VANCOUVER, BC / ACCESSWIRE / April 29, 2019 / LED Medical Diagnostics Inc. (“LED” or the “Company”), a leading dental imaging technology provider focused on delivering state- of-the-art imaging software and systems, today announced its financial results for the fourth quarter and year ended December 31, 2018, reported in United States dollars and in accordance with International Financial Reporting Standards (“IFRS”). The Company’s results are presented in comparison to the fourth quarter and year ended December 31, 2017.
The Company reported 2018 revenue of $14.2m which represents 12% revenue growth year over year. Gross margin2 was 61%, as compared to 56% for the year ended December 31, 2017. The Company also reported positive EBITDA1 of $99k or 1% of revenue, as compared to ($1,588,204) for the year ended December 31, 2017. EBITDA1 of $99k for year ended 2018 was net of a one-time expense of $172k to exit a property lease commitment related to the Company’s Apteryx integration and $355k of expenses recognized in relation to the preferred share financing.
“2018 marks the first year that the company has achieved positive EBITDA,” commented LED CEO Dr. David Gane. “Our improved financial performance is a direct result of the successful integration of our Apteryx subsidiary providing significant year over year high margin recurring revenue growth, a trend we expect will continue as we execute on our plan.”
Highlights During the Year Ended December 31, 2018
- The Company’s wholly owned subsidiary Apteryx, Inc. Awarded a Five-Year Contract with the United States Dept. of Veteran’s Affairs Federal Supply Schedule (FSS) effective from 9/15/2018 through 9/14/2023 including a renewal option for an additional 5-year period. The contract award provides Apteryx the ability to serve as a preferred supplier of dental imaging products, software and services to United States government institutions worldwide.
- VELscope® VX receives 8th consecutive Cellerant “Best of Class” Technology Award for 2018
- Apteryx Inc, the Company’s wholly-own subsidiary, received approval by the United States Food and Drug Administration for their XVWeb® 3D imaging service. The XVWeb 3D is uniquely designed to provide additional functionality to its XVWeb service platform by providing dental professionals with a wide variety of visualization and diagnostic capabilities for CBCT DICOM data sets via an intuitive web-based user interface.
- Completed a financing through the issuance of 12,175,553 convertible Preferred Shares of the Company at an issue price of CDN$0.45 per share for gross proceeds of CDN$5.48m with an annual dividend of 5%. In addition, the Company, issued 8,147,071 Preferred Shares in exchange for approximately CDN$3.67m of outstanding senior secured debentures (including accrued interest), which included an annual interest rate of 12%.
- Payment of deferred consideration totaling $1.2m, relating to the 2017 purchase of Apteryx, Inc.
Financial Highlights for the Year Ended December 31, 2018
Net revenue for the year ended December 31, 2018 was $14,215,812 representing an increase of 12% from the year ended December 31, 2017. The Company’s gross margin2 was 61% for the year ended December 31, 2018 as compared to 56% for the year ended December 31, 2017. 2018 EBITDA1 was $99,176 compared to EBITDA1 (net of acquisition costs) of ($1.2M) in 2017.
Net income for the year ended December 31, 2018 was $816,450 compared to net loss of ($2,495,015) for the year ended December 31, 2017.
Cash used in operations was $1,799,295 during the year ended December 31, 2018 compared to cash used in operations of $4,432,082 during the year ended December 31, 2017. Inflows from financing for the year ended December 31, 2018 were $2,000,875 compared to $12,791,305 for the year ended December 31, 2017. The cash outflows from investing activities were $21,684.
Interest expenses totaled $1,062,437 for the year ended December 31, 2018 which included a non-cash interest expense of $130,262 relating to the accretion of interest for the preferred shares. The Company has current annual interest obligations of 5% for the preferred shares and 12% for the debentures.
The Company had cash of $2,827,882 and Net Working Capital of $776,681 as of December 31, 2018. Net Working Capital is defined as total current assets less total current liabilities.
Financial Highlights for the three months ended December 31, 2018
Net revenue for the three months ended December 31, 2018 was $3,811,629 representing an increase of 3% from the three months ended December 31, 2017. The Company’s gross margin2 was 55% for the three months ended December 31, 2018 as compared to 53% for the three months ended December 31, 2017. EBITDA1 was ($414,598) for the three months ended December 31, 2017 compared to EBITDA1 of $(805,660) for the three months ended December 31, 2017.
Net income for the three months ended December 31, 2018 was $538,132 compared to net loss of $(864,574) for the three months ended December 31, 2017.
Financial Statements and Management’s Discussion & Analysis
Please see the consolidated financial statements and related Management’s Discussion & Analysis (“MD&A”) for more details. The consolidated financial statements for the three months and year ended December 31, 2018 and related MD&A have been reviewed and approved by the Company’s Audit Committee and Board of Directors. The Company has prepared this truncated news release to alert investors to its results and that a more detailed explanation and analysis is readily available in the MD&A. These reports have been filed on SEDAR at www.sedar.com and also posted to www.ledapteryx.com.
About LED Medical Diagnostics Inc.
LED Medical Diagnostics Inc. is a dental imaging technology provider focused on delivering state-of-the-art imaging software and systems. Through its wholly-owned subsidiaries LED Dental Inc., LED Dental Ltd., and Apteryx, Inc., LED Medical has provided dentists and oral health specialists with advanced diagnostic imaging products and software for over 20 years. LED’s proprietary technologies include the VELscope® Vx Enhanced Oral Assessment and TUXEDO Intraoral Sensors, in addition to Apteryx’s XrayVision®, XVWeb and XrayVision® DCV imaging software solutions.
Backed by an experienced leadership team and dedicated to a higher level of service and support, LED is committed to providing dental practitioners with the best technology available by identifying and adding leading products to its growing portfolio.
The Company is currently listed on the TSX-V under the symbol LMD, the OTCQB under the symbol LEDIF, as well as the Frankfurt Stock Exchange under the symbol LME.
LED Dental Chris Koch
Dr. David Gane, CEO Phone: 604.434.4614 x227
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
This press release contains statements which, to the extent that they are not recitations of historical fact, may constitute forward-looking information under applicable Canadian securities legislation that involve risks and uncertainties. Such forward-looking statements or information include statements regarding, but not limited to the Company’s future growth strategy, its distribution strategy and product offerings, potential expansion of the Company’s technology to other medical applications or markets, or the potential introduction of new technologies by the Company. Persons reading this press release are cautioned that such statements or information are only predictions, and that the Corporation’s actual future results or performance may be materially different. Factors that could cause actual events or results to differ materially from those suggested by these forward-looking statements include, but are not limited to competition risks, distributor risks, product development risks such as regulatory, design, intellectual property and other factors described in the Corporation’s reports filed on SEDAR including its Annual Information Form and financial report for the year ended December 31, 2018. These and
other factors should be considered carefully, and readers should not place undue reliance on such forward-looking information. All forward-looking statements made in this press release are qualified by this cautionary statement and there can be no assurance that actual results or developments anticipated by the Company will be realized. The Company disclaims any intention or obligation to update or revise forward-looking information, whether as a result of new information, future events or otherwise, except as required by law.
1 EBITDA or Earnings before Interest, Taxes, Depreciation and Amortization is a non-IFRS measure that does not have a standardized meaning and may not be comparable to a similar measure disclosed by other issuers. This measure does not have a comparable GAAP measure. EBITDA referenced here relates to net revenue less cost of goods sold, sales and marketing, research and development and administration expenses but excludes interest, income taxes, depreciation, amortization, finder’s warrants issuance costs, stock-based compensation, deferred share unit compensation, mark to market adjustments on Canadian dollar denominated warrants, foreign exchange gain or loss and other income. This measure does not have a comparable IFRS measure and is used by the Company to manage and evaluate the cash operating loss of the business.
2 Gross margin is a non-IFRS measure that does not have a standard meaning and may not be comparable to a similar measure disclosed by other issuers. Gross margin referenced here relates to revenues less cost of sales. This measure does not have a comparable IFRS measure and is used by the Company to manage and evaluate the operating performance of the Company.
SOURCE: LED Medical Diagnostics Inc.
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