TORONTO, Nov. 9 /CNW/ - Spectral Diagnostics Inc. (TSX: SDI), a developer
of rapid diagnostic technologies, reported a consolidated loss for the three
months ended September 30, 2005 of $1.5 million ($0.08 cents per share),
compared to a loss of $1.9 million ($0.11 cents per share) for the same period
last year. The consolidated loss for the six months ended September 30, 2005
was $3.2 million, or $0.17 cents per share, compared to $3.3 million, or $0.19
cents per share, last year.
Sales for the quarter of $2.3 million were slightly lower than last
year's second quarter sales of $2.5 million. For the first six months of
Fiscal 2006 sales were $4.6 million, compared to $5.3 million in the prior
year. Last year's revenues for the six month period included approximately
$0.5 million of instrument sales to launch the EAA(TM) early adopter program.
The continuing strength of the Canadian dollar negatively impacted current
year's sales by approximately $0.3 million. During the second quarter, the
Company continued to closely manage its operating expenses. For the six months
ended September 30, 2005 operating expenses before net research and
development costs were $0.3 million lower than last year.
"Although sales were somewhat lower than in the prior year, we
experienced a significant increase in sales activity towards the end of the
quarter, particularly in the United States market. This trend is expected to
continue into the third quarter," stated Dr. Paul Walker, President & C.E.O.
"For the first time in the last twelve months, the Company achieved quarter
over quarter sales growth for its Cardiac products. The anticipated sales
increase and our cost containment measures should allow us to meet our Fiscal
2006 objective of achieving positive cash flows from our commercial
operations. In addition, placements of the EAA(TM) assay system in major
institutions continue to grow," added Dr. Paul Walker.
Spectral is a developer of innovative technologies for comprehensive
disease management. Spectral provides accurate and timely information to
clinicians enabling the early initiation of appropriate and targeted therapy.
The Company's products include rapid format tests measuring markers of
myocardial infarction (Cardiac STATus), and rapid diagnostics for sepsis (the
Endotoxin Activity Assay). Spectral manufactures all of its products.
Spectral's common shares are listed on The Toronto Stock Exchange: SDI.
These consolidated financial statements are not complete as they exclude
accompanying notes, which are an integral part of the financial statements.
More specifically, they exclude the note on the Company's financial situation
and going concern. The complete audited consolidated financial statements for
the years ended March 31, 2005 and 2004, the second quarter ended
September 30, 2004, as well as additional information and the Management's
Discussion and Analysis of financial condition and results of operations, are
filed with the relevant securities regulatory authorities and are available on
the Spectral website at www.spectraldx.com, and on SEDAR at www.sedar.com.
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 completion of the proposed offering, 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.
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Spectral Diagnostics Inc.
Consolidated Balance Sheets - unaudited
As at September 30, 2005 and March 31, 2005
-------------------------------------------------------------------------
(in thousands of Canadian dollars)
September 30, March 31,
2005 2005
$ $
Assets
Current assets
Cash and cash equivalents 606 1,694
Accounts receivable 2,882 2,760
Inventories 1,455 1,351
Prepaid expenses 177 359
----------- -----------
4,976 6,164
Restricted cash 647 2,013
Capital assets 1,086 1,158
Purchased technology and trademarks 3,021 3,327
Deferred financing costs 658 804
Goodwill 2,114 2,114
----------- -----------
12,646 15,580
----------- -----------
----------- -----------
Liabilities
Current liabilities
Bank indebtedness 675 929
Accounts payable and accrued liabilities 988 1,582
----------- -----------
1,663 2,511
Convertible notes and interest payable 8,822 7,742
----------- -----------
9,885 10,253
----------- -----------
Shareholders' Equity
Common shares 99,446 99,446
Other equity 4,966 4,897
Deficit (102,251) (99,016)
----------- -----------
2,161 5,327
----------- -----------
12,646 15,580
----------- -----------
----------- -----------
Going concern
Spectral Diagnostics Inc.
Consolidated Statements of Operations and Deficit - unaudited
For the three and six month periods ended September 30, 2005 and 2004
-------------------------------------------------------------------------
(in thousands of Canadian dollars, except share and per share data)
3 Months Ended 6 Months Ended
September 30 September 30
2005 2004 2005 2004
$ $ $ $
Sales 2,265 2,486 4,558 5,335
Cost of Sales 1,059 1,003 2,140 2,225
----------- ----------- ----------- -----------
Gross Margin 1,206 1,483 2,418 3,110
----------- ----------- ----------- -----------
Operating expenses
Sales and marketing 1,115 1,184 2,140 2,510
General and administrative 861 726 1,559 1,443
Depreciation and amortization 342 350 700 703
Foreign exchange loss 119 85 79 67
Stock-based compensation 35 145 69 211
Research and product
development 496 575 914 1,082
Government assistance (807) - (932) (200)
----------- ----------- ----------- -----------
2,161 3,065 4,529 5,816
----------- ----------- ----------- -----------
Loss before the following (955) (1,582) (2,111) (2,706)
Interest expense on
convertible notes (540) (300) (1,080) (600)
Other net interest income
(expense) (46) (3) (44) 22
----------- ----------- ----------- -----------
Loss for the period (1,541) (1,885) (3,235) (3,284)
Deficit - Beginning of
period (100,710) (93,057) (99,016) (91,658)
----------- ----------- ----------- -----------
Deficit - End of period (102,251) (94,942) (102,251) (94,942)
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Basic and diluted loss per
common share (0.08) (0.11) (0.17) (0.19)
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Weighted average number
of common shares
outstanding 19,860,168 17,119,145 19,860,168 17,119,145
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Going concern
Spectral Diagnostics Inc.
Consolidated Statements of Cash Flows - unaudited
For the three and six month periods ended September 30, 2005 and 2004
-------------------------------------------------------------------------
(in thousands of Canadian dollars)
3 Months Ended 6 Months Ended
September 30 September 30
2005 2004 2005 2004
$ $ $ $
Cash provided by (used in)
Operating activities
Loss for the period (1,541) (1,885) (3,235) (3,284)
Items not affecting cash
Depreciation and
amortization 342 350 700 703
Stock-based compensation
expense 35 145 69 211
Accrued interest on
convertible notes payable 540 300 1,080 600
Changes in non-cash working
capital (11) (416) (638) (880)
----------- ----------- ----------- -----------
(635) (1,506) (2,024) (2,650)
----------- ----------- ----------- -----------
Financing activities
Bank indebtedness (220) 320 (254) (10)
Restricted cash 657 1,081 1,366 1,655
Net cash proceeds on
issuance of common shares - 20 - 87
----------- ----------- ----------- -----------
437 1,421 1,112 1,732
Investing activities
Purchase of capital assets (107) (112) (176) (298)
----------- ----------- ----------- -----------
Decrease in cash and cash
equivalents during the
period (305) (197) (1,088) (1,216)
----------- ----------- ----------- -----------
Cash and cash equivalents -
Beginning of period 911 1,051 1,694 2,070
----------- ----------- ----------- -----------
Cash and cash equivalents -
End of period 606 854 606 854
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Going concern
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%SEDAR: 00002006E
