-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, HhmFLWvmT2685Gp876E4H057loH/0YCK0n3X1QmvNiJ52wCb5uVwwWwoUdLZFCzK W4sY6QIL8phX4HRHqRw6Eg== /in/edgar/work/0001001277-00-000338/0001001277-00-000338.txt : 20001115 0001001277-00-000338.hdr.sgml : 20001115 ACCESSION NUMBER: 0001001277-00-000338 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000930 FILED AS OF DATE: 20001114 FILER: COMPANY DATA: COMPANY CONFORMED NAME: THERMOGENESIS CORP CENTRAL INDEX KEY: 0000811212 STANDARD INDUSTRIAL CLASSIFICATION: [3821 ] IRS NUMBER: 943018487 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 333-72035 FILM NUMBER: 762541 BUSINESS ADDRESS: STREET 1: 3146 GOLD CAMP DRIVE CITY: RANCHO CORDOVA STATE: CA ZIP: 95670 BUSINESS PHONE: 9168585100 MAIL ADDRESS: STREET 1: 3146 GOLD CAMP DRIVE CITY: RANCHO CORDOVA STATE: CA ZIP: 95670 FORMER COMPANY: FORMER CONFORMED NAME: INSTA COOL INC OF NORTH AMERICA DATE OF NAME CHANGE: 19920703 10-Q 1 0001.txt FORM 10-Q U.S. SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 FORM 10-Q X Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 2000. Commission File Number: 0-16375 -------------------------- THERMOGENESIS CORP. ------------------------------------------------------ (Exact name of Registrant as specified in its charter) Delaware 94-3018487 ------------------------ ------------------- (State of Incorporation) (I.R.S. Employer Identification No.) 3146 Gold Camp Drive Rancho Cordova, CA 95670 (916) 858-5100 ---------------------------------------------------- (Address, including zip code, and telephone number, including area code, of principal executive offices) Securities registered pursuant to section 12(b) of the Act: NONE Securities registered pursuant to section 12(g) of the Act: Name of each exchange Title of each class on which registered ------------------------------ ---------------------- Common Stock, $.001 Par Value Nasdaq SmallCap Market Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes |X| No __ The number of shares of the registrant's common stock, $.001 par value, outstanding on October 16, 2000 was 26,522,199. 2 THERMOGENESIS CORP. INDEX Page Number Part I Financial Information Item 1. Financial Statements (Unaudited): Balance Sheets at September 30, 2000 and June 30, 2000 ...............3 Statements of Operations for the Three Months ended September 30, 2000 and 1999 ....................................5 Statements of Cash Flows for the Three Months ended September 30, 2000 and 1999 ....................................6 Notes to Financial Statements ........................................7 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations .........................8 Item 3. Quantitative and Qualitative Disclosures About Market Risk. See Management's Discussion and Analysis of Financial Condition and Results of Operations. Part II Other Information Item 1. Legal proceedings ....................................................11 Item 2. Changes in Securities ................................................11 Item 3. Default Upon Senior Securities .......................................11 Item 4. Submission of Matters to a Vote of Security Holders ..................11 Item 5. Other Information ....................................................11 Item 6. Ehibits and Reports on Form 8-K ......................................11 Signatures ...................................................................12 3 PART I FINANCIAL INFORMATION THERMOGENESIS CORP. Balance Sheets (Unaudited) September 30, June 30, ASSETS 2000 2000 ------------ ---------- Current Assets: Cash and cash equivalents $ 1,352,000 $ 810,000 Short term investments 210,000 1,740,000 Accounts receivable, net of allowance for doubtful accounts of $84,000 ($84,000 at June 30, 2000) 668,000 627,000 Inventory 2,271,000 2,275,000 Other current assets 102,000 150,000 ------------ ---------- Total current assets 4,603,000 5,602,000 Equipment, at cost less accumulated depreciation of $1,632,000 ($1,506,000 at June 30, 2000) 1,036,000 1,080,000 Other assets 52,000 53,000 ------------ ---------- $ 5,691,000 $6,735,000 ============ ========== See accompanying notes. 4 THERMOGENESIS CORP. Balance Sheets (continued) (Unaudited) September 30, June 30, LIABILITIES AND SHAREHOLDER'S EQUITY 2000 2000 -------------- -------------- Current liabilities: Accounts payable $ 568,000 $ 512,000 Accrued payroll and related expenses 213,000 132,000 Accrued liabilities 314,000 345,000 -------------- -------------- Total current liabilities 1,095,000 989,000 Long-term portion of capital lease obligations 54,000 54,000 Commitments and contingencies Shareholders' equity: Series B convertible preferred stock, $0.001 par value, 4,080 shares authorized; 1,727 issued and outstanding (4,040 at -- -- June 30, 2000) Series A convertible preferred stock, $0.001 par value, 1,200,000 shares authorized; 158,000 issued and outstanding (166,000 at June 30, 2000) -- -- Preferred stock, $0.001 par value; 795,920 shares authorized; no shares issued and outstanding -- -- Common stock, $0.001 par value; 50,000,000 shares authorized; 26,409,763 issued and outstanding (24,804,056 at June 30, 2000) 27,000 26,000 Paid in capital in excess of par 43,277,000 43,005,000 Accumulated deficit (38,762,000) (37,339,000) -------------- -------------- Total shareholders' equity 4,542,000 5,692,000 -------------- -------------- $ 5,691,000 $ 6,735,000 ============== ==============
See accompanying notes. 5 THERMOGENESIS CORP. Statements of Operations (Unaudited) Three Months Ended September 30, 2000 1999 ------------- -------------- Net revenues $ 801,000 $ 999,000 Cost of revenues 926,000 1,251,000 ------------- -------------- Gross loss (125,000) (252,000) ------------- -------------- Expenses: General and administrative 415,000 503,000 Selling and service 478,000 564,000 Research and development 435,000 443,000 Interest 3,000 5,000 ------------- -------------- Total expenses 1,331,000 1,515,000 Interest income 33,000 15,000 ------------- -------------- Net loss ($1,423,000) ($1,752,000) ============= ============== Per share data: Net loss ($1,423,000) ($1,752,000) Preferred stock dividend 50,000 -- ------------- ------------ Net loss to common stockholders ($1,473,000) ($1,752,000) ============= ============== Basic and diluted net loss per share ($0.06) ($0.08) ============= ============== Shares used in computing per share data 25,448,760 20,804,942 ============= ==============
See accompanying notes. 6 THERMOGENESIS CORP. Statements of Cash Flows Three Months Ended September 30, 2000 and 1999 Cash flows from operating activities: 2000 1999 ------------- ------------- Net loss ($1,423,000) ($1,752,000) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation and amortization 181,000 150,000 Amortization of stock and options issued for services -- 22,000 Net change in operating assets and liabilities: Accounts receivable (41,000) 174,000 Inventory 4,000 13,000 Other current assets 48,000 3,000 Other assets (54,000) 91,000 Accounts payable 56,000 270,000 Accrued payroll and related expenses 81,000 (33,000) Accrued liabilities (29,000) (208,000) ------------- ------------- Net cash used in operating activities (1,177,000) (1,270,000) ------------- ------------- Cash flows from investing activities: Capital expenditures (82,000) (90,000) Sales of short-term investments 1,530,000 -- ------------- ------------- Net cash provided by (used in) investing activities 1,448,000 (90,000) ------------- ------------- Cash flows from financing activities: Exercise of stock options and warrants 273,000 -- Payments on capital lease obligations (2,000) -- ------------- ------------- Net cash provided by financing activities 271,000 -- ------------- ------------- Net increase (decrease) in cash and cash equivalents 542,000 (1,360,000) Cash and cash equivalents at beginning of period 810,000 2,327,000 ------------- ------------- Cash and cash equivalents at end of period $ 1,352,000 $ 967,000 ============= =============
See accompanying notes. 7 THERMOGENESIS CORP. Notes to Financial Statements September 30, 2000 (Unaudited) 1. Interim Reporting The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. All sales, domestic and foreign, are made in U.S. dollars and therefore currency fluctuations are believed to have no impact on the Company's net revenues. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three month period ended September 30, 2000 are not necessarily indicative of the results that may be expected for the year ended June 30, 2001. Summary of Significant Accounting Policies On December 3, 1999, the SEC staff issued Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition." The Company is currently assessing the impact, if any, that the SAB will have on its revenue recognition policy. The Company's existing revenue recognition policy is to recognize revenue at the time the customer takes title to the product, generally at the time of shipment. The effect of the change, if any, must be recognized as a cumulative effect of a change in accounting no later than the quarter ending June 30, 2001. At the current time, it is not possible to determine the effect this change will have on the results of operations of the Company. In June 1998, the Financial Accounting Standards Board issued Statement No. 133 ("FAS 133"), Accounting for Derivative Instruments and Hedging Activities, as amended, which became effective for the Company for the quarter ended September 30, 2000. Because of the Company's minimal use of derivatives, FAS 133 did not have a significant impact on the financial position or results of operations of the Company. Inventory Inventory consisted of the following at: September 30, 2000 June 30, 2000 -------------- ------------- Raw materials $ 920,000 $1,051,000 Work in process 227,000 295,000 Finished goods 1,124,000 929,000 ------------- ------------ $ 2,271,000 $ 2,275,000 ============= ============ 8 THERMOGENESIS CORP. Management's Discussion and Analysis of Financial Condition and Results of Operations for the Three Months Ended September 30, 2000 and 1999 The Company designs, manufactures and distributes equipment to process therapeutically valuable blood components including stem cells and surgical sealants. Initially the Company developed medical devices for ultra rapid freezing and thawing of blood components, which the Company manufactures and distributes in their respective niche markets in blood banks and hospitals. During fiscal 1988 through 2000, the Company has focused on refining product design of the Thermoline(TM) (blood plasma freezers and thawers) products and developing two new technology platforms (BioArchive and CryoSeal Systems). Beginning in late 1993, and with accelerated research and develoment efforts from 1996 to 1999, the Company completed development of the BioArchive and CryoSeal technology platforms, each of which will give rise to multiple medical devices targeted at a number of different medical and surgical applications. To achieve completion of the development and add experienced executive talent to launch the products and move the Company to new levels of growth and revenues, considerable capital resources were used. The Company is currently seeking strategic alliance partners with substantially greater financial and marketing resources than the Company in order to maximize the commercial value of the CryoSeal and BioArchive platform products. The following is Management's discussion and analysis of certain significant factors which have affected the Company's financial condition and results of operations during the period included in the accompanying financial statements. Results of Operations Net Revenues: Net revenues for the three months ended September 30, 2000 were $801,000 compared to $999,000 for the three months ended September 30, 1999. The decrease is primarily due to the non refundable licensing fees of $121,000 received from the distributor of the BioArchive system in Japan which was included in net revenues for the three months ended September 30, 1999. BioArchive revenues increased as one unit was sold during the first quarter of FY2001 versus none in the first quarter of FY2000. Offsetting the increase in BioArchive revenues, freezer sales were down from the prior year as orders for the Company's largest freezers were not received until late in the quarter. As of September 30, 2000 the Company has a cancelable backlog of 10 MP2000 freezers which are expected to ship by December 31, 2000. 9 THERMOGENESIS CORP. Management's Discussion and Analysis of Financial Condition and Results of Operations for the Three Months Ended September 30, 2000 and 1999 (Cont'd) Results of Operations (Cont'd) Cost of Revenues: Cost of revenues as a percent of revenues was approximately 116% for the three months ended September 30, 2000, as compared to 126% for the corresponding fiscal 2000 period. The decrease in cost of revenues is primarily due to lower overhead as a result of better inventory management and cost control measures. However, cost of revenues is higher than net revenues due to the costs required to maintain a manufacturing structure that is compliant with the FDA's Quality System Requirements. General and Administrative Expenses: General and administrative expenses for the three months ended September 30, 2000 decreased $88,000 or 17% from the corresponding fiscal 2000 period. This decrease is primarily the result of personnel reductions which occurred during the prior fiscal year and the Company has elected not to replace the vacant positions. Selling and Service Expenses: Selling and service expenses for the three months ended September 30, 2000 were $478,000, a decrease of $86,000 or 15% from the corresponding fiscal 2000 period. The decrease in selling and service expenses is due to personnel and other cost reductions implemented in the third quarter of FY2000 as the Company focused on bringing the selling and service expenses more in line with the actual revenues produced while still funding activities to drive revenue and ensure customer satisfaction. Research and Development Expenses: Research and development expenses for the three months ended September 30, 2000 decreased by $8,000 or 2% from the corresponding fiscal 2000 period. Research and development expenses remained consistent as the personnel and other cost reductions implemented in the prior year were offset by the costs of the CryoSeal Fibrin Sealant pre clinical trials which should be completed by December 31, 2001. 10 THERMOGENESIS CORP. Management's Discussion and Analysis of Financial Condition and Results of Operations for the Three Months Ended September 30, 2000 and 1999 (Cont'd) Results of Operations (Cont'd) Liquidity and Capital Resources Working capital decreased by $1,105,000. The decrease in cash and short term investments was primarily due to funding of the manufacturing infrastructure, operating expenses, and the costs associated with the CryoSeal Fibrin Sealant pre clinical trials. The Company used $1,177,000 for operations for the three months ended September 30, 2000. This was primarily due to lower sales volume in relationship to fixed manufacturing costs, operating expenses and research and development costs for the testing required to obtain the CE mark on CryoSeal CP-2 disposable and the pre clinical trials. The report of independent auditors on the Company's June 30, 2000 financial statements includes an explanatory paragraph indicating there is substantial doubt about the Company's ability to continue as a going concern. The Company believes that it has developed a viable plan to address these issues and that its plan will enable the Company to continue as a going concern through the end of fiscal year 2001. The plan includes the realization of revenues from the commercialization of new products, the consummation of debt or equity financings and the reduction of certain operating expenses as required. Additionally, the Company is currently pursuing partnering relationships with large corporations in connection with global distribution of either or both of the new product platforms. The financial statements do not include any adjustments to reflect the uncertainties related to the recoverability and classification of assets or the amounts and classification of liabilities that may result from the inability of the Company to continue as a going concern. There is no assurance that the Company will be able to achieve additional financing or reach a strategic relationship, or that such events will be on terms favorable to the Company. The Company made the transition to the calendar year 2000 without "Year 2000" interruptions. The Company did not incur any material costs to be "Year 2000" compliant. At September 30, 2000, the Company has no significant outstanding capital commitments. Backlog The Company's cancelable backlog at September 30, 2000 was $954,000. Purchase orders from two customers for ten MP2000 freezers, including installation and other services totaled $719,000. The remainder of the backlog is composed of orders from a variety of customers for other ThermoLine products, disposables and BioArchive disposables. Quantitative and Qualitative Disclosures About Market Risk All sales, domestic and foreign, are made in U.S. dollars and therefore currency fluctuations are believed to have no impact on the Company's net revenues. The Company has no long-term debt or investments and therefore is not subject to interest rate risk. 11 PART II - OTHER INFORMATION Item 1. Legal proceedings. Cryo-Cell International, Inc., filed a complaint against the Company in the U.S. District Court for the Southern District of New York, styled Cryo-Cell International, Inc. v. THERMOGENESIS CORP., Case No. 00 Civ. 8155, alleging patent infringement by the Company related to the Company's BioArchive System. Although the Company has its own patents and intends to defend the action, the complaint has not been served and the Company has no obligation to respond at this time. Item 2. Changes in Securities. None. Item 3. Default Upon Senior Securities. None. Item 4. Submission of Matters to a Vote of Security Holders. None Item 5. Other Information. None Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits None. (b) Reports on Form 8-K. None. 12 THERMOGENESIS CORP. Signatures In accordance with the requirements of the Exchange Act, the registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized. THERMOGENESIS CORP. (Registrant) Dated November 13, 2000 /s/ Philip H. Coelho ------------------------------------ Philip H. Coelho, Chief Executive Officer and Chairman of the Board (Principal Executive Officer) /s/ Renee M. Ruecker ------------------------------------ Renee M. Ruecker, V.P. Finance (Principal Financial and Accounting Officer) EX-27 2 0002.txt FDS --
5 THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 10-Q FOR THE PERIOD ENDED SEPTEMBER 30, 2000, FOR THERMOGENESIS CORP. AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 3-MOS JUN-30-2001 SEP-30-2000 1,352,000 210,000 752,000 84,000 2,271,000 102,000 2,668,000 1,632,000 5,691,000 1,095,000 0 0 0 27,000 4,515,000 5,691,000 801,000 834,000 926,000 926,000 0 8,305 3,000 (1,423,000) 0 (1,423,000) 0 0 0 (1,423,000) (0.06) (0.06)
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