dyai20240930c

dyai20240930c_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2024

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to ______

Commission File Number: 000-55264

DYADIC INTERNATIONAL, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware		45-0486747
State or Other Jurisdiction of Incorporation or Organization		I.R.S. Employer Identification No.

1044 North U.S. Highway One, Suite 201
Jupiter, Florida		33477
Address of Principal Executive Offices		Zip Code

(561) 743-8333

	Registrant’s Telephone Number, Including Area Code
		N/A
	Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, par value $0.001 per share			DYAI			The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐						Accelerated filer ☐

Non-accelerated filer ☒						Smaller reporting company ☒

						Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s Common Stock as of November 11, 2024 was 29,589,371.

TABLE OF CONTENTS

		Page
PART I FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	22
Item 4.	Controls and Procedures	22

PART II OTHER INFORMATION
Item 1.	Legal Proceedings	23
Item 1A.	Risk Factors	23
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	23
Item 3.	Defaults Upon Senior Securities	23
Item 4.	Mine Safety Disclosures	23
Item 5.	Other Information	23
Item 6.	Exhibits	23
Signatures		24

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This quarterly report on Form 10-Q (“Quarterly Report”) contains forward-looking statements within the meaning of the federal securities laws, particularly under Item 2 “Management’s Discussion and Analysis.” All statements other than statements of historical fact are forward‑looking. Examples of forward-looking statements include, but are not limited to, statements regarding industry prospects, future business, future results of operations or financial condition, future liquidity and capital resources, our ability to implement our agreements with third parties, management strategies, and our competitive position. Forward-looking statements generally can be identified by use of the words “expect,” “should,” “intend,” “anticipate,” “will,” “project,” “may,” “might,” “potential,” or “continue” and other similar terms or variations of them or similar terminology. Dyadic International, Inc., and its subsidiaries cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information. Such statements reflect the current views of our management with respect to our operations, results of operations and future financial performance.

Forward-looking statements involve many risks, uncertainties, or other factors beyond Dyadic’s control. These factors include, but are not limited to (i) our history of net losses; (ii) market and regulatory acceptance of our microbial protein production platforms and other technologies; (iii) competition, including from alternative technologies; (iv) the results of nonclinical studies and clinical trials; (v) our capital needs; (vi) changes in global economic and financial conditions; (vii) our reliance on information technology; (viii) our dependence on third parties; (ix) government regulations and environmental, social and governance issues; (x) intellectual property risks and (xi) other factors discussed in Dyadic’s publicly available filings, including information set forth under the caption “Risk Factors” in this Quarterly Report and in our annual report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 28, 2024 (the “Annual Report”). We caution you that the foregoing list of important factors is not exclusive. Any forward-looking statements are based on our beliefs, assumptions, and expectations of future performance, considering the information currently available to us. Before investing in our common stock, investors should carefully read the information set forth under the caption “Risk Factors” and elsewhere in this Quarterly Report, in our Annual Report and in our other SEC filings, which could have a material effect on our business, results of operations and financial condition. The forward-looking statements contained in this Quarterly Report are made only as of the date hereof, and except as required by law, we undertake no obligation to publicly update any forward-looking statements for any reason after the date of this Quarterly Report to conform these statements to actual results or to changes in our expectations.

PART I

Item 1.

Financial Statements

DYADIC INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	*September 30, 2024*			*December 31, 2023*
	(Unaudited)			(Audited)
Assets
Current assets:
Cash and cash equivalents	$	5,921,614		$	6,515,028
Short-term investment securities		4,000,832			748,290
Interest receivable		40,835			10,083
Accounts receivable		352,934			466,159
Prepaid expenses and other current assets		374,209			327,775
Total current assets		10,690,424			8,067,335

Non-current assets:
Operating lease right-of-use asset, net		104,914			141,439
Other assets		10,328			10,462
Total assets	$	10,805,666		$	8,219,236

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	561,797		$	656,445
Accrued expenses		839,420			1,057,164
Deferred research and development obligations		514,483			490,113
Operating lease liability, current portion		53,476			48,059
Accrued interest		80,000			—
Accrued interest- related party		28,000			—
Total current liabilities		2,077,176			2,251,781

Non-current liabilities:
Convertible notes, net of issuance costs		3,902,435			—
Convertible notes, net of issuance costs - related party		1,365,852			—
Operating lease liability, net of current portion		48,091			88,870
Total liabilities		7,393,554			2,340,651

Commitments and contingencies (Note 5)

Stockholders’ equity:
Preferred stock, $.0001 par value:
Authorized shares - 5,000,000; none issued and outstanding		—			—
Common stock, $.001 par value:
Authorized shares - 100,000,000; issued shares - 41,842,873 and 41,064,563, outstanding shares - 29,589,371 and 28,811,061 as of September 30, 2024, and December 31, 2023, respectively		41,843			41,065
Additional paid-in capital		106,835,784			105,044,756
Treasury stock, shares held at cost - 12,253,502		(18,929,915	)		(18,929,915	)
Accumulated deficit		(84,535,600	)		(80,277,321	)
Total stockholders’ equity		3,412,112			5,878,585
Total liabilities and stockholders’ equity	$	10,805,666		$	8,219,236

The accompanying notes are an integral part of these unaudited consolidated financial statements.

DYADIC INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	*Three Months Ended September 30,*						*Nine Months Ended September 30,*
	*2024*			*2023*			*2024*			*2023*
Revenues:
Research and development revenue	$	532,500		$	352,942		$	1,253,013		$	2,079,918
License revenue		1,425,000			44,118			1,425,000			132,353
Total revenue		1,957,500			397,060			2,678,013			2,212,271

Costs and expenses:
Costs of research and development revenue		395,894			105,869			841,805			1,625,731
Research and development		460,241			716,351			1,498,593			2,444,469
General and administrative		1,297,984			1,282,361			4,694,334			4,164,970
Foreign currency exchange loss		5,995			12,600			14,044			38,143
Total costs and expenses		2,160,114			2,117,181			7,048,776			8,273,313

Loss from operations		(202,614	)		(1,720,121	)		(4,370,763	)		(6,061,042	)

Other income (expense):
Interest income		127,331			105,862			353,245			319,787
Gain on sale of Alphazyme		—			—			60,977			1,017,592
Interest expense		(88,833	)		—			(199,106	)		—
Interest expense - related party		(39,344	)		—			(102,632	)		—
Total other income (expense), net		(846	)		105,862			112,484			1,337,379

Net loss	$	(203,460	)	$	(1,614,259	)	$	(4,258,279	)	$	(4,723,663	)

Basic and diluted net loss per common share	$	(0.01	)	$	(0.06	)	$	(0.15	)	$	(0.16	)

Basic and diluted weighted-average common shares outstanding		29,503,143			28,811,061			29,225,861			28,794,712

The accompanying notes are an integral part of these unaudited consolidated financial statements.

DYADIC INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

	*Nine Months Ended September 30, 2024*
	*Common Stock*				*Treasury Stock*						*Additional Paid-In*			*Accumulated*
	*Shares*		*Amount*		*Shares*			*Amount*			*Capital*			*Deficit*			*Total*
January 1, 2024		41,064,563	$	41,065		(12,253,502	)	$	(18,929,915	)	$	105,044,756		$	(80,277,321	)	$	5,878,585
Stock-based compensation expense		—		—		—			—			306,478			—			306,478
Issuance of common stock upon vesting of restricted stock units		375,753		376		—			—			339,959			—			340,335
Net loss		—		—		—			—			—			(2,009,596	)		(2,009,596	)
March 31, 2024		41,440,316	$	41,441		(12,253,502	)	$	(18,929,915	)	$	105,691,193		$	(82,286,917	)	$	4,515,802
Stock-based compensation expense		—		—		—			—			297,603			—			297,603
Issuance of common stock upon vesting of restricted stock units		61,793		62		—			—			(62	)		—			—
Issuance of common stock upon exercise of stock options		5,569		6		—			—			(6	)		—			—
Issuance of common stock upon settlement of convertible debt		223,463		223		—			—			399,777			—			400,000
Net loss		—		—		—			—			—			(2,045,223	)		(2,045,223	)
June 30, 2024

SEC Form 10-Q filed by Dyadic International Inc.