BSD Medical Corp. (BSDM, Financial) filed Quarterly Report for the period ended 2009-02-28.
BSD Medical Corporation develops manufactures markets and services systems to treat cancer and benign diseases using heat therapy as provided by focused radio frequency and microwave energy. It also develops cancer therapy systems that employ precision-guided RF/microwave energy to deliver therapeutic heat into tumors to kill cancer cells and make radiation and/or chemotherapy more effective. BSD Medical is also making major progress in the application of its technology for other therapies. BSD Medical Corp. has a market cap of $41.3 million; its shares were traded at around $1.89 with and P/S ratio of 8.1. BSD Medical Corp. had an annual average earning growth of 15.8% over the past 10 years.
In the six months ended February 28, 2009, we earned $1,836,097, or 94%, of our revenues from sales to unrelated parties, as compared to $1,120,242, or 39%, in the six months ended February 29, 2008, with the increase due primarily to higher prices per system sold in the current fiscal year. These sales for the six months ended February 28, 2009 consisted of product sales of $1,789,040, service of $30,343, probes of $2,402 and other revenue of $14,312. By comparison, these sales for the six months ended February 29, 2008 consisted of product sales of $1,055,700, service of $24,866, probes of $14,447 and other revenues of $25,229.
In the six months ended February 28, 2009, we earned $125,496, or approximately 6%, of our revenues from sales to related parties as compared to $1,743,138 or approximately 61%, in the six months ended February 29, 2008. These sales were to Medizin-Technik and decreased in the current fiscal year primarily due to a decrease in the number of systems sold. The sales consisted of sales of component parts of $65,839, sales of probes of $27,713 and other revenues of $31,944 in the six months ended February 28, 2009. We had no related party system sales in the six months ended February 28, 2009. These sales for the six months ended February 29, 2008 consisted of product sales of $1,682,712, sales of probes of $19,425 and other revenues of $41,001.
(Provision) Benefit for Income Taxes: The income tax benefit in the three months ended February 28, 2009 and February 29, 2008 was $1,255,000 and $268,000, respectively, consisting of a current tax benefit. The income tax benefit of $1,006,000 in the six months ended February 28, 2009 is comprised of a current income tax benefit of $1,235,000, partially offset by a deferred income tax provision of $229,000. By comparison, the income tax benefit for the six months ended February 29, 2008 was $311,000, comprised of a current benefit of $479,000, partially offset by a deferred provision of $168,000. The current income tax benefit in all periods presented represents an increase to our income tax receivable resulting from our ability to carry back our taxable loss in the current period to offset income taxes previously paid.
Net Loss: During the three months ended February 28, 2009 we had a net loss of $4,535,207, after recording an income tax benefit of $1,255,000, as compared to a net loss of $406,837, after recording an income tax benefit of $268,000 in the three months ended February 29, 2008. During the six months ended February 28, 2009 we had a net loss of $5,968,352, after recording an income tax benefit of $1,006,000, as compared to a net loss of $1,022,772, after recording an income tax benefit of $311,000 in the six months ended February 29, 2008. The increase in the net loss in the current fiscal year is due primarily to the decrease in total revenues, increase in total operating costs and expenses, and increase in realized loss on investments as discussed above.
During the six months ended February 28, 2009, we used cash of $1,044,665 in operating activities, primarily as a result of our net loss partially offset by the non-cash realized loss on investments, stock-based compensation and other non-cash expenses, increase in income tax receivable of $99,454, increase in inventories of $287,360, decrease in accounts payable of $14,272, decrease in accrued liabilities of $16,047, decrease in customer deposits of $197,669, and decrease in deferred revenue of $23,008, partially offset by a decrease in receivables of $462,173 and a decrease in other current assets of $70,116. By comparison, net cash used in operating activities was $1,469,060 during the six months ended February 29, 2008, which included an increase in accounts receivable of $447,878, increase in income tax receivable of $555,000, increase in inventories of $105,652, decrease in customer deposits of $129,888, and decrease in deferred revenue of $15,444, partially offset by a decrease in other current assets of $62,520, decrease in deferred tax assets of $244,000 and an increase in accounts payable of $110,610.
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BSD Medical Corporation develops manufactures markets and services systems to treat cancer and benign diseases using heat therapy as provided by focused radio frequency and microwave energy. It also develops cancer therapy systems that employ precision-guided RF/microwave energy to deliver therapeutic heat into tumors to kill cancer cells and make radiation and/or chemotherapy more effective. BSD Medical is also making major progress in the application of its technology for other therapies. BSD Medical Corp. has a market cap of $41.3 million; its shares were traded at around $1.89 with and P/S ratio of 8.1. BSD Medical Corp. had an annual average earning growth of 15.8% over the past 10 years.
Highlight of Business Operations:
Non-Related Party Sales: In the three months ended February 28, 2009, we earned $627,701, or 86%, of our revenues from sales to unrelated parties, as compared to $640,539, or 43%, in the three months ended February 29, 2008. We sold fewer systems in the second quarter of the current fiscal year, but did sell one higher priced system. These sales for the three months ended February 28, 2009 consisted of product sales of $610,000, service of $14,701, and other revenue of $3,000. By comparison, these sales for the three months ended February 29, 2008 consisted of product sales of $620,700, service of $9,495, probes of $600 and other revenues of $9,744.In the six months ended February 28, 2009, we earned $1,836,097, or 94%, of our revenues from sales to unrelated parties, as compared to $1,120,242, or 39%, in the six months ended February 29, 2008, with the increase due primarily to higher prices per system sold in the current fiscal year. These sales for the six months ended February 28, 2009 consisted of product sales of $1,789,040, service of $30,343, probes of $2,402 and other revenue of $14,312. By comparison, these sales for the six months ended February 29, 2008 consisted of product sales of $1,055,700, service of $24,866, probes of $14,447 and other revenues of $25,229.
In the six months ended February 28, 2009, we earned $125,496, or approximately 6%, of our revenues from sales to related parties as compared to $1,743,138 or approximately 61%, in the six months ended February 29, 2008. These sales were to Medizin-Technik and decreased in the current fiscal year primarily due to a decrease in the number of systems sold. The sales consisted of sales of component parts of $65,839, sales of probes of $27,713 and other revenues of $31,944 in the six months ended February 28, 2009. We had no related party system sales in the six months ended February 28, 2009. These sales for the six months ended February 29, 2008 consisted of product sales of $1,682,712, sales of probes of $19,425 and other revenues of $41,001.
(Provision) Benefit for Income Taxes: The income tax benefit in the three months ended February 28, 2009 and February 29, 2008 was $1,255,000 and $268,000, respectively, consisting of a current tax benefit. The income tax benefit of $1,006,000 in the six months ended February 28, 2009 is comprised of a current income tax benefit of $1,235,000, partially offset by a deferred income tax provision of $229,000. By comparison, the income tax benefit for the six months ended February 29, 2008 was $311,000, comprised of a current benefit of $479,000, partially offset by a deferred provision of $168,000. The current income tax benefit in all periods presented represents an increase to our income tax receivable resulting from our ability to carry back our taxable loss in the current period to offset income taxes previously paid.
Net Loss: During the three months ended February 28, 2009 we had a net loss of $4,535,207, after recording an income tax benefit of $1,255,000, as compared to a net loss of $406,837, after recording an income tax benefit of $268,000 in the three months ended February 29, 2008. During the six months ended February 28, 2009 we had a net loss of $5,968,352, after recording an income tax benefit of $1,006,000, as compared to a net loss of $1,022,772, after recording an income tax benefit of $311,000 in the six months ended February 29, 2008. The increase in the net loss in the current fiscal year is due primarily to the decrease in total revenues, increase in total operating costs and expenses, and increase in realized loss on investments as discussed above.
During the six months ended February 28, 2009, we used cash of $1,044,665 in operating activities, primarily as a result of our net loss partially offset by the non-cash realized loss on investments, stock-based compensation and other non-cash expenses, increase in income tax receivable of $99,454, increase in inventories of $287,360, decrease in accounts payable of $14,272, decrease in accrued liabilities of $16,047, decrease in customer deposits of $197,669, and decrease in deferred revenue of $23,008, partially offset by a decrease in receivables of $462,173 and a decrease in other current assets of $70,116. By comparison, net cash used in operating activities was $1,469,060 during the six months ended February 29, 2008, which included an increase in accounts receivable of $447,878, increase in income tax receivable of $555,000, increase in inventories of $105,652, decrease in customer deposits of $129,888, and decrease in deferred revenue of $15,444, partially offset by a decrease in other current assets of $62,520, decrease in deferred tax assets of $244,000 and an increase in accounts payable of $110,610.
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