Champions Oncology, Inc. (Nasdaq: CSBR), engaged in the development of advanced technology solutions and services to personalize the development and use of oncology drugs, recently declared its financial results for the 2nd-fiscal quarter and six months finished October 31, 2017.
2nd-Quarter and Recent Business Highlights:
Table of Contents
- Record quarterly revenue of $5.20M, a boost of 16.7 percent year-over-year
- Record Translational Oncology Services (“TOS”) revenue of $4.8M, a boost of 21.8 percent year-over-year
Awarded a two-year, $2M, competitively-bid contract through the Small Business Innovation Research (SBIR) program to build and study an ethnically diverse cohort of metastatic prostate patient-derived xenograft (PDX) models
Clinical correlation between patient-derived xenograft (PDX) model responses and patient responses to oncology therapies highlighted in journal, Annals of Oncology; the report was published by the European Society for Medical oncology (ESMO), the leading European professional organization for medical oncology in Europe.
Reiterated expectations for fiscal year 2018 revenue growth of at least 20 percent over fiscal year 2017.
Financial Results
For the 2nd-quarter of fiscal 2018, revenue increased 16.7 percent to $5.2M, as contrast to $4.5M for the 2nd-quarter of fiscal 2017. Total operating expenses for the 2nd-quarter fiscal 2018 and 2017 was $5.3M and $5M, respectively, a boost of $300,000 or 6.5 percent. Revenue was $10.2M and $8.1M for the six months finished October 31, 2017 and 2016, respectively, a boost of $2.1M or 26 percent. Total operating expenses for the six months finished October 31, 2017 and 2016 was $10.9M and $11.1M, respectively, a decrease of $200,000 or (2 percent).
For the 2nd-quarter of fiscal 2018, Champions stated a loss from operations of $70,000, counting $148,000 in stock-based compensation, an improvement of $423,000 or 85.8 percent contrast to the loss from operations of $493,000, inclusive of $535,000 in stock-based compensation, in the 2nd-quarter of fiscal 2017. Apart From stock based compensation and depreciation, Champions recognized net income from operations of $ 175,000 for the 2nd-quarter 2018.
Net cash generated was $229,000 for the 3-months finished October 31, 2017. Net cash used for the same period last year was $134,000. The improvement in cash flow is the result of revenue growth and expense administration.
The Company finished the quarter with $660,000 of cash and cash equivalents and reiterates its position that it does not presently intend to raise capital in the equity market.
TOS revenue was $4.8M for the 3-months finished October 31, 2017 contrast to $4M for the 3-months finished October 31, 2016, a boost of $800,000 or 21.8 percent.
TOS cost of sales was $2.4M for the 3-months finished October 31, 2017, a boost of $600,000, or 30.9 percent, contrast to $1.8M for the 3-months finished October 31, 2016. For the 3-months finished October 31, 2017 and 2016, gross margin for TOS was 50.4 percent and 53.8 percent, respectively. The increase in TOS cost of sales was because of a boost in the number and size of TOS studies. The gross margin often fluctuates quarter to quarter, resulting from timing differences between revenue and expense recognition.
Personalized Oncology Services (“POS”) revenue was $378,000 and $497,000 for the 3-months finished October 31, 2017 and 2016, respectively, a decrease of $119,000 or (23.9 percent). The decrease is due mainly to a decrease in implant and drug study revenue.
POS cost of sales was $259,000 for the 3-months finished October 31, 2017, a decrease of $115,000, or (30.7 percent), contrast to $374,000 for the 3-months finished October 31, 2016. For the 3-months finished October 31, 2017 and 2016, gross margin for POS was 31.5 percent and 24.8 percent, respectively. The improvement is attributed to the increase in higher margin sequencing revenue.
Research and development expense was $1.1M for the 3-months finished October 31, 2017, a boost of $100,000, or 10.6 percent, contrast to $1M for the 3-months finished October 31, 2016. Sales and marketing expense for the 3-months finished October 31, 2017 was $551,000, a decrease of $166,000, or (23.2 percent), contrast to $717,000 for the 3-months finished October 31, 2016. The decrease is mainly because of a reduction of marketing resources for the POS division. General and administrative expense was $1M for both the 3-months finished October 31, 2017 and 2016.
Year-to-Date Financial Results
For the first six months of fiscal 2018, revenue increased 26.0 percent to $10.2M, as contrast to $8.1M for the first six months of fiscal 2017. Total operating expenses for the first six months of fiscal 2018 were $10.9M contrast to $11.1M for the first six months of fiscal 2017, a decrease of $200,000 or (1.9 percent).
For the first six months of fiscal 2018, Champions stated a loss from operations of $689,000, counting $711,000 and $132,000 in stock-based compensation and depreciation, respectively, an improvement of $2.3M, or 77.2 percent, contrast to the loss from operations of $3M, inclusive of $1.7M and $87,000 in stock-based compensation and depreciation, respectively, in the first six months of fiscal 2017. Apart From stock-based compensation and depreciation, Champions recognized income from operations of $155,000 for the six months finished October 31, 2017 contrast to net loss of $1.3M for the six months finished October 31, 2016.
TOS revenue was $9.4M for the six months finished October 31, 2017 contrast to $7.1M for the six months finished October 31, 2016, a boost of $2.3M or 32.3 percent.
TOS cost of sales was $4.6M for the six months finished October 31, 2017, a boost of $700,000, or 19.8 percent, contrast to $3.9M for the six months finished October 31, 2016. Gross margin for TOS was 50.7 percent for the first six months of fiscal 2018 contrast to 45.5 percent for the first six months of fiscal 2017.
POS revenue was $818,000 for the six months finished October 31, 2017 contrast to $1.0M for the six months finished October 31, 2016, a decrease of $182,000 or (18.8 percent).
POS cost of sales was $646,000 for the six months finished October 31, 2017, a decrease of $201,000, or (23.7 percent), contrast to $847,000 for the six months finished October 31, 2016. Gross margin for POS for the six months finished October 31, 2017 was 21 percent contrast to 15.9 percent for the six months finished October 31, 2016.
Research and development expense was $2.2M for both the six months finished October 31, 2017 and 2016. Sales and marketing expense for the six months finished October 31, 2017 was $1.2M, a decrease of $400,000, or (24.8 percent), contrast to $1.6M for the six months finished October 31, 2016. General and administrative expense was $2.2M for the six months finished October 31, 2017, a decrease of $400,000 or (15.3 percent), contrast to $2.6M for the six months finished October 31, 2016.
Net cash used in operations was $1.7M for the six months finished October 31, 2017 contrast to $2.6M for the six months finished 2016, a decrease of $900,000 or 34.3 percent.
