AquaBounty Technologies Announces Financial Results for the Quarter and Six Months Ended June 30, 2021

About this update from Aquabounty Technologies, Inc.

Successful First Harvests of GE Salmon Completed and Site Selected for First Large-Scale Farm MAYNARD, Mass. , Aug. 04, 2021 (GLOBE NEWSWIRE) -- AquaBounty Technologies, Inc. (Nasdaq: AQB) (“AquaBounty” or the “Company”), a land-based aquaculture company utilizing technology to enhance productivity and sustainability, has provided financial results for the second quarter and six months ended June 30, 2021 . Second Quarter 2021 Highlights Successfully completed the first commercial scale harvests of it genetically engineered (“GE”) Atlantic salmon from both its Indiana and Rollo Bay farm sites in June. Selected Pioneer, Ohio as the location for its next large-scale farm with a planned annual production capacity of 10,000 metric tons. Construction is slated to begin within the next six months and the Company anticipates commercial grow-out to commence in 2023. Announced the regulatory approval of the Company’s GE Atlantic salmon by Brazil’s National Biosafety Technical Commission (CTNBio). Elected Gail Sharps Myers—EVP, Chief Legal Officer, Chief People Officer and Corporate Secretary for Denny’s Corporation—to AquaBounty’s Board of Directors at the Annual Shareholders’ Meeting. Appointed Melissa Daley as the Company’s Chief People Officer . Management Commentary “The second quarter of 2021 was marked by two significant operational milestones for the Company, including the first commercial harvests and sales of our GE salmon from both our Indiana and Rollo Bay farm sites, and the selection of Pioneer, Ohio as the site location for our large-scale farm,” said Sylvia Wulf , Chief Executive Officer of AquaBounty . “Our next farm will have approximately eight times the planned capacity of our Indiana location. We will continue to provide updates as we gain more specificity on the timelines for permitting and construction, with the commencement of grow-out targeted in 2023. “In both Indiana and Rollo Bay , our first commercial harvests have been a resounding success, with orders in place for the entire output from our customers who are now introducing the salmon in their markets. We have experienced challenges with the availability of personnel and the age of the technology at our Indiana farm, however we are addressing these issues and incorporating insights gained into the design of our large-scale farm. We will continue to ramp up our harvest schedule over the remainder of this year to each farm’s full capacity to meet growing demand. With the food service industry quickly regaining momentum toward pre-pandemic activity and with restaurants reopening nationally, we remain very optimistic for the demand for our fish. “We also continue to move forward in our international expansion. After extensive field trials in Brazil , our regulatory application for the sale and consumption of our GE salmon was approved by CTNBio, moving us closer to new market opportunities in South America . We are also actively progressing on potential opportunities in Israel and China.” “Looking ahead, the next-evolution of land-based salmon farming for AquaBounty is upon us and we are ready to scale to meet the demand with our current and planned facilities. I look forward to sharing additional developments and progress in the months ahead with our shareholders and customers,” concluded Wulf. Financial Summary through June 30, 2021 Revenue for the first six months of 2021 was $302 thousand , compared to $10 thousand in the same period of the prior year. Harvests began during June and are ramping steadily. Operating expenses for the first six months of 2021 were $9.6 million , compared to $6.6 million in the same period of the prior year. The increase reflects the growth in biomass, headcount and production expenses at the farms, as well as increases in corporate and marketing expenses. Net loss for the first six months of 2021 was $9.4 million , compared to $6.6 million in the same period of the prior year. Cash, cash equivalents and marketable securities were $204 .0 million as of June 30, 2021 , compared with $95 .8 million as of December 31, 2020 . About AquaBounty AquaBounty Technologies, Inc. (NASDAQ: AQB) is a leader in aquaculture leveraging decades of technology expertise to deliver game changing solutions that solve global problems, while improving efficiency, sustainability and profitability. AquaBounty provides fresh Atlantic salmon to nearby markets by raising its fish in carefully monitored land-based fish farms through a safe, secure and sustainable process. The Company’s land-based Recirculating Aquaculture System (“RAS”) farms, located in Indiana , United States and Prince Edward Island, Canada , are close to key consumption markets and are designed to prevent disease and to include multiple levels of fish containment to protect wild fish populations. AquaBounty is raising nutritious salmon that is free of antibiotics and other contaminants and provides a solution resulting in a reduced carbon footprint and no risk of pollution to marine ecosystems as compared to traditional sea-cage farming. For more information on AquaBounty , please visit www.aquabounty.com or follow us on Facebook , Twitter , LinkedIn and Instagram . Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended. All statements other than statements of historical fact contained in this release are forward-looking statements, including, but not limited to, statements regarding the location and anticipated capacity of our planned farm in Ohio , the timing of the commencement of construction and the beginning of commercial production, the expected demand for our products, our harvesting schedule, purchase orders, commitments and prospective agreements with customers; international expansion and the anticipated growth in market size and geographies. Forward-looking statements may be identified with words such as “will,” “may,” “can,” “expect,” “plan,” “slate,” “anticipate,” “upcoming,” “believe,” “estimate,” or similar terminology, and the negative of these terms. Forward-looking statements are not promises or guarantees of future performance and are subject to a variety of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from those contemplated in these forward-looking statements. Forward-looking statements speak only as of the date hereof, and, except as required by law, we undertake no obligation to update or revise these forward-looking statements. For additional information regarding these and other risks faced by us, please refer to our public filings with the Securities and Exchange Commission (“SEC”), available on the Investors section of our website at www.aquabounty.com and on the SEC’s website at www.sec.gov . Company Contact: AquaBounty Technologies Dave Conley Corporate Communications(613) 294-3078 Investor Relations: Greg Falesnik or Luke Zimmerman MZ Group - MZ North America (949) 259-4987 [email protected] AquaBounty Technologies, Inc. Condensed Consolidated Balance Sheets (Unaudited) As of June 30 , December 31 , 2021 2020 Assets Current assets: Cash and cash equivalents $ 132,345,351 $ 95,751,160 Marketable securities 71,693,675 — Inventory 2,655,098 1,525,377 Prepaid expenses and other current assets 1,285,168 405,370 Total current assets 207,979,292 97,681,907 Property, plant and equipment, net 29,159,517 26,930,338 Right of use assets, net 313,318 341,997 Intangible assets, net 238,694 245,546 Restricted cash 500,000 500,000 Other assets 81,629 76,715 Total assets $ 238,272,450 $ 125,776,503 Liabilities and stockholders' equity Current liabilities: Accounts payable and accrued liabilities $ 1,980,365 $ 1,760,103 Other current liabilities 63,902 62,483 Current debt, net 501,553 259,939 Total current liabilities 2,545,820 2,082,525 Long-term lease obligations 257,826 290,327 Long-term debt, net 8,766,986 8,528,490 Total liabilities 11,570,632 10,901,342 Commitments and contingencies Stockholders' equity: Common stock, $0.001 par value, 80,000,000 shares authorized; 71,025,738 and 55,497,133 shares outstanding as of June 30, 2021 and December 31,2020 , respectively 71,026 55,497 Additional paid-in capital 384,674,939 263,629,116 Accumulated other comprehensive loss (112,325 ) (267,258 ) Accumulated deficit (157,931,822 ) (148,542,194 ) Total stockholders' equity 226,701,818 114,875,161 Total liabilities and stockholders' equity $ 238,272,450 $ 125,776,503 AquaBounty Technologies, Inc. Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) Three Months Ended June 30 , Six Months Ended June 30 , 2021 2020 2021 2020 Revenues Product revenues $ 227,393 $ 2,950 $ 301,765 $ 9,703 Costs and expenses Product costs 1,847,596 1,041,316 3,402,251 1,882,750 Sales and marketing 548,881 137,434 867,516 188,222 Research and development 431,373 635,655 931,993 1,204,417 General and administrative 2,578,958 1,693,544 4,364,468 3,330,734 Total costs and expenses 5,406,808 3,507,949 9,566,228 6,606,123 Operating loss (5,179,415 ) (3,504,999 ) (9,264,463 ) (6,596,420 ) Other income (expense) Interest expense (80,210 ) (18,147 ) (159,014 ) (35,192 ) Other income (expense), net 28,888 (538 ) 33,849 (1,690 ) Total other income (expense) (51,322 ) (18,685 ) (125,165 ) (36,882 ) Net loss $ (5,230,737 ) $ (3,523,684 ) $ (9,389,628 ) $ (6,633,302 ) Other comprehensive income (loss): Foreign currency 65,924 165,501 145,963 (216,484 ) Unrealized gains 8,970 — 8,970 — Total other comprehensive income (loss) 74,894 165,501 154,933 (216,484 ) Comprehensive loss $ (5,155,843 ) $ (3,358,183 ) $ (9,234,695 ) $ (6,849,786 ) Basic and diluted net loss per share $ (0.07 ) $ (0.11 ) $ (0.14 ) $ (0.22 ) Weighted average number of common shares - basic and diluted 71,021,141 32,097,992 67,803,904 29,607,373 AquaBounty Technologies, Inc. Condensed Consolidated Statements of Cash Flows (Unaudited) Six Months Ended June 30 , 2021 2020 Operating activities Net loss $ (9,389,628 ) $ (6,633,302 ) Adjustment to reconcile net loss to net cash used in operating activities: Depreciation and amortization 857,842 701,593 Share-based compensation 217,069 309,244 Other non-cash charge 8,565 40,600 Changes in operating assets and liabilities: Inventory (1,122,422 ) (1,261,930 ) Prepaid expenses and other assets (876,139 ) (409,635 ) Accounts payable and accrued liabilities (153,120 ) 280,142 Net cash used in operating activities (10,457,833 ) (6,973,288 ) Investing activities Purchase of property, plant and equipment (2,437,911 ) (1,588,497 ) Proceeds from sale of asset held for sale — 98,000 Purchases of marketable securities (71,702,645 ) — Proceeds from legal settlement, net — 1,014,008 Other investing activities (11,010 ) (12,460 ) Net cash used in investing activities (74,151,566 ) (488,949 ) Financing activities Proceeds from issuance of debt 406,378 221,130 Repayment of term debt (79,600 ) (41,262 ) Proceeds from the issuance of common stock, net 119,120,437 14,521,704 Proceeds from the exercise of stock options and warrants 1,723,846 — Net cash provided by financing activities 121,171,061 14,701,572 Effect of exchange rate changes on cash, cash equivalents and restricted cash 32,529 (16,685 ) Net change in cash, cash equivalents and restricted cash 36,594,191 7,222,650 Cash, cash equivalents and restricted cash at beginning of period 96,251,160 2,798,744 Cash, cash equivalents and restricted cash at end of period $ 132,845,351 $ 10,021,394 Reconciliation of cash, cash equivalents and restricted cash reported in the consolidated balance sheet: Cash and cash equivalents $ 132,345,351 $ 10,021,394 Restricted cash 500,000 — Total cash, cash equivalents and restricted cash $ 132,845,351 $ 10,021,394 Supplemental disclosure of cash flow information and non-cash transactions: Interest paid in cash $ 149,533 $ 17,058 Property and equipment included in accounts payable and accrued liabilities $ 388,495 $ 238,235 Source: AquaBounty Technologies, Inc.

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