December 20, 2011 / 2:23 PM / in 6 years

UPDATE 2-BioExx sees slowing protein output growth, shares fall

* Protein output rises 67 pct in December from previous month

* Sees moderate output growth going forward

* Hires Canaccord genuity as adviser for strategic review

* Shares fall as much as 14 pct (Adds details, analysts’ comments, share movement)

By Ankur Banerjee

Dec 20 (Reuters) - BioExx Specialty Proteins forecast muted production growth at its primary canola processing facility, raising concerns about its ability to attract a partner for the plant .

The news pushed the company’s shares down as much as 14 percent. They later recouped some losses to trade down 3 percent at 18 Canadian cents on Tuesday afternoon on the Toronto Stock Exchange.

Toronto-based BioExx has been looking for a strategic partner to inject cash into the facility, which resumed production in October after an upgrade.

BioExx, which hired Canaccord Genuity Corp to help find a partner, has seen its stock plunge more than 90 percent so far this year as it struggled to deal with rising seed and input costs.

The company has also found it difficult to generate capital to use its technology for extracting protein from oilseeds.

The company, which adopted a shareholders rights plan in November, said protein production at the plant is coming in at 2 tonnes per week (104 tonnes per year) so far in December, up from 1.2 tonnes in November.

However, the current run rate implies annual production of 104 tonnes, or just 1.4 percent of its full capacity of 7,200 tonnes per year, Altacorp Capital analyst John Chu said in a client note.

“They have to demonstrate to the market that they have scalable technology that will be attractive to a strategic partner,” Raymond James analyst Steve Hansen told Reuters.

“The current production rate is not enough to deem any commercial success.” (Reporting by Ankur Banerjee in Bangalore; Editing by Sreejiraj Eluvangal, Viraj Nair)

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