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8-K - FORM 8-K - Cardiogenesis Corp /CA | a54342e8vk.htm |
EX-99.2 - EX-99.2 - Cardiogenesis Corp /CA | a54342exv99w2.htm |
Exhibit 99.1
NEWS RELEASE for November 10, 2009 AT 4:10 PM ET
Contact: William R. Abbott
Senior Vice President and Chief Financial Officer
949-420-1800
Contact: William R. Abbott
Senior Vice President and Chief Financial Officer
949-420-1800
CARDIOGENESIS REPORTS THIRD QUARTER 2009 RESULTS
IRVINE, CA, November 10, 2009
Cardiogenesis Corporation (Pink Sheets: CGCP), a leading developer of surgical products used
in the treatment of patients suffering from severe angina, today reported financial results for its
third quarter ended September 30, 2009.
Net revenues in the third quarter of 2009 totaled $2,134,000 an 18% decrease from prior year
third quarter net revenues of $2,618,000. The decrease in sales was primarily attributed to the
absence of laser sales during the three month period ended September 30, 2009 as compared to laser
sales of $373,000 for the three months ended September 30, 2008.
Net revenues in the first nine months of 2009 totaled $7,222,000, a 26% decrease from net
revenues of $9,719,000 in the first nine months of 2008. Laser sales decreased $1,832,000 and
handpiece sales decreased $786,000 as compared to the prior year nine month period.
We continue to make progress in our efforts to re-engage the cardiology community and to
refocus our sales force on utilization of previously installed lasers. We are taking the right
steps to increase our core TMR business, said Paul McCormick, Executive Chairman. He continued,
At the same time we are stepping up our investment in research and development as we prepare to
initiate a U.S. clinical trial for our PHOENIX Combination Delivery System, which permits the
intramyocardial delivery of both TMR and stem cells. Based upon our recent meeting with the FDA we
expect to make our IDE submission by the end of the year.
The Company reported a third quarter 2009 operating loss of $718,000 as compared with an
operating loss of $310,000 in the prior year quarter. The net loss for the quarter was $739,000 or
$0.02 per basic and diluted share, as compared with net loss of $308,000, or $0.01 per basic and
diluted share in the 2008 third quarter.
For the first nine months of 2009, Cardiogenesis reported an operating loss of $1,577,000 as
compared with operating income of $235,000 for the same period in 2008. The net loss for the first
nine months of 2009 was $1,643,000 or $0.04 per basic and diluted share, compared with net income
of $258,000, or $0.01 per basic and diluted share, for the first nine months of 2008.
Gross margin was 82% of net revenues for the quarters ended September 30, 2009 and 2008.
Gross profit decreased by $390,000 to $1,754,000 for the current year third quarter as
compared with $2,144,000 for the 2008 third quarter.
For the nine months ended September 30, 2009, gross margin was 82% of net revenues as compared
to 84% for the nine months ended September 30, 2008. Gross profit in absolute dollars decreased by
$2,215,000 to $5,915,000 for the nine months ended September 30, 2009, as compared to $8,130,000
for the nine months ended September 30, 2008. The decrease in the gross margin percentage for the
three
months
and nine month periods was primarily attributed to a decrease in laser sales.
Research and development expenses were $379,000 in the third quarter of 2009 as compared with
$165,000 in the 2008 third quarter. Year to date, R&D expenses of $1,013,000 were $380,000 or 60%
above the prior year period of $633,000. The dollar increase for the
three month and nine month
periods are primarily attributed to regulatory expenses incurred for FDA submissions.
Sales and marketing expenses of $1,363,000 in the quarter ended September 30, 2009 decreased
$173,000, or 11%, compared with $1,536,000 for the quarter ended September 30, 2008. For the nine
months ended September 30, 2009, sales and marketing expenditures totaled $4,104,000, a decrease of
$754,000, or 16%, compared with $4,858,000 for the nine months ended September 30, 2008. The
decrease in sales and marketing expenditures for both the third quarter and nine month periods
ended September 30, 2009 as compared to the corresponding prior year periods, was primarily due to
lower commissions and related employee expenses. In addition, travel expenses for the nine months
ended September 30, 2009 were $151,000 lower than the first nine months of 2008.
General and administrative expenses for the quarter ended September 30, 2009 totaled $730,000
as compared to $753,000 during the quarter ended September 30, 2008. For the nine months ended
September 30, 2009, general and administrative expenses totaled $2,375,000 as compared to
$2,404,000 for the nine months ended September 30, 2008.
About Cardiogenesis Corporation
Cardiogenesis is a medical device company specializing in the treatment of cardiovascular disease
and is a leader in devices that treat severe angina. Our market leading holmium:YAG laser system
and single use fiber-optic delivery systems are used to perform a FDA-cleared surgical procedure
known as Transmyocardial Revascularization (TMR).
For more information on Cardiogenesis and its products, please visit our website at
http://www.cardiogenesis.com or the direct to patient website at http://www.heartofnewlife.com.
Safe Harbor Statement
This press release contains forward-looking statements, including, without limitation, with respect
to the Companys expectation to file an IDE for the Companys PHOENIX Combination Delivery System.
Any forward-looking statements in this news release are subject
to numerous risks and uncertainties, many of which are outside the Companys control, that could
cause actual results to differ materially. Factors that could affect the accuracy of these
forward-looking statements include, but are not limited to: any inability by the Company to sustain
profitable operations or obtain additional financing on favorable terms if and when needed; any
failure to obtain required regulatory approvals; failure of the medical community to expand its
acceptance of TMR procedures; possible adverse governmental rulings or regulations, including any
FDA regulations or rulings; the Companys ability to comply with international and domestic
regulatory requirements; possible adverse Medicare or other third-party reimbursement policies or
adverse changes in those policies; any inability by the Company to ship product on a timely basis;
the Companys ability to manage its growth; the effects of recent disruptions in global credit and
equity markets and other adverse economic developments that could adversely affect the market for
our products or our ability to raise needed financing; actions by our competitors; and the
Companys ability to protect its intellectual property. Other factors that could cause
Cardiogenesis actual results to differ materially are discussed in the Risk Factors section of
the Companys Annual Report on Form 10-K for the year ended December 31, 2008 and the Companys
other filings with the Securities and Exchange Commission. The Company disclaims any obligation to
update any forward-looking statements as a result of developments occurring after the date of this
press release.
CARDIOGENESIS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per share amounts)
(unaudited)
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three months ended | Nine months ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net revenues |
$ | 2,134 | $ | 2,618 | $ | 7,222 | $ | 9,719 | ||||||||
Cost of revenues |
380 | 474 | 1,307 | 1,589 | ||||||||||||
Gross profit |
1,754 | 2,144 | 5,915 | 8,130 | ||||||||||||
Operating expenses: |
||||||||||||||||
Research and development |
379 | 165 | 1,013 | 633 | ||||||||||||
Sales and marketing |
1,363 | 1,536 | 4,104 | 4,858 | ||||||||||||
General and administrative |
730 | 753 | 2,375 | 2,404 | ||||||||||||
Total operating expenses |
2,472 | 2,454 | 7,492 | 7,895 | ||||||||||||
Operating income (loss) |
(718 | ) | (310 | ) | (1,577 | ) | 235 | |||||||||
Other income (expense): |
||||||||||||||||
Interest expense |
(4 | ) | (1 | ) | (35 | ) | (22 | ) | ||||||||
Interest income |
1 | 13 | 3 | 55 | ||||||||||||
Other non-operating expense |
(20 | ) | | (20 | ) | | ||||||||||
Total other income (expense), net |
(23 | ) | 12 | (52 | ) | 33 | ||||||||||
Income (loss) before income taxes |
(741 | ) | (298 | ) | (1,629 | ) | 268 | |||||||||
Provision for income taxes |
(2 | ) | 10 | 14 | 10 | |||||||||||
Net income (loss) |
(739 | ) | (308 | ) | (1,643 | ) | 258 | |||||||||
Net earnings (loss) per share: |
||||||||||||||||
Basic |
$ | (0.02 | ) | $ | (0.01 | ) | $ | (0.04 | ) | $ | 0.01 | |||||
Diluted |
$ | (0.02 | ) | $ | (0.01 | ) | $ | (0.04 | ) | $ | 0.01 | |||||
Weighted average shares outstanding: |
||||||||||||||||
Basic |
45,549 | 45,292 | 45,519 | 45,292 | ||||||||||||
Diluted |
45,549 | 45,292 | 45,519 | 45,328 | ||||||||||||
CARDIOGENESIS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
September 30, | December 31, | |||||||
2009 | 2008 | |||||||
(unaudited) | (audited) | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 2,517 | $ | 2,907 | ||||
Accounts receivable, net of allowance for doubtful accounts of $7
and $20, respectively |
941 | 1,330 | ||||||
Inventories |
984 | 1,164 | ||||||
Investments in marketable securities |
| 75 | ||||||
Prepaids and other current assets |
356 | 395 | ||||||
Total current assets |
4,798 | 5,871 | ||||||
Property and equipment, net |
350 | 382 | ||||||
Other assets, net |
18 | 18 | ||||||
Total assets |
$ | 5,166 | $ | 6,271 | ||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 338 | $ | 200 | ||||
Accrued liabilities |
1,020 | 1,103 | ||||||
Deferred revenue |
971 | 800 | ||||||
Note payable |
140 | | ||||||
Current portion of capital lease obligations |
9 | 6 | ||||||
Total current liabilities |
2,478 | 2,109 | ||||||
Capital lease obligations, less current portion |
16 | 13 | ||||||
Total liabilities |
2,494 | 2,122 | ||||||
Commitments and Contingencies |
||||||||
Shareholders equity: |
||||||||
Preferred stock: |
||||||||
no par value; 5,000 shares authorized; none issued and outstanding |
| | ||||||
Common stock: |
||||||||
no par value; 75,000 shares authorized; 45,549 and 45,487 shares
issued and outstanding, respectively |
174,165 | 173,999 | ||||||
Accumulated deficit |
(171,493 | ) | (169,850 | ) | ||||
Total shareholders equity |
2,672 | 4,149 | ||||||
Total liabilities and shareholders equity |
$ | 5,166 | $ | 6,271 | ||||