NMT Medical Inc. (NMTI, Financial) filed Quarterly Report for the period ended 2010-09-30.
Nmt Medical Inc. has a market cap of $5.4 million; its shares were traded at around $0.341 with and P/S ratio of 0.5. NMTI is in the portfolios of Jim Simons of Renaissance Technologies LLC, Chuck Royce of Royce& Associates.
Research and Development. Research and development expense decreased approximately $360,000, or 17.7%, for the three months ended September 30, 2010 compared with the three months ended September 30, 2009. The decrease in research and development expenses was primarily due to reduced costs associated with our clinical trials and the timing of expenditures related to our development programs. Additional savings resulted from lower personnel costs. We currently expect full year 2010 research and development expense to decrease to approximately $7.0 million compared to approximately $8.9 million in 2009. This anticipated decrease is primarily related to the completion of our clinical trial enrollment and patient follow-up work.
General and Administrative. General and administrative expense increased approximately $400,000, or 29.0%, for the three months ended September 30, 2010 compared with the three months ended September 30, 2009. Included in general and administrative expense for the three months ended September 30, 2010 are severance costs for our former CEO of approximately $250,000. Included as a reduction to general and administrative expense for the three months ended September 30, 2009, is a payment received of $250,000 pursuant to a settlement agreement with Cardia, Inc. Reductions in expense for the three months ended September 30, 2010, compared to the comparable prior period occurred in payroll costs, insurance costs and professional fees.
General and administrative expense is currently expected to increase to approximately $7.0 million in 2010 compared to approximately $6.8 million in 2009, as a result of non-recurring transactions impacting the prior year. In 2009, payments received pursuant to settlements with Cardia, Inc. and Gore, Inc. of $1.2 million and $800,000 respectively, were recorded as reductions to general and administrative expense.
Gain on Change in Fair Value of Warrants. The liability related to warrants issued to investors in connection with the February 16, 2010 private placement was initially recorded at fair market value and is adjusted to fair market value at the end of each reporting period. The decrease in the liability from June 30, 2010 to September 30, 2010 of $175,000 was due primarily to the decrease in our stock price during that period from $0.52 to $0.41. The market price for our common stock has been and is expected to be volatile. Consequently, future fluctuations in the price of our common stock may cause significant increases or decreases in the reported value of the warrant liability.
Income Tax Provision. We provide for income taxes based upon our anticipated effective income tax rate. Income tax expense for the three months ended September 30, 2010, included the recognition of return-to-provision adjustments made in connection with our fiscal 2009 tax return filings. The provision for income tax for the three months ended September 30, 2010 and 2009, also included the recognition of income tax expense of $9,309 and $9,571, respectively, for the establishment of a liability for uncertain tax positions, which do not impact our measurement of required valuation allowance on unrealized deferred tax assets.
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Nmt Medical Inc. has a market cap of $5.4 million; its shares were traded at around $0.341 with and P/S ratio of 0.5. NMTI is in the portfolios of Jim Simons of Renaissance Technologies LLC, Chuck Royce of Royce& Associates.
Highlight of Business Operations:
Cost of Product Sales. For the three months ended September 30, 2010, cost of product sales, as a percentage of total product sales, was approximately 54.5% compared with approximately 39.8% in the corresponding period in 2009. The increase in cost of product sales as a percentage of product sales was primarily the result of the impact of fixed manufacturing overhead expenses on lower than budgeted production volumes. In addition, royalty expenses also increased as a percentage of sales due to lower sales volumes. For the full year 2010, we currently expect cost of product sales to be approximately 50.0% of total product sales, compared with approximately 41.6% for fiscal 2009. Included in cost of product sales are royalty expenses of approximately $372,000 and $465,000 for the three months ended September 30, 2010 and 2009, respectively.Research and Development. Research and development expense decreased approximately $360,000, or 17.7%, for the three months ended September 30, 2010 compared with the three months ended September 30, 2009. The decrease in research and development expenses was primarily due to reduced costs associated with our clinical trials and the timing of expenditures related to our development programs. Additional savings resulted from lower personnel costs. We currently expect full year 2010 research and development expense to decrease to approximately $7.0 million compared to approximately $8.9 million in 2009. This anticipated decrease is primarily related to the completion of our clinical trial enrollment and patient follow-up work.
General and Administrative. General and administrative expense increased approximately $400,000, or 29.0%, for the three months ended September 30, 2010 compared with the three months ended September 30, 2009. Included in general and administrative expense for the three months ended September 30, 2010 are severance costs for our former CEO of approximately $250,000. Included as a reduction to general and administrative expense for the three months ended September 30, 2009, is a payment received of $250,000 pursuant to a settlement agreement with Cardia, Inc. Reductions in expense for the three months ended September 30, 2010, compared to the comparable prior period occurred in payroll costs, insurance costs and professional fees.
General and administrative expense is currently expected to increase to approximately $7.0 million in 2010 compared to approximately $6.8 million in 2009, as a result of non-recurring transactions impacting the prior year. In 2009, payments received pursuant to settlements with Cardia, Inc. and Gore, Inc. of $1.2 million and $800,000 respectively, were recorded as reductions to general and administrative expense.
Gain on Change in Fair Value of Warrants. The liability related to warrants issued to investors in connection with the February 16, 2010 private placement was initially recorded at fair market value and is adjusted to fair market value at the end of each reporting period. The decrease in the liability from June 30, 2010 to September 30, 2010 of $175,000 was due primarily to the decrease in our stock price during that period from $0.52 to $0.41. The market price for our common stock has been and is expected to be volatile. Consequently, future fluctuations in the price of our common stock may cause significant increases or decreases in the reported value of the warrant liability.
Income Tax Provision. We provide for income taxes based upon our anticipated effective income tax rate. Income tax expense for the three months ended September 30, 2010, included the recognition of return-to-provision adjustments made in connection with our fiscal 2009 tax return filings. The provision for income tax for the three months ended September 30, 2010 and 2009, also included the recognition of income tax expense of $9,309 and $9,571, respectively, for the establishment of a liability for uncertain tax positions, which do not impact our measurement of required valuation allowance on unrealized deferred tax assets.
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