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Wed, August 31, 2011

Annidis Corporation Reports 2011 Second Quarter Results


Published on 2011-08-31 13:41:39 - Market Wire
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OTTAWA, Aug. 31, 2011 /CNW/ - Annidis Corporation (TSXV:RHA), creator of the Annidis RHA™  imaging  technology that assists eye-care professionals screen, detect, diagnose and manage ocular diseases including glaucoma, age related macular degeneration and diabetic retinopathy, today announced its 2011 second quarter financial results for the three and six month periods ended June 30, 2011.

Highlights

  • Received FDA clearance for the RHA™ medical device
  • Recruited Mr. Kevin McNaught to the position of Vice President, U.S. Sales
  • Completed a Qualifying Transaction ("QT") as a Capital Pool Company on June 9, 2011, concurrent with a private placement of 6,674,000 units for gross proceeds of $3,337,000

"With the recent announcement that our RHA™ medical device has received FDA clearance, we now have the ability to build upon our existing Canadian presence and market RHA™ across North America," said Gerald Slemko, Chief Executive Officer of Annidis. "In order to execute on this sales strategy we have strengthened our balance sheet to fund its commercial roll-out and strengthened our team with the addition of Mr. Kevin McNaught to lead our U.S. sales initiatives."

Financial Highlights

The Company recorded contract revenues earned from the deployment of medical devices for the three and six months ended June 30, 2011, of $48,000 and $81,000, compared to $11,000 and $17,000 for the same periods in 2010. The increase in recorded revenue is attributable to the increase in the number of revenue generating medical devices deployed in clinics in the latter half of 2010 and during 2011.

Total general, administrative and operation expenses for the three months and six months ended June 30, 2011, were $309,000 and $583,000, compared to $293,000 and $480,000 for the corresponding periods in 2010. This increase is largely attributed to increased staff and higher salary costs.

Gross research and development expenses for the three months and six months ended June 30, 2011, were $333,000 and $619,514, compared with $349,000 and $563,487 in 2010. The increase is primarily due to increased salary costs and additional personnel. The reported 2011 amounts for the three and six months of $182,000 and $363,000 are net of investment tax credits of $151,000 and funding from government programs.

Net loss was $2,834,000 or loss of $0.05 per share and loss of $3,730,000 or loss of $0.08 per share, for the three-month and six-month periods ended June 30, 2011, compared with the loss of $629,000 or loss of $0.01 per share and loss of $976,000 or loss of $0.02 per share for the corresponding periods in 2010. The increase in reported loss is primarily attributed to the listing expense associated with the Qualifying Transaction of $1,589,000, financing transaction expenses, increased spending in general, administration & operations and sales & marketing.

During the three months and six months ended June 30, 2011, the Company used cash of $1,194,000 and $1,762,000 for operating activities as compared to $978,000 and $1,245,000 for the corresponding periods of 2010.  The increase in cash consumption for the six months ended June 30, 2011, was driven by net losses of $3,730,000 offset by non-cash items of listing expenses, stock-based compensation, interest and financing expenses and amortization.

As at June 30, 2011, the Company had cash on hand of $1,913,000 compared to $22,000 as at December 31, 2010, an increase of $1,890,000 due to the proceeds of $3,337,000 from the issuance of share and warrant units on the private placement and proceeds of $1,009,000 on the exercise of warrants offset operating losses, $410,000 on the repayment of promissory notes and convertible debenture and share issuance costs of $451,000.

Total current liabilities and long term liabilities were $4,016,000 at June 30, 2011, compared to $5,990,000 at December 31, 2010.

As at June 30, 2011, the Company's working capital was $145,000 compared to a working capital deficiency of $2,353,000 as at December 31, 2010.  This increase in working capital is attributed to the proceeds of $4,346,000 from the issuance of share and warrant units, offset by the reduction of $1,728,000 in promissory notes through conversion into equity, $744,000 in long-term convertible promissory notes and $410,000 in repayments.

Annidis Retains Equicom Group for Investor Relations Services

Annidis has announced that it has retained The Equicom Group Inc. ("Equicom") to provide strategic investor relations and financial communications services.

Under the terms of the agreement, Annidis will pay Equicom a monthly retainer fee of $6,000 for select strategic communications services. The initial contract term is 12 months and commences immediately.

Neither Equicom nor any of its principals have an ownership interest, directly or indirectly, in Annidis or its securities, and Annidis has not granted Equicom or its principals any right to acquire any such interests.

Equicom is a wholly-owned subsidiary of TMX Group Inc, and provides strategic communications services to approximately 100 public companies across a diverse range of industries from its offices in Toronto, Calgary and San Diego.

About Annidis Health Systems Corporation

Annidis was founded in 2007 and is dedicated to researching and developing instrumentation to assist in the early detection and monitoring of diseases of the eye. The RHA2020-U is the result of a multiyear research and development effort by the Annidis team in collaboration with leading eye care professionals and researchers in Canada including the Ottawa Eye Institute, Toronto Western Hospital, the School of Optometry in Montreal and numerous optometric clinics in Ontario.

In June, 2011, Annidis became a publicly traded Canadian company on TSX-V and trades under the symbol RHA.

Disclaimer

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

ANNIDIS CORPORATION          
Condensed Consolidated Statements of Financial Position  
As at June 30, 2011, December 31, 2010 and January 1, 2010      
[Unaudited]          
    June 30   December 31   January 1
    2011   2010   2010
ASSETS          
Current          
  Cash $ 1,912,606   $        22,248   $    192,630
  Restricted short-term investments    40,000   40,000       40,000
  Accounts receivable 164,401   60,799   22,113
  Government assistance receivable              -       -   117,868
  Investment tax credits receivable 601,673   878,203   400,000
  Inventories 691,590   467,194              -
  Prepaid expenses   7,199           -     13,943
  Deferred financing charges           -   15,399             -
             
  Total current assets 3,417,469   1,483,843   786,554
  Property and equipment, net 501,660   331,888      45,819
  Intangible assets, net     8,356     27,389     48,596
             
    $  3,927,485   $  1,843,120   $    880,969
LIABILITIES AND SHAREHOLDERS' EQUITY        
Current          
  Accounts payable and accrued liabilities $     348,259   $     468,270   $    269,975
  Promissory notes payable 325,532   3,072,202   301,182
  Deferred government assistance          -        -     12,499
  Due to related parties 364,392   296,636     148,197
  Convertible debentures 2,234,554             -                 -
             
  Total current liabilities 3,272,737   3,837,108    731,853
  Convertible debentures          -   2,152,788   2,007,344
  Convertible promissory notes 743,745          -              -
             
    4,016,482   5,989,896   2,739,197
Shareholders' deficit          
  Share capital 10,514,179   3,209,921   3,209,921
  Warrants 401,180   371,214   436,450
  Contributed surplus 833,700   380,538   243,007
  Deficit (11,838,056)   (8,108,449)   (5,747,606)
             
  Total shareholders' deficit (88,997)   (4,146,776)   (1,858,228)
             
    $  3,927,485   $  1,843,120   $     880,969

ANNIDIS CORPORATION          
Condensed Consolidated Statements of Operations and Comprehensive Loss  
For the three and six month periods ended June 30, 2011 and 2010      
[Unaudited]          
    Three months   Six months
    June 30 June 30   June 30 June 30
    2011 2010   2011 2010
             
Revenues          
  Contract revenues $       48,109 $      10,590   $       80,702 $      17,000
  Interest and other income   938     94   1,642        94
             
    49,047 10,684   82,344 17,094
             
Operating Costs and Expenses          
  Research and development 181,620 117,879   362,489 138,986
  General, administrative and operations 309,139 293,095   583,108 479,709
  Sales and marketing 264,661 126,121   456,398 200,129
  Amortization of property and equipment 33,229 6,627   60,511 13,436
  Amortization of intangible assets 5,301 5,301   10,603 10,603
             
    793,950 549,023   1,473,109 842,863
             
Loss from Operations (744,903) (538,339)   (1,390,765) (825,769)
             
  Interest and financing charges 79,052 56,901   162,847 80,637
  Interest on convertible debentures 33,676 23,520   57,196 44,520
  Accretion on convertible debentures 3,858      -   3,858         -
  Financing transaction costs 192,107      -   332,549         -
  Stock-based compensation 183,637 8,364   185,716 22,981
  Foreign exchange loss (gain) (558) 1,722   (518) 1,720
  Loss on licensing agreement 8,441      -   8,441        -
  Listing expense 1,588,753      -   1,588,753         -
             
    2,088,966 90,507   2,338,842 149,858
             
Net Loss and comprehensive loss for the period $(2,833,869) $(628,846)   $(3,729,607) $ (975,627)
             
Basic and diluted loss per share   $       (0.05)   $     (0.01)     $       (0.08)   $     (0.02)
             
 

ANNIDIS CORPORATION          
Condensed Consolidated Statements of Changes in Equity    
For the six month periods ended June 30, 2011 and 2010      
[Unaudited]          
          Total
  Share   Contributed   Shareholders'
  Capital Warrants Surplus Deficit Deficit
  $ $ $ $ $
Balance as at January 1, 2010 3,209,921 436,450 243,007 (5,747,606)    (1,858,228)
Value of warrants reclassified to contributed surplus on expiry                     -        (60,759)         60,759                     -                      -
Net loss and comprehensive loss for the period                     -                   -                   -        (975,627)        (975,627)
Share-based compensation expense                     -                   -         22,981                     -            22,981
Balance as at June 30, 2010 3,209,921 375,691 326,747 (6,723,233) (2,810,874)
           
Balance as at January 1, 2011 3,209,921 371,214 380,538 (8,108,449)    (4,146,776)
Exercise of share purchase warrants 1,216,883 (207,803)   -          - 1,009,080
Common shares issued on conversion of promissory notes and accrued interest      1,728,468                   -                   -                     -       1,728,468
Common shares and warrants issued pursuant to private placement      3,206,523       130,477                   -                     -       3,337,000
Broker unit warrants issued in connection with private placement                     -         81,077                   -                     -            81,077
Share and warrant issuance costs        (512,599)        (19,089)            (531,688)
Equity component of the conversion right on the promissory note                     -                   -       267,446                     -          267,446
Net loss and comprehensive  loss for the period                     -                   -                   -     (3,729,607)     (3,729,607)
Share-based compensation expense                     -                   -       185,716                     -          185,716
Fair value assigned to the shares on reverse takeover transaction      1,664,983                   -                   -                     -       1,664,983
Fair value assigned to the warrants on reverse takeover transaction                     -         45,304                   -                     -            45,304
           
Balance as at June 30, 2011    10,514,179       401,180       833,700   (11,838,056)          (88,997)

ANNIDIS CORPORATION          
Condensed Consolidated Statements of Changes of Cash Flows      
For the three and six month periods ended June 30, 2011 and 2010      
[Unaudited]          
    Three months   Six months
    June 30 June 30   June 30 June 30
    2011 2010   2011 2010
             
OPERATING ACTIVITIES          
Net loss for the period $(2,833,869) $   (628,846)   $(3,729,607) $   (975,627)
Add items not involving cash          
  Non-cash interest and financing expense 48,311 29,592   125,189          40,573
  Listing expense 1,579,915           -   1,579,915                    -
  Interest on convertible debentures and notes 33,676 23,520   57,196          44,520
  Loss on licensing agreement       8,441          -   8,441                    -
  Stock-based compensation 183,637   8,364   185,716          22,981
  Amortization of property and equipment 33,229 6,627   60,511          13,436
  Amortization of intangible assets 5,301   5,301   10,603          10,603
  Amortization of debenture issue costs   28,342 14,180   31,903          25,523
  Accretion of convertible debenture    3,858        -   3,858                    -
    (909,159) (541,262)   (1,666,275) (817,991)
Changes in non-cash working capital items (285,008) (437,142)   (95,531) (427,008)
             
Cash used in operating activities (1,194,167) (978,404)   (1,761,806) (1,244,999)
             
INVESTING ACTIVITIES          
Acquisition of property and equipment (186,288) (15,979)   (230,283) (19,891)
             
Cash used in investing activities (186,288) (15,979)   (230,283) (19,891)
             
FINANCING ACTIVITIES          
Proceeds from warrants exercised       -      -   1,009,080                    -
Proceeds from the issuance of promissory notes 300,000 1,100,000   300,000     1,500,000
Cash received on Aumento Capital Corporation 130,371     130,371                    -
Repayment of promissory notes (150,000)            -   (410,000)                    -
Repayment of interest on promissory notes (10,225)        -   (33,393)                    -
Proceeds from the issuance of share and warrant units 3,337,000         -   3,337,000                    -
Convertible debenture and share issuance costs (412,448)         -   (450,611)                    -
             
Cash provided by financing activities 3,194,698 1,100,000   3,882,447     1,500,000
             
Net increase in cash during the period 1,814,243 105,617   1,890,358       235,110
Cash, beginning of period 98,363 322,123   22,248 192,630
             
Cash, end of period $  1,912,606 $     427,740   $  1,912,606 $     427,740

 

 

Contributing Sources