 Revenues increased 21 to 15 million; 72 rise in RD revenue included a significant contribution from the Takeda biotherapeutics partnership Conference call with slides begins at 4:30 p.m. Eastern time today REDWOOD CITY, Calif., Aug. 06, 2020 GLOBE NEWSWIRE -- Codexis, Inc. Nasdaq: CDXS, a leading protein engineering company, announces financial results for the three and six months ended June 30, 2020 and provides a business update. Management will hold a conference call today beginning at 4:30 p.m. Eastern time, with accompanying updated Pipeline Snapshot slides available here.We delivered better-than-expected revenues for the quarter of 15.0 million, up 21 over the prior year, led by strength in RD revenues which grew 72, said Codexis President and CEO John Nicols. Throughout the pandemic we have continued to forge key partnerships that build toward a strong future. Our partnership with Takeda, which we announced in late March as the pandemic surged, contributed significant revenues in the second quarter. We also executed new deals with Alphazyme and Molecular Assemblies that highlighted four new Performance Enzymes that we are working to commercialize into high growth life science applications, targeting improvements to the manufacture and diagnosis of both DNA and RNA.Our new partnerships build upon a strong foundation backed by our highly capable team and substantial financial resources. Our updated Pipeline Snapshot now showcases 65 pre-commercial and commercial programs, a growth of 25 versus the last year, including 13 self-funded programs. The number of commercial stage programs, which generate recurring revenues for us, delivered the largest annual jump since we started providing the pipeline snapshots four years ago. We look to work with our customers and partners to continue this growing commercialization trend especially given the continued progress in over 50 advanced stage pre-commercial programs, both internal and external, being managed by the Codexis team in parallel, Mr. Nicols said.In response to COVID-19, following nearly two months of lab shutdown, we gradually ramped up our RD operations beginning in early May, by staggering work schedules and adapting our facility to provide a safe environment for all on-site employees, so that at present we are utilizing the majority of our normal RD capacity. We currently plan to return to full RD capacity around the end of the summer, but note that a resurgence of COVID-19 and other factors could impact that timeframe.Second Quarter Financial Results Codexis is reporting two business segments: the Performance Enzymes segment, which consists of its protein catalyst and enzyme product and service offerings with a focus on pharmaceutical, food, molecular diagnostics and other industrial markets; and the Novel Biotherapeutics discovery and development segment.Total revenues for the second quarter of 2020 were 15.0 million, up 21 from 12.3 million for the second quarter of 2019. Product revenue was 4.5 million, compared with 6.2 million for the second quarter of 2019, with the decrease due to the timing of demand for various enzymes. Research and development RD revenue for the second quarter of 2020 was 10.5 million, up 72 from 6.1 million for the prior-year period, primarily due to revenues under the Novartis CodeEvolver licensing agreement and license fees from the Takeda collaboration, partially offset by lower revenue as a result of delays attributable to the COVID-19 pandemic. RD revenue for the second quarter of 2020 included 3.0 million from the Performance Enzymes segment and 7.5 million from the Novel Biotherapeutics segment. RD revenue for the second quarter of 2019 included 4.3 million from the Performance Enzymes segment and 1.7 million from the Novel Biotherapeutics segment.Gross margin on product revenue for the second quarter of 2020 was 62, up from 56 for the second quarter of 2019 due to product mix.RD expenses were 10.9 million for the second quarter of 2020, compared with 8.3 million for the second quarter of 2019, with the increase primarily due to higher regulatory expenses, higher headcount and higher allocable expenses, partially offset by lower lab supplies expenses and lower outside services. RD expenses for the second quarter of 2020 included 5.0 million from the Performance Enzymes segment and 5.5 million from the Novel Biotherapeutics segment. RD expenses for the second quarter of 2019 included 5.1 million from the Performance Enzymes segment and 2.9 million from the Novel Biotherapeutics segment.Selling, general and administrative SGA expenses for the second quarter of 2020 were 8.5 million, compared with 7.9 million for the second quarter of 2019, with the increase primarily due to costs associated with legal and accounting fees and outside services, and higher facilities and headcount, partially offset by lower allocable expenses. SGA expenses for the second quarter of 2020 included 2.4 million from the Performance Enzymes segment, 0.6 million from the Novel Biotherapeutics segment and the remaining portion is included in 5.8 million in corporate overhead, depreciation, amortization and other expenses, net. SGA expenses for the second quarter of 2019 included 2.4 million from the Performance Enzymes segment, 0.6 million from Novel Biotherapeutics and the remaining portion is included in 5.1 million in corporate overhead, depreciation, amortization and other expenses, net.The net loss for the second quarter of 2020 was 6.3 million, or 0.11 per share, compared with a net loss for the second quarter of 2019 of 6.5 million, or 0.12 per share. Non-GAAP net loss for the second quarter of 2020 was 3.9 million, or 0.07 per share, compared with non-GAAP net loss for the second quarter of 2019 of 4.1 million, or 0.08 per share. A reconciliation of GAAP to non-GAAP measures is provided below.Year-to-date Financial Results Total revenues for the six months ended June 30, 2020 were 29.6 million, up 6 from 27.9 million for the six months ended June 30, 2019, and included 20.0 million in RD revenue and 9.6 million in product revenue. RD revenue for the first six months of 2020 included 8.8 million from the Performance Enzymes segment and 11.2 million from the Novel Biotherapeutics segment. RD revenue for the first six months of 2019 included 6.4 million from the Performance Enzymes segment and 7.2 million from the Novel Biotherapeutics segment.Gross margin on product sales for the first six months of 2019 was 56, up from 50 for the prior-year period due to product mix.RD expenses for the first six months of 2020 were 21.8 million, compared with 16.3 million for the first six months of 2019, with the increase primarily due to higher regulatory expenses, higher headcount and higher allocable expenses, partially offset by lower lab supplies and outside services. RD expenses for the first half of 2020 included 10.7 million from the Performance Enzymes segment and 10.4 million from the Novel Biotherapeutics segment. RD expenses for first half of 2019 included 9.6 million from the Performance Enzymes segment and 6.2 million from the Novel Biotherapeutics segment.SGA expenses for the first six months of 2020 were 17.5 million, compared with 16.3 million for the first six months of 2019, with the increase due to an increase in costs associated with legal and accounting fees, higher facilities and headcount and licensed technology, partially offset by lower allocable expenses and lower travel expenses. SGA expenses for the first half of 2020 included 4.7 million from Performance Enzymes, 1.2 million from the Novel Biotherapeutics segment and the remaining portion is included in the 12.0 million in corporate overhead, depreciation and amortization expense, net. SGA expenses for the first half of 2019 included 4.5 million from the Performance Enzymes segment, 1.1 million from the Novel Biotherapeutics segment and the remaining portion is included in the 11.1 million in corporate overhead and depreciation and amortization expense, net.The net loss for the six months ended June 30, 2020 was 14.0 million, or 0.24 per share, compared with a net loss for the six months ended June 30, 2019 of 11.6 million, or 0.21 per share. Non-GAAP net loss for the first six months of 2020 was 9.0 million or 0.15 per share, compared with a non-GAAP net loss for the first six months of 2019 of 6.9 million, or 0.13 per share.Cash and cash equivalents as of June 30, 2020 were 75.6 million, compared with 90.5 million as of December 31, 2019.Non-GAAP Financial Measures Consolidated financial information has been presented in accordance with GAAP as well as on a non-GAAP basis. On a non-GAAP basis, financial measures exclude the non-cash items depreciation expense and stock-based compensation expense. Non-GAAP financial measures presented are non-GAAP net income or loss, non-GAAP net income or loss per share basic and diluted, non-GAAP RD expense and non-GAAP SGA expense. Non-GAAP operating expenses exclude stock-based compensation expense and depreciation of fixed assets.Codexis management uses these non-GAAP financial measures to monitor and evaluate the Companys operating results and trends on an ongoing basis, and internally for operating, budgeting and financial planning purposes. Codexis management believes the non-GAAP information is useful for investors by offering them the ability to identify trends in what management considers to be Codexis core operating results and to better understand how management evaluates the business. These non-GAAP measures have limitations, however, because they do not include all expenses that affect Codexis. 