U.S. FORE-SIGHT sales increased 18% in Q4 on
record 80 placements
CAS Medical Systems, Inc. (NASDAQ:CASM) (CASMED),
a leader in medical products for non-invasive patient monitoring of
tissue oxygenation, today reported financial results for the three
and 12 months ended December 31, 2017.
Net sales from continuing operations for the
fourth quarter of 2017 were $5.1 million, up 11% from $4.6 million
for the fourth quarter of 2016. The Company incurred a net
loss applicable to common stockholders of $1.9 million, or $0.07
per share, for both periods.
In July 2017, the Company sold its NIBP product
line and has reclassified those results to discontinued operations
for the three and 12 months ended December 31, 2017 and 2016.
Highlights for the fourth quarter of 2017
compared with the fourth quarter of 2016 include the following:
- Total FORE-SIGHT cerebral oximetry sales increased 12% to $5.0
million.
- U.S. FORE-SIGHT cerebral oximetry sales increased 18% to $4.3
million.
- Total FORE-SIGHT sensor sales increased 7%, and U.S. FORE-SIGHT
sensor sales increased 8%.
- A net 110 FORE-SIGHT cerebral oximeters were shipped worldwide.
A record net 80 monitors shipped in the U.S., bringing the
installed base of U.S. monitors to 1,318, as of December 31, 2017,
up 18% from the prior year.
- The Company’s year-end cash balance plus cash available under
its line of credit was $7.5 million.
Management Commentary
“We finished 2017 with a strong quarter that
featured an 18% increase in U.S. FORE-SIGHT sales and a record 80
domestic monitors shipped,” said Thomas M. Patton, President and
Chief Executive Officer of CASMED. “Our domestic growth was
driven by higher productivity from our upgraded sales organization,
as our newer sales representatives gained tenure.
Additionally, the IDN and GPO initiatives we implemented are
proving effective in both retaining customers and winning new
accounts. Importantly, we continue to benefit from the
superiority of our FORE-SIGHT technology and its best-in-class
cerebral oximetry measurements and gained a record 22 new accounts
in the quarter, with most coming from competitive wins. In
fact, over the past 12 months, approximately two-thirds of our new
accounts have followed competitive head-to-head clinical
evaluations.
“I’m pleased to report that the momentum we
experienced in late 2017 in our U.S. FORE-SIGHT business has
continued into this year, giving us confidence in achieving the
2018 financial outlook we introduced in January,” he added.
“Our expectations continue to be for U.S. FORE-SIGHT sales for 2018
to increase in the low-teen percentages, driven by a mid-teens
percentage growth in domestic sensor sales, with international
sales expected to decline slightly, resulting in 2018 total
FORE-SIGHT revenues increasing in the low double-digits over the
prior year.”
Fourth-Quarter Financial
Results
Net sales from continuing operations for the
fourth quarter of 2017 increased 11% to $5.1 million from $4.6
million for the fourth quarter of 2016. Total FORE-SIGHT oximetry
sales for the fourth quarter of 2017 increased 12% to $5.0 million
from $4.5 million in the prior-year period, and total FORE-SIGHT
disposable sensor sales for the fourth quarter of 2017 increased 7%
to $4.3 million from $4.0 million. U.S. FORE-SIGHT sales for
the fourth quarter of 2017 increased 18% to $4.3 million from $3.7
million, and U.S. FORE-SIGHT disposable sensor sales for the fourth
quarter increased 8% to $3.8 million from $3.5 million.
International FORE-SIGHT sales for the fourth quarter of 2017 were
$0.7 million versus $0.8 million for the fourth quarter of
2016.
The operating loss for the fourth quarter of
2017 was $1.2 million, an improvement of $0.3 million from an
operating loss of $1.5 million for the fourth quarter of
2016. Higher sales and lower operating expenses were
responsible for the improvement. Operating expenses for the fourth
quarter of 2017 decreased 6% to $4.0 million from $4.2 million in
the prior-year period. Gross profit margin for the fourth
quarter of 2017 was 53.8%, compared with 60.0% for the prior-year
period, largely due to the unfavorable product mix from increasing
levels of monitor sales at lower profit margins consistent with the
Company’s strategy to consign fewer monitors.
Full-Year Financial Results
Net sales from continuing operations of $18.8
million for 2017 finished slightly ahead of the $18.7 million
recorded for 2016. Total FORE-SIGHT oximetry sales for 2017
increased less than 1% to $18.1 million from $18.0 million for
2016, and total FORE-SIGHT disposable sensor sales for 2017 were up
3% to $16.4 million from $15.9 million for the prior year.
U.S. FORE-SIGHT sales for 2017 increased 5% to $15.5 million from
$14.7 million in 2016, and U.S. FORE-SIGHT disposable sensor sales
for 2017 increased 3% to $14.3 million from $13.8 million.
International FORE-SIGHT sales for 2017 were $2.6 million, compared
with $3.3 million for 2016, generally reflecting lower sales of
monitors to a large distributor in Asia.
The operating loss for 2017 was $6.4 million,
compared with an operating loss of $6.3 million for 2016, with the
slight increase due primarily to higher cost of sales, partially
offset by a 1% reduction in operating expenses. Gross profit margin
was 54.7% for 2017, compared with 56.2% for 2016, primarily due to
lower monitor pricing.
Cash, cash equivalents, and available borrowings
under the line-of-credit were $7.5 million as of December 31,
2017.
Conference Call Information
CASMED will host a conference call beginning at
10:00 a.m. Eastern time today to discuss these results and answer
questions. Conference call dial-in information is as follows:
- U.S. callers: (866) 239-5859
- International callers: (702) 495-1913
Individuals interested in listening to the live
conference call via the Internet may do so by logging on to the
Company's website at http://corporate.casmed.com/.
A telephone replay will be available from 1:00
p.m. Eastern time on March 14, 2018, through 11:59 p.m. Eastern
Time on March 28, 2018. Replay dial-in information is as
follows:
- U.S. callers: (855) 859-2056
- International callers: (404) 537-3406
- Conference ID number (U.S. and international callers):
4797418
- The replay will also be available at www.casmed.com.
About CASMED® –
Monitoring What's Vital
CASMED’s vision is that “No patient is harmed
from undetected tissue hypoxia.” Our FORE-SIGHT® Cerebral
Oximeters provide a highly accurate, non-invasive measurement of
tissue oxygenation in the brain. Direct monitoring of tissue
oxygenation can provide clinicians with a superior and powerful
tool to alert them to otherwise unrecognized and dangerous hypoxia,
or low levels of oxygen, in the brain and other tissue, thereby
empowering them to improve patient care. For further
information regarding CASMED, visit the Company's website at
www.FORE-SIGHT.com.
Statements included in this press release, which
are not historical in nature, are forward-looking statements made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Statements relating to the future
performance of the Company are subject to many factors including,
but not limited to, the customer acceptance of the products in the
market, the introduction of competitive products and product
development, the impact of any product liability or other adverse
litigation, working capital and availability of capital,
commercialization and technological difficulties, the impact of
actions and events involving key customers, vendors, lenders,
competitors, and other risks detailed in the Company’s Form 10-K
for the year ended December 31, 2016, and other subsequent
Securities and Exchange Commission filings.
Such statements are based upon the current
beliefs and expectations of the Company’s management and are
subject to significant risks and uncertainties. Actual results may
differ from those set forth in the forward-looking statements. When
used in this press release, the terms "anticipate", "believe",
"estimate", "expect", “guidance”, "may", "objective", "plan",
"possible", "potential", "project", "will”, and similar expressions
identify forward-looking statements. The forward-looking statements
contained in this press release are made as of the date hereof, and
we do not undertake any obligation to update any forward-looking
statements, whether as a result of future events, new information,
or otherwise.
Company
Contact CAS Medical Systems, Inc. Jeffery A. BairdChief
Financial Officer (203) 315-6303ir@casmed.com
InvestorsLHA Investor RelationsBruce Voss / Jody
Cain(310) 691-7100bvoss@lhai.comjcain@lhai.com |
|
(Tables to follow)
CAS MEDICAL SYSTEMS, INC. |
STATEMENTS OF OPERATIONS |
Unaudited |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
Dec. 31, 2017 |
|
Dec. 31, 2016 |
|
Dec. 31, 2017 |
|
Dec. 31, 2016 |
|
|
|
|
|
|
|
|
|
|
Net sales from
continuing operations |
$ |
5,121,475 |
|
|
$ |
4,596,813 |
|
|
$ |
18,763,136 |
|
|
$ |
18,674,146 |
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
2,367,512 |
|
|
|
1,839,878 |
|
|
|
8,505,010 |
|
|
|
8,175,487 |
|
|
Gross profit |
|
2,753,963 |
|
|
|
2,756,935 |
|
|
|
10,258,126 |
|
|
|
10,498,659 |
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research and
development |
|
785,362 |
|
|
|
722,987 |
|
|
|
3,234,101 |
|
|
|
3,272,718 |
|
|
Selling, general
and administrative |
|
3,207,718 |
|
|
|
3,517,890 |
|
|
|
13,418,332 |
|
|
|
13,569,939 |
|
|
Total operating
expenses |
|
3,993,080 |
|
|
|
4,240,877 |
|
|
|
16,652,433 |
|
|
|
16,842,657 |
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
(1,239,117 |
) |
|
|
(1,483,942 |
) |
|
|
(6,394,307 |
) |
|
|
(6,343,998 |
) |
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
277,470 |
|
|
|
262,763 |
|
|
|
1,076,913 |
|
|
|
1,048,207 |
|
|
Other
income |
|
(127 |
) |
|
|
(8,949 |
) |
|
|
(513 |
) |
|
|
(42,522 |
) |
|
Loss from continuing
operations before income taxes |
|
(1,516,460 |
) |
|
|
(1,737,756 |
) |
|
|
(7,470,707 |
) |
|
|
(7,349,683 |
) |
|
Income tax
expense (benefit) |
|
37,336 |
|
|
|
18,692 |
|
|
|
(1,745,441 |
) |
|
|
(1,424,067 |
) |
|
Loss from continuing
operations |
|
(1,553,796 |
) |
|
|
(1,756,448 |
) |
|
|
(5,725,266 |
) |
|
|
(5,925,616 |
) |
|
Discontinued
operations: |
|
|
|
|
|
|
|
|
Income from
discontinued operations |
|
40,000 |
|
|
|
206,310 |
|
|
|
745,396 |
|
|
|
1,277,415 |
|
|
(Loss) gain on
sale of discontinued operations |
|
- |
|
|
|
(25,049 |
) |
|
|
4,388,254 |
|
|
|
2,911,016 |
|
|
Income tax
(benefit) expense |
|
(37,336 |
) |
|
|
(18,692 |
) |
|
|
1,745,441 |
|
|
|
1,424,067 |
|
|
Income from
discontinued operations |
|
77,336 |
|
|
|
199,953 |
|
|
|
3,388,209 |
|
|
|
2,764,364 |
|
|
Net loss |
|
(1,476,460 |
) |
|
|
(1,556,495 |
) |
|
|
(2,337,057 |
) |
|
|
(3,161,252 |
) |
|
Preferred stock
dividend accretion |
|
407,681 |
|
|
|
380,350 |
|
|
|
1,589,134 |
|
|
|
1,482,595 |
|
|
Net loss applicable to
common stockholders |
$ |
(1,884,141 |
) |
|
$ |
(1,936,845 |
) |
|
$ |
(3,926,191 |
) |
|
$ |
(4,643,847 |
) |
|
|
|
|
|
|
|
|
|
|
Loss per common share
from continuing |
|
|
|
|
|
|
|
|
operations -
basic and diluted |
$ |
(0.07 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.27 |
) |
|
$ |
(0.28 |
) |
|
|
|
|
|
|
|
|
|
|
Income per common share
from discontinued |
|
|
|
|
|
|
|
|
operations -
basic and diluted |
$ |
0.00 |
|
|
$ |
0.01 |
|
|
$ |
0.13 |
|
|
$ |
0.11 |
|
|
|
|
|
|
|
|
|
|
|
Per share basic and
diluted net loss applicable |
|
|
|
|
|
|
|
|
to common
stockholders: |
$ |
(0.07 |
) |
|
$ |
(0.07 |
) |
|
$ |
(0.14 |
) |
|
$ |
(0.17 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted-average number
of common |
|
|
|
|
|
|
|
|
shares
outstanding: |
|
|
|
|
|
|
|
|
Basic and
diluted |
|
27,351,338 |
|
|
|
26,849,344 |
|
|
|
27,260,688 |
|
|
|
26,826,792 |
|
|
CAS MEDICAL SYSTEMS, INC. |
BALANCE SHEETS |
Unaudited |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
December 31, |
|
|
|
|
|
2017 |
|
|
2016 |
|
|
|
|
|
|
|
Cash and
cash equivalents |
$ |
5,652,996 |
|
|
$ |
5,488,706 |
|
|
Accounts
receivable |
|
|
2,918,950 |
|
|
|
2,958,551 |
|
|
Notes and
other receivables |
|
15,012 |
|
|
|
557,217 |
|
|
Inventories |
|
|
1,076,261 |
|
|
|
1,373,864 |
|
|
Other
current assets |
|
|
338,067 |
|
|
|
322,148 |
|
|
Assets
associated with discontinued operations |
|
- |
|
|
|
675,019 |
|
|
Total current assets |
|
|
10,001,286 |
|
|
|
11,375,505 |
|
|
|
|
|
|
|
|
|
Property
and equipment |
|
8,251,236 |
|
|
|
8,743,011 |
|
|
Less
accumulated depreciation |
|
(6,080,350 |
) |
|
|
(6,182,586 |
) |
|
|
|
|
|
2,170,886 |
|
|
|
2,560,425 |
|
|
|
|
|
|
|
|
|
Intangible
and other assets, net |
|
802,391 |
|
|
|
788,036 |
|
|
Total assets |
|
$ |
12,974,563 |
|
|
$ |
14,723,966 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable |
|
$ |
691,596 |
|
|
$ |
1,027,911 |
|
|
Accrued
expenses |
|
|
1,651,873 |
|
|
|
2,201,965 |
|
|
Notes
payable |
|
|
86,079 |
|
|
|
70,015 |
|
|
Current
portion of long-term debt, less unamortized debt issuance
costs |
|
2,733,831 |
|
|
|
840,471 |
|
|
Liabilities
associated with discontinued operations |
|
35,000 |
|
|
|
177,990 |
|
|
Total current liabilities |
|
5,198,379 |
|
|
|
4,318,352 |
|
|
|
|
|
|
|
|
|
Deferred
gain on sale and leaseback of property |
|
- |
|
|
|
91,603 |
|
|
Long-term
debt, less current portion, less unamortized debt issuance
costs |
|
4,943,195 |
|
|
|
6,580,851 |
|
|
Other
long-term liabilities |
|
320,000 |
|
|
|
320,000 |
|
|
Total liabilities |
|
|
10,461,574 |
|
|
|
11,310,806 |
|
|
|
|
|
|
|
|
|
Series A
convertible preferred stock |
|
8,802,000 |
|
|
|
8,802,000 |
|
|
Series A
exchangeable preferred stock |
|
5,135,640 |
|
|
|
5,135,640 |
|
|
Common
stock |
|
|
114,487 |
|
|
|
109,715 |
|
|
Additional
paid-in capital |
|
31,989,207 |
|
|
|
30,557,093 |
|
|
Treasury
stock |
|
|
(101,480 |
) |
|
|
(101,480 |
) |
|
Accumulated
deficit |
|
|
(43,426,865 |
) |
|
|
(41,089,808 |
) |
|
Total stockholders' equity |
|
2,512,989 |
|
|
|
3,413,160 |
|
|
|
|
|
|
|
|
|
Total liabilities & stockholders' equity |
$ |
12,974,563 |
|
|
$ |
14,723,966 |
|
|
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