RICHLAND, Wash., Feb. 8, 2017 /PRNewswire/ -- IsoRay, Inc. (NYSE
MKT: ISR), a medical technology company and innovator in seed
brachytherapy and medical radioisotope applications for the
treatment of prostate, brain, lung, head and neck and gynecological
cancers, today announced financial results for the
second quarter of fiscal 2017, ended December 31,
2016.
Revenue for the second quarter of fiscal 2017 was $1.03 million, a 14% decrease compared to
$1.19 million revenue for the second
quarter of fiscal 2016. The decrease in revenue is primarily due to
the continuing maturation of our recently adopted marketing
approach and ongoing training and support for our sales staff
following recent changes in personnel. Prostate brachytherapy
represented 86% of total revenue for the second quarter of fiscal
2017 compared to 87% in the second quarter of fiscal 2016. Total
operating expenses were $1.48 million
in the second quarter of fiscal 2017, a modest increase compared to
$1.44 million posted in the second
quarter of fiscal 2016. Increases in research and development and
sales and marketing expenses were offset by a decrease in general
and administrative (G&A) expenses of $0.25 million, or 22%. The G&A decrease is
primarily due to lower legal fees as well as the absence of
one-time costs associated with the retirement of the Company's
former CEO, which were recorded in the second quarter of fiscal
2016.
Operating loss was $1.48 million,
a modest increase compared to an operating loss of $1.41 million for the second quarter of fiscal
2016. The net loss was $1.45 million,
or $(0.03) per basic and diluted
share, compared to a net loss of $1.31
million, or $(0.02), per basic
and diluted share, for the same period of fiscal 2016. Basic and
diluted per share results are based on weighted average shares
outstanding of approximately 55.0 million shares in both periods.
IsoRay had cash, cash equivalents and certificates of deposit of
$11.9 million as of December 31, 2016, and no debt.
"While not yet reflected in our financial results, our newly
adopted, focused marketing approach that positions IsoRay and
Cesium-131 as a leader in brachytherapy for prostate cancer
treatment is gaining traction, supported by our recently expanded
and experienced sales force. We are continuing to bolster the sales
force, and replaced two salespeople in the second quarter. Our
sales force now numbers six, which includes four salespeople that
are new to IsoRay. We're also continuing to add content, case
studies and other resources to our recently re-branded website,
collateral marketing materials and a recently launched expanded
social media presence, all in our effort to raise awareness of
IsoRay and the advantages of Cesium-131. The sales force has become
increasingly effective in delivering IsoRay's renewed message of
commitment to prostate brachytherapy, which has been reinforced
during follow-up visits and conversations with senior management,
including myself," said Thomas
LaVoy, Chairman and CEO.
"At the same time we are continuing to support and pursue
opportunities for Cesium-131 as a treatment for cancers in other
areas of the body, including brain, lung, head and neck and
gynecological cancers. We believe these areas represent important
avenues of potential revenue growth for the Company. During the
second quarter, we announced a poster presentation at the Annual
Meeting of the Society for Neuro-Oncology that was held in
November, which details recurrences of high grade glioma which were
treated with surgical removal of the recurrent brain tumor followed
by placement of the GammaTile™ radiation therapy system. The
GammaTile™ system uses Cesium-131 radiation sources embedded in a
collagen carrier and enables very high doses of radiation to be
precisely delivered to targeted tissue. At the time of
presentation, the median time to recurrence had clearly been
extended from four months previously for this group of patients,
but remained fully undefined due to the majority of patients still
experiencing no recurrence at six months post treatment."
"Also during the second quarter, we announced the launch of a
pilot study using intraoperative placement of Cesium-131 permanent
interstitial brachytherapy in resectable high risk recurrent head
and neck cancer by Case Western Comprehensive Cancer Center, a
leader in cancer research and among the 41 Comprehensive Cancer
Centers designated in the U.S. by the National Cancer Institute.
The study will evaluate the impact of Cesium-131 therapy on disease
control in recurrent head and neck cancers as well as the safety of
the approach beginning in early 2017. These are just the two latest
examples of the research we are supporting in the other areas of
the body that we're focused on," continued Mr. LaVoy.
"Our financial results do indicate incremental improvement, with
the second quarter operating loss nearly flat year-over-year,
despite the 14% decline in revenue. This reflects tight expense
control and reallocation of resources toward revenue producing
areas such as sales and marketing and research and development. We
are also continuing to invest in the automation of our production
processes and expect to realize lower costs over the next 12 months
from these efforts. Looking ahead, we believe that there is
increasing market interest in Cesium-131 and, if revenue levels
begin to increase and costs stabilize around current levels, we
expect to benefit from increasing operating leverage. We also
continue to expect a stronger second half of fiscal 2017, which
began on January 1st, and
are estimating a revenue increase of approximately 20%
year-over-year for the remaining six months of fiscal 2017,"
concluded Mr. LaVoy.
For the first six months of fiscal 2017 ended December 31, 2016, revenue was $2.11 million, a 14% decrease compared to revenue
of $2.45 million for the same period
of fiscal 2016. Prostate brachytherapy represented 88% of total
revenue for the first six months of both fiscal 2017 and fiscal
2016. Operating expenses were $3.10
million, a 19% increase compared to $2.61 million for the six months ended
December 31, 2015. Operating loss was
$3.05 million for the six months
ended December 31, 2016, compared to
a $2.50 million operating loss for
the comparable period of fiscal 2016. The net loss for the six
month period was $2.95 million, or
$(0.05) per basic and diluted share,
compared to a net loss of $2.31
million, or $(0.04), per basic
and diluted share, for the six month period of fiscal 2016. Basic
and diluted per share results are based on weighted average shares
outstanding of approximately 55.0 million shares in both
periods.
About IsoRay, Inc.
IsoRay, Inc., through its subsidiary, IsoRay Medical, Inc. is
the sole producer of Cesium-131 brachytherapy seeds, which are
expanding brachytherapy options throughout the body. Learn more
about this innovative Richland,
Washington Company and explore the many benefits and uses of
Cesium-131 by visiting www.isoray.com. Join us on Facebook/IsoRay.
Follow us on Twitter @IsoRay.
Safe Harbor Statement
Statements in this news release about IsoRay's future
expectations, including: the advantages of our products and their
delivery systems, whether interest in and use of our products will
increase or continue, whether the new marketing strategy will
increase sales, whether the changes to the sales staff will result
in increased sales, whether the additional resources being added to
IsoRay's online presence will increase patient or clinician
engagement and interest, whether use of Cesium-131 in non-prostate
applications will increase revenue, whether further automation of
production processes will be completed or will result in lower
costs, whether revenue will increase by 20% year-over-year for the
remaining six months of fiscal 2017, and all other statements in
this release, other than historical facts, are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 ("PSLRA"). This statement is included for the
express purpose of availing IsoRay, Inc. of the protections of the
safe harbor provisions of the PSLRA. It is important to note that
actual results and ultimate corporate actions could differ
materially from those in such forward-looking statements based on
such factors as physician acceptance, training and use of our
products, our ability to successfully manufacture, market and sell
our products, our ability to manufacture our products in sufficient
quantities to meet demand within required delivery time periods
while meeting our quality control standards, our ability to enforce
our intellectual property rights, whether additional studies are
released and support the conclusions of past studies, whether
ongoing patient results with our products are favorable and in line
with the conclusions of clinical studies and initial patient
results, patient results achieved when our products are used for
the treatment of cancers and malignant diseases, successful
completion of future research and development activities, whether
we, our distributors and our customers will successfully obtain and
maintain all required regulatory approvals and licenses to market,
sell and use our products in its various forms, continued
compliance with ISO standards as audited by BSI, the success of our
sales and marketing efforts, changes in reimbursement rates,
changes in laws and regulations applicable to our products, the
scheduling of physicians who either delay or do not schedule
patients in the six month period that an increase is anticipated,
the use of competitors' products in lieu of our products over the
six month period we expect an increase, less favorable
reimbursement rates during the six month period we expect an
increase, and other risks detailed from time to time in IsoRay's
reports filed with the SEC. Unless required to do so by law, the
Company undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
IsoRay, Inc. and
Subsidiaries
|
|
|
|
|
Consolidated
Statements of Operations (Unaudited)
|
|
|
|
|
(Dollars and
shares in thousands, except for per-share amounts)
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
December
31,
|
|
December
31,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
Product sales,
net
|
$
1,028
|
|
$
1,189
|
|
$
2,109
|
|
$
2,450
|
Cost of product
sales
|
1,029
|
|
1,162
|
|
2,062
|
|
2,340
|
Gross profit /
(loss)
|
(1)
|
|
27
|
|
47
|
|
110
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Research and
development
|
150
|
|
58
|
|
322
|
|
202
|
Sales and
marketing
|
496
|
|
254
|
|
1,020
|
|
533
|
General and
administrative
|
880
|
|
1,125
|
|
1,807
|
|
1,876
|
Change in
estimate of asset retirement obligation (Note 13)
|
(48)
|
|
-
|
|
(48)
|
|
-
|
Total operating
expenses
|
1,478
|
|
1,437
|
|
3,101
|
|
2,611
|
|
|
|
|
|
|
|
|
Operating
loss
|
(1,479)
|
|
(1,410)
|
|
(3,054)
|
|
(2,501)
|
|
|
|
|
|
|
|
|
Non-operating
income:
|
|
|
|
|
|
|
|
Interest income,
net
|
29
|
|
56
|
|
60
|
|
112
|
Change in fair
value of warrant derivative liability
|
-
|
|
43
|
|
27
|
|
58
|
Other
income
|
-
|
|
-
|
|
20
|
|
-
|
Financing and
interest expense
|
-
|
|
-
|
|
-
|
|
-
|
Non-operating
income, net
|
29
|
|
99
|
|
107
|
|
170
|
|
|
|
|
|
|
|
|
Net
loss
|
(1,450)
|
|
(1,311)
|
|
(2,947)
|
|
(2,331)
|
Preferred stock
deemed dividends
|
-
|
|
-
|
|
-
|
|
-
|
Preferred stock
dividends
|
(2)
|
|
(3)
|
|
(5)
|
|
(5)
|
|
|
|
|
|
|
|
|
Net loss
applicable to common shareholders
|
(1,452)
|
|
(1,314)
|
|
(2,952)
|
|
(2,336)
|
|
|
|
|
|
|
|
|
Basic and
diluted loss per share
|
$
(0.03)
|
|
$
(0.02)
|
|
$
(0.05)
|
|
$
(0.04)
|
|
|
|
|
|
|
|
|
Weighted
average shares used in computing net loss per share:
|
|
|
|
|
|
|
|
Basic and
diluted
|
55,017
|
|
55,014
|
|
55,014
|
|
55,013
|
|
|
|
|
|
|
|
|
The accompanying
notes are an integral part of these consolidated financial
statements.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/isoray-announces-second-quarter-fiscal-2017-financial-results-300404542.html
SOURCE IsoRay, Inc.