Lignol announces loss in recent quarter
October 1, 2012, Vancouver, BC - You had to look pretty far into the CNW release, but late last week cellulosic ethanol start-up Lignol declared a loss of $1 million for its Q1 2013 fiscal year.
According to the release, the main reason for that loss was the sharp reduction in government R&D grant monies to the tune of $700,000 over the previous year, although staff reductions helped minimize losses.
Lignol Energy Corporation also announced some operating highlights for the period. These included:
- Completed successful enzyme optimization work with Novozymes
- Continued development and expansion of intellectual property portfolio
Joined the Oak Ridge Carbon Fiber Composites Consortium, a group of
industry leaders who are dedicated to the development and
commercialization of new carbon fiber and composite materials
Developed a number of strategic investor opportunities that led to
closing a $2.4 million private placement and the acquisition of an 11.2
percent interest in Australian Renewable Fuels
Lignol shares traded at $0.12 on Friday, or roughly 5 per cent of their peak value in 2007.
According to the CNW release, the company's wholly owned subsidiary, Lignol Innovations Ltd. ("LIL")
is presently one of only a handful of companies with an operational,
integrated pilot-scale biorefinery capable of producing a clean,
reactive cellulose for both cellulosic ethanol and a range of high
value cellulose applications such as dissolving pulp. LIL has completed
an engineering design package for a commercial-scale biorefinery that
would produce up to 80 million litres of cellulosic ethanol
(approximately 20 million U.S. Gallons) and 55,000 tonnes of High
Performance Lignin (HP-L™ lignin) derivatives annually.
During Q1 FY13, LIL continued to operate its pilot plant and research
facilities to accelerate a major body of work related to enzyme
optimization with Novozymes, and to produce a range of pre-hydrolysates
from a number of different feedstocks to enhance hemicellulosic sugars
recovery. These process optimization activities have the potential to
increase the amount of ethanol produced and improve plant economics.
This is a key part of the extended work plan which is supported by
Sustainable Development Technology Canada ("SDTC"). It was recently
announced on September 6, 2012, that this major body of work had been
successfully completed with Novozymes, showing performance improvements
of up to 35%, as compared to previously best achieved results.
On August 27, 2012 the company announced that it had completed a
non-brokered private placement of 30.75 million common shares of the company, at a price of $0.08 per common share, to raise gross proceeds
of $2.46 million (the "Private Placement"), and had acquired from
Wasabi Energy Limited (ASX/AIM: WAS) ("Wasabi"), 275 million ordinary
shares of Australian Renewable Fuels Limited (ASX: ARW) ("ARW"), for a
total purchase price of $4.27 million. The total purchase
consideration was comprised of $0.5 million in cash, 19 million LEC
common shares issued at $0.08 per share for $1.52 million and a
10-month secured convertible debenture for $2.25 million convertible
into Lignol common shares at $0.15 per share.
For the three months ended July 31, 2012 ("Q1 FY13"), and the three
months ended July 31, 2011 ("Q1 FY12") LEC reported a net loss of
($1.0) million, or ($0.02) per share (basic and fully diluted). Total
operating expenses and government funding amounts were both reduced by
$0.7 million in the current quarter.
Total expenses were $1.3 million for Q1 FY13 compared $2.0 million in Q1
FY12, as a result of a $0.7 million overall reduction in research and
development expenses. This cost reduction was largely due to a
reduction in headcount and headcount related costs.
At the same time, total government funding was reduced to $0.3 million
for Q1 FY13 compared to $1.0 million in Q1 FY12, as a result of the
completion of certain grant programs before the start of the current
year, and as a result of the reduction in eligible research and
More information on the Q3 results can be found at the company's website.