ROCHESTER, N.Y., May 15, 2012 /PRNewswire/ -- VirtualScopics, Inc. (NASDAQ: VSCP), a leading provider of quantitative imaging, today reported revenues for the first quarter of 2012 reached $3,702,159 compared to revenues of $3,658,977 in the first quarter of 2011. Gross profit for the quarter ended March 31, 2012 was $1,410,914 compared to $1,599,740 during the first quarter of 2011. Earnings before interest, taxes, depreciation and amortization, and excluding stock compensation expense and the unrealized loss on change in fair value of the derivative liabilities ("Adjusted EBITDA") was $82,106 for the quarter ended March 31, 2012 compared to $392,942 for the quarter ended March 31, 2011. Net loss for the first quarter of 2012 was $613,544 compared to $200,381 in the first quarter of 2011.
"The first quarter of 2012 was one of the most active quarters in the company's history in terms of image processing," said Jeff Markin, president and chief executive officer of VirtualScopics. "We received a record level of images from study sites and our core lab outpaced any previous quarter. The slowdown in revenue growth and our product mix, however, resulted in lower gross margins than we've reported in prior quarters." He added, "This underscores the importance of our focus on sales initiatives. Specifically of note, our business development team received a robust number of requests for proposals (RFPs) during the first quarter. Additionally, we are pleased to announce that RFP activity from our PPD alliance resulted in a more than doubling of requests when compared to the first quarter of 2011. This activity directly relates to the expansion of our strategic alliance with PPD announced earlier in the quarter." He concluded, "We are encouraged by the level of activity we are seeing in the market and we are diligently working towards achievement of our 2012 goals."
"With the support of an important strategic investment this year, we continue to make progress in the further development of our personalized medicine software applications," stated Molly Henderson, chief business and financial officer of VirtualScopics. She added, "The proceeds of this recent financing will enable us to develop our quantitative imaging solutions for the broader medical community which we believe will enable improved patient care." She concluded, "With this investment and our strong cash position, we are well-poised to take advantage of opportunities that we believe will be an integral part of the future success of the company."
Jeff Markin and Molly Henderson will provide a business and first quarter 2012 financial update during the conference call today at 11:00 a.m. ET. Interested participants should call 877.407.8035 when calling within the United States or +1 201 689 8035 when calling internationally. This call can also be accessed at www.virtualscopics.com and will be available for 30 days after the call.
The Company provides Adjusted EBITDA as a supplemental measure to GAAP regarding the Company's operational performance. The Company defines Adjusted EBITDA as earnings less interest, taxes (if any), depreciation and amortization and further adjusted to exclude stock compensation expense and the unrealized loss on the change in fair value of derivative liabilities (mark to market adjustment for warrants). This financial measure excludes the impact of certain items and, therefore, has not been calculated in accordance with GAAP. The Company's method of calculating Adjusted EBITDA, however, may differ from methods used by other companies, and, as a result, Adjusted EBITDA measures disclosed herein may not be comparable to other similarly titled measures used by other companies. The Company continues to provide information in accordance with GAAP. However, with the adoption of ASC 815-40 and the non-cash variable nature of stock compensation expense and their very substantial impact on the overall reported net income/loss, the Company believes it is also helpful for investors to receive additional information relating more specifically to the Company's operating results. Accordingly, the Company has presented Adjusted EBITDA which excludes the non-cash effects of ASC 815-40 and ASC 718 on its financial results. Management uses Adjusted EBITDA (a) to evaluate the Company's financial performance, (b) to set internal spending budgets, and (c) to measure operational profitability. In addition, investors have requested these non-GAAP financial measures as a means of providing consistent and comparable information with past reports of financial results. Pursuant to the requirements of Regulation G, the Company has provided a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure, net (loss)/income.
About VirtualScopics, Inc.
VirtualScopics, Inc. is a leading provider of quantitative imaging solutions to accelerate drug and medical device development in addition to improving patient care. VirtualScopics has developed a robust software platform for analysis and modeling of both structural and functional medical images. In combination with VirtualScopics' industry-leading experience and expertise in advanced imaging biomarker measurement, this platform provides a uniquely clear window into the biological activity of drugs and devices in clinical trial patients, allowing sponsors to make better decisions faster. For more information about VirtualScopics, visit www.virtualscopics.com.