Full Press Release Details
Oculus Innovative Sciences Reports Financial
Results for the Second Quarter of Fiscal Year 2015
Conference Call Begins at 4:30 p.m. (ET)
PETALUMA, Calif.--(November 13, 2014)--Oculus Innovative
Sciences, Inc. (NASDAQ: OCLS) today announced financial results for the second quarter of fiscal year 2015, which ended on September
30, 2014. Total revenue was $3.3 million for the second quarter as compared to $4.1 million for the same period last year. The
net loss for the second quarter was $0.7 million, compared to a net loss of $1.4 million for the same period last year.
"We have set in motion three key new initiatives which
we believe will return us to strong revenue growth," said Jim Schutz, Oculus CEO. "First, beginning this quarter, our
team is planning to launch six new products in the United States over the next six months using our direct sales force. Second,
Europe continues to be a bright spot with four new CE Mark approvals for acne, scar treatment, atopic dermatitis and the treatment
of skin procedures. We are creating a country-specific dermatology-distribution network in Europe, starting this week at Medica,
a major medical trade fair in Germany. Third, we have selected two new partners that are highly experienced in the animal healthcare
market to launch the Microcyn line of animal healthcare products in the United States in 2015."
Results for the Three Months Ended September 30, 2014
Product revenue in Mexico for the three months ended September
30, 2014, of $1.5 million, increased $189,000, or 14%, when compared to the same period in the prior year with an increase of 34%
in units sold. The increased revenue was due to the strong growth in the sales of hydrogel and 120-milliliter liquid products.
Additionally, for the three months ended September 30, 2014 and 2013, $378,000 was recognized related to the amortization of the
upfront license fees paid by More Pharma.
Product revenue in Europe and Rest of the World for the three
months ended September 30, 2014, of $554,000, decreased $49,000, or 8%, as compared to the same period in the prior year. Lower
sales in the Middle East and China were partially offset by a 26% sales increase in Europe. The increased sales in Europe were
largely the result of the introduction of multiple new advanced tissue care product line extensions including a gel product, as
well as the addition of new European distributors. The sales decline in the Middle East relates to the timing of periodic orders
Total product revenues in the United States were $978,000 for
the three months ended September 30, 2014, as compared to $1,898,000 in the quarter ended September 30, 2013, with lower sales
in animal healthcare and dermatology, partially offset by increased sales of advanced tissue care products sold by the Oculus direct
salesforce. The decline in revenue was caused primarily by the transition of the former animal healthcare partner to a new supplier.
The quarter ending September is seasonally the largest quarter in sales for the company's animal health care products, exaggerating
Product revenues for the second quarter ended September 30,
2014, were $3.1 million compared to $3.9 million in the same period in 2013, with lower sales in the United States, the Middle
East and China, which were partly offset by increases in revenue in Europe and Mexico. The sales decline was primarily attributable
to the reduction in animal healthcare sales as the former partner transitioned to a new supplier.
Oculus reported gross profit related to its products of $1.7
million, or 55% of product revenues, during the three months ended September 30, 2014, compared to a gross profit of $2.6 million,
or 69% of product revenues, for the same period in the prior year. Licensing revenues are included in the calculation of product
revenues and gross profit for the quarters ended September 30, 2014 and 2013. Gross margins declined primarily as a result
of the decline in U.S. sales related to the company's animal healthcare products.
Total operating expenses of $3.3 million for the three months
ended September 30, 2014, decreased by $699,000, or 18%, as compared to the same period in the prior year. Operating expenses minus
non-cash expenses during the second quarter of fiscal year 2015 were $2.9 million, down $791,000 as compared to the same period
in the prior year. The decrease in operating expenses, minus non-cash expenses, was due to lower expenses related to the company's
previously consolidated, wholly owned subsidiary, Ruthigen, partially offset by higher sales, marketing and administrative expenses
in the United States and Europe.
Research and development expenses were $353,000 for the three
months ended September 30, 2014, down $530,000 from the same period last year, due to lower expenses of $495,000 incurred by the
previously consolidated, wholly owned subsidiary, Ruthigen. Selling, general and administrative expense of $2.9 million for the
three months ended September 30, 2014, decreased $170,000, or 5%, over the same period last year, largely related to a decrease
in Ruthigen's expenses. This reduction was partially offset by increases in sales, marketing and administrative expenses
in the United States and Europe.
Net loss for the three months ended September 30, 2014, was
$718,000, a reduction of $681,000, as compared to the net loss of $1.4 million for the same period in the prior year. The decrease
in net loss from the prior year is due to the mark-to-market adjustment of derivative liabilities related to outstanding common
stock purchase warrants. Stock-based compensation charges were $456,000 and $319,000 for
the quarters ended September 30, 2014 and 2013, respectively.
As of September 30, 2014, Oculus had unrestricted cash and cash
equivalents of $3.5 million, as compared with $5.5 million at March 31, 2014.
Results for Six Months Ending September 30, 2014
Total revenues were $6.7 million for the six months ended September
30, 2014, as compared to $7.5 million for the same period in the prior year. Product revenues, including product licensing fees
received, for the six months ended September 30, 2014, decreased $764,000, or 11%, to $6.2 million, as compared to $7.0 million
for the same period in the prior year, with decreases in sales in the United States and China, partially offset by increases in
Europe, Mexico, the Middle East and Singapore.
Oculus reported gross profit related to sales of its products
of $3.5 million, or 57% of product revenues, for the six months ended September 30, 2014, compared to a gross profit of $4.8 million,
or 68% of product revenues, for the same period in the prior year. Total operating expenses minus non-cash expenses decreased $743,000,
for the six months compared to the same period in the prior year. Operating loss minus non-cash expenses (EBITDAS) for the six
months ended September 30, 2014, was $2.0 million, compared to $1.6 million for the same period last year.
Oculus management will hold a conference call today to discuss
second quarter fiscal year 2015 results and answer questions, beginning at 4:30 p.m. ET. Individuals interested in participating
in the conference call may do so by dialing 877-303-7607 for domestic callers or 973-638-3203 for international callers.
Those interested in listening to the conference call live via
the Internet may do so at http://ir.oculusis.com/events.cfm. Please log on approximately 30 minutes prior to the presentation in
order to register and download the appropriate software.
A telephone replay will be available for five days following
the conclusion of the call by emailing bmiller@oculusis.com.
About Oculus Innovative Sciences, Inc.
Oculus Innovative Sciences is a specialty pharmaceutical company
that develops and markets solutions for the treatment of dermatological conditions and advanced tissue care. The company's
products, which are sold throughout the United States and internationally, have improved outcomes for more than five million
patients globally by reducing infections, itch, pain, scarring and harmful inflammatory responses. The company's headquarters
are in Petaluma, California, with manufacturing operations in the United States and Latin America. European marketing and
sales are headquartered in Roermond, Netherlands. More information can be found at www.oculusis.com.
Forward-Looking Statements
Except for historical information herein, matters set forth
in this press release are forward-looking within the meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995, including statements about the commercial and technology progress and future financial performance
of Oculus Innovative Sciences, Inc. and its subsidiaries (the "Company"). These forward-looking statements are identified
by the use of words such as "creating," "starting," "return," and "launching,"
among others. Forward-looking statements in this press release are subject to certain risks and uncertainties inherent in the Company's
business that could cause actual results to vary, including such risks that regulatory clinical and guideline developments
may change, scientific data may not be sufficient to meet regulatory standards or receipt of required regulatory clearances
or approvals, clinical results may not be replicated in actual patient settings, protection offered by the Company's patents
and patent applications may be challenged, invalidated or circumvented by its competitors, the available market for the Company's products
will not be as large as expected, the Company's products will not be able to penetrate one or more targeted markets, revenues
will not be sufficient to fund further development and clinical studies, the Company may not meet its future capital needs,
the Company may not be able to obtain additional funding, as well as uncertainties relative to varying product formulations and
a multitude of diverse regulatory and marketing requirements in different countries and municipalities, and other risks detailed
from time to time in the Company's filings with the Securities and Exchange Commission including its annual report on Form 10-K