CASMED Reports 2016 Fourth-Quarter and Full-Year Financial Results

FORE-SIGHT® disposable sensor sales increased 22% in 2016

2016 sales up 14% to $22.2 million

Conference Call Begins at 10:00 a.m. Eastern Time Today

BRANFORD, Conn., March 09, 2017 (GLOBE NEWSWIRE) -- CAS Medical Systems, Inc. (NASDAQ:CASM) (CASMED), a leader in medical products for non-invasive patient monitoring of tissue oxygenation, today reported financial results for the three and 12 months ended December 31, 2016.

Net sales from continuing operations for the fourth quarter of 2016 were $5.5 million, up 3% from $5.3 million for the fourth quarter of 2015. The Company incurred a net loss applicable to common stockholders for the fourth quarter of 2016 of $1.9 million, or $0.07 per share, compared with a net loss applicable to common stockholders for the fourth quarter of 2015 of $2.1 million, or $0.08 per share.

Highlights for the fourth quarter and full-year 2016 compared with their respective prior-year periods include the following:

  • Fourth-quarter FORE-SIGHT sales increased 4% and represented 81% of net sales.
  • Fourth-quarter FORE-SIGHT disposable sensor sales increased 15% and represented 74% of net sales.
  • For the full year, U.S. FORE-SIGHT sales increased 20%, driven by a 23% increase in FORE-SIGHT U.S. disposable sensor sales.
  • A net 88 FORE-SIGHT cerebral oximeters were shipped worldwide in the fourth quarter with a net 45 units shipped in the U.S. and a net 43 units shipped to international customers. Excluding returns, a record 82 units were shipped in the U.S.
  • The number of FORE-SIGHT cerebral oximeters shipped worldwide as of December 31, 2016, was 2,088, up 22% from December 31, 2015, and the U.S. installed base was 1,120, up 23% versus the prior year.
  • Gross profit margin in the fourth quarter improved to 58.2% from 51.6% in the prior-year period, driven by higher FORE-SIGHT sensor sales, lower costs, and improved manufacturing efficiencies, among other factors.
  • As of December 31, 2016, CASMED had cash, cash equivalents, and borrowings available under its line of credit of $7.6 million.

Management Commentary

“The financial results we are reporting today are consistent with the preliminary results we announced on January 10, 2017. Notably, U.S. FORE-SIGHT sensor sales growth of 16% for the fourth quarter marked our 27th consecutive quarter of double-digit domestic sensor growth over the prior year,” said Thomas M. Patton, President and Chief Executive Officer of CASMED. “For the year, U.S. sensor sales increased 23% and contributed to gross margin expansion throughout the year. Our domestic growth last year came from a mix of market share gains and market expansion as we continued to capture accounts from competitors, gained new ‘greenfield’ accounts that had not recently utilized a tissue oximetry product, and increased usage from hospitals that were already FORE-SIGHT customers. Most gratifying is that these results came in the midst of a complete overhaul and expansion of our U.S. selling organization, which is now nearly complete with 15 sales territories staffed and just two more open territories to fill.

We are expecting another year of growth in 2017 with total FORE-SIGHT sales increasing in the mid-teen percentages. This includes our outlook for a 20% increase in FORE-SIGHT sensor sales and a 20% increase in the U.S. installed base. We expect growth to accelerate in the second half of 2017 as our newer sales reps become more productive.”

Fourth-Quarter Financial Results

Net sales from continuing operations for the fourth quarter of 2016 increased 3% to $5.5 million, from $5.3 million for the fourth quarter of 2015. FORE-SIGHT oximetry sales increased 4% to $4.5 million, compared with the prior-year period. FORE-SIGHT disposable sensor sales increased 15% to $4.0 million, including 16% growth in FORE-SIGHT U.S. disposable sensor sales. Sales of non-invasive blood pressure product and services were $1.0 million, a 1% increase from the fourth quarter of 2015. FORE-SIGHT sales accounted for 81% of net sales from continuing operations for the fourth quarter of 2016.

The operating loss for the fourth quarter of 2016 was $1.1 million, an improvement of $0.7 million from the fourth quarter of 2015. Higher sales and gross profit and lower operating expenses were responsible for the improvement. Gross profit margin for the fourth quarter of 2016 increased to 58.2%, from 51.6% for the prior-year period, primarily due to a shift in product mix to FORE-SIGHT sensors, product cost reductions and manufacturing efficiencies. Operating expenses for the fourth quarter of 2016 decreased 7% to $4.3 million from the prior-year period, due to lower clinical research and marketing expenses.

Full-Year Financial Results

Net sales from continuing operations for 2016 increased 14% to $22.2 million from $19.5 million in 2015. FORE-SIGHT oximetry sales increased 17% to $18.0 million for 2016 and included a 22% increase in FORE-SIGHT disposable sensor sales to $15.9 million. Sales of non-invasive blood pressure product rose 3% in 2016 to $4.2 million.

The operating loss for 2016 was $4.9 million, an improvement of $1.7 million from 2015. The improvement was led by increased net sales and higher gross profit margin, which were slightly offset by a modest 2% increase in operating expenses. Gross profit margin for 2016 improved to 54.6% from 51.2% for 2015.

Income from discontinued operations for 2016 of $1.8 million included a gain of $2.9 million on the sale of the Company’s neonatal intensive care product assets in March of 2016, which was partially offset by losses from discontinued operations of $0.2 million during 2016 and $0.9 million of income tax expense. Income tax expense of $0.9 million associated with the sale of the product line was offset by a $0.9 million income tax benefit recorded against continuing operations. The Company does not expect to pay income taxes for 2016.

The Company recorded a net loss applicable to common stockholders for 2016 of $4.6 million, or $0.17 per common share, compared with a net loss applicable to common stockholders for 2015 of $8.3 million, or $0.32 per common share.

Cash and cash equivalents were $5.5 million as of December 31, 2016, compared with $7.5 million as of December 31, 2015. As of December 31, 2016, $2.1 million of borrowings were available under the Company’s line of credit.

Conference Call Information

CASMED will host a conference call beginning at 10:00 a.m. Eastern time today to discuss fourth- quarter and full-year 2016 results and answer questions. Conference call dial-in information is as follows:

  • U.S. callers: (866) 239-5859
  • International callers: (702) 495-1913

Individuals interested in listening to the live conference call via the Internet may do so by logging on to the Company's website at

A telephone replay will be available from 1:00 p.m. Eastern time on March 9, 2017, through 11:59 p.m. Eastern time on March 23, 2017. Replay dial-in information is as follows:

  • U.S. callers: (855) 859-2056
  • International callers: (404) 537-3406
  • Conference ID number (U.S. and international callers): 68572530
  • The replay will also be available at

About CASMED® – Monitoring What's Vital

CASMED products are designed to provide unique non-invasive monitoring solutions that are vital to patient care. The Company's FORE-SIGHT® Cerebral Oximeters provide a highly accurate, non-invasive measurement of tissue oxygenation in the brain. Direct monitoring of tissue oxygenation can provide a superior and powerful tool to alert clinicians to otherwise unrecognized and dangerously low levels of oxygen in the brain and empower them to improve patient care. In addition to FORE-SIGHT oximeters and accessories, the Company also provides proprietary non-invasive blood pressure monitoring solutions for OEM use. For further information regarding CASMED, visit the Company's website at

Statements included in this press release, which are not historical in nature, are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements relating to the future performance of the Company are subject to many factors including, but not limited to, the customer acceptance of the products in the market, the introduction of competitive products and product development, the impact of any product liability or other adverse litigation, working capital and availability of capital, commercialization and technological difficulties, the impact of actions and events involving key customers, vendors, lenders, competitors, and other risks detailed in the Company’s Form 10-K for the year ended December 31, 2015, and other subsequent Securities and Exchange Commission filings.

Such statements are based upon the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. When used in this press release, the terms "anticipate," "believe," "estimate," "expect," "may," "objective," "plan," "possible," "potential," "project," "will,” and similar expressions identify forward-looking statements. The forward-looking statements contained in this press release are made as of the date hereof, and we do not undertake any obligation to update any forward-looking statements, whether as a result of future events, new information, or otherwise.

(Tables to follow)

Three Months Ended Twelve Months Ended
Dec. 31, 2016 Dec. 31, 2015 Dec. 31, 2016 Dec. 31, 2015
Net sales from continuing operations$ 5,481,404 $ 5,310,170 $ 22,237,825 $ 19,486,570
Cost of sales 2,290,955 2,492,710 10,091,331 9,516,525
Gross profit 3,190,449 2,817,460 12,146,494 9,970,045
Operating expenses:
Research and development 764,438 930,259 3,436,618 3,514,362
Selling, general and administrative 3,517,890 3,661,567 13,575,219 13,097,167
Total operating expenses 4,282,328 4,591,826 17,011,837 16,611,529
Operating loss (1,091,879) (1,774,366) (4,865,343) (6,641,484)
Interest expense 262,764 210,617 1,048,207 859,372
Other income (8,949) (3,264) (42,521) (4,658)
Loss from continuing operations before income taxes (1,345,694) (1,981,719) (5,871,029) (7,496,198)
Income tax expense (benefit) 73,780 (66,993) (948,422) (209,197)
Loss from continuing operations (1,419,474) (1,914,726) (4,922,607) (7,287,001)
Discontinued operations
(Loss) income from discontinued operations (179,722) 215,528 (201,239) 621,826
(Loss) gain on sale of discontinued operations (31,079) (24,120) 2,911,016 (24,120)
Income tax (benefit) expense (73,780) 66,993 948,422 209,197
(Loss) income from discontinued operations (137,021) 124,415 1,761,355 388,509
Net loss (1,556,495) (1,790,311) (3,161,252) (6,898,492)
Preferred stock dividend accretion 380,350 354,850 1,482,595 1,383,200
Net loss applicable to common stockholders$ (1,936,845) $ (2,145,161) $ (4,643,847) $ (8,281,692)
Loss per common share from continuing
operations - basic and diluted$ (0.07) $ (0.09) $ (0.24) $ (0.34)
Income per common share from discontinued
operations - basic and diluted$ - $ 0.01 $ 0.07 $ 0.02
Per share basic and diluted net loss applicable
to common stockholders:$ (0.07) $ (0.08) $ (0.17) $ (0.32)
Weighted-average number of common
shares outstanding:
Basic and diluted 26,849,344 26,760,276 26,826,792 25,700,942

December 31, December 31,
2016 2015
Cash and cash equivalents $ 5,488,706 $ 7,528,292
Accounts receivable 3,322,400 2,921,720
Notes and other receivables 557,217 384,673
Inventories 1,595,668 1,428,425
Other current assets 322,148 364,444
Assets associated with discontinued operations 85,349 906,339
Total current assets 11,371,488 13,533,893
Property and equipment 8,827,604 8,406,649
Less accumulated depreciation (6,266,097) (6,173,823)
2,561,507 2,232,826
Intangible and other assets, net 790,971 813,017
Total assets $ 14,723,966 $ 16,579,736
Accounts payable $ 1,074,939 $ 1,459,798
Accrued expenses 2,239,985 1,833,502
Notes payable 70,015 82,377
Current portion of long-term debt, less unamortized debt issuance costs 840,471 2,616,992
Liabilities associated with discontinued operations 92,942 199,940
Total current liabilities 4,318,352 6,192,609
Deferred gain on sale and leaseback of property 91,603 226,240
Long-term debt, less current portion and unamortized debt issuance costs 6,580,851 4,207,629
Other long-term liabilities 320,000 300,000
Total liabilities 11,310,806 10,926,478
Series A convertible preferred stock 8,802,000 8,802,000
Series A exchangeable preferred stock 5,135,640 5,135,640
Common stock 109,715 109,567
Additional paid-in capital 30,557,093 29,636,087
Treasury stock (101,480) (101,480)
Accumulated deficit (41,089,808) (37,928,556)
Total stockholders' equity 3,413,160 5,653,258
Total liabilities & stockholders' equity$ 14,723,966 $ 16,579,736

Company Contact CAS Medical Systems, Inc. Jeffery A. Baird Chief Financial Officer (203) 315-6303 Investors LHA Bruce Voss / Jody Cain (310) 691-7100

Source:CAS Medical Systems, Inc.