MINNEAPOLIS, Jan. 27, 2011 /PRNewswire/ -- Uroplasty, Inc. (Nasdaq: UPI), a medical device company that develops, manufactures and markets innovative proprietary products to treat voiding dysfunctions, today reported financial results for the third fiscal quarter ended December 31, 2010.
Global sales grew 14% to $3.5 million, compared with $3.1 million in the same quarter a year ago. The growth was driven by strength in U.S. sales, up 33% from the third quarter a year ago. The increase in U.S. sales reflected a 64% increase in sales of the Macroplastique product line, where the Company has had a focused marketing effort. Sales of the Urgent PC Neuromodulation System in the U.S. for the recent third fiscal quarter totaled $1.0 million, an increase of 10% from the prior year's third quarter. The number of customers in the U.S. purchasing the Urgent PC Neuromodulation System during the quarter increased to 236 from 185 in the second quarter ended September 30, 2010.
The Company also announced that two additional Medicare carriers, Cahaba Government Benefit Administrators®, LLC and First Coast Service Options, Inc. (FCSO), have begun to pay for Percutaneous Tibial Nerve Stimulation (PTNS) treatments, using the Urgent PC Neuromodulation System. Cahaba administers Medicare health insurance for the states of Alabama, Georgia, Mississippi and Tennessee. FCSO is the Medicare carrier for Florida, Puerto Rico and the U.S. Virgin Islands.
With the addition of these two carriers, there are now nine regional Medicare carriers providing coverage for PTNS, using Urgent PC, for the treatment of symptoms of overactive bladder syndrome in 29 states and two territories. Coverage of PTNS using the Urgent PC Neuromodulation System, currently extends to approximately 28 million lives of the 46 million total lives covered under Medicare.
"We were very encouraged by the growth in Urgent PC customers in the U.S. We believe the availability of a Category I CPT® code for PTNS, a favorable reimbursement amount under Medicare coverage and recent decisions by several Medicare carriers to cover the treatment when the CPT code became effective on January 1, 2011 are creating renewed interest in PTNS," said David Kaysen, President & CEO of Uroplasty, Inc. "The number of customers grew in the third quarter as physicians began to ramp up their practices in light of the positive Medicare reimbursement decisions. We saw a surge in new and reengaged customers in December and expect to see continued growth in the adoption of Urgent PC. However, it is important to note that the exceptional rate of adoption we experienced in the third quarter reflected some pent up demand from physicians, who were waiting for implementation of the CPT code and confirmation of positive reimbursement rates."
"The coverage of PTNS using Urgent PC, by Cahaba and FCSO continues to show the strength of the clinical data that supports the effectiveness and safety of Urgent PC for treating the symptoms of overactive bladder," Mr. Kaysen added. "In addition to the nine regional Medicare carriers that today provide reimbursement for PTNS, there is now one carrier, representing five states with approximately two million covered lives that has indicated it will cover on a case-by-case basis. An additional three Medicare carriers, representing 16 states with approximately 17 million covered lives, continue to decline reimbursement coverage for PTNS."
"Our reimbursement team is working to move the case-by-case coverage to routine coverage and to have the negative coverage decisions reversed," continued Mr. Kaysen. "We are also working with select private health insurers to educate them on the benefits and results of clinical studies that demonstrate the success of PTNS in the treatment of overactive bladder. In anticipation of increased interest in Urgent PC, we have expanded our U.S. field sales and support organization. At December 31, 2010, we had 31 sales representatives compared with 19 sales reps at September 30, 2010."
"As we look ahead, we anticipate continued demand for our Urgent PC Neuromodulation System, as physicians become more comfortable with the treatment and gather additional patient feedback and reimbursement experience. We are focused on execution, driving adoption and sales of Urgent PC and Macroplastique in the U.S., and maintaining our presence in international markets. With the capital raise in July, we have sufficient cash to pursue these growth initiatives," Mr. Kaysen concluded.
Fiscal Third Quarter and First Nine Months Results for the Period Ended December 31, 2010 Net sales for the three months ended December 31, 2010 totaled $3.5 million, an increase of 14% over net sales of $3.1 million for the third quarter of the prior fiscal year. Excluding the translation impact of foreign currency exchange rates, sales increased by approximately 17%. For the nine months ended December 31, 2010, net sales were $9.8 million, a 10% increase above net sales for the comparable period of 2009 of $8.9 million. Excluding the impact of foreign exchange translation, sales grew by 14%.
Sales to customers in the U.S. for the three months ended December 31, 2010 were $2.0 million, a 33% increase compared to $1.5 million in net sales for the year-ago quarter. During the first nine months of fiscal 2011, sales to customers in the U.S. totaled $5.5 million, representing a 22% increase over net sales of $4.5 million for the comparable nine month period of fiscal 2010.
Sales in the U.S. of the Urgent PC product for the three months ended December 31, 2010 increased 10% to $1.0 million compared with $934,000 for the same period last year. For the recent nine month period, sales from Urgent PC totaled approximately $3.0 million, an increase of 1% over sales in the comparable period last year.
Sales in the U.S. of Macroplastique increased 64% to $925,000 for the three months ended December 31, 2010, from $565,000 for the same period last year. For the nine months of fiscal 2011, sales of Macroplastique increased 60% to $2.4 million compared with $1.5 million in the same period a year ago, reflecting the increased sales and marketing focus on this product line.
Net sales to customers outside of the U.S. for the third quarter ended December 31, 2010 were $1.5 million, a decrease of 5% from $1.6 million in the same quarter last year. Excluding the impact of foreign exchange translation, sales increased by approximately 2%. For the nine months ended December 31, 2010, sales were $4.3 million, a decrease of 2% compared with $4.4 million in the comparable period of the prior year. Excluding the impact of foreign exchange translation, sales increased by approximately 5%.
The operating loss for the fiscal 2011 third quarter was $1.5 million compared with $392,000 in the prior year. The operating loss, excluding non-cash charges for share-based compensation and depreciation and amortization, of $1.1 million in the recent third quarter increased from approximately $42,000 in the year-ago quarter, primarily due to increased spending attributable to higher bonuses, commissions, travel expenses and increase in headcount. The net loss for the three months ended December 31, 2010 was $1.5 million, or $0.07 per share, as compared to a net loss of $387,000, or $0.03 per share, for the quarter ended December 31, 2009.
Cash, cash equivalents and cash investments at December 31, 2010 totaled $20.8 million. Reflected in the total was the contribution from the proceeds of a public offering of common shares in July 2010. The Company issued 4.6 million shares at $3.50 per share, for net proceeds of approximately $14.9 million. The Company plans to use the proceeds to expand the U.S. sales and marketing organizations to support the Urgent PC business, and for clinical studies, working capital and general corporate purposes.
Conference Call Uroplasty will host an audio conference call today at 3:30 pm Central, 4:30 pm Eastern, to review the financial results for the third fiscal quarter ended December 31, 2010. David Kaysen, President and Chief Executive Officer and Medi Jiwani, Vice President, Chief Financial Officer and Treasurer, will host the call. Individuals wishing to participate in the conference call should dial 877-941-8609. An audio replay will be available for 30 days following the call at 800-406-7325 (domestic) or 303-590-3030 (international), with the passcode 4402505.
CPT is a registered trademark of the American Medical Association.
About Uroplasty, Inc. Uroplasty, Inc., headquartered in Minnetonka, Minnesota, with wholly-owned subsidiaries in The Netherlands and the United Kingdom, is a medical device company that develops, manufactures and markets innovative proprietary products for the treatment of voiding dysfunctions. Our focus is the continued commercialization of our Urgent PC system, which we believe is the only FDA-cleared minimally invasive nerve stimulation device designed for office-based treatment of urinary urgency, urinary frequency and urge incontinence – symptoms often associated with overactive bladder.
We also offer Macroplastique Implants, an injectable urethral bulking agent for the treatment of adult female stress urinary incontinence primarily due to intrinsic sphincter deficiency. For more information on the company and its products, please visit Uroplasty, Inc. at www.uroplasty.com.
Forward-Looking Information This press release contains forward-looking statements that reflect our best estimates regarding future events and financial performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our anticipated results. We discuss in detail the factors that may affect the achievement of our forward-looking statements in our Annual Report on Form 10-K filed with the SEC. In particular, we cannot be certain that we will ever achieve sustained profitability, that the rate of reimbursement for PTNS treatments will be adequate to justify the cost of our product, that other Medicare carriers or private payers will provide coverage for this treatment or that existing carriers and payers will not change their coverage decisions, or that any of the other risks identified in our 10-K will not adversely affect our expectations as described in these forward-looking statements.For Further Information: Uroplasty, Inc.
David Kaysen, President and CEO, or
Medi Jiwani, Vice President, CFO, and
952.426.6140 EVC Group
Doug Sherk/Jenifer Kirtland (Investors)
Chris Gale (Media)
646.201.5431 UROPLASTY, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(Unaudited)Three Months EndedNine Months EndedDecember 31,December 31,2010200920102009Net sales
$3,492,067$3,068,142$9,772,389$8,880,546Cost of goods sold
2,887,5012,562,7438,062,6587,288,103Operating expensesGeneral and administrative
861,183639,6082,608,8682,201,199Research and development
423,794401,4811,296,4311,365,194Selling and marketing
(1,479,990)(392,435)(3,352,551)(2,641,037)Other income (expense)Interest income
(652)(1,291)(4,537)(10,986)Foreign currency exchange gain (loss)
--(192)(183)20,98611,84260,90042,898Loss before income taxes
(1,459,004)(380,593)(3,291,651)(2,598,139)Income tax expense
($1,467,931)($386,736)($3,319,911)($2,627,169)Basic and diluted loss per common share
($0.07)($0.03)($0.18)($0.18)Weighted average common shares outstanding:Basic and diluted
20,514,53014,946,54018,314,15714,943,638UROPLASTY, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)December 31, 2010March 31, 2010Assets Current assets:Cash and cash equivalents & short-term investments
$14,822,635 $5,811,269 Accounts receivable, net
592,181341,497Income tax receivable
308,137237,321 Total current assets
17,270,6187,701,347 Property, plant, and equipment, net
1,133,1791,230,771 Intangible assets, net
1,911,8872,533,095 Long-term investments
6,009,337- Deferred tax assets
112,907108,530 Total assets
$26,437,928 $11,573,743 Liabilities and Shareholders’ Equity Current liabilities:Accounts payable
$489,093 $485,594 Current portion – deferred rent
35,00035,000Income tax payable
251,455212,028 Total current liabilities
2,264,2731,645,679 Deferred rent – less current portion
86,079112,500 Accrued pension liability
578,262601,037 Total liabilities
2,928,6142,359,216 Total shareholders’ equity
23,509,3149,214,527 Total liabilities and shareholders’ equity
$26,437,928 $11,573,743 UROPLASTY, INC. AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)Nine Months EndedDecember 31,20102009Cash flows from operating activities:Net loss
($3,319,911)($2,240,434)Adjustments to reconcile net loss to net cash used in operating activities:Depreciation and amortization
848,385 567,238 Loss on disposal of equipment
192 186 Amortization of premium on marketable securities
7,226 - Share-based consulting expense
9,739 - Share-based compensation expense
279,083 291,462 Deferred income taxes
(5,863)(3,249) Deferred rent
(26,421)(17,500)Changes in operating assets and liabilities:Accounts receivable
(248,656)47,499 Other current assets and income tax receivable
4,474 (185,406)Accrued liabilities
610,710 (348,381)Accrued pension liability, net and income tax payable
(10,783)(58,492)Net cash used in operating activities
(2,161,453)(1,958,869)Cash flows from investing activities:Proceeds from maturity of marketable securities
4,000,000 2,500,000 Purchases of marketable securities
(16,311,352)(2,000,000)Purchases of property, plant and equipment
(128,935)(61,334)Purchase of intangible assets
(11,300)- Proceeds from sale of property, plant and equipment
- 2,000 Net cash (used in) provided by investing activities
(12,451,587)440,666 Cash flows from financing activities:Net proceeds from public offering of common stock
14,917,059 - Net proceeds from exercise of warrants and options
2,467,007 - Net cash provided by financing activities
17,384,066 - Effect of exchange rates on cash and cash equivalents
(37,554)34,771 Net increase (decrease) in cash and cash equivalents
2,733,472 (1,483,432)Cash and cash equivalents at beginning of period
2,311,269 3,276,299 Cash and cash equivalents at end of period
$5,044,741 $1,792,867 Supplemental disclosure of cash flow information:Cash paid during the period for interest
$- $6,145 Cash received(paid) during the period for income taxes
9,633 (105,877)Non-GAAP Financial Measures: The following table reconciles our operating loss calculated in accordance with accounting principles generally accepted in the U.S. (GAAP) to non-GAAP financial measures that exclude non-cash charges for share-based compensation, and depreciation and amortization expenses from gross profit, operating expenses and operating loss. The non-GAAP financial measures used by management and disclosed by us are not a substitute for, or superior to, financial measures and consolidated financial results calculated in accordance with GAAP, and you should carefully evaluate our reconciliations to non-GAAP. We may calculate our non-GAAP financial measures differently from similarly titled measures used by other companies. Therefore, our non-GAAP financial measures may not be comparable to those used by other companies. We have described the reconciliations of each of our non-GAAP financial measures described above to the most directly comparable GAAP financial measures.
We use these non-GAAP financial measures, and in particular non-GAAP operating loss, for internal managerial purposes and incentive compensation for senior management because we believe such measures are one important indicator of the strength and the operating performance of our business. Analysts and investors frequently ask us for this information. We believe that they use these measures to evaluate the overall operating performance of companies in our industry, including as a means of comparing period-to-period results and as a means of evaluating our results with those of other companies.
Our non-GAAP operating loss during the three months ended December 31, 2010 and 2009 was approximately $1,059,000 and $42,000, respectively. Our non-GAAP operating loss during the nine months ended December 31, 2010 and 2009 was approximately $2.2 million and $1.4 million, respectively.Three Months EndedNine Months EndedDecember 31,December 31,2010200920102009Gross ProfitGAAP gross profit
$2,887,501$2,562,743$8,062,658$7,288,103% of sales
12,00714,48143,47042,780Non-GAAP gross profit
2,903,6922,581,9958,118,9797,354,101Operating ExpensesGAAP operating expenses
211,057211,189632,508634,505Non-GAAP operating expenses
3,962,7422,624,17610,334,3238,786,185Operating LossGAAP operating loss
211,057211,189632,508634,505Non-GAAP operating loss
|SOURCE Uroplasty, Inc.|
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