DRAPER, Utah, May 20, 2019 /PRNewswire/ — Flexpoint Sensor Systems, Inc. (FLXT) today announced the company’s financial results for the first quarter ended March 31, 2019.
Q1 Financial Results for the three months ended March 31, 2019
– Of the $220,693 and $224,615 total operating costs and expense for the three months ending March 31, 2019 and 2018, respectively, $79,152 and $81,877 were for direct research and development cost, respectively. For the three months ended March 31, 2019, total operating expenses decreased by $3,922 when compared to the same period in 2018, due primarily to a reduction in cost of revenue.
Other expense for the three month period ended March 31, 2019 was $110,724, a $68,595 increase compared to the same period in 2018. The increase is attributable to a loss on the change in fair value of derivative liabilities, offset in part by lower interest expense.
A net loss of $266,822 was realized for the three months ended March 31, 2019. A net loss of $103,222 was realized for the three month period ended March 31, 2018.
Cash and cash equivalents decreased by $8,650 at March 31, 2019 compared to December 31, 2018. The decrease in cash is due to the timing of payment of expenses, collection of accounts receivable and proceeds from borrowings. Our non-current assets decreased at March 31, 2019 due to the amortization of long-lived assets.
Total liabilities increased by $249,473 at March 31, 2019. The increase was due primarily to the funding of operations through the issuance of convertible notes payable, the accrued interest related to those notes, accruals for investor relations and insurance expenses and an increase in the derivate liability.
First quarter highlights
On October 18, 2018, the Company announced it had signed a five year manufacturing and supply agreement with Counted LLC. Counted LLC conceived of a medication delivery monitoring system and dispensing monitoring system. Flexpoint designed and produced the monitoring system with Flexpoint features, Flexpoint technology and Flexpoint designed electronics to track and report the dispensing of medications in real time. The information has the potential to be transmitted to physicians, pharmacists and government agencies. Prototypes have been built and successfully tested with additional production and testing continuing through the first quarter of 2019. The Company expects that commercial production will begin in the late second or third quarter of 2019, increasing throughout 2019 and beyond.
For the three months ending March 31, 2019 revenue was $64,595, a decrease of $14,669 when compared to the same period in 2018. The majority of the revenue for this period came from product manufacturing and recurring sales with additional contributions to income from development engineering, prototype and pre-production products. The Company continues to concentrate its marketing resources on a limited number of customers that have the greatest potential to generate the most short-term revenue while still building relationships with our larger customers.
Management believes this approach has the highest potential to bring long-term commercially viable products to market and will provide sustainable cash flow to fund the Company’s operations in the future. Currently, overall revenues are not sufficient to sustain our operations. Management anticipates that revenues will increase as we continue to execute our long-term business plan and cultivate larger customer bases with our existing product offering. However, until a long-term production contract is in place there is no guarantee that our current customer base will order in sufficient volumes to sustain our operations. Therefore, management continues to work with larger companies and industries and is hopeful that in the near future we will sign a long-term licensing or manufacturing contract.
We received revenue from repeat orders from our existing customers, design contract, and development engineering. Revenue is recognized using the ASC 606 five step detailed in Note 1 to the financial statements. Revenue from the sale of a product is recorded at the time of shipment to the customer. Revenue from research and development engineering contracts is recognized as the services are provided and accepted by the customer. Revenue from contracts to license technology to others is deferred until all conditions under the contract are met and then the sale is recognized as licensing royalty revenue over the remaining term of the contract.
Clark Mower, Flexpoint President stated, “It is exciting to see the majority of our income being generated from production and recurring sales. We expect this trend to continue at an ever increasing rate as we move forward.”
For a full earnings report please view our entire filing at www.sec.gov.
Please visit http://www.flexpoint.com/ for more information.
About Flexpoint Sensor Systems, Inc.
Flexpoint Sensor Systems, Inc. (FLXT) is an innovative technology firm specializing in developing products that feature the Company’s patented Bend Sensor® and related technology. The Bend Sensor® is a groundbreaking, differentiated sensing solution that is revolutionizing applications in the VR/AR, wearable, IoT, automotive, safety, medical and industrial industries. The Bend Sensor’s single-layer, thin film construction cuts costs and mechanical bulk while introducing a range of functions and stylistic design possibilities that have never before been available in sensing technology. Flexpoint’s technology and expertise have been recognized by the world’s elite business and academic innovators for over 17 years. The company is setting a new standard for sensing solutions in the “smart” age of technology.
This press release contains certain forward-looking statements. Investors are cautioned that certain statements in this release are “forward-looking statements” and involve both known and unknown risks, uncertainties and other factors. Such uncertainties include, among others, certain risks associated with the operation of the company described above. The Company’s actual results could differ materially from expected results.
Flexpoint Sensor Systems Clark Mower, President 801-568-5111
Brokers and Analysts Chesapeake Group 410-825-3930
View original content:http://www.prnewswire.com/news-releases/flexpoint-sensor-systems-announces-q1-2019-results-and-anticipates-significant-purchase-orders-late-second-quarter-early-third-quarter-300852893.html
SOURCE Flexpoint Sensor Systems, Inc.