Encision Reports Fourth Quarter Fiscal Year 2018 Results
Encision Reports Fourth Quarter Fiscal Year 2018 Results
BOULDER, Colo., May 7, 2018 /PRNewswire/ -- Encision Inc. (OTC:ECIA), a medical device company owning patented surgical technology that prevents dangerous stray electrosurgical burns in minimally invasive surgery, today announced financial results for its fiscal 2018 fourth quarter that ended March 31, 2018.
The Company posted quarterly net revenue of $2.04 million for a quarterly net loss of $18 thousand, or $0.00 per diluted share. These results compare to net revenue of $2.21 million for a quarterly net loss of $115 thousand, or $(0.01) per diluted share, in the year-ago quarter. Net revenue for the current quarter included net revenue of $68 thousand from an order for non-AEM product. Gross margin on net revenue was 57% in the fiscal 2018 fourth quarter and 52% in the fiscal 2017 fourth quarter. Gross margin on net revenue was higher in the current quarter as a result of product mix. Gross margin on net revenue was lowered further in last year's fourth quarter by applying overhead costs to faster turnover inventory.
The Company posted twelve months net revenue of $8.75 million for a twelve months net income of $336 thousand, or $0.03 per diluted share. These results compare to net revenue of $8.87 million for a twelve months net loss of $729 thousand, or $(0.07) per diluted share, in the year-ago twelve months. Net revenue for the current twelve months included net revenue of $492 thousand from an order for non-AEM product. Gross margin on net revenue was 57% in the fiscal 2018 twelve months and 50% in the fiscal 2017 twelve months. Gross margin on net revenue was higher in the current twelve months as a result of product mix. Gross margin on net revenue was lowered further in the fiscal 2017 twelve months by higher slow moving and obsolete inventory costs and applying overhead costs to faster turnover inventory.
Net cash of $420 thousand was generated by operating activities in the current twelve months compared to $23 thousand of cash generated by operating activities in last year's twelve months.
"This past year has been a turning point for Encision," said Greg Trudel, President and CEO of Encision. "We delivered new levels of operational excellence, launched new products and delivered black ink on the bottom line for the first time in recent history. Our focus going forward will be to grow the top line. To that effect, we have already strengthened our sales channel with direct sales representation to fill strategic gaps in the marketplace and to eliminate underperforming distribution relationships. We have a number of products in development and we are always open to partnering on OEM opportunities and licensing. We look forward to advancing the awareness of the risks of Stray Energy and to driving increased deployment of life saving AEM® Technology."
Encision Inc. designs and markets a portfolio of high performance surgical instrumentation that delivers advances in patient safety with AEM technology, surgical performance, and value to hospitals across a broad range of minimally invasive surgical procedures. Based in Boulder, Colorado, the company pioneered the development and deployment of Active Electrode Monitoring, AEM technology, to eliminate dangerous stray energy burns during minimally invasive procedures. For additional information about all our products, please visit www.encision.com.
In accordance with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, the Company notes that statements in this press release and elsewhere that look forward in time, which include everything other than historical information, involve risks and uncertainties that may cause actual results to differ materially from those indicated by the forward-looking statements. Factors that could cause the Company's actual results to differ materially include, among others, its ability to develop new or enhanced products and have such products accepted in the market, its ability to increase net sales through the Company's distribution channels, its ability to compete successfully against other manufacturers of surgical instruments, insufficient quantity of new account conversions, insufficient cash to fund operations, delay in developing new products and receiving FDA approval for such new products and other factors discussed in the Company's filings with the Securities and Exchange Commission. Readers are encouraged to review the risk factors and other disclosures appearing in the Company's Annual Report on Form 10-K for the year ended March 31, 2017 and subsequent filings with the Securities and Exchange Commission. We do not undertake any obligation to update publicly any forward-looking statements, whether as a result of the receipt of new information, future events, or otherwise.
CONTACT: Mala Ray, Encision Inc., 303-444-2600, mray@encision.com
Encision Inc.
Unaudited Condensed Statements of Operations
(in thousands, except per share information)
Three Months Ended Years Ended
------------------ -----------
March 31, 2018 March 31, 2017 March 31, 2018 March 31, 2017
-------------- -------------- -------------- --------------
Net revenue $2,038 $2,212 $8,754 $8,870
Cost of revenue 867 1,070 3,747 4,464
----- -----
Gross profit 1,171 1,142 5,007 4,406
----- ----- ----- -----
Operating expenses:
Sales and marketing 567 629 2,312 2,511
General and administrative 399 367 1,457 1,456
Research and development 207 246 842 1,127
--- --- --- -----
Total operating expenses 1,173 1,242 4,611 5,094
----- ----- ----- -----
Operating income (loss) (2) (100) 396 (688)
Interest expense and other
expense, net
(16) (15) (60) (41)
--- --- --- ---
Income (loss) before
provision for income taxes (18) (115) 336 (729)
Provision for income taxes -- -- -- --
--- --- --- ---
Net income (loss) $(18) $(115) $336 $(729)
==== ===== ==== =====
Net income (loss) per share-
basic $0.00 $(0.01) $0.03 $(0.07)
Net income (loss) per share-
diluted $0.00 $(0.01) $0.03 $(0.07)
Weighted average number of
shares-basic
10,683 10,683 10,683 10,677
Weighted average number of
shares-diluted
10,683 10,683 10,707 10,677
Encision Inc.
Unaudited Condensed Balance Sheets
(in thousands)
March 31, 2018 March 31, 2017
-------------- --------------
ASSETS
Cash and cash equivalents $115 $45
Restricted cash 25 50
Accounts receivable, net 962 1,042
Inventories, net 1,437 1,129
Prepaid expenses 75 62
--- ---
Total current assets 2,614 2,328
----- -----
Equipment, net 349 468
Patents, net 270 254
Other assets 19 17
--- ---
Total assets $3,252 $3,067
------ ------
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $466 $403
Accrued compensation 257 268
Other accrued liabilities 285 248
Line of credit -- 275
Deferred rent 30 30
Total current liabilities 1,038 1,224
Deferred rent 10 41
Total liabilities 1,048 1,265
Common stock and additional paid-in
capital 23,818 23,752
Accumulated (deficit) (21,614) (21,950)
------- -------
Total shareholders' equity 2,204 1,802
----- -----
Total liabilities and shareholders'
equity $3,252 $3,067
------ ------
Encision Inc.
Unaudited Condensed Statements of Cash Flows
(in thousands)
Years Ended
-----------
March 31, 2018 March
31,
2017
Operating
activities:
Net income (loss) $336 $(729)
Adjustments to
reconcile net
income (loss) to
cash generated by
operating
activities:
Depreciation and
amortization 203 225
Share-based
compensation
expense 66 70
(Recovery from)
provision for
doubtful
accounts, net (13) 24
(Recovery from)
inventory
obsolescence, net (29) (360)
Changes in
operating assets
and liabilities:
Accounts
receivable 92 (227)
Inventories (280) 962
Prepaid expenses
and other assets (15) 29
Accounts payable 64 47
Accrued
compensation and
other accrued
liabilities (4) (18)
--- ---
Net cash generated
by operating
activities 420 23
--- ---
Investing
activities:
Acquisition of
property and
equipment (57) (105)
Patent costs (43) (28)
--- ---
Net cash (used in)
investing
activities (100) (133)
---- ----
Financing
activities:
Paydown of credit
facility, net
change (275) (113)
Change in
restricted cash 25 (25)
Net cash (used in)
financing
activities (250) (138)
---- ----
Net increase
(decrease) in
cash and cash
equivalents 70 (248)
Cash and cash
equivalents,
beginning of
period 45 293
--- ---
Cash and cash
equivalents, end
of period $115 $45
==== ===
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SOURCE Encision Inc.
