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TOPIC: Q1 2014 analyst estimates

Q1 2014 analyst estimates 17 Apr 2014 14:43 #1562

  • myownhedgefund
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Average is for 2.87 million in revenues despite the large "deffered" earnings from Q4 2013

Q2 estimate is even lower.

With the call a few short weeks away should be interesting from a accounting point of view with slight of hand distracting to BARDA and ATHENA. I wonder what Saad will offer as in the last call he really didnt say much with his explainations imho.

Maybe I can get Belgiumineurope to chime in since when I brought up the Q4 lowering of estimates before the call he was quite upset...LOL !

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Q1 2014 analyst estimates 18 Apr 2014 09:22 #1564

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I wonder what Saad will offer as in the last call he really didnt say much with his explanations imho.


I guess that is the correct assessment- he did say I helluvalot but in the end he didnt say anything at all, except for maybe an additional 180-360 additional days before recognizing a shipment to Japan as revenue i.e. a receivable.
Given that the investor could read a few days later that the KPMG opinion was qualified and 1,5 Mio$ of bad debt was reserved for, this is the poorest showing that any financial person can have.

This is "the lecture" from the CC: -if you grasp that- congrats- I guess it means, he is clueless at present, so we should not expect anything much.

Kolbert: Hi, guys. So I want to talk just a little bit about what happened in the fourth quarter because you had been guiding us to $7 million and I understand that product revenue, well, it fell and $3.6 million will probably be recognized in the first quarter. What was that shortfall and how was performance in Japan?

Hey, Jason, it's Mark Saad. I will address the revenue and shipment number and like you said, we were guiding towards sales to be higher and would have seen that happen if we had not made a change subsequent to our last call regarding the way in which we will book revenue and that's based on observation of a number of cases that we've been tracking where particularly when you are international just to give a quick perspective, I think we are in a pretty unique situation as a U.S. medical company where in many course the vast majority of our sales come from Japan. And so that's a fairly unique situation. So what we've done and have sought to do is to maximally align our sales contracts, et cetera, with traditional U.S. GAAP and that's how we've embarked upon it and have managed the sales process and the accounting revenue recognition side of the equation.
Knowing that Japan is a very different marketplace in terms of culture, everything and knowing that what we see today on a small scale may well only expand over time. I mean we think there is a lot of near-term growth that's going to come from Japan particularly with these new regen med laws and we are in a unique position with a dedicated team there to capitalize on that. It was really important for us to get this right and to make sure we're being maximally minimizing future risks in terms of where a customer could implicitly look at a contract different than the way the explicit language of a contract exists.
And so in looking at a number of cases where that could be the case, we took the step following review of the quarter to really put all new customers into a – effectively a holding pattern from a recognition point of view basically even if they met clean U.S. GAAP contract terms, we would still put an additional filter of, okay, let's still defer to other things particularly collections but there is a number of things that we want to make sure are really final and not take revenue risk. And that was something that took place in the fourth quarter review based on, I would say, a number of individual cases which really made it hard to know prospectively in a given situation even if the contracts were clean would it be not better to take a more conservative approach overall. And so given our growth needs and growth objectives particularly in Japan, we felt in combination of talking with our auditors and committees that that was the right way to go. So we're putting in place a number of changes like that.
And so the outcome there, Jason, was that we had a fairly large number of sales predominantly from Japan as identified in that number that we did not take as revenue in 2013, but they were successfully shipped, received and we would anticipate them being picked up this year. So while that certainly is consistent with what you said in terms of not to be in the fourth quarter, we do think that the inherent demand for the product is there and now we just want to make sure that we've aligned recognition practices in a way that best protect us going forward.

Kolbert: Mark, I totally understand, but does that mean that we should be adjusting our guidance for 2014, or should we make any change to that number? In other words, or is this just a mouse going down a snake and we'll just push everything out a quarter?

Saad: That's a good question, Jason. I think, in general, as we look at what our 2014 results will be, we recognize that you have this existing business and, yes, to the extent that you've got this existing business that's predominantly to researchers, you're going to have that extra mouse, as you call it, of revenues that's in there that will obviously enhance what we accomplish in 2014.
We'll also have based on this policy, I think, a scenario where until we see individual customer experiences particularly in Japan cleanly go the route of where the customers are really following the U.S. contracts the way we would need them to per U.S. GAAP. Then I think you could safely say, well, we'll probably embed a one to two quarter delay on when a shipment is made particularly in Japan and when we'll see the revenues. So I think it's partially true, Jason, at the same time, I think we can also infer inherent lag of shipments and booking particularly in Japan for those customers. So that's one fact I would point out.
The other fact is that while the existing research business has been the nature of link, particularly given the – whether it's the reimbursement environment or the fact that the market exit points really get to a consumable business have not yet been fully put together such that it's really been the capital equipment sale phase that we are seeking to then graduate from to the consumable phase to predict exactly how the year will shake out, given the, I'd say, the large funnel of opportunity but the inherent variability quarter-to-quarter and the fact that we've got now this Lorem Vascular transaction with the China approval that could have any magnitude on the revenues as an example.
The Japan regulations which could have a big impact, the implementation of that act is the part that we are really trying to make sure we understand before we go out and say, well, this is how fast the revenues are going to grow now because of these potentially sea-changing events. Instead of doing of that, what we are saying is we are going to keep growing demand for the product, we expect you'll see modest growth on the baseline consistent with that research business, however, we do have identified inflexion points, pivot points based on defined events such as the Lorem contract, such as the Japan regen med laws and all we are saying is we want to evaluate those, really make sure we are seeing them implement and then come back to you with, okay, this is what now how we think that's going to impact based on experience rather than getting too far in front of those and how fast it's going to cause our revenues to grow. So that's how I look at 2014. We should grow but we know that quarters can be variable and we're going to come back to you with as we see Japan and China and anything else that really moves the needle in that way come back to you as we see those play out.

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Q1 2014 analyst estimates 18 Apr 2014 10:14 #1565

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Let's face it. We can't believe a thing we hear out of CYTX mangement. This team has absolutely zero credibility ,on the street and this is refelected in the pps. In 4 years I can't recall a single instance of accurate guidance. It's foolish to believe that all will come true but when absolutely nothing happens then you (I) have to believe we are out right being lied to. There are many large holders like DOV that communicate with CC, SAAD, Hendricks et el on a regular basis and after 4 year of misinformation IMHO they have been used as pawns to keep the investors that they have brought into this calm. It's not there fault,they have been Calhouned as well. The retirement of CC still bugs me and although he has been completely ineffective as a CEO there is more to this story then we are being told. Shortly after I was first introduced to Cytori the stock traded up to $8.50 based on today's pps it has lost appx 72% of it's value and if you take dillution into consideration even more. Is anyone who read this MB not in the red.
Buyout today at 100% premium yields $4.80. Unless you are buying now for the first time this investment can't be anything but a disater. I keep hearing about potential but the company lacks funds to realize the potential. If BARDA is a bust would someone please explain how this company survives ? I have to be missing something or am I. Just had to vent it's healthy.

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Q1 2014 analyst estimates 18 Apr 2014 12:04 #1569

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Yeah...the accounting has to have played a role in the large short increase.....but with so many repeated failures the have lots of reasons to pressure the stock.

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