASSETS
Property, Plant & Equipment $2.752M $2.756M
YoY Change -0.15% -21.23%
Goodwill $3.241M $3.241M
YoY Change 0.0% 0.0%
Intangibles $1.968M
YoY Change -63.16%
Long-Term Investments $1.100M $1.500M
YoY Change -26.67% 114.29%
Other Assets $253.0K $202.0K
YoY Change 25.25% -28.87%
Total Long-Term Assets $8.889M $10.41M
YoY Change -14.64% -24.48%
TOTAL ASSETS
Total Short-Term Assets $21.74M $28.78M
Total Long-Term Assets $8.889M $10.41M
Total Assets $30.63M $39.19M
YoY Change -21.84% -5.39%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $3.493M $2.850M
YoY Change 22.56% 46.0%
Accrued Expenses $3.055M $3.224M
YoY Change -5.24% 56.13%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities $13.53M $16.48M
YoY Change -17.94% 38.87%
LONG-TERM LIABILITIES
Long-Term Debt $255.0K $0.00
YoY Change
Other Long-Term Liabilities $2.211M $2.458M
YoY Change -10.05% -40.83%
Total Long-Term Liabilities $2.466M $2.458M
YoY Change 0.33% -40.83%
TOTAL LIABILITIES
Total Short-Term Liabilities $13.53M $16.48M
Total Long-Term Liabilities $2.466M $2.458M
Total Liabilities $18.95M $18.94M
YoY Change 0.05% 18.21%
SHAREHOLDERS EQUITY
Retained Earnings -$299.5M -$290.5M
YoY Change 3.11% 3.19%
Common Stock $4.000K $4.000K
YoY Change 0.0% 0.0%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $11.68M $16.11M
YoY Change
Total Liabilities & Shareholders Equity $30.63M $39.19M
YoY Change -21.84% -5.39%

Cashflow Statement

Concept 2017 Q1 2016 Q1
OPERATING ACTIVITIES
Net Income -$7.460M -$6.974M
YoY Change 6.97% 25.39%
Depreciation, Depletion And Amortization $326.0K $465.0K
YoY Change -29.89% -16.67%
Cash From Operating Activities -$3.566M $219.0K
YoY Change -1728.31% -105.69%
INVESTING ACTIVITIES
Capital Expenditures $237.0K $265.0K
YoY Change -10.57% 409.62%
Acquisitions
YoY Change
Other Investing Activities $0.00 $30.00K
YoY Change -100.0% 200.0%
Cash From Investing Activities -$236.0K -$238.0K
YoY Change -0.84% 406.38%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -$1.547M -$1.091M
YoY Change 41.8% 151.96%
NET CHANGE
Cash From Operating Activities -$3.566M $219.0K
Cash From Investing Activities -$236.0K -$238.0K
Cash From Financing Activities -$1.547M -$1.091M
Net Change In Cash -$5.349M -$1.110M
YoY Change 381.89% -74.35%
FREE CASH FLOW
Cash From Operating Activities -$3.566M $219.0K
Capital Expenditures $237.0K $265.0K
Free Cash Flow -$3.803M -$46.00K
YoY Change 8167.39% -98.82%

Facts In Submission

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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Concentrations of Credit Risk</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Financial instruments that potentially subject us to significant concentrations of credit risk consist primarily of cash and cash equivalents, accounts receivable, marketable securities, and restricted cash. Cash that is not required for immediate operating needs is invested principally in money market funds. Cash and cash equivalents are invested through banks and other financial institutions in the United States, India and Netherlands. Such deposits in those countries may be in excess of insured limits.</font></div></div>
CY2017Q1 us-gaap Nature Of Operations
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:10px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Description of Business</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In these notes to the consolidated financial statements, the &#8220;Company,&#8221; &#8220;we,&#8221; &#8220;us,&#8217;&#8221; and &#8220;our&#8221; refers to Codexis, Inc. and its subsidiaries on a consolidated basis.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We discover, develop and sell proteins that deliver value to our clients in a growing set of industries. We view proteins as a vast untapped source of value-creating materials, and we are using our proven technologies, which have been continuously improved over our </font><font style="font-family:inherit;font-size:10pt;">fifteen</font><font style="font-family:inherit;font-size:10pt;"> year history, to commercialize an increasing number of novel proteins, both as proprietary Codexis products and in partnership with our customers.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Many companies have historically used naturally occurring proteins to produce or enhance goods used in everyday life. Despite the growing number of commercial applications of naturally occurring proteins across many industries, the inherent limitations of naturally-occurring proteins frequently restrict their commercial use. Through the application of our proprietary CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform, we are able to engineer novel proteins to overcome these restrictions, thereby adding value or opening up new prospects for our potential clients&#8217; products, processes or businesses. We have developed new proteins that are significantly more stable and/or active in our customers' commercial applications than proteins derived from nature.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We are a pioneer in the harnessing of computational technologies to drive biology advancements. Over the last fifteen years, we have made substantial investments in the development of our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform, the primary source of our competitive advantage. Our technology platform is powered by proprietary, artificial intelligence-based, computational algorithms that rapidly mine our large and continuously growing library of protein variants&#8217; performance attributes. These computational outputs enable increasingly reliable predictions for next generation protein variants to be engineered, enabling delivery of targeted performance enhancements in a time-efficient manner. In addition to its computational prowess, our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform integrates additional modular competencies, including robotic high-throughput screening and genomic sequencing, organic chemistry and process development, which are all coordinated to create our novel protein innovations.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We use our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform to engineer custom enzymes. Most of our custom enzymes are intended for use as biocatalysts or protein catalysts. In simple terms, our protein catalysts can accelerate and/or improve yields of chemical reactions. We use our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform to develop novel enzymes that enable industrial biocatalytic reactions and fermentations. Our technology platform has enabled commercially viable products and processes for the manufacture of pharmaceutical intermediates and active ingredients and fine chemicals.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Our approach to develop commercially viable biocatalytic manufacturing processes begins by conceptually designing the most cost-effective and practical process for a targeted product. We then develop optimized protein catalysts to enable that process design, using our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering platform technology. Engineered protein catalyst candidates, many thousands for each protein engineering project, are then rapidly screened and validated in high throughput under relevant manufacturing operating conditions. This approach results in an optimized protein catalyst enabling cost-efficient processes that typically are relatively simple to run in conventional manufacturing equipment. This also allows for the efficient technical transfer of our process to our manufacturing partners.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The successful embodiment of our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform in commercial manufacturing processes requires well-integrated expertise in a number of technical disciplines. In addition to those directly involved in practicing our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering platform technology, such as molecular biology, enzymology, microbiology, cellular engineering, metabolic engineering, bioinformatics, biochemistry and high throughput analytical chemistry, our process development projects also involve integrated expertise in organic chemistry, chemical process development, chemical engineering, fermentation process development and fermentation engineering. Our integrated, multi-disciplinary approach to biocatalyst and process development is a critical success factor for our company.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We initially commercialized our CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform and products in the pharmaceuticals market, which remains our primary business focus. Our customers, which include several large global pharmaceutical companies, use our technology, products and services in their manufacturing processes and process development.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have also used the technology to develop protein catalysts for use in the fine chemicals market. The fine chemicals market consists of several large market verticals, including food and food ingredients, animal feed, flavors, fragrances, and agricultural chemicals.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">More recently, we are also using the CodeEvolver</font><font style="font-family:inherit;font-size:10pt;"><sup style="vertical-align:top;line-height:120%;font-size:7pt">&#174;</sup></font><font style="font-family:inherit;font-size:10pt;"> protein engineering technology platform to develop early stage, novel biotherapeutic product candidates, both for our customers and for our own business, most notably our lead program for the potential treatment of phenylketonuria ("PKU") disease in humans. PKU is an inherited metabolic disorder in which the enzyme that converts the essential amino acid phenylalanine into tyrosine is deficient.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">We have also used our technology to develop an enzyme for customers using next generation sequencing (&#8220;NGS&#8221;) and polymerase chain reaction (&#8220;PCR/qPCR&#8221;) for </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">in vitro</font><font style="font-family:inherit;font-size:10pt;"> molecular diagnostic and genomic research applications.</font></div></div>
CY2017Q1 us-gaap Use Of Estimates
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Use of Estimates</font></div><div style="line-height:120%;padding-top:12px;text-indent:24px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent liabilities at the date of the condensed consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. We regularly assess these estimates which primarily affect revenue recognition, accounts receivable, inventories, the valuation of investment securities and marketable securities, goodwill arising out of business acquisitions, accrued liabilities, stock awards and the valuation allowances associated with deferred tax assets. Actual results could differ from those estimates and such differences may be material to the condensed consolidated financial statements.</font></div></div>

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