March 28, 2018 – Paul Morden, Sarnia Observer – BioAmber, a Montreal-based company with a manufacturing site in Sarnia, reported a record quarter at the end of 2017 with revenue of $5.4 million.
Revenue in 2017 totalled $14.9 million compared to $8.3 million in 2016, an 81-per-cent increase, driven by increased sales of bio-succinic acid from the Sarnia plant opened in 2015, the company said this week.
BioAmber uses corn syrup to make succinic acid, a building block chemical used in products ranging from paints and plastics to cosmetics and food additives at its first large-scale commercial production site next to Vidal Street in Sarnia.
“We are pleased with the solid growth, which is reflective of our growing customer base and the potential of bio-succinic acid as an important chemical building block,” CEO Rick Eno said Wednesday during a quarterly earnings conference call.
“The entire company is working to move our operations to be gross margin positive at the plant level, followed by profitability at the corporate level,” Eno said.
“We believe this performance will unlock growth opportunities for us, including a second plant that will convert bio-succinic acid into butanediol and THF (tetrahydrofuran), which reflect an $8-billion market.”
The company said in late 2017 it was focusing on Sarnia as the potential site for a second plan.
Eno said BioAmber has an “aggressive” program to reduce costs at the Sarnia plant by 25 to 35 per cent while maintaining high product quality.
“We believe we are the lowest cost producer in the world and will continue to aggressively drive down our cost structure,” he said.
Earlier this year, BioAmber renegotiated debt and raised $7 million in an equity offering, Eno said.
“We are currently working with partners, lenders and other investors as we continue to fund the company’s growth.”
The company’s shares were de-listed recently by the New York Stock Exchange and Toronto Stock Exchange but Eno said BioAmber is “evaluating a number of alternatives to regain a listing on a major exchange.”
BioAmber added five new customers in the fourth quarter of 2017 and another eight in early 2018, giving it more 80 in 17 countries.
“The promise of bio-succinic acid is panning out and we’re growing the business substantially,” Eno said.
He said the company is working with several customers on new applications, including animal feed and PET plastic containers.
“Bio-succinic acid is showing potential to reduce the cost, as well as the greenhouse gas impact, of PET bottle production,” Eno said.
“We are scaling up this innovation with developmental partners in China and Europe.”
Eno said BioAmber has also been accepted into Ontario’s cap and trade system and expects to benefit from selling carbon credits.
“We foresee the sale of these credits having a positive impact as we ramp up to full capacity.”
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