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CARDICA, INC. (CRDC) filed Quarterly Report for the period ended 2011-09-30.
Cardica Inc. has a market cap of $56.6 million; its shares were traded at around $2.1 with and P/S ratio of 4.3.
This is the annual revenues and earnings per share of CRDC over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of CRDC.
Highlight of Business Operations:
We manufacture our C-Port and PAS-Port systems with parts we manufacture and components supplied by vendors, which we then assemble, test and package. For the three months ended September 30 2011, we generated net revenue of $0.9 million, including $84,000 of license and development revenue, and incurred a net loss of $3.0 million.In addition, on the same date, we entered into a Stock Purchase Agreement with Intuitive Surgical pursuant to which Intuitive Surgical paid $3.0 million to purchase from us an aggregate of 1,249,541 newly-issued shares of the Company s common stock, or the Stock Issuance. The net proceeds recorded to stockholders equity based upon the fair value of our common stock on August 16, 2010 were approximately $2.0 million after offering expenses. From the premium paid of $1.0 million and the upfront license fee payment of $9.0 million, $84,000 and $9.0 million had been recorded as license and development revenue for the three months ended September 30, 2011 and September 30, 2010, respectively, and $628,000 had been recorded as deferred revenue as of September 30, 2011. There were no underwriters or placement agents involved with the Stock Issuance, and no underwriting discounts or commissions or similar fees were payable in connection with the Stock Issuance.
In June 2007, we entered into, and in September 2007 and in June 2009 amended, a license, development and commercialization agreement with Cook Incorporated, or Cook, to develop and commercialize a specialized device, referred to as the PFO device, designed to close holes in the heart from genetic heart defects known as patent foramen ovales, or PFOs. Under the agreement, Cook funded certain development activities and we and Cook jointly developed the device. Our significant deliverables under the arrangement were the license rights and the associated development activities. These deliverables were determined to represent one unit of accounting as there was no stand-alone value to the license rights. If developed, Cook would receive an exclusive, worldwide, royalty-bearing license, with the right to grant sublicenses, to make, have made, use, sell, offer for sale and import the PFO device. Under this agreement, we received payments of $1.0 million and $1.7 million in fiscal years ended June 30, 2009 and 2008, respectively. We received no payments in fiscal 2011 or 2010 and did not record any license and development revenue under the agreement for the three months ended September 30, 2011 or 2010. Amounts paid but not yet earned on the project are recorded as deferred revenue until such time as the related development expenses for certain project activities are incurred. A total of $403,000 under this agreement had been recorded as deferred revenue as of September 30, 2011 and June 30, 2011. We are entitled to receive from Cook up to a total of an additional $275,000 in future payments if development milestones under the agreement are achieved. We are also entitled to receive a royalty based on Cook's annual worldwide sales of the PFO device, if any. On January 6, 2010, we and Cook mutually agreed to suspend work on the PFO project and, accordingly, we do not anticipate receiving any additional payments or recording any additional revenue related to this agreement in the foreseeable future.
Net Revenue. Total net revenue decreased by $9.2 million, or 91%, to $0.9 million for the three months ended September 30, 2011 compared to $10.0 million for the same period in 2010. Product sales decreased by $228,000, or 23%, to $0.8 million for the three months ended September 30, 2011 compared to $1.0 million for the same period in 2010. The decrease of $228,000 in product sales for the three months ended September 30, 2011 was primarily attributable to both lower PAS-Port and C-Port systems sales in the United States. The decrease in license and development revenue of $8.9 million relates to the Intuitive Surgical License Agreement that we entered into in August 2010 under which we recognized $9.0 million upon entering into the agreement and transferring certain license rights in the three months ended September 30, 2010.
Cost of Product Sales. Cost of product sales consists primarily of material, labor and overhead costs. Cost of product sales decreased by $117,000, or 12%, to $0.8 million for the three months ended September 30, 2011 compared to $0.9 million for the same period in 2010. The decrease in cost of product sales resulted primarily from decreased unit sales. We recorded a lower of cost or market inventory write-down of $66,000 in the three months ended September 30, 2011 compared to $111,000 for the same period in 2010 primarily on our PAS-Port system inventory due to lower product cost of units manufactured in 2011. We released $12,000 of excess and obsolete inventory reserves as a result of units sold in the three months ended September 30, 2011.
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