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BSD Medical Announces First Quarter Fiscal 2014 Financial Results

Category: Results of Operations and Corporate Announcements

Thursday, January 9, 2014 7:15 am MST

Dateline:
SALT LAKE CITY

Public Company Information:

NASDAQ:BSDM
US0556621003

 
"Fiscal 2014 has started on a strong note and we are determined to keep the momentum moving toward a successful year"

SALT LAKE CITY--(BUSINESS WIRE)--BSD Medical Corporation (NASDAQ:BSDM) (Company or BSD) (www.BSDMedical.com), a leading provider of medical systems that treat cancer and benign diseases using heat therapy, today reported financial results for its first quarter ended November 30, 2013.

First Quarter 2014 Highlights

  • Total revenues increased 102% to $1.3 million, compared with the first quarter of 2013
  • Total sales backlog of $2.2 million, an increase of 200% over the first quarter of fiscal year 2013
  • Gross margin of 52%, compared to a gross margin of 28% in the first quarter of fiscal 2013
  • Cash and cash equivalents of $7.6 million
  • Accounts receivable of $1.2 million
  • No debt
  • Net loss was $1.5 million, or $0.04 per share, an improvement from the net loss of $2.2 million, or $0.07 per share, for the first quarter of fiscal year 2013

Management Commentary

“We are very encouraged with our significant reduction in net loss, when compared to the first quarter of fiscal 2013,” said Harold Wolcott, President of BSD Medical. “Revenues more than doubled versus the first quarter of fiscal 2013, driven by increasing sales of our MicroThermX® Microwave Ablation products and by the sale of two hyperthermia systems. Our gross margin improved to 52% of total revenue while operating expenses simultaneously decreased, compared to the same quarter in fiscal 2013. This is evidence we are executing our strategy and moving toward our goal of profitability.”

“Sales continue to increase from our exclusive, multi-year, multi-million dollar master distribution agreement with Terumo Europe NV,” he added. “We expect sales from Terumo to continue to grow as Terumo’s distribution expands through greater Europe.”

“The sale of two hyperthermia systems during the quarter is encouraging. Good progress has been made during the past few months toward obtaining regulatory approvals for hyperthermia systems, particularly in Taiwan and South Korea. We believe these approvals will result in additional revenue from hyperthermia sales during the coming quarters of the current fiscal year.”

“Fiscal 2014 has started on a strong note and we are determined to keep the momentum moving toward a successful year,” Mr. Wolcott concluded.

First Quarter 2014 Operating Summary

The Company’s revenues for the first quarter of fiscal year 2014 totaled $1,330,645, a 102% improvement from $659,785 for the first quarter of fiscal year 2013. This increase in revenues was driven primarily by increased sales of MicroThermX® products and the sale of two hyperthermia systems. The Company has a current sales backlog of $2.2 million, primarily due to pending Asian regulatory approvals.

Gross margin was $691,333 or 52% of total revenues for the first quarter, compared to $186,591 or 28% for the same period last year. The improvement in gross margin resulted from increasing sales from all of our product lines, combined with improved manufacturing efficiencies.

Operating expenses declined to $2.2 million during the first quarter of fiscal 2014 from $2.4 million in same period last year. Research and development expenses for the first quarter of fiscal 2014 were $502,757, down 5% from $527,267 in the comparable period last year. Selling, general and administrative expenses for the first quarter of fiscal 2014 were $1.7 million, down 10% from $1.9 million in the same period last year.

Increased sales, improved manufacturing efficiencies and lower operating expenses resulted in a significant reduction in our net loss. The Company reported a net loss of $1.5 million, or $0.04 per share, for the first quarter of fiscal 2014, compared with a net loss of $2.2 million, or $0.07 per share, for the first quarter of fiscal 2013.

About BSD Medical Corporation

BSD Medical Corporation develops, manufactures, markets and services systems to treat cancer and benign diseases using heat therapy delivered using focused microwave energy and radiofrequency (RF). BSD’s product lines include ablation and hyperthermia treatment systems. BSD’s microwave ablation system has been developed as a stand-alone therapy to ablate and destroy soft tissue. The Company has developed extensive intellectual property, multiple products in the market, and well established distribution in the United States, Europe and Asia. BSD’s hyperthermia cancer treatment systems, which have been in use for several years in the United States, Europe and Asia, are used to treat certain tumors with heat (hyperthermia) while increasing the effectiveness of other therapies such as radiation therapy. Certain of the Company’s products have received regulatory approvals in the United States, Europe and China. For further information visit BSD Medical's website at www.BSDMedical.com.

Forward-Looking Statements

Statements contained in this press release that are not historical facts, including statements relating to our 2014 plans, are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to risks and uncertainties detailed in the Company's filings with the Securities and Exchange Commission, including the market demand for our MicroThermX® products and the regulatory requirements we face. These forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update such statements to reflect events or circumstances arising after such date, except as required by law.

 
BSD MEDICAL CORPORATION
Condensed Balance Sheets
(Unaudited)

ASSETS

   

November 30,
2013

   

August 31,
2013

Current assets:   
Cash and cash equivalents$7,580,268$9,450,528

Accounts receivable, net of allowance for doubtful
accounts of $20,000

1,150,206

899,969

Related party trade accounts receivable40,88724,201
Inventories, net2,630,4142,445,770
Other current assets 160,954     200,028 
Total current assets11,562,72913,020,496
 
Property and equipment, net 1,301,535     1,319,880 
 
$12,864,264    $14,340,376 
 
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
Current liabilities:
Accounts payable$511,873$521,417
Accrued liabilities416,040573,880
Customer deposits334,577317,480
Deferred revenue – current portion 707,501     730,593 
Total current liabilities1,969,9912,143,370
 
Deferred revenue – net of current portion 47,014     53,115 
 
Total liabilities 2,017,005     2,196,485 
 
Commitments and contingencies
 
Stockholders’ equity:

Preferred stock, $.001 par value; 10,000,000 shares
authorized, no shares issued and outstanding

-

-

Common stock, $.001 par value, 80,000,000 shares
authorized, 34,006,202 shares issued

34,007

34,007

Additional paid-in capital57,955,28557,739,056
Treasury stock, 24,331 shares at cost(234)(234)
Accumulated deficit (47,141,799)    (45,628,938)
Total stockholders’ equity 10,847,259     12,143,891 
 
$12,864,264    $14,340,376 
 
See accompanying notes to condensed financial statements
 
 
   

BSD MEDICAL CORPORATION

Condensed Statements of Comprehensive Loss

(Unaudited)

 

Three Months Ended
November 30,

2013   2012
Revenues:   
Sales$1,231,559$517,614
Sales to related parties16,68670,271
Equipment rental 82,400     71,900 
 
Total revenues 1,330,645     659,785 
 
Cost of revenues:
Cost of sales628,711408,870
Cost of related party sales7,65461,377
Cost of equipment rental 2,947     2,947 
 
Total cost of revenues 639,312     473,194 
 
Gross margin 691,333     186,591 
 
Operating costs and expenses:
Research and development502,757527,267
Selling, general and administrative 1,704,713     1,889,249 
 
Total operating costs and expenses 2,207,470     2,416,516 
 
Loss from operations (1,516,137)    (2,229,925)
 
Other income (expense):
Interest income6,3239,946
Other income (expense) (3,047)    1,315 
 
Total other income (expense) 3,276     11,261 
 
Loss before income taxes(1,512,861)(2,218,664)
 
Income tax benefit -     - 
 
Net loss and comprehensive loss$(1,512,861)   $(2,218,664)
 
Net loss per common share:
Basic$(0.04)   $(0.07)
Diluted$(0.04)   $(0.07)
 
Weighted average number of shares outstanding:
Basic33,982,00029,778,000
Diluted33,982,00029,778,000
 
 
   

BSD MEDICAL CORPORATION

Condensed Statements of Cash Flows

(Unaudited)

 

Three Months Ended
November 30,

2013   2012
Cash flows from operating activities:   
Net loss$(1,512,861)$(2,218,664)

Adjustments to reconcile net loss to net cash used
in operating activities:

Depreciation and amortization30,12137,272
Stock-based compensation216,229289,912
Decrease (increase) in:
Receivables(266,923)(170,244)
Inventories(184,644)59,899
Other current assets39,074(16,304)
Increase (decrease) in:
Accounts payable(9,544)14,590
Accrued liabilities(157,840)34,756
Customer deposits17,09716,270
Deferred revenue (29,193)    (3,318)
 
Net cash used in operating activities (1,858,484)    (1,955,831)
 
Cash flows from investing activities:
Purchase of property and equipment (11,776)    (4,160)
 
Cash flows from financing activities -     - 
 
Net decrease in cash and cash equivalents(1,870,260)(1,959,991)
Cash and cash equivalents, beginning of period 9,450,528     11,102,508 
 
Cash and cash equivalents, end of period$7,580,268    $9,142,517 

 

Contact:

BSD Medical Corporation
William Barth, 801-972-5555
Fax: 801-972-5930
investor@bsdmc.com