NUCRYST announces 2009 second quarter financial results



    PRINCETON, NJ, Aug. 5 /CNW/ - NUCRYST Pharmaceuticals Corp., a developer
and manufacturer of medical products that fight infection and inflammation,
today announced its financial results for the second quarter of 2009.
    For the quarter ended June 30, 2009, NUCRYST reported a net loss of $0.4
million, or $0.02 cents per share, on revenues of $4.9 million. This compares
to a net loss of $1.7 million, or $0.09 cents per share, on revenues of $4.7
million in the second quarter of 2008.
    At June 30, 2009, NUCRYST had $11.8 million in cash and cash equivalents,
compared to $23.4 million at December 31, 2008. In the first quarter of 2009,
NUCRYST completed a $14.7 million, or $0.80 per share, cash distribution to
NUCRYST shareholders.
    "We are pleased with the progress we are making in driving the Company
towards profitability," said David B. Holtz, Interim President and Chief
Executive Officer, and Chief Financial Officer of NUCRYST. "We remain focused
on managing the Company with a lower cost structure while continuing to
explore longer term strategic alternatives for the business."
    David McDowell, NUCRYST's Vice President, Operations, added, "We are
fully prepared to support Smith & Nephew as they begin the US market launch of
the Acticoat(TM) Flex product line." Smith & Nephew and NUCRYST announced last
week that Smith & Nephew received FDA clearance for the new Acticoat(TM) Flex
product line.

    Second quarter financial analysis

    NUCRYST's total revenue for the second quarter of 2009, which consists of
wound care product revenues less the manufacturing cost rebate, increased to
$4.9 million compared to $4.7 million in the second quarter of 2008. The
increase was due to a higher level of product shipments in the current quarter
which was partially offset by slightly lower royalty revenues on Acticoat(TM)
sales reported by Smith & Nephew plc. Smith & Nephew's reported Acticoat(TM)
sales were negatively impacted by the strengthening U.S. dollar.
    Gross margin on product revenues was 43% in the second quarter of 2009,
compared to 42% in the second quarter of 2008. The improvement was primarily
due to reductions in per unit manufacturing costs which were partially offset
by a slight decrease in manufacturing prices charged to Smith & Nephew.
NUCRYST recognizes manufacturing revenue when NUCRYST ships product to Smith &
Nephew and recognizes royalty income when Smith & Nephew sells Acticoat(TM)
products to its customers. Consequently, NUCRYST's gross margin percent may
vary from period to period due to differences in the timing of product
shipments to Smith & Nephew and the sale of that product by Smith & Nephew to
its customers.
    Research and development spending in the second quarter of 2009 totaled
$0.6 million compared to $1.5 million in second quarter of 2008. NUCRYST
completed the closure of its Wakefield, Massachusetts research operations in
the fourth quarter of 2008. NUCRYST has also eliminated spending on several
development programs until commercialization partners are secured for these
programs.
    General and administrative costs in the second quarter of 2009 totaled
$1.4 million compared to $2.2 million in the second quarter of 2008. The
decrease was primarily due to cost reductions achieved following the transfer
of the Company's U.S. headquarters to Princeton, New Jersey and a reduction in
administrative staff. The decline in the Canadian dollar relative to the U.S.
dollar also contributed to overall decrease in reported costs.
    Other income and expenses, which includes foreign exchange gains and
losses and interest income, was a net loss of $0.6 million for the second
quarter of 2009 as compared to a net loss of $0.1 million in the second
quarter of 2009. Changes in the U.S. dollar and Canadian dollar exchange rate
during the second quarter of 2009 resulted in unrealized currency gains on our
U.S. dollar working capital amounts held by our Canadian operations. All of
our revenues from Smith & Nephew are received in U.S. dollars.

    A conference call regarding NUCRYST's 2009 first quarter results is set
for today at 9 a.m. EST. To participate, please call the toll-free number 
1-800-731-5774. To listen to the call live on the Internet, please go to
http://www.nucryst.com/web_casts.htm.

    
                         (Financial Table Page Below)

    About NUCRYST Pharmaceuticals Corp.
    
    NUCRYST Pharmaceuticals Corp. (NASDAQ:   NCST; TSX: NCS) develops,
manufactures and commercializes medical products that fight infection and
inflammation using SILCRYST(TM), its patented atomically disordered
nanocrystalline silver technology. NUCRYST licensed world-wide rights for
SILCRYST(TM) wound care coating products to Smith & Nephew plc, which markets
these products in over 30 countries under their Acticoat(TM) trademark.
NUCRYST has developed its proprietary nanocrystalline silver in a powder form,
referred to as NPI 32101, for use in medical devices and as an active
pharmaceutical ingredient.
    A more detailed discussion of NUCRYST's 2009 second quarter results will
be available in our Quarterly Report on Form 10-Q for the quarter ended June
30, 2009 which will be available at www.sec.gov and www.sedar.com when filed.
NUCRYST filings are also available at www.nucryst.com/Regulatory_Filings.htm.

    
    All amounts in U.S. dollars
    SILCRYST(TM) is a trademark of NUCRYST Pharmaceuticals Corp.
    Acticoat(TM) is a trademark of Smith & Nephew plc
    

    The financial results in this news release are unaudited, and are not a
complete disclosure of our quarterly or results. This news release contains
forward-looking statements within the meaning of securities legislation in the
United States and Canada (collectively "forward-looking statements").
Forward-looking statements in this news release include, but are not limited
to, statements about: our strategy, future operations, prospects and plans of
management and our ability to achieve operating efficiencies and cost
reductions. With respect to the forward-looking statements contained in this
news release, readers are cautioned that numerous risks, uncertainties and
other factors could cause our actual results to differ materially from those
indicated in these statements including, but not limited to: future
shareholder actions with respect to our capitalization and strategic
direction; the performance of the stock markets generally; our ability to
satisfy regulatory and stock exchange standards and requirements to maintain
our exchange listings; the uncertainty of our future operating results, which
are likely to fluctuate; our reliance on and ability to maintain our
collaboration with Smith & Nephew; our reliance on sales of Acticoat(TM)
products with our SILCRYST(TM) coatings by Smith & Nephew; our ability to
achieve and sustain cost savings and operating efficiencies sufficient to
substantially offset the manufacturing cost rebate we have agreed to pay Smith
& Nephew; our ability to retain skilled and experienced personnel; the
availability, timing or likelihood of regulatory filings and approvals for our
new products and our ability to maintain regulatory compliance with respect to
our existing products; our ability to establish successful commercialization
programs, through corporate collaborations or otherwise, for our NPI 32101
barrier cream and other development programs; the impact of delays and
challenges with new product introductions, the impact of new product
introductions on the sales of existing products; changes in currency exchange
rates; changes in regulation or tax laws applicable to us; changes in general
economic and capital market conditions; other risks and uncertainties that
have not been identified at this time; and management's response to these
factors. Although we have attempted to identify the important risks,
uncertainties and other factors that could cause actual results or events to
differ materially from those expressed or implied in the forward-looking
statements in this release, there may be other factors that cause actual
results or events to differ from those expressed or implied in forward looking
statements. For a more thorough discussion of the risks associated with our
business, see the "Risk Factors" section in our Annual Report on Form 10-K for
the year ended December 31, 2008 and in our Quarterly Report on Form 10-Q for
the quarter ended June 30, 2009, once filed with the U.S. Securities and
Exchange Commission on EDGAR at www.sec.gov and with securities authorities in
Canada on SEDAR at www.sedar.com. All forward-looking statements are expressly
qualified in their entirety by this cautionary statement and NUCRYST disclaims
any intention or obligation to revise or update any forward-looking statements
whether as a result of new information, future developments or otherwise after
the date hereof.

    
    Condensed Consolidated Statements of Operations
    -----------------------------------------------

                                  Three Months             Six Months
                                  Ended June 30           Ended June 30
                                    2009        2008        2009        2008
                              ----------- ----------- ----------- -----------

    Revenue                   $    4,942  $    4,708  $    9,091  $    9,897
                              ----------- ----------- ----------- -----------
    Operating expenses:
      Cost of goods sold           2,801       2,726       5,034       6,826
      Research and development       599       1,463       1,348       2,950
      General and
       administrative              1,351       2,164       3,979       4,652
                              ----------- ----------- ----------- -----------
        Total operating
         expenses                  4,751       6,353      10,361      14,428
                              ----------- ----------- ----------- -----------
    Income/(Loss) from
     operations                      191      (1,645)     (1,270)     (4,531)

      Other income/(expenses)       (604)        (71)       (219)        637
                              ----------- ----------- ----------- -----------
    Net pre-tax loss                (413)     (1,716)     (1,489)     (3,894)
      Income tax expense               -           -           -           2
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------

    Net loss                  $     (413) $   (1,716) $   (1,489) $   (3,896)
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------

    Basic and diluted net
     loss per common share    $    (0.02) $    (0.09) $    (0.08) $    (0.21)
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------

    Dilutive weighted
     average common shares
     outstanding              18,324,458  18,374,506  18,323,168  18,372,299
                              ----------- ----------- ----------- -----------
                              ----------- ----------- ----------- -----------


    Selected Consolidated Balance Sheet Data
    ----------------------------------------
                                                       June 30   December 31
                                                          2009          2008
                              	                       ----------- -----------
    Cash and cash equivalents                         $  11,751   $   23,388
    Current assets                                       19,400       31,751
    Total assets                                         29,344       41,800
    Current liabilities                                   5,574        2,949
    Non-current liabilities                                 474          495
    Shareholders' equity                                 23,296       38,356
    

    %SEDAR: 00023031E




For further information:

For further information: David B. Holtz, Interim President and Chief
Executive Officer, Chief Financial Officer, NUCRYST Pharmaceuticals Corp.,
(609) 228-8210; David Wills, Gillian McArdle, Investor Relations, (416)
504-8464, info@nucryst.com

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