The company yesterday reported a $1.22 million loss for the six months to September 30, compared to $544,000 a year earlier, but chairman Stephen Higgs said the company still needed additional capital despite the injection in September of $1.3 million.
Mr Higgs also announced yesterday several cost-saving measures.
These include the intention to delist from the New Zealand Stock Exchange, the closure of the Dunedin office with management activities moving to the factory site in the city, and the intention to appoint a joint general and technical manager instead of a chief executive.
Shareholder approval would be sought at a special general meeting of shareholders to delist, with Mr Higgs promising to enshrine in company rules the NZX equivalent of continuous disclosure to shareholders.
In addition to extra capital, he said Botry Zen needed more efficient and reliable production and significant sales growth both domestically and off shore.
Demand for its botry-zen product in New Zealand was such that it was in short supply.
September was a particularly difficult month for the biotechnology company, with production issues meaning manufacturing of its flagship botry-zen product was 80% of budget while raw material for Armour-zen was held up on the wharf.
Revenue for the six-month period under review grew from $2000 in 2007 to $16,000, but the cost of sales rose from $69,000 to $287,000 over the same period.
As a result equity fell from $1.833 million to $611,000.
Payments to suppliers and staff rose from $790,000 to $1.127 million which, along with interest on borrowings of $99,000 (zero previously) and higher GST liabilities, led to a worsening of its net cash position from negative $560,000 to negative $1.1 million.
Mr Higgs, who leads a relatively new board, said the challenge was to grow sales.
A report on the company's future by Price-waterhouseCoopers recognised its biological control products to control grape destroying fungus had the support of the viticulture industry, but it was yet to establish a commercially viable production process.
Solvency problems meant the loss of shareholder and bank support and to turn that around, Mr Higgs said the company had to improve its production techniques and grow profitable markets.
"Not surprisingly, further capital will be required to achieve these objectives," he said yesterday.
After shareholders in August rejected a $1.8 million capital raising bid by the board, Botry Zen was left insolvent as it had overdrawn its bank limits.
A $1.3 million rescue package was prepared by Michael Mellon of Mellic Innovators and a German investor Claus and Margarita Hartge.
