|By Marketwired .||
|May 12, 2014 05:00 PM EDT||
VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 05/12/14 -- Response Biomedical Corp. ("Response" or "the Company") (TSX: RBM)(OTCBB: RPBIF) today reported financial results for the first quarter ended March 31, 2014 including gross margin that was essentially unchanged in spite of seasonally lower flu sales and a transition to completely new distribution channels in China, the Company's largest market.
Response's Chief Executive Officer, Jeff Purvin, commented on Response's Q1 2014 performance, saying "Our transition away from our two former distributors to our two new distributors in China, which started late last year, is continuing. Our new distributors purchased approximately $1.5 million in Q1, up 17% from the fourth quarter of 2013 but approximately $600 thousand less than what our previous distributors purchased from us in the comparable quarter in 2013. Our new distributors are now fully trained and are selling to both new and existing customers. As with any new distributors, we believe they will need some time to get accustomed to selling our product. Yet, we are encouraged that they are already demonstrating the ability to find and sell to our previous distributors' hospital customers as well as establishing a base of new customers from which to grow. We expect to add an additional source of increased distribution in China that will target a different tier of hospital than our two new Chinese distributors, further increasing our growth potential in China."
Mr. Purvin added, "Sales in the US were relatively unchanged from the previous year with the exception of Infectious disease sales which decreased by 85%, or $386 thousand, primarily due to a seasonal increase in the demand for Influenza tests during the first quarter of 2013 based on the severity of the 2012 - 2013 Influenza season. Sales in the rest of the world excluding China and the US increased 22% to $824 thousand in the quarter as we continue to strengthen our overseas distribution networks."
"Importantly, we were able to minimize the reduction in our gross margin percentage during the quarter in spite of the reduction in sales. The efficiencies we've achieved in manufacturing and purchasing over the past year have helped to lessen the impact of spreading our overhead over the lower number of units we produced in Q1. More importantly, we anticipate that these efficiencies will benefit the company in the future as our unit sales volumes increase. In addition, we secured a US$2.5 million term loan from Silicon Valley Bank during the quarter to support the investment and working capital necessary to implement our new plans in both China and the United States. All of the changes we are making now will require time to take full effect. But, because of the quality and quantity of the changes we've made, I feel confident that this plan will allow Response Biomedical to accelerate revenue growth and speed our progress toward profitability," concluded Mr. Purvin.
Financial results for the quarter ended March 31, 2014
-- Product sales decreased 39% to $2.56 million for the quarter ended March 31, 2014 compared to $3.56 million for the previous quarter ended March 31, 2013: -- Cardiovascular sales decreased 14%, or $0.41 million, primarily due to reduced sales in China as a result of the transition to new distribution partners which began in the fourth quarter of 2013; and -- Infectious Disease, West Nile Virus and Biodefense sales have decreased 83%, or $0.59 million compared to 2013, primarily due to the seasonal increase in demand for Influenza sales in the first quarter of 2013 and the timing of orders by distributors. -- Gross margin decreased to 43.7% for the quarter ended March 31, 2014, compared to a gross margin of 44.8% in the same quarter of 2013. This slight decrease is primarily due to the following: -- A decrease in the sales of Infectious Disease, West Nile Virus, and Biodefense, which are higher margin products; and -- Numerous manufacturing efficiencies implemented during 2013 along with reduced component material costs by purchasing from more economical suppliers offsetting the impact of spreading our overhead over a smaller number of units and a net increase in inventory provisions during the quarter. -- Operating expenses increased by 22% to $2.27 million for the quarter ended March 31, 2014 compared to $1.86 million in the same period in 2013. The increase is primarily due to investments in research and development for increased clinical and regulatory work in 2014 and an increase in sales and marketing expenses primarily related to expanded staffing. -- As a result of the changes described above, Adjusted EBITDA for the quarter ended March 31, 2014 was negative $0.80 million compared to positive $0.15 million in the same quarter of 2013. Adjusted EBITDA excludes, for the applicable periods, interest expense, interest income, income tax, depreciation and amortization, stock-based compensation expense, and the non-cash unrealized loss on the revaluation of the warrant liability. We believe that this non-GAAP measure may be useful to investors to analyze the results of our business as we use this non- GAAP measure internally to evaluate our financial results. A reconciliation between net loss and comprehensive loss and Adjusted EBITDA is included below. -- GAAP Net loss for the quarter ended March 31, 2014 totaled $1.52 million, or $0.19 per basic and diluted share, compared to a $9.96 million GAAP Net loss, or $1.53 per basic and diluted share, in the comparative 2013 period. The decrease in the loss was primarily due to a $9.32 million decrease in the unrealized loss on revaluation of the warrant liability offset by the decrease in product sales and increase in operating expenses mentioned above. -- Adjusted Net loss increased by $0.97 million to $1.36 million from the $0.40 million Adjusted Net loss in the comparable quarter in 2013. We also believe that this non-GAAP measure, along with Adjusted EBITDA, may be useful to investors to analyze the results of our business because it excludes the often volatile, non-cash unrealized change in the valuation of the Company's warrant liability. A reconciliation between Net loss and comprehensive loss and Adjusted Net loss is included below. -- Cash and cash equivalents as of March 31, 2014 were $4.05 million compared to $2.96 million as of December 31, 2013. During the quarter, the Company received US $1.5 million of the total US $2.5 million term loan from Silicon Valley Bank that it had secured during the quarter.
For a further discussion of the Company's financial results for the quarter ended March 31, 2014, please refer to the Company's consolidated financial statements and related Management Discussion and Analysis, which can be found at www.responsebio.com, SEDAR (Canada) www.sedar.com or EDGAR (U.S.) www.sec.gov/edgar/searchedgar/webusers.htm. Information at these sites is typically available within 24 hours of the distribution of the news release.
Non-GAAP Financial Measures
Management has presented its operating results in accordance with United States Generally Accepted Accounting Principles (GAAP) and on an "adjusted" (or non-GAAP) basis for the quarter ended March 31, 2014 and 2013. We believe that the presentation of non-GAAP financial measures provides useful supplementary information to and facilitates additional analysis by investors. These non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in conformity with GAAP. Further, our reconciliation of GAAP Net loss and comprehensive loss to Adjusted EBITDA and Adjusted Net loss are included in the tables below to facilitate a reader's understanding of the impact of these adjustments to our GAAP financial results and are not intended to place any undue prominence on our Adjusted EBITDA and/or our Adjusted Net loss.
About Response Biomedical Corp.
Response develops, manufactures and markets rapid on-site diagnostic tests for use with its RAMP® Platform for clinical, biodefense and environmental applications. RAMP® represents a unique paradigm in diagnostics that provides reliable, quality results in minutes. The RAMP® Platform consists of a reader and single-use disposable test cartridges and has the potential to be adapted to any other medical and non-medical immunoassay based test currently performed in laboratories. Response clinical tests are commercially available for the aid in early detection of heart attack, congestive heart failure, influenza A and B and RSV. In the non-clinical market, RAMP® tests are currently available for the environmental detection of West Nile Virus and for Biodefense applications including the rapid on-site detection of anthrax, smallpox, ricin and botulinum toxin.
Response is a publicly traded company listed on the TSX under the trading symbol "RBM" and quoted on the OTC Bulletin Board under the symbol "RPBIF". For further information, please visit the Company's website at www.responsebio.com.
This press release may contain forward-looking statements. These statements relate to future events and are subject to risks, uncertainties and assumptions about Response Biomedical Corp. Examples of forward-looking statements in this press release include statements regarding our belief that our new distributors in China will need some time to get accustomed to selling our products and that their demonstrated ability to find and sell to our previous distributors' hospital customers as well as establishing new customers will create a base of from which to grow, our expectation that we will add an additional source of increased distribution in China that will target a different tier of hospital than our two new Chinese distributors, further increasing our growth potential in China, our belief that the efficiencies we have achieved in manufacturing and purchasing over the past year will benefit the Company in the future as our unit sales volumes increase, our expectation that the US$2.5 million term loan from Silicon Valley Bank secured during the quarter will support the investment and working capital necessary to implement our new plans in both China and the United States, our expectation that all of the changes we are making now will require time to take full effect and our belief that the quality and quantity of the changes we've made will allow us to accelerate revenue growth and speed our progress toward profitability. These statements are only predictions based on our current expectations and projections about future events. Although we believe the expectations reflected in such forward-looking statements, and the assumptions upon which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct and if such expectations are not met, our business may suffer.
Readers should not place undue reliance on these statements. Actual events or results may differ materially. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the Company's actual results, events or developments to be materially different from any future results, events or developments expressed or implied by such forward-looking statements. Many factors may cause the Company's actual results to differ materially from any forward-looking statement, including the factors detailed in our filings with the Securities and Exchange Commission and Canadian securities regulatory authorities, including but not limited to our annual report on Form 10-K, our quarterly reports on Form 10-Q, our Current Reports on Form 8-K, our Annual Information Form and other filings with the Securities and Exchange Commission and Canadian securities regulatory authorities.
The forward-looking statements contained in this news release are current as of the date hereof and are qualified in their entirety by this cautionary statement. Except as expressly required by applicable securities laws, we do not undertake any obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
Selected Financial Data (in thousands of Canadian dollars except per share data):
Unaudited For the quarter ended March 31, 2014 2013 ---------------------------------------------------------------------------- Product sales $ 2,559 $ 3,561 Cost of sales 1,440 1,965 ---------------------------------------- Gross profit $ 1,119 $ 1,596 Gross margin on product sales 43.7% 44.8% Operating expenses 2,268 1,864 Other expenses 374 9,696 ---------------------------------------- Net loss and comprehensive loss $ (1,523) $ (9,964) ---------------------------------------- ---------------------------------------- Loss per share - basic and diluted $ (0.19) $ (1.53)
Reconciliation of GAAP Net Loss to Adjusted EBITDA (in thousands of Canadian dollars):
Unaudited For the quarter ended March 31, 2014 2013 ---------------------------------------------------------------------------- Adjusted EBITDA $ (802) $ 151 Interest expense and amortization of deferred financing costs and debt discount 197 177 Interest income (5) (4) Income tax expense 17 - Depreciation and amortization 200 232 Stock-based compensation 151 135 Unrealized loss on revaluation of warrant liability 161 9,575 ---------------------------------------- Net loss and comprehensive loss $ (1,523) $ (9,964) ---------------------------------------- ----------------------------------------
Reconciliation of Adjusted Net Loss to GAAP Net Loss (in thousands of Canadian dollars):
Unaudited For the quarter ended March 31, 2014 2013 ---------------------------------------------------------------------------- Adjusted net loss $ (1,362) $ (389) Unrealized loss on revaluation of warrant liability 161 9,575 ---------------------------------------- Net loss and comprehensive loss $ (1,523) $ (9,964) ---------------------------------------- ----------------------------------------
Response Biomedical Corp.
W.J. (Bill) Adams
Chief Financial Officer
All organizations that did not originate this moment have a pre-existing culture as well as legacy technology and processes that can be more or less amenable to DevOps implementation. That organizational culture is influenced by the personalities and management styles of Executive Management, the wider culture in which the organization is situated, and the personalities of key team members at all levels of the organization. This culture and entrenched interests usually throw a wrench in the work...
Apr. 27, 2017 08:15 PM EDT Reads: 703
SYS-CON Events announced today that CollabNet, a global leader in enterprise software development, release automation and DevOps solutions, will be a Bronze Sponsor of SYS-CON's 20th International Cloud Expo®, taking place from June 6-8, 2017, at the Javits Center in New York City, NY. CollabNet offers a broad range of solutions with the mission of helping modern organizations deliver quality software at speed. The company’s latest innovation, the DevOps Lifecycle Manager (DLM), supports Value S...
Apr. 27, 2017 08:00 PM EDT Reads: 1,112
The Internet of Things is clearly many things: data collection and analytics, wearables, Smart Grids and Smart Cities, the Industrial Internet, and more. Cool platforms like Arduino, Raspberry Pi, Intel's Galileo and Edison, and a diverse world of sensors are making the IoT a great toy box for developers in all these areas. In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists discussed what things are the most important, which will have the most profound e...
Apr. 27, 2017 07:45 PM EDT Reads: 2,298
Multiple data types are pouring into IoT deployments. Data is coming in small packages as well as enormous files and data streams of many sizes. Widespread use of mobile devices adds to the total. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the tools and environments that are being put to use in IoT deployments, as well as the team skills a modern enterprise IT shop needs to keep things running, get a handle on all this data, and deli...
Apr. 27, 2017 07:30 PM EDT Reads: 2,465
Automation is enabling enterprises to design, deploy, and manage more complex, hybrid cloud environments. Yet the people who manage these environments must be trained in and understanding these environments better than ever before. A new era of analytics and cognitive computing is adding intelligence, but also more complexity, to these cloud environments. How smart is your cloud? How smart should it be? In this power panel at 20th Cloud Expo, moderated by Conference Chair Roger Strukhoff, pane...
Apr. 27, 2017 07:30 PM EDT Reads: 2,274
The explosion of new web/cloud/IoT-based applications and the data they generate are transforming our world right before our eyes. In this rush to adopt these new technologies, organizations are often ignoring fundamental questions concerning who owns the data and failing to ask for permission to conduct invasive surveillance of their customers. Organizations that are not transparent about how their systems gather data telemetry without offering shared data ownership risk product rejection, regu...
Apr. 27, 2017 07:15 PM EDT Reads: 1,617
SYS-CON Events announced today that Progress, a global leader in application development, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Enterprises today are rapidly adopting the cloud, while continuing to retain business-critical/sensitive data inside the firewall. This is creating two separate data silos – one inside the firewall and the other outside the firewall. Cloud ISVs oft...
Apr. 27, 2017 07:00 PM EDT Reads: 294
SYS-CON Events announced today that Grape Up will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct. 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Grape Up is a software company specializing in cloud native application development and professional services related to Cloud Foundry PaaS. With five expert teams that operate in various sectors of the market across the U.S. and Europe, Grape Up works with a variety of customers from emergi...
Apr. 27, 2017 06:45 PM EDT Reads: 2,205
The age of Digital Disruption is evolving into the next era – Digital Cohesion, an age in which applications securely self-assemble and deliver predictive services that continuously adapt to user behavior. Information from devices, sensors and applications around us will drive services seamlessly across mobile and fixed devices/infrastructure. This evolution is happening now in software defined services and secure networking. Four key drivers – Performance, Economics, Interoperability and Trust ...
Apr. 27, 2017 06:45 PM EDT Reads: 733
@ThingsExpo has been named the Most Influential ‘Smart Cities - IIoT' Account and @BigDataExpo has been named fourteenth by Right Relevance (RR), which provides curated information and intelligence on approximately 50,000 topics. In addition, Right Relevance provides an Insights offering that combines the above Topics and Influencers information with real time conversations to provide actionable intelligence with visualizations to enable decision making. The Insights service is applicable to eve...
Apr. 27, 2017 06:30 PM EDT Reads: 2,817
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
Apr. 27, 2017 06:00 PM EDT Reads: 1,034
Building a cross-cloud operational model can be a daunting task. Per-cloud silos are not the answer, but neither is a fully generic abstraction plane that strips out capabilities unique to a particular provider. In his session at 20th Cloud Expo, Chris Wolf, VP & Chief Technology Officer, Global Field & Industry at VMware, will discuss how successful organizations approach cloud operations and management, with insights into where operations should be centralized and when it’s best to decentraliz...
Apr. 27, 2017 06:00 PM EDT Reads: 787
Cybersecurity is a critical component of software development in many industries including medical devices. However, code is not always written to be robust or secure from the unknown or the unexpected. This gap can make medical devices susceptible to cybersecurity attacks ranging from compromised personal health information to life-sustaining treatment. In his session at @ThingsExpo, Clark Fortney, Software Engineer at Battelle, will discuss how programming oversight using key methods can incre...
Apr. 27, 2017 05:30 PM EDT Reads: 3,961
The goal of Continuous Testing is to shift testing left to find defects earlier and release software faster. This can be achieved by integrating a set of open source functional and performance testing tools in the early stages of your software delivery lifecycle. There is one process that binds all application delivery stages together into one well-orchestrated machine: Continuous Testing. Continuous Testing is the conveyor belt between the Software Factory and production stages. Artifacts are ...
Apr. 27, 2017 05:15 PM EDT Reads: 1,277
In recent years, containers have taken the world by storm. Companies of all sizes and industries have realized the massive benefits of containers, such as unprecedented mobility, higher hardware utilization, and increased flexibility and agility; however, many containers today are non-persistent. Containers without persistence miss out on many benefits, and in many cases simply pass the responsibility of persistence onto other infrastructure, adding additional complexity.
Apr. 27, 2017 04:30 PM EDT Reads: 2,293