Rockwell Medical(US:RMTI)2022-08-15 21:13Financial Performance - Net sales for the three months ended June 30, 2022, were $18.682 million, a 23.5% increase compared to $15.137 million for the same period in 2021[13] - Gross profit for the six months ended June 30, 2022, was $960 thousand, compared to a gross profit of $140 thousand for the same period in 2021, indicating a significant improvement[13] - The company reported a net loss of $4.967 million for the three months ended June 30, 2022, compared to a net loss of $8.400 million for the same period in 2021, reflecting a reduction in losses of 40.5%[13] - For the six months ended June 30, 2022, the net loss was approximately $12.1 million, compared to a net loss of $16.2 million for the same period in 2021, representing a 25.1% improvement[22] - Basic and diluted net loss per share improved to $(0.56) for the three months ended June 30, 2022, compared to $(0.99) for the same period in 2021[13] - The operating loss for the six months ended June 30, 2022, was $11.1 million, an improvement from an operating loss of $15.0 million in the same period of 2021[13] Assets and Liabilities - Total assets increased to $59.116 million as of June 30, 2022, up from $48.574 million as of December 31, 2021, representing a growth of 21.1%[11] - Total liabilities decreased to $38.971 million as of June 30, 2022, from $46.039 million as of December 31, 2021, a decline of 15.3%[11] - Stockholders' equity increased significantly to $20.145 million as of June 30, 2022, compared to $2.535 million as of December 31, 2021, marking an increase of 691.5%[11] - Cash and cash equivalents rose to $30.780 million as of June 30, 2022, compared to $13.280 million as of December 31, 2021, an increase of 131.1%[11] - As of June 30, 2022, the company had approximately $30.8 million in cash and cash equivalents and working capital of $28.7 million[31] Revenue Recognition - The Company recognizes revenue under ASC 606, with revenue from product sales allocated based on stand-alone selling prices[60][63] - Revenue is recognized at the shipping point for the majority of international customers, with payment terms averaging 30 days for customers and 45 days for distributors[66] - Total net revenue for the three months ended June 30, 2022, was $18.682 million, an increase from $15.137 million in the same period of 2021, representing a growth of 23.5%[69] - Drug product sales for the three months ended June 30, 2022, totaled $547,000, compared to $273,000 for the same period in 2021, marking a 100.7% increase[69] - Concentrate product sales for the three months ended June 30, 2022, were $18.135 million, up from $14.864 million in the same period of 2021, reflecting a growth of 21.5%[69] Capital and Financing - The company issued 15,000 shares of preferred stock, raising $14.916 million net of offering costs[17] - The company entered into a sales agreement to offer and sell up to $12.2 million of common stock, with $15.1 million raised from the sale of 7,500 shares at an average price of approximately $2.02[34] - The Company expects to require additional capital to sustain operations and execute its strategic plan for developing FPC for iron deficiency anemia and progressing its pipeline development program[37] - The Company's public float is currently less than $75 million, subjecting it to baby shelf limitations that could restrict its ability to raise capital[38] - The Company received a Notification Letter from Nasdaq indicating non-compliance with the minimum bid price requirement of $1.00 per share for continued listing, which was not met by the deadline of December 8, 2021[39][40] Operational Efficiency - Research and product development expenses decreased to $926 thousand for the three months ended June 30, 2022, down from $2.416 million in the same period of 2021, a reduction of 61.7%[13] - Cash used in operating activities for the six months ended June 30, 2022, was approximately $15.7 million, a decrease from $17.4 million in the prior year[22] - The company reported an increase in accounts receivable of $2.2 million and an increase in inventory of $1.1 million for the six months ended June 30, 2022[22] - The company recognized total stock-based compensation expense of $98,000 for the three months ended June 30, 2022, compared to $433,000 for the same period in 2021[105] Market Position and Strategy - The company is well-positioned for sustainable growth, focusing on providing life-sustaining products for patients with blood disorders and kidney diseases[28] - Rockwell Medical is the second largest supplier of acid and bicarbonate concentrates for dialysis patients in the United States, highlighting its significant market position[24] - The company is developing a next-generation proprietary parenteral iron technology platform, Ferric Pyrophosphate Citrate, aimed at treating iron-deficiency anemia[27] Impact of External Factors - The COVID-19 pandemic has adversely affected the Company's business operations, including sales, marketing, and research and development activities[43] - Current financial and credit market conditions may limit the availability of funding or increase the cost of funding for the Company[44]