Contact Us
1-800-639-0643
Navigation
Contact Us
544 Egerton St
London ON, N5W 3Z8
T: 1-800-639-0643
F: 519-434-4382
Press Release
Stellar Pharmaceuticals Profitable for 2010; Revenues Up 32% & Net Profit Up 120%
LONDON, ONTARIO -- (MARKET WIRE) -- Mar 31, 2011 -- Stellar Pharmaceuticals Inc. (OTCQB: SLXCF) ("Stellar" or "the Company"), a Canadian pharmaceutical developer and marketer of high quality, cost-effective products for select health care markets, today announced financial results for the year ended December 31, 2010. In this press release, all dollar amounts are expressed in Canadian currency and results are reported in accordance with United States generally accepted accounting principles (U.S. GAAP).
2010 Highlights
-- Revenues grew by 32.3% -- Fourth consecutive year the Company has been cash-flow positive -- Net profit up 120% over 2009For the twelve-month period ended December 31, 2010, Stellar's total revenues were $4,737,300. This compares to $3,581,300 for the same period in 2009, representing an increase of 32.3%.
International revenues from all sources, including licensing fees for the 12 month period ended December 31, 2010, were up 55.6% compared to the same period in 2009. These revenues included $1,851,100 in licensing fees related to license agreements. NeoVisc sales for the twelve month period ended December 31, 2010, however, were down 64.1%, compared to the same period in 2009 due to a significant decline in European market sales.
Total Canadian market product sales increased 7.8% with increases of 4.3% in NeoVisc sales, 22.1% in Uracyst sales and 10.1% in BladderChek sales.
Net income for 2010, including $270,442 in non-cash stock options and amortization expenses (2009 - $163,800), was $525,700, or $0.02 per share, compared to $238,900, or $0.01 per share, in 2009. This profit was achieved despite the Company recording $596,500 in aggregate one-time expenses in the fourth quarter of 2010, including $401,000 in a retirement payout, $120,300 for expired products and $75,200 for product returns.
Stellar's strong financial performance allowed it to close the year in a strong financial position. As of December 31, 2010, the Company had cash and cash equivalents of $4,352,300. This was up from $2,325,200 at the end of 2009. The Company remains debt free.
Arnold Tenney, Stellar's President and Chief Executive Officer commented, "We are very pleased to have built upon our record of achieving a substantial increase in profit. This is especially true in light of the significant one-time charges that were recorded this year. The Company's objective is to continue to pursue opportunities in licensing new products within Canada and out licensing NeoVisc and Uracyst throughout the world."
About Stellar Pharmaceuticals Inc.
Stellar has developed and is marketing direct in Canada, and in countries around the world through out-license agreements, three products based on its core polysaccharide technology: NeoVisc® and NeoVisc® Single Dose, for the symptomatic treatment of osteoarthritis; and Uracyst®, its patented technology for the treatment of interstitial cystitis (IC), an inflammatory disease of the urinary bladder wall. Both NeoVisc and Uracyst have their CE Mark certification for the European Community. Stellar also has an in-licensing agreement for NMP22® BladderChek®, a proteomics-based diagnostic test for the diagnosis and monitoring of bladder cancer. For more information, please visit the company's website at www.stellarpharma.com.
Forward-Looking Statements
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties impacting the Company's business including increased competition; the ability of the Company to expand its operations, to attract and retain qualified professionals, technological obsolescence; general economic conditions; and other risks detailed from time to time in the Company's filings.
STELLAR PHARMACEUTICALS INC.
BALANCE SHEETS
(Expressed in Canadian dollars)
December 31
ASSETS 2010 2009
CURRENT
-------------------------------------
Cash and cash equivalents $ 4,352,285 $ 2,325,212
Accounts receivable, net of allowance
of $nil (2009 - $nil) 493,370 293,565
Inventories 611,676 721,061
Taxes recoverable - 1,501
Loan receivable 15,814 15,818
Prepaids, deposits and sundry
receivables 99,433 163,698
-------------------------------------
Total current assets 5,572,578 3,520,855
PROPERTY, PLANT AND EQUIPMENT, net 1,568,729 1,390,296
OTHER ASSETS 139,287 114,553
-------------------------------------
Total assets $ 7,280,594 $ 5,025,704
-------------------------------------
-------------------------------------
LIABILITIES
CURRENT
Accounts payable $ 236,420 $ 228,367
Accrued liabilities 557,735 175,637
Deferred revenues 8,645 2,890
Product returns liability 112,500 -
-------------------------------------
Total current liabilities 915,300 406,894
LONG TERM WARRANT LIABILITY 216,823 -
-------------------------------------
Total liabilities 1,132,123 406,894
-------------------------------------
CONTINGENCIES AND COMMITMENTS
SHAREHOLDERS' EQUITY
CAPITAL STOCK
AUTHORIZED
Unlimited
Non-voting, convertible redeemable
and retractable preferred shares
with no par value
Unlimited
Common Shares with no par value
ISSUED
24,585,040 Common Shares (2009 -
23,480,040) 9,055,982 8,183,638
Additional Paid-in capital options -
outstanding 211,781 89,562
Additional Paid-in capital options -
expired 733,517 724,127
-------------------------------------
10,001,280 8,997,327
DEFICIT (3,852,809) (4,378,517)
-------------------------------------
Total shareholders' equity 6,148,471 4,618,810
-------------------------------------
Total liabilities and shareholders'
equity $ 7,280,594 $ 5,025,704
-------------------------------------
-------------------------------------
STELLAR PHARMACEUTICALS INC.
STATEMENTS OF OPERATIONS
(Expressed in Canadian dollars)
FOR THE YEARS ENDED DECEMBER 31
2010 2009
------------------------------------
PRODUCT SALES $ 2,714,935 $ 3,000,062
ROYALTIES & LICENSING REVENUE 2,022,383 581,230
------------------------------------
TOTAL REVENUE FROM ALL SOURCES 4,737,318 3,581,292
COST OF PRODUCTS SOLD 947,069 1,001,871
EXPIRED PRODUCTS 120,328 -
PRODUCT RETURNS ALLOWANCE 75,160 -
------------------------------------
GROSS PROFIT 3,594,761 2,579,421
EXPENSES
Selling, general and administrative
(i) 2,488,278 2,278,530
Retirement payout 401,000 -
Change in warrant liability 10,048 -
Loss on disposal of equipment 15,308 -
Research and development 115,471 18,107
Amortization of assets (non-
manufacturing property, plant and
equipment) 49,720 55,822
------------------------------------
3,079,825 2,352,459
------------------------------------
INCOME FROM OPERATIONS 514,936 226,962
INTEREST AND OTHER INCOME 10,772 11,962
------------------------------------
NET INCOME FOR THE YEAR (before tax) 525,708 238,924
INCOME TAXES - -
------------------------------------
NET INCOME $ 525,708 $ 238,924
------------------------------------
------------------------------------
EARNINGS PER SHARE
- Basic $ 0.02 $ 0.01
------------------------------------
------------------------------------
- Diluted $ 0.02 $ 0.01
------------------------------------
------------------------------------
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING
- Basic 23,767,369 23,498,889
------------------------------------
------------------------------------
- Diluted 23,767,369 23,498,889
------------------------------------
------------------------------------
STELLAR PHARMACEUTICALS INC.
STATEMENTS OF CASH FLOWS
(Expressed in Canadian dollars)
FOR THE YEARS ENDED DECEMBER 31
2010 2009
CASH FLOWS PROVIDED BY OPERATING
ACTIVITIES
Net income $ 525,708 $ 238,924
Items not affecting cash
Amortization 104,042 108,492
Loss on disposal of equipment 15,308 --
Unrealized foreign exchange (gain)
loss -- 24,203
Issuance of equity instruments for
services rendered 4,000 --
Change in warrant liability 10,048 --
Stock-based compensation 166,400 55,352
Change in non-cash operating assets
and liabilities 483,754 26,143
-------------------------------------
CASH FLOWS PROVIDED BY OPERATING
ACTIVITIES 1,309,260 453,114
-------------------------------------
CASH FLOWS PROVIDED BY (USED IN)
INVESTING ACTIVITIES
Additions to property, plant and
equipment (307,920) (155,630)
Increase in other assets (27,224) (26,230)
Proceeds from sale of equipment 12,630 --
-------------------------------------
CASH FLOWS PROVIDED BY INVESTING
ACTIVITIES (322,514) (181,860)
-------------------------------------
CASH FLOWS PROVIDED BY FINANCING
ACTIVITIES
Repurchase of Common Shares for cash -- (30,357)
Stock options exercised 69,000 --
Issuance costs (42,273) --
Private placement units issued for
cash 1,013,600 --
-------------------------------------
CASH FLOWS PROVIDED BY FINANCING
ACTIVITIES 1,040,327 (30,357)
-------------------------------------
EFFECT OF EXCHANGE RATES ON CASH HELD
IN
FOREIGN CURRENCY -- (21,650)
-------------------------------------
CHANGE IN CASH AND CASH EQUIVALENTS 2,027,073 219,246
CASH AND CASH EQUIVALENTS, beginning of
year 2,325,212 2,105,966
-------------------------------------
CASH AND CASH EQUIVALENTS, end of year $ 4,352,285 $ 2,325,212
-------------------------------------
-------------------------------------
Contacts: Stellar Pharmaceuticals Inc. Arnold Tenney President and CEO (416) 587-3200 www.stellarpharma.com