TerraVia™
May 5, 2014

Solazyme Reports First Quarter 2014 Results

SOUTH SAN FRANCISCO, Calif.--(BUSINESS WIRE)-- Solazyme, Inc. (NASDAQ:SZYM), a renewable oil and bioproducts company, announced today results for the first quarter ended March 31, 2014.

"Q1 was an important milestone quarter for the company from both production and commercialization standpoints as we began making and selling products from Clinton/Galva, our first large scale commercial facility; our partner Unilever began using our oils in its premier Lux soap brand; we launched and began selling our new EncapsoTM encapsulated lubricants in the oil field services market; and our Algenist® brand expanded into Nordstrom. While we haven't yet announced our first commercial product out of Moema, much of that plant is operational, including full-scale fermenters. We expect to manufacture commercial product at the Moema facility in the second quarter," said Jonathan Wolfson, CEO of Solazyme.

Financial Results

Total revenue for the first quarter of 2014 was $12.4 million compared with $6.7 million in the first quarter of 2013, an increase of 85%. First quarter GAAP net loss was $34.7 million, which compares with net loss of $26.5 million in the prior year period. On a non-GAAP basis, the net loss was $30.5 million for the first quarter of 2014, compared with net loss of $21.5 million in the prior year quarter. A reconciliation of GAAP to non-GAAP results is included below.

"Manufacturing at Clinton/Galva is progressing as planned and we are pleased to report that we have doubled the number of customers shipped to since our update at the end of February," said Tyler Painter, CFO of Solazyme. "We made commercial progress across our consumer products, nutrition, encapsulated lubricants, and industrial oils and fuels markets. We also strengthened our balance sheet and are well-positioned to ramp manufacturing volumes and commercialize our growing portfolio of products."

Recent Business Highlights

Conference Call

Solazyme will hold a conference call for investors on May 5, 2014 at 1:30 p.m. PT (4:30 p.m. ET). Investors may access the call by dialing 973-409-9250. A live webcast of the call will be available from the Investor Relations section of www.solazyme.com. A recording of the call will also be available by calling 404-537-3406; access code 30922209 beginning approximately two hours after the call, and will be available for one week. A webcast replay from today's call will also be available from the Investor Relations section of www.solazyme.com approximately two hours after the call and will be available for up to thirty days.

About Solazyme, Inc.

Solazyme, Inc. (SZYM) is a renewable oil and bioproducts company that transforms a range of low-cost plant-based sugars into high-value oils. Headquartered in South San Francisco, Solazyme's Renewable™ products can replace or enhance oils derived from the world's three existing sources - petroleum, plants and animal fats. Initially, Solazyme is focused on commercializing its products into target markets including fuels and chemicals, nutrition, oil field services, and skin and personal care.

Solazyme®, Algenist®, and the Solazyme logo are registered trademarks of Solazyme, Inc.

Non-GAAP Financial Measures

This press release includes the following financial measure defined as a "non-GAAP financial measure" by the Securities and Exchange Commission: non-GAAP net loss. This measure may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles. For a reconciliation of this non-GAAP financial measure to the nearest comparable GAAP measure, see "Reconciliation of GAAP to Non-GAAP Basic Net-Loss Per Share" included in the tables to this press release.

This non-GAAP measure is provided to enhance investors' overall understanding of Solazyme's current financial performance and Solazyme's prospects for the future. Specifically, Solazyme believes the non-GAAP measure provides useful information to both management and investors by excluding certain expenses that may not be indicative of its core operating results and business outlook.

For its internal budgeting process, Solazyme's management uses financial measures that do not include stock-based compensation expense or special expenses such as non-cash gains or losses due to warrant revaluations. In addition to the corresponding GAAP measures, Solazyme's management also uses the foregoing non-GAAP measure in reviewing the financial results of Solazyme. Solazyme excludes stock-based compensation expenses and special non-cash charges from its non-GAAP measures primarily because they are non-cash expenses that management does not believe are reflective of ongoing operating results.

Forward Looking Statements

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 about Solazyme, including statements that involve risks and uncertainties concerning: its commercialization and production plans and commercialization timetable for its products; the timing of commercial product production; the commissioning of equipment and the ramping up of facilities; the timetable for bringing facilities online; meeting commercialization and technology targets; and Solazyme's ability to maintain its relationships with its partners. When used in this press release, the words "will", "expects", "intends" and other similar expressions and any other statements that are not historical facts are intended to identify those assertions as forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such statement may be influenced by a variety of factors, many of which are beyond the control of Solazyme, that could cause actual outcomes and results to be materially different from those projected, described, expressed or implied in this press release due to a number of risks and uncertainties. Potential risks and uncertainties include, among others: Solazyme's limited operating history; its limited history in commercializing products; implementation risk in deploying new technologies; its limited experience in constructing, ramping up and operating commercial manufacturing facilities; its ability to sell its products at a profit; delays related to construction, start-up and ramp-up of production facilities; its ability to manage operational costs at production facilities; its ability to enter into and maintain strategic collaborations; its ability to obtain requisite regulatory approvals; and its access, on favorable terms, to any required financing. Accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what impact they will have on the results of operations or financial condition of Solazyme.

In addition, please refer to the documents that Solazyme, Inc. files with the Securities and Exchange Commission, including its Annual Report on Form 10-K, as updated from time to time, for a discussion of these and other risks. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this press release. Solazyme is not under any duty to update any of the information in this press release.

       
SOLAZYME, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
In thousands, except per share amounts
(UNAUDITED)
 
Three Months Ended

March 31,

2014 2013

Revenues

Research and development programs $ 5,043 $ 2,680
Product revenues   7,348     4,000  
Total revenues 12,391 6,680
 

Costs and operating expenses (1)

Cost of product revenue 3,390 1,454
Research and development 20,835 13,720
Sales, general and administrative   20,607     14,866  
Total costs and operating expenses 44,832 30,040
   
Loss from operations (32,441 ) (23,360 )
 

Other income (expense) (2)

Interest and other income (expense), net (1,112 ) (1,523 )
Loss from equity method investment (3,834 ) (959 )
Gain from change in fair value of warrant liability

688

54

Gain (loss) from change in fair value of derivative liability

 

2,018

 

  (737 )
Total other income (expense)

(2,240

) (3,165 )
   
Net loss $

(34,681

) $ (26,525 )
Net loss per share, basic and diluted $

(0.50

) $ (0.43 )
 
Weighted average number of common shares used in loss per share computation, basic and diluted 69,213 61,543
 
 
 
SOLAZYME, INC.
RECONCILIATION OF GAAP TO NON-GAAP BASIC NET LOSS PER SHARE
In thousands, except per share amounts
(UNAUDITED)
 
Three Months Ended

March 31,

2014 2013
Net loss $

(34,681

) $ (26,525 )
Gain from change in fair value of warrant liability (688 ) (54 )

(Gain) loss from change in fair value of derivative liability

(2,018

)

737
(1) Operating expenses include stock-based compensation expense as follows:
Research and development 1,820 1,089
Sales, general and administrative   4,789     2,916  
Total stock-based compensation expense 6,609 4,005
(2) Other income (expense) includes costs as follows:
Amortization of debt discount and issuance costs   250     335  
Net loss (non-GAAP) $

(30,528

) $ (21,502 )
 
Basic and diluted loss per share (GAAP) $

(0.50

) $ (0.43 )
 
Gain from change in fair value of warrant liability (0.01 ) -

(Gain) loss from change in fair value of derivative liability

(0.03

)

0.01
Stock-based compensation expense 0.10 0.07
Amortization of debt discount and issuance costs   -     -  
Net loss per share (non-GAAP) $ (0.44 ) $ (0.35 )
 
 
 
SOLAZYME, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
In thousands
(UNAUDITED)
 
March 31, December 31,
2014 2013

Assets

 

Current assets

Cash, cash equivalents and marketable securities $ 133,154 $ 167,521
Other current assets   26,602     24,296  
Total current assets 159,756 191,817
Property, plant and equipment - net

39,146

40,089
Other assets   31,618     26,799  
Total assets $

230,520

  $ 258,705  
 

Liabilities and stockholders' equity

 

Current liabilities

Current portion of long-term debt $ 55 $ 65
Other current liabilities   20,352     25,229  
Total current liabilities 20,407 25,294
Other liabilities 548 1,006
Long-term debt  

88,999

    93,457  
Total liabilities  

109,954

    119,757  
Total stockholders' equity  

120,566

    138,948  
Total liabilities and stockholders' equity $

230,520

  $ 258,705  

Solazyme, Inc.
Corporate Communications:
Genet Garamendi
press@solazyme.com
or
Brainerd Communicators, Inc.
Jeff Majtyka, 212-986-6667
majtyka@braincomm.com
or
Brad Edwards, 212-986-6667
edwards@braincomm.com

Source: Solazyme, Inc.

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