Bioanalytical Systems Inc. (BASI, Financial) filed Quarterly Report for the period ended 2008-12-31.
Bioanalytical Systems Inc. is a contract research organization providing research and development resources to many of the leading pharmaceutical medical device and biotechnology companies in the world. The company offers an efficient variable-cost alternative to its clients' internal product development compliance and quality control programs. The company provides a broad array of value-added services and products focused on chemical analysis allowing its clients to perform their research and development functions either ``in-house`` or at the company. Bioanalytical Systems Inc. has a market cap of $5.9 million; its shares were traded at around $1.23 with and P/S ratio of 0.14.
Sales in our Products segment decreased 17.4% from $2,530 to $2,089 when compared to the same period in the prior year. The majority of the decrease stems from sales of our Culex automated in vivo sampling systems, which declined $815, or 47.1%. Slightly offsetting the decline was an increase in sales of our more mature analytical products of $225 or 32.0% over the same period last year.
Net cash provided by continuing operating activities was $265 for the three months ended December 31, 2008 compared to $2,713 for the three months ended December 31, 2007. The decrease in cash provided by continuing operating activities in the current fiscal quarter partially results from a decrease in earnings from continuing operations as well as decreases in accounts payable of $997 and customer advances of $652. These were partially offset by a decrease in accounts receivable of $2,920. Also included in operating activities for the first quarter of fiscal 2009 is the non-cash loss of $137 recorded to reflect the fair value of our interest rate swaps. The impact on operating cash flow of other changes in working capital was not material.
Financing activities used $670 in the first three months of fiscal 2009 as compared to $3,286 used for the first three months of fiscal 2008. The main use of cash in the first quarter of fiscal 2009 was for long term debt and capital lease payments of $294 as well as net payments on our line of credit of $376. In the first quarter of fiscal 2008, we repaid the balance of our subordinated debt, approximately $4,500, which was partially offset by $1,400 of additional borrowings.
On December 18, 2007, we entered into a loan agreement with Regions Bank (“Regions”) under which Regions loaned us $1,400 under a term loan maturing December 18, 2010. Interest on the loan is equal to LIBOR plus 215 basis points. Monthly payments are $12 plus interest. The loan is collateralized by real estate at the Company s West Lafayette and Evansville, Indiana locations. Regions also holds approximately $7,700 of mortgages on these facilities. A portion of the $1,400 loan was used to repay our subordinated debt of approximately $4,500 during the first quarter of the prior fiscal year while existing cash on hand made up the balance of the payment. We entered into interest rate swap agreements with respect to this loan to fix the interest rate at 6.1%. We entered into the derivative transactions to hedge interest rate risk of this debt obligation and not to speculate on interest rates. As a result of recent declines in short term interest rates, the swaps had a fair value to the bank of $137 at December 31, 2008, which was recorded in our condensed consolidated financial statements as interest expense and long term liability. The fair value of these swaps was not material to the condensed consolidated financial statements in the comparable period of the prior fiscal year.
Based on our current business activities and cash on hand, we expect to continue to borrow on our revolving credit facility to finance working capital and only necessary capital expenditures since we instituted a freeze on capital expenditures. As of December 31, 2008, we had $3,094 of total borrowing capacity, of which $1,647 was outstanding, and $451 of cash on hand. The decrease in our total borrowing capacity from the fiscal year 2008 ended September 30, 2008 was due to several factors. Declining sales in the first quarter of fiscal 2009 led to a lower accounts receivable balance, which reduces the total borrowing capacity. As discussed above, we expect the sales decline due to lower new bookings and sponsor delays to continue through the second quarter of fiscal 2009. Accounts receivable is also expected to decline during the same period, which could lower our total borrowing capacity.
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Bioanalytical Systems Inc. is a contract research organization providing research and development resources to many of the leading pharmaceutical medical device and biotechnology companies in the world. The company offers an efficient variable-cost alternative to its clients' internal product development compliance and quality control programs. The company provides a broad array of value-added services and products focused on chemical analysis allowing its clients to perform their research and development functions either ``in-house`` or at the company. Bioanalytical Systems Inc. has a market cap of $5.9 million; its shares were traded at around $1.23 with and P/S ratio of 0.14.
Highlight of Business Operations:
Our Service revenue decreased 25.5% to $5,987 in the current quarter compared to $8,035 for the prior year period primarily as a result of decreases in bioanalytical analysis and toxicology revenues. Our bioanalytical analysis revenues decreased $816, a 19.4% decrease from the same quarter in fiscal 2008, due to study delays by clients and decreases in new bookings. Toxicology revenues decreased $978 or 34.3% over the prior year period. Study delays and cancellations contributed to the decline for the toxicology group as well. Partially offsetting these decreases was an increase in pharmaceutical analysis revenues of $89 or 17.4% over the prior year period.Sales in our Products segment decreased 17.4% from $2,530 to $2,089 when compared to the same period in the prior year. The majority of the decrease stems from sales of our Culex automated in vivo sampling systems, which declined $815, or 47.1%. Slightly offsetting the decline was an increase in sales of our more mature analytical products of $225 or 32.0% over the same period last year.
Net cash provided by continuing operating activities was $265 for the three months ended December 31, 2008 compared to $2,713 for the three months ended December 31, 2007. The decrease in cash provided by continuing operating activities in the current fiscal quarter partially results from a decrease in earnings from continuing operations as well as decreases in accounts payable of $997 and customer advances of $652. These were partially offset by a decrease in accounts receivable of $2,920. Also included in operating activities for the first quarter of fiscal 2009 is the non-cash loss of $137 recorded to reflect the fair value of our interest rate swaps. The impact on operating cash flow of other changes in working capital was not material.
Financing activities used $670 in the first three months of fiscal 2009 as compared to $3,286 used for the first three months of fiscal 2008. The main use of cash in the first quarter of fiscal 2009 was for long term debt and capital lease payments of $294 as well as net payments on our line of credit of $376. In the first quarter of fiscal 2008, we repaid the balance of our subordinated debt, approximately $4,500, which was partially offset by $1,400 of additional borrowings.
On December 18, 2007, we entered into a loan agreement with Regions Bank (“Regions”) under which Regions loaned us $1,400 under a term loan maturing December 18, 2010. Interest on the loan is equal to LIBOR plus 215 basis points. Monthly payments are $12 plus interest. The loan is collateralized by real estate at the Company s West Lafayette and Evansville, Indiana locations. Regions also holds approximately $7,700 of mortgages on these facilities. A portion of the $1,400 loan was used to repay our subordinated debt of approximately $4,500 during the first quarter of the prior fiscal year while existing cash on hand made up the balance of the payment. We entered into interest rate swap agreements with respect to this loan to fix the interest rate at 6.1%. We entered into the derivative transactions to hedge interest rate risk of this debt obligation and not to speculate on interest rates. As a result of recent declines in short term interest rates, the swaps had a fair value to the bank of $137 at December 31, 2008, which was recorded in our condensed consolidated financial statements as interest expense and long term liability. The fair value of these swaps was not material to the condensed consolidated financial statements in the comparable period of the prior fiscal year.
Based on our current business activities and cash on hand, we expect to continue to borrow on our revolving credit facility to finance working capital and only necessary capital expenditures since we instituted a freeze on capital expenditures. As of December 31, 2008, we had $3,094 of total borrowing capacity, of which $1,647 was outstanding, and $451 of cash on hand. The decrease in our total borrowing capacity from the fiscal year 2008 ended September 30, 2008 was due to several factors. Declining sales in the first quarter of fiscal 2009 led to a lower accounts receivable balance, which reduces the total borrowing capacity. As discussed above, we expect the sales decline due to lower new bookings and sponsor delays to continue through the second quarter of fiscal 2009. Accounts receivable is also expected to decline during the same period, which could lower our total borrowing capacity.
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