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Competitive Technologies Inc Reports Operating Results (10-Q/A)
Posted by: gurufocus (IP Logged)
Date: November 17, 2011 05:52PM

Competitive Technologies Inc (CTT) filed Amended Quarterly Report for the period ended 2011-09-30. Competitive Technologies Inc has a market cap of $15.54 million; its shares were traded at around $0 .



Highlight of Business Operations:

We incurred a net loss of $538,000 or $0.04 per basic and diluted share for the three months ended September 30, 2011, compared to a net loss of $1,094,000 or $0.08 per basic and diluted share for the three months ended October 31, 2010. As explained in detail below, the net loss reflects an increase of $1,090,000 in gross revenue, an increase of $603,000 in gross profit from product sales and an increase in other expenses of $49,000.

We incurred a net loss of $1,843,000 or $0.13 per basic and diluted share for the nine months ended September 30, 2011, compared to a net loss of $2,302,000 or $0.19 per basic and diluted share for the nine months ended October 31, 2010. As explained in detail below, the net loss reflects an increase of $1,663,000 in gross revenue, an increase of $704,000 in gross profit from product sales and an increase in other expenses of $287,000.

Selling expenses were $416,000 in the nine months ended September 30, 2011, compared to $287,000 in the nine months ended October 31, 2010. The increase of $129,000 was primarily due to an overall increase of $101,000 in commission expenses related to sales of Calmare® devices, an increase of $43,000 in domestic patent legal expenses related to the joint venture with XION Corporation to develop the melanocortin technologies, an increase of $11,000 in foreign patent legal expenses related to the "Scrambler Therapy" technology, a liability associated with the sale of video compression patents of $33,000, and an additional $6,000 in expenses associated with other technologies. These increases in selling expenses were off set by a $35,000 reduction in translation, legal and other services directly related to "Scrambler Therapy" and the Calmare® devices, and $30,000 foreign patent expense incurred in the nine months ended October 31, 2010, which did not recur in the nine months ended September 30, 2011.

Personnel and consulting expenses were $1,204,000 in the nine months ended September 30, 2011, as compared to $1,498,000 in the nine months ended October 31, 2010, a decrease of $294,000, or 20%. Personnel and related benefit expenses were lower in the nine months ended September 30, 2011, due to the reduction in the number of employees from 10 to 7 and the associated reduction in salaries and benefits ($478,000), as well as a reduction in the employee stock option compensation expense ($1,000). In the nine months ended October 31, 2010 we incurred recruiting expenses ($60,000) related to the hiring of a US sales manager and sales representatives, and consulting fees for the Medical Advisory Board ($35,000) neither of which recurred in the nine months ended September 30, 2011. These decreases were offset by an increase ($15,000) in employee incentive payments, and increased consulting fees ($265,000), primarily due to work related to U.S. and Federal government sales of our Calmare® device, the management services of our current CEO, and the work of the contracted Managing Director for International Business Development.

General and administrative expenses increased to $2,114,000 in the nine months ended September 30, 2011, compared to $1,703,000 in the nine months ended October 31, 2010. The increase of $411,000 is primarily due to increases in legal fees ($583,000) associated with the legal activity relating to the former CEO challenging his termination for cause; increases in other legal fees ($89,000); increased Board of Directors' fees and expenses associated with the increased involvement of the non-employee Chairman in CTTC operations as well as increased Board involvement with various legal actions ($70,000); increases in audit and tax expenses ($32,000); increase in supplies associated with the opening of the new office in North Carolina ($22,000), an increase in contribution expenses associated with the donation of two Calmare® devices to a hospital in Italy ($7,000), increased insurance costs ($6,000), and increased costs for administering employee benefits ($6,000). Increased sales of Calmare® devices have led to increases in, postage and delivery ($20,000), banking fees ($4,000), and in travel expenses ($4,000) due to increased travel associated with training customers as well as increases in dues and subscriptions ($3,000).

Read the The complete Report



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