February 26, 2009 / 2:12 PM / 9 years ago

UPDATE 1-Bellus says needs capital to continue as going concern

* Needs additional financing to continue as going concern

* Q4 shr loss $0.23 vs shr loss $0.33 prior year

Feb 26 (Reuters) - Bellus Health Inc BLU.TO said it doubts its ability to continue as a going concern beyond the first quarter of 2009 if it fails to raise cash, even as it posted a narrower quarterly loss.

The company said it is due to make interest payments totalling about $2.8 million in May and November this year on its 2006 and 2007 convertible notes.

The company said it will be in default if it fails to make the payments and will have insufficient funds to meet its obligation if the holders exercise the right to redeem the notes.

The company said it has incurred significant operating losses and negative cash outflows from operations since inception and has an accumulated deficit of $366.5 million at Dec. 31.

At the end of 2008, the company had available cash, cash equivalents and marketable securities of $10.6 million.

The company said it is actively pursuing additional financing and is also in discussions and due diligence with several other potential investors and pharmaceutical companies regarding potential financings or collaborations.

For the fourth quarter, the company reported a net loss of $11.5 million, or 23 cents a share, compared with a net loss $16.1 million, or 33 cents a share, a year earlier.

The company’s stock, which was delisted from Nasdaq in January this year, closed at 38 Canadian cents Wednesday on Toronto Stock Exchange.

For alerts, double-click on [ID:nWNAB7302] (Reporting by Anuradha Ramanathan in Bangalore; Editing by Deepak Kannan)

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