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Cereplast, Inc. (NASDAQ: CERP) 133% Jump In Revenue and $12 Million in the Bank

Date: February 11, 2011 4:11 PM
Publisher: EQUITIES Editors Desk
Source: Tom Copeland
Categories: US Markets
Tags: (NASDAQ:CERP), cereplast, equities, bioplastics, prviate placement, euroink romania, green tech, recycling, merriman capital inc, lazard capital markets

Cereplast, Inc., the leading manufacturer of proprietary bio-based, compostable and sustainable plastics in Europe, announced a securities purchase agreement the company struck with institutional investors last month worth approximately $12 million. The bioplastics manufacturer has been on a roll in Europe, preparing to amplify its production to meet the demands of new deals in Italy, Romania and elsewhere.

The green-plastics company agreed to sell about 2.6 million units consisting of one share of common stock and warrants to purchase 0.25 shares of common stock at a price of $4.75 per unit and at an exercise price of $6.35 a share. The resulting bottom-line proceeds for Cereplast are approximately $12 million less $1 million relating to fees and expenses incurred during the transaction. Today, shares of Cereplast are up 3.5% to settle around $5.00 a pop.

Legendary investment bankers Lazard Capital Markets served as lead placement agent for the offering with Merriman Capital, Inc. and Ardour Capital Investments, acting as co-placement agents. Cereplast plans to use the funds as working capital to bolster cash receipts as the company continues its rapidly growing product order pipeline that includes its Compostables and Sustainables Resins offerings.

The two bio-based, synthetically converted bioplastic products are ideally suited for single use applications where compostability one-time use is advantageous like in the food service industry. Even more appetizing for investors is that the company is able to sell its bioplastics at a price point that is competitive with the petroleum-based plastics that rule our world today.

Those product lines are indeed growing. During the first three weeks of 2011, Cereplast announced new distribution agreements in Italy, Romania, Poland and Slovenia with multiple companies. These contracts reflect Cereplast's rapid growth and expansion across the Pan-European marketplace, a bustling hub for demand among environmentally conscious companies that use plastics in their everyday operations (think packaging, shipping, and utensils, etc).

The books can back up the momentum. This past year Cereplast's total sales revenue was up 133%, from $2.7 million in 2009 to $6.3 million for 2010. Projected revenue for the 2011, according to senior executive members: between $24 million and $32 million, a 300% to 400% increase compared to 2010.

Frederic Scheer, Chairman and CEO of Cereplast, has been saying all year long that demand for bioplastic resin in Europe is soaring, especially in Poland. "The increasing market penetration we are gaining in various parts of Europe gives us greater visibility to outline our growth expectations for 2011", he said.

The private placement transaction closed on February 1, 2011. With a bank account full of capital and a worldwide push towards greater sustainability and bio-based product manufacturing and consumption, Cereplast could put its 2011 full year revenues over the edge – again.

http://www.worldmarketmedia.com/779/section.aspx/2991/post/cereplast-inc-nasdaq-cerp-133-jump-in-revenue-and-12-million-in-the-bank