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EXHIBIT 99.1
Friday August 18, 4:51 pm Eastern Time
Press Release
SOURCE: Chromatics Color Sciences International, Inc.
Chromatics Color Sciences International Releases Second
Quarter Results
NEW YORK, Aug. 18 /PRNewswire/--Chromatics Color Sciences International, Inc.
(Nasdaq: CCSI-news) today announced its financial results for the second
quarter ending June 30, 2000.
Revenues for the quarter were $667,300, representing a $666,800 increase over
revenues reported in the comparable period in 1999. The Company incurred a net
loss of $2,959,100 (net loss of $0.20 per share) during the second quarter of
2000, compared to a net loss of $3,892,700 (net loss of $0.33 per share) during
the second quarter of 1999.
The company's increased revenues were primarily due to the acquisition of Gordon
Laboratories, Inc. The revenues of Gordon are included in the consolidated
financial statements of the Company from the date of acquisition (June 2,2000)
through June 30, 2000. The $933,600 decrease in net loss for the second quarter
of 2000 compared to the second quarter of 1999 is primarily attributable to the
revenue increase and a $1,177,800 decrease in interest expense and non-cash
financing costs, offset primarily by increases in cost of sales ($492,600),
mostly attributed to Gordon, research and development costs ($492,600), mostly
attributed to Gordon, research and development costs ($154,900) as the Company
continued the implementation of its long-term business plan to seek commercial
applications of its intellectual properties and technologies; and compensation
costs ($118,000) as the Company continued its efforts to add qualified executive
and senior level personnel to implement its business plan.
Consistent with the first quarter of 2000, no increase in revenues was realized
from the ColorMate(R) TLc-BillTest(R) Systems. The Company recognized revenues
from large initial shipments to its distribution partner, Datex-Ohmeda and its
Ohmeda Medical Division, in the fourth quarter of 1999, and these products
previously shipped to the distributor were sufficient to support the
distributor's launch in March of 2000 of the Company's products being marketed
across the U.S. and the resulting initial hospital placements of TLc-BiliTest(R)
monitors made through the end of the second quarter of 2000.
The Company also announced today that it has completed a financing for
$3,000,000 for the Company's stock at a price per share of $4.68. Additional
shares of common stock may be sold to the same investor for gross proceeds of
$1,000,000 upon the effectiveness of a registration statement filed by the
Company on behalf of such investor with the Securities and Exchange Commission.
In connection with the above transaction, the Company issued to the investor
150,000 warrants to be issued at the second closing. The purchase agreement
specifies certain conditions that may require the Company to issue additional
shares of its common stock to the investor.
Brian Fitzpatrick, President and Acting CEO, said, "This financing will provide
additional funds for the Company's new business plan, which included
commercializing its products in the beauty industry and other commercial
applications."
Chromatics Color Sciences is in the business of color science and has developed
technologies and intellectual properties in this field. The Company has received
clearance from the Food and Drug Administration (FDA) for the commercial use of
its medical device for the non-invasive monitoring of bilirubinemia in newborn
infants by healthcare professionals in hospitals, clinics, pediatrician offices
and the home environment. The Company believes its technologies and intellectual
properties may also have medical applications in the detection and monitoring of
other chromogenic diseases which the Company defines as those diagnosed or
monitored by the coloration of the human skin, tissue or fluid being affected.
Medical applications, in addition to the non-invasive monitoring of
bilirubinemia in newborns, will require additional clinical trials and FDA
clearances for commercial use. The Company's technologies and intellectual
properties also have other applications including the scientific color
measurement and classification of human skin and certain color-sensitive
consumer products, and in determining the color compatability of such skin and
product color classification for use in a variety of industries including the
cosmetic, beauty-aid and fashion industries.
Certain of the matters discussed in this announcement contain forward-looking
statements that involve material risks to and uncertainties in the Company's
business that may cause actual results to differ materially from those
anticipated by the statements made herein. Such risks and uncertainties
include, among other things, the availability of any needed financing, the
Company's ability to implement its long range business plan for various
applications for its technologies, the Company's ability to enter into
agreements with additional marketing and distribution partners, the impact of
competition, the obtaining and maintaining of any necessary regulatory
clearances applicable to applications of the Company's technology, management
of growth and other risks and uncertainties that may be detailed from time to
time in the Company's reports filed with the Securities and Exchange
Commission, including those set forth in its annual report on Form 10-K for
the year ended December 31, 1999 and on Form 10-Q for the quarter ended June
30, 2000.
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CHROMATICS COLOR SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
June 30, December 31,
2000 1999
(unaudited)
ASSETS
CURRENT ASSETS:
Cash and equivalents $1,865,600 $2,790,400
Accounts receivable-net 1,369,000 842,300
Inventories 2,358,200 1,171,800
Prepaid expenses and other current assets 265,600 129,200
Total Current Assets 5,858,900 4,933,700
PROPERTY AND EQUIPMENT - NET 1,483,400 612,200
SOFTWARE DEVELOPMENT COSTS - NET 366,000 470,500
PATENT COSTS - NET 1,164,100 984,000
GOODWILL NET 7,455,900 --
OTHER AMORTIZABLE ASSETS - NET 404,800 455,400
OTHER ASSETS 738,700 654,400
$17,471,300 $8,110,200
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Amounts payable to related party $243,300 $256,100
Current portion of notes payable 363,200 --
Due to Factor 531,500 --
Accounts payable and accrued expenses:
Attorneys and accountants 488,500 394,600
Consultants 41,800 119,100
Trade 1,087,100 240,000
Total Current Liabilities 2,755,400 1,009,800
LONG TERM DEBT:
Note payable, net of current portion 2,759,400 --
Senior convertible debentures 5,000,000 4,165,800
Accrued interest on senior
convertible debentures 845,800 495,800
Amounts payable for purchase of Gordon 653,000 --
9,258,200 4,661,600
COMMITMENTS AND CONTINGENCIES
REDEEMABLE PREFERRED STOCK:
Class A, Par Value $.01 per share:
Authorized - 1,400,000 shares
Issued and outstanding - 1,380,000 shares
at par value and redemption value 13,800 13,800
Class B, series 2 and 3 Convertible Preferred
Stock, No Par Value:
Authorized - 10,000,000 shares
Issued and outstanding - 65,000 and
40,000 shares in 2000 and 1999,
respectively - $115 redemption value 4,861,700 2,928,700
4,875,500 2,942,500
SHAREHOLDERS' EQUITY (DEFICIENCY)
Common Stock, par value $.001 per share:
Authorized - 50,000,000 shares
Issued and outstanding - 16,711,192 (2000)
and 15, 539,117 (1999) shares 16,700 15,500
Capital in excess of par value 41,534,500 34,062,000
Accumulated deficit (40,969,000) (34,581,200)
Total Shareholders' Equity (Deficiency) 582,200 (503,700)
$17,471,300 $8,110,200
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CHROMATICS COLOR SCIENCES INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
REVENUES:
Sales $667,300 $-- $705,900 $--
Other -- 500 100 600
667,300 500 706,000 600
COSTS AND EXPENSES:
Costs of sales 492,600 -- 513,400 --
Sales, marketing and
trade show costs 533,300 660,000 1,170,700 1,201,900
Medical regulatory
expenses 227,200 239,700 423,600 473,300
Research and
development 416,300 261,400 711,000 429,300
Patent application
costs 94,400 5,000 150,500 47,900
Compensation costs
relating to options
granted to consultants
(non cash) 225,000 248,000 465,000 488,000
General and
administrative:
Compensation - Officers
and employees 328,600 210,600 557,000 386,100
Consultants 115,800 72,800 231,800 151,000
Legal fees 250,900 304,200 438,300 552,100
Accounting fees 26,700 24,600 96,600 47,100
Rent and Storage 78,900 74,500 157,000 148,400
Insurance 71,800 64,900 149,500 120,400
Travel and
entertainment 30,200 9,800 47,100 16,500
Repairs and
maintenance 34,800 29,300 82,300 55,700
Depreciation and
amortization 173,000 31,300 344,400 57,900
Payroll taxes 21,900 19,000 42,300 33,000
Stock administrative
fees 24,900 33,400 54,200 43,700
Public relations 52,800 56,400 112,700 101,000
Amortization of
Goodwill 31,000 -- 31,000 --
Other 105,900 87,800 173,200 182,500
3,336,000 2,432,700 5,951,600 4,535,800
OPERATING LOSS (2,668,700) (2,432,200) (5,245,600) (4,535,200)
INTEREST INCOME (EXPENSE):
Interest income 45,000 52,700 89,800 83,700
Interest expense and
non-cash financing
costs (335,400) (1,513,200) (1,232,000) (1,519,800)
(290,400) (1,460,500) (1,142,200) (1,436,100)
NET LOSS $(2,959,100)$(3,892,700) $(6,387,800) $(5,971,300)
NET LOSS TO COMMON
STOCKHOLDERS:
NET LOSS $(2,959,100)$(3,892,700) $(6,387,800) $(5,971,300)
DEEMED DIVIDEND FOR
CLASS B, SERIES
2 AND 3
CONVERTIBLE PREFERRED
STOCK 278,000 1,275,000 981,000 1,275,000
NET LOSS TO COMMON
SHAREHOLDERS $(3,237,100)$(5,167,700) $(7,368,800) $(7,246,300)
WEIGHTED AVERAGE
NUMBER OF COMMON
SHARES OUTSTANDING 16,183,925 15,499,299 15,907,169 15,483,039
BASIC AND DILUTED
LOSS PER SHARE $(0.20) $(0.33) $(0.46) $(0.47)
SOURCE: Chromatics Color Sciences International, Inc.
