TIDMAKR
RNS Number : 8731G
Akers Biosciences, Inc.
11 August 2016
Embargoed: 0700hrs 11 August 2016
This announcement contains inside information
Akers Biosciences, Inc.
Financial Results for the Six Months Ended June 30, 2016
Sales of Flagship Rapid HIT Test +68% Over H1 2015
Akers Biosciences, Inc. (NASDAQ: AKER) (AIM: AKR.L), ("Akers
Bio" or the "Company"), a developer of rapid health information
technologies, reports its financial results for the six months
ended June 30, 2016. The Form 10-Q containing the full financial
statements for the six months and three months ended June 30, 2016
will be available for viewing on the Company's website at
www.akersbio.com or www.sec.gov later today.
H1 Financial Highlights:
-- Product revenue up 47% for H1 2016 to $1,694,510 (H1 2015:
$1,156,414); total revenue up 15% for H1 2016 to $1,694,510 (H1
2015: $1,476,970);
-- Sales of flagship PIFA Heparin/PF4 Rapid Assay products up
68% to $1,514,255 (H1 2015: $898,959)
-- Significant improvement in gross margin to 72% (H1 2015: 62%)
reflecting the increase in average sale price of PIFA Heparin/PF4
Rapid Assay products
-- Gross profit up 34% to $1,217,634 (H1 2015: $909,603)
-- Loss before income tax reduced by 26% to $(2,517,861) (H1 2015: $(3,408,028))
-- Cash and marketable securities at June 30, 2016 of $1,927,560
-- Reductions in key costs began to impact in Q2 2016 with full
effect expected to be realized in H2 2016
H1 Operational Highlights
-- Experiencing strong growth from flagship PIFA Heparin/PF4
Rapid Assay product sales boosted by sales to China ($2,500,000
order from Novotek for 2016 of which $505,380 shipped in H1 and
balance due in tranches through H2)
-- Strengthened commercial team with the appointments of Douglas
Carrara and Tony Saporito (both ex-Becton, Dickinson) in senior
sales and marketing roles
-- Restructuring of in-field sales and marketing team ongoing
for PIFA Heparin/PF4 Rapid Assay products to focus less on
individual hospitals and more on integrated delivery networks
(hospital groups)
-- Received Notice of Allowance for key US patent covering the
Company's flagship product, the PIFA Heparin/PF-4 Rapid Assay
-- Signed first distribution agreement for newly launched Akers
Wellness product, BreathScan OxiChek(TM), with Aero-Med - and
shipped first products
-- Completed clinical trial for rapid Chlamydia test - results
were highly successful with 96% overall agreement with reference
laboratory method
Commentary from Raymond F. Akers, Jr. PhD, Co-founder, Chief
Scientific Director and John J. Gormally, Chief Executive
Officer:
Akers Bio met its objectives in all key areas of the business
during H1. We saw 68% growth in sales of our flagship rapid test
for heparin-induced thrombocytopenia - which we are now selling in
volume in both China as well as the US. The Company is now tracking
a gross profit margin across the business in excess of 70%
reflecting the successful implementation of sales price increases
in our core product, while cost of production remained generally
the same. We signed our first distribution deal for a new Akers
Wellness product, BreathScan OxiChek(TM), with a major distributor
and shipped our first order. Furthermore, we made significant
advances in product development with the highly successful clinical
trial of our rapid, five-minute, finger stick blood test for
Chlamydia - the first of its kind.
Additionally, during Q2 we began realizing meaningful reductions
in operating costs related to the implementation of the cost
management program commenced at the end of Q1. These cost savings
will be fully realized in the second half of the year.
In product research and development, the Company made a major
advancement in the commercialization of the first rapid test for
Chlamydia, the most prevalent sexually transmitted disease in the
world, using a finger stick blood sample. A clinical trial was
carried out across two sites in the US. The results were highly
successful with overall agreement between the PIFA/Chlamydia Rapid
Assay and the reference laboratory method of 96% in patient
populations of acute infection and historical exposure.
Akers Bio's PIFA/Chlamydia Rapid Assay is an antibody test that
has been developed to identify infection of Chlamydia in five
minutes or less and we believe the availability of a rapid test in
doctors' offices or health clinics that does not require an
invasive genital swab procedure - and can lead to the provision of
immediate therapy - could have a significant impact in reducing the
spread of this disease. Akers Bio is pursuing FDA 510(k) market
clearance for the US for this product and is evaluating the
regulatory requirements in the territories covered by its
international distribution network.
The strong commercial performance enabled the Company to achieve
a 15% increase in total revenue for the period of $1,694,510,
resulting in a 34% increase in gross profit to $1,217,634.
Administrative, sales and marketing, R&D and other costs -
together with amortization of non-current assets - turned this into
a markedly reduced net loss for the period of $2,517,861 - down 26%
compared to H1 2015. We expect the net loss to continue to decline
as the impact of growing revenues and shrinking expenses takes
further hold in the second half.
Revenue from the Company's PIFA Heparin/PF4 Rapid Assay products
was boosted by the receipt of a $2.5 million order from Novotek,
the Company's exclusive distributor for these products in China.
Approximately $500,000 of this order was shipped and paid in the
first half with the material balance expected to be shipped and
payable in tranches throughout the remainder of the year. In the
US, we are in the process of reshaping the sales and marketing
strategy for this product to focus less on individual hospitals and
more on integrated delivery networks where the purchasing volume
potential of a single new customer with multiple hospitals in its
group has the capacity to dramatically transform domestic sales of
this product. This approach requires fewer sales personnel in the
field - and this is reflected in a reduction of sales and marketing
staff from 12 to 6 in the period - but going forward is likely to
require additional, more senior sales representatives with the
appropriate level of access to the integrated delivery network's
decision makers.
We were delighted to welcome two new accomplished senior sales
and marketing executives to the Company during the first half.
Douglas Carrara joined as Vice President, Global Marketing and
Commercial Operations. He has over 25 years' experience in the
clinical diagnostics arena, particularly within sales, marketing
and global operations. Tony Saporito joined as Vice President, US
Sales and Distribution. He has a track record of building and
leading high-performance businesses in the medical device and
clinical diagnostics areas for two decades.
Our first distribution agreement for the Company's digital
health and wellness information platform was established during the
period with Aero-Med. Developed by Akers Bio as part of the Akers
Wellness line, BreathScan OxiChek(TM) is the first disposable
breath test to rapidly determine levels of oxidative stress in the
body by measuring the levels of certain abundant free radicals.
Frequent use may help health practitioners to monitor and adjust
their clients' regimen of nutritional supplementation in order to
manage oxidative stress - an indicator of the overall health and
wellbeing of a person. OxiChek(TM) works with BreathScan Lync(TM),
the new bluetooth-enabled reading device from Akers Wellness, to
enable users to monitor oxidative stress via a mobile device.
Through Aero-Med, we are targeting the large anti-aging, functional
and integrative health and wellness treatment practitioner market
in the US, where first shipment was achieved at the end of Q2. We
are in active discussions with other distribution partners for
OxiChek(TM) with capabilities within other target markets and
believe this product could make an attractive contribution in the
second half of the year.
With approximately $2 million of sales to Novotek anticipated in
the second half for PIFA Heparin/PF4 Rapid Assay products in China,
and the continuing improvements in our domestic sales effort for
these products, we have very good visibility over revenues in our
core business. In addition, we expect to see contributions from
other tests, such as alcohol breathalyzers and BreathScan
OxiChek(TM), gaining momentum in the second half of the year. At
the same time the Company is implementing tight cost controls in
all key areas of the business. The Company has turned a corner and
the combined effect of improved sales and reduced costs is
accelerating the path to profitability - a goal which we believe is
now coming firmly into view.
Conference call information:
Thursday, August 11, 2016 at 2.00 p.m.
BST (9:00 a.m. Eastern Time)
International: 1-719-325-2499
US: 1-888-417-8465
Conference ID: 5673717
Webcast: https://public.viavid.com/index.php?id=120809.
About Akers Biosciences, Inc.
Akers Bio develops, manufactures, and supplies rapid screening
and testing products designed to deliver quicker and more
cost-effective healthcare information to healthcare providers and
consumers. The Company has advanced the science of diagnostics
while responding to major shifts in healthcare through the
development of several proprietary platform technologies. The
Company's state-of-the-art rapid diagnostic assays can be performed
virtually anywhere in minutes when time is of the essence. The
Company has aligned with major healthcare companies and high volume
medical product distributors to maximize product offerings, and to
be a major worldwide competitor in diagnostics.
Additional information on the Company and its products can be
found at www.akersbio.com. Follow us on Twitter @AkersBio.
For more information:
Akers Biosciences, Inc.
John J. Gormally (Chief Executive Officer)
Raymond F. Akers, Jr. PhD (Co-founder and Chief Scientific
Director)
Tel. +1 856 848 8698
Taglich Brothers, Inc. (Investor Relations)
Chris Schreiber
Tel. +1 917 445 6207
Email: cs@taglichbrothers.com
finnCap (UK Nominated Adviser and Broker)
Adrian Hargrave / Scott Mathieson (Corporate Finance)
Steve Norcross (Broking)
Tel. +44 (0)20 7220 0500
Vigo Communications (Public Relations)
Ben Simons / Fiona Henson
Tel. +44 (0)20 7830 9700
Email: akers@vigocomms.com
Summary of Statements of Operations for the Six Months Ended
June 30, 2016 and 2015
Revenue
Akers Bio's revenue for the six months ended June 30, 2016
totaled $1,694,510, a 15% increase from the six months ended June
30, 2015. Product revenue increased by 47%, primarily a result of
sales of our PIFA Heparin/PF4 Rapid Assay products. Total revenue
was impacted by the elimination of license fee revenue following
the cancellation of the License and Supply Agreement with
ChubeWorkx Guernsey Limited ("ChubeWorkx") in May, 2015 in respect
to BreathScan Alcohol Breathalyzer products.
The table below summarizes our revenue by product line for the
six months ended June 30, 2016 and 2015 as well as the percentage
of change year-over-year:
6 Months 6 Months
Ended Ended
Product Lines June 30, 2016 June 30, 2015 Percent Change
------------------------------------------ ---------------- ---------------- --------------
Particle ImmunoFiltration Assay ("PIFA") $ 1,514,255 $ 898,959 68%
MicroParticle Catalyzed Biosensor ("MPC") 109,703 209,805 (48)%
Other 70,552 47,650 48%
------------ ------------
Product Revenue Total $ 1,694,510 $ 1,156,414 47%
License Fees - 320,556 (100)%
------------ ------------
Total Revenue $ 1,694,510 $ 1,476,970 15%
------------ ------------
Revenue from the Company's PIFA Heparin/PF4 Rapid Assay products
increased 68% during the six months ended June 30, 2016 over the
same period of 2015, reflecting the partial fulfillment of the $2.5
million order from Novotek, our exclusive distributor in the
Peoples Republic of China.
The Company received a $2.5 million order for our PIFA
Heparin/PF4 Rapid Assay products from Novotek on February 29, 2016.
The Company received an initial payment of $250,000 on April 29,
2016 and a second payment of $250,000 on June 28, 2016 for
scheduled product shipments, per the terms of sale. The remaining
products will be scheduled to ship at various points throughout the
current fiscal year with revenue being recognized when the criteria
for the recognition of revenue is met. The Company recognized
$505,380 for PIFA Heparin/PF4 products from Novotek during the six
months ended June 30, 2016.
The Company's MPC product sales declined 48% during the six
months ended June 30, 2016 over the same period of 2015. A
distributor's initial stocking order of approximately $146,000 for
the Company's BreathScan Alcohol Breathalyzer products in Great
Britain was included for the six months ended June 30, 2015. Net of
this significant order, MPC product sales increased 72% for the six
months ended June 30, 2016.
While most of the MPC product sales in the six months ended June
30, 2016 came from BreathScan Alcohol Breathalyzers, we have begun
generating sales of other MPC products within our health and
wellness line, primarily the Company's BreathScan OxiChek(TM)
disposable breath test for oxidative stress.
Other operating revenue increased due to a rise in miscellaneous
component sales and shipping and handling fees.
The Company's gross margin improved significantly, rising to 72%
(2015: 62%) for the six months ended June 30, 2016. The improvement
is attributed to improved margins for the PIFA Heparin PF/4
products resulting from the increase in average selling price of
these products.
Cost of sales for the six months ended June 30, 2016 decreased
by 16% to $476,876 (2015: $567,367). Direct cost of sales decreased
to 13% of product revenue while other cost of sales decreased to
15% for the six months ended June 30, 2016 as compared to 24% and
25% respectively for the same period in 2015.
Direct cost of sales for the six month period ended June 30,
2016 were $216,087 (2015: $281,937). The decrease is attributed to
the offset of manufacturing costs to inventory.
Other cost of sales for the six months ended June 30, 2016 were
$260,789 (2015: $285,430). The decrease is attributed to reductions
in quality control testing and inventory shrinkage costs and is
offset by increases in manufacturing consumable supplies and
repairs and maintenance expenses.
General and Administrative Expenses
General and administrative expenses for the six months ended
June 30, 2016, totaled $1,739,806, which was a 29% decrease as
compared to $2,444,964 for the six months ended June 30, 2015.
The table below summarizes our general and administrative
expenses for the six months ended June 30, 2016 and 2015 as well as
the percentage of change year-over-year:
6 Months
6 Months Ended Ended
Description June 30, 2016 June 30, 2015 Percent Change
----------------------------------------- ---------------- ---------------- --------------
Personnel Costs $ 543,770 $ 417,101 30%
Professional Service Costs 477,094 498,470 (4)%
Stock Market & Investor Relations Costs 234,003 272,007 (14)%
Other General and Administrative Costs 484,939 1,257,386 (61)%
------------ ------------
Total General and Administrative Expense $ 1,739,806 $ 2,444,964 (29)%
------------ ------------
The increase in personnel costs for the six months ended June
30, 2016 is the result of increases in costs associated with
employee benefits and the addition of a staff accountant in June
2015 and the Company's new Chief Executive Officer in November
2015. These increases were offset by the transfer of Dr. Akers to
the Research and Development Department effective April 25,
2016.
Professional service costs decreased 4% for the six months ended
June 30, 2016 as compared to the same period of 2015. Decreases in
personnel recruiting and general consulting fees ($3,797 (2015:
$101,819)) was offset by increases in accounting and legal fees
($447,042 (2015: $346,975)).
A decline in investor relations fees ($130,436 (2015: $195,835))
during the six months ended June 30, 2016 was partially offset by
increases in general consulting ($61,127 (2015: $36,947)) resulting
in an overall reduction in stock market and investor relations
costs.
A significant decrease in bad debts expense ($146,196 (2015:
$864,000)) and travel expenses ($96,219 (2015: $143,396)) accounts
contributed to the 61% decrease in other general and administrative
costs for the six months ended June 30, 2016.
Sales and Marketing Expenses
Sales and marketing expenses for the six months ended June 30,
2016 totaled $1,238,754, which was a 10% increase as compared to
$1,128,792 for the six months ended June 30, 2015.
The table below summarizes our sales and marketing expenses for
the six months ended June 30, 2016 and 2015 as well as the
percentage of change year-over-year:
6 Months 6 Months
Ended Ended
Description June 30, 2016 June 30, 2015 Percent Change
--------------------------------------- ---------------- ---------------- --------------
Personnel Costs $ 714,796 $ 616,607 16%
Professional Service Costs 307,020 366,781 (16)%
Royalties and Outside Commission Costs 50,045 27,454 82%
Other Sales and Marketing Costs 166,893 117,950 41%
------------ ------------
Total Sales and Marketing Expenses $ 1,238,754 $ 1,128,792 10%
------------ ------------
Personnel costs increased by 16% during the six months ended
June 30, 2016 as compared to the same period of 2015. The Company
has reduced the number of sales and marketing staff from 12 on June
30, 2015 to 6 as of June 30, 2016. This temporary reduction in the
department's headcount is a result of the transition in the sales
and marketing strategy for the PIFA Heparin PF/4 products to focus
less on individual hospitals and more on integrated delivery
networks which require fewer but more senior level staff. The
Company replaced the sales and marketing senior management team
during the first half of 2016 resulting in increased costs
associated with severance programs.
The decrease in the use of contracted marketing services firms
($51,246 (2015: $120,547)) and general sales consultants ($220,289
(2015: $246,234)) resulted in a 16% decrease in professional
service costs. The Company terminated contracts with two firms,
resulting in cost savings of $28,500 per month.
Outside sales commissions increased in the six months ended June
30, 2016 ($50,045 (2015: $16,832)) as a result of the increased
sales of the PIFA products, both domestically and internationally.
The Company's royalty expenses for the six months ended June 30,
2016 were $- (2015: $10,622)) as the royalty program terminated as
of December 31, 2015.
Other sales and marketing costs increased primarily due to the
increased travel by the sales and marketing staff in support of our
customer and distributor base, expenses related to the
participation in trade shows and costs associated with the hosting
and maintenance of the Company's world-wide web presence.
Research and Development
Research and development expenses for the six months ended June
30, 2016 totaled $685,280 as compared to $683,799 for the six
months ended June 30, 2015.
The table below summarizes our research and development expenses
for the six months ended June 30, 2016 and 2015 as well as the
percentage of change year-over-year:
6 Months 6 Months
Ended Ended
Description June 30, 2016 June 30, 2015 Percent Change
---------------------------------------- ---------------- ---------------- --------------
Personnel Costs $ 378,553 $ 331,691 14%
Clinical Trial Costs 141,342 23,613 499%
Professional Service Costs 57,147 246,127 (77)%
Other Research and Development Costs 108,238 82,368 31%
------------ ------------
Total Research and Development Expenses $ 685,280 $ 683,799 -%
------------ ------------
Personnel costs increased 14% during the six months ended June
30, 2016 as compared to the same period of 2015 as a result of
increased base salaries from the transfer of Dr. Akers from the
General and Administrative Department effective April 25, 2016 and
the employment of a new Director of Quality Assurance.
The Company had two clinical trials in-process during the six
months ended June 30, 2016 resulting in a significant increase in
costs associated with these programs. The on-going trials are
collecting data to support submissions to the U.S. Food and Drug
Administration for approvals and to support the clinical
effectiveness of the products.
Professional service costs declined 77% during the six months
ended June 30, 2016. During the six months ended June 30, 2015, the
Company was expending funds for the engineering and design of the
BreathScan Lync(TM) reader and cartridge being used with the new
MPC products. These design projects are now complete.
Significant increase in supplies ($39,237 (2015: $27,831)),
travel expense ($11,047 (2015: $32)) and seminars and professional
development ($22,160 (2015: $-)) was offset by a reduction in the
utilization of inventory resources for development and testing
($2,937 (2015: $25,537)) that resulted in an increase of 31% for
other research and development costs during the six months ended
June 30, 2016.
The following table illustrates research and development costs
by project for the six months ended June 30, 2016 and 2015,
respectively:
Project 2016 2015
------------------------- -------- --------
Asthma/pH $ - $ 4,917
Breath Alcohol 1,381 46,626
Chlamydia Trachomatis 10,685 79,860
CHUBE - 397
Heparin/PF4 72,575 43,514
HIV - 58,718
Ketone 2,125 45,922
KetoChek / OxiChek 365,178 -
Lithium - 40,638
METRON 2,507 61,299
Other Projects 101,584 74,301
Pulmo Health 6,126 -
Sonicator OQ - 886
Troponin (heart attacks) - 104,592
Tri-Cholesterol 117,903 64,890
VIVO 5,216 57,239
------- -------
Total R&D Expenses: $685,280 $683,799
------- -------
Other Income and Expense
Other income, net of expenses for the six months ended June 30,
2016 totaled $13,899, which was an 80% decrease as compared to
$69,209 for the six months ended June 30, 2015.
The table below summarizes our other income and expenses for the
six months ended June 30, 2016 and 2015 as well as the percentage
of change year-over-year:
6 Months 6 Months
Ended Ended
Description June 30, 2016 June 30, 2015 Percent Change
--------------------------------------- ---------------- ---------------- --------------
Currency Translation Loss $ (4,817) $ (5,969) (19)%
Realized Gains/(Losses) on Investments 2,152 (1,988) (208)%
Interest and Dividends 16,564 71,157 (77)%
Other Income - 6,010 (100)%
------------ ------------
Total Other Income, Net of Expenses $ 13,899 $ 69,210 (80)%
------------ ------------
Losses associated with foreign currency transactions improved by
19% during the six months ended June 30, 2016 as compared to the
same period of 2015, primarily a result of improved exchange rates
between the US Dollar, the Euro and the British Pound.
Other income and expenses primarily consist of realized gains on
investments totaling $2,152 (2015: loss of $1,988) and interest and
dividend earnings on the marketable securities and the note
receivable totaling $16,564 (2015: $71,157).
Income Taxes
As of June 30, 2016, the Company does not believe any uncertain
tax positions exist that would result in the Company having a
liability to the taxing authorities. The Company's policy is to
classify interest and penalties related to unrecognized tax
benefits, if and when required, as part of interest expense and
general and administrative expense, respectively in the
consolidated statement of operations.
Liquidity and Capital Resources
For the six months ended June 30, 2016 and 2015, the Company
generated a net loss attributable to shareholders of $2,517,861 and
$3,408,028, respectively. As of June 30, 2016 and December 31,
2015, the Company has an accumulated deficit of $96,693,860 and
$94,175,999 and had cash and marketable securities totaling
$1,927,560 and $4,427,163, respectively.
Currently, our primary focus is to expand the domestic and
international distribution of our PIFA Heparin/PF4 rapid assays.
The Company's secondary focus is fully commercializing the health
and wellness product line linked to smartphones and tablets. The
Company continues commercialization tasks for METRON as well as
development activities for its PIFA PLUSS(R) Infectious Disease
single-use assays, BreathScan(R) DKA, and Breath PulmoHealth
products, including advancement of the steps required for FDA
clearance or CE marking in the EU where necessary.
We expect to continue to incur losses from operations for the
near-term and these losses could be significant as we incur product
development, clinical and regulatory activities, contract
consulting and other product development and commercialization
related expenses. We believe that our current working capital
position will be sufficient to meet our estimated cash needs for at
least twelve months. We are closely monitoring our cash balances,
cash needs and expense levels. The accompanying financial
statements do not include any adjustments to reflect the possible
future effects on the recoverability and classification of assets
or the amounts and classification of liabilities that might result
in the possible inability of the Company to continue as a going
concern.
We expect that our primary expenditures will be to continue
development of additional health and wellness products, PIFA
PLUSS(R) Infectious Disease single-use assays, BreathScan(R) DKA
and Breath PulmoHealth products, enrolling patients in clinical
trials to support performance claims, generating studies in
peer-reviewed journals to support product marketing, and provide
data for the FDA 510(k) clearance/CE certifications processes when
required. We will also continue to support commercialization and
marketing activities of commercialized products (PIFA Heparin/PF4
rapid assays, PIFA PLUSS(R) PF4, breath alcohol detectors and
METRON in the US and internationally. Based upon our experience,
clinical trial and related regulatory expenses can be significant
costs. Steps to achieve commercialization of emerging products will
be an ongoing and evolving process with expected improvements and
possible subsequent generations being evaluated for commercialized
and emerging tests. Should we be unable to achieve FDA clearance
for products that require such regulatory "approval", develop
performance characteristics for rapid tests that satisfy market
needs, or generate sufficient revenue from commercialized products,
we would need to rely on other business or product opportunities to
generate revenue and costs that we have incurred for the patents
may be deemed impaired.
Capital expenditures for the six months ended June 30, 2016 were
$81,462 (2015: $44,509). Capital expenditures, primarily for
production, laboratory and facility improvement costs for the year
ending December 31, 2016 are expected to be approximately $200,000.
As per the Company's lease agreement, the owner of the facility
will be handling the majority of facility upgrades, and we
anticipate financing any production and laboratory capital
expenditures through working capital.
During the six months ended June 30, 2015, the Company invested
$64,091 for a 19.9% ownership position in a joint venture with
Hainan Savy Investment Management, Ltd and Mr. Thomas Knox, the
Company's Chairman, to research, develop, produce and sell the
Company's rapid diagnostic screening and testing products in China.
The new entity, incorporated in the People's Republic of China,
operates as Hainan Savy Akers Biosciences, Ltd.
The Company may enter into generally short-term consulting and
development agreements primarily for testing services and in
connection with clinical trials conducted as part of the Company's
development process which may include activities related to the
development of technical files for FDA 510(k) clearance
submissions. Such commitments at any point in time may be
significant but the agreements typically contain cancellation
provisions.
We lease our manufacturing facility which also contains our
administrative offices. Our current lease was executed January 1,
2013 and is effective through December 31, 2019. The Company has
leased this property from the current owner since 1997.
Management continues to place increased emphasis on monitoring
the risks associated with the current environment, particularly the
recoverability of current assets, the fair value of assets, and the
Company's liquidity. At this point in time, there has not been a
material impact on the Company's assets and liquidity. Management
will continue to monitor the risks associated with the current
environment and their impact on the Company's results.
The table below summarizes our cash flows for the six months
ended June 30, 2016 and 2015 as well as the percentage of change
year-over-year:
6 Months 6 Months
Ended Ended
Description June 30, 2016 June 30, 2015 Percent Change
-------------------------------------------- ---------------- ---------------- --------------
Cash at beginning of period $ 402,059 $ 455,841 (12)%
Loss from operations (2,517,861) (3,408,028) (26)%
Adjustments
Non-Operating Gains - (6,010) (100)%
Non-Cash Activities 295,513 1,025,154 (71)%
Cash Used in Operating Activities
Cash Consumed by Operating Activities (268,523) (1,121,021) (76)%
Cash Contributed by Operating Activities 75,129 546,121 (86)%
Cash Flows from Investing Activities
Cash Consumed by Investing Activities (109,105) (143,155) (24)%
Cash Contributed by Investing Activities 2,502,319 2,912,332 (14)%
Cash Flows from Financing Activities
Cash Consumed by Financing Activities - - -%
Cash Contributed by Financing Activities - - -%
------------ ------------
Cash at end of period $ 379,531 $ 261,234 45%
------------ ------------
The Company's net cash provided by investing and financing
activities totaled $2,393,214 during the six months ended June 30,
2016. Cash of $109,105 was consumed by capital expenditures and the
purchase of marketable securities. Proceeds from the sale of
marketable securities contributed cash of $2,502,319 for the period
ended June 30, 2016.
The Company's net cash provided by investing and financing
activities totaled $2,769,177 during the six months ended June 30,
2015. Cash of $143,155 was consumed by capital expenditures, the
investment in Hainan Savy Akers Biosciences, Ltd. and the purchase
of marketable securities. Proceeds from the sale of marketable
securities and a policy renewal incentive from an insurer
contributed cash of $2,912,332 for the period ended June 30,
2015.
Our net cash consumed by operating activities totaled $2,415,742
during the six months ended June 30, 2016. Cash was consumed by the
loss of $2,517,861 plus non-cash adjustments of $113,906 for
depreciation and amortization of non-current assets, $146,196 for
allowances for doubtful accounts, $18,243 for share based
compensation, $8,241 for options issued for services and $8,927 for
accrued income on marketable securities. For the six months ended
June 30, 2016, decreases in deposits and other receivables of
$31,196 and prepaid expenses of $43,933 provided cash, primarily
related to routine changes in operating activities. A net increase
in trade receivables of $79,906 and inventories of $85,588 and a
decrease in trade and other payables of $103,029 consumed cash from
operating activities.
Akers Bio's net cash consumed by operating activities totaled
$2,963,784 during the six months ended June 30, 2015. Cash was
consumed by the loss of $3,408,028 less non-operating gains of
$6,010 plus non-cash adjustments of $160,931 for depreciation and
amortization of non-current assets, $864,000 for allowances for
doubtful accounts and $223 for accrued income on marketable
securities. For the six months ended June 30, 2015, decreases in
notes receivable - related party of $131,566, deposits and other
receivables of $7,578, inventory of $83,128 and an increase in
trade and other payables of $323,849 provided cash while a net
increase in trade receivables of $747,629 and prepaid expenses of
$67,836 and a decrease in deferred revenue - related party of
$305,556 consumed cash from operating activities.
Financial statements
Condensed Consolidated Balance Sheets
June 30, 2016 and December 31, 2015
2016 2015
------------ ------------
(unaudited) (audited)
ASSETS
Current Assets
Cash $ 379,531 $ 402,059
Marketable Securities 1,548,029 4,025,104
Trade Receivables, net 542,525 609,195
Trade Receivables - Related Party, net 31,892 31,512
Deposits and other receivables 64,381 95,577
Inventories, net 1,217,242 1,131,654
Prepaid expenses 142,034 185,967
----------- -----------
Total Current Assets 3,925,634 6,481,068
----------- -----------
Non-Current Assets
Property, Plant and Equipment, net 304,255 251,145
Intangible Assets, net 1,387,329 1,472,883
Other Assets 66,813 66,813
----------- -----------
Total Non-Current Assets 1,758,397 1,790,841
----------- -----------
Total Assets $ 5,684,031 $ 8,271,909
=========== ===========
LIABILITIES
Current Liabilities
Trade and Other Payables $ 1,565,702 $ 1,668,731
----------- -----------
Total Current Liabilities 1,565,702 1,668,731
----------- -----------
Total Liabilities 1,565,702 1,668,731
----------- -----------
STOCKHOLDERS' EQUITY
Convertible Preferred Stock, No par value, 50,000,000 shares authorized,
no shares issued
and outstanding as of June 30, 2016 and December 31, 2015 - -
Common Stock, No par value, 500,000,000 shares authorized, 5,452,545 and
5,425,045 issued
and outstanding as of June 30, 2016 and December 31, 2015 100,848,374 100,785,408
Deferred Compensation (36,482) -
Accumulated Deficit (96,693,860) (94,175,999)
Accumulated Other Comprehensive Income/(Loss) 297 (6,231)
----------- -----------
Total Stockholders' Equity 4,118,329 6,603,178
----------- -----------
Total Liabilities and Stockholders' Equity $ 5,684,031 $ 8,271,909
=========== ===========
Condensed Consolidated Statements of Operations and
Comprehensive Income (unaudited)
Three months ended Six months ended
------------------------- -------------------------
2016 2015 2016 2015
----------- ----------- ----------- -----------
Revenues:
Product Revenue $ 956,486 $ 744,700 $ 1,694,510 $ 1,142,071
Product Revenue - Related party - - - 14,343
License Revenue - 10,000 - 15,000
License Revenue - Related party - 212,222 - 305,556
---------- ---------- ---------- ----------
Total Revenues 956,486 966,922 1,694,510 1,476,970
Cost of Sales:
Product Cost of Sales (276,848) (341,025) (476,876) (567,367)
---------- ---------- ---------- ----------
Gross Profit 679,638 625,897 1,217,634 909,603
Administrative Expenses 816,244 882,531 1,739,806 1,580,964
Administrative Expenses - Related
parties - 864,000 - 864,000
Sales and Marketing Expenses 513,430 553,539 1,238,754 1,128,792
Research and Development Expenses 321,989 378,225 685,280 683,799
Amortization of Non-Current Assets 42,777 64,643 85,554 129,286
---------- ---------- ---------- ----------
Loss from Operations (1,014,802) (2,117,041) (2,531,760) (3,477,238)
---------- ---------- ---------- ----------
Other (Income)/Expenses
Foreign Currency Transaction Loss 2,562 6,965 4,817 5,969
Interest and Dividend Income (8,432) (37,122) (18,716) (69,169)
Other Income - (655) - (6,010)
---------- ---------- ---------- ----------
Total Other Income (5,870) (30,812) (13,899) (69,210)
---------- ---------- ---------- ----------
Loss Before Income Taxes (1,008,932) (2,086,229) (2,517,861) (3,408,028)
Income Tax Benefit - - - -
---------- ---------- ---------- ----------
Net Loss Attributable to Common
Stockholders (1,008,932) (2,086,229) (2,517,861) (3,408,028)
---------- ---------- ---------- ----------
Other Comprehensive Income
Net Unrealized (Losses)/Gains on
Marketable Securities (2,006) (3,559) 6,528 23,155
---------- ---------- ---------- ----------
Total Other Comprehensive
(Loss)/Income (2,006) (3,559) 6,528 23,155
---------- ---------- ---------- ----------
Comprehensive Loss $(1,010,938) $(2,089,788) $(2,511,333) $(3,384,873)
========== ========== ========== ==========
Basic & diluted loss per common share $ (0.19) $ (0.41) $ (0.46) $ (0.66)
========== ========== ========== ==========
Weighted average basic & diluted
common shares outstanding 5,427,261 5,144,837 5,426,153 5,135,389
========== ========== ========== ==========
Condensed Consolidated Statement of Changes in Stockholder's
Equity
For six months ended June 30, 2016
Common Accumulated
Shares Other
Issued and Common Deferred Accumulated Comprehensive Total
Outstanding Stock Compensation Deficit Income/(Loss) Equity
------------ ---------------- -------------- ---------------- --------------- ---------------
Balance at
December 31, 2015
(audited) 5,425,045 $ 100,785,408 $ - $ (94,175,999) $ (6,231) $ 6,603,178
Net loss for
the period - - - (2,517,861) - (2,517,861)
Issuance of
Restricted
Stock to
Officers 27,500 54,725 (54,725) - - -
Amortization of
deferred
compensation - - 18,243 - - 18,243
Options issued
for services - 8,241 - - - 8,241
Net unrealized
gain on
marketable
securities - - - - 6,528 6,528
----------- --- ----------- ---- -------- --- ----------- ---- --------- --- ----------
Balance at June
30, 2016
(unaudited) 5,452,545 $ 100,848,374 $ (36,482) $ (96,693,860) $ 297 $ 4,118,329
=========== === =========== ==== ======== === =========== ==== ========= === ==========
Condensed Consolidated Statements of Cash Flows
For six months ended June 30, 2016 and 2015 (unaudited)
2016 2015
----------- -----------
Cash flows from operating activities
Net loss for the period $(2,517,861) $(3,408,028)
Adjustments to reconcile net loss to net cash used in operating
activities:
Accrued income on marketable securities 8,927 223
Depreciation and amortization 113,906 160,931
Allowance for doubtful accounts 146,196 864,000
Gain from other non-operating activities - (6,010)
Non-cash share based compensation - restricted stock 18,243 -
Non-cash share based payments for services - options 8,241 -
Changes in assets and liabilities:
Increase in trade receivables (79,906) (747,629)
Decrease in notes receivables - related party - 131,566
Decrease in deposits and other receivables 31,196 7,578
Decrease/(increase) in inventories (85,588) 83,128
Decrease/(increase) in prepaid expenses 43,933 (67,836)
Increase/(decrease) in trade and other payables (103,029) 323,849
Decrease in deferred revenue - related party - (305,556)
---------- ----------
Net cash used in operating activities (2,415,742) (2,963,784)
---------- ----------
Cash flows from investing activities
Purchases of property, plant and equipment (81,462) (44,509)
Purchases of marketable securities (27,643) (34,555)
Investment in Hainan Savy Akers Biosciences, Ltd. joint venture - (64,091)
Proceeds from other non-operating activities - 6,010
Proceeds from sale of marketable securities 2,502,319 2,906,322
---------- ----------
Net cash provided by investing activities 2,393,214 2,769,177
---------- ----------
Net decrease in cash (22,528) (194,607)
Cash at beginning of period 402,059 455,841
---------- ----------
Cash at end of period $ 379,531 $ 261,234
========== ==========
Supplemental Schedule of Non-Cash Financing and Investing Activities
Issuance of a restricted common stock grant to an officer $ 54,725 $ -
========== ==========
Net unrealized gains on marketable securities $ 6,528 $ 23,155
========== ==========
Issuance of restricted common share grants to directors and officers
accrued in 2014 $ - $ 697,300
========== ==========
Cautionary Statement Regarding Forward Looking Statements
Statements contained herein that are not based upon current or
historical fact are forward-looking in nature and constitute
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. Such forward-looking statements reflect the Company's
expectations about its future operating results, performance and
opportunities that involve substantial risks and uncertainties.
These statements include but are not limited to statements
regarding the intended terms of the offering, closing of the
offering and use of any proceeds from the offering. When used
herein, the words "anticipate," "believe," "estimate," "upcoming,"
"plan," "target", "intend" and "expect" and similar expressions, as
they relate to Akers Biosciences, Inc., its subsidiaries, or its
management, are intended to identify such forward-looking
statements. These forward-looking statements are based on
information currently available to the Company and are subject to a
number of risks, uncertainties, and other factors that could cause
the Company's actual results, performance, prospects, and
opportunities to differ materially from those expressed in, or
implied by, these forward-looking statements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DGGDIDUBBGLG
(END) Dow Jones Newswires
August 11, 2016 02:01 ET (06:01 GMT)
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