Authentidate Holding Corp. (ADAT) filed Quarterly Report for the period ended 2010-09-30.
Authentidate Holding Corp. has a market cap of $24.2 million; its shares were traded at around $0.63 with and P/S ratio of 3.6. ADAT is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:Product development expenses were $410,000 for the quarter ended September 30, 2010, compared to $507,000 for the prior year period. Product development expenses fluctuate period to period based on the amounts capitalized. Total spending for the quarter, including capitalized amounts, was $411,000 compared to $546,000 for the prior year reflecting our cost management activities.
Net loss for the quarter ended September 30, 2010 was $1,597,000, or $0.04 per share, compared to $2,113,000, or $0.06 per share, for the prior year period. The decrease in net loss for the period reflects higher U.S. revenues, lower expenses from our cost management activities and the gain on the sale of certain non-core assets discussed above, which offset the impact of lower revenues from our German operations.
Our operations and product development activities have required substantial capital investment to date. Our primary sources of funds have been the issuance of equity and the incurrence of third party debt. In February 2004, we sold 5,360,370 common shares in private placements pursuant to Section 4(2) of the Securities Act of 1933 and Rule 506, promulgated there under and received net proceeds of approximately $69,100,000 after payment of offering expenses and broker commissions. The proceeds received from this financing have been used to provide funding for our operations and product development activities. In addition, we completed a $3,400,000 registered direct offering of shares of common stock and warrants in December 2009 and received net proceeds of approximately $3,500,000 from this financing and the related warrant exercises. As described in greater detail in Notes 6 and 18, respectively, of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q, in July 2010 we completed the sale of certain non-core assets and received net proceeds of approximately $2,350,000 and on October 13, 2010, the company completed the sale of $5,000,000 of its securities to institutional and accredited investors in a private placement transaction under Section 4(2) of the Securities Act of 1993, as amended, and Rule 506 of Regulation D, promulgated thereunder and received net proceeds of approximately $4,500,000 from this transaction. We are using the proceeds from these transactions for working capital and general corporate purposes, including supporting the rollout of our ExpressMD telehealth products and services.
Expenditures for property and equipment totaled approximately $8,000, expenditures for software licenses totaled approximately $4,000 and capitalized software development expenditures totaled approximately $1,000 for the quarter ended September 30, 2010. We have developed and intend to continue to develop new applications to grow our business and address new markets.
At September 30, 2010, cash, cash equivalents and marketable securities amounted to approximately $1,686,000 and total assets at that date were $18,591,000. Since June 30, 2010 cash, cash equivalents and marketable securities increased approximately $174,000 from the sale of non-core assets offset by cash used principally to fund operating losses, product development activities, joint venture investments, changes in working capital and capital expenditures during the quarter ended September 30, 2010. Cash used for the period includes investments in joint venture inventory and operations of approximately $335,000 and $153,000, respectively, and the prepayment of certain insurance premiums and maintenance contracts. We expect to continue to use cash to fund operating losses, product development activities, joint venture investments and capital expenditures for the foreseeable future.
the first year was $324,000 increasing to $512,000 in year 2 and increasing at regular intervals until year 10 when the annual rent was approximately $561,000. Effective February 1, 2010, we amended our lease to reduce the annual rent to approximately $512,000 for the remaining lease term and extended the lease term for one year through January 2017. The lease also provides us with a one-time option to renew the lease for a term of five years at the then-current market rate. As part of the lease agreement, we had posted a letter of credit securing our lease payments which was reduced to approximately $256,000.
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