Full Press Release Details
Reports Steady Growth in Q2 2015
MONMOUTH JUNCTION, NJ - August 13, 2015
- CytoSorbents Corporation (NASDAQ: CTSO), a critical care immunotherapy leader commercializing its CytoSorb(R) blood
purification technology to reduce deadly uncontrolled inflammation in hospitalized patients around the world, reported financial
and operational results for the three and six months ended June 30, 2015.
Highlights Potential Catalysts for
Accelerated Growth in the Second Half of 2015
Recent Financial Highlights:
Recent Operational Highlights:
Dr. Phillip Chan, Chief Executive Officer
of CytoSorbents stated, "We achieved solid growth in CytoSorb(R) sales in the second quarter of 2015, driven by increases
in new accounts and reorders in our direct sales territories by our core four person sales team. In fact, on a pro-forma
basis, if we exclude the impact of the decline in the Euro, our product revenues would have been $920K, our second best quarter
for CytoSorb(R) sales in our history. More recently, there have been a number of developments and near term catalysts that
should begin to accelerate growth in the second half of this year. These include:
Dr. Chan continued, "In addition
to our commercialization efforts abroad, we are heavily focused on bringing CytoSorb(R) to the U.S. market through two main paths.
Dr. Chan concluded, "Finally, we
continue to be excited about the regular flow of successful case report studies and ongoing larger studies that are coming in from
around the world. The upcoming 2nd International CytoSorb(R) User's Meeting will report on many of these, and
we will give an overview of several of these cases during today's earnings call."
"Please join us on the earnings call
today at 4:45PM EDT where we will cover our progress in greater detail. In addition, we will address questions from analysts and
investors during the live question and answer period. The investor presentation and a written transcript of the conference call
will be available within a week of the webcast on our website."
Conference Call Details:
Date: Thursday, August 13, 2015
Time: 4:45 PM Eastern
Participant Dial-In: 719-325-4744
Live Presentation Webcast: http://public.viavid.com/index.php?id=115295
An archived recording of the conference
call will be available under the Investor Relations section of the Company's website at http://www.cytosorbents.com/invest.htm
Financial Results for the Second
Quarter Ended June 30, 2015
The Company generated total revenues of
approximately $964,000 and $1,025,000 for the three months ending June 30, 2015 and June 30, 2014, respectively. Product revenues
were approximately $773,000 for the quarter ended June 30, 2015, as compared to product revenues of $663,000 for the quarter ended
June 30, 2014. This $110,000 or approximately 17% increase in product revenues was a result continued growth of direct sales as
well as expansion of sales to our growing distributor network. Product sales were also negatively impacted by the decline in the
exchange rate of the Euro. The impact of the decline in the exchange rate of the Euro was approximately $147,000, or 19% of sales,
for the three months ended June 30, 2015. Additionally, grant revenue and other income was approximately $191,000 and $361,000
for the three month periods ended June 30, 2015 and 2014, respectively, as a result of the conclusion during 2014 of several significant
For the three months ended June 30, 2015
and 2014, cost of revenue was approximately $465,000 and $666,000, respectively. The decrease in cost of revenues is directly related
to a decrease of direct labor and other costs being deployed toward grant-funded activities, which has the effect of decreasing
the amount of costs allocated to cost of revenue. Product gross margins were approximately 63% for the three months ended June
30, 2015, as compared to approximately 65% for the three months ended June 30, 2014.
Research and Development Expenses:
For the three months ending June 30, 2015,
research and development costs were approximately $802,000, as compared to research and development costs of approximately $347,000
for the three months ended June 30, 2014, an increase of approximately $455,000 or 131%. This increase was primarily due to a decrease
of approximately $254,000 of direct labor and other costs being deployed toward grant-funded activities in the three months ended
June 30, 2015 as compared to the three months ended June 30, 2014, which had the effect of increasing the amount of our non-reimbursable
research and development costs. In addition, salaries and other costs related to our various clinical studies increased approximately
$155,000 during the three months ended June 30, 2015 as compared to the three months ended June 30, 2014.
Legal, Financial and Other Consulting
Legal, financial and other consulting costs
were approximately $298,000 for the three months ending June 30, 2015, as compared to legal financial and other consulting costs
of approximately $166,000 for the three months ended June 30, 2014. This increase of approximately $132,000 was primarily due to
legal fees related to general corporate and governance matters as well as consulting fees related to Sarbanes-Oxley compliance.
Selling, General and Administrative
Selling, general and administrative expenses
were approximately $1,626,000 for the three months ended June 30, 2015, compared to approximately $1,209,000 for the three months
ended June 30, 2013, an increase of approximately $417,000. This was primarily due to increases in payroll related costs of approximately
$171,000, increased royalties and license fees of approximately $20,000 due to increases in product sales, additional sales and
marketing costs, which include advertising and conferences of approximately $73,000 and an increase in stock transfer, filing and
stock exchange fees of approximately $76,000 due to associated with our listing on the NASDAQ Capital Market and our first annual
shareholders meeting in 2015.
Our net income for the three months ended
June 30, 2015 was approximately $1,434,000, as compared to a net loss of approximately $1,854,000 for the three months ended June
30, 2014. Net income for 2015 included an approximately $3,597,000 reduction in the warrant liability which is a non-cash component
of other income/expense.
Cash and Short-Term Investments:
On June 30, 2015 our cash and short-term
investments were approximately $11,205,000, as compared to cash balances of approximately $5,550,000 as of December 31, 2014. This
increase in cash is a direct result of our January 2015 registered offering of our Common Stock from which we received approximately
$9,409,000 in net proceeds.
Financial Results for the First Six
Months Ended June 30, 2015
Revenue from product sales was approximately
$1,477,000 in the six months ended June 30, 2015, as compared to approximately $1,232,000 in the six months ended June 30, 2014,
an increase of approximately $245,000, or 20%. This increase was driven by the continued growth in direct sales as well as the
expansion of sales to our growing distributor network, which was offset by the negative impact of the decline in the exchange rate
of the Euro relative to the U.S. dollar. The impact of the decline in the exchange rate of the Euro was approximately $259,000,
or 19% of sales, for the six months ended June 30, 2015.
Grant income was approximately $198,000
for the six months ended June 30, 2015 as compared to approximately $850,000 for the six months ended June 30, 2014 as a result
of the conclusion during 2014 of several significant grants.
As a result of the decrease in grant income,
for the six months ended June 30, 2015, we generated total revenue of approximately $1,687,000, as compared to revenues of approximately
$2,087,000, for the six months ended June 30, 2014, a decrease of approximately $400,000, or 19%.
For the six months ended June 30, 2015
and 2014, cost of revenue was approximately $770,000 and $1,329,000, respectively. The decrease is directly related to a decrease
of approximately $676,000 of direct labor and other costs being deployed toward grant-funded activities, which has the effect of
decreasing the amount of costs allocated to cost of revenue. Product cost of revenues increased approximately $117,000 during the
six months ended June 30, 2015 as compared to the six months ended June, 2014 due to increased sales. Product gross margins were
approximately 61% for the six months ended June 30, 2015, as compared to approximately 63% for the six months ended June 30, 2014.
Research and Development Expenses:
For the six months ended June 30, 2015,
research and development expenses were approximately $1,753,000 as compared to research and development expenses of approximately