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Protein Polymer Technologies Reports Second Quarter and Six-Month 2005 Financial Results

Posted on: Monday, 22 August 2005, 18:00 CDT

SAN DIEGO, Aug. 22 /PRNewswire-FirstCall/ -- Protein Polymer Technologies, Inc. (BULLETIN BOARD: PPTI) , reported today its financial results for the second quarter and six-months ended June 30, 2005.

The net loss for the quarter ended June 30, 2005 applicable to common shareholders was $2,487,000 ($0.04 per share), compared to a net loss of $858,000 ($0.02 per share), for the same period in 2004. The net loss for the six-months ended June 30, 2005 was $3,559,000 ($0.07 per share), compared to a net loss of $1,778,000 ($0.05 per share), for the six-months ended June 30, 2004. The net loss and the net loss per share amounts for quarter ended June 30, 2005 include a $1,245,000 one time, non-cash charge to earnings associated with the issuance of warrants for services to William N. Plamondon III, the Company's recently appointed chief executive officer. In addition to the charge to earnings associated with the issuance of the warrants, the net loss and the net loss per share also included in each of the three-month and the six-month periods of 2005 and 2004 $69,000 and $619,000 and $69,000 and $138,000, respectively, for undeclared dividends related to the Company's preferred stock.

In April 2005, the Company raised approximately $7,775,000 from the sale of Common Stock and warrants. In connection with this transaction, the Company eliminated approximately $1.2 million in the form of short-term promissory notes and increased its working capital by approximately $6 million. Excluding the effect of the non-cash charge to earnings incurred in the issuance of warrants and the imputed dividends, the net loss for the six months ended June 30, 2005 applicable to common shareholders would have been $1,695,000 ($0.04 per share).

Total revenue was $145,000 for the quarter ended June 30, 2005, compared to $199,000 for the same period in 2004. Total revenue was $658,000 for the six-months ended June 30, 2005, compared to $388,000 for the same period in 2004. The contract and licensing revenue primarily represents research and development payments and receivables from Spine Wave, Inc. for the development of an injectable spinal disc repair product for the treatment of lower back pain and a $250,000 benchmark payment in March 2005 from Genencor International.

Operating expenses for the quarter, excluding the one time non-cash charge to earnings incurred in the issuance of warrants, were $1,334,000, as compared to $988,000 for the same period in 2004 and $2,283,000 for the six months ended June 30, 2005 as compared to $2,029,000 for the six months ended 2004. The increase in operating expenses for the quarter and the six month period are primarily due to increased personnel costs, additional public and investor relations expenses and certain costs associated with the financing effort.

As of June 30, 2005, PPTI had $4,392,000 in working capital compared to a negative working capital deficiency of $1,531,000 at December 31, 2004.

William N. Plamondon III, Chief Executive Officer of Protein Polymer Technologies, commented, "The completion of financing earlier this year allows us to continue to focus on the clinical trials of several of our products. Additionally we will continue to produce materials for Spine Wave's clinical trials of our injectable spinal disc repair product and to pursue strategic acquisitions that we have identified."

About Protein Polymer Technologies, Inc.

Protein Polymer Technologies, Inc. is a biotechnology company that discovers and develops innovative therapeutic devices to improve medical and surgical outcomes. The Company focuses on developing technology and products to be used for soft tissue augmentation, tissue adhesives and sealants, wound healing support and drug delivery devices. Protein Polymer Technologies proprietary protein-based biomaterials are uniquely tailored to optimize clinical performance and contain no human or animal components that could potentially transmit or cause disease. The company is headquartered in San Diego, California. For additional information about the company, please visit http://www.ppti.com/.

To date, PPTI has been issued twenty-six U.S. Patents on its core technology with corresponding issued and pending patents in key international markets.

This press release contains forward-looking statements that are based on management's views and expectations. Actual results could differ materially from those expressed here; further, the Company is not obligated to comment specifically on those differences. Risks associated with the Company's activities include raising adequate capital to continue operations scientific and product development uncertainties, competitive products and approaches, continuing collaborative partnership interest and funding, regulatory testing and approvals, and manufacturing scale up. The reader is encouraged to refer to the Company's 2004 Annual Report Form 10-KSB, and 10KSB/A and other recent filings with the Securities and Exchange Commission, copies of which are available from the Company, to further ascertain the risks associated with the above statements.

Protein Polymer Technologies, Inc. Condensed Financial Statements (unaudited) Three months ended Six months ended June 30, June 30, 2005 2004 2005 2004 Revenues: Contract revenue $145,225 $199,366 $657,996 $388,416 Product and other income 430 -- 1,101 6 Total revenues 145,655 199,366 659,097 388,422 Expenses: Research and development 692,408 587,806 1,248,376 1,226,553 Selling, general and administrative 1,886,704 400,094 2,279,997 802,849 Total expenses 2,579,112 987,900 3,528,373 2,029,402 Net loss from operations (2,433,457) (788,534) (2,869,276) (1,640,980) Other income (expense): Interest income 16,122 866 16,201 2,824 Interest expense (249) (899) (86,874) (1,798) Total other income (expense) 15,873 (33) (70,673) 1,026 Net loss (2,417,584) (788,567) (2,939,949) (1,639,954) Undeclared, imputed and/or paid dividends on preferred stock 69,220 69,220 619,261 137,678 Net loss applicable to common shareholders $(2,486,804) $(857,787) $(3,559,210) $(1,777,632) Basic and diluted net loss per common share $(0.04) $(0.02) $(0.07) $(0.05) Shares used in computing basic and diluted net loss per common share 59,687,009 38,091,587 50,044,186 37,702,398

Protein Polymer Technologies, Inc.

CONTACT: Erin Davis of Protein Polymer Technologies, Inc.,+1-858-558-6064, ext. 120; or Media, Carole Boucard, +1-954-370-2524, or BryandeCastro, +1-631-495-9177, both of Creative Public Relations, for ProteinPolymer Technologies, Inc.

Web site: http://www.ppti.com/

Source: PRNewswire-FirstCall

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