CAS Medical Systems, Inc. (CAS Medical), patient monitoring and anesthesia and respiratory devices company, has reported revenues of $40.6 million for the full year of 2008, up 6%, compared with the revenues of $38.2 million in the previous year-end. It has also reported net loss of $0.38 million or $0.04 per share, for the full year of 2008, compared with the net income of $0.30 million or $0.03 per share, in the previous year-end.
Key milestones and operational highlights for the year include:
Strengthened company’s financial position through $1 million private placement, debt reduction and extension of line of credit through 2010
Lowered inventory levels by over $1 million in the fourth quarter
Positive cash flow from operations of $1.7 million, in contrast to $3.2 million of cash used by operations in 2007
Increased FORE-SIGHT sales for year to $2.3 million from $0.3 million in 2007 with installed base of 151 monitors at year end
Received FDA 510(k) clearance for FORE-SIGHT Cerebral Oximeter
Neonatal/Infant Sensor Neonatal/Infant FORE-SIGHT product successfully launched with sales to two of the top children’s hospitals in the U.S.
Strengthened sales and marketing organization with the addition of new key hires
Established direct sales team for FORE-SIGHT with 12 sales and clinical representatives
Increased OEM module business 33% over 2007
Financial Results for Q4 2008
Revenues for the fourth quarter ended December 31, 2008 decreased 9 percent, or $881,000, to $9.4 million from sales of $10.3 million reported for the fourth quarter of 2007. Shortfalls in bedside monitoring sales were partially offset by increases in sales of OEM products and FORE-SIGHT cerebral oximeter monitors and sensors.
The company recorded a net loss of $155,000 for the fourth quarter of 2008, or ($0.01) per basic and diluted common share, compared to a net loss of $12,000, or ($0.00) per basic and diluted common share, for the fourth quarter of fiscal 2007. Cash balances increased $0.2 million to $1.1 million at December 31, 2008 and bank debt was reduced by $1.1 million to $4.3 million during the fourth quarter of 2008.
Stock compensation expense was $92,000 for the last three months of 2008, compared to $86,000 for the same period of the prior year.
Commenting on the fourth quarter, Andrew E. Kersey, President and CEO stated, “Our core business remained strong despite the uncertain economic climate facing all companies at this time. As reported at the end of December, our fourth quarter revenues from sales of bedside monitoring products were adversely affected by a slowdown in hospital capital equipment purchases. However, sales of our consumable supplies, including the FORE-SIGHT sensors, continued to trend well during this period.
Areas of our business outside of bedside monitoring combined for a 17% increase in revenue over the fourth quarter of 2007.”
Financial Results for the Full Year of 2008
The increase in revenues was led by sales of OEM modules, consumable supplies and FORE-SIGHT monitors and sensors, partially offset by a reduction in sales of bedside monitors.
S, G&A expenses increased $1.4 million or 12% to $12.2 million, up from $10.8 million in 2007 primarily due to an increase in FORE-SIGHT related sales and marketing expense of $1.4 million.
Stock compensation expense was $410,000 for 2008, compared to $303,000 for the prior year.
During 2008, the company generated cash from operations of $1.7 million, compared to cash used by operations of $3.2 million for 2007. Further, the company repaid bank debt and reduced borrowing against its line of credit by a total of $833,000 during 2008. In addition, during December 2008, the company modified and extended the line of credit with its bank lender through June 2010.
“We are pleased to report record revenue for the twelfth consecutive year,” stated Mr. Kersey. “In 2008 we strengthened our organization and our financial position. Not only did we renew our blanket purchase agreement with the Department of Veterans Affairs for our vital signs monitors through June of 2009, but we also expanded our sales presence in the U.S. by contracting with a national group of manufacturer’s representatives to sell our bedside monitoring products. Additionally, our FORE-SIGHT sales team was expanded to a total of 12 sales and clinical representatives focused exclusively on the FORE-SIGHT opportunity. With these investments, we believe we are well positioned to grow key areas of our existing core business and FORE-SIGHT revenues.”