Immunotec Inc.
TSX VENTURE : IMM

Immunotec Inc.

March 25, 2011 16:00 ET

Immunotec Announces Financial Results for the First Quarter Ended January 31, 2011

VAUDREUIL-DORION, QUEBEC--(Marketwire - March 25, 2011) - Immunotec Inc. (TSX VENTURE:IMM), a Canadian based company and a leader in the wellness industry (the "Company"), today reported financial results for the first quarter of fiscal year 2011. Revenues totalled $10.4 million, compared to $10.5 million for the corresponding period last fiscal year. Net loss and comprehensive loss were ($1,323) thousand compared to earnings of $209 thousand last year.

"The annual event held last February was energizing to everybody, while confirming the value of our products" said Bob Henry, Immunotec's Executive Chairman and CEO; "We are committed to develop our leaders and stimulate recruitment by using the new marketing tools just announced at our last event".

Highlights for Q1

The Board of directors approved several appointments during the first quarter, to further strengthen its management team following recent departures. These new appointees have more than 100 years of experience in the Network marketing industry:

  • Mr. Robert Henry is assuming the additional role of Chief Executive Officer ("CEO") in addition to his current Executive Chairman role. In light of this, M. Henry has stepped down from both the Audit and the Human Resources and Compensation Committees.

  • Mr. Stuart A. MacMillan is the new President of the Corporation.

  • Mr. Robert Felton is appointed as Chief Operating Officer ("COO") of the Corporation.

  • Mr. Rod Milne is appointed as Vice-President, Field Development and Marketing of the Corporation.

Network sales reached $9.1M in 2011 compared to $8.9M for the same period in 2010, a small increase of 2% including incremental revenues in Mexico of $1.3M despite the strengthening of the Canadian currency over the US dollar. Total consolidated revenues remained steady reaching $10.4M in 2011 vs. $10.5M in 2010.

Sales incentives increased significantly to reach a rate of 53%, compared with 48% in the previous period, as a result of strong new recruitment and moving up bonuses paid as part of the compensation plan. This increase in commission payout, although a positive element for the Network as negatively impacted the margins and the overall profitability of the Company for this quarter to 29% for the period compared with 37% last year.

Expenses were $4.4M for the period compared to $2.9M last year. The increase of $1.5M this quarter include restructuring charges of $0.7M and other administrative and marketing expenses associated with the modernization effort and new tools deployed to the field at the last annual event subsequent to quarter. The Company also invested into Development costs and launched in February 2011, two new products.

Restructuring charges negatively impacted the results of this first quarter. These restructuring provisions are associated with recent departures and in accordance with a termination agreement.

Subsequent to the quarter, in February 2011, the Company renewed the loans and the credit facilities with the bank.

Net loss and comprehensive loss totalled $1,3M for the quarter ending January 31, 2011, compared to earnings of $209 thousand for 2010. The total basic and fully diluted loss per share for the period in 2011 was ($0.019) compared to earnings of $0.003 for the same period in Fiscal 2010.

About Immunotec Inc.

Immunotec is a world class business opportunity supported by unique scientifically proven products that improve wellness. Headquartered with manufacturing facilities near Montreal, Canada, the Company also has distribution capacities to support its commercial activities in Canada and internationally to the United States, Europe, Mexico and The Caribbean.

The Company files its consolidated financial statements, its management and discussion analysis report, its press releases and such other required documents on the SEDAR database at www.sedar.com and on the Company's website at www.immunotec.com. The common shares of the Company are listed on the TSX Venture Exchange under the ticker symbol IMM.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this news release are forward-looking and are subject to numerous risks and uncertainties, known and unknown. For information identifying known risks and uncertainties and other important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the heading Risks and Uncertainties in Immunotec's most recent Management's Discussion and Analysis, which can be found at www.sedar.com. Consequently, actual results may differ materially from the anticipated results expressed in these forward-looking statements.

Consolidated Balance Sheets

   As at January    As at October  
  31, 2011   31, 2010  
  $   $  
ASSETS        
         
Current        
Cash 1,903,838   2,936,456  
Accounts receivable 529,680   782,557  
Income taxes receivable 10,061   -  
Inventories 3,308,778   2,605,371  
Prepaid expenses 687,438   382,794  
Future income taxes 85,094   103,099  
  6,524,889   6,810,277  
Long-term        
         
Property, plant and equipment 5,579,713   5,674,090  
Intangible assets 2,381,412   2,456,651  
Goodwill 833,559   833,559  
Future income taxes 2,843,440   2,382,148  
Other assets 484,349   484,349  
  18,647,362   18,641,074  
LIABILITIES AND SHAREHOLDERS' DEFICIT      
       
Current liabilities        
Demand loan 950,000   1,000,000  
Accounts payable 2,061,787   1,593,697  
Accrued liabilities 3,498,128   2,707,076  
Customer deposits 375,979   274,051  
Income taxes payable -   2,041  
Other liability - current portion 147,218   147,218  
  7,033,112   5,724,083  
         
Other liability 239,622   239,622  
  7,272,734   5,963,705  
Shareholders' deficit        
         
Share capital 3,465,548   3,465,548  
Other equity - Stock options 1,928,246   1,907,584  
Contributed surplus 11,337,796   11,337,796  
Deficit (5,356,962 ) (4,033,559 )
  11,374,628   12,677,369  
  18,647,362   18,641,074  

Consolidated Statements of Changes in Shareholders' Deficit

  Number
of

common
shares

Share
capital
$
Other
equity

- Stock
options
$

Contri-
buted

surplus
$


Deficit
$
 

Total
$
 
Balance - October 31, 2009 69,994,300 3,465,548 1,770,093 11,337,796 (2,646,399 ) 13,927,038  
   
Net profit - - - - 209,301   209,301  
Stock-based
compen-
sation
- - 49,603 - -   49,603  
   
Balance - January 31, 2010 69,994,300 3,465,548 1,819,696 11,337,796 (2,437,098 ) 14,185,942  
   
Balance - October 31, 2010 69,994,300 3,465,548 1,907,584 11,337,796 (4,033,559 ) 12,677,369  
   
Net loss - - - - (1,323,403 ) (1,323,403 )
Stock-based
compen-
sation
- - 20,662 - -   20,662  
   
Balance - January 31, 2011 69,994,300 3,465,548 1,928,246 11,337,796 (5,356,962 ) 11,374,628  

Consolidated Statements of Loss and Comprehensive Loss

Quarters ended January 31, 2011   2010  
  $   $  
   
Revenues        
Network sales 9,064,019   8,865,644  
Other revenue 1,311,628   1,615,426  
  10,375,647   10,481,070  
Variable costs        
Cost of goods sold (excluding amortization) 1,995,700   2,022,251  
Sales incentives - Network 4,769,801   4,248,329  
Other variable costs 941,804   900,572  
Margin before expenses 2,668,342   3,309,918  
Expenses        
Administrative 1,759,226   1,413,475  
Marketing and selling 1,441,758   860,602  
Quality and development costs 254,226   251,903  
Amortization 285,792   287,029  
Restructuring charges 664,537   -  
Stock-based compensation 20,662   49,603  
Foreign exchange loss (gain) 4,128   (3,163 )
  4,430,329   2,859,449  
before income taxes (1,761,987 ) 450,469  
         
Income taxes (recovery)        
Current 4,703   24,986  
Future (443,287 ) 82,893  
(Loss) earnings from continuing operations (1,323,403 ) 342,590  
   
Loss from discontinued operations -   (133,289 )
(loss) income (1,323,403 ) 209,301  
   
Basic and diluted net (loss) earnings per share        
Continuing operations (0.019 ) 0.005  
Discontinued operations -   (0.002 )
Total basic and diluted net (loss) earnings per share (0.019 ) 0.003  
   
Weighted average number of common shares outstanding      
during the period        
Basic and diluted 69,994,300   69,994,300  

Consolidated Statement of Cash Flows

Quarters ended January 31, 2011   2010  
  $   $  
Operating activities        
Net (loss) earnings (1,323,403 ) 209,301  
Loss from discontinued operations -   (133,289 )
(Loss) earnings from continuing operations (1,323,403 ) 342,590  
Add (deduct) non cash items:        
  Amortization of property, plant and equipment 138,735   141,146  
  Amortization of intangible assets 147,057   145,883  
  Other receivables -   43,442  
  Future income taxes (443,287 ) 82,893  
  Stock-based compensation 20,662   49,603  
Cash received prior to working capital variation (1,460,236 ) 805,557  
   
Net change in non-cash working capital 593,794   (546,950 )
Cash (used) received from operating activities (866,442 ) 258,607  
Investing activities        
  Additions to property, plant and equipment (44,358 ) (27,689 )
  Additions to intangible assets (71,818 ) (15,619 )
Cash used from investing activities (116,176 ) (43,308 )
Financing activities        
  Reimbursment of demand loan (50,000 ) -  
Cash used from financing activities (50,000 ) -  
   
Net (decrease) increase in cash from continuing operations (1,032,618 ) 215,299  
Net decrease in cash from discontinued operations        
  Operating activities -   (133,289 )
Net (decrease) increase in cash during the period (1,032,618 ) 82,010  
Cash at the beginning of the period 2,936,456   2,262,821  
Cash at the end of the period 1,903,838   2,344,831  
   
Supplemental information        
Income tax paid (recovered) during the period 5,377   (7,983 )

"The TSX Venture does not accept responsibility for the adequacy or accuracy of this release."

Contact Information

  • Immunotec Inc.
    Patrick Montpetit
    VP and Chief Financial Officer
    450-510-4527