Techniclone Reports Third-Quarter Loss of $3.9 Million
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TUSTIN — Techniclone Corp., the struggling developer of experimental cancer treatments, said Tuesday it lost $3.9 million for its fiscal third quarter and was given an extension until summer to pay $1.9 million in bills coming due.
A contractor working on revamping the company’s Tustin production facility agreed to give the company until June 30 to make the payment, the company said Tuesday. It did not identify the contractor.
Techniclone also said the contractor and another company, Biotech Development Ltd., have agreed to lend the company as much as $2.5 million to help it meet its short-term financing needs. Edward Joseph Legere III, a Techniclone director who controls 7.43% of its stock, is a principal in Biotech Development.
Techniclone has enough cash to last through June, said Elizabeth Gorbett-Frost, the company’s vice president of finance and administration.
“We want to let our investors know that we do have commitments for funds that will carry us through the short term,” she said.
Still, the company hopes to replace those commitments with short-term financing on better terms, Gorbett-Frost said. It also is looking for $20 million to $60 million in long-term financing, possibly from a group of European investors, she said.
The company’s third-quarter loss, amounting to 14 cents a share, was more than double its $1.5 million loss, or 7 cents a share, for last year’s third quarter. It did not report sales figures or year-to-date figures.
About $1 million of the loss for the quarter that ended Jan. 31 stems from discounts on preferred stock issued in the last year as well as related items, the company said.
In little more than a year, the company’s stock price has dropped from about $6 a share to about 50 cents a share. It closed at 56 cents a share Tuesday, unchanged from Monday’s close on the Nasdaq market system.
Company officials have partly blamed the drastic deterioration in its stock price on dilution caused by recent conversions of preferred stock.
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