Rockwell Medical Reports Excellent Fourth Quarter and Full Year 2009 Business Results
Mar 10, 2010 (GlobeNewswire via COMTEX News Network) --
Gross Profit Increases $2.25 million in Q4; Gross Profit up 215% for the
Year
Conference Call at 4:15pm ET to Discuss Results and Review Clinical
Development
WIXOM, Mich., March 10, 2010 (GLOBE NEWSWIRE) -- Rockwell Medical (Nasdaq: RMTI), a fully-integrated biopharmaceutical company offering innovative products and services targeting end-stage renal disease (ESRD), chronic kidney disease (CKD) and iron deficiency anemia, reported today fourth quarter and full-year 2009 results.
Fourth Quarter Financial Highlights
-- Sales were $14.8 million, an increase of 9.0% compared to the fourth
quarter of 2008.
-- Sales increased 4.3% sequentially or $0.6 million over the third quarter
of 2009.
-- Gross profit increased $2.25 million to $2.4 million compared to $0.2
million in the fourth quarter of 2008.
-- Gross profit margins were 16.4%, an increase of 15.1% compared to gross
profit margin of 1.3% in 2008.
-- R&D expense was $1.1 million compared to $1.3 million in the fourth
quarter 2008.
-- Loss of ($0.5) million compared to a loss of ($3.0) million in the
fourth quarter 2008.
2009 Financial Highlights
-- Improved profitability of core business operations (excluding R&D
expense).
-- Sales were $54.7 million, an increase of $3.1 million or 5.9% compared
to 2008.
-- Gross profit margins were 14.4%, an increase of 9.5% compared to gross
profit margin of 4.9% in 2008.
-- Gross profit increased 215% to $7.9 million compared to $2.5 million in
2008.
-- R&D expense was $6.5 million compared to $3.8 million in 2008.
-- Loss of ($5.5) million compared to a loss of ($7.9) million in 2008.
-- $23 million year-end cash position.
2009 Drug Development and Corporate Progress
-- Raised $20.4 million in net proceeds from a registered direct offering
that closed in October 2009.
-- Completed SFP Phase IIb dose range, safety and exploratory study in
October 2009.
-- Added senior expertise to the drug development team with the addition of
Dr. Richard Yocum and Dr. Ajay Gupta.
-- Enhanced regulatory expertise with the addition of Dr. Jur Strobos M.D.
to Scientific Advisory Board.
-- Presented new in vitro iron-binding data on proprietary iron-delivery
drug SFP at the American Society of Nephrology (ASN) annual meeting in
San Diego, CA.
-- Unveiled rebranded Company with new name, logo and website to better
reflect the Company's strategic focus towards bio-pharma
(www.rockwellmed.com) at the American Society of Nephrology (ASN) annual
meeting in San Diego, CA.
-- Included into the Russell 2000, 3000 and Global Indices.
Mr. Robert L. Chioini, Chairman and CEO stated, "We made great progress in 2009, showing improvements in both our operating business and our drug development business. Our operating margins increased significantly, due in part to higher end-user prices and our continued effort to improve internal efficiencies, thereby contributing cash flow to our drug development efforts. Our recently released Phase IIb study data demonstrated SFP is well-tolerated and safe, confirmed dosing for Phase III and provided valuable data for us to design a thoughtful and carefully planned Phase III trial protocol. We are planning our end-of-Phase II meeting with the FDA in order to review our Phase III clinical design and we anticipate commencing SFP's Phase III clinical program in the second-half of the year."
About SFP:
SFP is a novel, investigational, continuous iron therapy designed to treat iron deficiency anemia in ESRD patients. SFP is a proprietary, water-soluble form of iron that travels directly to the bloodstream and transfers iron at a cellular level, similar to normal physiologic dietary iron intake. SFP is designed as a continuous replacement treatment delivering small doses of iron during every dialysis session in order to replenish iron lost during the dialysis procedure, thereby maintaining hemoglobin in the target range as per Kidney Disease Quality Outcomes Initiative (KDQOI) recommendations. Clinical trials to date suggest that SFP, delivered during each dialysis treatment via dialysate, maintains optimal iron balance and avoids liver toxicity while decreasing associated drug administration costs. Recent academic studies have shown that more frequent maintenance doses of iron improve the therapeutic response to erythropoiesis-stimulating agents (ESA), thereby decreasing the ESA doses needed to maintain hemoglobin in the target range. Rockwell Medical has licensed exclusive world-wide rights to manufacture and sell SFP and patents have issued for SFP in multiple countries, including the three largest dialysis markets in the world: the United States, Japan, and the European Union. Based on current market data, the U.S. dialysis market for IV iron is approximately $560 million annually while global market potential is approximately $850 million.
About Rockwell Medical:
Rockwell Medical is a fully-integrated biopharmaceutical company offering innovative products and services initially targeting end-stage renal disease (ESRD), chronic kidney disease (CKD), and iron deficiency anemia. An established manufacturer and leader in delivering high-quality hemodialysis concentrates/dialysates to dialysis providers and distributors in the U.S. and abroad, Rockwell provides products that are used to maintain human life by removing toxins and replacing critical nutrients in the dialysis patient's bloodstream. Dialysis is a process that duplicates kidney function for patients who suffer from ESRD. There are approximately 400,000 ESRD patients in the United States, a prevalence growing at an annual rate of 4 percent, and approximately 2 million ESRD patients world-wide.
The Company is currently developing unique, proprietary renal drug therapies for iron treatment. These exclusive renal drug therapies support disease management initiatives to improve the quality of life and care of dialysis patients and are designed to deliver safe and effective therapy, while decreasing drug administration costs and improving patient convenience. Rockwell Medical is developing a pipeline of drug therapies, including extensions of SFP for indications outside of hemodialysis. Please visit www.rockwellmed.com for more information.
Certain statements in this press release constitute "forward-looking statements" within the meaning of the federal securities laws. Words such as "may," "might," "will," "should," "believe," "expect," "anticipate," "estimate," "continue," "predict," "forecast," "project," "plan", "intend" or similar expressions, or statements regarding intent, belief, or current expectations, are forward-looking statements. While the Company believes these forward-looking statements are reasonable, undue reliance should not be placed on any such forward-looking statements, which are based on information available to us on the date of this release. These forward looking statements are based upon current estimates and assumptions and are subject to various risks and uncertainties, including without limitation those set forth in the Rockwell Medical's SEC filings. Thus, actual results could be materially different. Rockwell Medical expressly disclaims any obligation to update or alter statements whether as a result of new information, future events or otherwise, except as required by law.
ROCKWELL MEDICAL TECHNOLOGIES, INC.
CONSOLIDATED INCOME STATEMENTS
For the three and twelve months ended December 31, 2009 and December 31, 2008
Three Months Three Months
Ended Ended Year Ended Year Ended
December 31, December 31,
2009 2008 December 31, December 31,
(unaudited) (unaudited) 2009 2008
------------- ------------- ------------- -------------
Sales $ 14,761,487 $ 13,537,674 $ 54,729,505 $ 51,666,033
Cost of Sales 12,333,924 13,360,807 46,842,334 49,159,478
------------- ------------- ------------- -------------
Gross Profit 2,427,563 176,867 7,887,171 2,506,555
Selling, General and Administrative 1,836,125 1,975,942 6,914,198 6,761,617
Research and Product Development 1,141,853 1,272,416 6,454,352 3,830,134
------------- ------------- ------------- -------------
Operating (Loss) (550,415) (3,071,491) (5,481,379) (8,085,196)
Interest Expense (Income), Net (634) (38,657) 19,859 (221,139)
------------- ------------- ------------- -------------
Net (Loss) $ (549,781) $ (3,032,834) $ (5,501,238) $ (7,864,057)
============= ============= ============= =============
Basic Earnings (Loss) per Share $ (0.03) $ (0.22) $ (0.37) $ (0.57)
Diluted Earnings (Loss) per Share $ (0.03) $ (0.22) $ (0.37) $ (0.57)
Note:
In the Consolidated Income Statements the Company reclassified specific quality assurance and operations management expenses totaling $112,000 to "cost of sales" from "selling, general and administrative expense" for the fourth quarter of 2008 and $510,000 for 2008 to maintain comparability of prior year results with the current year presentation.
ROCKWELL MEDICAL TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
As of December 31, 2009 and 2008
December 31, 2009 December 31, 2008
----------------- -----------------
ASSETS
Cash and Cash Equivalents $ 23,038,095 $ 5,596,645
Accounts Receivable, net of a
reserve of $31,000 in 2009
and $97,000 in 2008 3,492,622 5,229,656
Inventory 3,088,352 3,161,625
Other Current Assets 329,876 440,765
----------------- -----------------
Total Current Assets 29,948,945 14,428,691
Property and Equipment, net 3,631,549 3,249,003
Intangible Assets 214,337 240,656
Goodwill 920,745 920,745
Other Non-current Assets 163,645 120,887
----------------- -----------------
Total Assets $ 34,879,221 $ 18,959,982
================= =================
LIABILITIES AND SHAREHOLDERS'
EQUITY
Capitalized Lease Obligations $ 42,938 $ 176,850
Accounts Payable 3,388,757 5,210,972
Accrued Liabilities 1,854,347 1,464,828
Customer Deposits 250,915 245,186
----------------- -----------------
Total Current Liabilities 5,536,957 7,097,836
Capitalized Lease Obligations 19,062 41,203
Shareholders' Equity:
Common Shares, no par value,
17,200,442 and 14,104,690
shares issued and outstanding 53,545,394 34,799,093
Common Share Purchase
Warrants, 3,318,569 and
2,114,169 warrants issued and
outstanding 7,635,594 3,378,398
Accumulated Deficit (31,857,786) (26,356,548)
----------------- -----------------
Total Shareholders' Equity 29,323,202 11,820,943
----------------- -----------------
Total Liabilities And
Shareholders' Equity $ 34,879,221 $ 18,959,982
================= =================
ROCKWELL MEDICAL TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2009 and 2008
2009 2008
------------- -------------
Cash Flows From Operating Activities:
Net (Loss) $ (5,501,238) $ (7,864,057)
Adjustments To Reconcile Net Loss To Net
Cash Used In
Operating Activities:
Depreciation and Amortization 1,233,706 911,718
Share Based Compensation --
Non-employee warrants 403,203 339,987
Share Based Compensation- Employees 1,949,684 1,115,231
Loss (Gain) on Disposal of Assets 36,415 (7,534)
Changes in Assets and Liabilities:
(Increase) Decrease in Accounts
Receivable 1,737,034 (542,427)
(Increase) Decrease in Inventory 73,273 (602,574)
(Increase) Decrease in Other Assets 68,131 (133,412)
Increase (Decrease)in Accounts Payable (1,822,215) 2,228,073
Increase in Other Liabilities 395,248 286,497
------------- -------------
Changes in Assets and Liabilities 451,471 1,236,157
------------- -------------
Cash (Used) In Operating Activities (1,426,759) (4,268,498)
Cash Flows From Investing Activities:
Purchase of Equipment (1,595,999) (1,268,498)
Proceeds on Sale of Assets -- 9,555
Purchase of Intangible Assets (4,949) (903)
------------- -------------
Cash (Used ) In Investing Activities (1,600,948) (1,259,846)
Cash Flows From Financing Activities:
Proceeds from Issuance of Common Shares
and Purchase Warrants 20,650,610 232,140
Payments on Notes Payable and Capital
Lease Obligations (181,453) (204,243)
------------- -------------
Cash Provided By Financing Activities 20,469,157 27,897
Increase (Decrease) In Cash 17,441,450 (5,500,447)
Cash At Beginning Of Period 5,596,645 11,097,092
------------- -------------
Cash At End Of Period $ 23,038,095 $ 5,596,645
============= =============
Conference Call Information:
Rockwell Medical will be hosting a conference call to review its 2009 fourth quarter results on Wednesday, March 10, 2010 at 4:15 pm ET. Investors are encouraged to call a few minutes in advance at (877) 383-7438 or to listen to the call or on the web at:
The call will be available for replay at the same link above.
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: Rockwell Medical Technologies, Inc.
CONTACT: LaVoie Group Media Contact: Lisa Rivero, Director, Media Relations (978)745-4200 ext. 106 The Trout Group LLC Investor Contact: Brian Korb, VP (646) 378-2923
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