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THE absence of a lump sum licensing payment has led Biosensors International Group to post a lower first-quarter net profit of US$4.2 million, down from US$16.5 million in the same period last year.
But the heart stent company is not wavering on its goal of achieving profitability in the current financial year ending March next year, and has projected an annual revenue of US$90-100 million, driven largely by the sale of its drug-eluting stents.
'We remain committed to our core goals and milestones for fiscal 2010,' said president and CEO Mike Kleine. 'We are striving for continued sales and clinical trial success with (flagship product) BioMatrix, increasing profitability through growth and cost management, introducing new products, advancing the R&D pipeline and participating in China's explosive growth through JWMS (JW Medical Systems).'
JWMS is a 50 per cent-owned subsidiary with extensive distribution networks in China. The Chinese stent company contributed US$3.1 million to Biosensors' bottomline, more than double the US$1.5 million it brought in last year.
For the first quarter ended June 2009, Biosensors reported a 59 per cent fall in revenue to US$23.8 million. A non-recurring $40 million payment from Terumo Corp last year in exchange for future reduced revenue-sharing provision had boosted the topline previously.
Product revenue, however, rose 31 per cent to US$22.4 million. Cost of sales fell 14 per cent to US$6.9 million. Total operating expenses also fell 26 per cent to US$14.4 million, mostly due to a 50 per cent drop in R&D expenses to US$3.6 million.
As at June 30, the group has an unsecured debt of US$47.5 million, largely arising from a US$30 million convertible bond issued in 2006 and due in November this year. Its cash and cash equivalents of US$59 million could cover the outstanding debt and interest, but the group said additional financing plans are in progress and will be completed by end-September.
Earnings per share fell to 0.40 US cent, from 1.56 US cents. Net asset value rose to 10.49 US cents, from 9.81 US cents in end-March.
The group said that its drug eluting stent business will be the main growth driver, while slower growth may be expected for other interventional cardiology products and flat sales likely for its critical care business.
'As product sales and licensing revenues continue to grow and restructuring efforts are completed, the company believes that it will be profitable on an overall basis for the fiscal year ending 31 March 2010, with operating results improving over the course of the year,' it said.
Shares of Biosensors closed 1 cent higher at 55.5 cents yesterday.
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