BUFFALO, N.Y., April 17 /PRNewswire-FirstCall/ -- MINRAD International, Inc. today announced its financial results for the quarter ended March 31, 2006. The Company generated revenue of $3,123,000 for the quarter compared to revenue of $2,429,000 in the same period in 2005. Revenue in both North America and the International markets each increased at a double digit rate.
1st Quarter
$ Thousands 2005 2006 %
North America 814 902 11
International 1615 2221 38
Total 2429 3123 29
For the quarter, the company experienced a net loss available for common shareholders of $(748,000), $(0.03) per common share. This compares with a loss of $(895,000), $(0.03) per share in the first quarter of 2005. On an operating basis, the loss for the quarter of ($490,000) represented a $349,000 increase over the $(141,000) in 2005. This increased operating loss reflects higher operating expense, $2,049,000, a $749,000, or 58% increase, compared to the prior period as the company implements strategic initiatives in sales and marketing and research and development that were only partially offset by the 29% volume increase and improved gross margins (49.9% versus 47.7% in the first quarter of 2005).
Sales and marketing expense, $761,000, represented an increase of $452,000, or 146% compared to the first quarter of 2005. Kirk Kamsler, Senior Vice President of Commercial Development commented, "At this time a year ago, our field sales organization was only seven individuals to support worldwide operations. We are delighted that we have been able to triple that in a year's time to a team of 21. It is our plan to continue to build our organization to support our existing products and in anticipation of acceptances from the 24 pending drug and device registrations."
Research & Development expense increased $89,000, 26% between periods to $427,000. Finance and Administration expense of $861,000 was $208,000 higher than the first quarter of 2005, a 32% increase. $118,000 of the total operating expense increase between periods reflects compliance with the new accounting regulations to expense options.
Balance Sheet
At March 31, 2006, the company had total current assets of $8.6 million with $0.2 million cash on hand. At the same time, MINRAD had current liabilities of approximately $6.6 million.
About the Company
MINRAD International, Inc. is an interventional pain management company with real-time image guidance and anesthesia and analgesia product lines. The real-time image guidance products facilitate minimally invasive surgery especially for pain management and have broad applications in orthopedics, neurosurgery, and interventional radiology. These devices enable medical professionals to improve the accuracy of interventional procedures and reduce radiation exposure. MINRAD International also manufactures and markets generic inhalation anesthetics for use in connection with human and veterinary surgical procedures. The company is developing a drug/drug delivery system for conscious sedation, which, similar to nitrous oxide in dental surgery, provides a patient with pain relief without loss of consciousness.
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terms such as "may," "intend," "might," "will," "should," "could," "would," "expect," "believe," "estimate," "anticipate," "predict," "project," "potential," or the negative of these terms, and similar expressions intended to identify forward-looking statement. Investors should not place undue reliance on the forward-looking statements contained in this news release. Each forward-looking statement speaks only as of the date on which it is made, and except as required by law, MINRAD International undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. Forward-looking statements are based on assumptions and estimates and are subject to risks and uncertainties. Important factors that could cause actual results to differ materially from those identified in the forward-looking statements in this news release include changes in general economic and political conditions and currency exchange rates; market factors, including competitive pressures and changes in pricing policies; changes in interpretations of existing legislation or the adoption of new legislation; loss of major customers; the occurrence of litigation or claims; natural and manmade disasters, including acts of terrorism or war; and other factors described in the "Risk Factors" and "Cautionary Factors That May Affect Future Results" sections of MINRAD International's Form 10-KSB, filed with the Securities and Exchange Commission on March 31, 2005.
Contact: Kirk Kamsler
Senior Vice President, Commercial Development
716-855-1068
MINRAD INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
1st Quarter Ended March 31,2006 COMPARED TO 1st Quarter Ended March 31, 2005
IN THOUSANDS UNAUDITED
FAVORABLE FAVORABLE
2006 2005 (UNFAVORABLE)(UNFAVORABLE)
Revenue $3,123 $2,429 $694 29%
Cost of goods sold
Standard Cost of Sales 1,240 956 (284) (30)%
Manufacturing Variances 324 314 (10) (3)%
1,564 1,270 (294) (23%)
Gross profit 1,559 1,159 400 35%
GP % 49.9% 47.7% 2.2 pts
Operating expenses:
Sales and marketing 761 309 (452) (146%)
Research and development 427 338 (89) (26%)
Finance and administrative 861 653 (208) (32%)
Total operating expenses 2,049 1,300 (749) (58%)
Operating loss (490) (141) (349) (248%)
Interest expense: other (75) (62) (13) (21%)
Interest expense:
shareholder 0 (692) 692 100%
Net Loss $(565) $(895) $330 37%
Less Preferred Stock Dividends
Non cash dividends (183) -- (183) NA
Net loss available for common
stockholders $(748) $(895) $147 16%
Net Loss per share $(0.03) (0.03) 0.00 0%
Weighted average common shares
outstanding 29,125 28,237 888 3%
MINRAD INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
IN THOUSANDS UNAUDITED
ASSETS March 31, March 31,
2006 2005
Current Assets
Cash, and cash equivalents $213 $135
Accounts receivable, net 3,701 1,662
Inventories, net 3,645 1,004
Prepaid expenses & other 1,027 405
Total current assets 8,586 3,206
Net property and equipment 1,561 536
Other Assets 233 368
Total Assets 10,380 4,110
LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)
Current Liabilities:
Demand notes payable $3,120 $2,737
Accounts payable 2,741 1,800
Dividends Payable 181 0
Accrued expenses 561 811
Due to affiliates -- 308
Current portion of long-term including
default reclassifications -- 843
Total current liabilities 6,603 6,499
Stockholder's Equity (Deficit) 3,777 (2,389)
Total Liabilities & Equity $10,380 $4,110
MINRAD INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
IN THOUSANDS UNAUDITED
Quarter Quarter
Ended Ended
March 31, March 31,
2006 2005
Cash flows from operating activities:
Net loss $(565) $(895)
Adjustments to reconcile net loss to net
Cash used by operating activities: 22 (867)
Net cash used by operating activities (543) (1,762)
Net cash used by investing activities (143) (108)
Net cash provided by financing activities 229 2,002
Net increase (decrease) in cash and cash
equivalents (457) 132
Cash and cash equivalents - beginning of period 670 3
Cash and cash equivalents - end of period $213 $135
