Victhom discloses third quarter 2011 financial results

QUEBEC, Nov. 29, 2011 /CNW Telbec/ - Victhom Human Bionics Inc. ("Victhom") (TSXV: VHB) today reported its third quarter 2011 f inancial results.

Mr. Normand Rivard, President and CEO of Victhom, said: "We are happy to report that in conjunction with the increase in revenues coming from royalties on the sales of the Power Knee, our partner Ossur confirmed that the product full commercial launch would take place before the end of the year.  Ossur also reported positive results from the Power Knee case studies performed at Walter Reed Army Medical Center in Washington DC, an important milestone that helps to prove the benefits of the product". He added: "Following the sale of our participation in Neurotream in the second quarter of this year, Victhom is currently evaluating various business development opportunities to redefine its future activities and create value for its shareholders beyond the royalty potential from the leading-edge products developed to date".

On June 30, 2011, the Company sold its 44.4% participation in Neurostream to a related party to its joint venture partner Otto Bock Healthcare for an aggregate consideration of $10 million in cash as well as the payment of royalties on the future net sales of the Neurostep® System and eventual monetization proceeds of the sleep apnea and epilepsy technologies of Neurostream.

Third Quarter Results

For the quarter ended on September 30, 2011, the Company recorded revenues of $19,673 compared with $10,914 for the same period in 2010, representing an increase of $8,759 or 80.3%. The revenues for the nine-month period ended on September 30, 2011 were generated from royalties on the Power Knee for an amount of $70,853 ($38,705 in 2010). There was $2,482 of revenues generated from other sources in 2010 while there was none for the same period in 2011.

At this time, the Company does not expect to engage in additional and new R&D activities in the near future.

For the quarter ended on September 30, 2011, the Company recorded a negative adjustment to its tax credits of $139,525 compared with tax credits earned of $128,771 for the same period in 2010, representing a decrease in tax credits of $268,296 or 208.4%. The decrease is due to an adjustment made on our 2010 investment tax credits receivable to reflect the actual amounts claimed on Neurostream's R&D activities. We also adjusted our 2011 investment tax credits receivable on the same basis.

For the nine-month period ended on September 30, 2011, tax credits amounted to $60,310 compared with $1,312,141 for the same period in 2010, representing a decrease of $1,251,831 or 95.4%. The decrease is mainly explained by amended tax credit claims from previous years for which the Company received positive confirmation and payment from tax authorities in May 2010. The Company had not recognized these investment tax credits in previous quarters since the government ruling on the nature of the claim was uncertain.

G&A expenses, for the three-month period ended on September 30, 2011, amounted to $244,808 compared with $188,908 for the same period in 2010, representing an increase of $55,900 or 29.6%. For the nine-month period ended on September 30, 2011, G&A expenses amounted to $689,734 compared with $1,031,199 for the same period in 2010, representing a decrease of $341,465 or 33.1%. The decrease in G&A expenses is mainly due to non-recurring professional fees related to amended investment tax credits, received during the second quarter of 2010.

For the three-month period ended on September 30, 2011, the consolidated net loss amounted to $1,586,375 compared with a net loss of $1,310,793 for the same period in 2010, representing an increase in net loss of $275,582 or 21.0%. The consolidated net income amounted to $8,284,495 for the nine-month period ended on September 30, 2011, compared with a net loss of $4,458,105 for the same period in 2010, representing an increase in net income of $12,742,600 or 285.8%. The increase in net income is mainly explained by the gain on disposal of our interest in joint venture and lower G&A expenses, which were partially offset by lower investment tax credits and an exchange rate loss on preferred shares.

Shareholders' equity amounted to $3,073,664 on September 30, 2011, compared with a shareholders' deficiency of $4,821,720 on December 31, 2010. Total assets amounted to $8,567,774 on September 30, 2011, compared with $7,032,818 on December 31, 2010.

Financial Situation

As of September 30, 2011, the Company had $2,523,574 in cash and cash equivalents. For the nine-month period ended on September 30, 2011, the net increase in cash was $3,228,274 compared with a net decrease of $654,475 for the same period in 2010. During the first nine months of 2011, the cash was mainly provided by the disposal of our interest in Neurostream joint venture, which was partially offset by cash used for the redemption of a portion of our Series A preferred shares.

As of November 25, 2011, the Company had $2,333,860 in cash and cash equivalents.

On November 28, 2011, the number of common shares outstanding totaled 19,297,655 while 167,000 options were outstanding under the stock option plan. The outstanding options are exercisable at a weighted average exercise price of $5.34 per share. On November 28, 2011, the number of Series A preferred shares outstanding totaled 12,611,220, for a redemption amount of US$ 8,323,405, which can be converted into common shares, at any time and from time to time, at the holder's option on a 1-for-1 basis.

About Victhom

Victhom is a company which owns patents in the field of orthotics and prosthetics ("O&P"), including intellectual property used in the Power Knee, the world's first and only motor-powered prosthesis for above-knee amputees, a product distributed under license agreement by Ossur, a global leader in the O&P market. The Company also has a royalty agreement related to the Neurostep® System and neuromodulation products in other indications (sleep apnea and epilepsy) using the Neurobionix technology platform currently under development by Neurostream Technologies, a General Partnership now owned by Otto Bock, a global leader in the O&P market.

FORWARD-LOOKING STATEMENTS

Some of the statements made herein may constitute forward-looking statements. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause Victhom's actual results, performance or achievements to be materially different from those expressed or implied by any of Victhom's statements. Actual events or results may differ materially. We disclaim any intention, and assume no obligation, to update these forward-looking statements.

SOURCE VICTHOM HUMAN BIONICS INC.

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Source:  Victhom Human Bionics Inc.
   
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Normand Rivard
President & CEO
Victhom Human Bionics Inc.
Tel.: (438) 380-5244
Fax: (438) 381-1530
normand.rivard@victhom.com
www.victhom.com

 

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VICTHOM HUMAN BIONICS INC.

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