CRH Medical Announces First Quarter 2014 Results
VANCOUVER, April 23, 2014 /CNW/ - CRH Medical Corporation (TSX: CRH) (OTCQX: CRMMF), a North American medical company focussed on providing physicians with innovative products for the treatment of gastrointestinal diseases, today announced its unaudited financial results for the first quarter ended March 31, 2014. All financial results are expressed in U.S dollars.
First Quarter Financial Highlights
|(in 000's of US$)||Q1 2014||Q1 2013||Change|
|Total operating expenses||$1,429||$1,562||-8.5%|
|Net income before taxes||$562||$274||+106%|
"The first 90 days of 2014 marked another strong and consistent quarter for CRH," said Edward Wright, Chief Executive Officer of CRH Medical. "Both our revenue and net income were higher compared to the same period last year."
The Company's product, the O'Regan System is a single use, disposable, hemorrhoid treatment that is safe and highly effective in treating hemorrhoid grades I - IV. CRH Medical's goal is to establish the O'Regan System as the standard of care for hemorrhoid treatment. In addition to the product, the Company delivers clinical, marketing and operational support directly to its partner physicians.
Revenues for the three months ended March 31, 2014 were $1,991,224 compared to $1,835,782 for the three months ended March 31, 2013. The increase in product sales revenue is the direct result of the Company's continued successful execution in identifying, training and supporting gastroenterologists in their diagnosis and treatment of hemorrhoids. The CRH O'Regan System includes our hemorrhoid banding technology, treatment protocols, marketing and operational support.
Product sales expenses for the three months ended March 31, 2014 were $904,903 compared to $1,158,578 for the three months ended March 31, 2013. The decrease in product sales expenses is a result of the decrease in expenses related to the Company's Clinical Sales Program. Product sales expenses primarily include employee wages, product cost and support, marketing programs, office expenses, professional fees, and insurance. Product sales expenses also include non-cash stock based compensation and depreciation totaling $37,988 for the three months ended March 31, 2014 compared to $53,641 for the three months ended March 31, 2013. In the future, the Company expects to continue to invest in activities to increase demand for trainings and use of the CRH O'Regan System.
Corporate expenses for the three months ended March 31, 2014 were $523,997 compared to $403,680 for the three months ended March 31, 2013. The increase in corporate expenses is a result of increased professional fees and an increase in stock based compensation. Corporate and other expenses include non-cash stock based compensation and depreciation totaling $90,351 for the three months ended March 31, 2014 compared to $43,592 for the three months ended March 31, 2013. In the future, the Company expects corporate expenses of its current business to remain relatively constant.
For the three months ended March 31, 2014 the Company recorded tax expense of $193,935. In 2013, the Company assessed that the Canadian entity will have future profitability and therefore recognized a deferred tax asset of $692,851. The tax expense for the current period reduces the deferred tax asset and does not represent a cash expense for the Company. In future periods, when the deferred tax asset is depleted, the Company will be required to pay taxes.
For the three months ended March 31, 2014, the Company recorded net income of $368,389 ($0.008 basic and $0.007 diluted income per share) compared to a net income of $273,524 ($0.006 basic and diluted income per share) for the three months ended March 31, 2013. Net income for the three months ended March 31, 2014 includes income tax expense of $193,935 compared to $nil for the three months ended March 31, 2013.
As at March 31, 2014, the Company had $7,363,095 in cash and cash equivalents compared to $6,602,798 as at December 31, 2013. At March 31, 2014, working capital was $8,118,481 compared to working capital of $7,399,110 as at December 31, 2013.
First Quarter, 2014 Conference Call Notification
CRH Medical will host a telephone conference call to discuss the quarter on April 24, 2014 at 10:00 am Eastern Time. The telephone numbers for the conference call are (888) 231-8191 or (647) 427-7450.
At the call's completion, an audio replay will be available by calling (855) 859-2056 or (416) 849-0833 and using passcode 15868596. The phone replay will be available through May 8, 2014.
About CRH Medical Corporation:
CRH Medical Corporation is North American company focussed on providing physicians with innovative products for the treatment of gastrointestinal diseases. The Company's product, the CRH O'Regan System, is a single use, disposable, hemorrhoid treatment that is safe and highly effective in treating hemorrhoid grades I - IV. The O'Regan System is rapidly emerging as the standard of care with gastroenterologists who treat hemorrhoids. In addition to the product, CRH Medical delivers clinical, marketing and operational support directly to its partner physicians. CRH utilizes its web-based platform to connect doctors with patients as well as educating its ever increasing install base of physicians.
Forward looking statements:
The information in this news release contains so-called "forward-looking" statements. These include statements regarding CRH Medical's expectations and plans relating to its business, statements about CRH Medical's expectations, beliefs, intentions or strategies for the future, which may be indicated by words or phrases such as "anticipate", "expect", "intend", "plan", "will", "we believe", "CRH Medical believes", "management believes", and similar language. All forward-looking statements are based on CRH Medical's current expectations and are subject to risks and uncertainties and to assumptions made. Assumptions include: (i) that the growth of CRH's product sales will continue in a consistent manner; (ii) CRH's costs will not escalate significantly; and (iii) CRH does not incur any extraordinary costs.
While it is impossible to identify all such factors, factors that could cause actual results to differ materially from those estimated by us include: (i) We may not continue to attract gastroenterologists and other licensed providers to purchase and use the CRH O'Regan System; (ii) The policies of health insurance carriers in the United States may affect the amount of revenue the Company receives; (iii) Changes in United States federal or state laws, rules, and regulations; (iv) Our senior management has been key to our growth, and we may be adversely affected if we lose any member of our senior management; (v) Economic dependence on suppliers and our contract manufacturer; (vi) Changes in the industry and the economy may affect the Company's business; (vii) Evolving regulation of corporate governance and public disclosure may result in additional corporate expenses; (viii) We may be subject to competition and technological risk which may impact the price and amount of product we can sell; (ix) Adverse events relating to our product could result in loss of product sales, product liability, medical malpractice, insurance and product recalls; * We may need to raise additional capital to fund future operations; (xi) Our business may be impacted by health care reform in the United States; and (xii) We may not have the expertise required to expand internationally.
SOURCE CRH Medical CorporationFor further information:
Edward Wright, Chief Executive Officer
CRH Medical Corporation
Adam Peeler, Media and Investor Relations
416.815.0700 x 225