Psychemedics Corp (PMD, Financial) filed Quarterly Report for the period ended 2009-09-30.
Psychemedics Corporation provides testing services for the detection of abused substances through the analysis of hair samples. Their testing methods utilize a patented technology for performing immunoassays on enzymatically dissolved hair samples with confirmation testing by mass spectrometry. Psychemedics Corp has a market cap of $31.5 million; its shares were traded at around $6.06 with a P/E ratio of 27.5 and P/S ratio of 1.4. The dividend yield of Psychemedics Corp stocks is 7.9%. Psychemedics Corp had an annual average earning growth of 37.1% over the past 5 years.
Gross profit decreased $0.8 million to $2.9 million for the three months ended September 30, 2009, compared to $3.7 million for the three months ended September 30, 2008. Direct costs fell by $0.8 thousand or 30% for the three months ended September 30, 2009 compared to the same period in 2008, mainly due both to lower direct cost of service and from decreased labor and labor-related costs. The gross profit margin increased to 62% for the three months ended September 30, 2009 compared to 59% for the comparable period of 2008. Gross profit for the nine months ended September 30, 2009 decreased $3.7 million to $7.1 million compared to $10.8 million for the comparable period in 2008. Direct costs decreased by over $1.8 million or 24% for the nine months ended September 30, 2009 when compared to the same period in 2008, mainly due to decreased materials, labor and associated costs. The gross profit margin fell to 56% for the nine month period ended September 30, 2009 from 59% during the same period in 2008 due to the fact that labor costs were adjusted late in the period and their full financial impact did not take effect.
Research and development (R&D) expenses for the three months ended September 30, 2009 were $111 thousand, compared to $125 thousand for the comparable period of 2008, a decrease of 11%. R&D expenses represented 2% of revenue in the third quarters 2009 and 2008. Research and development expenses for the nine months ended September 30, 2009 were $354 thousand compared to $363 thousand for the nine months ended September 30, 2008. During these periods, R&D expenses represented 3% and 2% of revenue respectively.
Interest income for the three months ended September 30, 2009 decreased by $53 thousand to $12 thousand when compared to the same period of 2008 in which interest income was $65 thousand. Interest income represented interest earned on cash, cash equivalents and short-term investments. Decreasing interest rates on our mix of cash, cash equivalents and short-term investments caused the decrease in interest income for the three month period ended September 30, 2009. Interest income for the nine months ended September 30, 2009 decreased $216 thousand to $34 thousand as compared to $250 thousand for the same period in 2008. Decreasing interest rates on our mix of cash, cash equivalents and short-term investments, and a decline in the overall cash balances caused the decrease in interest income for the nine month periods ended September 30, 2009, compared to the same period in 2008.
At September 30, 2009, the Company had approximately $4.6 million of cash, cash equivalents and short-term investments. The Companys operating activities provided net cash of $544 thousand for the nine months ended September 30, 2009. Investing activities used $1.0 million in the nine month period while financing activities used $2.5 million during the period.
Cash provided by operating activities of $544 thousand reflected net income of $981 thousand adjusted for depreciation and amortization of $262 thousand, stock-based compensation expense of $305 thousand, along with income tax deferrals and a decrease in prepaid expenses and other current assets offset by higher accounts receivable balances, lower accounts payable and our accrued expense balances in 2009 versus 2008. Cash used in investing activities included a small amount of equipment and leasehold improvements which were purchased during the first nine months of 2009. The company also used approximately $1.0 million in the purchase of a certificate of deposit which had a maturity of over 90 days.
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Psychemedics Corporation provides testing services for the detection of abused substances through the analysis of hair samples. Their testing methods utilize a patented technology for performing immunoassays on enzymatically dissolved hair samples with confirmation testing by mass spectrometry. Psychemedics Corp has a market cap of $31.5 million; its shares were traded at around $6.06 with a P/E ratio of 27.5 and P/S ratio of 1.4. The dividend yield of Psychemedics Corp stocks is 7.9%. Psychemedics Corp had an annual average earning growth of 37.1% over the past 5 years.
Highlight of Business Operations:
Revenue for the third quarter of 2009 was $4.7 million, a decrease of 25% from third quarter 2008 revenue of $6.2 million. A drop in testing volume was the reason for the decrease in revenue. The Company reported net income of $0.15 and $0.17 per diluted share for the three months ended September 30, 2009 and 2008, respectively. At September 30, 2009, the Company had $3.6 million of cash, cash equivalents and short-term investments. The Company distributed $623 thousand or $0.12 per share of cash dividends to its shareholders in the three months ended September 30, 2009. The Company has paid fifty-two consecutive quarterly cash dividends.Gross profit decreased $0.8 million to $2.9 million for the three months ended September 30, 2009, compared to $3.7 million for the three months ended September 30, 2008. Direct costs fell by $0.8 thousand or 30% for the three months ended September 30, 2009 compared to the same period in 2008, mainly due both to lower direct cost of service and from decreased labor and labor-related costs. The gross profit margin increased to 62% for the three months ended September 30, 2009 compared to 59% for the comparable period of 2008. Gross profit for the nine months ended September 30, 2009 decreased $3.7 million to $7.1 million compared to $10.8 million for the comparable period in 2008. Direct costs decreased by over $1.8 million or 24% for the nine months ended September 30, 2009 when compared to the same period in 2008, mainly due to decreased materials, labor and associated costs. The gross profit margin fell to 56% for the nine month period ended September 30, 2009 from 59% during the same period in 2008 due to the fact that labor costs were adjusted late in the period and their full financial impact did not take effect.
Research and development (R&D) expenses for the three months ended September 30, 2009 were $111 thousand, compared to $125 thousand for the comparable period of 2008, a decrease of 11%. R&D expenses represented 2% of revenue in the third quarters 2009 and 2008. Research and development expenses for the nine months ended September 30, 2009 were $354 thousand compared to $363 thousand for the nine months ended September 30, 2008. During these periods, R&D expenses represented 3% and 2% of revenue respectively.
Interest income for the three months ended September 30, 2009 decreased by $53 thousand to $12 thousand when compared to the same period of 2008 in which interest income was $65 thousand. Interest income represented interest earned on cash, cash equivalents and short-term investments. Decreasing interest rates on our mix of cash, cash equivalents and short-term investments caused the decrease in interest income for the three month period ended September 30, 2009. Interest income for the nine months ended September 30, 2009 decreased $216 thousand to $34 thousand as compared to $250 thousand for the same period in 2008. Decreasing interest rates on our mix of cash, cash equivalents and short-term investments, and a decline in the overall cash balances caused the decrease in interest income for the nine month periods ended September 30, 2009, compared to the same period in 2008.
At September 30, 2009, the Company had approximately $4.6 million of cash, cash equivalents and short-term investments. The Companys operating activities provided net cash of $544 thousand for the nine months ended September 30, 2009. Investing activities used $1.0 million in the nine month period while financing activities used $2.5 million during the period.
Cash provided by operating activities of $544 thousand reflected net income of $981 thousand adjusted for depreciation and amortization of $262 thousand, stock-based compensation expense of $305 thousand, along with income tax deferrals and a decrease in prepaid expenses and other current assets offset by higher accounts receivable balances, lower accounts payable and our accrued expense balances in 2009 versus 2008. Cash used in investing activities included a small amount of equipment and leasehold improvements which were purchased during the first nine months of 2009. The company also used approximately $1.0 million in the purchase of a certificate of deposit which had a maturity of over 90 days.
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