BEDFORD, Mass.--(BUSINESS WIRE)--Aug. 3,
2006--Cambridge Heart, Inc. (OTCBB-CAMH) today reported total revenue of $1,764,900 for
the quarter ended June 30, 2006, an increase of $582,000, or 49%, compared to total
revenue of $1,182,900 for the same period in 2005. Sequentially, total revenue increased
$345,900, or 24%, from the $1,419,000 in revenue reported for the quarter ended March 31,
2006. The operating loss for the second quarter of 2006 was $642,500, a decrease of
$135,800, or 17%, compared to an operating loss of $778,300 for the same period in 2005.
The operating loss for the second quarter of 2006 included $87,000 in non-cash stock based
compensation expense for employees resulting from the adoption of SFAS123R. The net loss
for the quarter was $541,600 or $0.01 per share compared to a net loss of $410,700 or
$0.01 per share in the same period in 2005. The net loss for the 2005 period included a
non-cash gain of $321,100 related to a change in the value of the Company's Series B
warrants.The Company reported total revenue for the six months ended June 30, 2006 of
$3,183,900, an increase of $991,600 or 45% compared to total revenue of $2,192,300 for the
same period in 2005. The operating loss for the 2006 six month period was $1,287,700, a
decrease of $427,900 or 25% compared to an operating loss of $1,715,600 in the same period
last year. The operating loss for the 2006 six month period included $160,000 in non-cash
stock based compensation expense. The net loss for the six months ended June 30, 2006 was
$7,378,600, or $0.13 per share, compared to a net loss of $260,800 or $0.01 per share in
the same period in 2005. The net loss for the 2006 period included a non-cash charge of
$6,264,700 related to the change in value of Series B warrants, and the net loss for the
2005 period included a non-cash gain of $1,368,500, also related to a change in the value
of the Company's Series B warrants.
Revenue for the second quarter from the sale of the Company's Microvolt T-Wave
Alternans ("Alternans") products was $1,466,700, an increase of $581,100, or
66%, compared to $885,600 from the sale of such products in the same period in 2005.
Sequentially, quarterly revenue from the Company's Alternans products increased by
$372,700, or 34%, compared to revenue of $1,094,000 for the quarter ended March 31, 2006.
For the first six months of 2006, revenue from Alternans products was $2,560,800, an
increase of $985,100, or 63%, compared to revenue of $1,575,700 in the same period in
2005.
The Company's cash used by operations was $489,700, and $730,100, respectively, for the
three and six month periods ended June 30, 2006. Cash use is expected to increase in
future quarters as the Company continues to implement its sales and marketing expansion
plans throughout 2006 and 2007. The Company had cash and marketable securities of $8.5
million at June 30, 2006.
As of June 30, 2006, the Company had a total of 60.8 million shares of common stock
issued and outstanding and no shares of Series A or B Convertible Preferred Stock then
outstanding. In addition, at June 30, 2006, there were options and warrants outstanding to
purchase 8.6 million common equivalent shares.
"The second quarter was very satisfying for all of us." stated David
Chazanovitz, President and Chief Executive Officer of Cambridge Heart. "We made solid
progress on virtually all fronts including improved revenue, expanded reimbursement
coverage, growth in our sales force and greater exposure for our important technology via
two separate publications in The Journal of the American College of Cardiology."
Corporate Governance
Reflecting the Board of Director's continuing focus on corporate governance issues, the
Company also announced today that at its regularly scheduled meeting on August 1st it had
voted to separate the roles of Chairman of the Board and Chief Executive Officer, so that
one person could no longer hold both positions. Mr. Robert Khederian has been named as
Chairman of the Board of Directors. Mr. David Chazanovitz will continue to serve as a
member of the Board of Directors, as well as the Company's President and Chief Executive
Officer. Mr. Khederian is a major shareholder of Cambridge Heart who has been a director
since 2002 and the lead independent director since April 2005. Mr. Khederian is currently
Chairman of Belmont Capital Partners LLC, a venture capital firm he founded in 1996, and
is Chairman of Provident Corporate Finance LLC, a healthcare investment banking firm he
co-founded in 1998. From 1984 through 1996, Mr. Khederian served as Chairman and Founder
of Medical Specialties Group Inc, a nationwide distributor of medical supplies that was
acquired by Bain Capital in 1996. Mr. Khederian is also a director of Inverness Medical
Innovations, Inc., (AMEX - IMA), and a member of its Audit and Compensation committees.
Conference Call Information
The Company will hold a conference call at 4:30 PM. (Boston time) on Thursday, August
3rd to discuss the results for the 2006 second quarter. The conference call phone-in
number is 800.638.4930 (outside the U.S. 617.614.3944), passcode 69167547. Interested
parties may listen to a recording of the conference call at any time during the 48 hours
immediately following the call by dialing 888.286.8010 (outside the U.S. 617.801.6888) and
enter the passcode 33902108. This playback will begin approximately two hours after the
call ends. The conference call will also be available by webcast on the Company's web site
at www.cambridgeheart.com.
About Cambridge Heart
Cambridge Heart is engaged in the research, development and commercialization of
products for the non-invasive diagnosis of cardiac disease. Using innovative technologies,
the Company is addressing such key problems in cardiac diagnosis as the identification of
those at risk of sudden cardiac arrest. The Company's products incorporate its proprietary
technology, Microvolt T-Wave Alternans, and are the first diagnostic tools cleared by the
U.S. Food and Drug Administration to non-invasively measure microvolt levels of T-wave
alternans. The Company, founded in 1990, is based in Bedford, Massachusetts and is traded
on the OTCBB under the symbol CAMH. More information about Cambridge Heart can be found at
www.cambridgeheart.com. The Company also files regular reports with the U.S. Securities
and Exchange Commission which are available at no charge either through the Company or via
the Internet at www.EDGAR.gov.
About the Cambridge Heart Microvolt T-Wave Alternans Test
The Cambridge Heart Microvolt T-Wave Alternans Test measures extremely subtle
beat-to-beat fluctuations in a person's heartbeat called T-wave alternans. These tiny
heartbeat variations - measured at one millionth of a volt - can be detected in any
clinical setting where titration of the heart rate is possible. The test involves placing
proprietary sensors on a patient's chest, after which the Company's proprietary algorithms
assess the data and deliver the results in a format that can be easily understood by the
attending physician. Extensive clinical research has shown that patients with symptoms of
or, who are at risk of, life threatening arrhythmias who test positive for T-wave
alternans are at significant risk for subsequent sudden cardiac events including sudden
death, while those who test negative are at minimal risk.
Statements contained in this press release about anticipated revenue growth, and all
other statements that are not purely historical, are forward-looking statements for
purposes of the safe harbor provisions under The Private Securities Litigation Reform Act
of 1995. In some cases, we use words such as "believes", "expects",
"anticipates", "plans", "estimates", "could" and
similar expressions that convey uncertainty of future events or outcomes to identify these
forward-looking statements. Actual results may differ materially from those indicated by
these forward-looking statements. Factors that may cause or contribute to such differences
include customer delays in making final buying decisions, decreased demand for our
products, failure to obtain funding necessary to develop or enhance our technology,
adverse results in future clinical studies of our technology, failure to obtain or
maintain patent protection for our technology, failure to obtain or maintain adequate
levels of third-party reimbursement for use of our products and other factors identified
in our most recent Annual Report on Form 10-K under "Factors Which May Affect Future
Results", which is on file with the SEC and available at www.EDGAR.com. In addition,
any forward-looking statements represent our estimates only as of today and should not be
relied upon as representing our estimates as of any subsequent date. While we may elect to
update forward-looking statements at some point in the future, we specifically disclaim
any obligation to do so except as may be legally necessary, even if our estimates should
change.
Cambridge Heart, Inc.
Financial Highlights
Statement of Three months ended Six months ended
Operations June 30, June 30,
-----------------------------------------------------
2006 2005 2006 2005
------------- ------------- ------------ ------------
Revenues $ 1,764,879 $ 1,182,862 $ 3,183,899 $ 2,192,345
Cost of goods
sold 721,689 545,848 1,320,895 1,025,696
------------- ------------- ------------ ------------
Gross
Profit 1,043,190 637,014 1,863,004 1,166,649
Costs and
expenses
Research and
development 104,518 176,631 262,270 389,408
Selling, general
and
administrative 1,581,172 1,238,646 2,888,481 2,492,813
------------- ------------- ------------ ------------
Total
Operating
Expenses 1,685,690 1,415,277 3,150,751 2,882,221
Loss from
operations (642,500) (778,263) (1,287,747) (1,715,572)
Interest income 100,955 46,392 173,916 86,368
Change in
valuation
of Series B
warrants - 321,149 (6,264,727) 1,368,450
------------- ------------ ------------ -----------
Net Loss $ (541,545) $ (410,722) $(7,378,558) $ (260,754)
============= ============= ============ ============
Net Loss
attributable
to common
shareholders $ (541,545) $ (410,722) $(7,378,558) $ (260,754)
============= ============= ============ ============
Net loss per
common share -
basic and
diluted $ (0.01) $ (0.01) $ (0.13) $ (0.01)
============= ============= ============ ============
Weighted average
shares
outstanding -
basic and
diluted 60,593,316 39,687,315 57,502,905 38,651,897
============= ============= ============ ============
Balance Sheet June 30, December 31,
2006 2005
------------- -------------
Assets
--------
Cash & Marketable
Securities $ 8,519,396 $ 5,297,834
Accounts
receivable, net 1,419,875 1,018,988
Inventory 427,303 419,938
Other prepaid
assets 67,618 79,843
------------- -------------
Total current
assets 10,434,192 6,816,603
Fixed assets, net 73,961 85,771
Other assets 96,155 112,182
------------- -------------
$ 10,604,308 $ 7,014,556
============= =============
Liabilities and
stockholders' equity
----------------------
Accounts payable and
accrued expenses $ 1,160,516 $ 774,185
Debt, current
portion 526 1,577
------------- -------------
Total current
liabilities 1,161,042 775,762
Debt, long-term
portion - 0
Series B warrant
liability - 1,503,646
------------- -------------
Total
liabilities $ 1,161,042 $ 2,279,408
------------- -------------
Convertible
Preferred 0 1,504,287
Warrants to acquire
Convertible Preferred
Stock 462,317 743,440
------------- -------------
$ 462,317 $ 2,247,727
------------- -------------
Stockholders' equity
Common stock $ 60,810 $ 46,301
Additional paid-in-
capital 75,093,871 61,236,294
Accumulated deficit (66,173,732) (58,795,174)
------------- -------------
Total stockholders'
equity 8,980,949 2,487,421
------------- -------------
$ 10,604,308 $ 7,014,556
============= =============
CONTACT: At Cambridge Heart, Inc.
Roderick de Greef, 781-271-1200 x231
Chief Financial Officer
roderickd@cambridgeheart.com
or
At Consulting for Strategic Growth
Stanley Wunderlich, 800-625-2236
info@cfsg1.com
SOURCE: Cambridge Heart, Inc.
