Exhibit 99.1

LOGO

    Codexis, Inc.
    200 Penobscot Drive
    Redwood City, CA 94063
    Tel: 650.421.8100
    www.codexis.com

Codexis Reports Fourth Quarter and Full Year 2010 Results

Grows Annual Revenue 29% to $107 million;

77% Increase in Pharmaceutical Product Sales

Redwood City, CA – February 3, 2011 – Codexis, Inc. (NASDAQ: CDXS) today announced financial results for the fourth quarter and year ended December 31, 2010.

Full Year 2010 Financial Highlights:

Revenue: Revenue increased 29% to $107.1 million, driven by a 77% increase in sales of pharmaceutical products, from $18.6 million in 2009 to $32.8 million in 2010, and increases in collaborative R&D and government grants.

Operating Expenses: Full year operating expenses increased 2% to $86.2 million. R&D expenses decreased 4% to $52.4 million, primarily from the elimination of royalty payments to Maxygen as a result of our acquisition of Maxygen’s gene shuffling IP portfolio in October, 2010. SG&A expenses increased 13% to $33.8 million driven by increases in compensation and benefits and outside services costs associated with becoming a public company.

Net Loss: Net loss was ($8.5) million, or ($0.35) per share, based on 24.6 million weighted average common shares outstanding for the full year 2010. This compares to a net loss of ($20.3) million in 2009.

Adjusted EBITDA: On a non-GAAP basis, Adjusted EBITDA was $9.9 million compared to a loss of ($7.3) million in 2009. Adjusted EBITDA is calculated by adjusting net loss for net interest expense, income taxes, depreciation, amortization, stock-based compensation and preferred stock warrant fair market valuation. A reconciliation of net loss to Adjusted EBITDA is presented below.

Fourth Quarter Financial Highlights:

Revenue: For the fourth quarter of 2010, the company reported revenues of $29.8 million, an increase of 23% from $24.2 million in the fourth quarter of 2009, primarily due to an increase of $3.4 million in product revenue, representing an increase of 67% over the same time period of 2009.

 

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Operating Expenses: Research and development expenses in the fourth quarter of 2010 were $13.3 million, compared to $15.2 million for the fourth quarter of 2009. The decrease was primarily due to the reduction of royalty cost related to our acquisition of Maxygen’s gene shuffling IP portfolio and a reduction of costs related to our joint development agreement with CO2 Solution in 2009. Selling, general and administrative expenses in the fourth quarter of 2010 declined to $8.6 million compared to $8.9 million over the same time period of 2009 primarily due to a reduction in discretionary expenses.

Net Loss: Net loss was ($0.5) million, or ($0.01) per share, based on 34.5 million weighted average common shares outstanding in the fourth quarter of 2010. This compares to a net loss of ($5.2) million or ($1.95) per share during the fourth quarter of 2009.

Adjusted EBITDA: On a non-GAAP basis, Adjusted EBITDA increased from ($1.1) million in the fourth quarter of 2009 to $4.4 million in the fourth quarter of 2010. Adjusted EBITDA is calculated by adjusting net loss for net interest expense, income taxes, depreciation, amortization, stock-based compensation and preferred stock warrant fair market valuation. A reconciliation of net loss to Adjusted EBITDA is presented below.

Cash: Cash, and cash equivalents at December 31, 2010, decreased to $72.4 million compared to $99.3 million at September 30, 2010 primarily due to our $20.0 million purchase of the Maxygen, Inc. gene shuffling IP portfolio in October 2010 and our $3.7 million debt repayment.

“In addition to our solid financial results, we continued to exceed our goals in our targeted commercial opportunities,” said Alan Shaw, Ph.D, President and CEO. “We achieved our technical milestones with Shell, we made our first shipments of two important enzymes to Merck and we saw substantial progress in our efforts in carbon capture and chemicals.”

Outlook

Codexis’ statements with regard to its outlook are based on current expectations. The following statements are forward looking, and actual results could differ materially depending on market conditions and the factors set forth under “Forward-Looking Statements” below.

For the full year 2011, Codexis forecasts revenues of $120 million or greater, which would represent growth of 12% or greater compared to 2010. Codexis expects 2011 Adjusted EBITDA will be $5 million or greater.

Conference Call

Codexis will hold a conference call for investors on February 3, 2011 at 1:30 p.m. PT (4:30 p.m. ET). The conference call dial-in numbers are US: 866-788-0541 or International: 857-350-1679, access code 54501345. A live webcast of the call will also be available from the Investor Relations section of www.codexis.com. A recording of the call will be available by calling US: 888-286-8010 or International: 617-801-6888, access code 91197822 beginning approximately two hours after the call, and will be available for up to thirty days. A webcast replay from today’s call will also be available from the Investor Relations section of www.codexis.com approximately two hours after the call and will be available for up to thirty days.

 

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About Codexis, Inc.

Codexis is a clean technology company. Codexis develops optimized biocatalysts that make industrial processes faster, cleaner and more efficient. Codexis’ technology is commercialized with leading global pharmaceutical companies and in development for advanced biofuels with Shell and carbon capture with Alstom. Other potential markets for the company’s biocatalyst-enabled solutions include chemicals and water treatment.

Forward-Looking Statements

This press release contains forward-looking statements relating to the company’s forecast for 2011 revenue and Adjusted EBITDA, which is defined elsewhere in this press release. You should not place undue reliance on these forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond our control and that could materially affect actual results. Factors that could materially affect actual results can be found in Codexis’ Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 4, 2010, included under the caption “Risk Factors.” Codexis expressly disclaims any intent or obligation to update these forward-looking statements, except as required by law.

 

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Codexis, Inc.

Condensed Consolidated Statements of Operations

(Unaudited)

(In Thousands, Except Per Share Amounts)

 

     Three Months Ended           Twelve Months Ended        
     December 31,           December 31,        
     2010     2009     % change     2010     2009     % change  

Revenues:

            

Product

   $ 8,586      $ 5,152        67   $ 32,835      $ 18,554        77

Related party collaborative research and development

     19,275        18,693        3     66,148        62,656        6

Collaborative research and development

     1,471        358        311     4,048        1,652        145

Government grants

     479        35        nm        4,073        46        nm   
                                    

Total revenues

     29,811        24,238        23     107,104        82,908        29
                                    

Costs and operating expenses:

            

Cost of product revenues

     8,126        4,792        70     27,982        16,678        68

Gross margin $

     460        360          4,853        1,876     

Gross margin %

     5     7       15     10  

Research and development

     13,349        15,240        -12     52,405        54,725        -4

Selling, general and administrative

     8,649        8,932        -3     33,841        29,871        13
                                    

Total costs and operating expenses

     30,124        28,964        4     114,228        101,274        13
                                    

Loss from operations

     (313     (4,726     -93     (7,124     (18,366     -61

Interest income

     31        39        -21     166        180        -8

Interest expense and other, net

     (153     (507     -70     (1,199     (2,037     -41
                                    

Loss before provision (benefit) for income taxes

     (435     (5,194     -92     (8,157     (20,223     -60

Provision (benefit) for income taxes

     60        (13     nm        384        66        482
                                    

Net loss

   $ (495   $ (5,181     -90   $ (8,541   $ (20,289     -58
                                    

Net loss per share of common stock, basic and diluted

   $ (0.01   $ (1.95     $ (0.35   $ (7.74  
                                    

Weighted average common shares used in computing net loss per share of common stock, basic and diluted

     34,452        2,653          24,594        2,622     
                                    

 

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Codexis, Inc.

Condensed Consolidated Balance Sheets

(Unaudited)

(In Thousands)

 

     December 31,     December 31,  
     2010     2009  

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 72,396      $ 31,785   

Marketable securities

     —          23,778   

Accounts receivable, net

     10,620        7,246   

Related party accounts receivable

     4,713        —     

Inventories

     2,817        2,915   

Prepaid expenses and other current assets

     1,646        1,658   
                

Total current assets

     92,192        67,382   

Restricted cash

     1,466        731   

Property and equipment, net

     21,452        21,581   

Intangible assets, net

     20,158        928   

Goodwill

     3,241        3,241   

Other non-current assets

     2,791        5,173   
                

Total assets

   $ 141,300      $ 99,036   
                

Liabilities, redeemable convertible preferred stock, and shareholders’ equity (deficit)

    

Current liabilities:

    

Accounts payable

   $ 9,208      $ 9,999   

Accrued compensation

     8,107        6,518   

Related party payable

     —          1,314   

Other accrued liabilities

     5,630        10,376   

Redeemable convertible preferred stock warrant liability

     —          2,009   

Deferred revenues

     455        2,240   

Related party deferred revenues

     4,084        13,161   

Financing obligations

     —          5,368   
                

Total current liabilities

     27,484        50,985   

Deferred revenues, net of current portion

     1,671        1,856   

Related party deferred revenues, net of current portion

     3,403        7,487   

Financing obligations, net of current portion

     —          2,574   

Other long-term liabilities

     1,381        1,307   
                

Total liabilities

     33,939        64,209   

Redeemable convertible preferred stock issuable in series A to F

     —          179,672   

Stockholders’ equity (deficit):

    

Common stock

     4        —     

Additional paid-in capital

     275,540        15,015   

Accumulated other comprehensive loss

     (34     (252

Accumulated deficit

     (168,149     (159,608
                

Total stockholders’ equity (deficit)

     107,361        (144,845
                

Total liabilities, redeemable convertible preferred stock, and shareholders’ equity (deficit)

   $ 141,300      $ 99,036   
                

 

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Codexis, Inc.

Condensed Consolidated Statements of Cash Flow

(Unaudited)

(In Thousands)

 

     Twelve Months Ended
December 31,
 
     2010     2009  

Operating activities:

    

Net loss

   $ (8,541   $ (20,289

Adjustments to reconcile net loss to net cash used in operating activities:

    

Amortization of intangible assets

     1,063        957   

Depreciation and amortization of property and equipment

     7,246        5,172   

Revaluation of redeemable convertible preferred stock warrant liability

     677        627   

Loss (gain) on disposal of property and equipment

     148        (50

Extinguishment of royalty payable

     461        —     

Stock-based compensation

     8,737        4,822   

Accretion of asset retirement obligation

     146        43   

Amortization of debt discount

     26        311   

Accretion (amortization) of premium/discount on marketable securities

     511        594   

Changes in operating assets and liabilities:

    

Accounts receivable

     (8,087     (1,054

Inventories

     98        58   

Prepaid expenses and other current assets

     13        11   

Other assets

     2,814        (228

Accounts payable

     (791     189   

Accrued compensation

     1,589        2,434   

Related party payable

     (1,314     879   

Other accrued liabilities

     (6,048     (3,792

Deferred revenues

     (15,131     530   
                

Net cash used in operating activities

     (16,383     (8,786
                

Investing activities:

    

(Increase) decrease in restricted cash

     (735     193   

Purchase of property and equipment

     (6,990     (10,697

Purchase of marketable securities

     (49,051     (37,118

Purchase of Maxygen patent portfolio

     (20,705     —     

Proceeds from sale of marketable securities

     1,605        —     

Proceeds from maturities of marketable securities

     70,695        27,980   

Proceeds from disposal of property and equipment

     15        —     

Purchase of CO2 Solution common shares

     —          (1,316
                

Net cash provided by (used in) investing activities

     (5,166     (20,958
                

Financing activities:

    

Principal payments on financing obligations

     (8,026     (6,087

Payments in preparation for initial public offering

     (3,870     (959

Proceeds from issuance of preferred stock, net of issuance costs

     —          46,926   

Proceeds from issuance of common stock on IPO, net of underwriting discounts

     72,541        —     

Proceeds from exercises of stock options

     1,594        117   
                

Net cash provided by financing activities

     62,239        39,997   
                

Effect of exchange rate changes on cash and cash equivalents

     (79     (371
                

Net increase in cash and cash equivalents

     40,611        9,882   

Cash and cash equivalents:

    

Beginning of the period

     31,785        21,903   
                

End of the period

     72,396        31,785   

Marketable securities at the end of period

     —          23,778   
                

Cash, cash equivalents and marketable securities

   $ 72,396      $ 55,563   
                

 

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Reconciliation of GAAP to Non-GAAP Financial Information

In this press release, in addition to GAAP financial results, we present Adjusted EBITDA because we believe it assists investors and analysts in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance. In addition, we use Adjusted EBITDA as a factor in evaluating management’s performance when determining incentive compensation and to evaluate the effectiveness of our business strategies.

A reconciliation of GAAP net loss to Adjusted EBITDA is included in the table below.

Codexis, Inc.

Reconciliation of GAAP Net Loss to Adjusted EBITDA

(Unaudited)

(In Thousands)

 

      Three months ended
December 31,
    Twelve months ended
December 31,
 

Calculation of Adjusted EBITDA

   2010     2009     2010     2009  

Net loss

   $ (495   $ (5,181   $ (8,541   $ (20,289

Adjustments:

        

Minus: Interest income

     (31     (39     (166     (180

Plus: Interest expense

     5        336        529        1,413   

Plus: Income taxes

     60        (13     384        66   

Plus: Depreciation and amortization

     2,593        1,713        8,266        6,119   

Plus: Stock-based compensation

     2,296        1,763        8,728        4,912   

Plus: Preferred stock warrant fair market valuation adjustment

     —          277        677        627   
                                

Adjusted EBITDA

   $ 4,428      $ (1,144   $ 9,877      $ (7,332
                                

Adjusted EBITDA has limitations as an analytical tool. Some of these limitations are:

Adjusted EBITDA does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;

Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements; and

Non-cash compensation is and will remain a key element of our overall long-term incentive compensation package, although we exclude it as an expense when evaluating our ongoing operating performance for a particular period.

Because of these limitations, Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using Adjusted EBITDA only supplementally.

 

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Contacts:

Investors: Cynthia Hiponia, cynthia@blueshirtgroup.com, 415-217-4966

Media: Lyn Christenson, lyn.christenson@codexis.com, 650-421-8144 or Saskia Sidenfaden, ssidenfaden@mww.com, 212-827-3771.

 

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