And as LEC gets closer to running out of money.......Hate to say this, but LEC is either going to have to make a deal soon, raise money at very dilutive prices, or face the reality of fading off into the sunset and who knows who will take over the assets then.
This truly sucks, IMO. atb
Mr. David Turner reports
LIGNOL REPORTS FISCAL 2012 FIRST QUARTER FINANCIAL RESULTS
Lignol Energy Corp. has released its financial results for the three-month period ended July 31, 2011.
Q1 FY12 Highlights:
- Lignol and HA International LLC announced successful customer production trials of a new foundry resin containing Lignol's HP-LA lignin; First Canadian patent application approved;
- Novozymes, Inc. joined Lignol's consortium for its Sustainable Development Technology Canada ("SDTC") funded project;
- Signed Joint Development and Commercialization Agreement with FPInnovations to develop new, high-value applications for Lignol's cellulose;
- Reached an agreement with the U.S. Department of Energy's Biomass Program to phase out work on the funding award for a demonstration project;
- Lignol's updated financial outlook projects the Company has sufficient resources to fund its "Baseline Operations" until March 2012.
On September 9, 2011, Lignol announced that it had engaged CIBC World Markets Inc. ("CIBC") and Capital West Partners ("Capital West") with respect to arranging strategic partner investments on a best-efforts basis to provide the Company with the required medium-term financing to begin development of its initial commercial projects. The Company continues to work with CIBC and Capital West to explore various strategic investor opportunities.
Lignol is presently one of only a handful of companies with an operational, integrated pilot-scale biorefinery producing both cellulosic ethanol and renewable chemicals from non-food feedstocks. The Company 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-LA lignin) derivatives annually.
During Q1 FY12, Lignol increased its investment in resources related to the expansion of relationships with major industrial and research partners, particularly those related to HP-LA lignin application development. These efforts resulted in the Company selling tonnage quantities of lignin to partners for industrial scale trials. Additionally, the Company reported on October 5, 2011 that tests conducted at a prominent North American research facility showed promising results that HP-LA lignin may be used to produce thermoplastics.
Financial Results
For the three month period ended July 31, 2011 ("Q1 FY12"), the Company reported a net loss of $1.0 million, or
.02 per share (basic and fully diluted) compared to a net loss of
.9 million or
.02 per share (basic and fully diluted) for the three month period ended July 31, 2010 ("Q1 FY11"). Total operating expenses incurred in Q1 FY12 declined by
.4 million compared with Q1 FY11, reflecting a
.2 million reduction in headcount related expenses, a
.1 million reduction in third-party contract research, and a
.1 million reduction in pilot plant related operating costs.
General and administrative expenses remained unchanged at
.4 million for Q1 FY12.
Total Q1 FY12 funding from government and corporate contributions was $1.0 million, compared to $1.5 million in Q1 FY11. A reduction of
.2 million is related to Lignol incurring lower levels of eligible research expenses in the current period, and the remaining
.3 million reduction relates to the fact that funding received in the prior period related to contribution agreements that were fully paid and had been completed before the start of the current fiscal year.
At July 31, 2011, the Company had gross resources available of up to $6.5 million, which were comprised of $2.9 million in cash and short-term investments, and up to $3.6 million in funding receivable in the future from contracted government and corporate funding agreements. After deducting $1.5 million in current liabilities, the Company had net resources available of up to $5.0 million at July 31, 2011.
The Company presently believes that the above combination of funding sources should be sufficient to continue funding its "Baseline Operations" until March 2012 (as defined in the MD&A for Q1 FY12). In the Company's previous MD&A for the year ended April 30, 2011 it had expected that such funds would be sufficient to fund its "Baseline Operations" until January 2012.
In January 2008, the Company was selected to receive an award of up to US$30 million from the U.S. Department of Energy ("DOE") under the DOE's "Demonstration of Integrated Biorefinery Operations for Producing Biofuels and Chemical/Materials Products" Funding Opportunity Announcement ("FOA"), to build a demonstration-scale cellulosic ethanol plant in the United States.
After plans for the proposed project in Colorado were halted in 2009 due to the recession and market volatility, the Company modified the scale and configuration of the proposed demonstration-scale project with the goal of developing a profitable, commercial-scale project, which incorporated innovations and design improvements generated from the operation of the Company's pilot-scale biorefinery. The resulting new project concept and plant design departed substantially from those that the award was originally based on.
The Company announced on July 15, 2011, that in consultations with the DOE, it was agreed that the Company's current plans could not be supported within the FOA. The Company would continue with certain engineering, technical and project development work, which the DOE had contracted to fund. The DOE had contracted with Lignol up to US$4.0 million in funding, of which US$3.0 million had been received as of July 31, 2011. Receipt of any remaining eligible amounts from the contracted award is subject to the Company meeting certain reporting milestones that are expected to be completed in the coming months.
Lignol's complete financial statements for the three month period ended July 31, 2011 and the related Management's Discussion & Analysis of Financial Condition and Results of Operations are available at the Company's website, www.lignol.ca, or at www.sedar.com under the Company's profile. These financial statements were prepared in accordance with the required adoption of international Financial Reporting Standards.
We seek Safe Harbor.