AtriCure Inc. (ATRC, Financial) filed Quarterly Report for the period ended 2009-03-31.
AtriCure Inc. is a medical device company focused on developing manufacturing and selling innovative surgical devices to create precise lesions or scars in soft tissues. Medical journals have described the adoption by leading cardiothoracic surgeons of the AtriCure Inc. bipolar ablation system as a standard treatment alternative during open-heart surgical procedures to safely rapidly and reliably create lesions in cardiac or heart tissue to block the abnormal electrical impulses that cause atrial fibrillation a quivering of the upper chambers of the heart. AtriCure Inc. has a market cap of $43.8 million; its shares were traded at around $3.05 with and P/S ratio of 0.9.
Other (expense) income. Other (expense) income consists of foreign currency transaction (loss) gain, grant income and non-employee option (expense) income related to the fair market value change for fully vested options outstanding for consultants, which are accounted for as free standing derivatives. Foreign currency transaction loss was $48,387 for the three months ended March 31, 2009 compared to foreign currency transaction gain of $33,074 for the same period in 2008. Non-employee option income was $24,829 for the three months ended March 31, 2009, compared to $61,878 for the three months ended March 31, 2008. Grant income was $74,187 for the three months ended March 31, 2008, and no income was recorded during the three months ended March 31, 2009.
As of March 31, 2009, we had cash and cash equivalents of $8.6 million and short-term and long-term debt of $0.1 million, resulting in a net cash position of $8.5 million. We had working capital of $17.9 million and an accumulated deficit of $85.4 million.
Cash flows used in operating activities. Net cash used in operating activities was $2.4 million for the three months ended March 31, 2009 and $3.8 million for the three months ended March 31, 2008. Net cash used in operating activities for the three months ended March 31, 2009 was primarily attributable to the net loss of $8.0 million, an increase in accounts receivable of $1.1 million and a decrease in accounts payable and accrued liabilities of $2.4 million. The increase in accounts receivable was primarily due to an increase in revenues. The decrease in accounts payable and accrued liabilities was primarily due to the payment of inventory purchases made during 2008 and the payment of severance related expenses incurred as a result of the reduction in force that occurred during the fourth quarter of 2008. These uses of cash were partially offset by non-cash charges related to share-based compensation of $1.1 million and a goodwill impairment charge of $6.8 million. Net cash used in operating activities was $3.8 million for the three months ended March 31, 2008. Net cash used in operating activities for the three months ended March 31, 2008 was primarily attributable to a net loss of $3.6 million and increases in accounts receivable and inventory of $1.3 million and $1.0 million, respectively. The increase in accounts receivable was primarily due to an increase in and the timing of revenues. The increase in inventories was primarily related to anticipated growth and new product introductions. The increases were partially offset by a net increase in accounts payable and accrued liabilities of $0.8 million, due primarily to an increase in accounts payable associated with the purchase of inventories and an increase in operating expenses.
Cash flows provided by investing activities. Net cash provided by investing activities was $5.6 million for the three months ended March 31, 2009 and $4.3 million for the three months ended March 31, 2008. In the first three months of 2009, net cash provided by investing activities included $6.0 million related to the release of the restriction on our cash and cash equivalents, due to the re-payment of the borrowings under the National City credit facility. The three month period ended March 31, 2008 included maturities of investments of $5.1 million, For each of these periods, net cash provided by investing activities reflected purchases of property and equipment of $0.4 million and $0.8 million, respectively.
Cash flows used in financing activities. Net cash used in financing activities was $6.1 million for the three months ended March 31, 2009. For the three months ended March 31, 2009, cash flows used in financing activities included payments made on our debt and capital lease obligations of $6.0 million, including a $6.0 million repayment in full of our National City credit facility. For the three months ended March 31, 2008, cash flows used in financing activities reflected a $0.4 million repayment of a note associated with our acquisition of a product line and payments made on our debt and capital lease obligations of $0.1 million. These uses were partially offset by proceeds from the exercise of stock options of $0.1 million.
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AtriCure Inc. is a medical device company focused on developing manufacturing and selling innovative surgical devices to create precise lesions or scars in soft tissues. Medical journals have described the adoption by leading cardiothoracic surgeons of the AtriCure Inc. bipolar ablation system as a standard treatment alternative during open-heart surgical procedures to safely rapidly and reliably create lesions in cardiac or heart tissue to block the abnormal electrical impulses that cause atrial fibrillation a quivering of the upper chambers of the heart. AtriCure Inc. has a market cap of $43.8 million; its shares were traded at around $3.05 with and P/S ratio of 0.9.
Highlight of Business Operations:
We commenced a full commercial release of our primary product line, the Isolator system, for use during open heart procedures in 2003, and have brought new products to market over time. During 2005, we commercialized the Isolator system for use during minimally invasive sole-therapy procedures. Our revenues have grown from $9.8 million in 2003 to $55.3 million in 2008. In August 2005 we raised net proceeds of $43.2 million through an initial public offering. Since then, we have invested heavily in expanding our product development organization and activities and building our sales and marketing organizations and activities. Our operating expenses have increased from $10.5 million in 2003 to $53.0 million in 2008.Other (expense) income. Other (expense) income consists of foreign currency transaction (loss) gain, grant income and non-employee option (expense) income related to the fair market value change for fully vested options outstanding for consultants, which are accounted for as free standing derivatives. Foreign currency transaction loss was $48,387 for the three months ended March 31, 2009 compared to foreign currency transaction gain of $33,074 for the same period in 2008. Non-employee option income was $24,829 for the three months ended March 31, 2009, compared to $61,878 for the three months ended March 31, 2008. Grant income was $74,187 for the three months ended March 31, 2008, and no income was recorded during the three months ended March 31, 2009.
As of March 31, 2009, we had cash and cash equivalents of $8.6 million and short-term and long-term debt of $0.1 million, resulting in a net cash position of $8.5 million. We had working capital of $17.9 million and an accumulated deficit of $85.4 million.
Cash flows used in operating activities. Net cash used in operating activities was $2.4 million for the three months ended March 31, 2009 and $3.8 million for the three months ended March 31, 2008. Net cash used in operating activities for the three months ended March 31, 2009 was primarily attributable to the net loss of $8.0 million, an increase in accounts receivable of $1.1 million and a decrease in accounts payable and accrued liabilities of $2.4 million. The increase in accounts receivable was primarily due to an increase in revenues. The decrease in accounts payable and accrued liabilities was primarily due to the payment of inventory purchases made during 2008 and the payment of severance related expenses incurred as a result of the reduction in force that occurred during the fourth quarter of 2008. These uses of cash were partially offset by non-cash charges related to share-based compensation of $1.1 million and a goodwill impairment charge of $6.8 million. Net cash used in operating activities was $3.8 million for the three months ended March 31, 2008. Net cash used in operating activities for the three months ended March 31, 2008 was primarily attributable to a net loss of $3.6 million and increases in accounts receivable and inventory of $1.3 million and $1.0 million, respectively. The increase in accounts receivable was primarily due to an increase in and the timing of revenues. The increase in inventories was primarily related to anticipated growth and new product introductions. The increases were partially offset by a net increase in accounts payable and accrued liabilities of $0.8 million, due primarily to an increase in accounts payable associated with the purchase of inventories and an increase in operating expenses.
Cash flows provided by investing activities. Net cash provided by investing activities was $5.6 million for the three months ended March 31, 2009 and $4.3 million for the three months ended March 31, 2008. In the first three months of 2009, net cash provided by investing activities included $6.0 million related to the release of the restriction on our cash and cash equivalents, due to the re-payment of the borrowings under the National City credit facility. The three month period ended March 31, 2008 included maturities of investments of $5.1 million, For each of these periods, net cash provided by investing activities reflected purchases of property and equipment of $0.4 million and $0.8 million, respectively.
Cash flows used in financing activities. Net cash used in financing activities was $6.1 million for the three months ended March 31, 2009. For the three months ended March 31, 2009, cash flows used in financing activities included payments made on our debt and capital lease obligations of $6.0 million, including a $6.0 million repayment in full of our National City credit facility. For the three months ended March 31, 2008, cash flows used in financing activities reflected a $0.4 million repayment of a note associated with our acquisition of a product line and payments made on our debt and capital lease obligations of $0.1 million. These uses were partially offset by proceeds from the exercise of stock options of $0.1 million.
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