INTERIM REPORT JANUARY 1 - MARCH 31, 2010
(NGM: BIOL MTF)
The Board and President of Biolight AB herewith present the interim report for the first quarter 2010.
• Sales for the first quarter were SEK 1,787 thousand (773).
• Net operating loss for the first quarter was SEK -2,007 thousand (-2,551).
• Loss per share was SEK -0.11 (-0.26), and SEK -0.11 (-0.26) after full dilution.
• Sales include the first quarter’s invoiced amount for Carema.
• A new share issue was completed in March. It was oversubscribed, providing the Company with SEK 4.3 million before issue expenses.
Net sales
Sales in the first three months of the year were SEK 1,787 thousand (773).
This year’s sales include the first quarter’s invoiced amount for Carema Care AB, in accordance with the two-year contract that was signed during the autumn of 2009 and which became effective on January 1, 2010. Sales in the equine sports market continue to grow. After a slow start in January and February, which are normally slow months in equine sports, we witnessed record sales for a single month in March.
The wound care market
In the business area Wound Care, we signed a collaboration agreement with the health care provider Carema Omsorg AB during the third quarter 2009 which started generating revenue in January 2010. This agreement, which is the Company’s largest deal to date and which will lead to Carema implementing Biolight’s method at all of its homes for the elderly, is worth at least SEK 2.5 million per year during the next two years.
During the fourth quarter of 2009, we delivered equipment to Carema, while we installed this equipment and trained their personnel during January and February of this year. Most of their care units have now started using our treatment for slow-healing wounds. We continue to give high priority to assuring that the Biolight method works everywhere within Carema’s organization. The parties have agreed to carry out various quality assurance follow-up projects and these are now in the process of being implemented. The aim of these projects is to gather concrete proof of the competitive advantages that can be achieved through treatment with Biolight. You can read more about Biolight’s collaboration with Carema at www.biolight-wound.se.
The use of Biolight in the treatment of sores in public geriatric care is most firmly established in Northwest Skåne, especially in Ängelholm. Biolight’s treatment method is regularly used to treat slow-healing sores at both the municipality’s health care centres and at the regional hospital. Over the last couple of years, the municipality has documented more than 100 separate cases. The reports indicate exceptionally quick healing of various wounds treated with Biolight®. In co-operation with the geriatric care providers in Ängelholm, the Company is now preparing information material whose object is to demonstrate the quality advantages of the treatment.
The clinical phase III study on the treatment of diabetic foot wounds, carried out in co-operation with a number of leading clinics in this field, is expected to continue throughout 2010 and be completed in 2011.
More than 1,000 Swedes are forced to undergo amputations each year due to diabetic foot wounds. The total costs involved are estimated at over one billion SEK. Significantly faster healing should reduce the risk of amputations. Should the results of this large clinical phase III study prove to be in line with earlier smaller studies, a focused effort on diabetes care will be initiated.
The equine sports market
Sales on the Swedish equine sports market continue to grow and we see good prospects for continued sales growth in the coming years. During the summer and autumn of 2009, Biolight boosted its sales resources on the equine sports market from one to four people. After a few months’ training and acclimatisation, these new salespeoples’ contribution to our sales is growing.
As more and more satisfied customers spread the word about the positive effects of the treatment, our sales process becomes easier and quicker. More and more leading profiles in this sport are participating in our advertising campaigns.
We are convinced that the equine sports market is interesting in the long term and promises healthy prospects for growth and profitability. The Swedish market alone is comprised of thousands of actors that could reap significant benefits by implementing Biolight in their operations, such as faster healing of wounds and lower costs.
Biolight users have experienced that the treatment reduces the risk of many common injuries, shortens the healing time in connection with injuries and speeds up recovery after physical exertion. Read what Royne Zetterman, one of Sweden’s most well-known horse trainers, has to say about the method at www.biolight-horses.se. Here, you will also find a film clip and hear Royne Zetterman tell us how he uses Biolight. Team Zetterman includes two national team horse-jumping riders. The team is also well-known for having trained top horses for the international horse-jumping elite for many years.
The beauty market
The Company is conducting a development/evaluation project with the aim of offering solutions for the beauty market. This project will continue throughout 2010.
Method and products
Biolight® is based on a patented light therapy that assists the body’s own healing of inflammatory conditions. The treatment instrument consists of a portable device, the size of a person’s palm, equipped with light-emitting diodes. The various treatments are provided through copy- and patent-protected Biolight® Biocards (smart cards) inserted in the treatment equipment.
Faster healing, improved quality of care and reduced costs
Long and difficult healing processes in connection with inflammatory conditions or wounds are both costly and painful. Biolight® is a unique treatment method, as it stimulates and speeds up the natural healing process of the body without any registered side effects. Clinical studies show, among other things, that the healing time for pressure sores is reduced by approximately fifty per cent, compared to the best conventional treatment method.
Financing
Within the authority voted by the Extraordinary General Meeting in January 2010, the Board of Directors resolved to carry out a new share issue of a total maximum of 3,191,061 shares with preferential rights to current shareholders. This new share issue was carried out within the framework of our previously decided EU issue, with a share value limit of 1 million euros during a running twelve-month period, a cost-effective way to provide capital for the Company. The subscription price was set at SEK 1.35 per share. The new share issue was over-subscribed.
Through this new issue the share capital in the company increased by SEK 191,463.66, to a total of SEK 1,340,245.62. After the issue the number of shares amounts to 22,337,427. The new issue provided the company with approximately SEK 4.3 million before issue expenses.
The company has now entered a commercial phase with steady sales growth and a steady increase in the number of clients. In our present development phase, we are consistently motivated to increase our marketing and sales investments. We have identified the need to raise more capital in order to fund our aggressive marketing investments.
Accounting principles
The same accounting principles and methods of valuation as were used in our last annual report have been applied in this interim report, which has been prepared in accordance with IAS 34, Interim Financial Reporting, and RR31, Interim Reporting for Groups. Biolight applies the accounting rules implemented by the International Financial Reporting Standards (IFRS, formerly IAS) for the consolidated accounts.
Consolidated accounts
The consolidated accounts include the Parent Company and the wholly-owned subsidiary Biolight Patent Holding AB. No intra-group sales have occurred.
Result, cash flow and liquidity
Sales in the first three months of the year were SEK 1,787 thousand (773). Operating expenses were SEK 3,794 thousand (3,324). The operating loss before depreciation was SEK -1,991 thousand ( 2,538). The result of the period showed a loss of SEK ¬-2,011 thousand (-2,522).
Investments in the period totalled SEK 0 thousand (0).
Liquid assets as of March 31, 2010 were SEK 5,222 thousand (5,860). As of December 31, 2009, liquid assets amounted to SEK 2,411 thousand.
(For complete report, see attached file)