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Calmare Therapeutics Reports Year End; Fourth Quarter 2014 Results
[June 25, 2015]

Calmare Therapeutics Reports Year End; Fourth Quarter 2014 Results


Calmare Therapeutics Incorporated, (OTC:CTTC) (CTI), the pain mitigation company, reported results for the year and quarter ended December 31, 2014.

Year Ended December 31, 2014

Revenue from the sale and shipment of the Calmare® pain therapy devices (Devices) for the year ended December 31, 2014 increased 60% or $392,000 to $1,045,000 as compared with $653,000 for the year-ended December 31, 2013.

Device sales for the year ended December 31, 2014 increased 88% or 8 Devices to 17 Devices as compared with 9 Devices for the year ended December 31, 2013. Due to the relatively long sales cycle for a Device, Device sales can and will vary significantly from period to period.

Total expenses for the year ended December 31, 2014 increased 30% or $963,000 to $4,134,000 as compared with $3,171,000. Total expenses include approximately $620,000 of additional interest expense related to the Company's 90 day Convertible Notes for the year ended December 31, 2014.

General and administrative expenses for the year ended December 31, 2014 decreased 22% or $390,000 to $1,371,000 as compared with $1,761,000 for the year ended December 31, 2013.

Total assets at December 31, 2014 decreased $136,000 to $4,430,000 as compared with $4,566,000 at December 31, 2013.

Total liabilities at December 31, 2014 increased $1,658,000 to $12,169,000 as compared with $10,511,000 at December 31, 2013.

Net loss for the year ended December 31, 2014 increased to $3,411,000 or $0.15 per basic and diluted share as compared with a net loss of $2,672,000 or $0.16 for the year ended December 31, 2013.

Total capital raised over the past five quarters was $1,494,000 and consisted of: $466,000 of hybrid debt and $1,028,000 of equity.

Quarter Ended December 31, 2014

Revenue from the sale and shipment of the Calmare® pain therapy devices (Devices) for the quarter ended December 31, 2014 decreased 52% or $119,000 to $108,000 as compared with $227,000 for the quarter ended December 31, 2013. This is largely attributable to the cyclicality and historically sales slow-down the Company has witnessed over the last four years with respect to Device sales and its related consumables in the fourth quarter.

Device sales for the quarter ended December 31, 2014 decreased 33% to two (2) Devices as compared with three (3) Devices for the comparable quarter ended December 31, 2013 and as compared with eight (8) for the sequential quarter ended September 30, 2014. Due to the relatively long sales cycle for a Device, Device sales can and will vary significantly from quarter to quarter.

Total expenses for the quarter ended December 31, 2014 increased 7% or $54,000 to $810,000 as compared with $756,000 for the quarter ended December 31, 2013.

General and administrative expenses for the quarter ended December 31, 2014 decreased 14% or $69,000 to $427,000 as compared with $496,000 for the quarter ended December 31, 2013.

Total assets at December 31, 2014 decreased $109,000 to $4,430,000 as compared with $4,539,000 at September 30, 2014.

Total liabilities at December 31, 2014 increased $371,000 to $12,169,000 as compared with $11,798,000 at September 30, 2014.

Net loss for the quarter ended December 31, 2014 increased to $645,000 or $0.03 per basic and diluted share as compared with a net loss of $611,000 or $0.03 per basic and diluted share for the quarter ended December 31, 2013,

Cash-on-hand at December 31, 2014 decreased $51,000 to $6,000 from $57,000 at December 31, 2013.

"Our year-end numbers exceeded our projections and is a good starting point for 2015" said CTI President & CEO Conrad Mir. "Although there is much work ahead, we look forward to the promise 2015 holds with a careful vigilance on the second half of the year."

About the Company

Calmare Therapeutics Incorporated, the pain mitigation company, develops and commercializes innovative wound and pain management products and technologies. CTI holds the 510k clearance on its flagship product, the non-invasive Calmare® Pain Therapy Device, which grants it an exclusive right to sell, market, research and develop the medical device. The Company is the exclusive licensed global distributor of Calmare.

Forward-Looking Statement

Certain statements contained in this press release are forward-looking statements that involve risks and uncertainties. The statements contained herein that are not purely historical are forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements deal with the Company's current plans, intentions, beliefs and expectations and statements of future economic performance. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from what is currently anticipated. Factors that could cause or contribute to such differences include those discussed from time to time in reports filed by the Company with the Securities and Exchange Commission. The Company cannot guarantee its future results, levels of activity, performance or achievements.





 

CALMARE THERAPEUTICS INCORPORATED AND SUBSIDIARY

Consolidated Balance Sheets

       
December 31,
2014 		December 31,
2013
ASSETS
Current Assets:
Cash $ 5,745 $ 57,009

Receivables, net of allowance of $317,659 and $101,154 at December 31, 2014
and 2013

2,319 143,330
Inventory 4,118,220 4,278,220
Prepaid expenses and other current assets   253,102   65,167
Total current assets 4,379,386 4,543,726
Security deposits 15,000 15,000
Property and equipment, net   35,640   7,606
 
TOTAL ASSETS $ 4,430,026 $ 4,566,332
 
LIABILITIES AND SHAREHOLDERS' DEFICIT
Current Liabilities:
Accounts payable $ 1,346,138 $ 692,251
Liabilities under claims purchase agreement 1,995,320 2,093,303
Accounts payable, GEOMC 4,182,380 4,183,535
Accrued expenses and other liabilities 1,590,182 582,987
Deferred revenue 19,686 6,400
Notes payable 2,536,830 2,488,691
Warrant liability - 8,227
Series C convertible preferred stock liability 375,000 375,000
Series C convertible preferred stock derivative liability   66,177   80,408
Total current liabilities 12,111,713 10,510,802
 
Long term notes payable 56,659 -
 
Commitments and contingencies
Shareholders' deficit:

5% preferred stock, $25 par value, 35,920 shares authorized, 2,427 shares
issued and outstanding

60,675 60,675

Series B preferred stock, $0.001 par value, 20,000 shares authorized, no shares
issued and outstanding

- -

Series C convertible preferred stock, $1,000 par value, 750 shares authorized,
375 shares issued and outstanding

- -

Common stock, $.01 par value, 40,000,000 shares authorized, 25,908,978
shares issued and outstanding at December 31, 2014 and 19,952,907 shares
issued and outstanding at December 31, 2013

259,089 199,529
Capital in excess of par value 47,634,857 46,077,394
Accumulated deficit   (55,692,967 )   (52,282,068 )
 
Total shareholders' deficit   (7,738,346 )   (5,944,470 )
 
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT $ 4,430,026 $ 4,566,332
 

 

CALMARE THERAPEUTICS INCORPORATED AND SUBSIDIARY

Consolidated Statements of Operations

         
Year ended
December 31, 2014 		Year ended
December 31, 2013
Revenue
Product sales $ 1,045,080 $ 652,792
Cost of product sales   440,668   272,736
Gross profit from product sales 604,412 380,056
 
Other Revenue
Retained royalties 27,782 37,007
Other income   90,776   82,069
Total other revenue 118,558 119,076
 
Operating expenses
Selling expenses 213,419 159,245
Personnel and consulting expenses 1,368,299 1,100,041
General and administrative expenses   1,371,035   1,760,585
Total operating expenses 2,952,753 3,019,871
 
Operating loss   (2,229,783 )   (2,520,739 )
 
Other expense (income)
Interest expense 964,070 209,953
Interest expense - accelerated upon conversion of OID notes 35,109 -
Loss on conversion of notes 63,867 -
Loss on settlement of note and warrant 132,301 -
Unrealized gain on derivative instruments   (14,231 )   (58,538 )
Total other expense   1,181,116   151,415
 
Loss before income taxes (3,410,899 ) (2,672,154 )
Provision (benefit) for income taxes   -   -
 
Net loss $ (3,410,899 ) $ (2,672,154 )
 
Basic and diluted loss per share $ (0.15 ) $ (0.16 )
 

Basic and diluted weighted average number of common shares
outstanding:

23,513,870 16,977,027
 
 

CALMARE THERAPEUTICS INCORPORATED AND SUBSIDIARY

Consolidated Statements of Changes in Shareholders' Deficit

             
Preferred Stock Common Stock
Shares

outstanding

    Amount Shares

outstanding

    Amount

Capital in excess

of par value

Accumulated

deficit

Total Shareholders'

Deficit

 
Balance - January 1, 2013   2,427 $ 60,675   15,237,304 $ 152,373 $ 45,367,796 $ (49,609,914 ) $ (4,029,070 )
Net loss - - - - - (2,672,154 ) (2,672,154 )
 
Stock option compensation expense - - - - 116,365 - 116,365

Common shares issued for legal
services

- - 1,300,000 13,000 250,000 - 263,000

Common stock issued in
accordance with escrow
agreement

- - 1,000,000 10,000 (10,000 ) - -

Common stock issued in
accordance with liability
purchase agreement

- - 1,618,235 16,182 (16,182 ) - -

Common stock issued as part of
equity purchase agreement
and/or liability purchase
agreement

- - 710,000 7,100 215,400 - 222,500
Common stock issued to directors - - 87,368 874 33,228 - 34,102

Warrants and beneficial conversion
feature on notes payable

  -   -   -   -   120,787   -   120,787
 
Balance - December 31, 2013 2,427 60,675 19,952,907 199,529 46,077,394 (52,282,068 ) (5,944,470 )
Net loss - - - - - (3,410,899 ) (3,410,899 )

Common shares and warrants
issued for consulting services

- - 60,000 600 84,600 - 85,200

Common stock issued to directors

- - 10,625 106 3,932 - 4,038

Stock option compensation
expense

- - - - 57,291 - 57,291

Common stock issued upon
conversion of notes

- - 1,732,946 17,329 394,280 - 411,609

Private offering of common stock
and warrants

- - 4,152,500 41,525 788,975 - 830,500

Warrant and beneficial
conversion feature on notes
payable

- - - - 121,741 - 121,741

Liabilities settled under Liability
Purchase Agreement

  -   -   -   -   106,644   -   106,644
Balance - December 31, 2014   2,427 $ 60,675   25,908,978 $ 259,089 $ 47,634,857 $ (55,692,967 ) $ (7,738,346 )
 
 

CALMARE THERAPEUTICS INCORPORATED AND SUBSIDIARY

Consolidated Statements of Cash Flows

   

 

Year ended
December 31, 2014 		Year ended
December 31, 2013
Cash flows from operating activities:
Net loss $ (3,410,899 ) $ (2,672,154 )

Adjustments to reconcile net loss to net cash used in operating
activities:

Depreciation and amortization 17,547 11,147
Stock option compensation expense 57,291 116,365
Share-based compensation - common stock 4,038 7,655
Common stock and warrants issued to consultants 85,200 -
Bad debt expense 216,505 8,588
Unrealized gain on derivative instrument (14,231 ) (58,538 )
Debt discount amortization 217,323 63,480
Noncash finance charges 17,591 216,650
Loss on conversion of notes 63,867 -
Loss on settlement of note and warrant 132,301 -
Changes in assets and liabilities:
Receivables (75,494 ) 64,447
Prepaid expenses and other current assets (187,935 ) 276,560
Inventory 160,000 90,000
Accounts payable, accrued expenses and other liabilities 1,641,927 312,587
Deferred revenue   13,286   (3,200 )
Net cash used in operating activities (1,061,683 ) (1,566,413 )
 
Cash flows from investing activities:
Purchases of property and equipment   (45,581 )   -
Cash used in investing activities (45,581 ) -
 
Cash flows from financing activities:
Proceeds from notes payable 467,500 1,549,100
Repayment of note and warrant settlement (242,000 ) -
Proceeds from common stock and warrants   830,500   -
Net cash provided by financing activities 1,056,000 1,549,100
 
Net increase (decrease) in cash (51,264 ) (17,313 )
Cash at beginning of year   57,009   74,322
Cash at end of year $ 5,745 $ 57,009
 
Supplemental Cash Flow Information
Cash Paid for interest $ - $ 15,304
 


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