Press Releases

JUPITER, Fla., May 5, 2011 – Dyadic International, Inc. (“Dyadic”) (OTC Pink: DYAI), a global biotechnology company focused on the discovery, development, manufacture and sale of enzyme and protein products for the bioenergy, industrial enzyme and biopharmaceutical industries, today announced financial results for the quarter ended March 31, 2011. The financial information contained in this press release should be read in conjunction with the financial statements and related footnotes which have been posted on the OTC Markets website at www.otcmarkets.com and on Dyadic’s website atwww.dyadic.com.

Dyadic’s President and Chief Executive Officer, Mark Emalfarb, stated, “During the first quarter, Dyadic achieved strong growth in research revenue which continues to serve as the proving ground for future licensing and other third party collaborations. We also experienced improving margins in our enzyme business and launched two new products for the pulp & paper and biofuels markets which are currently being sampled and undergoing trials by new and existing customers. Finally, we added to the value and protection of our products and technologies with the issuance of several new U.S. patents.”

First Quarter Highlights and Recent Events

  1. Total revenue for the first quarter increased approximately 15% over the same period last year highlighted by a greater than five-fold increase in research and development revenue

  1. Product margins for the first quarter increased compared to the previous year’s first quarter

  1. Gross profit for the first quarter increased by approximately 95% over the same period last year as a result of higher research revenue, improved product margins and further cost controls and operational efficiencies

  1. Launched two new products: FibreZyme® G200 and AlternaFuel®CMAX™, for the pulp and paper and biofuels markets

  2. Received four new U.S. patents

  1. Completed negotiations and entered into R&D collaboration with Sanofi Pasteur and EnGen Bio for certain vaccine applications of Dyadic’s patented C1 technology

FINANCIAL RESULTS

Total revenue for the three months ended March 31, 2011 increased approximately 15% to approximately $2.3 million, as compared to approximately $2.0 million for the three months ended March 31, 2010. The increase was primarily attributable to research revenue of approximately $491,000 for the three months ended March 31, 2011, as compared to approximately $88,000 for the same period in the prior year, reflecting Dyadic’s continued commitment to increasing its revenue-generating research and development projects in addition to internally funded projects.

Gross profit for the first quarter of 2011 increased approximately 95% to approximately $768,000 from approximately $394,000 in the first quarter of 2010. The increase was due mainly to higher gross margins on product sales, increased research and development activity which generally has higher contribution margins, and further cost controls and operational efficiencies.

General and administrative expenses for the three months ended March 31, 2011 increased approximately 24% to approximately $1.7 million, as compared to approximately $1.4 million for the same period last year due primarily to increased litigation costs.

Net loss for the quarter ended March 31, 2011 was approximately $1.5 million, or $(0.05) per basic and diluted share, as compared to a net loss of approximately $1.1 million, or $(0.04) per basic and diluted share for the quarter ended March 31, 2010. In 2010, Dyadic recorded a gain on reduction of accrued stockholder litigation of $410,000, which accounted for the majority of the difference.

At March 31, 2011, cash and cash equivalents were approximately $3.1 million and working capital was approximately $4.2 million.

ABOUT DYADIC

Dyadic International, Inc. is a global biotechnology company that uses its patented and proprietary technologies to conduct research, development and commercial activities for the discovery, development, manufacture and sale of enzyme and protein products for the bioenergy, industrial enzyme and biopharmaceutical industries.

Dyadic makes financial disclosures through the OTC Disclosure and News Service which offers free information on the OTC Markets website (www.otcmarkets.com) concerning companies traded on the OTC Markets. Investors can access and download Dyadic’s financial reports and other announcements that Dyadic makes through the OTC Markets website. Dyadic will also continue providing updates through regular press releases as appropriate.

CAUTIONARY STATEMENT FOR FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release are forward- looking statements. These forward-looking statements involve risks and uncertainties that could cause Dyadic’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Except as required by law, Dyadic expressly disclaims any intent or obligation to update any forward-looking statements.

DYADIC INTERNATIONAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended March 31,

2011

2010

Revenue:

(Unaudited)

(Unaudited)

Product Related Revenue, Net

$

1,805,208

$

1,879,145

License Fee Revenue

32,000

Research and Development Revenue

491,309

88,235

Total Revenue

2,296,517

1,999,380

Cost of Goods Sold

1,528,227

1,605,324

Gross Profit

768,290

394,055

Expenses:

General and Administrative

1,684,690

1,359,667

Sales and Marketing

267,734

226,733

Research and Development

304,003

286,042

Foreign Currency Exchange Losses (Gains), Net

(94,034)

33,294

Total Expenses

2,162,393

1,905,736

(Loss) from Operations

(1,394,103)

(1,511,681)

Other Income (Expense):

Interest Income

4,191

21,270

Interest Expense

(113,006)

(33,379)

Gain on Reduction of Accrued Stockholder Litigation

410,000

Total Other Income (Expense)

(108,815)

397,891

Net (Loss)

$

(1,502,918)

$

(1,113,789)

Net (Loss) per Common Share

Basic

$

(0.05)

$

(0.04)

Diluted

$

$

(0.05)

(0.04)

Weighted Average Common Shares Used in Calculating Net (Loss) Per Share:

Basic

31,150,620

30,832,621

Diluted

31,150,620

30,832,621

DYADIC INTERNATIONAL, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

March 31,

December 31,

ASSETS

2011

2010

(Unaudited)

Current Assets:

Cash and Cash Equivalents

$

3,121,189

$

4,535,279

Restricted Cash

263,934

247,082

Accounts Receivable, Net

1,517,157

1,276,574

Inventory, Net

2,831,189

2,782,433

Prepaid Expenses and Other Current Assets

447,490

336,638

Total Current Assets

8,180,959

9,178,006

Fixed Assets, Net

648,631

719,161

Intangible Assets, Net

354,609

310,978

Other Assets

16,929

16,930

$

9,201,128

$

10,225,075

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:

Accounts Payable

$

1,925,827

$

1,801,123

Accrued Expenses

511,010

417,996

Accrued Interest Payable

112,283

146,230

Note Payable to Stockholder

1,424,941

1,424,941

Income Taxes Payable

168

168

Total Current Liabilities

3,974,229

3,790,458

Convertible Subordinated Debt

4,000,000

4,000,000

7,974,229

7,790,458

COMMITMENTS AND CONTINGENCIES

Stockholders’ Equity:

Preferred Stock, $.0001 Par Value:

Authorized Shares – 5,000,000; None Issued and Outstanding

Common stock, $.001 par value,

Authorized Shares – 100,000,000; Issued and

Outstanding – 31,163,120 and 31,138,120, Respectively

31,163

31,138

Additional Paid-in Capital

77,396,865

77,101,690

Accumulated Deficit

(76,201,129)

(74,698,211)

1,226,899

2,434,617

$

9,201,128

$

10,225,075

DYADIC INTERNATIONAL CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended March 31,

2011

2010

Operating Activities

(Unaudited)

(Unaudited)

Net (Loss)

$

(1,502,918)

$

(1,113,790)

Adjustments to Reconcile Net (Loss) to Net Cash (Used in) Operating Activities:

Depreciation and Amortization of Fixed Assets

70,532

71,712

Amortization of Intangible and Other Assets

7,490

3,515

Provision for Doubtful Accounts

11,839

Recovery of Inventory Reserve

(75,389)

(97,713)

Compensation Expense on Stock Option Grants

291,450

196,102

Stock Issued for Financial Services

63,000

Gain on Reduction of Accrued Stockholder Litigation

(410,000)

Changes in Operating Assets and Liabilities:

Accounts Receivable

(252,422)

5,049

Inventory

26,633

450,985

Prepaid Expenses and Other Current Assets

(110,852)

34,504

Other Assets

(12,588)

Accounts Payable

124,704

47,084

Accrued Expenses

93,014

(101,563)

Accrued Interest Payable

(33,947)

(26,459)

Deferred Research and Development Obligation

90,614

Income Taxes Payable

(767)

Net Cash (Used In) Operating Activities

(1,349,866)

(800,315)

Investing Activities

Purchases of Fixed Assets

(104,622)

Cost of Patents

(51,122)

Restricted Cash

(16,852)

(1,429)

Net Cash (Used In) Investing Activities

(67,974)

(106,051)

Financing Activities

Proceeds from Stock Option Exercises

3,750

15,093

Proceeds from Stock Warrant Exercises

16,876

Net Cash Provided by Financing Activities

3,750

31,969

Net (Decrease) in Cash and Cash Equivalents

(1,414,090)

(874,397)

Cash and Cash Equivalents at Beginning of Period

4,535,279

8,419,934

Cash and Cash Equivalents at End of Period

$

3,121,189

$

7,545,537

Supplemental Cash Flow Information:

Cash Paid for Interest

$

146,953

$

59,838

CONTACT:

Dyadic International, Inc.

Michael J. Faby

Vice President Finance

Phone: 561-743-8333

Email: mfaby@dyadic.com