TIDMLSI
RNS Number : 1808P
Lifeline Scientific, Inc
30 September 2013
Lifeline Scientific, Inc.
("Lifeline" or the "Company")
Results for the Six Months Ended 30 June 2013
Significant progress in geographical expansion and product
development
Lifeline Scientific, the transplantation technology company,
announces results for the six months ended 30 June 2013. The
results reflect planned investment in developing strategic
geographic markets, expanding its LifePort product line to address
unmet clinical needs, and increased inventory and market access
investments to support new market penetration.
Lifeline is focused on developing technologies to help improve
clinical outcomes and lower overall costs within transplantation.
Its lead product, LifePort(R) KidneyTransporter ('LifePort') is a
clinically proven, market leading renal preservation and transport
system designed to address the global challenge of human donor
organ shortages.
Financial Highlights
-- Transplantation products and services revenues of US$13.2m (H1 2012: US$13.7m)
-- US$12.2m of revenue from sales of single use consumable items
(H1 2012: US$13.2m)
o Intemperate seasonal weather in the Company's largest regional
market, Eastern US, reduced organ recovery activity during the
period, while importation permit delays in Brazil slowed revenue
realisation of booked backlog
o During the period, the Company gained 14 new accounts and
pricing remained comparable to H1 2012.
-- Revenue outside North America up 18% to US$2.7m (H1 2012:
US$2.3m)
-- Gross margin of 55.4% (H1 2012: 61.0%) - reduced as a consequence of product mix
-- Operating loss of US$1.4m (H1 2012: US$0.2m loss)
-- Net cash used in operating activities of US$1.8m (H1 2012: US$0.2m generated)
-- Basic loss per share of US$0.07 (H1 2012: US$0.02 loss)
-- Cash of US$3.0m as at 30 June 2013 (As at 31 December 2012: US$ 5.7m)
Operational Highlights
Expanding to new markets
-- Increased adoption of LifePort Kidney Transporter; 155
transplant programmes in 25 countries now employing LifePort (up
from 141 at year end 2012)
Strategic Europe
-- CE mark certification issued for the all new LifePort Kidney
Transporter 1.1; innovations include embedded GPS/GPRS,
state-of-the-art controls, and rapid data downloading
-- French transplant authorities concluded an extensive
clinical, logistical and technical review of LifePort 1.1, and
selected the Company to participate in the French health ministry's
national tender for machine preservation technology
-- Negotiations progressed for Germany health ministry funded,
national LifePort reimbursement study
Brazil
-- Booked order backlog in Brazil reached US$1.9m. Over 200
renal transplant procedures performed in Brazil with LifePort at
six leading transplant centres including the prestigious Albert
Einstein Hospital and Hospital Rim, the worlds largest volume renal
transplant venue
-- Positive outcomes reported vs. ice-boxed kidneys; significant
reductions in delayed graft function observed
-- LifePort cleared to travel as unattended air cargo while
fully operational by Brazil's leading commercial carrier TAM,
adding to the list of approved international carriers including Air
France, KLM, Lufthansa, and Brussels Airlines, among others
China
-- Positive outcomes reported from the inaugural multi-centre
100 patient China health ministry funded LifePort feasibility
study; Chinese regulatory clearance progressing for full suite of
LifePort and related products
-- 13 transplant programmes in China now using LifePort; over
300 LifePort preserved kidneys successfully transplanted to
date.
New Clinical Evidence
-- Expanding body of scientific evidence supports clinical adoption of LifePort
-- Adding to an extensive list of publications, six new peer
reviewed medical journal articles were published during the period,
citing important benefits of machine preservation for kidneys vs.
traditional ice-box storage; three year outcomes data shows
significant benefits in Expanded Criteria ('ECD') Kidneys
New Products
-- New Seal Ring Cannula with innovative ease-of-use features
successfully launched and well received by clinicians; enables
broader range of renal vascular access and LifePort
connectivity
-- LifePort Liver Transporter commercial prototype showcased at
the American Transplant Congress in May with favourable reception;
initial cost effectiveness study suggests potential economic
benefits
-- In September, the US National Science Foundation (NSF)
awarded Lifeline's joint-venture partner Glucosentient, Inc.,
(GSI), US$750,000, Phase II Small Business Innovation Research
Grant for the development of a novel device for convenient
(point-of-use), therapeutic drug monitoring of tacrolimus, the
market leading drug indicated for post transplant life-long
immunosuppression. Lifeline Scientific has secured exclusive
worldwide rights for this technology in transplant medicine
New Patents
-- 24 new patents issued covering LifePort organ perfusion
technology and cell and tissue preservation innovations; The
Company's IP portfolio now includes 140 issued and 153 pending
patents
David Kravitz, Chief Executive Officer of Lifeline, said:
"Achievements during the first half of 2013 strengthened the
Company's foundation for continued geographic and product line
growth. These have been cornerstone initiatives of our last 18
months, commanding significant investment of capital and management
resources aimed at accelerating revenues, profitability and
shareholder value. Several key milestones were met in the period
which should enable expansion of the installed base of LifePorts in
key growth territories, namely within the EU, Brazil, and China and
provide an expanded base for driving sales of single use
consumables. The growing body of clinical evidence in support of
LifePort adoption combined with continued product innovations
driven by our careful listening to clinician, patient and payor
needs, will be pivotal to our ongoing success. Although sales
revenues are slightly below this period last year, we anticipate
that the results for the year to 31 December 2013 will be broadly
in line with market expectations, as worldwide revenue trends for
disposables should favour second half performance. "
For further information please contact:
Lifeline Scientific, Inc. www.lifeline-scientific.com
David Kravitz, CEO +1 847 294 0300
Panmure Gordon (Nominated Adviser
and Broker) +44 (0)20 7886 2500
Fred Walsh / Freddy Crossley (Corporate
Finance)
Adam Pollock (Corporate Broking)
Walbrook PR +44 (0)20 7933 8780 or lifeline@walbrookpr.com
Paul McManus +44 (0)7980 541 893
Mike Wort +44 (0)7900 608 002
About Lifeline Scientific Inc.
Lifeline Scientific, Inc. is a Chicago-based global medical
technology company with regional offices in Brussels and Sao Paulo.
The Company's focus is the development of innovative products that
improve transplant outcomes and lower the overall costs of
transplantation. Its lead product is the market-leading and
clinically validated LifePort Kidney Transporter. Devices for
preservation of the liver, pancreas, heart and lung are in late
stage pre-clinical development. Also visit: www.organ-recovery.com
and www.cellandtissuesystems.com
About LifePort Kidney Transporter
Created with the challenges of organ recovery and transport in
mind, LifePort Kidney Transporter is a proprietary medical device
designed to provide improved kidney preservation, evaluation and
transport prior to transplantation. Today, it is widely recognised
as the world's leading machine preservation device for kidneys.
Employed by surgeons in over 150 leading transplant programmes in
25 countries worldwide, LifePorts have successfully preserved over
45,000 kidneys indicated for clinical transplant. The product
provides a sealed, sterile, protected environment where a solution
is gently pumped through the kidney at cold temperatures to
minimise damage while the organ is outside the body. LifePort is
lightweight and portable, allowing organs to be perfused from the
time of recovery until transplant. It is designed to travel
unaccompanied by land or air, safely transporting the kidneys
across town or between countries. While the kidney is being
perfused, LifePort records data on temperature, flow rate, vascular
resistance and pressure every 10 seconds providing surgeons with
additional data prior to transplant. LifePort is the only system
with clinical outcomes data produced from an independent,
prospective, randomised, statistically powered, multi-centre
clinical trial. Study results have been widely published in
scientific journals, including the New England Journal of Medicine.
Data indicates that patients receiving LifePort preserved kidneys
experienced significant reduction in the incidence and duration of
delayed graft function and increased graft survival at 1-year and
3-years post-transplant. LifePort has also been recognised for
design and engineering distinctions. It has received prominent
awards for design excellence from the medical device industry, has
been selected for exhibition at the Smithsonian Cooper-Hewitt
National Design Museum and is part of the permanent Collection of
The Museum of Modern Art (MoMA) in New York City.
Chairman's Statement
This period has been one of strengthening for the Company,
having met several important new market and product development
milestones. We are confident that we have established the basis for
solid growth in the second half of the year and into 2014.
Overall revenue from transplantation products was US$13.2m (H1
2012: US$13.7m), slightly down from last year. This was due to a
reduction in sales in the US, primarily as a result of harsh late
Winter/Spring weather conditions causing a slow-down in donor organ
recovery in the Eastern US where a significant number of our key
customers are situated. Brazil import permitting delays has also
resulted in slower revenue recognition from our booked order
backlog. This was offset by improved revenues outside of the US,
which increased by 18% to US$2.7m (H1 2012: US$2.3m).
US$12.2m of worldwide revenue stemmed from sales of single use
consumable items (H1 2012: US$13.2m). LifePort was adopted for
machine preservation by 14 new transplant programmes during the
period including several of the world's largest volume centres.
The installed base is now 534 LifePorts at 155 transplant
centres in 25 countries. (H1 2012: 462 installed base), which we
anticipate will lead to increased sales of the higher margin single
use consumable items during the second half. The adoption of
LifePort in leading transplant programmes within Brazil and China
along with excellent progress made establishing our presence in
France and Germany was particularly encouraging. These markets
offer significant opportunities for near and long term growth for
all our existing products and those in development.
Gross margin decreased to 55.4% (H1 2012: 61%) primarily as a
consequence of the product mix as we sold a higher proportion of
lower margin flush and preservation solutions and LifePorts than
proprietary single-use consumables in this period over H1 2012.
The operating loss for the period of US$1.4m (H1 2012: US$0.2m),
reflects the previously flagged and planned investment in strategic
geographic expansion and LifePort product line extension to address
unmet clinical needs in other organs, most notably LifePort Liver
Transporter. I am delighted to report that the LifePort Liver
Transporter commercial prototype was received very favorably when
showcased at the American Society of Transplantation in May, which
is the largest annual gathering of transplant professionals
worldwide.
Net cash used in operating activities came to US$1.8m (H1 2012:
US$0.2m generated). US$1.1m of the cash used was invested to expand
inventory in support of emerging and growing markets in Europe,
China and Brazil and expected future regulatory and reimbursement
approvals in major geographic markets. Basic loss per share of
US$0.07 (H1 2012: US$0.02 loss). Cash at the period end was US$3.0m
(As at 31 December 2012: US$ 5.7m).
During the six months ended 30 June 2013, the Company settled a
dispute with a third party. Under the settlement, the Company is
owed US$1.0m, payable through April 2015. The Company has
recognised the settlement amount as a reduction to selling,
general, and administrative expenses in the consolidated statements
of operations. As of 30 June 2013, the Company has received
payments of US$163,043 related to this settlement.
John Garcia
Chairman
30 September 2013
Chief Executive Officer's review
We were very pleased to see progress in LifePort adoption within
our newly targeted geographic markets. 14 new transplant programmes
purchased LifePort as their machine preservation technology for
clinical kidney transplantation. Regulatory and reimbursement
efforts in several of these key markets also progressed to a level
suggesting our strategic investments over the last 18 months in
developing regional growth markets are starting to show positive
movement. In parallel, we achieved important milestones in the
planned development of new products and market driven enhancements
to several of our existing products.
Expanding to New Markets
Strategic Europe
Market access negotiations in Germany advanced measurably during
the period, creating an opportunity for LifePort Kidney
Transporter's potential placement during late 2013/early 2014.
Germany is one of the EU's top three potential national markets for
LifePort. This negotiation aims to establish contract terms and a
clinical protocol for Germany's formal evaluation of LifePort
reimbursement. The contemplated evaluation process includes a
health ministry funded nationwide study focusing on Expanded
Criteria Donor (ECD) kidneys. Negotiations are targeted for
completion within Q413 and if successful, investigators should be
in position to start study enrollment early in the Q114.
During the period,CE mark certification was awarded for the all
new LifePort Kidney Transporter 1.1. Novel features of this new
LifePort include embedded GPS/GPRS, state-of-the-art controls, and
rapid data downloading.
Following CE certification French transplant authorities
concluded an extensive clinical, logistical and technical review of
LifePort 1.1, and selected the Company to participate in the French
health ministry's national tender for machine preservation
products. With the health ministry having recently established
reimbursement criteria for machine preservation, the tender
invitation is a significant development for Lifeline Scientific as
France is also one of the top three potential markets for LifePort
within the EU. To date, Lifeport has been adopted at 17 leading
transplant centres throughout France as a standard of care for
preservation of kidneys from non-heart beating donors.
Brazil
Brazil represents another significant market opportunity for the
Company. Having gained ANVISA regulatory approval for commercial
sale of our full suite of products mid 2012, positive momentum
continues to build. Booked order backlog in Brazil reached US$1.9m
during the first half of 2013. While order backlog is substantial
and growing, before product may be shipped and revenue recognised
for each order placed,each individual transplant centre client must
apply for and receive special Brazil government importation and
related permits in order to complete their purchase. This
bureaucratic process has been lengthy and timing is unpredictable.
Lifeline Scientific has recently taken measures to help its Brazil
clients improve their import documentation processing.
Brazil reports over 2400 kidney transplants annually from
cadaveric donors, significant demand for transplantation driven by
rapidly growing end stage renal disease, and claims it has among
the highest rates of delayed (renal) graft function ('DGF') in the
world. DGF is a known predictor of significant post transplant
medical complications and added costs. To date, over 200 LifePort
preserved kidneys have been transplanted in Brazil at six leading
transplant centres including the prestigious Albert Einstein
Hospital and Hospital Rim, the world's largest volume renal
transplant venue. Clinicians have reported positive outcomes vs.
ice-boxed kidneys with very significant reductions in DGF routinely
observed.
Additionally, LifePort was recently cleared to travel as
unattended air cargo while in full operational mode by Brazil's
national airline, TAM. This clearance adds to LifePort's list of
approved international commercial carriers including Air France,
KLM, Lufthansa, and Brussels Airlines, among others.
China
Another key market for Lifeline is China. With 165 licensed
renal transplant hospitals, and staggering growth reported in end
stage renal disease, China is positioned to become the world's
largest potential national market for transplant related products.
Presently, the nation is shifting its organ donation and recovery
practices to a Western styled system, and significant growth in
donation of kidneys indicated for LifePort is occurring.
We have invested considerable time and effort setting up key
distributor and transplant centre relationships and now have 13
major transplant hospitals in China fully-trained and starting to
employ LifePort in their clinical practice. Positive outcomes have
been reported from the inaugural multi-centre 100 patient China
health ministry funded LifePort feasibility study, with further
study results anticipated later this year. To date, over 300
LifePort preserved kidneys have been reported as successfully
transplanted.
In parallel, Chinese regulatory applications for our full suite
of LifePort and related products are progressing. Regulatory
approval timing is unpredictable. As full commercial market launch
of LifePort Kidney Transporter in China awaits such approvals, the
Company remains optimistic these will come within the first half of
2014.
Supporting Growth
In support of anticipated sales growth from the above described
market activities and overall momentum, US$1.8m of net cash was
used for operating activities, primarily in the building of
inventory, product development, and financing national level
regulatory, reimbursement and other market access efforts.
New Clinical Evidence
We were pleased to see the extensive body of scientific
publications providing clinical and economic evidence in support of
hypothermic machine preservation continuing to grow. During the
period, six new articles were published in peer reviewed journals
citing important benefits of machine preservation for kidneys vs.
traditional ice-box storage.
Notably, those articles included new data from the landmark
European Machine Preservation Trial, an independent,
multi-national, randomised, controlled trial comparing outcomes of
LifePort machine preserved kidneys with the traditional method of
static cold storage (ice-box preservation). Among many important
findings, study results demonstrated a significant long term
benefit for organ survival following the use of LifePort in
expanded criteria donor kidney ('ECD') transplantation. ECDs
represent the largest and fastest growing segment of the donor
population in Western nations. This three year follow up data was
published in the March, 2013 edition of Transplant International.
Three year organ survival data for statically stored ECD kidneys
with Delayed Graft Function was 32.9% compared with 68.7% in
kidneys preserved on LifePort. This is markedly significant data
further supporting LifePort adoption for routine clinical use.
New Product Innovations
We are also very pleased to report that the LifePort Liver
Transporter ('LLT') commercial prototype received favorable reviews
in its US debut at the American Transplant Congress in May.
Regulatory registrations and commercial roll out of this product
are strategically important to the Company and command priority
attention. Regulatory registration of the LifePort Liver
Transporter is underway for both the US and EU and commercial
launch remains anticipated in 2014.
Based upon initial clinical results reported from investigator
driven controlled studies on early LLT prototypes conducted at New
York's Columbia Medical University, LLT could represent a
significant advancement in liver preservation. Potential benefits
include improving patient outcomes and lowering the overall cost of
transplantation. Published clinical data suggests our machine
perfusion technology could also help enable the successful recovery
of livers otherwise deemed not transplantable while saving costs
vs. ice box stored livers.
An investigator driven economic cost analysis of the initial
Columbia University perfused liver transplant studies has been
accepted for presentation at forthcoming transplant society
meetings in the US. This head to head analysis has shown a
statistically significant cost savings with machine perfused livers
vs. those stored using the conventional ice box method. Albeit
preliminary single centre data, the initial economic results appear
promising.
Our new Seal Ring Cannula with innovative ease-of-use features
was successfully launched and gave rise to favourable reviews from
transplant surgeons. Initial observations suggest the new cannula
allows a broader range of renal vascular access and LifePort
connectivity. This invention also uniquely enables LifePort use
with living donor kidneys, a potential new market.
Early in the year Lifeline partnered with Illinois based
Glucosentient, Inc. ('GSI'), to develop novel point- of-care assays
for monitoring of transplant drug levels in patients and ex vivo
biomarkers of an organ's health while undergoing LifePort machine
preservation. This September, the US National Science Foundation
(NSF) awarded GSI a US$750,000 Phase II Small Business Innovation
Research Grant for the development of a novel device for convenient
(point-of-use), therapeutic drug monitoring of tacrolimus, the
market leading drug for post transplant life-long
immunosuppression. Lifeline has exclusive worldwide rights for this
technology in transplant medicine.
New Patents
Intellectual property protection is important to the long-term
well being of the Company and significant care is taken in
identifying and protecting relevant proprietary innovations. During
the period 24 new patents issued covering LifePort organ perfusion
technology and cell and tissue preservation innovations; The
Company's IP portfolio now includes 140 issued and 153 pending
patents.
Outlook
Achievements during the first half of 2013 strengthened the
Company's foundation for continued geographic and product line
growth. Several key milestones were met in the period which should
enable expansion of the installed base of LifePorts in key growth
territories and provide a solid base for driving sales of single
use consumables. We expect the growing body of clinically relevant
evidence in support of LifePort adoption combined with continued
product innovations driven by careful listening to clinician,
patient and payor needs will be pivotal to our ongoing success. We
continue to trade in line with market expectations for the year to
31 December 2013.
David Kravitz
Chief Executive Officer
30 September 2013
LIFELINE SCIENTIFIC, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
30 June 2013 and 2012
(In U.S. Dollars unless otherwise noted)
UNAUDITED
2013 2012
Current Assets
Cash and cash equivalents $ 3,038,639 $ 8,310,110
Receivables
Customers (net of allowance for
doubtful accounts of $2,673
and $2,572 as of 30 June 2013 and
2012, respectively) 3,990,003 3,902,345
Employee - 7,532
Grant 94,910 69,502
Deferred tax assets 16,285 16,285
Income taxes receivable 85,569 199,204
Inventories 5,464,444 2,426,765
Prepaid expenses, deposits, and other 1,508,191 2,043,747
------------- -------------
Total Current Assets 14,198,041 16,975,490
Non-current Assets
Property and equipment (net of accumulated
depreciation
and amortisation) 2,580,743 2,202,552
Intangibles (net of accumulated amortisation) 3,081,548 2,668,251
Deferred tax assets 1,023,400 1,023,400
Goodwill 64,710 64,710
Other 498,575 117,535
------------- -------------
Total Non-current Assets 7,248,976 6,076,448
------------- -------------
Total Assets $ 21,447,017 $ 23,051,938
=== ============= =============
Current Liabilities
Accounts payable $ 2,382,660 $ 2,497,610
Long-term debt due within one year 260,958 181,568
Capital lease obligations due within
one year 3,760 22,356
Accrued expenses
Interest due within one year 48,553 77,793
Salaries and other compensation 638,567 576,218
Other 812,698 1,403,835
Deferred rent 138,363 44,989
Deferred revenue 257,949 133,783
------------- -------------
Total Current Liabilities 4,543,508 4,938,152
Non-current Liabilities
Long-term debt (net of portion included
in current liabilities) 1,009,489 1,238,120
Deferred rent (net of portion included
in current liabilities) 248,917 110,975
Accrued interest (net of portion
included in current liabilities) 237,697 207,905
Capital leases (net of portion included
in current liabilities) 2,626 17,370
------------- -------------
Total Non-current Liabilities 1,498,729 1,574,370
Total Liabilities 6,042,237 6,512,522
------------- -------------
Stockholders' Equity
Common stock, $0.01 par value; authorised
- 30,000,000
shares; issued and outstanding -
and 19,424,959
shares as of 30 June 2013 and 2012,
respectively $ 194,249 $ 194,249
Additional paid-in capital 94,174,078 93,916,337
Other accumulated comprehensive loss (290,721) (263,948)
Accumulated deficit (77,671,782) (76,541,399)
Total Lifeline Scientific, Inc. Stockholders'
Equity 16,405,824 17,305,239
============= =============
Non-controlling interest (1,001,044) (765,823)
Total Stockholders' Equity 15,404,780 16,539,416
Total Liabilities and Stockholders'
Equity $ 21,447,017 $ 23,051,938
=== ============= =============
The accompanying notes are an integral part of the consolidated
financial statements.
LIFELINE SCIENTIFIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Six months ended 30 June 2013 and 2012
(In U.S. Dollars unless otherwise noted)
UNAUDITED
2013 2012
Net revenue
Product sales and service fee revenue $ 13,194,065 $ 13,680,446
Grant revenue 396,594 609,178
------------ -----------
Total net revenue 13,590,659 14,289,624
Cost of revenue 6,061,712 5,572,040
------------ -----------
Gross profit 7,528,947 8,717,584
------------ -----------
Gross profit percentage 55.4% 61.0%
Operating expenses
Research and development 1,786,108 1,515,359
Selling, general, and administrative 7,178,011 7,377,081
Loss from disposal of property and equipment - 47,639
Loss from abandonment of intangibles 5,597 9,052
------------ -----------
Total operating expenses 8,969,716 8,949,131
------------ -----------
Loss from operations (1,440,769) (231,547)
------------ -----------
Other expense (income)
Interest expense 49,170 45,863
Interest income (3,857) (2,309)
------------ -----------
Total other expense 45,313 43,554
------------ -----------
Loss before income taxes (1,486,082) (275,101)
Income tax (benefit) expense (72,236) 236,825
------------ -----------
Net loss (1,413,846) (511,926)
Less: net loss attributable to non-controlling interest 101,237 118,856
------------ -----------
Net loss attributable to Lifeline Scientific, Inc. $ (1,312,609) $ (393,070)
=== ============ ===========
Basic loss per share $ (0.07) $ (0.02)
Diluted loss per share* $ (0.07) $ (0.02)
Basic weighted average shares outstanding (in shares) 19,424,959 19,424,959
Diluted weighted average shares outstanding (in shares) 19,424,959 19,424,959
* Diluted loss per share is the same as basic loss per share
because the effects of potentially dilutive
securities are anti-dilutive.
The accompanying notes are an integral part of the consolidated
financial statements.
LIFELINE SCIENTIFIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
Six months ended 30 June 2013 and 2012
(In US Dollars unless otherwise noted)
UNAUDITED
2013 2012
$ (1,413,846)
Net loss (40,438) $ (511,926)
(1,454,284) (7,917)
Foreign currency translation (101,237)
$ (1,353,047) (519,843)
Comprehensive loss
(118,856)
Comprehensive loss attributable to
non-controlling interest $ (400,987)
Comprehensive loss attributable to
Lifeline Scientific, Inc
The accompanying notes are an integral part of the consolidated
financial statements.
LIFELINE SCIENTIFIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
EQUITY
Six months ended 30 June 2013 and 2012
(In US Dollars unless otherwise noted)
UNAUDITED
Other
Additional Accumulated Non-
Par Paid-in Comprehensive Accumulated Controlling
Total Shares Value Capital Loss Deficit Interest
------------ ----------- ----------- ------------- -------------- --------------- ---------------
Balance, 1
January 2012 $ 16,929,903 19,424,959 $ 194,249 $93,786,981 $ (256,031) $(76,148,329) $ (646,967)
Stock-based
compensation 129,356 - - 129,356 - - -
Foreign currency
translation (7,917) - - - (7,917) - -
Net loss (511,926) - - - - (393,070) (118,856)
------------ ----------- ----------- ------------- -------------- --------------- ---------------
Balance, 30
June 2012 $ 16,539,416 19,424,959 $ 194,249 $93,916,337 $ (263,948) $ (76,541,399) $ (765,823)
============ =========== =========== ============= ============== =============== ===============
Balance, 1
January 2013 $ 16,730,465 19,424,959 $ 194,249 $94,045,479 $ (250,283) $(76,359,173) $ (899,807)
Stock-based
compensation 128,599 - - 128,599 - - -
Foreign currency
translation (40,438) - - - (40,438) - -
Net loss (1,413,846) - - - - (1,312,609) (101,237)
------------ ----------- ----------- ------------- -------------- --------------- ---------------
Balance, 30
June 2013 $ 15,404,780 19,424,959 $ 194,249 $94,174,078 $ (290,721) $ (77,671,782) $ (1,001,044)
============ =========== =========== ============= ============== =============== ===============
The accompanying notes are an integral part of the consolidated
financial statements.
LIFELINE SCIENTIFIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Six months ended 30 June 2013 and 2012
(In US Dollars unless otherwise noted)
UNAUDITED
2013 2012
Cash flows from operating activities
Net loss $ (1,413,846) $ (511,926)
Adjustments to reconcile net loss to
net cash (used in)
provided by operating activities:
Depreciation and amortisation of property
and equipment 364,622 233,127
Amortisation of intangibles 64,973 43,994
Settlement related to dispute with
third party (836,957) -
Stock-based compensation 128,599 129,356
Loss on disposal of property and equipment - 47,639
Loss on abandonment of intangibles 5,597 9,052
(Increase) decrease in:
Receivables 1,417,219 (31,860)
Inventories (1,058,133) (410,376)
Prepaid expenses and deposits 9,953 (1,067,829)
Other assets (315,004) (24,417)
Increase (decrease) in:
Accounts payable 64,066 1,170,406
Accrued expenses (94,309) 507,400
Accrued interest (40,731) 39,961
Deferred revenue (48,510) 90,295
Deferred rent (19,079) (22,094)
------------------------ -------------------------
Total adjustments (357,694) 714,654
------------------------ -------------------------
Net cash (used in) provided by operating
activities (1,771,540) 202,728
Cash flows from investing activities
Payments of legal fees associated with
patent filings (339,298) (490,384)
Capital expenditures (446,543) (1,201,918)
------------------------ -------------------------
Net cash used in investing activities (785,841) (1,692,302)
Cash flows from financing activities
Repayments under capital lease obligations,
net (22,532) (21,596)
Borrowings of long-term debt - 525,000
Principal payments of long-term debt (87,500) (48,018)
------------------------ -------------------------
Net cash (used in) provided by financing
activities (110,032) 455,386
------------------------ -------------------------
Effect of foreign currency exchange
rate changes on cash (40,354) (8,182)
Net decrease in cash and cash equivalents (2,707,767) (1,042,370)
Cash and cash equivalents, beginning
of period 5,746,406 9,352,480
------------------------ ---- -------------------------
Cash and cash equivalents, end of period $ 3,038,639 $ 8,310,110
=== ======================== ==== =========================
The accompanying notes are an integral part of the consolidated
financial statements.
LIFELINE SCIENTIFIC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
30 June 2013 and 2012
(In US Dollars unless otherwise noted)
UNAUDITED
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General: The accompanying condensed consolidated financial
statements of Lifeline Scientific, Inc. (the "Company") are
unaudited and do not include all of the footnotes required by
accounting principles generally accepted in the United States of
America ("US GAAP"). These statements should be read in conjunction
with the Company's annual report as of and for the year ended 31
December 2012.
Principles of Consolidation: The Company was incorporated in the
state of Delaware as Organ Recovery Systems, Inc. on 1 October
1998. On 20 December 2007, the Company changed its name to Lifeline
Scientific, Inc. The Company is consolidated with the following
subsidiaries:
ORS Europe, NV (1)
Cell and Tissue Systems, Inc. (2)
Organ Recovery Systems, Inc. (1)
ORS Representacoes do Brasil LTDA (1)
(1) A wholly-owned subsidiary
(2) 49% owned
Intercompany balances and transactions have been eliminated in
consolidation.
The Consolidation Topic of US GAAP requires consolidation by the
primary beneficiary where the variable interest entity does not
have sufficient equity at risk to finance its activities without
additional subordinated financial support from other parties. The
application of this guidance resulted in the consolidation of Cell
and Tissue Systems, Inc. ("CTS"), which was created during the year
ended 31 December 2005 and was deemed to be a variable interest
entity. CTS was primarily formed to meet regulatory requirements in
order to enhance its ability and capacity to apply for funding from
available government sources. The Company contributed $490 for the
49% ownership needed to form the variable interest entity. CTS has
an accumulated deficit as of 30 June 2013 and 2012.
In accordance with the requirements of the accounting standard
under US GAAP that establishes accounting and reporting standards
for non-controlling interests in a subsidiary in consolidated
financial statements, the Company classifies the non-controlling
interest of CTS within the equity section of the consolidated
balance sheets and separately reports the amounts attributable to
controlling and non-controlling interests in the consolidated
statements of operations for all periods presented.
Cash and Cash Equivalents: The Company considers all money
market accounts and short-term investments with an original
maturity of three months or less and US Treasury money markets to
be cash equivalents. The majority of cash and cash equivalents as
of 30 June 2013 and 30 June 2012 were held through a single
financial institution, and the balances held at times may exceed
federally insured limits. The Company has not experienced any
losses in such accounts. The Company believes it is not exposed to
any significant credit risk on cash and cash equivalents.
Receivables: Receivables are carried at original invoice or
closing statement amount less estimates made for doubtful
receivables. Management determines the allowance for doubtful
accounts by reviewing and identifying troubled accounts on a
monthly basis and by using historical experience applied to an
aging of accounts. A receivable is considered to be past due if any
portion of the receivable balance is outstanding for more than 90
days. The Company does not charge interest on past due receivables.
Receivables are written off when deemed uncollectible. Recoveries
of receivables previously written off are recorded when
received.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Inventories: Inventories are valued at the lower of cost
(first-in, first-out) or market.
Depreciation and Amortisation: The Company's policy is to
depreciate or amortise the cost of property and equipment over the
estimated useful lives of the assets using the straight-line
method. The cost of leasehold improvements is amortised over the
estimated useful lives, or the applicable lease term, if
shorter.
Years
Computer equipment 3-5
Furniture and fixtures 5-7
Equipment under capital
lease 5-7
Laboratory equipment 3-7
Leasehold improvements 5-8
Tooling and moulds 1-15
Vehicles 5
Long-Lived Assets: Long-lived assets to be held are reviewed for
events or changes in circumstances that indicate that their
carrying value may not be recoverable. The Company periodically
reviews the carrying value of long-lived assets to determine
whether or not an impairment to such value has occurred. Management
believes that no impairment of long-lived assets exists as of 30
June 2013 and 2012.
Intangibles: The cost of intangible assets is being amortised
over the remaining lives of the assets acquired as follows:
Years
Patents 17
Licensing agreement 10
Legal fees associated with filings for patents that are pending
are capitalised if management believes that it is probable that
such patent applications will be successful. Patent costs are not
amortised until the patent is obtained. During the year ended 31
December 2010, the Company signed an agreement that allows for the
licensing of technology to support the Company's product
development efforts. The agreement is being amortised over the
remaining estimated life of the licensed technology, or ten
years.
Goodwill: Goodwill results from business acquisitions and
represents the excess of the purchase price over the fair value of
acquired tangible assets and liabilities and identifiable
intangible assets. In accordance with accounting for goodwill under
US GAAP, goodwill is not amortised, but instead tested for
impairment on an annual basis. The Company has applied Financial
Accounting Standards Board ("FASB") Accounting Standards Update
("ASU") No. 2011-08, "Testing Goodwill for Impairment", in
connection with the performance of the annual goodwill impairment
test. Under FASB ASU 2011-08, entities are provided with the option
of first performing a qualitative assessment on none, some, or all
of its reporting units to determine whether further quantitative
impairment testing is necessary. An entity may also bypass the
qualitative assessment for any reporting unit in any period and
proceed directly to the quantitative impairment test. Goodwill must
be tested on an annual basis or if an event occurs or circumstances
change that would more likely than not reduce the fair value of the
reporting unit below its carrying amount. During the year ended 31
December 2012, the Company was not required to record any
impairments to the carrying value of goodwill or indefinite-lived
intangible assets. During the six months ended 30 June 2013 and
2012, the Company identified no events or circumstances that would
trigger an interim assessement of goodwill.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Deferred Rent: Minimum rent expense is recognised over the term
of the lease. The Company recognises minimum rent starting when
possession of the property is taken from the landlord. When a lease
contains a predetermined fixed escalation of the minimum rent, rent
expense is recognised on a straight-line basis. Any difference
between the recognised rent expense and the amounts payable under
the lease is reported as deferred rent in the consolidated balance
sheets. The Company records include a tenant allowance on its
facility lease in Itasca, Illinois, which is recorded as a
component of deferred rent and amortised as a reduction to rent
expense over the term of the lease. Future payments for common area
maintenance, insurance, real estate taxes, and other occupancy
costs to which the Company is obligated are excluded from minimum
lease payments.
Fair Value of Financial Instruments: US GAAP defines fair value
as the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction between market
participants as of the measurement date. US GAAP describes three
approaches to measuring the fair value of assets and liabilities:
the market approach, the income approach, and the cost approach.
Each approach includes multiple valuation techniques. US GAAP does
not prescribe which valuation technique should be used when
measuring fair value, but does establish a fair value hierarchy
that prioritises the inputs used in applying the various
techniques. Inputs broadly refer to the assumptions that market
participants use to make pricing decisions, including assumptions
about risk. Level 1 inputs are given the highest priority in the
hierarchy while Level 3 inputs are given the lowest priority.
Assets and liabilities carried at fair value are classified in one
of the following three categories based on the nature of the inputs
to the valuation technique used:
Level 1 - Observable inputs that reflect unadjusted quoted
prices for identical assets or liabilities in active markets as of
the reporting date. Active markets are those in which transactions
for the asset or liability occur in sufficient frequency and volume
to provide pricing information on an ongoing basis.
Level 2 - Observable market-based inputs or unobservable inputs
that are corroborated by market data.
Level 3 - Unobservable inputs that are not corroborated by
market data. These inputs reflect management's best estimate of
fair value using its own assumptions about the assumptions a market
participant would use in pricing the asset or liability.
The carrying values of cash and cash equivalents, accounts
receivable, and accounts payable approximates their fair values
because of the short-term nature of these instruments. The carrying
value of long-term debt approximates their fair values as the
stated interest rates approximate current market interest rates of
long-term debt with similar terms.
Product Warranty: Estimated future costs applicable to products
sold under warranty are charged to expense in the year of sale and
the related liability is classified as current. The accrued
warranty liability as of 30 June 2013 and 2012 was $140,577 and
$137,191, respectively.
Revenue Recognition: Product sales revenue is recognised upon
shipment of product to the client. Service fee revenue is
recognised when services are performed. Deferred and unbilled
revenue is recognised in the consolidated balance sheets.
Grant revenue is recognised when earned. Grant revenues are
deemed earned to the extent of the total allowable expenditures
incurred, which are specified in the grant contract. In some cases,
a portion of the grant revenue is paid at the time the grant is
initiated. These advances are deferred and recognised using the
proportional performance model. Unbilled services are at times
recorded for revenue recognised to date and relate to amounts that
are currently unbillable to the client pursuant to contractual
terms.
The Company sells extended warranties on its LifePort product
for a specific period of months. This revenue is deferred and
recognised over the term of the warranties on a straight-line
basis.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Shipping and Handling Costs: Shipping and handling costs billed
to customers of $75,467 and $91,806 are netted with expense and
have been included in cost of sales on the consolidated statements
of operations during the six months ended 30 June 2013 and 2012,
respectively.
Income Taxes: Income taxes are provided for the tax effects of
transactions reported in the consolidated financial statements and
consist of taxes currently due plus deferred taxes related
primarily to differences between the basis of property and
equipment, bad debts, intangibles, and accrued expenses for
financial and income tax reporting. The deferred tax assets and
liabilities represent the future tax return consequences of those
differences, which will either be taxable or deductible when the
assets and liabilities are recovered or settled. The carrying value
of the Company's deferred tax assets is dependent upon its ability
to generate sufficient taxable income in the future. The Company
has established a valuation allowance against its net deferred tax
assets to reflect the uncertainty of realising the deferred tax
benefits, given historical losses and limited history of current
earnings. A valuation allowance is required when it is more likely
than not that all or a portion of a deferred tax asset will not be
realised. During the year ended 31 December 2011, approximately
$1,040,000 of the valuation allowance was reversed to reflect the
likelihood of future taxable income, which will most likely result
in the utilisation of a portion of the Company's net operating
losses. During the periods ended 30 June 2013 and 2012, the Company
determined no change to this estimate was required.
The Company is subject to US federal, state, and local taxes as
well as foreign taxes in Belgium and Brazil. The Company's tax
years, for US federal and state jurisdictions extending back to the
year ended 31 December 2008, and for foreign jurisdictions
extending back to the year ended 31 December 2009, remain open to
examination. The Company's policy is to recognise interest and
penalties related to uncertain tax positions as a component of tax
expense. During the six months ended 30 June 2013 and 2012, the
Company did not recognise expense for interest and penalties. As of
30 June 2013 and 2012, the Company had $94,000 and $0,
respectively, accrued for the payment of interest and penalties.
The Company does not expect the total amount of unrecognised tax
benefits to significantly change during the next 12 months.
The Company's consolidated financial statements provide for any
related US tax liabilities on earnings of foreign subsidiaries that
may be repatriated, aside from qualifying undistributed earnings of
certain foreign subsidiaries that are indented to be indefinitely
reinvested in operations outside of the US.
The Company accounts for unrecognised tax benefits in accordance
with US GAAP, which prescribes a more likely than not threshold for
consolidated financial statement presentation and measurement of a
tax position taken or expected to be taken in a tax return. A tax
position is recognised as a benefit only if it is "more likely than
not" that the tax position would be sustained in a tax examination,
with a tax examination being presumed to occur. The amount
recognised is the largest amount of tax benefit that is greater
than 50% likely of being realised on examination. For tax positions
not meeting the "more likely than not" test, no tax benefit is
recorded.
Stock Options: In accordance with US GAAP, the Company accounts
for the cost of employee services received in exchange for an award
of equity instruments utilising the grant date fair value of the
award. Stock-based awards that do not require future service (i.e.,
vested awards) are expensed immediately. The expense associated
with stock-based employee awards that require future service are
amortised over the relevant service period.
Management Estimates: The preparation of financial statements in
conformity with US GAAP requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities as
of the date of the consolidated financial statements and the
reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates. The
estimates included by the Company in these consolidated financial
statements relate to warranty reserves, allowance for doubtful
accounts, the useful lives of patents and the license agreement,
the useful lives of depreciable property and equipment, and the
valuation allowance for deferred tax assets.
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)
Research and Development: Expenditures relating to the
development of new products and procedures are expensed as
incurred.
Foreign Currency Translation: The financial position and results
of operations of the Company's foreign subsidiaries are measured
using the subsidiary's local currency as the functional currency.
Assets and liabilities of the foreign subsidiaries are translated
to US dollars using exchange rates in effect as of the consolidated
balance sheet dates. Income and expense items are translated at
monthly average rates of exchange. The resultant translation gains
or losses are included as part of the components of stockholders'
equity designated as other comprehensive loss.
Contingencies: During the six months ended 30 June 2013, the
Company settled a dispute with a third party. Under the settlement,
the Company is owed $1,000,000, payable through April 2015. The
Company has recognised the settlement amount as a reduction to
selling, general, and administrative expneses in the consolidated
statements of operations. As of 30 June 2013, the Company has
received payments of $163,043 related to this settlement.
In addition to the aforementioned matter, the Company may
experience litigation arising in the ordinary course of business.
These claims are evaluated for possible exposure by management of
the Cmpany and their legal counsel. The Company believes that the
ultimate resolution of any such matters will not have a material
adverse effect on its consolidated financial position.
NOTE 2 - INVENTORIES
30 June 2013 30 June 2012
---------------- ---------------
Medical devices, parts, and solutions $ 4,791,469 $ 1,753,795
Raw materials 672,975 672,970
---------- --- ----------
$ 5,464,444 $ 2,426,765
============================================ ========== === ==========
NOTE 3 - PROPERTY AND EQUIPMENT
30 June 2013 30 June 2012
-------------------- --------------------
Property and equipment in progress $ 420,785 $ 1,069,557
Computer equipment 363,604 499,536
Furniture and fixtures 774,691 473,697
Equipment under capital lease 135,524 197,861
Laboratory equipment 1,934,675 1,589,297
Leasehold improvements 1,053,841 812,508
Tooling and moulds 843,176 580,758
Vehicles 153,142 167,720
--------------- --- ---------------
5,679,438 5,390,934
Accumulated depreciation and amortisation (3,098,695) (3,188,382)
--------------- --- ---------------
$ 2,580,743 $ 2,202,552
=============================================== =============== === ===============
During the six months ended 30 June 2013 and 30 June 2012, the
Company recognised property and equipment depreciation and
amortisation expense of $364,622 and $233,127, respectively.
NOTE 4 - INTANGIBLES
Intangible assets consist of the following:
30 June 2013 30 June 2012
-------------------- -------------------
Licensing agreement $ 141,931 $ 141,931
Patents issued 1,600,243 1,194,687
Patents pending 2,071,237 1,955,438
--------------- ---------------
3,813,411 3,292,056
Less: Accumulated amortisation (731,863) (623,805)
--------------- ---------------
$ 3,081,548 $ 2,668,251
==================================== =============== ===============
During the six months ended 30 June 2013 and 30 June 2012, the
Company recognised intangible amortisation expense of $64,973 and
$43,994, respectively.
During the six months ended 30 June 2013 and 30 June 2012, the
Company abandoned patents issued and patents pending with an
original cost of $5,597 and $9,052, respectively.
NOTE 5 - WARRANTS
As of 30 June 2013 and 2012, 31 miscellaneous warrants remain
outstanding with issue dates from 2004 through 2005 and expiration
dates between 2014 and 2015. No value is attributed to these
warrants as they are deemed to be immaterial in value as they were
subject to the effects of the 5,000 to 1 reverse stock split in
connection with the Company's initial public offering ("IPO") on 7
January 2008.
NOTE 6 - LINE OF CREDIT AGREEMENT
During August 2009, the Company entered into a two-year working
capital line of credit agreement with Silicon Valley Bank ("SVB")
to support potential future cash needs of the Company. This line of
credit, and amendments in 2010, 2011, 2012, and 2013, currently
provide for a revolving line of credit not to exceed an aggregate
principal amount of $3,000,000, lmited to qualifying receivables as
defined, and grants a security interest in and lien upon all of the
assets of Lifeline Scientific, Inc. and Organ Recovery Systems,
Inc. in favour of SVB. The maturity of the line of credit agreement
is 21 September 2014. The outstanding principal under the revolving
line of credit accrued interest at an annual rate of 1.25% above
the prime rate. In addition, a $750,000, 36 month term loan at a
5.50% unsecured or a 2.75% secured rate was made available to the
Company. During the year ended 31 December 2012, the Company drew
upon this term loan in the amount of $525,000 (at a secured rate of
2.75%) to support the Company's growth plans. The financing
agreement was amended during the period ended 30 June 2013 to
adjust the financial covenant requirement. The financing agreements
contain financial covenants which required the Company to maintain
minimum adjusted quick ratio levels (as defined) at 30 June 2012,
and a required minimum tangible net worth (as defined) at 30 June
2013. As of 30 June 2013 and 2012, the Company was in compliance
with all covenants.
NOTE 7 - INCOME TAXES
At the end of its interim six month periods, the Company makes
its best estimate of the annual expected effective income tax rate
and applies that rate to its ordinary earnings or loss for each six
month interim period. The income tax provision or benefit related
to significant, unusual, or extraordinary items, if applicable,
that will be separately reported or reported net of their related
tax effects are individually computed and recognised in the six
month interim period in which those items occur. In addition, the
effect of changes in enacted tax laws or rates, tax status,
judgment on the realisability of a beginning of the year tax asset
in future years or income tax contingencies is recognised in the
six month interim period in which the change occurs.
NOTE 7 - INCOME TAXES (Continued)
The computation of the annual expected effective income tax rate
at each six month interim period requires certain estimates and
assumptions including, but not limited to, the expected pre-tax
loss for the year, projections of the proportion of loss taxed in
foreign jurisdications, permanent and temporary differences, and
the likelihood of the realisability of deferred tax assets
generated in the current year. The accounting estimates used to
compute the provision or benefit for income taxes may change as new
events occur, more experience is acquired, additional information
is obtained, or the Company's tax environment changes.
Income tax (benefit) expense consists of the following
components:
30 June 2013 30 June 2012
--------------------- --------------------
Current
Federal $ (107,595) $ 41,683
Foreign 15,359 12,319
State 20,000 182,823
---------------- ----------------
Total income taxes $ (72,236) $ 236,825
=== ================ ================
The net deferred tax assets (liabilities) in the accompanying
consolidated balance sheets include the following components:
30 June 2013 30 June 2012
-------------------- --------------------
Deferred tax liabilities $ (1,033,140) $ (868,062)
Deferred tax assets 22,438,573 22,298,333
--------------- ----------------
Net deferred tax assets 21,405,433 21,430,271
Valuation allowance (20,365,748) (20,390,586)
--------------- ----------------
Net deferred tax assets $ 1,039,685 $ 1,039,685
=== =============== ================
The income tax (benefit) expense differs from the federal
statutory tax rate generally as a result of changes in each
jurisdiction's valuation allowance and permanent differences, such
as meals and entertainment expenses. Additionally, during the
period ended 30 June 2012, the Company amended certain state income
tax returns, resulting in additional expense of $162,798. A
valuation allowance has been provided to reduce the deferred tax
assets to the amount that is more likely than not to be
realised.
As of 30 June 2013, the Company has federal and state net
operating loss carryforwards totalling $59,456,000, which may be
used to offset future taxable income. If not used, the
carryforwards will expire as follows:
Year
2022 $ 4,110,000
2023 7,720,000
2024 6,412,000
2025 11,136,000
2026 12,197,000
2027 14,131,000
2028 3,750,000
-----------
Total loss carryforwards $ 59,456,000
=== ===========
NOTE 7 - INCOME TAXES (Continued)
As a result of changes in ownership at the IPO date, the Company
estimates there will be future limitations on the utilisation of
operating loss carryforwards pursuant to Internal Revenue Code
Section 382. Any unused annual loss limitation carries forward to a
future year. The annual limitation on loss carryforwards that could
be utilised is approximately $5,600,000 through the six months
ending 30 June 2013 and $2,600,000 after the six months ending 30
June 2013. The cumulative unused loss limitation, which carried
into the year ended 31 December 2012, was approximately
$14,000,000.
NOTE 8 - STOCK OPTIONS
A summary of option activity under the Second Amended and
Restated Stock Option and Restricted Stock Plan (the "2007 Plan")
as of 30 June 2013 and 2012, and the changes during the six months
ended 30 June 2013 and 2012 is as follows:
Weighted- Weighted-
Average Average Aggregate
Exercise Remaining Intrinsic
Number Price Contractual Value
of Shares GBP Term GBP
---------- ---------- ------------ ----------
Outstanding as of 1 January
2012 1,937,340 1.18 7.89 1,368,782
Granted - -
Exercised - -
Forfeitures (9,000) 0.58
----------
Outstanding as of 30 June 2012 1,928,340 1.18 7.40 1,080,918
========== ========== ============ ==========
Outstanding as of 1 January
2013 1,958,340 1.18
Granted 219,000 1.90
Exercised - -
Forfeitures (1,125) 2.13
----------
Outstanding as of 30 June 2013 2,176,215 1.25 6.79 1,429,358
========== ========== ============ ==========
Vested or expected to vest
as of
30 June 2013 2,148,568 1.24 6.76
========== ========== ============
Options exercisable as of 30
June 2013 1,558,090 0.97 6.04 1,411,073
========== ========== ============ ==========
The Company recognised compensation expense of $128,599 and
$129,356 for the six months ended 30 June 2013 and 2012,
respectively. As of 30 June 2013, there was approximately $627,472
of total unrecognised compensation cost related to nonvested
share-based compensation arrangements granted under the 2007 Plan.
That cost is expected to be recognised over a weighted-average
period of 1.29 years.
NOTE 9 - EARNINGS PER SHARE
Basic earnings per share is computed by dividing net income by
the weighted average number of shares of common stock outstanding
during the period. Diluted earnings per share include the dilutive
effect of stock options and warrants, using the treasury stock
method. The following table sets forth the computation of basic and
diluted earnings per share for the six months ended 30 June 2013
and 2012:
30 June 2013 30 June 2012
------------------- ------------------
Net loss attributed to common stock
shareholders $ (1,312,609) $ (393,070)
Weighted average shares outstanding
for basic
earnings per share 19,424,959 19,424,959
Dilutive effect of stock options - -
--- -------------- --------------
Weighted average shares outstanding
for diluted
earnings per share 19,424,959 19,424,959
============== ==============
Basic loss per share $ (0.07) $ (0.02)
Diluted loss per share $ (0.07) $ (0.02)
Diluted loss per share is the same as basic loss per share
because the effects of potentially dilutive securities are
anti-dilutive.
NOTE 10 - RELATED PARTY TRANSACTIONS
During the year ended 31 December 2010, the Company entered into
a consulting agreement with a company in which Steven Mayer, a
member of the Company's Board of Directors, is a director. Mr.
Mayer performed the consulting services. Fees for services rendered
under the consulting agreement were $36,000 and $24,000 for the six
months ended 30 June 2013 and 2012, respectively.
Additionally, during the six months ended June 2013 and 2012,
the Company did business with a company in which David Kravitz, the
Chief Executive Officer of the Company, and Steven Mayer have an
equity interest and are directors. Fees for products and services
rendered were $22,500 and $110,500 for the six months ended 30 June
2013 and 2012, respectively. As of 30 June 2013 and 2012, the
Company had prepaid $369,500 and $172,500 for products to be placed
in service and services expected to be rendered within the next
year.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LIFEAALITFIV
Lifeline Sci. S (LSE:LSI)
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부터 5월(5) 2024 으로 6월(6) 2024
Lifeline Sci. S (LSE:LSI)
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부터 6월(6) 2023 으로 6월(6) 2024
