Brian Marckx, CFA
Q2 2011 Financial Results
Vicor Technologies, Inc (VCRT) filed its 10-Q for the second quarter ending June 30, 2011 on August 22nd. Revenue of $139k came in lower than our $279 estimate. However, gross margin held up strong at 48% compared to our 47% estimate.
Q2 EPS was ($0.00) compared to our ($0.01) estimate. The majority of the difference due to a larger than anticipated gain related to valuation of embedded derivatives in the company's various financial instruments.
Cash used in operations was $430k and $1,363k in the three and six months ending 6/30/2011. Cash balance at quarter-end stood at $26k. In late July Vicor entered into a financing deal with Centaurian Fund whereby Vicor can sell up to $10 million in stock to Centaurian over the next three years. With the registration statement now effective, Vicor can begin selling shares to Centaurian. In regard to liquidity, Vicor's Q2 10-Q notes that, "We anticipate various short-term financings over the next 3 – 5 months to provide liquidity in anticipation of a more significant financing event. These include short-term borrowings and sales of equity."
Financing Deal
In a July 26th 8-K filing Vicor noted that it entered into a financing deal with Centaurian Fund whereby Centaurian will be obligated to purchase up to $10MM (although this will be limited to $2.1MM initially) in Vicor common stock over a three year period. Vicor filed a registration statement with the SEC covering up to 15.1MM shares (~$2.1MM worth) which became effective on August 10, 2011. The arrangement allows Vicor to make cash draws once every 7 days. The price per share that Centaurian will pay includes a 7% discount to market price.
Vicor notes in the filing that they expect to limit themselves to $2.1MM and may file a registration statement for the remainder ($7.9MM which represents ~72MM shares at the current share market price) if their share price rises.
ZOLL Medical Agreement
More good news came across the wire in late July when Vicor announced a "licensing and development agreement" with ZOLL Medical (NASDAQ:ZOLL). The agreement allows Zoll to use Vicor's PD2i algorithm (the brains behind the company's PD2i Analyzer) in Zoll's existing and future products. Zoll is a heavyweight in resuscitation devices and makes the only wearable automatic defibrillator, called LifeVest.
While the 8-K was light on specific terms of the deal, it is clearly a very positive sign that a company of Zoll's caliber within resuscitation is interested in PD2i.
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