Hamilton Thorne announces 2010 first quarter results

TSX VENTURE: HTL

TORONTO, May 19 /CNW/ - Hamilton Thorne Ltd. (TSX-V: HTL), a leading provider of advanced laser systems and instruments for the stem cell research and fertility clinic markets, today reported operational and financial results for the first quarter ended March 31, 2010.

"Our family of products continues to expand to meet the needs of the rapidly growing regenerative medicine market worldwide," said Meg Spencer, Chief Executive Officer of Hamilton Thorne Ltd. "The recently launched HAWK-i(TM), which allows researchers to monitor experiments remotely, is one such solution that helps to support the ongoing innovation in stem cell research and can be sold by the same sales team, into the same lab, as an extension of our portfolio of lab products. Expanding our product base is only the first step for our future success that will be followed in lockstep, by a thrust in the area of sales and distribution where we plan to add further distribution partners to augment our internal sales effort in the coming quarters."

First Quarter Highlights

    
    -   Launched the HAWK-i(TM) remote monitoring system with the first major
        installation of the system at an Ivy League university.
    -   Signed a Master Service Agreement with Cambridge Technology
        Enterprises (CTE), a global business and technology services company,
        to develop customized applications and manage the infrastructure of
        the Company's HAWK-i(TM) system for enterprise-wide installations.
    -   Appointed Michelle Lyles, Ph.D., to the role of Vice President of
        Sales with responsibility for managing Hamilton Thorne's worldwide
        sales initiatives and overseeing the Company's sales team and
        distributor relationships. Dr. Lyles brings more than 15 years of
        experience in progressively senior Sales and Marketing roles for life
        science research companies.
    

Financial Results

All amounts are in US dollars, unless specified otherwise, and results expressed in accordance with Canadian Generally Accepted Accounting Principles (GAAP).

For the three months ended March 31, 2010, the Company recorded sales of $1,180,687, compared to $1,115,554 for the same period last year. During the first quarter Hamilton Thorne generated sales increases from its existing products, supported by continued strong demand in Asia and the initial installation of its new Hawk-i(TM) product in the US. Given the current instability and currency fluctuations in Europe, the Company continues to focus its major sales efforts in Asia, particularly in China where the economy continues to be strong, and in North America, where demand is growing, in part as a result of the release of additional NIH funding for stem cell research.

Cost of sales for the three months ended March 31, 2010 was $470,486, compared to $418,861 for the same period last year. The gross profit as a percent of sales declined slightly from 62.5% for 2009 to 60.2% for 2010. This decrease was primarily due to certain lower margin accessories sold in connection with Hamilton Thorne's initial Hawk-i(TM) installation.

For the three months ended March 31, 2010, total operating expenses were $1,189,377, compared to $1,001,773 for the same period last year. Research and development expenses increased to $250,307 from $176,773 for the same period last year due primarily to a general increase in third party development contracts and patent costs. General and administrative expenses increased from $382,465 to $453,383 for the same period last year due primarily to the increase in stock compensation costs and public company expenses. For the three months ended March 31, 2010, sales and marketing expenses increased from $442,535 to $485,687 for the same period last year, primarily due to additional compensation expenses. The increase in operating expenses in research and development, and sales and marketing reflect the Company's continued execution of its strategic plan.

The net loss for the quarter ended March 31, 2010 was $549,125, an increase from the net loss of $389,476 for the same period of the previous year. The increase in net loss was due to the planned expansion of sales and marketing efforts, accelerated product development and public company expenses.

As at March 31, 2010, the Company's cash and cash equivalents amounted to $696,343.

As of March 31, 2010 the Company had 24,415,157 common shares, 5,500,005 warrants, 3,532,756 options, and 440,001 agent compensation options outstanding.

The Company also announced that it has granted 10,000 stock options to a director pursuant to its stock option plan. The options are exercisable at $0.24 CDN per common share, vesting quarterly over three years with an expiry ten years from the date of grant.

The financial statements are available on www.sedar.com.

About Hamilton Thorne Ltd.

Hamilton Thorne's advanced laser systems and instruments are rapidly emerging as the dominant products to facilitate precise procedures in the stem cell research and fertility clinic markets. Hamilton Thorne's lead products, the ZILOS-tk and XYClone laser systems, attach to standard inverted microscopes and operate as robotic micro-surgeons, significantly reducing time and increasing efficiency in key in-vitro fertilization, stem cell, embryo, reproductive toxicology and living cell procedures.

Hamilton Thorne's growing customer base includes pharmaceutical companies, biotechnology companies, fertility clinics, university research centers and other commercial and academic research establishments worldwide. Current customers include world-leading research labs such as Harvard, MIT, Yale, DuPont, Monsanto, Charles River Labs, Jackson Labs, Merck, Novartis, Pfizer, Oxford and Cambridge. For more information on Hamilton Thorne, visit www.hamiltonthorne.com.

Neither the exchange nor its regulation services provider (as that term is defined in the policies of the exchange) accepts responsibility for the adequacy or accuracy of this release.

Certain information in this press release may contain forward-looking statements. This information is based on current expectations that are subject to significant risks and uncertainties that are difficult to predict. Actual results might differ materially from results suggested in any forward-looking statements. The Company assumes no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those reflected in the forward looking-statements unless and until required by securities laws applicable to the Company. Additional information identifying risks and uncertainties is contained in filings by the Company with the Canadian securities regulators, which are available at www.sedar.com.

Financials results included below:

    
                                                         Hamilton Thorne Ltd
                                                 Consolidated Balance Sheets
                                  As at March 31, 2010 and December 31, 2009
                                      (Expressed in U.S. Dollars - unaudited)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2010          2009
    -------------------------------------------------------------------------

    Assets
    Current
      Cash and cash equivalents                        696,343     1,356,371
      Accounts receivable                              581,966       499,875
      Inventories                                      511,991       512,300
      Prepaid expenses and other current assets         41,925        72,689
      Note receivable, officer                          24,023        23,813
    -------------------------------------------------------------------------
                                                     1,856,248     2,465,048
      Capital assets                                   114,449        90,481
      Other assets                                     127,555        72,454
    -------------------------------------------------------------------------
                                                     2,098,252     2,627,983
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities
    Current
      Accounts payable and accrued liabilities       1,153,930     1,171,562
      Notes payable                                     81,049        83,037
      Capital lease obligations, current                 5,753         5,753
      Deferred revenue                                  38,798        35,881
    -------------------------------------------------------------------------
                                                     1,279,530     1,296,233
      Capital lease obligations, non-current             6,251         7,904
      Long-term debt                                 5,048,000     5,050,000
    -------------------------------------------------------------------------
                                                     6,333,781     6,354,137
    -------------------------------------------------------------------------

    Shareholders' Equity (Deficiency)
      Common shares                                 24,341,938    24,341,938
      Warrants                                         344,949       344,949
      Contributed surplus                              239,517       199,767
      Accumulated deficit                          (29,161,933)  (28,612,808)
    -------------------------------------------------------------------------
                                                    (4,235,529)   (3,726,154)
    -------------------------------------------------------------------------
                                                     2,098,252     2,627,983
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



                                                         Hamilton Thorne Ltd
    Consolidated Statements of Operations and Comprehensive Loss and Deficit
                          For the three months ended March 31, 2010 and 2009
                                      (Expressed in U.S. Dollars - unaudited)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2010          2009
    -------------------------------------------------------------------------

    Sales                                            1,180,687     1,115,554
    Cost of sales                                      470,486       418,861
    -------------------------------------------------------------------------
                                                       710,201       696,693
    -------------------------------------------------------------------------
    Expenses
      Research and development                         250,307       176,773
      Sales and marketing                              485,687       442,535
      General and administrative                       453,383       382,465
    -------------------------------------------------------------------------
                                                     1,189,377     1,001,773
    -------------------------------------------------------------------------

    Loss from operations                              (479,176)     (305,080)

    Other income (expense)
      Interest expense including accretion             (70,159)      (84,605)
      Interest income                                      210           209
    -------------------------------------------------------------------------

    Net loss and comprehensive loss                   (549,125)     (389,476)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Accumulated deficit at December 31:            (28,612,808)  (27,225,220)

    Accumulated deficit at March 31:               (29,161,933)  (27,614,696)

    Loss per share
      Basic                                             $(0.02)       $(0.02)
      Diluted                                           $(0.02)       $(0.02)

    Weighted average number of common shares
     outstanding
      Basic                                         24,415,157    16,035,067
      Diluted                                       24,463,307    16,035,067



                                                         Hamilton Thorne Ltd
                                       Consolidated Statements of Cash Flows
                          For the three months ended March 31, 2010 and 2009
                                      (Expressed in U.S. Dollars - unaudited)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
                                                          2010          2009
    -------------------------------------------------------------------------

    Cash flows from operating activities
    Net loss for the year                             (549,125)     (389,476)
    Adjustments to reconcile net loss to net cash
     used in operating activities:
      Depreciation and amortization                     15,027        29,451
      Non-cash interest expense/accretion                    -        37,481
      Share-based compensation expense                  39,750         9,750
      Changes in non-cash operating assets and
       liabilities:
        Accounts receivable                            (82,091)      445,330
        Inventories                                        309         6,259
        Prepaid expenses and other current assets       30,554        15,752
        Other assets                                   (57,000)       (1,668)
        Accounts payable and accrued liabilities       (17,632)     (138,098)
        Deferred revenue                                 2,917        (9,125)
    -------------------------------------------------------------------------
                                                      (617,291)        5,656
    -------------------------------------------------------------------------

    Cash flows from investing activities
      Purchase of capital assets                       (37,096)      (41,524)
    -------------------------------------------------------------------------

    Cash flows from financing activities
      Proceeds from debt                               498,043       170,000
      Payments on debt                                (503,684)     (112,422)
    -------------------------------------------------------------------------
                                                        (5,641)       57,578
    -------------------------------------------------------------------------

    Net Increase (decrease) in cash and cash
     equivalents                                      (660,028)       21,710
    Cash and cash equivalents, beginning of period   1,356,371         5,029
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of period           696,343        26,739
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

SOURCE Hamilton Thorne Ltd.

For further information: For further information: David Wolf, President, Hamilton Thorne Ltd., (978) 299-1715, ir@hamiltonthorne.com; Ross Marshall, The Equicom Group, (416) 815-0700 x238, rmarshall@equicomgroup.com

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