May 15, 2009 / 6:41 PM / 9 years ago

UPDATE 1-Ambrilia doubts ability to continue as going concern

* Says unlikely to comply with debt covenants

* Looking at merger or sale of co

* Q1 loss C$0.11/shr vs. year-ago loss C$0.15/shr

May 15 (Reuters) - Canada’s Ambrilia Biopharma Inc AMB.TO said there was substantial doubt about its ability to continue as a going concern if it fails to raise money, and it is unlikely that it will be in compliance with its debt covenants beginning in the second quarter.

Ambrilia said it is looking at alternatives, including a sale or merger of the company or monetization of its assets through sale or licensing transactions.

The company said it has incurred significant operating losses since its inception and its anticipated level of future net annual expenditures exceeds its cash and cash equivalents as at March 31.

If it is unable to obtain additional financial resources, it may be required to further curtail operations, the biotechnology company said in a statement.

For the first quarter, the company reported a loss of C$5.4 million ($4.61 million), or 11 Canadian cents per share, compared with a loss of C$7.3 million, or 15 cents per share, a year earlier.

Revenue plunged 93 percent to C$18,739, due to a combination of lower cash and short-term investments on hand and lower interest rates on them.

Ambrilia shares were trading at 6 Canadian cents Friday on the Toronto Stock Exchange. ($1=1.171 Canadian Dollar) (Reporting by R. Manikandan in Bangalore; Editing by Deepak Kannan)

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