Patient Safety Technologies Reports Second Quarter Results

Friday, September 18, 2009 General News
Email Print This Page Comment bookmark
Font : A-A+

TEMECULA, Calif., Aug. 6 Patient Safety Technologies, Inc. (OTC Bulletin Board: PSTX) today announced record quarterly revenues.

"We are pleased to announce record second quarter revenues," stated Steven H. Kane, Chief Executive Officer of Patient Safety Technologies. "An increasing number of the nation's most prestigious medical institutions are adopting the Safety Sponge((TM)) System as the solution to the problem of retained surgical sponges. We see our unique technology progressing towards becoming the industry's standard of care. The company recently passed the 500,000 procedure milestone using our Safety Sponge((TM)) System, more than triple the sum of all of our competitors combined." Kane added, "Patient Safety Technologies is committed to applying its proven solutions to help hospitals face the challenges of improving patient safety, while at the same time increasing productivity and reducing costs. Additionally, we will continue to grow our potential market by working with the medical community to expand the application of our patented technology to address additional critical problem areas."

Second Quarter and Half-Year Results

Revenues for second quarter 2009 were $1.0 million, an increase of 85% over the $557 thousand reported for second quarter 2008, and an increase over first quarter 2009 revenue of $936 thousand. Second quarter 2009 sales of the company's core sponge products reached $1.0 million vs. $732 thousand in first quarter 2009. This 37% increase in sponge sales reflects the continued expansion in the company's installed customer base. Gross margin for the quarter ended June 30, 2009 was 40%, a decrease over the 41% gross margin for the quarter ended June 30, 2008

Loss from operations before income taxes for second quarter 2009 was comprised of $1.8 million from direct operations plus $2.2 million in non-cash warrant expense, totaling $4.0 million. This compares to a loss before income taxes of $2.4 million for second quarter of 2008. Warrant expense is based on derivative liability from our outstanding stock warrants, due to the appreciation in our stock price during the quarter.

Revenues for the six months ended June 30, 2009 were $2.0 million, an increase of 86% over the $1.1 million for the six months ended June 30, 2008. Gross margin for the six months ended June 30, 2009 was 41%, an increase over the 32% gross margin for the six months ended June 30, 2008. The increase in gross margin was primarily the result of increased sales of our core Safety-Sponge((TM)) products, which have a higher gross margin than other products.

Loss from operations before income taxes for the six months ended June 30, 2009 was $7.5 million compared to a loss of $4.0 million for the six months ended June 30, 2008. The increase in our loss from operations was primarily the result of non-cash warrant expense. Warrant expense is based on derivative liability from our outstanding stock warrants, due to the appreciation in our stock price during the six months ended June 30, 2009.

About Patient Safety Technologies, Inc. and SurgiCount Medical, Inc.

Patient Safety Technologies, Inc., through its wholly-owned operating subsidiary, SurgiCount Medical, Inc., provides the Safety-Sponge((TM)) System, a system designed to improve the standard of patient care while reducing healthcare costs by preventing the occurrence of retained surgical sponges and towels, one of the most common errors in surgery. For more information, contact Patient Safety Technologies at (951) 587-6201, or visit

Forward Looking Statements: This press release contains forward-looking statements that involve risks and uncertainties, including statements relating to Patient Safety Technologies' current expectations for future revenue and other financial results, and adoption of our technology by additional customers. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements. Actual results may differ materially from the results predicted. Although we believe that the plans or expectations reflected in or suggested by our forward-looking statements are reasonable, those statements are based only on the current beliefs and assumptions of our management and on information currently available to us and, therefore, they involve uncertainties and risks as to what may happen in the future. Accordingly, we cannot guarantee that our plans and expectations will be achieved. Our actual results and stockholder values could be very different from and worse than those expressed in or implied by any forward-looking statement in this report as a result of many known and unknown factors, many of which are beyond our ability to predict or control. These factors include, but are not limited to, those described in Part I, Item 1A of our annual report on Form 10-K for the year ended December 31, 2008, including without limitation the following: The early stage of adoption of our Safety-Sponge System and the unpredictability of our sales cycle; our need for additional financing to support our business; any failure of our new management team to operate effectively; our reliance on third-party manufacturers, some of whom are sole-source suppliers; and any inability to successfully defend our intellectual property portfolio All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements.

Our forward-looking statements speak only as of the date they are made and should not be relied upon as representing our plans and expectations as of any subsequent date. Although we may elect to update or revise forward-looking statements at some time in the future, we specifically disclaim any obligation to do so, even if our plans and expectations change.

PATIENT SAFETY TECHNOLOGIES, INC. BALANCE SHEET (In thousands, except par value) June 30, December 31, 2009 2008* ---- ---- (unaudited) Assets Current assets: Cash and cash equivalents $251 $296 Accounts receivable 188 418 Inventories 657 200 Prepaid expenses 219 188 --- --- Total current assets 1,315 1,102 Restricted certificate of deposit 94 94 Notes receivable 121 121 Property and equipment, net 474 622 Goodwill 1,832 1,832 Patents, net 3,276 3,439 Long-term investment 667 667 Other assets 29 37 -- -- Total assets $7,808 $7,914 ====== ====== Liabilities and Stockholders' (Deficit) Equity Current liabilities Accounts payable $1,770 $909 Current portion of convertible debentures 1,425 1,425 Current portion of notes payable 600 1,100 Accrued liabilities 9,983 3,358 ----- ----- Total current liabilities 13,778 6,792 Long-term convertible debentures, less current portion 53 51 Long-term notes payable, less current portion 1,530 - Deferred tax liabilities 979 1,042 --- ----- Total liabilities 16,340 7,885 ------ ----- Stockholders' equity: Convertible preferred stock, $1.00 par value, cumulative 7% dividend: 1,000 shares authorized; 11 issued and outstanding at June 30, 2009 and December 31, 2008: (Liquidation preference of $1.2 million at June 30, 2009 and December 31, 2008 11 11 Common stock, $0.33 par value: 25,000 shares authorized; 17,198 shares issued and outstanding at June 30, 2009 and December 31, 2008; 5,675 5,675 Additional paid-in capital 35,767 36,034 Accumulated deficit (49,985) (41,691) ------- ------- Total stockholders' (deficit) equity (8,532) 29 ------ -- Total liabilities and stockholders' equity $7,808 $7,914 ====== ====== * Derived from audited financial statements for year ended December 31, 2008 PATIENT SAFETY TECHNOLOGIES, INC. CONSOLIDATED STATEMENT OF OPERATIONS (In thousands, except per share data) (unaudited) For the Six For the Quarter Months Ending Ending June 30, June 30, 2009 2008 2009 2008 ---- ---- ---- ---- Revenues $1,028 $557 $1,964 $1,057 Cost of revenue 619 326 1,168 719 --- --- ----- --- Gross profit 409 231 796 338 Operating expenses: Research and development 86 38 199 81 Sales and marketing 553 682 1,202 1,134 General and administrative 1,361 1,687 2,616 2,723 ----- ----- ----- ----- Total operating expenses 2,000 2,407 4,017 3,938 ----- ----- ----- ----- Operating loss (1,591) (2,176) (3,221) (3,600) Other income (expenses): Interest expense (220) (88) (440) (175) Change in fair value of warrant liability (2,155) (168) (3,867) (168) Realized gain (loss) assets held for sale, net - - - (25) Unrealized loss on assets held for sale, net - - - (65) --- --- --- --- Total other income (expense) (2,375) (256) (4,307) (433) ------ ---- ------ ---- Loss from operations before income taxes (3,966) (2,432) (7,528) (4,033) Income tax provision 31 32 65 65 -- -- -- -- Net income (loss) (3,935) (2,400) (7,463) (3,968) Preferred dividends (19) (19) (38) (38) --- --- --- --- Net loss applicable to common shareholders $(3,954) $(2,419) $(7,501) $(4,006) ======= ======= ======= ======= Net loss per common share - basic and diluted $(0.23) $(0.19) $(0.44) $(0.32) ====== ====== ====== ====== Weighted average common shares outstanding: Basic and diluted 17,198 13,054 17,198 12,567 ====== ====== ====== ======

SOURCE Patient Safety Technologies, Inc.

Post your Comments

Comments should be on the topic and should not be abusive. The editorial team reserves the right to review and moderate the comments posted on the site.
* Your comment can be maximum of 2500 characters
I agree to the terms and conditions

News A - Z


News Search

Medindia Newsletters

Subscribe to our Free Newsletters!

Terms & Conditions and Privacy Policy.

Find a Doctor

Press Release Category

Press Release Archive

Stay Connected

  • Available on the Android Market
  • Available on the App Store