Mr. Michael Kirwan reports

BURCON ANNOUNCES FISCAL 2016 RESULTS AND REVIEWS OPERATIONS

Burcon NutraScience Corp. has released results for the year ended March 31, 2016.

Fiscal 2016 operational highlights:

• The company completed an oversubscribed rights offering on April 30, 2015, for gross proceeds of $3.5-million, with net proceeds of $3.35-million.
• It continued discussions with certain multinational food ingredient providers for a royalty or a joint operations agreement for Peazazz.
• Burcon's Winnipeg technical centre undertook Peazazz applications work and provided significant quantities of samples throughout the year in response to requests from and in support of analytical work conducted by these potential commercialization partners.
• Burcon's exclusive manufacturing and marketing partner for Clarisoy, Archer Daniels Midland Company (ADM), facilitated Clarisoy development activities in the global food and beverage market while operating the world's first Clarisoy semi-works plant to produce samples of the Clarisoy soy protein line for market development purposes.
• The company participated in planning and realization activities in support of the construction of the first full-scale commercial Clarisoy production facility with ADM. Burcon expects ADM's first full commercial-scale Clarisoy production facility to be operational in mid-2016.
• It received four U.S. patent grants, bringing the company's patent portfolio to 200 issued patents in various countries, including 61 in the United States, as well as more than 380 active patent applications, including 57 additional U.S. patent applications.
• Subsequent to the year-end, Burcon issued a convertible note for the principal amount of $2.0-million, with net proceeds of $1.93-million.

Management commentary

Over the course of the past year, Burcon witnessed significant advancements for the Clarisoy soy protein line, its lead product, by its licence partner, Archer Daniels Midland. In late 2014, ADM closed its largest acquisition in its corporate history, acquiring Wild Flavors GmbH for $3.1-billion (U.S.) and merging those assets with ADM's existing specialty ingredients and foods and wellness division to create the new Wild flavours and specialty ingredients (WFSI) business unit. Clarisoy is now being produced, marketed and sold within this new business unit, a business unit ADM has publicly stated will be a driver of its future growth. Following on the acquisition of Wild Flavors GmbH and the creation of the WFSI business unit, ADM began the construction of the first full-scale production plant for Clarisoy, which Burcon expects will be operational by mid-2016.

During the past year, Burcon realized similarly important developments with its second major technology, its Peazazz pea protein. Burcon has operated its Peazazz semi-works production facility, which utilizes commercial-scale equipment and is capable of producing the tonnage amounts of Peazazz required by food and beverage makers looking to conduct full-scale, real-world market evaluations of Peazazz in their consumer products, to continue the development of the Peazazz commercial opportunity.

Burcon advanced its discussions with multiple potential partners over the past year. These partners have conducted product testing, applications development, pricing analyses and real-life consumer trials to test the market potential for Peazazz sales. Peazazz exhibits unique potential in key applications and is expected to garner significant sales opportunities. The company remains confident of the ability to enter into a commercialization partnership for its Peazazz pea protein technology and to commercialize the opportunity in partnership with an established food ingredients industry player.

The company sees continued acceleration of the demand for protein ingredients globally and specifically for plant protein. Burcon believes it is extremely well positioned, both through the royalty arrangement with ADM on Clarisoy and the discussions with potential partners for Peazazz to derive benefits from the global trend for protein and health and wellness in general.

Financial results

Revenues totalled $106,000 for the year, relatively unchanged from the same year-ago period, and were derived mainly from deferred royalty payments from ADM for Clarisoy sales. The nominal revenues reflect the company's development-phase status as it transitions to the commercial stage.

Royalty revenues from the sale of Clarisoy by ADM as produced from its semi-works facility in Decatur, Ill., have been marginal. The main purpose of the semi-works plant has been to provide commercial samples for market development purposes and to facilitate other product development work.

Net loss totalled $6.6-million or 18 cents per basic and diluted share for fiscal 2016, as compared with a net loss of $6.6-million or 20 cents per basic and diluted share in fiscal 2015.

Research and development expenses totalled $2.7-million for the year, as compared with $2.5-million in fiscal 2015. The increase in R&D expenses over last year is mainly attributed to higher repairs and maintenance and equipment rental costs, as well as higher stock-based compensation expense.

General and administrative (G&A) expenses decreased to $4.2-million in fiscal 2016 from $4.5-million in the fiscal 2015. The bulk of the decrease in G&A expenses for the quarter is due to a reduction in patent legal fees, with higher expenses incurred during fiscal 2015 from four additional patent applications that had entered the national phase during fiscal 2015 than fiscal 2016. This was offset by higher stock-based compensation expense in the current year.

At March 31, 2016, cash balances totalled $2.5-million compared with cash and short-term investments of $3.7-million at March 31, 2015. In May, 2016, Burcon issued a convertible note for $2.0-million, with net proceeds of $1.93-million. Management believes it has sufficient resources to finance its expected level of operations and working capital requirements until at least January, 2017. This estimate does not take into account potential proceeds from outstanding convertible securities, royalty revenues from the sale of Clarisoy, or any other potential revenue from product sales or licensing.

The company's complete financial statements, along with management's more detailed discussion and analysis, are available from the company's investors section at the Burcon website or from SEDAR.

                                   
     CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS         
                        (prepared in dollars)    
  
                                           For the years ended March 31,                        
                                                   2016            2015
Revenue
Royalty income                                 $106,390        $105,387
Expenses
General and administrative                    4,237,968       4,458,694
Research and development                      2,653,585       2,535,761
                                              6,891,553       6,994,455
(Loss) from operations                       (6,785,163)     (6,889,068)
Foreign exchange gain                            62,230         118,642
Interest and other income                       153,157         191,002
(Loss) and comprehensive (loss)
for the period                               (6,569,776)     (6,579,424)
Basic and diluted (loss) per share                (0.18)          (0.20)

We seek Safe Harbor.