HALIFAX, March 31, 2014 /CNW/ - MedMira, Inc. (MedMira) (TSXV: MIR), reported today on its financial results for the three and six month periods ended January 31, 2014.
MedMira revenue increased in the second quarter by 9.7% compared to the first quarter, primarily due to an increase in the Company's services revenue derived from the two product development and commercialization projects for the U.S. military. As these projects approach the final phase with FDA submissions forthcoming, related sales and marketing activities and expenditures increased during the quarter to support pre-launch activities as well as MedMira's newest U.S. sales and distribution channel and ongoing international business development initiatives.
The Company added a number of key resources during the quarter to facilitate corporate growth strategy initiatives. MedMira International AG became operational in the second quarter and serves as a hub for all commercialization activities including the pursuit of business development and sales opportunities. During this quarter, the Company started the implementation of a company-wide enterprise resource planning (ERP) system from SAP. The system will transform the finance function and add financial transparency in every aspect of the Company's activities. The implementation is expected to conclude by the end of the third quarter. MedMira is also advancing on the implementation of manufacturing automation at its facility in Halifax, Nova Scotia.
Second Quarter Financial Highlights
- The Company recorded revenue in the quarter from products and services totalling $518,715, as compared to revenue from products, services and royalties of $533,592 for the same period last year.
- MedMira's product revenue in the quarter was $103,649 as compared to revenue of $220,426 for the same period last year. Gross profit margin on product sales for the quarter was 55.4% compared to 33.4% in the same period last year. The decline in product sales stems from a delay in government tenders from the Asia Pacific region during this quarter. Official launch activities related to Reveal G3 and the Miriad line of products in the US were completed near the end of the quarter and the sales momentum was not yet realized.
- The Company recorded service revenue of $415,066 with a related gross margin of $145,163 compared to service revenues of $277,806 and related gross margin of $86,202 in the same period last year. Service revenue is expected to grow in the U.S. market as the clinical trials and related services increase in preparation for the FDA submissions.
- Total operating expenses for this quarter were $1,358,497, an increase of $621,588 over the same period last year. The increase in operating expenses reflects the investment being made across the organization to aggressively advance the Company's corporate strategic growth plan. There was a rise in R&D expenses ($129,681) related to clinical trials. The increase in Sales & Marketing expenses for the quarter ($215,569) included expenses for a new marketing campaign in the U.S. to launch and promote the Miriad product line and were in line with the expansion activities in the U.S. to introduce new products and train distributors. An increase in General & Administrative expenses ($170,254) is attributed to one-time fees covering the set-up of MedMira International AG, the implementation of a new ERP system from SAP, and filing new patents in key markets. An increase in Other Direct costs ($106,084) is attributed to production improvements and additional contract labour.
MedMira is a leading developer and manufacturer of vertical flow rapid diagnostics. The Company's tests provide hospitals, labs, clinics and individuals with instant diagnosis for diseases such as HIV and hepatitis C in just three easy steps. The Company's tests are sold under the Revealâ, Multiplo™ and Miriad™ brands in global markets. Based on its patented Rapid Vertical Flow Technology™, MedMira's rapid HIV test is the only one in the world to achieve regulatory approvals in Canada, the United States, China and the European Union. MedMira's corporate offices and manufacturing facilities are located in Halifax, Nova Scotia, Canada. For more information visit medmira.com.
This news release contains forward-looking statements, which involve risk and uncertainties and reflect the Company's current expectation regarding future events including statements regarding possible approval and launch of new products, future growth, and new business opportunities. Actual events could materially differ from those projected herein and depend on a number of factors including, but not limited to, changing market conditions, successful and timely completion of clinical studies, uncertainties related to the regulatory approval process, establishment of corporate alliances and other risks detailed from time to time in the company quarterly filings.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: MedMira Inc.
For further information:
Andrea Young, Corporate Communications