Neovasc Announces Results for the First Quarter of 2017

Contract manufacturing revenues for the three months ended March 31, 2017 were $133,963, compared to $606,783 for the same period in 2016, representing a decrease of 78%.  The decrease in revenue for the three months ended March 31, 2017 compared to the same period in 2016 is primarily due to the loss of Boston Scientific Corporation ("Boston Scientific") as a customer.  In December 2016, the Company entered into an agreement for Boston Scientific to acquire the Company's advanced biologic tissue capabilities and certain manufacturing assets and make a 15% equity investment in Neovasc, for a total of $75 million in cash.  Under the terms of the approximate $68 million asset purchase agreement the Company has been granted a license to the purchased trade secrets and know-how and access to the sold facilities to allow it to continue its tissue and valve assembly activities for its remaining customers, and continue its own tissue-related programs, including advancing the Tiara through its clinical and regulatory pathways.  The Company believes that going forward contract manufacturing revenues will be derived from a smaller customer base as the transcatheter aortic valve market matures.

Revenues from consulting services for the three months ended March 31, 2017 were $1,086,632, compared to $1,186,194 for the same period in 2016, representing a decrease of 8%.  The loss is indicative of the trend the Company is seeing in consulting service revenue.  The Company anticipates that its consulting services revenue will decline in the long-term as its consulting customers continue to transition to becoming contract manufacturing customers or cease to be customers at all.

Cost of Goods Sold
The cost of goods sold for the three months ended March 31, 2017 was $808,628, compared to $1,445,644 for the same period in 2016.  The overall gross margin for the three months ended March 31, 2017 was 45%, compared to 28% gross margin for the same period in 2016.  The Company has seen its gross margins increase due to a change in the product mix as Reducer revenues reflect an increasing proportion of the overall revenues.

Expenses
Total expenses for the three months ended March 31, 2017 were $8,489,404, compared to $10,075,039 for the same period in 2016, representing a decrease of $1,585,635 or 16%.  The decrease in total expenses for the three months ended March 31, 2017 compared to the same period in 2016 reflects a $2,578,692 decrease in general and administrative expenses and a $970,736 increase in product development and clinical trial expenses to advance the Tiara and the Reducer development programs.

Selling expenses for the three months ended March 31, 2017 were $187,168, compared to $164,847 for the same period in 2016, representing an increase of $22,321, or 14%.  The increase in selling expenses for the three months ended March 31, 2017 compared to the same period in 2016 reflects costs incurred for commercialization activities for the Reducer.

General and administrative expenses for the three months ended March 31, 2017 were $3,248,713 compared to $5,827,405 for the same period in 2016, representing a decrease of $2,578,692, or 44%.  The decrease in general and administrative expenses for the three months ended March 31, 2017 compared to the same period in 2016 can be substantially explained by a $3,164,430 decrease in litigation expenses, offset by a $462,676 increase in share-based payments.  Due to certain black-out periods during 2016 the Company was unable to grant annual option grants to directors and officers of the Company.  The 2016 annual awards were granted in 2017.  The charge for 2017 reflects stock-based compensation for both the annual grants for 2016 and 2017.

Product development and clinical trial expenses for the three months ended March 31, 2017 were $5,053,523, compared to $4,082,787 for the same period in 2016, representing an increase of $969,736, or 24%.  The increase in product development and clinical trial expenses for the three months ended March 31, 2017 represented an increased investment in the Tiara development program.

Other Income and Loss
The other loss for the three months ended March 31, 2017 was $28,299, compared to $1,319,023 for the same period in 2016, a decrease of $1,290,724.  Included within other loss is a charge of $211,884 for post-judgment interest on the damages provision related to the litigation with CardiAQ Valve Technologies Inc. ("CardiAQ"), (see "Trends, Risks and Uncertainties" and "Contractual Obligations and Contingencies" in the Company's first quarter Management's Discussion and Analysis).  The decrease in the other loss can be explained by a $52,636 decrease in the loss on foreign exchange and by a $1,505,875 increase in the unrealized gain on the damages provision.

Losses
The operating losses and comprehensive losses for the three months ended March 31, 2017 were $7,844,987 and $7,927,304 respectively, or $0.10 basic and diluted loss per share, as compared with losses of $10,881,138 and $7,677,054, or $0.16 basic and diluted loss per share for the same period in 2016.  The $1,697,269 decrease in the operating loss incurred for the three months ended March 31, 2017 compared to the same period in 2016 can be substantially explained by a $2,578,692 decrease in general and administrative expenses (of which $3,164,430 was a decrease in litigation expense and $462,676 was an increase in stock-based compensation charges) offset by a $970,736 increase in product development and clinical trial expenses.  The Company has incurred significant costs in defending itself in lawsuits filed by CardiAQ.  Total litigation costs since the initial claims were filed in June 2014 are approximately $21.9 million and the Company may require an additional $1 million to cover additional litigation expenses up to and including the appeal hearing, currently scheduled for August 2017.

Discussion of Liquidity and Capital Resources
Neovasc finances its operations and capital expenditures with cash generated from operations and equity financings.  As at March 31, 2017 the Company had cash and cash equivalents of $16,206,632 compared to cash and cash equivalents of $22,954,571 as at December 31, 2016.

Cash used in operating activities for the three months ended March 31, 2017, was $6,308,755, compared to $10,903,712 for the same period in 2016.  For the three months ended March 31, 2017, operating expenses were $6,153,498, compared to $10,256,486 for the same period in 2016.  This can substantially be explained by a decrease in litigation expenses of $3,164,430 offset by an increase in product development and clinical trial expenses of $970,736. 

The Company's working capital deficit is $24,221,853 as at March 31, 2017 compared to a working capital deficit of $17,497,931 as at December 31, 2016.  Unless the Company is successful in an appeal of the verdict in the litigation with CardiAQ, or otherwise is successful in reducing the amount of the approximate $112 million damages award to an amount less than the $70 million held in escrow, the Company will require significant additional financing in order to pay the damages and to continue to operate its business.  There can be no assurance that such financing will be available on favorable terms, or at all.

Going Concern
The Company may be faced with significant monetary damages in the litigation with CardiAQ that could exceed its resources and/or the loss of intellectual property rights that could have a material adverse effect on the Company and its financial condition.  These circumstances indicate the existence of material uncertainty and cast substantial doubt about the Company's ability to continue as a going concern.

Outstanding Share Data
As at May 10, 2017, the Company had 78,897,345 common voting shares issued and outstanding.  Further, the following securities are convertible into common shares of the Company: 9,234,029 stock options with a weighted average price of C$3.57.  The fully diluted share capital of the Company at May 10, 2017 is 88,131,374.

The Company prepares its consolidated financial statements in accordance with International Financial Reporting Standards, as issued by the International Accounting Standards Board.

Neovasc's first quarter 2017 financial statements and notes and its Management's Discussion and Analysis will be posted on the Company's website at www.neovasc.com and will be filed on SEDAR and EDGAR. In addition to the summary contained herein, readers are encouraged to review the full disclosure in Neovasc's first quarter 2017 financial statements and Management's Discussion and Analysis.

Conference Call and Webcast Information
Neovasc will be hosting a conference call today at 4:30 pm ET to discuss these results.  To participate in the conference, dial 888 390 0546 or 416 764 8688.  A recording of the call will be available for 72 hours by calling 888 390 0541 or 416 764 8677 and using passcode 364834#.  A link to the live and archived audio webcast of the conference call will also be available on the Presentations and Events page of the Investors section of Neovasc's website at www.neovasc.com.

NEOVASC INC.
Condensed Interim Consolidated Statements of Financial Position
(Expressed in U.S. dollars) (Unaudited)
				March 31,		December 31,
				2017		2016
ASSETS
	Current assets
		Cash and cash equivalents	$	16,206,632	$	22,954,571
		Cash held in escrow		70,076,034		70,000,000
		Accounts receivable		2,154,575		3,117,474
		Inventory		460,721		196,723
		Prepaid expenses and other assets		877,948		505,340
	Total current assets			89,775,910		96,774,108
	Non-current assets
		Restricted cash		450,360		449,760
		Property, plant and equipment		1,760,872		1,585,635
	Total non-current assets			2,211,232		2,035,395
Total assets			$	91,987,142	$	98,809,503
LIABILITIES AND EQUITY
	Liabilities
	Current liabilities
		Accounts payable and accrued liabilities	$	2,004,783	$	2,490,943
		Damages provision		111,992,980		111,781,096
	Total current liabilities and total liabilities			113,997,763		114,272,039
	Equity
		Share capital		168,746,036		168,712,673
		Contributed surplus		23,647,293		22,301,437
		Accumulated other comprehensive loss		(4,775,357)		(4,693,040)
		Deficit		(209,628,593)		(201,783,606)
	Total equity			(22,010,621)		(15,462,536) Werbung Mehr Nachrichten zur Neovasc Aktie kostenlos abonnieren E-Mail-Adresse Bitte überprüfe deine die E-Mail-Adresse. Benachrichtigungen von ARIVA.DE (Mit der Bestellung akzeptierst du die Datenschutzhinweise) -1 Vielen Dank, dass du dich für unseren Newsletter angemeldet hast. Du erhältst in Kürze eine E-Mail mit einem Aktivierungslink. Hinweis: ARIVA.DE veröffentlicht in dieser Rubrik Analysen, Kolumnen und Nachrichten aus verschiedenen Quellen. Die ARIVA.DE AG ist nicht verantwortlich für Inhalte, die erkennbar von Dritten in den „News“-Bereich dieser Webseite eingestellt worden sind, und macht sich diese nicht zu Eigen. Diese Inhalte sind insbesondere durch eine entsprechende „von“-Kennzeichnung unterhalb der Artikelüberschrift und/oder durch den Link „Um den vollständigen Artikel zu lesen, klicken Sie bitte hier.“ erkennbar; verantwortlich für diese Inhalte ist allein der genannte Dritte. Andere Nutzer interessierten sich auch für folgende News 12:11 - PR Newswire BlackRock Sustainable American Income Trust Plc - Transaction in Own Shares 11:44 - PR Newswire BlackRock Income and Growth Investment Trust Plc - Portfolio Update 02:00 - PR Newswire Vesuvius Plc - Transaction in Own Shares Der KI-Boom ist vorbei!    Aber dieser heiße Sektor verspricht, weiter zu wachsen... weiterlesen» Anzeige wo-site-teaser-box-16737_site-teaser-box_2024-04-23_09%253A00%253A00_2024-04-24_09%253A00%253A59