After filing delay, stevia supplier reports losses

by Jeff Gelski
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VANCOUVER, B.C. — GLG Life Tech Corp., a global supplier of stevia extracts, on Aug. 14 reported losses for the fourth quarter and fiscal year ended Dec. 31, 2011, the first quarter ended March 31, 2012, and the second quarter ended June 30, 2012. GLG Life Tech presented the financial results more than four months after the company on March 30 said the reporting of its fiscal-year results would be delayed because it needed to obtain further audit evidence, primarily from third parties.

The delay led the British Columbia Securities Commission to impose a full cease trade order on Vancouver-based GLG Life Tech Corp. on May 3. The company itself announced on May 31 its intention to delist its shares from the Nasdaq Global Select Market as soon as practicable. The company at the time said it intended to voluntarily end its public reporting obligations under the U.S. Securities Exchange Act as soon as possible.

On Aug. 14, 2012, the company reported a loss of C$90,514,000 ($91,504,000) for the year ended Dec. 31, 2011, which compared with a loss of C$3,131,000 for the year ended Dec. 31, 2010. Fiscal year revenue of C$24,840,000 ($25,111,000) compared with C$58,927,000 in the previous fiscal year. A fourth-quarter loss of C$47,621,000 compared with a loss of C$3,234,000 in the previous year’s fourth quarter. Revenue in the fourth quarter fell to C$473,000 from C$19,300,000.

In the first quarter ended March 31, GLG Life Tech suffered a net loss of C$6,238,000, which compared with a loss of C$5,752,000 in the previous year’s first quarter, and had revenue of C$892,000 which compared with C$7,414,000 in the previous year’s first quarter.

In the second quarter ended June 30, GLG Life Tech had a net loss of C$8,293,000, which compared with a loss of C$12,514,000 in the previous year’s second quarter, and had revenue of C$6,761,000, which compared with C$15,213,000 in the previous year’s second quarter.

Over the first six months of the current fiscal year, only two of GLG Life Tech’s manufacturing facilities were operating, which led to capacity charges of about C$3 million.

Despite the recent losses, GLG Life Tech reported total assets of C$220,289,000 and total liabilities of C$104,964,000 on June 30. GLG Life Tech is a global supplier of stevia extracts, a natural, zero-calorie sweetener.

Looking forward, the company said it expects gross margins to improve as the Huinong (H3) proprietary stevia leaf variety comes into use in late 2012. The variety is expected to reduce processing costs starting in the fourth quarter of 2012.

GLG Life Tech added the use of stevia extracts should increase because of consumer concern about the role of sugar in causing obesity and diabetes as well as the demand for natural ingredients.

“Food and beverage companies are formulating and launching new products in response to consumer demand, and we believe stevia provides a solution that fits within consumer expectations for taste and health benefits,” the company said.

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