Competitive Technologies, Inc.
), a worldwide provider of patent and technology licensing and
commercialization services, recently reported a loss of 6 cents per
share in the second quarter of fiscal 2012, a penny higher than the
Zacks Consensus Estimate of a loss of 5 cents. However, the
quarter's loss was 40% narrower than the year-ago quarter loss of
12 cents per share.
Competitive Technologies earns revenue in two ways: sales of
finished products (product revenues) and retained royalties from
licensing its clients' and own technologies to customer licensees
(other revenues) .
Total revenue declined a massive 62.4% year over year to $123
thousand during the quarter. Other revenue skyrocketed 275% to $60
thousand but a 79.7% drop in product revenues to $63 thousand was a
letdown. The huge decline in the company's product sales was
attributable to lower Calmare pain therapy medical device
The Calmare device, a major source of Competitive Technologies'
revenue, is a solution for chronic pain management. It provides
lasting effects in the treatment of chemotherapy-induced peripheral
neuropathy (CIPN), drug-resistant chronic neuropathic and cancer
pain. In the reported quarter, Competitive Technologies sold and
shipped only one Calmare device compared to 4 units sold in the
second quarter of 2011.
Gross profit from product sale was $17 thousand, significantly
down from $189 thousand in the year-ago quarter. As a result,
product sales gross margin stood at 26.9%, much lower than the
year-ago level of 60.7%.
Net loss remained at $942 thousand compared with a net loss of
$1.33 million in the second quarter of fiscal 2011.
The company exited the second quarter with cash and equivalents
of $20 thousand compared with $28 thousand at the end of fiscal
2011. Year-to-date, net cash used in operating activities was
$458.5 thousand versus $278.7 thousand in the comparable period
On the heels of the huge sales decline, the company is now
focusing on increasing the sales of the Calmare device as well as
Scrambler Therapy technology to treat neuropathic and cancer pain.
Competitive Technologies currently plans to gain private health
insurance reimbursement from a number of private insurers to
satisfy the financial needs of doctors and clinics and obtain a
reasonable reimbursement rate from the Medicare system to provide
income for medical practices and hospitals.
With all the sales effort, the company expects revenues to
increase over the next two fiscal years. Competitive Technologies
is also working on new and existing technologies or products to
diversify the product base. The stock carries a Zacks #3 Rank (Hold
rating in the short term).
(CTTC): ETF Research Reports
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