You are here

Spectral Announces Second Quarter Results

TORONTO, Aug. 14, 2018 (GLOBE NEWSWIRE) -- Spectral Medical Inc., (TSX: EDT), a Phase III company developing the first treatment for patients with septic shock guided by a companion diagnostic, today announced its unaudited financial results for the second quarter ended June 30, 2018.

Financial Review

Revenue for the three-months ended June 30, 2018 was $234,000 compared to $1,055,000 for the same period in the preceding year. For the six-months ended June 30, 2018 revenues were $1,397,000 compared to $1,965,000 in the first half of 2017. Royalty revenue from one customer has decreased from $880 (US$659) to $117 (US$91) for the first six months of 2018, due to the expiry of certain patents. All royalty revenue contracts related to the Company’s biological reagents will expire by the end of 2019. The Company is currently in the process of discussing potential technology transfers and other commercial options in respect of the underlying reagents to partially mitigate the short term revenue loss.

Operating costs for the quarter ended June 30, 2018 amounted to $1,744,000 compared to $2,205,000 in 2017. Operating costs for the six-months ended were $3,621,000, a decrease of $487,000 from $4,108,000 for the first six months of 2017. Most of the Company’s expenses are incurred in its Phase III clinical trial and regulatory program and will vary depending on the timing and determination of the regulatory path forward. Apart from clinical trial and regulatory activities, the Company continues to maintain a low cost operating structure for its base business operations.

For the three-months ended June 30, 2018, the Company reported a loss of $1,510,000 ($0.007 per share) compared to a loss of $1,150,000 ($0.006) for the three-months ended June 30, 2017. The loss for the six-months ended June 30, 2018 was $2,224,000 ($0.010 per share) compared to $2,143,000 ($0.010 per share) for the same six-month period in the prior year.

The Company concluded the second quarter of 2018 with cash on hand of $5,222,000 compared to $1,449,000 as of December 31, 2017.

The total number of shares outstanding for the Company was 225,591,183 as at June 30, 2018.

The Company continues to dialogue with the FDA concerning the pathway forward for its targeted therapy for septic shock.

About Spectral

Spectral is a Phase III company seeking U.S. FDA approval for its unique product for the treatment of patients with septic shock, Toraymyxin™ (“PMX”). PMX is a therapeutic hemoperfusion device that removes endotoxin, which can cause sepsis, from the bloodstream and is guided by the Company's Endotoxin Activity Assay (EAA™), the only FDA cleared diagnostic for the risk of developing sepsis.

PMX has been approved for therapeutic use in Japan and Europe, and has been used safely and effectively on more than 150,000 patients to date. In March 2009, Spectral obtained the exclusive development and commercial rights in the U.S. for PMX, and in November 2010, signed an exclusive distribution agreement for this product in Canada. Approximately 350,000 patients are diagnosed with severe sepsis and septic shock in North America each year. Spectral is listed on the Toronto Stock Exchange under the symbol EDT. For more information, please visit www.spectraldx.com

Forward-looking statement

Information in this news release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws. Implicit in this information, particularly in respect of the future outlook of Spectral and anticipated events or results, are assumptions based on beliefs of Spectral's senior management as well as information currently available to it. While these assumptions were considered reasonable by Spectral at the time of preparation, they may prove to be incorrect. Readers are cautioned that actual results are subject to a number of risks and uncertainties, including the availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the ability of Spectral to take advantage of business opportunities in the biomedical industry, the granting of necessary approvals by regulatory authorities as well as general economic, market and business conditions, and could differ materially from what is currently expected.

The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this statement.

 

For further information, please contact:

Paul Walker
President and CEO
Spectral Medical Inc.
416-626-3233 ext. 2100
pwalker@spectraldx.com
Ali Mahdavi
Capital Markets & Investor Relations
416-962-3300
am@spinnakercmi.com
  


Spectral Medical Inc.
Condensed Interim Consolidated Statements of Financial Position
(Unaudited)

(in thousands of Canadian dollars)

 June 30
2018
  December 31
2017
  January 01
2017
 
    Restated   Restated  
 $  $  $ 
      
Assets     
Current assets     
Cash5,222  1,449  5,080 
Trade and other receivables555  881  642 
Inventories232  191  244 
Prepayments and other assets293  73  166 
Contract asset126  -  - 
 6,428  2,594  6,132 
Non-current assets     
Property and equipment504  570  634 
Intangible asset297  309  334 
      
Total assets7,229  3,473  7,100 
      
Liabilities     
Current liabilities     
Trade and other payables611  612  1,112 
Contract liability3  3  6 
Total liabilities614  615  1,118 
      
Equity      
Share capital66,646  63,225  63,084 
Contributed surplus7,981  7,849  7,849 
Share-based compensation5,544  4,914  4,103 
Warrants1,930  132  132 
Deficit(75,486) (73,262) (69,186)
Total equity6,615  2,858  5,982 
      
Total liabilities and equity7,229  3,473  7,100 
         


Spectral Medical Inc.
Condensed Interim Consolidated Statements of Loss and Comprehensive Loss
For the six-months ended June 30, 2018 and 2017
(Unaudited)

(in thousands of Canadian dollars, except for share and per share data)

 Three-months ended
  Six-months ended
 
 2018 2017  2018 2017 
  Restated     Restated  
  $     $ 
      
Revenue234 1,055  1,397 1,965 
      
Expenses     
Changes in inventories of finished goods and work- in-process32 111  56 126 
Inventory write-down38 -  38 - 
Raw materials and consumables used57 59  125 111 
Salaries and benefits739 804  1,904 1,884 
Consulting and professional fees486 884  696 1,204 
Product development66 -  66 50 
Regulatory and investor relations81 65  279 161 
Travel and entertainment34 59  62 145 
Depreciation and amortization58 58  120 112 
Foreign exchange (gain) loss8 31  (22)34 
Other expenses145 134  297 281 
 1,744 2,205  3,621 4,108 
      
Loss and comprehensive loss for the period(1,510)(1,150) (2,224)(2,143)
      
Basic and diluted loss per Share(0.007)(0.006) (0.010)(0.010)
      
Weighted average number of Shares outstanding221,666,203 207,249,708  214,664,360 207,207,879 
          


Spectral Medical Inc.
Condensed Interim Consolidated Statements of Changes in Equity
For the six-months ended June 30, 2018 and 2017
(Unaudited)

(in thousands of Canadian dollars)

 Issued capital Contributed
surplus
 Share-based
compensation
 Warrants Deficit Total equity 
 Number $ $ $ $ $ $ 
Balance, January 1, 2017207,165,587 63,084 7,849 4,103 132 (69,346)5,822 
Change in accounting policies- - - - - 160 160 
Restated equity, January 1, 2017207,165,587 63,084 7,849 4,103 132 (69,186)5,982 
Share options exercised275,000 130 - (53)- - 77 
Loss and comprehensive loss  for the period, restated- - - - - (2,143)(2,143)
Share-based compensation- - - 375 - - 375 
Balance, June 30, 2017207,440,587 63,214 7,849 4,425 132 (71,329)4,291 
Share options exercised18,435 11 - (4)- - 7 
Loss and comprehensive loss  for the period, restated- - - - - (1,933)(1,933)
Share-based compensation- -   493  - 493 
Balance, December 31, 2017207,459,022 63,225 7,849 4,914 132 (73,262)2,858 
          
Balance, January 1, 2018207,459,022 63,225 7,849 4,914 132 (73,262)2,858 
Private placement17,694,661 3,267 - - 1,930 - 5,197 
Share options exercised437,500 154 - (63)- - 91 
Warrant expiry- - 132 - (132)- - 
Loss and comprehensive loss for the period- - - - - (2,224)(2,224)
Share-based compensation- - - 693 - - 693 
Balance, June 30, 2018225,591,183 66,646 7,981 5,544 1,930 (75,486)6,615 
               

 

Spectral Medical Inc.
Condensed Interim Consolidated Statements of Cash Flows
For the six-months ended June 30, 2018 and 2017
(Unaudited)

(in thousands of Canadian dollars)

 2018  2017 
    Restated  
 $  $ 
Cash flow provided by (used in)   
    
Operating activities   
Loss and comprehensive loss for the period(2,224) (2,143)
Adjustments for:   
Depreciation on property and equipment107  100 
Amortization of intangible asset12  12 
Share-based compensation693  375 
Gain on disposal of property and equipment-  (15)
Changes in items of working capital :   
Trade and other receivables326  (311)
Inventories(41) (32)
Prepayments and other assets(220) (82)
Contract asset(126) - 
Trade and other payables(1) (69)
Contract liability-  (4)
Net cash used in operating activities(1,474) (2,169)
    
Investing activities   
Purchase of property and equipment(41) (91)
Proceeds on disposal of property and equipment-  15 
Net cash used in investing activities(41) (76)
    
Financing activities   
Proceeds from private placement5,308  - 
Transaction costs paid(111) - 
Proceeds from Share options exercised91  77 
Net cash provided by financing activities5,288  77 
    
Increase (decrease) in cash3,773  (2,168)
    
Cash, beginning of period1,449  5,080 
Cash, end of period5,222  2,912 

 

 

Tuesday, August 14, 2018 - 08:00