CALGARY, AB, Aug. 24, 2020 /CNW/ - Nanalysis Scientific Corp.
("the Company", TSXV:NSCI, OTCQX:NSCIF, FRA:1N1) released today its
second quarter 2020 results.
|
Three months ended
June 30
|
Six months ended June
30
|
($000's)
|
2020
|
2019
|
($) Change
|
2020
|
2019
|
($) Change
|
|
|
|
|
|
|
|
Revenue
|
1,995
|
2,535
|
(540)
|
3,520
|
4,600
|
(1,080)
|
Cost of products
sold
|
731
|
768
|
(37)
|
1,272
|
1,498
|
(226)
|
Gross
profit
|
1,264
|
1,767
|
(503)
|
2,248
|
3,102
|
(854)
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
Sales and
marketing
|
628
|
513
|
115
|
1,380
|
1,180
|
200
|
General and
administration
|
824
|
768
|
56
|
1,518
|
1,282
|
236
|
Earnings (loss)
before other items
|
(188)
|
486
|
(674)
|
(650)
|
640
|
(1,290)
|
|
|
|
|
|
|
|
Other Items
(1)
|
419
|
1,699
|
(1,280)
|
957
|
2,055
|
(1,098)
|
Loss before
tax
|
(607)
|
(1,213)
|
606
|
(1,607)
|
(1,415)
|
(192)
|
Deferred tax
recovery
|
82
|
36
|
46
|
175
|
36
|
139
|
Net
loss
|
(525)
|
(1,177)
|
652
|
(1,432)
|
(1,379)
|
(53)
|
Other comprehensive
income
|
167
|
-
|
167
|
142
|
-
|
142
|
Total
comprehensive loss
|
(358)
|
(1,177)
|
819
|
(1,290)
|
(1,379)
|
89
|
(1) other
items includes acquisition transaction costs, RTO transaction
costs, depreciation and amortization expense, finance expense
(income), stock-based compensation and foreign exchange (gain)
loss
|
OUTLOOK
Nanalysis has addressed the recent outbreak of
COVID-19 by adapting numerous work policies. This has allowed
Nanalysis to continue operations with minimal disruptions to our
development, manufacturing, and distribution. Marketing
and sales still face significant disruptions to normal operating
procedures due to the restrictions of in-person meetings and border
closures during the quarter. The Company has utilized government
programs offered to Company's impacted by COVD-19, specifically the
Canadian Emergency Wage Subsidy ("CEWS") and Canadian Emergency
Business Account ("CEBA"). Nanalysis will continue to monitor
results and seek government assistance where applicable.
Despite COVID-19 short-term market forces
presenting challenges in the second quarter and into the latter
half of 2020, Nanalysis continues to have confidence that the
market for compact NMR spectrometers and related accessories and
services will grow in the medium term. To date, the Company
has received $2,626k pre-orders for
our 100MHz product, of which $438k
was reflected in unearned revenue as at June
30, 2020. The nascent nature of the Company's
market opportunity coupled with the value proposition
to its customers will continue to drive
increased demand for compact NMR devices in growing
number of research, commercial, and industrial applications. The
Company is continuing to develop cutting edge new
products, is working with local, national, and
international partners to develop use-specific solutions in a
variety of industries, and will continue to execute its acquisition
strategy.
The five objectives the Company is committed to for the
remainder of 2020 are: (1) release of our new 100 MHz product, (2)
continued execution of our acquisition strategy, (3) continued
vertical market partnering agreements, and (4) expanding investor
relations activity, especially in the
United States in keeping with our recent OTCQX listing (5)
realization of our large balance of unearned revenue.
SECOND QUARTER HIGHLIGHTS
- Revenue for the three months ended June
30, 2020 was $1,995K as
compared to $2,535K in the prior
ended June 30, 2019. Nanalysis
reported revenues of $1,405K, with
RS2D reporting $590K for the three
months ended June 30, 2020.
- Gross profit for three months ended June
30, 2020 was $1,264K (a margin
of 63%) as compared to gross profit of $1767K (a margin of 70%) for 2019.
- Total comprehensive loss for the three months ended
June 30, 2020 was $358K as compared to a loss of $1,177K from the comparative period ended
June 30, 2019. Basic and diluted loss
per share for three months ended June 30,
2020 was $0.01 as compared to
a loss per share for the three months ended June 30, 2019 of $0.02.
FINANCIAL POSITION
At June 30, 2020, Nanalysis had
$5,233K (December 31, 2019 - $8,534K) of working capital, including
$4,805K (December 31, 2019 - $6,619k) in cash. The Company has an undrawn line
of credit of $2,000K and $1,046K of available borrowing on the Western
Economic Diversification Canada interest free loan. Nanalysis's
business has been affected by COVID-19 and as such is eligible for
a subsidy of 75% of employees' wages. During the three and six
months ended June 30, 2020 the
Company received $715K from the CEWS.
Nanalysis will continue to monitor revenues and seek government
assistance where applicable.
OVERALL PERFORMANCE
For the six months ended June 30,
2020, the Company reported consolidated revenue of
$3,520K, a decrease of $1,080K or 23% from the comparative period in
2019. Unearned revenue was $2,170K as
at June 30, 2020, an increase of
$1,554K from $616K as at December
31, 2019. The increase was due to the acquisition of
RS2D and the associated backlog of work that they were unable to
complete in the quarter due to COVID-19 delays, couple with an
increase in extended warranty sales to customers, and customer
deposits on pre-orders for the 100MHz product. The decrease in
revenue was partially a result from COVID-19 as local, national,
and international regulations have made conducting business
difficult amid 'shut down and shelter in place' orders. Nanalysis
has faced delayed international shipments due to border closures,
while RS2D employees in Strasbourg,
France were unable service customers as all nonessential
services were prohibited. Also contributing to the reduction in
revenue is customers holding off on purchases and awaiting the
release of the 100MHz device.
Gross profit for six months ended June
30, 2020 was $2,248K (a margin
of 64%) as compared to gross profit of $3,102K (a margin of 67%) for 2019.
The Company's comprehensive loss for the six months ended
June 30, 2020 was $1,290K as compared to comprehensive loss of
$1,379K for the comparative period in
2019. The loss for the six months ended June
30, 2020 was due to decreased sales, increased depreciation
and amortization, acquisition transaction costs, increase general
and administration expense, partially offset by an increase on
foreign exchange gain, finance income, other comprehensive income
and deferred tax recovery. The loss for the six months ended
June 30, 2019 was primarily due to
$1,360K of reverse takeover
transaction costs.
About Nanalysis Scientific Corp. (TSXV:NSCI,
OTCQX:NSCIF, FRA:1N1)
The Company trades on the TSX Venture Exchange (TSXV) in
Canada with ticker symbol 'NSCI'
and over the counter in the United
States under the ticker symbol 'NSCIF'.
Nanalysis business is what we term "MRI for industry": It
develops and manufactures portable Nuclear Magnetic Resonance (NMR)
spectrometers or analyzers for laboratory and industrial markets.
The NMReady60™ was the first fully featured portable NMR
spectrometer in a single compact enclosure requiring no liquid
helium or any other cryogens, and the company continues to develop
new products and has a strong innovation pipeline. Nanalysis began
taking orders for the 100MHz device in early 2020. The Company's
new device will be the most powerful non-cryogen, permanent magnet
compact NMR device ever brought to market. Nanalysis devices are
used by chemical professionals in many industries (oil and gas,
chemical, mining, pharma, biotech, flavor and fragrances,
agrochemicals, and more) as well as numerous government and
university research labs around the world. The company continues to
exploit new global market opportunities both independently and with
partners.
In March 2020, the Company
acquired all outstanding shares of RS2D, a complementary technology
company based in Strasbourg France
that specializes in the development of cutting-edge MR
electronics. Based on a single electronic board, RS2D has
developed MR product lines in high-field ("HF") NMR and magnetic
resonance imaging ("MRI") that can further advance Nanalysis'
existing product line, while the new products to round out the
Company's magnetic resonance technology portfolio.
Notice regarding Forward Looking Statements and Legal
Disclaimer
This news release contains certain "forward-looking statements"
within the meaning of such statements under applicable securities
law. Forward-looking statements are frequently characterized by
words such as "anticipates", "plan", "continue", "expect",
"project", "intend", "believe", "anticipate", "estimate", "may",
"will", "potential", "proposed", "positioned" and other similar
words, or statements that certain events or conditions "may" or
"will" occur. These statements are only predictions. Various
assumptions were used in drawing the conclusions or making the
projections contained in the forward-looking statements throughout
this news release. Forward-looking statements are based on the
opinions and estimates of management at the date the statements are
made and are subject to a variety of risks and uncertainties and
other factors that could cause actual events or results to differ
materially from those projected in the forward-looking statements.
The Company is under no obligation, and expressly disclaims any
intention or obligation, to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as expressly required by applicable law.
Neither TSX Venture Exchange nor its Regulation Services
Provider accepts responsibility for the adequacy or accuracy of
this release.
SOURCE Nanalysis Scientific Corp.