BOTHELL, Wash.—Helix BioMedix Inc., a developer of bioactive peptides, announced financial results for the company’s second quarter 2010 (2Q10) ended June 30, 2010. Revenue for 2Q10 approximately $330,000, compared to approximately $70,000 in 1Q10 and approximately $138,000 in the second quarter of the prior year. The increase in revenue is due to the continued growth in license fees from key customers and partners as well as further growth in peptide and consumer product sales.
Gross margin for 2Q10 was 62.2 percent, compared to 64.9 percent in 1Q10 and 32.8 percent in the second quarter a year ago. The year-over-year improvement in gross margin reflects the greater percentage of total revenue from license fees, which generate higher margin compared to peptide and consumer product sales.
“I am pleased to report the achievement of our record quarterly revenue as a result of strong growth across our licensing and peptide sales and continued strength in sales of Helix BioMedix-branded products," stated R. Stephen Beatty, president and chief executive officer of Helix BioMedix. “Growth in revenue from our licensed peptides reflects increased product marketing and improved consumer purchasing in the broader economy. In addition, we benefitted from ongoing efforts to advance sales of Helix BioMedix-branded Striking® products in the U.S. as well as in certain Asian markets through our recently announced Cerakine™ distribution agreement with RubyDerm Bio Inc. This reflects continued progress in our international strategy with South Korea, China and Japan being key markets for future growth. We also continued to make progress on our Rx candidate molecules during the quarter, positioning these technologies for further clinical studies. As a result of our progress, Helix BioMedix is well positioned for continued success across all of our primary businesses, including licensing, branded sales and Rx products."
Net loss for 2Q10was approximately $942,000, or $0.04 per share, compared to a net loss of approximately $927,000, or $0.04 per share, for 1Q10 and approximately $1.0 million, or $0.04 per share, for 2Q09. The sequential increase in net loss in 2Q10 was primarily due to higher operating expenses related to product testing and marketing activities, as well as interest expense related to our outstanding notes payable, partially offset by a higher gross profit.
As of June 30, 2010, the Company’s cash and cash equivalents balance was approximately $3.0 million as compared to approximately $3.6 million at March 31, 2010.
“In conclusion, we are very pleased with our progress through the first half of the year and expect to achieve record annual revenue in 2010," said Beatty. “Although we anticipate that third quarter revenue will be lower than the second quarter due to the bi-annual royalty payment schedule of a key customer, we expect our fourth quarter will once again reflect the continued growth of our business. We look forward to reporting our future achievements as we reach additional financial and product milestones in the coming quarters and year."