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THERMOGENESIS Corp. Reports Operating Results (10-Q)

February 11, 2011 | About:
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10qk

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THERMOGENESIS Corp. (KOOL) filed Quarterly Report for the period ended 2010-12-31.

Thermogenesis Corp. has a market cap of $46.7 million; its shares were traded at around $3.49 with and P/S ratio of 2.1. Thermogenesis Corp. had an annual average earning growth of 21.9% over the past 10 years.Hedge Fund Gurus that owns KOOL: Jim Simons of Renaissance Technologies LLC.

Highlight of Business Operations:

Revenues for the three months ended December 31, 2010 were $5,860,000 compared to $5,955,000 for the three months ended December 31, 2009, a decrease of $95,000 or 2%. The decrease is primarily due to a decrease in AXP and BioArchive disposables as the economic environment has impacted U.S. and European cord blood collections, These decreases were offset by an increase in Res-Q disposables as our initial distributor, Celling Technologies, LLC, doubled their volume from the second quarter of fiscal 2010. Also, revenues in the second quarter decreased $270,000 as a result of an extension of credit terms on a fiscal 2011 first quarter transaction. Any future revenue recognized on this transaction will occur as cash is collected.

Research and development expenses were $774,000 for the three months ended December 31, 2010, compared to $1,400,000 for the corresponding fiscal 2010 period, a decrease of $626,000 or 45%. A majority of the decrease was due to costs incurred in the quarter ending December 31, 2009 that did not recur in the current quarter. Namely, $240,000 for the termination of the consulting agreement with the Companys former Chief Technology Architect, $60,000 for quality system consultants and $90,000 related to the hiring of a new Vice President, Chief Quality and Regulatory Affairs Officer. Also, there was a $200,000 decrease in salary and benefits due to lower headcounts. Although we do not intend to increase research and development spending significantly in the near future, as development opportunities arise, we may increase spending if warranted.

Revenues for the six months ended December 31, 2010 were $12,857,000 compared to $11,148,000 for the six months ended December 31, 2009, an increase of $1,709,000 or 15%. The increase is primarily due to an increase in AXP and Res-Q disposables. Res-Q disposables increased as our initial distributor, Spine Smith, doubled their volume from the corresponding period of the prior year. The increase in AXP disposables is due to the inventory build by GEHC in the first quarter of fiscal 2011 of approximately $1,000,000.

Selling, general and administrative expenses were $4,273,000 for the six months ended December 31, 2010, compared to $4,253,000 for the comparable fiscal 2010 period, an increase of $20,000. The slight increase is primarily due to an increase in stock compensation expense of $328,000 primarily attributable to options granted to the independent members of our board of directors in the quarter ended December 31, 2010 and the amortization of the initial grant of restricted stock to Nanshan upon signing the distributor agreement. This increase is offset by a decrease in recruiting costs of $250,000 as we were recruiting for two board members and the Vice Presidents of Sales and Quality/Regulatory Affairs during the six months ended December 31, 2009.

Research and development expenses were $1,499,000 for the six months ended December 31, 2010, compared to $2,994,000 for the corresponding fiscal 2010 period, a decrease of $1,495,000. The decrease is primarily due to $340,000 of expense in the six months ended December 31, 2009 for the consulting fees and termination of the consulting agreement with the Companys former Chief Technology Architect. Also, there was a decrease in salary and benefits of $478,000 due to lower headcount and the costs incurred in the second quarter of fiscal 2010 associated with the hiring of a new Vice President, Chief Quality and Regulatory Affairs Officer and a $270,000 decrease in costs due to completion of development of the Res-Q and other projects during fiscal 2010.

At December 31, 2010, we had cash and cash equivalents of $10,201,000 and working capital of $16,888,000. This compares to cash and cash equivalents of $10,731,000 and working capital of $16,587,000 at June 30, 2010. The cash was used to fund operations and other strategic initiatives. In addition to product revenues, we have primarily financed operations through private and public placement of equity securities and have raised approximately $108,000,000, net of expenses, through common and preferred stock financings and option and warrant exercises.

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