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PBIO: Significant Revenue Growth Expected for 2017 and Beyond

By Grant Zeng, CFA


Update on First Quarter 2017 Financials 

PBIO (OTC:PBIO) recently reported its financial results for the first quarter ended March 31, 2017. 

Total revenue for the first quarter 2017 was $0.55 million, as compared to total revenue of $0.51 million for the first quarter 2016, an increase of 8.0%. Total revenue consisted of products and services revenue and grant revenue. 

Products and services revenue increased 16% to $0.53 million for Q12017 as compared to $0.45 million for Q12016. This increase was primarily attributable to an increase of 19% in the sale of instrument systems, from $332,016 in Q1 2016 to $396,095 in the same quarter of 2017. Sales of consumables also increased during these same periods, from $44,234 in Q1 2016 to $63,264 in Q1 2017, an increase of 43%. 

Grant revenue for the first quarter of 2017 was $25,359, as compared to $56,128 in Q1 2016. Management believes grant revenue will increase over the remaining quarters in 2017.

Operating loss for the first quarter of 2017 was $1.0 million, as compared to operating loss of 1.0 million for Q12016, a reduction of $46,842 or 4%. This decrease was primarily due to reduced R&D expenses combined with increased sales of product and services.

Adjusted loss per common share - basic and diluted - was $0.03 for Q1 2017 compared to a loss per common share of $0.05 for the same period in 2016. 

As of March 31, 2017, PBIO held $121,438 in cash and cash equivalents. 

We Expect Significant Revenue Growth in 2017 and Beyond

In Feb 2017, PBIO announced that the Company has achieved CE Marking for the Barocycler 2320EXTREME, the Company's recently released, next-generation PCT-based sample preparation instrument. PBIO is now permitted to begin sales of the Barocycler 2320EXT in the European Economic Area. 

When the CE Mark is affixed to a product, it signifies the manufacturer's declaration that the product meets all applicable EU safety, health, or environmental requirements. Achieving CE Marking requires substantial cost, time, and effort from the manufacturer, but allows the product to be marketed and move freely throughout all 31 countries in the EEA that require the CE Mark.

The Barocycler 2320EXT is the most recent addition to, and the next generation of, PBIO's Barocycler family. It is a compact, bench top instrument offering many features and benefits not found in PBIO's earlier Barocycler models, such as data logging options, user-level security, computer-operated control with touch screen programming, and the ability to customize multiple pressure cycling parameters. These and other features have already positioned the Barocycler 2320EXT as an instrument of choice for life science key opinion leaders worldwide, when preparing protein samples for analysis. 

Achievement of CE Marking for the Barocycler 2320EXT is an important next step in the company’s commercialization plans for this powerful and enabling sample preparation instrument, especially since CE Marking is required prior to selling the Barocycler 2320EXT to the large and potentially lucrative biopharmaceutical market in Europe. The company recently signed agreements with several strong distribution partners in Europe, the SCIEX co-marketing agreement is entering its second year (SCIEX is a global provider of laboratory instrumentation to the life sciences area, with a large presence in Europe).

In March 2017, PBIO significantly bolstered its marketing and sales capabilities by contracting with well-known and highly regarded EKG Sales Associates, and by hiring two of its planned four additional field sales directors. 

Ms. Rajni Kareer will serve as the Company's Sales Director covering all of the west coast of the U.S. The other Sales Director Mr. Nicholas Cobb will cover upstate New York, northern New England, and all of eastern Canada. He will also have responsibility for field service throughout the U.S. and Canada. Both hires have a strong background in selling capital equipment to research laboratories, including spectrometers and HPLC equipment, as well as laboratory consumables.

With the significantly expanded sales and marketing capabilities, as well as the newly established multi-national co-marketing partner SCIEX, we continue to believe revenue will grow significantly in 2017 and beyond. Specifically, we believe products and services total revenue for 2017 will surpass the $3.50 million mark. 

These increases will be driven by sales from both existing and new products (instruments and consumables), from the Company’s expanding distribution network, and from the additional sales and marketing personnel the company is committed to hire. 


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