Technology News Alert: Champions Oncology, Inc. (Nasdaq: CSBR)

Champions Oncology, Inc. (Nasdaq: CSBR), dedicated to the development of advanced technology solutions and services to personalize the development and use of oncological drugs, recently declared its financial results for the fiscal second quarter and six months ended October 31, 2017.

Technology News Alert: Champions Oncology, Inc. (Nasdaq: CSBR)

 

Highlights of the Second Quarter and Recent Business:

  • Quarterly earnings record of $ 5.20 million, an increase of 16.7% year after year
  • Revenue from translational oncology services of $ 4.8M, a 21.8 percent increase from one year to the next

A two-year, $ 2M contract was awarded through the Small Business Innovation Research (SBIR) program to build and study an ethnically diverse cohort of metastatic prostate xenograft (PDX) models.

Clinical correlation between the responses of the patient derived xenograft model (PDX) and the patients’ responses to the oncology therapies highlighted in the journal, Annals of Oncology;

The report was published by the European Society of Medical Oncology (ESMO), the leading European professional organization for medical oncology in Europe.

They reiterated expectations for revenue growth for fiscal year 2018 of at least 20 percent during fiscal year 2017.
Financial results

For the second quarter of fiscal year 2018, revenues increased 16.7 percent to $ 5.2 million, in contrast to $ 4.5 million for the second quarter of fiscal year 2017.

Total operating expenses for the second fiscal quarter 2018 and 2017 were $ 5.3 million and $ 5 million. respectively, an increase of $ 300,000 or 6.5 percent.

Revenues were $ 10.2M and $ 8.1M for the six months ended October 31, 2017 and 2016, respectively, an increase of $ 2.1M or 26%. Total operating expenses for the six months ended October 31, 2017 and 2016 were $ 10.9M and $ 11.1M, respectively, a decrease of $ 200,000 or (2 percent).

 

 

Financial Results

 

For the second quarter of fiscal year 2018, the champions declared a loss of operations of $ 70,000, counting $ 148,000 in stock-based compensation, an improvement of $ 423,000 or 85.8 percent in contrast to the loss of operations of $ 493,000, including $ 535,000 in stock-based compensation,

In the second quarter of fiscal year 2017. Aside from stock-based compensation and depreciation, the Champions recognized net operating income of $ 175,000 for the second quarter of 2018.

 

Net cash generated was $ 229,000 for the 3 months ended October 31, 2017. Net cash used for the same period last year was $ 134,000. The improvement in cash flow is the result of revenue growth and expense management.

The Company ended the quarter with $ 660,000 in cash and cash equivalents and reiterates its position that it currently does not intend to raise capital in the stock market.

TOS income was $ 4.8M for the 3 months ended October 31, 2017, in contrast to $ 4M for the 3 months ended October 31, 2016, an increase of $ 800,000 or 21.8 percent.

Cost of sales of TOS was $ 2.4M for the 3 months ended October 31, 2017, an increase of $ 600,000, or 30.9 percent, in contrast to $ 1.8M for the 3 months ended October 31, 2016. For the 3 months ended October 31, 2017 and 2016, the gross margin for TOS was 50.4 percent and 53.8 percent, respectively.

The increase in cost of sales TOS was due to an increase in the number and size of the TOS studies. Gross margin often fluctuates quarter by quarter, as a result of temporary differences between the recognition of income and expenses.

Revenue from Personalized Oncology Services was $ 378,000 and $ 497,000 for the 3 months ended October 31, 2017 and 2016, respectively, a decrease of $ 119,000 or (23.9 percent).

The decrease is mainly due to a decrease in income from implant and medication studies.

The cost of selling POS was $ 259,000 for the 3 months ended October 31, 2017, a decrease of $ 115,000 or 30.7 percent, in contrast to $ 374,000 for the 3 months ended October 31, 2016. For For the 3 months ended October 31, 2017 and 2016, the gross margin for POS was 31.5 percent and 24.8 percent, respectively.

The improvement is attributed to the increase in revenues due to the higher margin sequence.

Research and development expenses were $ 1.1M for the 3 months ended October 31, 2017, an increase of $ 100,000, or 10.6 percent, in contrast to $ 1M for the 3 months ended October 31, 2016 Selling and marketing expenses for the 3 months ended October 31, 2017 was $ 551,000, a decrease of $ 166,000 or 23.2 percent, in contrast to $ 717,000 for the 3 months ended October 31, 2016.

The decrease is mainly due to a reduction in marketing resources for the POS division. General and administrative expenses were $ 1 million for the 3 months ended October 31, 2017 and 2016.

 

Financial results for the year to date

 

During the first six months of fiscal year 2018, revenues increased 26.0 percent to $ 10.2 million, in contrast to $ 8.1 million in the first six months of fiscal year 2017.

Total operating expenses for the first six months of fiscal year 2018 were $ 10.9 million versus $ 11.1 million. the first six months of fiscal year 2017, a decrease of $ 200,000 or (1.9 percent).

During the first six months of fiscal year 2018, Champions declared a loss of $ 689,000 in operations, including $ 711,000 and $ 132,000 in stock-based compensation and depreciation, respectively, an improvement of $ 2.3M, or 77.2 percent, in contrast to the loss of $ 3M operations, including $ 1.7M and $ 87,000 in compensation and depreciation based on shares, respectively, in the first six months of fiscal year 2017.

Apart from the compensation and share-based depreciation, the champions recognized operating income of $ 155,000 for the six months ended October 31, 2017 in contrast to a net loss of $ 1.3M for the six months ended October 31, 2016.

TOS revenues were $ 9.4M for the six months ended October 31, 2017, in contrast to $ 7.1M for the six months ended October 31, 2016, an increase of $ 2.3M or 32.3 percent.

Cost of sales of TOS was $ 4.6M for the six months ended October 31, 2017, an increase of $ 700,000, or 19.8 percent, in contrast to $ 3.9M for the six months ended October 31, 2016.

The gross margin for TOS was 50.7 percent for the first six months of fiscal year 2018, contrasting with 45.5 percent in the first six months of fiscal year 2017.

POS revenues were $ 818,000 for the six months ended October 31, 2017, in contrast to $ 1.0M for the six months ended October 31, 2016, a decrease of $ 182,000 or (18.8 percent).

 

Technology News Alert: Champions Oncology, Inc. (Nasdaq: CSBR)

 

The cost of selling POS was $ 646,000 for the six months ended October 31, 2017, a decrease of $ 201,000 or 23.7 percent, in contrast to $ 847,000 for the six months ended October 31, 2016.

Margin Gross POS for the six months ended October 31, 2017 was a 21 percent contrast to 15.9 percent for the six months ended October 31, 2016.

Research and development expenses were $ 2.2 million for both the six months ended October 31, 2017 and 2016. Selling and marketing expenses for the six months ended October 31, 2017 were $ 1.2 million, a decrease of $ 400,000 or 24.8 percent. $ 1.6M for the six months ended October 31, 2016.

General and administrative expenses were $ 2.2M for the six months ended October 31, 2017, a decrease of $ 400,000 or (15.3 percent), in contrast to $ 2.6M for the six months ended October 31, 2016.

The net cash used in the operations was $ 1.7 million for the six months ended October 31, 2017, in contrast to $ 2.6 million for the six months ended in 2016, a decrease of $ 900,000 or 34.3 percent.

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