Addison, TX / ACCESSWIRE / August 14, 2014 / Wound Management Technologies, Inc. (OTCQB: WNDM), an emerging commercial stage company with its primary product, a patented-protected and FDA-cleared collagen product, CellerateRX(r), today announced its financial and operating results for the three month period ended on June 30, 2014.
Recent Operating Highlights
- Second quarter revenues increased 31% to $544,350, from the second quarter of 2013
- YTD 2014 revenues increased 55% to $1,226,644, from the first half of 2013
- Established 65 new accounts for CellerateRX(r) wound care and surgical products in the 2nd quarter
"The strong financial results for the second quarter, including a 31% increase in revenue, are a positive sign that we are successfully executing on our strategic growth initiatives. We attribute much of this success to the expanded recognition and adoption of CellerateRX(r) products among physicians and in new healthcare settings," said Robert Lutz, Jr., Chairman and CEO of Wound Management Technologies. "Our network of distributors and sales representatives was able to bring on 65 new accounts this quarter by highlighting the proven clinical efficacy and cost effectiveness of the CellerateRX(r) products in the wound care and surgical market."
"The emergence of Resorbable Orthopedic Products (ROP) division is started to take hold in the second quarter as we are now generating royalty income from BioStructures for the Signafuse product, which received FDA-clearance earlier this year. We are still anticipating FDA-clearance and a CE Mark for our resorbable hemostat product in late 2014 or early 2015 and have already started the negotiation process for US and international distribution partners," continued Mr. Lutz, Jr.
"In order to maintain our growth and manage a larger customer base with new and existing products, we have had to build out our team and make investments into our sales and marketing. We are approximately one year into our relationship with WellDyne, who has worked with us to launch new marketing programs and to introduce CellerateRX(r) into new market segments. We expect these programs to start contributing in the second half of 2014 as a major driver of our growth. We have also made a number of appointments to the management team earlier in the year, including the appointment of a new CFO, Chief Medical Officer for the Wound Care Innovations subsidiary and a new Medical Director. Over the past several months these new members to the Company have quickly made themselves valuable parts of the team and we are excited to have them aboard. With a sold infrastructure in place, we look forward to capitalizing on these market opportunities," concluded Mr. Lutz, Jr.
Financial Results for the Three Months Ended June 30, 2014
The Company increased revenue by 31% for the three months ended June 30, 2014, of $544,350, as compared to revenues of $415,693 for the three months ended June 30, 2013. The increase in revenues is the result of the successful implementation of the Company's strategic plan to introduce products into hospitals, operating rooms and wound centers and the successful launch of the CellerateRX Surgical powder product.
Cost of goods sold for the three months ended June 30, 2014, was $269,446, as compared to costs of goods sold of $229,695 for the three months ended June 30, 2013, or a 17% increase. The fluctuation in cost of goods sold is due in part to the Company's decision to present the cost of external commissions as general and administrative expenses beginning in 2014, reducing the overall cost of goods sold for the year. The Company did, however, record roughly $90,000 in damaged and expired inventory in the second quarter causing the cost of goods sold for the period to increase.
General and administrative expenses ("G&A") for the three months ended June 30, 2014, were $1,012,633, as compared to G&A expenses of $428,416 for the three months ended June 30, 2013, or a 136% increase in G&A expenses. G&A expenses increased in 2014 due to increased payroll and consulting expenses related to the expansion of the Company's staff as well as to increased legal fees as the Company pursues various strategic relationships and product development opportunities.
Interest expense was $42,516 for the three months ended June 30, 2014, as compared to $59,883 for the three months ended June 30, 2013, or a decrease of 29%.
Debt related expense was $0 for the three months ended June 30, 2014, as compared to $210,905 for the three months ended June 30, 2013. In 2013 the Company incurred numerous fees related to debt extensions. No such fees were incurred in 2014.
The Company recorded a net loss for the three months ended June 30, 2014 of $775,924, as compared to a net loss of $32,336 for the three months ended June 30, 2013. Although the Company increased sales revenue significantly in 2014, net loss increased for the period due to the significant increase in general and administrative expenses as the Company invests in staffing and programs to increase future sales and develop additional product lines.
As of June 30, 2014, the Company had total current assets of $1,915,177, including cash of $1,134,592 and inventories of $500,440. As of December 31, 2013, the Company had current assets of $654,459, including cash of $44,553 and inventories of $307,502.
Financial Results for the Six Months Ended June 30, 2014
The Company increased revenue by 55% for the six months ended June 30, 2014, of $1,226,644, as compared to revenues of $790,417 for the six months ended June 30, 2013. The increase in revenues is the result of the successful implementation of the Company's strategic plan to introduce products into hospitals, operating rooms and wound centers and the successful launch of the CellerateRX Surgical powder product.
Cost of goods sold for the six months ended June 30, 2014, was $438,169, as compared to costs of goods sold of $444,785 for the six months ended June 30, 2013, or a 1% decrease. The six month period for 2014 included the cost of external commissions as general and administrative expenses beginning in 2014, reducing the overall cost of goods sold for the year. The Company did, however, record roughly $90,000 in damaged and expired inventory in the second quarter causing the cost of goods sold for the period to increase.
G&A expenses for the six months ended June 30, 2014, were $1,925,867, as compared to G&A expenses of $974,727 for the six months ended June 30, 2013, or a 98% increase in G&A expenses. G&A expenses increased in 2014 due to increased payroll and consulting expenses related to the expansion of the Company's staff as well as to increased legal fees as the Company pursues various strategic relationships and product development opportunities.
Interest expense was $205,659 for the six months ended June 30, 2014, as compared to $170,008 for the six months ended June 30, 2013, or an increase of 21%. Interest expense increased in 2014 as the result of the amortization of debt discounts.
Debt related expense was $0 for the six months ended June 30, 2014, as compared to $62,145 for the six months ended June 30, 2013. In 2013 the Company incurred numerous fees related to debt extensions. No such fees were incurred in 2014.
The Company recorded a net loss for the six months ended June 30, 2014 of $1,321,887, as compared to a net loss of $974,601 for the six months ended June 30, 2013. Although the Company increased sales revenue significantly in 2014, net loss increased for the period due to the significant increase in general and administrative expenses as the Company invests in staffing and programs to increase future sales and develop additional product lines.
About Wound Management Technologies
Wound Management Technologies, Inc. is an emerging commercial stage company with its primary products in the $5B worldwide advanced wound care market. Wound Management's primary focus is the distribution of its Wound Care Innovations subsidiary's unique, patented collagen product line, CellerateRX(r) which is FDA-cleared for all wound types except 3rd degree burns. The wound care product line is reimbursable under Medicare Part B and the surgical products are reimbursable as part of procedural billing. Wound Management has other advanced biotech products in development including a patented resorbable bone hemostat line that is in late stages of development. For more information visit www.wmgtech.com.
Information about Forward-Looking Statements
The statements in the press release that relate to the Company's expectations with regard to the future impact on the Company's results from new products in development and any other statements not constituting historical facts are "forward-looking statements," within the meaning of and subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. Since this information may contain statements that involve risk and uncertainties and are subject to change at any time, the Company's actual results may differ materially from expected results. This document may contain forward-looking statements concerning the Company's operations, current and future performance and financial condition. These items involve risks, contingencies and uncertainties such as product demand, market and customer acceptance, the effect of economic conditions, competition, pricing, the ability to consummate and integrate acquisitions, and other risks, contingencies and uncertainties detailed in the Company's SEC filings, which could cause the Company's actual operating results, performance or business plans or prospects to differ materially from those expressed in, or implied by these statements. The Company undertakes no obligation to revise any of these statements to reflect the future circumstances or the occurrence of unanticipated events.
Investor Contacts:
KCSA Strategic Communications
Todd Fromer / Garth Russell
+ 212-682-6300
[email protected] / [email protected]
SOURCE: Wound Management Technologies, Inc.