PURE Bioscience Boosts Balance Sheet by New
Grang Zeng, CFA
PURE BIOSCIENCE (PURE): Free Stock Analysis
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PURE Bioscience, Inc. (
announced the pricing of an underwritten public offering of
3,784,000 shares of its common stock, offered at a price to the
public of $1.10 per share.
The gross proceeds to PURE from this offering are expected to be
$4,162,400, before deducting the underwriting discount and other
estimated offering expenses payable by PURE. PURE has granted the
underwriters a 45-day option to purchase at the public offering
price up to an aggregate of 567,600 additional shares of common
stock to cover overallotments, if any. The offering is expected to
close on or about September 17, 2012, subject to customary closing
The offering is being made pursuant to a shelf registration
statement that PURE filed with the SEC and is effective.
While some investors view this offering negative, but we see this
financing positive in the long run.
This offering will boost the Company's balance sheet immediately.
As we pointed out before, cash burn is our chief concern. As of
April 30, 2012, the Company had cash and cash equivalents of
approximately $0.3 million. With proceeds from this offering, the
Company should have cash on hand of approximately $4 million, which
will last through the end of 2012.
Recently, PURE reported strong financial results for its third
fiscal quarter ended April 30, 2012.
Revenue for the quarter was $207,000, compared with revenue of
$128,000 for the same quarter of the prior year, an increase of
Gross margin as a percentage of net product sales was 82% and 71%
for the three months ended April 30, 2012 and 2011, respectively.
Going forward, we believe PURE can maintain a gross margin of
75-80% depending on product mix it markets. This is pretty
The net loss for the quarter was $1.8 million, or $0.04 per share,
compared with a net loss of $1.8 million, or $0.05 per share, in
the third quarter last year.
Revenue for the nine months ended April 30, 2012 was $685,000,
compared with revenue of $220,000 for the nine months ended April
30, 2011. The net loss for the nine months ended April 30, 2012 was
$6.4 million, or $0.15 per share, compared with a net loss of $6.3
million, or $0.17 per share, for the nine months ended April 30,
With the balance sheet boosted, PURE is in a better position to
execute its long term growth strategy.
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