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Uroplasty Inc Reports Operating Results (10-Q)

October 27, 2010 | About:
10qk

10qk

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Uroplasty Inc (UPI) filed Quarterly Report for the period ended 2010-09-30.

Uroplasty Inc has a market cap of $93.4 million; its shares were traded at around $4.37 with and P/S ratio of 7.9. UPI is in the portfolios of Chuck Royce of Royce& Associates.

Highlight of Business Operations:

Net Sales: During the three months ended September 30, 2010, net sales of $3.2 million represented a $258,000, or a 9% increase, over net sales of $3.0 million for the three months ended September 30, 2009. Excluding the translation impact of fluctuations in foreign currency exchange rates, sales increased by approximately 13%. During the six months ended September 30, 2010, net sales of $6.3 million represented a $468,000, or an 8% increase, over net sales of $5.8 million for the three months ended September 30, 2009. Excluding the translation impact of fluctuations in foreign currency exchange rates, sales increased by approximately 12%.

Sales to customers in the U.S. of $1.8 million during the three months ended September 30, 2010, represented a $340,000, or a 23% increase, over net sales of $1.5 million for the three months ended September 30, 2009. During the six months ended September 30, 2010 sales to customer in the U.S. totaled $3.5 million, representing a 17% increase, over net sales of $3.0 million for the six months ended September 30, 2009.

General and Administrative Expenses (G&A): G&A expenses of $897,000 during the three months ended September 30, 2010, increased $184,000 from $713,000 during the same period in 2009. G&A expenses increased primarily because of an $80,000 increase in compensation and bonus costs, and a $106,000 increase in consulting costs. G&A expenses of $1.7 million during the six months ended September 30, 2010, increased $186,000 from $1.6 million during the same period in 2009. Included in the six-month period ended September 30, 2010 is a $68,000 non-cash, share-based compensation expense, compared with a charge of $144,000 in the six-month period ended September 30, 2009. Excluding share-based compensation charges, G&A expenses increased by $262,000. G&A expenses increased primarily because of a $120,000 increase in compensation and bonus costs, a $106,000 increase in consulting costs, and a $36,000 increase in legal fees.

Research and Development Expenses (R&D): R&D expenses increased to $472,000 during the three months ended September 30, 2010 from $436,000 during the same period in 2009. The increase is attributed primarily to a $17,000 increase in compensation and bonus costs, and a $14,000 increase in costs related to regulatory activities. R&D expenses decreased to $873,000 during the six months ended September 30, 2010 from $964,000 during the same period in 2009. Included in the six-month period ended September 30, 2010 is a $13,000 non-cash, share-based compensation expense, compared with a charge of $32,000 in the six-month period ended September 30, 2009. Excluding share-based compensation charges, R&D expenses decreased by $72,000. The decrease is attributed primarily to a $133,000 decrease in spending for clinical studies, offset partially by an increase of $24,000 in compensation and bonus costs, and an increase of $31,000 in regulatory costs. We expect to spend approximately $400,000 in fiscal 2011 for ongoing clinical studies to support marketing efforts and to meet regulatory requirements.

Amortization of Intangibles: Amortization of intangibles was $211,000 and $212,000 for the three months ended September 30, 2010 and 2009, respectively, and was $421,000 and $423,000 for the six months ended September 30, 2010 and 2009, respectively. In April 2007, we acquired from CystoMedix, Inc., certain intellectual property assets related to the Urgent PC system for $4.7 million, which we are amortizing over six years.

For the six months ended September 30, 2010 we generated proceeds from financing activities of approximately $17.2 million, consisting of approximately $14.9 million net proceeds from the offering of our common stock and approximately $2.3 million from the exercise of warrants and options. In July 2010, in a public offering of our common stock, we issued 4.6 million shares (inclusive of the over-allotment exercised by the underwrites) at $3.50 per share, for gross proceeds of $16.1 million, and net proceeds, after fees and expenses, of approximately $14.9 million. We anticipate using the proceeds to expand our U.S. sales and marketing organization to support our Urgent PC business and for clinical studies, working capital and general corporate purposes. In anticipation of increased interest in our Urgent PC after the new CPT code is effective, we have already started to expand our U.S. field sales and support organization.

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