Davis, California, USA
March 15, 2019

• Fourth Quarter 2018 Revenues Grew 72% to $5.7 Million; Fiscal Year 2018 Revenues Increased 17% to $21.2 Million
• Fourth Quarter 2018 Gross Margins Expanded to 50.5%; Annual Gross Margins Expanded to 48.6%

Marrone Bio Innovations Inc. (NASDAQ: MBII) (MBI), an international leader in smart biopesticide and plant health solutions, has provided its financial results for the fourth quarter and full year ended December 31, 2018.

Selected Operating and Financial Highlights

*Because revenues in Full Year and Fourth Quarter 2018 included the effect of the adoption of the ASC 606 accounting standard (Revenue From Contracts With Customers), year-over-year numbers are not strictly an apples-to-apples comparison.

** Includes adjustments related to revisions to accounting assessment of Financing Transaction closed in Q1.

Q4 2018 Financial Highlights

• Revenues in the fourth quarter of 2018 improved by 72 percent to $5.7 million, compared with $3.3 million in the fourth quarter of 2017, primarily because of higher sales of the Venerate product family.
• The beneficial mix effect of increased sales of the Venerate product family in the fourth quarter of 2018 also increased gross margins significantly to a record 50.5 percent, compared with 46 percent in the fourth quarter of 2017.
• Operating expenses were $8.3 million in the fourth quarter of 2018, compared with $6.6 million in the fourth quarter of 2017, and reflected the investment in the sales and marketing organization.
• Net loss in the fourth quarter of 2018 was $8.0 million, or $(0.07) per share, compared with a net loss of $7.4 million, or $(0.24) per share, in the fourth quarter of 2017.
• Cash used in operations for the quarter was $2.8 million, down from $6.6 million in the fourth quarter of 2017.

FY 2018 Financial Highlights

• Revenues grew to $21.2 million in 2018, a 17 percent increase compared with $18.2 million in 2017, as sales of the current portfolio of products expanded both with current customers and across new crops and geographies.
• Gross margins expanded to 48.6 percent in 2018, compared with 42 percent in 2017, reflecting a favorable mix effect from higher sales of the Venerate product family.
• Full-year operating expenses were $29.8 million in 2018, compared with $30.6 million of operating expenses in 2017.
• Net loss improved by $10.7 million to a loss of $20.2 million, or $(0.20) per share, reflecting revenue growth and higher gross margins.
• Net loss for fiscal year 2018 was affected by several revisions to other income (expense), as related to the benefit of lower interest expense as well as the one-time effect of changes in the fair value of financial instruments and the gain and loss on extinguishment of debt. In particular, the revision related to the accounting assessments for the Company’s February 2018 financing transactions. The net effect of the change is a decrease in other income and expense of $2.3 million, and an increase in net loss by the same amount. This non-cash change does not affect operating results.
• Cash used in operations was $19.6 million in 2018, down from $21.1 million in 2017.

Management Commentary

“We not only stabilized our commercial operations and financial footprint in fiscal year 2018, but we did so as we grew revenues and expanded gross margins,” said Dr. Pam Marrone, chief executive officer of Marrone Bio Innovations.   “As we move forward in 2019, we are focused on three key deliverables:  One, portfolio optimization; two, market expansion; and three, accelerated innovation.  We see 2019 as a pivotal year as the groundwork we’ve put in place—technically, commercially and financially—comes to fruition with continued substantial revenue growth, which also sets the stage for growth in 2020 and beyond.”

“Marrone Bio’s technical successes are complemented by a disciplined approach to capitalizing our product pipeline, launching our commercial products and improving our manufacturing efficiencies, all while investing our cash strategically and judiciously,” she added.  “Coupled with last year’s financing transactions, we are well positioned as the commercial leader in biologically based agricultural solutions.”

Q4 2018 Operational Highlights

• Launched TerraConnect, a new global biological soil-applied and seed-treatment platform, delivering growers high-performance products as well as a broad range of valuable tools to improve and protect crops.
• Expanded MBI’s international distribution network through a new agreement with Hop Tri Investment Corporation in Vietnam and Cambodia, with AMC/Agrimatco in Turkey for Grandevo, Majestene and/or Regalia and with Kyung Nong Corporation for Majestene and Venerate in South Korea.
• Received notice of allowance from the U.S. Patent and Trademark Office for claims covering MBI-110 bacterium, the active ingredient in Stargus and Amplitude biofungicides, together covering nearly all potential commercial embodiments.

MBI-110 Biofungicide (Stargus) and Haven Sun Protectant approved for sale in Canada for use in fruits and vegetables (Stargus) and fruits, vegetables and nuts (Haven). 

Website: http://marronebioinnovations.com/

Published: March 15, 2019