CytoSorbents(US:CTSO)2024-11-07 21:33Revenue and Sales Performance - Total revenues for Q3 2024 were $9.39 million, a 7% increase compared to $8.81 million in Q3 2023[123] - Product sales increased by 11% to $8.61 million in Q3 2024, driven by a 21% increase in direct sales[123] - Total revenues increased by 5% to $29,071,000 for the nine months ended September 30, 2024, with product sales up 11% to $26,444,000, driven by a 16% increase in distributor sales and an 8% increase in direct sales[133] Grant Income - Grant income decreased by 26% to $777,000 in Q3 2024 due to the completion of several grants in 2023[124] - Grant income decreased by 33% to $2,627,000 for the nine months ended September 30, 2024, due to the completion of several grants in 2023[134] Gross Profit and Margins - Gross profit decreased to $5.28 million in Q3 2024 from $5.61 million in Q3 2023, with product gross margins dropping to 61% from 72%[126] - Gross profit increased by $1,274,000 to $18,355,000 for the nine months ended September 30, 2024, despite a temporary production slowdown and manufacturing issues that reduced CytoSorb device output[135] - Inflationary pressures have increased labor and raw material costs, impacting product gross margins[122] Research and Development Expenses - Research and development expenses decreased by 51% to $1.85 million in Q3 2024, primarily due to the completion of the STAR-T clinical trial[127] - Research and development expenses decreased by 52% to $5,619,000 for the nine months ended September 30, 2024, primarily due to the completion of the STAR-T clinical trial in December 2023[136] Product and Market Performance - CytoSorb® has been used in over 250,000 devices cumulatively and is distributed in 76 countries worldwide[115] - The DrugSorb™-ATR system received FDA Breakthrough Device Designations and a De Novo application was submitted in September 2024[116] - The STAR-T clinical trial demonstrated reduced perioperative bleeding in CABG surgery patients, representing over 90% of the study population[119] Government-Funded Projects - The company has ongoing government-funded projects totaling $15.8 million, $4.7 million, and $7.7 million for HemoDefend-BGA™, HemoDefend-RBC™, and K+ontrol™, respectively[121] Selling, General, and Administrative Expenses - Selling, general and administrative expenses decreased by $1,101,000 (14%) to $7,003,000 for the three months ended September 30, 2024, primarily due to reductions in non-cash stock compensation, salaries, and royalty expenses[129] Interest Expense and Debt - Interest expense, net increased to $588,000 for the three months ended September 30, 2024, compared to $34,000 in the same period in 2023, driven by new debt from Avenue Capital Group with a principal of $15,000,000 and an interest rate of 13.5%[130] - Interest expense, net increased to $775,000 for the nine months ended September 30, 2024, compared to $106,000 in 2023, due to the Avenue Capital Group debt facility[139] - The company closed a $20 million term-loan facility with Avenue Capital Group in June 2024, with $15 million initially disbursed and $5 million contingent on FDA approval of DrugSorb-ATR[143] Foreign Currency Transactions - Gain on foreign currency transactions was $2,650,000 for the three months ended September 30, 2024, compared to a loss of $1,810,000 in 2023, due to the Euro strengthening against the U.S. dollar from $1.07 to $1.11[131] Cash and Liquidity - As of September 30, 2024, the company had $12.2 million in cash, including $5.7 million unrestricted and $6.5 million restricted, with additional funds contingent on achieving milestones related to FDA approval and equity financing[145] - As of September 30, 2024, the company's cash, cash equivalents, and restricted cash balances were approximately $12.2 million, including $5.7 million in cash and cash equivalents and $6.5 million in restricted cash, raising substantial doubt about its ability to continue as a going concern[150] - The company is pursuing milestones related to its Avenue Capital Group debt facility, which could increase its unrestricted cash position by up to $10 million, and is evaluating other capital sources, including debt financing, equity financing, and strategic investments[150] Leasing and Facilities - CytoSorbents Europe GmbH leased an additional 1,068 square meters of warehouse space starting April 1, 2021, with monthly base rent of $7,784 and other costs of approximately $239, for a term of five years with an option to extend for another five years[147] - The company extended two operating leases for its office facility in Germany in September 2021, requiring combined base rent payments of approximately $12,100 per month and monthly operating expenses of approximately $3,000, with a five-year renewal option extending the lease term to August 31, 2031[148]