Hamilton Thorne Ltd. (TSX-V: HTL) ("Hamilton Thorne" or the
"Company"), a leading provider of advanced laser systems for the
regenerative medicine, fertility and stem cell research markets,
today reported operational and financial results for the second
quarter and six months year to date ended June 30, 2011.
"Hamilton Thorne's second quarter sales increased 14% over the
prior year, and 27% over the first quarter, as we experienced
growth across all of our product lines. Sales were bolstered by a
strong market adoption of our newly introduced LYKOS™ laser system,
while our Stiletto™ laser continues to open up new and exciting
research areas in the stem cell field," said Meg Spencer, Chief
Executive Officer of Hamilton Thorne Ltd. "The first half of 2011
brought the launch of several exciting products for our Company,
and as we move into the second half of the year, we are excited to
unveil additional products that will help our customers to discover
and develop life-saving treatments for patients."
Second Quarter Highlights
- The Company launched its ground-breaking LYKOS™ laser system
for the clinical and fertility markets during the 27th Annual
Meeting of the European Society of Human Reproduction and
Embryology (ESHRE) in July 2011. The LYKOS™ is a significant
advance in integrated laser optics, providing additional
functionality, improved optics, increased resolution and
compatibility with all major microscope models. The LYKOS™ has been
well received by customers, and has contributed to growth of laser
sales in the second quarter 2011.
- Hamilton Thorne also unveiled an advanced preview of its new
IMSI STRICT™ morphology analysis software at ESHRE 2011. IMSI
STRICT™ is an imaging analysis product that provides fertility
clinicians with the ability to select optimum sperm and thus
improve outcomes during advanced fertility procedures.
Intracytoplasmic morphologically selected sperm injection (IMSI) is
becoming a key procedure to improve outcomes in fertility
treatments, and IMSI STRICT™ will provide scientists and patients
with better solutions for their conception goals.
- Hamilton Thorne continues to advance their collaboration with
ISee3D Inc. to market their unique single camera, single lens,
single chip 3D microscope technology, which is currently under
development. Under this agreement, Hamilton Thorne has exclusive
rights to sell the ISee3D three-dimensional technology with its
lasers within certain cell research and regenerative medical
research markets. The product will support both inverted and
upright configurations, and is expected to be previewed in the fall
of 2011.
- The Company secured a distribution deal with Sutter Instrument
Company, a company focused on delivering premium micro-
manipulation and micro-injection devices to the research market.
The agreement will provide Hamilton Thorne with the opportunity to
sell Sutter's complementary products to the Company's
customers.
Financial Results
All amounts are in US dollars, unless specified otherwise, and
results expressed in accordance with the International Financial
Reporting Standards ("IFRS"), which replaces Canadian Generally
Accepted Accounting Policies ("GAAP") effective January 1, 2010 for
all publicly accountable enterprises in Canada.
For the three months ended June 30, 2011, the Company reported a
total sales increase of 14% to $1,833,242 for the quarter, an
increase of $224,722 from $1,608,520 during the previous year, and
an increase of 27% over the first quarter of 2011. Six months sales
for 2011 of $3,278,655 were up 18%, from sales of $2,789,207 in
2010. This increase was attributable to increased demand for our
existing products and improved budget availability for capital
equipment purchases across all customer types and geographic
regions. The Company's customers in the regenerative medicine field
primarily use the Company's products in research applications.
Gross profit for the quarter increased 16% to $1,172,842 in the
quarter ended June 30, 2011, compared to $1,009,321 in the previous
year and increased to $2,053,372 versus $1,719,522 for the
comparable six month periods. Gross profit as a percentage of sales
were slightly higher at 64.0% for the quarter and 62.6% for the six
months ended June 30, 2011, versus 62.7% and 61.6% for the
comparable periods in 2010, due primarily to product mix and
increased sales spread over a relatively constant overhead
base.
Operating expenses were $1,460,591 and 2,960,476 for the quarter
and six-months ended June 30, 2011, up from $1,332,421 and
$2,543,293 for comparable periods during the previous year. This
increase in operating expenses represents continued strategic
investment in the growth of the Company.
Research and development expenses increased from $228,947 to
$320,281 for the quarter ended June 30, 2012 and from $479,254 to
$619,728 for the six-month period due to continued development of
new products. Sales and marketing expenses increased from $595,107
to $675,063 for the quarter ended June 30, 2012 and from $1,080,794
to $1,309,240 for the six-month period due to the expansion of our
sales and marketing staff, commission expense on higher sales
volume, and increased variable costs of selling.
General and administrative (G&A) expenses decreased from
$508,367 to $465,247. for the quarter ended June 30, 2011 versus
the prior quarter and increased from $983,245 to $1,031,508 for the
six-month period due primarily to increases in staffing, as well as
foreign currency valuation adjustments related to the convertible
debentures issued in August 2010 and March 2011 issued in Canadian
dollars.
Net interest expense increased from $62,165 to $155,489 for the
quarter ended June 30, 2011 and from $132,114 to $282,510 for the
six-month period. The increase was due primarily to the non-cash
interest expense, both coupon and accreted, on the Company's
convertible debentures.
The net loss for the quarter ended June 30, 2011 increased from
$385,265 to $443,328 and from $955,885 to $1,189,614 for the
six-month period of the previous year. The increased loss was due
primarily to the additional investments by the Company in research,
product development, sales and marketing, additional general and
administrative expenses and interest expense, partially offset by
increased gross profit resulting from increased sales.
As of June 30, 2011, the Company had 24,415,157 common shares.
As of June 30, 2011, there were 5,694,440 warrants outstanding to
purchase common shares: 5,500,005, at a price of Cdn $0.60 which
originally were set to expire in April 2011 but were extended by
eighteen months to October 2012; and 194,435 warrants to acquire
one common share at an exercise price of Cdn$0.50, expiring in
August 2012 and March 2013, issued to its financial advisors in
connection with the August 2010 and March 2011 sales of the
convertible debentures.
Stock options issued to employees and directors outstanding at
June 30, 2011 totaled 4,071,480 at exercise prices ranging from Cdn
$0.205 to Cdn $0.7712. Options for 2,357,351 shares are exercisable
as of June 30, 2011. Options expire at varying times from July 2012
through January 2021.
The financial statements are available on www.sedar.com.
About Hamilton Thorne Ltd.
(www.hamiltonthorne.com)
Hamilton Thorne provides novel solutions for Life Science that
reduce cost, increase productivity as much as ten-fold, and enable
research breakthroughs in regenerative medicine, stem cell research
and fertility markets. The Company's new LYKOS™, Staccato™ and
Stiletto™ laser systems offer significant scientific advantages in
the fields of developmental biology, cancer research and advanced
cell biology. Hamilton Thorne's laser products attach to standard
inverted microscopes and operate as robotic micro-surgeons,
enabling a wide array of scientific applications and procedures.
Each member of Hamilton Thorne's family of products serves a
different research purpose. By simply turning the microscope
turret, researchers can have a new world of scientific capabilities
at their fingertips.
Hamilton Thorne's growing customer base includes pharmaceutical
companies, biotechnology companies, fertility clinics, university
research centers, and other commercial and academic research
establishments worldwide. Current customers include world-leading
research labs such as Harvard University, MIT, Yale, McGill
University, DuPont, Monsanto, Charles River Labs, Jackson Labs,
Merck, Novartis, Pfizer, Oxford University, and Cambridge.
Neither the Toronto Venture Exchange, nor its regulation
services provider (as that term is defined in the policies of the
exchange), accepts responsibility for the adequacy or accuracy of
this release.
Certain information in this press release may contain
forward-looking statements. This information is based on current
expectations that are subject to significant risks and
uncertainties that are difficult to predict. Actual results might
differ materially from results suggested in any forward-looking
statements. The Company assumes no obligation to update the
forward-looking statements, or to update the reasons why actual
results could differ from those reflected in the forward-looking
statements unless and until required by securities laws applicable
to the Company. Additional information identifying risks and
uncertainties is contained in filings by the Company with the
Canadian securities regulators, which filings are available at
www.sedar.com.
Hamilton Thorne Ltd.
Consolidated Statements of Financial Position
For the periods ended June 30, 2011 and December 31, 2010
(Expressed in U.S. Dollars - unaudited)
June 30, 2011 December 31, 2010
Assets
Current
Cash and cash equivalents 229,705 714,498
Accounts receivable 986,633 971,406
Inventories 701,286 544,170
Prepaid expenses and other current
assets 99,648 58,241
------------------ ------------------
2,017,272 2,288,315
Property and equipment 195,606 134,662
Other assets 112,996 111,968
------------------ ------------------
Total assets 2,325,874 2,534,945
================== ==================
Liabilities
Current
Accounts payable and accrued
liabilities 1,617,071 1,412,831
Notes payable 107,910 104,460
Capital lease obligations, current 30,621 20,250
Deferred revenue 54,985 91,086
------------------ ------------------
Total current liabilities 1,810,587 1,628,627
Capital lease obligations, non-
current 60,989 37,295
Deferred revenue, long-term 79,486 79,486
Long-term debt 6,793,598 6,121,015
------------------ ------------------
Total liabilities 8,744,660 7,866,423
------------------ ------------------
Shareholders' Equity (Deficiency)
Common shares 24,345,752 24,345,752
Warrants 353,495 349,019
Contributed surplus 705,366 607,535
Accumulated deficit (31,823,399) (30,633,784)
------------------ ------------------
Total Shareholders' equity
(deficiency) (6,418,786) (5,331,478)
------------------ ------------------
Total Liabilities and shareholders'
equity (deficiency) 2,325,874 2,534,945
================== ==================
Hamilton Thorne Ltd.
Consolidated Statements of Operations and Comprehensive Loss
For the three and six months ended June 30, 2011 and 2010
(Expressed in U.S. Dollars - unaudited)
Three Months ended June 30 Six Months ended June 30
2011 2010 2011 2010
Sales 1,833,242 1,608,520 3,278,655 2,789,207
Cost of sales 660,400 599,199 1,225,283 1,069,685
------------ ------------ ----------- -----------
1,172,842 1,009,321 2,053,372 1,719,522
------------ ------------ ----------- -----------
Expenses
Research and
development 320,281 228,947 619,728 479,254
Sales and marketing 675,063 595,107 1,309,240 1,080,794
General and
administrative 465,247 508,367 1,031,508 983,245
------------ ------------ ----------- -----------
Total expenses 1,460,591 1,332,421 2,960,476 2,543,293
------------ ------------ ----------- -----------
Loss from operations (287,749) (323,100) (907,104) (823,771)
Other income (expense)
Interest expense, net,
including accretion (155,489) (62,165) (282,510) (132,114)
------------ ------------ ----------- -----------
Net loss and
comprehensive loss (443,238) (385,265) (1,189,614) (955,885)
============ ============ =========== ===========
Loss per share
Basic $ (0.02) $ (0.02) $ (0.05) $ (0.04)
Diluted $ (0.02) $ (0.02) $ (0.05) $ (0.04)
Weighted average number
of common shares
outstanding
Basic 24,415,157 24,415,157 24,415,157 24,415,157
Diluted 24,415,157 24,415,157 24,415,157 24,415,157
Hamilton Thorne Ltd
Consolidated Statements of Cash Flows
For the three and six months ended June 30, 2011 and 2010
(Expressed in U.S. Dollars - unaudited)
Three Months ended Six Months ended
June 30 June 30
2011 2010 2011 2010
Cash flows from operating
activities
Net loss for the year (443,238) (385,265) (1,189,614) (955,885)
Adjustments to reconcile net
loss to net cash used in
operating activities:
Depreciation and
amortization 14,460 16,164 28,920 31,191
Non-cash interest
expense/accretion 103,897 - 213,271 -
Share-based payments
expense 34,560 61,245 74,310 122,490
Changes in non-cash
operating assets and
liabilities:
Accounts receivable (277,422) (502,981) (15,227) (585,072)
Inventories (79,302) (57,891) (157,116) (57,582)
Prepaid expenses and
other assets (52,200) 12,921 (41,407) 43,475
Other assets 557 - (1,028) (57,000)
Accounts payable and
accrued liabilities 117,014 342,087 116,705 324,455
Deferred revenue (22,067) 127,971 (36,101) 130,888
----------- ----------- ----------- -----------
Net cash flows used in
operating activities (603,741) (385,749) (1,007,287) (1,003,040)
----------- ----------- ----------- -----------
Cash flows from investing
activities
Purchase of capital assets (22,814) (11,101) (43,254) (48,197)
----------- ----------- ----------- -----------
Cash flows from financing
activities
Proceeds from debt 25,585 256,411 600,475 754,454
Costs of private placement
refunded 3,814 - 3,814
Payments on debt (16,564) (553,015) (34,727) (1,056,699)
----------- ----------- ----------- -----------
Net cash flows provided by
(used in) financing
activities 9,021 (292,790) 565,748 (298,431)
----------- ----------- ----------- -----------
Net Increase (decrease) in
cash and cash equivalents (617,534) (689,640) (484,793) (1,349,668)
Cash and cash equivalents,
beginning of period 847,239 696,343 714,498 1,356,371
Cash and cash equivalents,
end of period 229,705 6,703 229,705 6,703
=========== =========== =========== ===========
Supplemental disclosure of
cash flow information:
Cash paid during the period
for:
Interest 70,942 53,058 132,277 107,466
Supplemental disclosure of
non-cash financing
activities:
Equipment acquired under
capital lease 21,436 0 46,619 0
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For more information, please contact: David Wolf
President Hamilton Thorne Ltd. 978-921-2050 Email Contact Lisa
Rivero Director of Corporate Communications Hamilton Thorne Ltd.
978-921-2050 Email Contact
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