MISSISSAUGA, ON, March 30, 2012 /PRNewswire/ - Mr. Brian Pedlar, President and
CEO of Covalon Technologies Ltd. (the "Company" or "Covalon") (TSXV:
COV), an advanced medical technologies company, is pleased to provide
the following update.
"Covalon is progressing well on its plan to transform into a market
driven medical products company. During our first fiscal 2012 quarter
ended December 31, 2011, we continued to build on our progress in
executing on our transformation plan in three key areas: expanding
wound care sales, establishing international distribution networks and
moving new products through the regulatory clearance process. While
these changes had only a modest impact on the financial operating
results for our first quarter, we are confident that the transformation
underway at Covalon will positively impact fiscal 2012 and beyond.
During the quarter ended December 31, 2011, Covalon recognized modest
revenue from shipments to five new wound care distribution partners. We
expect to sign additional new distribution partners in the coming
months, and expect the shipment volumes of wound care products to our
new distributors to increase both within North America and
internationally over time. During fiscal 2011, we announced that
Covalon recovered the exclusive worldwide rights to its advanced wound
care products from a major medical company that was only selling in one
limited market segment.
On October 13, 2011, Covalon announced a multi-year, non-exclusive
distribution arrangement with a China-based partner to distribute
ColActive® Plus Ag into the Chinese advanced wound care market. The
agreement calls for a minimum purchase commitment of $12 million of
ColActive® Plus Ag over the term of the agreement with a minimum
commitment of $500,000 in the first 12 months following regulatory
approval in China.
Our medical product development pipeline was strengthened during the
quarter, as four new products entered the final phase of development
and regulatory filing. This brings our total number of products in the
process of filing for regulatory clearances in multiple jurisdictions
to nine. Once cleared, these products will be made available through
licensing or distribution arrangements with existing and new
customers. Covalon continues to engage over sixty new companies in
confidential discussions to evaluate Covalon's products and
technologies for commercial licensing or use in development of new
Finally, Covalon is continuing to evaluate acquisition opportunities
that have the potential to significantly add capabilities and new
The Company announced financial results for its first quarter of fiscal
2012 ended December 31, 2011. Revenue for the quarter was $689,167.
Revenue was up marginally compared to the prior year's first quarter,
driven mainly by growth in our medical coating services revenue.
Quarterly operating expenses were $1,149,989 or an increase of $203,410
over the comparative period. Sales and marketing expenses accounted
for the increase year over year due primarily to investments made to
add additional sales and marketing staff and attendance at
sales-related trade shows.
Net loss was $800,054 or $0.01 per share. Covalon continues to have a
strong balance sheet with no long-term debt and over $4,400,000 in
cash, cash equivalents and short-term investments as of December 31,
Covalon's transformation is underway and I am confident the changes made
to date and continued operational improvements will translate into
improved financial results in fiscal 2012 and beyond", stated Brian
Pedlar, Covalon's President and CEO.
Covalon Technologies Ltd. researches, develops and commercializes new
healthcare technologies that help save lives around the world.
Covalon's patented technologies, products and services address the
advanced healthcare needs of medical device companies, healthcare
providers and individual consumers. Covalon's technologies are used to
prevent, detect and manage medical conditions in specialty areas such
as wound care, tissue repair, infection control, disease management,
medical device coatings and biocompatibility. To learn more about
Covalon, visit our website at www.covalon.com
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
This news release contains forward-looking statements which reflect the
Company's current expectations regarding future events. The
forward-looking statements are often, but not always, identified by the
use of words such as "seek", "anticipate", "plan, "estimate", "expect",
"intend" and statements that an event or result "may", "will",
"should", "could" or "might" occur or be achieved and other similar
expressions. These forward-looking statements involve risk and
uncertainties, including the difficulty in predicting product
approvals, acceptance of and demands for new products, the impact of
the products and pricing strategies of competitors, delays in
developing and launching new products, the regulatory environment,
fluctuations in operating results and other risks, any of which could
cause results, performance, or achievements to differ materially from
the results discussed or implied in the forward-looking statements.
Many risks are inherent in the industry; others are more specific to
the Company. Investors should consult the Company's ongoing quarterly
filings for additional information on risks and uncertainties relating
to these forward-looking statements. Investors should not place undue
reliance on any forward-looking statements. The Company assumes no
obligation to update or alter any forward-looking statements whether as
a result of new information, further events or otherwise.
SOURCE Covalon Technologies Ltd.