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Broad Street Alerts recent profiles and track record, 433% in verifiable potential gains for our members on the last 2 small cap alerts alone!
May 11th, 2016- (NASDAQ: STEM) opened $2.92/share hit a high of $3.90/share within a few hours our member potential gains- 33%
May 9th, 2016-(NYSE-MKT: MGT) opened at .64/share and hit 3.26/share within one week for gains of 400% for our members.
Report for: Venaxis, Inc. (NASDAQ: APPY)
Excerpts from Form 10-Q filed 5-11-16
The Company has experienced recurring losses and negative cash flows from operations. At March 31, 2016, the Company had approximate balances of cash and liquid investments of $16,600,000, working capital of $16,183,000, total stockholders’ equity of $16,678,000 and an accumulated deficit of $105,023,000. To date, the Company has in large part relied on equity financing to fund its operations. The Company expects to continue to incur losses from operations for the near-term and these losses could be significant as professional and other associated expenses in connection with possible strategic considerations, evaluations and transactions, appendicitis portfolio related expenses, public company and administrative related expenses are incurred. The Company believes that its current working capital position will be sufficient to meet its estimated cash needs into early 2017. The Company is closely monitoring its cash balances, cash needs and expense levels.
As part of the Company’s process to identify possible strategic partners, several targets were identified that the Company assessed as possibly having a business model that could be interested in discussions with Venaxis for possibly acquiring or licensing the appendicitis assets. Venaxis has made initial contact with several of these parties to gauge their interest level, which initially is more focused on the APPY2 development assets. Management believes that the estimated potential market for an appendicitis test continues to be significant. If Venaxis is unable to locate a new strategic target, a partner or other third-party interested in advancing development and commercial activities of the Venaxis appendicitis portfolio, the capitalized costs on the Company’s balance sheet, totaling approximately $374,000, as of March 31, 2016 for the acute appendicitis patents may be deemed impaired.
Selling, general and administrative expenses in the three months ended March 31, 2016 totaled $1,030,000, which is approximately $506,000, or 33%, decrease as compared to the 2015 period. Commercialization, marketing and compensation related expenses decreased by approximately $329,000 in the 2016 period as the Company began winding down APPY1 commercialization activities. Stock based compensation also decreased by approximately $347,000 for the three months ended March 31, 2016 as compared to the 2015 period due to no options being granted to directors, management and employees. A decrease of $78,000 in legal expenses for the 2016 period was due to the settlement/dismissal of litigation in late 2015. These decreases were offset by an increase in strategic evaluation costs of approximately $302,000 as the Company continued to evaluate possible alternatives including the Strand transaction.
Research and development expenses in the three months ended March 31, 2016 totaled $373,000, which is approximately a $335,000, or 47%, decrease as compared to the 2015 period. A decrease of $294,000 was due primarily to winding down development and commercialization of APPY2 and APPY1 operations. A decrease of $137,000 was due to staff reductions related to winding down such operations. These decreases were partially offset by an increase in patent impairment costs of approximately $134,000.
Interest expense for the three months ended March 31, 2016, increased to $26,000 compared to $25,000 in the 2015 period. For the three months ended March 31, 2016, the Company recorded investment income of approximately $44,000 compared to investment income of $51,000 in the 2015 period.
On February 25, 2016, the Company completed the sale of its corporate headquarters, land, building and certain fixtures and equipment to a third party at a purchase price of $4,053,000. The sale resulted in a gain of approximately $1,900,000 and generated approximately $1,700,000 in net cash after expenses and mortgage payoffs. The Company is leasing back space in the building under short term lease agreements that provide office and storage space required for its current level of operations.
No income tax benefit was recorded on the net loss for the three months ended March 31, 2016 and 2015, as management was unable to determine that it was more likely than not that such benefit would be realized.
Net cash consumed by operating activities was $1,903,000 during the three months ended March 31, 2016. Cash was generated by a net income of $560,000, less non-cash expenses of $201,000 for stock-based compensation, depreciation and amortization, and impairment of patent costs, offset by the gain on sale of property and equipment of $1,919,000 and amortization of license fees totaling $24,000. Decreases in prepaid and other current assets of $69,000 provided cash, primarily related to routine changes in operating activities. There was a $789,000 decrease in accounts payable and accrued expenses in the three months ended March 31, 2016, primarily due to the payment of 2015 accrued incentives in early 2016, and a reduction in overall expenses due to the wind down of the APPY1 activities.
Net cash consumed by operating activities was $2,287,000 during the three months ended March 31, 2015. Cash was consumed by the loss of $2,186,000, less non-cash expenses of $497,000 for stock-based compensation and depreciation and amortization, offset by the amortization of license fees totaling $24,000. Decreases in prepaid and other current assets of $97,000 provided cash, primarily related to routine changes in operating activities. There was a $670,000 decrease in accounts payable and accrued expenses in the three months ended March 31, 2015, primarily due to a decrease in the accrued compensation.
Investing Activities
Net cash inflows from investing activities provided $3,849,000 during the three months ended March 31, 2016. Sales of marketable securities investments totaling approximately $9,649,000 provided cash net of marketable securities purchased totaling approximately $7,538,000. An $11,000 use of cash was attributable to additional costs incurred from patent filings. The sale of the land, building and assets generated approximately $1,749,000 in cash.
Net cash inflows from investing activities provided $3,083,000 during the three months ended March 31, 2015. Sales of marketable securities investments totaled approximately $14,403,000 and marketable securities purchased totaled approximately $11,306,000. A $15,000 use of cash was attributable to additional costs incurred from patent filings.
Source – Company 10-Q filed 5-11-16
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