Escalon Medical Corp. (ESMC, Financial) filed Annual Report for the period ended 2010-06-30.
Escalon Medical Corp. has a market cap of $11.1 million; its shares were traded at around $1.501 with and P/S ratio of 0.4. ESMC is in the portfolios of Jim Simons of Renaissance Technologies LLC.
The Company has incurred recurring operating losses and negative cash flows from operating activities related to its Drew division which includes the recently acquired Biocode. The Company is experiencing lower than expected sales from Biocode related to reduced instrument sales due to uncertainty surrounding pending regulatory changes under French law. The Company does not know when this uncertainty will be resolved nor what impact the new law if enacted will have on Biocodes revenues in the future. For the year ended June 30, 2010, Biocode generated a net loss of $636,000. Also, since the acquisition of Drew the Company loaned approximately $29 million to Drew, and during fiscal year ended June 30, 2010 invested additional capital in Biocode of approximately $1,200,000. The funds were primarily used to procure components to build up inventory to support the manufacturing process, to pay off accounts payable and debt of Drew, and to expand the sales and marketing and research and development efforts, to fund new product development and underwrite operating losses since its acquisition. The Company cannot rule out that further working capital will be required by Drew and Biocode. If the Company does not realize the expected benefits or synergies of such transactions, the Companys consolidated financial position, results of operations and stock price could be negatively impacted.
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Escalon Medical Corp. has a market cap of $11.1 million; its shares were traded at around $1.501 with and P/S ratio of 0.4. ESMC is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
The Company conducts development of medical devices for the diagnosis and monitoring of medical disorders in the areas of diabetes, cardiovascular diseases and hematology at the Companys Dallas, Texas, Miami, Florida and Rennes, France facilities. The Company conducts medical device and vascular access product development at its New Berlin, Wisconsin facility. The development of ultrasound ophthalmic equipment is performed at the Companys Lake Success, New York facility on Long Island. Company-sponsored research and development expenditures from continuing operations for the fiscal years ended June 30, 2010, 2009 and 2008 were approximately $1,893,000, $3,256,000, and $3,798,000, respectively.The Company has incurred recurring operating losses and negative cash flows from operating activities related to its Drew division which includes the recently acquired Biocode. The Company is experiencing lower than expected sales from Biocode related to reduced instrument sales due to uncertainty surrounding pending regulatory changes under French law. The Company does not know when this uncertainty will be resolved nor what impact the new law if enacted will have on Biocodes revenues in the future. For the year ended June 30, 2010, Biocode generated a net loss of $636,000. Also, since the acquisition of Drew the Company loaned approximately $29 million to Drew, and during fiscal year ended June 30, 2010 invested additional capital in Biocode of approximately $1,200,000. The funds were primarily used to procure components to build up inventory to support the manufacturing process, to pay off accounts payable and debt of Drew, and to expand the sales and marketing and research and development efforts, to fund new product development and underwrite operating losses since its acquisition. The Company cannot rule out that further working capital will be required by Drew and Biocode. If the Company does not realize the expected benefits or synergies of such transactions, the Companys consolidated financial position, results of operations and stock price could be negatively impacted.
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