Full Press Release Details
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Marc Panoff, CFO Garth Russell / Todd Fromer
Nephros, Inc. KCSA Worldwide
Tel: 212-781-5113 212-896-1250 / 212-896-1215
Nephros Reports Third Quarter 2005 Financial Results
NEW YORK, November 14, 2005 - Nephros, Inc. (AMEX: NEP) announced today
financial results for the three months and nine months ended September 30, 2005.
For the quarter ended September 30, 2005, Nephros reported net revenue of
$225,248, attributable to sales of its OLpur(TM) MD190 product in Europe,
compared to $46,379 in the corresponding period of 2004. The Company's net loss
was $1,747,882 for the third quarter of 2005, versus a net loss of $1,881,849 in
the third quarter of 2004. Nephros reported a net loss attributable to common
stockholders in the third quarter of 2005 of $1,747,882, or $0.14 loss per basic
and diluted share, compared to a loss of $8,864,795, or $3.89 loss per basic and
diluted share, in the year-earlier period. The average number of common basic
and diluted shares for the quarter ended September 30, 2005 was 12,307,089,
compared to 2,280,176 for the quarter ended September 30, 2004.
For the nine months ended September 30, 2005, Nephros reported net revenue of
$2,353,339 compared with $46,379 in the same period of 2004. For the first nine
months of 2005 net revenue recognized from product sales totaled $603,339. Nine
month net revenue also included a one-time, upfront fee of $1.75 million
resulting from Nephros's license agreement with Asahi Kasei Medical Co., Ltd.,
the largest filter provider in Japan, entered into on March 2, 2005.
Nephros's net loss was $4,173,102 for the first nine months of 2005, versus a
net loss of $5,579,615 in the comparable period last year. Nephros reported a
net loss attributable to common stockholders of $4,173,102, or $0.34 loss per
basic and diluted share, for the first nine months of 2005, compared to a loss
of $17,314,148, or $9.49 loss per basic and diluted share, in the same period
last year. The average number of common basic and diluted shares for the nine
months ended September 30, 2005 was 12,254,753, compared to 1,825,013 for the
nine months ended September 30, 2004.
It should be noted that Nephros does not recognize revenue from product sales
until a customer's right of return has expired. It should also be noted that the
differences between net loss and net loss attributable to common stockholders
for the 2004 periods are the result of the accrual of preferred dividends and
the accretion of a beneficial conversion feature associated with Nephros's
issuance of series D convertible preferred stock.
As of September 30, 2005, Nephros had cash, cash equivalents and short-term
investments of $6,827,693.
"Nephros continues to build key relationships with physicians, clinical groups
and government agencies on both sides of the Atlantic that can lead to future
growth, and pursue sales opportunities for our core OLpur(TM) MD190 filter in
Europe. Our marketing trials are progressing in Europe, with preliminary data
expected before year-end. We were also issued a key U.S. patent for our
OLpur(TM) H2H(TM) online hemodiafiltration module in July, highlighting the
unique and proprietary value we've created with this technology. We are moving
ahead with our strategy to be the first to introduce more effective therapy here
in the United States using our H2H(TM) platform, increasing our OLpur(TM) filter
sales opportunities accordingly," stated Norman Barta, chief executive officer
Nephros, Inc., headquartered in New York, is a medical device company developing
and marketing products designed to improve the quality of life for the End-Stage
Renal Disease (ESRD) patient, while addressing the critical financial and
clinical needs of the care provider. ESRD is a disease state characterized by
the irreversible loss of kidney function. Nephros believes that its products are
designed to remove a range of harmful substances more effectively, and more
cost-effectively, than existing treatment methods; particularly with respect to
substances known collectively as "middle molecules," due to their molecular
weight, that have been found to contribute to such conditions as dialysis
related amyloidosis, carpal tunnel syndrome, degenerative bone disease and
ultimately, to mortality in the ESRD patient.
Forward Looking Statements
This news release contains certain "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995, as amended.
Such statements may include statements regarding the efficacy and intended use
of Nephros's technologies under development, the timelines for bringing such
products to market and the availability of funding sources for continued
development of such products and other statements that are not historical facts,
including statements which may be preceded by the words "intends," "may,"
"will," "plans," "expects," "anticipates," "projects," "predicts," "estimates,"
"aims," "believes," "hopes," "potential" or similar words. For such statements,
Nephros claims the protection of the Private Securities Litigation Reform Act of
Forward-looking statements are not guarantees of future performance, are based
on certain assumptions and are subject to various known and unknown risks and
uncertainties, many of which are beyond the control of Nephros. Actual results
may differ materially from the expectations contained in the forward-looking
statements. Factors that may cause such differences include the risks that: (i)
products that appeared promising in research or clinical trials to Nephros may
not demonstrate anticipated efficacy, safety or cost savings in subsequent
pre-clinical or clinical trials; (ii) Nephros may not obtain appropriate or
necessary governmental approvals to achieve its business plan; (iii) product
orders may be cancelled, patients currently using Nephros's products may cease
to do so and patients expected to begin using Nephros's products may not; (iv)
hemodiafiltration therapy may not be accepted in the United States and/or
Nephros's technology and products may not be accepted in current or future
target markets, which could lead to the failure to achieve market penetration of
Nephros's products; (v) Nephros may not be able to sell its products at
competitive prices or profitably; (vi) Nephros may not be able to build key
relationships with physicians, clinical groups and government agencies, pursue
or increase sales opportunities in Europe or elsewhere, or be the first to
introduce hemodiafiltration therapy in the United States; (vii) Nephros may not
be able to secure or enforce adequate legal protection, including patent
protection, for its products; and (viii) Nephros may not be able to achieve
sales growth in Europe or expand into other key geographic markets. More
detailed information about Nephros and the risk factors that may affect the
realization of forward-looking statements is set forth in Nephros's filings with
the Securities and Exchange Commission, including Nephros's Annual Report on
Form 10-KSB filed with the SEC for the fiscal year ended December 31, 2004 and
its Quarterly Report on Form 10-QSB filed with the SEC for the fiscal quarter
ended June 30, 2005. Investors and security holders are urged to read those
documents free of charge on the SEC's web site at www.sec.gov. Nephros does not