Victhom discloses second quarter 2008 financial results



    QUEBEC, Aug. 11 /CNW Telbec/ - Victhom Human Bionics Inc., (Victhom,
TSX: VHB), today reported its 2008 second quarter results.
    Mr. Normand Rivard, Acting President and CFO of Victhom said: "During the
second quarter of 2008, the Neurobionix business unit continued to make good
progress towards its objective to commercialize its first neuromodulation
product, the Neurostep(TM) in 2009". He added: "In parallel, the Biotronix
business unit will be completing the development of the second generation of
the Power Knee(TM) later this year that will feature significant improvements
as compared with the first generation of this motorized prosthesis already
available on the market". Finally, he said: "I am happy to report that both
business units have a clear line of sight to product market introduction".

    Second Quarter Results

    For the three-month period ended on June 30, 2008, the Company recorded
revenues of $582,548 compared with $547,854 in 2007, representing an increase
of $34,694 or 6.3%. Revenues for the six-month period ended on June 30, 2008,
were $1,156,791 compared with $1,108,089 for the same period in 2007,
representing an increase of $48,702 or 4.4%.
    The revenues for the six-month period ended on June 30, 2008 are composed
of non-refundable advance royalties for an amount of $1,085,747 ($1,103,267 in
2007), of support activities for an amount of $25,354 ($0 in 2007), and of
other sources for an amount of $45,690 ($4,822 in 2007). Revenues are mostly
derived from a European medical device company located in Iceland. For the
six-month period ended on June 30, 2008, compared to the same period in 2007,
U.S. dollar currency fluctuations had an unfavorable impact on our revenues of
$147,784.
    R&D expenses, before tax credits and grants, amounted to $3,881,221 for
the three-month period ended on June 30, 2008, compared with $2,118,042 for
the same period in 2007, representing an increase of $1,763,179 or 83.2%. For
the six-month period ended on June 30, 2008, R&D expenses, before tax credits
and grants, amounted to $6,157,529 compared with $4,102,220 for the same
period in 2007, representing an increase of $2,055,309 or 50.1%. For the
second quarter and the first six-month period of 2008, the increase can be
explained by the $1,261,338 non-cash write-down of intangible asset related to
none-core projects in the Neurobionix business unit. The balance of the
increase is mainly related to the ongoing clinical trial and the development
of the commercial version of the Neurostep(TM).
    G&A expenses, net of non-cash stock-based compensation charges of
$26,393, for the three-month period ended on June 30, 2008, amounted to
$486,262 compared with $680,009 for the same period in 2007, representing a
decrease of $193,747 or 28.5%. For the six-month period ended on June 30,
2008, G&A expenses, net of non-cash stock-based compensation charges of
$50,649, amounted to $1,347,956 compared with $1,283,985 for the same period
in 2007, representing an increase of $63,971 or 5.0%. The increase in G&A
expenses is mainly due to the non-recurring financing charges of $324,503
offset by a decrease of $260,532 mainly due to staff reduction in
administrative functions and lower administrative expenses.
    Financial expenses for the three-month period ended on June 30, 2008
amounted to $593,567 compared with $494,194 for the same period in 2007,
representing an increase of $99,373 or 20.1%. For the six-month period ended
on June 30, 2008, financial expenses amounted to $1,114,714 compared with
$1,001,571 for the same period in 2007, representing an increase of $113,143
or 11.3%. The increase is mainly explained by lower interest income on cash
and cash equivalents and higher interest on convertible debentures. The
financial expenses are mainly the result of interest fees in connection with
the issuance of a 7% convertible unsecured debenture on March 22, 2005.
    Consolidated net loss for the three-month period ended on June 30, 2008
amounted to $4,153,547 compared with $2,647,037 for the same period in 2007,
representing an increase of $1,506,510 or 56.9%. The net loss, net of non-cash
charges of $2,166,358, for the three-month period ended on June 30, 2008
amounted to $1,987,189 compared to a net loss, net of non-cash charges of
$941,845, for the same period in 2007, which amounted to $1,705,192,
representing an increase of $281,997 or 16.5%.
    For the six-month period ended on June 30, 2008, the net operational
results amounted to $6,921,865 compared with $4,901,345 for the same period in
2007, representing an increase of $2,020,520 or 41.2%. The net loss, net of
non-cash charges of $3,021,812, for the six-month period ended on June 30,
2008, amounted to $3,900,053 compared to a net loss, net of non-cash charges
of $1,736,838, for the same period in 2007, which amounted to $3,164,507,
representing an increase of $735,546 or 23.2%. The increase in net loss, net
of non-cash charges, is mainly the result of higher R&D expenses related to
the ongoing clinical trial and the development of the commercial version of
the Neurostep(TM).
    Shareholders' equity amounted to $3,457,736 on June 30, 2008, compared
with $9,620,761 on December 31, 2007. Total assets amounted to $20,495,652 on
June 30, 2008, compared with $26,013,384 on December 31, 2007.

    Financial Situation

    As of June 30, 2008, the Company had a cash and cash equivalents position
of $7.9 million compared with $12.4 million as of December 31, 2007. The
decrease was mainly driven by the net loss (after adding back non-cash
adjustments) of $3,900,053 and by changes in the working capital items. The
Company believes that with its current financial resources it will have
sufficient liquidity to support its cash flow requirements for at least the
next twelve months.
    On June 30, 2008, the number of common shares outstanding totaled
100,904,277 while 6,708,000 options were granted under the stock option plan
and 25,964,942 share purchase warrants are in circulation pursuant to past
unit offerings. The outstanding options and share purchase warrants are
exercisable respectively at a weighted average exercise price of $0.41 and
$0.76 per share.

    About Victhom

    Victhom discovers, develops and manufactures bionic devices involved in
the treatment of a variety of physical and physiological dysfunctions.
Victhom's Neurobionix business unit focuses on the development and
commercialization of technologies and products involving implantable devices
that feature neurosensing and neurostimulation components, integrated with
artificial intelligence. Victhom's Biotronix business unit develops
biomechatronic products to support or replace peripheral limbs in what is
known as the orthotics and prosthetics 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.




For further information:

For further information: Normand Rivard, Acting President & CFO, Victhom
Human Bionics Inc., (418) 872-5665, Fax: (418) 872-6926,
normand.rivard@victhom.com, www.victhom.com; Source: Victhom Human Bionics
Inc.

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Victhom Human Bionics Inc.

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