VYCO 8-K
Vycor Medical Inc (VYCO)
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT
TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): March 23, 2020
Vycor Medical, Inc.
(Exact Name of Registrant as Specified in its Charter)
| Delaware | 001-34932 | 20-3369218 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File No.) |
(I.R.S. Employer Identification No.) |
| 951 Broken Sound Parkway, Suite 320, Boca Raton, FL | 33487 | |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code: (561) 558-2020
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||
| Common Stock | VYCO | OTCQB |
TABLE OF CONTENTS
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements with Certain Officers
At its March 23, 2020 meeting the Company’s Board of Directors accepted the tendered resignation as Director of Oscar Bronsther, M.D., with effect from July 1, 2020, expressing appreciation for his years of service. There were no disagreements between the Company and Mr. Bronsther on any matters.
Item 2.02. Results of Operations and Financial Conditions
The information in this report and the exhibit attached hereto are being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall they be deemed incorporated by reference in any filing with the Securities and Exchange Commission under the Securities Act of 1934 or the Securities Act of 1933, except as shall be expressly set forth by specific reference to such filing.
On March 27, 2020, we issued a press release regarding our financial results for the year ended December 31, 2019. A copy of the press release is furnished as Exhibit 99.1 to this Form 8-K.
Non-GAAP Measures
We make reference to non-GAAP financial information in this press release together with a reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures. Specifically, we have provided non-GAAP Cash Operating Expenses and non-GAAP Cash Operating Loss measures that exclude Depreciation, Amortization and non-cash Stock Compensation.
We believe that these non-GAAP financial measures provide investors with insight into what is used by management to conduct a more meaningful and consistent comparison of our ongoing operating results and trends, compared with historical results. This presentation is also consistent with the measures management uses to measure the performance of ongoing operating results against prior periods and against our internally developed targets. There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP and the reconciliation of non-GAAP financial measures in this press release.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit 99.1. | Vycor Medical, Inc. Press Release dated March 27, 2020. |
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Vycor Medical, Inc. | ||
| By: | /s/ Peter C. Zachariou | |
| Name: | Peter C. Zachariou | |
| Title: | Chief Executive Officer | |
| Dated: | March 27, 2020 | |
Vycor Medical Reports Financial Results for the year ended December 31st, 2019
BOCA RATON, FL (March 27, 2020) – Vycor Medical, Inc. (Vycor) (OTCQB: VYCO), a provider of innovative and superior surgical and therapeutic solutions, reported financial results for the year ended December 31, 2019.
Highlights
| ● | The Vycor Medical division recorded revenue of $1,300,000 from the sale of its products for the year ended December 31, 2019, a decrease of $11,000 (or 1%) over 2018. The US continued to experience growth (increase of 28%), primarily as a result of greater adoption and usage following the introduction of the enhanced VBAS model in September 2017, however this was offset by two large international orders in the 2018 period which were not repeated during 2019. Gross margin was 90% compared with 88% in 2018. | |
| ● | Operating expenses for the year were $2,060,000, a reduction of $597,000 or 22% compared to 2018, despite a significant increase in regulatory fees due to the migration to a new EU Notified Body for VBAS and despite increased patent fees due to the filing of 8 new patents for VBAS during the year. Operating loss was $725,000 compared to $1,318,000, a reduction of 45%, and Cash Operating Loss1 was $121,000 compared to $207,000, a reduction of 42%. Net Loss for the year was $796,000 as compared to $1,379,000 in 2018. | |
| ● | A new large-scale clinical study done by the University of Aberdeen and [the Stroke Division at] the University of Miami Miller School of Medicine has been published in the highly respected scientific journal Cortex. The study reports on the effectiveness of NeuroEyeCoach, one of NovaVision’s treatments for patients with blindness associated with brain injury. This is the largest study done to date in the neuro-visual space and analyses the results of approximately 300 patients who underwent the therapy. The study demonstrates that patients achieve major improvements within 2-3 weeks and that NeuroEyeCoach is a highly effective clinical intervention. The findings showed that 87% of patients improved in search time and 80% had made less errors leading to a significant improvement in their ability to deal with their activities of daily living. In fact, patients with significant pre-therapy disability scores benefited the most with 79% of these patients saying they had less disability following the treatment. | |
| ● | Under Vycor’s ownership, NovaVision has gone from a business with a prototype therapy to one with a broad suite of proven patient and professional therapies and diagnostic products, utilizing a flexible range of delivery technologies, which this recent study demonstrates. The therapies are protected by 38 patents and have a significant body of clinical data that demonstrates their efficacy. Management has made clear however that, given the company’s resources and the large size and diversity of NovaVision’s end markets, it believes the most efficient way to fulfill NovaVision’s potential is through partnerships. The range of alternatives for NovaVision could comprise distribution and marketing partnerships, licensing, merger, sale and/or a significant restructuring of its activities. |
1 Operating Profit/Loss before Depreciation, Amortization and non-cash Stock Compensation. See Reconciliation table
COVID-19
In December 2019, an outbreak of a novel strain of coronavirus (COVID-19) originated in Wuhan, China, and has since spread to a number of other countries, including the United States. On March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. In addition, as of the time of the filing of this Annual Report on Form 10-K, several states in the United States have declared states of emergency, and several countries around the world, including the United States, have taken steps to restrict travel. Although neurosurgery is not generally an elective procedure, general hospital dislocation and diversion of resources could impact our revenues. We have implemented business continuity plans for our offices and personnel to enable continuity of service remotely however, if a critical number of our employees become too ill to work, or we are not able to access a sufficient quantity of our inventory for shipment due to enforced office closures, our production ability could be materially adversely affected in a rapid manner. While our operations are principally located in the United States, and our sub-contract manufacturers are located in the United States, we participate in a global supply chain. Disruptions to our supply chain and business operations, or to our suppliers’ or customers’ supply chains and business operations, could have adverse ripple effects on our manufacturing output and delivery schedule. Any of these and other uncertainties resulting from COVID-19 could have a material adverse effect on our business, financial condition or results of operations.
About Vycor Medical, Inc.
Vycor Medical (OTCQB: VYCO) is dedicated to providing the medical community with innovative and superior surgical and therapeutic solutions. The company has a portfolio of FDA cleared medical solutions that are changing and improving lives every day. The company operates two business units: Vycor Medical and NovaVision, both of which adopt a minimally or non-invasive approach.
For the latest information on the company, including media and other coverage, and to learn more, please go online at www.vycormedical.com, www.vycorvbas.com or www.novavision.com.
Non-GAAP Measures
We make reference to non-GAAP financial information in this press release together with a reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures. Specifically, we have provided non-GAAP Cash Operating Expenses and non-GAAP Cash Operating Loss measures that exclude Depreciation, Amortization and non-cash Stock Compensation.
We believe that these non-GAAP financial measures provide investors with insight into what is used by management to conduct a more meaningful and consistent comparison of our ongoing operating results and trends, compared with historical results. This presentation is also consistent with the measures management uses to measure the performance of ongoing operating results against prior periods and against our internally developed targets. There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP and the reconciliation of non-GAAP financial measures in this press release.
Safe Harbor Statement
Information in this document constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words “forecast”, “anticipate”, “estimate”, “project”, “intend”, “expect”, “should”, “believe”, and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve, and are subject to known and unknown risks, uncertainties and other factors which could cause Vycor Medical’s actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward-looking statements. The risks, uncertainties and other factors are more fully discussed in Vycor Medical’s filings with the U.S. Securities and Exchange Commission. All forward-looking statements attributable to Vycor Medical herein are expressly qualified in their entirety by the above-mentioned cautionary statement. Vycor Medical disclaims any obligation to update forward-looking statements contained in this estimate, except as may be required by law.
VYCOR
MEDICAL, INC.
Consolidated Statements of Comprehensive Loss
| For the year ended December 31, | ||||||||
| 2019 | 2018 | |||||||
| Revenue | $ | 1,481,751 | $ | 1,509,330 | ||||
| Cost of Goods Sold | 146,656 | 169,598 | ||||||
| Gross Profit | 1,335,095 | 1,339,732 | ||||||
| Operating expenses: | ||||||||
| Depreciation and Amortization | 60,033 | 166,386 | ||||||
| Selling, general and administrative | 2,000,191 | 2,183,505 | ||||||
| Impairment of assets | - | 307,576 | ||||||
| Total Operating expenses | 2,060,224 | 2,657,467 | ||||||
| Operating loss | (725,129 | ) | (1,317,735 | ) | ||||
| Other income (expense) | ||||||||
| Interest expense: Other | (48,036 | ) | (48,800 | ) | ||||
| Interest expense: Related Party | (20,647 | ) | (11,434 | ) | ||||
| Gain (loss) on foreign currency exchange | (2,390 | ) | (1,387 | ) | ||||
| Total Other Income (expense) | (71,073 | ) | (61,621 | ) | ||||
| Loss Before Credit for Income Taxes | (796,202 | ) | (1,379,356 | ) | ||||
| Credit for income taxes | - | - | ||||||
| Net Loss | (796,202 | ) | (1,379,356 | ) | ||||
| Preferred stock dividends | (324,370 | ) | (324,370 | ) | ||||
| Net Loss available to common shareholders | (1,120,572 | ) | (1,703,726 | ) | ||||
| Comprehensive Loss | ||||||||
| Foreign Currency Translation Adjustment | 3 | (128,156 | ) | |||||
| Comprehensive Loss | (796,198 | ) | (1,507,511 | ) | ||||
| Net Loss Per Share | ||||||||
| Basic and diluted | $ | (0.05 | ) | $ | (0.08 | ) | ||
| Weighted Average Number of Shares Outstanding – Basic and Diluted | 23,958,999 | 21,599,118 | ||||||
Reconciliation
of Cash Operating Expenses and Cash Operating Loss Before
Depreciation, Amortization and Other Non-Cash Items
| For the twelve months ended December 31, | ||||||||
| 2019 | 2018 | |||||||
| GAAP Operating Expenses | (2,060,224 | ) | (2,657,467 | ) | ||||
| Non-cash depreciation | 57,274 | 127,020 | ||||||
| Non-cash amortization of intangible assets | 12,164 | 50,331 | ||||||
| Non-cash stock-based compensation | 534,940 | 625,625 | ||||||
| Impairment of assets | - | 307,576 | ||||||
| Non GAAP Cash Operating Expenses | (1,455,846 | ) | (1,546,915 | ) | ||||
| GAAP Operating Loss | (725,129 | ) | (1,317,735 | ) | ||||
| Non-cash depreciation | 57,274 | 127,020 | ||||||
| Non-cash amortization of intangible assets | 12,164 | 50,331 | ||||||
| Non-cash stock-based compensation | 534,940 | 625,625 | ||||||
| Impairment of assets | - | 307,576 | ||||||
| Non GAAP Operating loss Before | ||||||||
| Depreciation and Amortization | (120,751 | ) | (207,183 | ) | ||||
Vycor Medical, Inc. contacts:
951 Broken Sound Parkway NW
Suite 320
Boca Raton, FL. 33487
(561) 558-2020