Amyris Update on Financials & Conference Cancellation

Amyris, Inc. has announced its management will be holding virtual 1X1 investor meetings as a result of the cancellation of the 32nd Annual Roth Conference, due to the COVID-19 pandemic.

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Management has updated its investor presentation, available to investors as filed on a Form 8-K.

The updated investor presentation includes a current debt schedule, warrant information, share count and quarterly renewable product gross margin breakdown to provide more clarity following the company's Q4 2019 earnings teleconference. It also includes a detailed breakdown of the company’s business activity and outlook.

During Q1 of this year, the company retired about $70 million of debt and added over $57 million of additional cash proceeds to its balance sheet. Most of this was accomplished through the exercise of warrants by Amyris’s long-term shareholders.

Now, the company has $196 million in debt (net of debt discount) with 67% of total debt in the hands of long-term shareholders or board members with a significant equity ownership in Amyris.

Amyris has 56.8 million warrants outstanding with 35.6 million of these owned by long-term shareholders that are also Amyris board members. When considering the pricing of these warrants, the company believes a portion of these can provide access to an additional $100 million of proceeds in the short term.

With four shareholders–Foris Ventures, DSM, Fidelity and Vivo Capital–owning more than 74% of its equity, the company has a highly concentrated ownership.

The company's current expectation based on the pricing and expiration of certain warrant and stock options would result in about 220 million fully diluted shares outstanding. The current outstanding share count is 163.8 million.

Regarding the update, John Melo, Amyris president and CEO, said:

We are on track for the fourth consecutive quarter of product gross margin expansion coupled with exceeding our overall recurring revenue objective for our products. Our product gross margin for existing products was 36% in the fourth quarter of 2019, which was an improvement from 3% in the first quarter of 2019. We are on track for about 48% product gross margin in the first quarter of 2020. Our overall Amyris corporate gross margin for the first quarter is on track to exceed 60%. Our consumer brands are delivering very strong sales performance in the first quarter with expected gross margin around 67%. Our branded direct to consumer business is delivering our strongest growth to date at over 310% at over 80% gross margin. Based on current performance, our 2020 consumer business in on track for about $100 million in retail sales and around $60 million of GAAP revenue. The consumer business for our brands is about 1/3 of our product revenue and does not include any ingredient sales to other brands.

We believe the combination of execution on our business plan at current performance levels, the continued conversion of warrants, and with the support from our long-term shareholders that we will have the funding to maintain adequate liquidity. At current performance levels, we expect to generate positive adjusted EBITDA, starting in the third quarter of this year. With this proxy for operating cash flow, we will be setting the foundation for continued strong positive operating cash generation for the future. We are continuing to monitor the impacts of COVID-19 across our operations and currently have inventory available to serve critical demand through the end of the second quarter, assuming no significant supply chain disruption occurs. We are very thankful to all of our teams who are working hard to stay safe and healthy.