Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | 5-May-15 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 31-Mar-15 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | NEO | |
Entity Registrant Name | NEOGENOMICS INC | |
Entity Central Index Key | 1077183 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 60,368,672 |
Consolidated_Balance_Sheets_Un
Consolidated Balance Sheets (Unaudited) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
CURRENT ASSETS | ||
Cash and cash equivalents | $31,248 | $33,689 |
Accounts receivable (net of allowance for doubtful accounts of $4,079 and $4,180 respectively) | 21,484 | 20,475 |
Inventories | 2,595 | 2,616 |
Deferred income tax asset, net | 821 | 821 |
Other current assets | 1,183 | 1,141 |
Total current assets | 57,331 | 58,742 |
PROPERTY AND EQUIPMENT (net of accumulated depreciation of $21,406 and $19,822 respectively) | 16,640 | 15,082 |
INTANGIBLE ASSETS, NET | 4,119 | 4,212 |
GOODWILL | 2,929 | 2,929 |
OTHER ASSETS | 139 | 141 |
TOTAL ASSETS | 81,158 | 81,106 |
CURRENT LIABILITIES | ||
Accounts payable | 5,465 | 6,294 |
Accrued compensation | 3,394 | 3,897 |
Accrued expenses and other liabilities | 1,237 | 1,208 |
Short-term portion of equipment capital lease obligations | 3,759 | 3,224 |
Total current liabilities | 13,855 | 14,623 |
LONG-TERM LIABILITIES | ||
Long-term portion of equipment capital lease obligations | 6,327 | 5,257 |
Deferred income tax liability, net | 821 | 821 |
Total long-term liabilities | 7,148 | 6,078 |
TOTAL LIABILITIES | 21,003 | 20,701 |
COMMITMENTS AND CONTINGENCIES (SEE NOTE G) | ||
STOCKHOLDERS' EQUITY | ||
Common stock, $.001 par value, (100,000,000 shares authorized; 60,335,279 and 60,242,818 shares issued and outstanding, respectively) | 60 | 60 |
Additional paid-in capital | 80,262 | 79,751 |
Accumulated deficit | -20,167 | -19,406 |
Total stockholders' equity | 60,155 | 60,405 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $81,158 | $81,106 |
Consolidated_Balance_Sheets_Un1
Consolidated Balance Sheets (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $4,079 | $4,180 |
Property and equipment, accumulated depreciation | $21,406 | $19,822 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 60,335,279 | 60,242,818 |
Common stock, shares outstanding | 60,335,279 | 60,242,818 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Statement [Abstract] | ||
NET REVENUE | $23,026 | $18,182 |
COST OF REVENUE | 13,482 | 9,473 |
GROSS MARGIN | 9,544 | 8,709 |
OPERATING EXPENSES | ||
General and administrative | 6,522 | 5,054 |
Research and development | 669 | 628 |
Sales and marketing | 2,914 | 2,633 |
Total operating expenses | 10,105 | 8,315 |
(LOSS) INCOME FROM OPERATIONS | -561 | 394 |
INTEREST AND OTHER EXPENSE - NET | 195 | 265 |
(LOSS) INCOME BEFORE INCOME TAXES | -756 | 129 |
INCOME TAXES | 5 | 27 |
NET (LOSS) INCOME | ($761) | $102 |
NET (LOSS) INCOME PER SHARE - Basic | ($0.01) | $0 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - Basic | 60,277 | 49,277 |
NET (LOSS) INCOME PER SHARE - Diluted | ($0.01) | $0 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - Diluted | 60,277 | 53,469 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net (loss) income | ($761) | $102 |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ||
Bad debt expense | 602 | 884 |
Amortization of intangibles | 93 | 56 |
Depreciation and amortization of property and equipment | 1,586 | 1,151 |
Amortization of debt issue costs | 12 | |
Stock-based compensation - options and restricted stock | 342 | 89 |
Stock-based compensation - warrants | 59 | -5 |
Changes in assets and liabilities, net: | ||
Accounts receivable, net of write-offs | -1,610 | -1,492 |
Inventories | 21 | 298 |
Other current assets | -42 | 192 |
Other assets | 1 | -25 |
Accounts payable and other liabilities | -1,078 | -237 |
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES | -787 | 1,025 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchases of property and equipment | -842 | -883 |
NET CASH USED IN INVESTING ACTIVITIES | -842 | -883 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Advances from revolving credit facility, net | 583 | |
Repayments of capital lease obligations | -921 | -772 |
Issuance of common stock for the exercise of options, warrants and ESPP shares | 109 | 598 |
NET CASH (USED IN) PROVIDED BY FINANCING ACTIVITIES | -812 | 409 |
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | -2,441 | 551 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 33,689 | 4,834 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 31,248 | 5,385 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | ||
Interest paid | 212 | 254 |
Income taxes paid | 5 | 159 |
NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Equipment leased under capital lease obligations | $2,525 | $1,693 |
Nature_of_Business_and_Basis_o
Nature of Business and Basis of Presentation | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Nature of Business and Basis of Presentation | NOTE A — NATURE OF BUSINESS AND BASIS OF PRESENTATION |
NeoGenomics, Inc., a Nevada corporation (the “Parent” or the “Parent Company”), and its subsidiaries, NeoGenomics Laboratories, Inc., a Florida corporation (“NEO”, “NeoGenomics Laboratories”) and Path Labs LLC., a Delaware Limited Liability Corporation (“Path Logic”) (collectively referred to as “we”, “us”, “our”, “NeoGenomics”, or the “Company”), operates as a certified “high complexity” clinical laboratory in accordance with the federal government’s Clinical Laboratory Improvement Act, as amended (“CLIA”), and is dedicated to the delivery of clinical diagnostic services to pathologists, oncologists, urologists, hospitals, and other laboratories throughout the United States. | |
The accompanying interim consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. These accompanying interim consolidated financial statements include the accounts of the Parent and its subsidiaries. All intercompany transactions and balances have been eliminated in the accompanying interim consolidated financial statements. | |
Certain information and footnote disclosures normally included in the Company’s annual audited consolidated financial statements and accompanying notes have been condensed or omitted in these accompanying interim consolidated financial statements. Accordingly, the accompanying interim consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and accompanying notes included in the Company’s annual report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission on March 3, 2015. | |
The results of operations presented in this quarterly report on Form 10-Q are not necessarily indicative of the results of operations that may be expected for any future periods. In the opinion of management, these unaudited consolidated financial statements include all adjustments and accruals, consisting only of normal recurring adjustments that are necessary for a fair statement of the results of all interim periods reported herein. |
Recently_Adopted_and_Recently_
Recently Adopted and Recently Issued Accounting Guidance | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Recently Adopted and Recently Issued Accounting Guidance | NOTE B — RECENTLY ADOPTED AND RECENTLY ISSED ACCOUNTING GUIDANCE |
Adopted | |
On January 1, 2015, the Company adopted changes issued by the Financial Accounting Standards Board (“FASB”) in Accounting Standards Update (“ASU”) 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. These changes require a disposal of a component to meet a higher threshold in order to be reported as a discontinued operation in an entity’s financial statements. The adoption of these changes had no impact on the accompanying interim consolidated financial statements. This guidance will need to be considered in the event the Company initiates a disposal transaction. | |
Issued | |
In January 2015, the FASB issued ASU 2015-01, Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. The changes eliminate the concept of an extraordinary item and, therefore, the presentation of such items will no longer be required. These changes become effective for the Company on January 1, 2016. Management has determined that the adoption of these changes will not have an impact on the consolidated financial statements. | |
In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issue Costs. The changes require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. These changes become effective for the Company on January 1, 2016. Management has determined that the adoption of these changes will not have a material impact on the consolidated financial statements. |
Acquisitions
Acquisitions | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Business Combinations [Abstract] | |||||
Acquisitions | NOTE C — ACQUISITIONS | ||||
On July 8, 2014, the Company entered into a membership interest purchase agreement with Path Labs, LLC d/b/a Path Logic, a Delaware limited liability company (“Path Logic”), and Path Labs Holdings, LLC, a Delaware limited liability company (“PL Holdings”), whereby the Company acquired all of the outstanding equity ownership interests in Path Logic from PL Holdings for a purchase price (in thousands) of $5,908. NeoGenomics Laboratories paid the purchase price using cash on hand and borrowings on its revolving credit facility. | |||||
The following table summarizes the final amounts for the fair values of the assets acquired and liabilities assumed at the acquisition date of July 8, 2014 (in thousands): | |||||
July 8, 2014 | |||||
Current assets, including cash and cash equivalents | $ | 1,722 | |||
Property, plant and equipment | 577 | ||||
Identifiable intangible assets – customer relationships | 1,930 | ||||
Long term deposits | 28 | ||||
Goodwill | 2,929 | ||||
Total assets acquired | 7,186 | ||||
Current liabilities | (1,180 | ) | |||
Long-term liabilities | (98 | ) | |||
Net assets acquired | $ | 5,908 | |||
The above estimated fair values of assets acquired and liabilities assumed are based on the information that was available as of the acquisition date to estimate the fair value of assets acquired and liabilities assumed. The measurement period adjustments were complete as of December 31, 2014. | |||||
Acquired intangible assets of $1.93 million consist of customer relationships which are being amortized over thirteen years. We recorded approximately $37,000 of amortization expense for the three months ended March 31, 2015. | |||||
The estimated amortization expense related to the acquired intangible assets for each of the five succeeding fiscal years and thereafter as of March 31, 2015 is as follows (in thousands): | |||||
Year Ending December 31, | |||||
Remainder of 2015 | $ | 111 | |||
2016 | 148 | ||||
2017 | 148 | ||||
2018 | 148 | ||||
2019 | 148 | ||||
2020 | 148 | ||||
Thereafter | 971 | ||||
Total | $ | 1,822 | |||
The goodwill arising from the acquisition of Path Logic includes revenue synergies as a result of our existing customers and Path Logic’s customers having access to each other’s testing menus and capabilities. It also arises from the new product lines which Path Logic adds to the Company’s product portfolio. The total amount of goodwill which is expected to be deductible for tax purposes is approximately $3.7 million, which will be amortized on our tax returns over 15 years. | |||||
The following unaudited pro forma information (in thousands) have been provided for illustrative purposes only and are not necessarily indicative of results that would have occurred had the Acquisition been in effect since January 1, 2013, nor are they necessarily indicative of future results. | |||||
Three Months Ended | |||||
March 31, 2014 | |||||
Revenue | $ | 20,529 | |||
Net (loss) | (566 | ) | |||
(Loss) per share | |||||
Basic | $ | (0.01 | ) | ||
Diluted | $ | (0.01 | ) | ||
The unaudited pro forma consolidated results have been prepared by adjusting our historical results to include the Acquisition as if it occurred on January 1, 2013. These unaudited pro forma consolidated historical results were then adjusted for the following: | |||||
• | a net reduction in amortization expense during the three months ended March 31, 2014 due to decreased intangible assets recorded related to the acquisition, | ||||
• | a net reduction in interest expense during the three months ended March 31, 2014 as we did not acquire the existing debt from the acquisition offset by our interest expense on net borrowings under capital leases and notes payable, | ||||
• | a net reduction in depreciation expense during the three months ended March 31, 2014 due to decreased fixed asset values recorded related to the acquisition, | ||||
• | a net reduction in general and administrative expenses for the three months ended March 31, 2014 to remove the management fees from the private equity company and the Chief Executive Officer’s salary from the results, | ||||
• | a net reduction to adjust for the tax effect of the losses that were acquired which is based on an estimate of the state income taxes and federal alternate minimum tax which would not be required based on the losses for all periods. | ||||
As noted above, the unaudited pro forma results of operations do not purport to be indicative of the actual results that would have been achieved by the combined company for the periods presented or that may be achieved by the combined company in the future. |
Intangible_Assets
Intangible Assets | 3 Months Ended | ||||||||||||||
Mar. 31, 2015 | |||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||
Intangible Assets | NOTE D — INTANGIBLE ASSETS | ||||||||||||||
Intangible assets as of March 31, 2015 and December 31, 2014 consisted of the following (in thousands): | |||||||||||||||
Amortization | March 31, 2015 | ||||||||||||||
Period | |||||||||||||||
COST | Accumulated | Net | |||||||||||||
Amortization | |||||||||||||||
Customer Relationships | 156 months | $ | 1,930 | $ | 108 | $ | 1,822 | ||||||||
Support Vector Machine (SVM) technology | 108 months | 500 | 181 | 319 | |||||||||||
Laboratory developed test (LDT) technology | 164 months | 1,482 | 324 | 1,158 | |||||||||||
Flow Cytometry and Cytogenetics technology | 202 months | 1,000 | 180 | 820 | |||||||||||
Total | $ | 4,912 | $ | 793 | $ | 4,119 | |||||||||
Amortization | December 31, 2014 | ||||||||||||||
Period | |||||||||||||||
COST | Accumulated | Net | |||||||||||||
Amortization | |||||||||||||||
Customer Relationships | 156 months | $ | 1,930 | $ | 71 | $ | 1,859 | ||||||||
Support Vector Machine (SVM) technology | 108 months | 500 | 167 | 333 | |||||||||||
Laboratory developed test (LDT) technology | 164 months | 1,482 | 297 | 1,185 | |||||||||||
Flow Cytometry and Cytogenetics technology | 202 months | 1,000 | 165 | 835 | |||||||||||
Total | $ | 4,912 | $ | 700 | $ | 4,212 | |||||||||
We recorded approximately $93,000 and $56,000 in straight-line amortization expense of intangibles in the three months ended March 31, 2015 and 2014, respectively. The Company recorded amortization expense from customer relationships as a general and administrative expense. We will continue to record the amortization of the Support Vector Machine (SVM) technology, the Laboratory developed tests (LDT) technology and the Flow Cytometry and Cytogenetics technology intangibles as a research and development expense until the time that we have products, services or cost savings directly attributable to these intangible assets that would require that it be recorded in cost of goods sold. | |||||||||||||||
The estimated amortization expense related to amortizable intangible assets for each of the five succeeding fiscal years and thereafter as of March 31, 2015 is as follows (in thousands): | |||||||||||||||
Year Ending December 31, | |||||||||||||||
Remainder of 2015 | $ | 278 | |||||||||||||
2016 | 371 | ||||||||||||||
2017 | 371 | ||||||||||||||
2018 | 371 | ||||||||||||||
2019 | 371 | ||||||||||||||
2020 | 371 | ||||||||||||||
Thereafter | 1,986 | ||||||||||||||
Total | $ | 4,119 | |||||||||||||
Revenue_Recognition_and_Contra
Revenue Recognition and Contractual Adjustments | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Accounting Policies [Abstract] | |||||||||
Revenue Recognition and Contractual Adjustments | NOTE E — REVENUE RECOGNITION AND CONTRACTUAL ADJUSTMENTS | ||||||||
The Company recognizes revenues when (a) the price is fixed or determinable, (b) persuasive evidence of an arrangement exists, (c) the service is performed and (d) collectability of the resulting receivable is reasonably assured. | |||||||||
The Company’s specialized diagnostic services are performed based on a written test requisition form or electronic equivalent and revenues are recognized once the diagnostic services have been performed, and the results have been delivered to the ordering physician. These diagnostic services are billed to various payers, including Medicare, commercial insurance companies, other directly billed healthcare institutions such as hospitals and clinics, and individuals. The Company reports revenues from contracted payers, including Medicare, certain insurance companies and certain healthcare institutions, based on the contractual rate, or in the case of Medicare, published fee schedules. The Company reports revenues from non-contracted payers, including certain insurance companies and individuals, based on the amount expected to be collected. The difference between the amount billed and the amount estimated to be collected from non-contracted payers is recorded as an allowance to arrive at the reported net revenues. The expected revenues from non-contracted payers are based on the historical collection experience of each payer or payer group, as appropriate. The Company records revenues from patient pay tests net of a large discount and as a result recognizes minimal revenue on those tests. The Company regularly reviews its historical collection experience for non-contracted payers and adjusts its expected revenues for current and subsequent periods accordingly. | |||||||||
The table below shows the adjustments made to gross service revenue to arrive at net revenues (in thousands), the amount reported on our statement of operations. | |||||||||
Three Months Ended March 31, | |||||||||
2015 | 2014 | ||||||||
Gross Service Revenues | $ | 53,631 | $ | 41,200 | |||||
Total Contractual Adjustments and Discounts | (30,605 | ) | (23,018 | ) | |||||
Net Revenues | $ | 23,026 | $ | 18,182 |
Equity
Equity | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Equity [Abstract] | |||||||||
Equity | NOTE F — EQUITY | ||||||||
Stock Options | |||||||||
A summary of the stock option activity under the Company’s plans for the three months ended March 31, 2015 is as follows: | |||||||||
Weighted | |||||||||
Number | average | ||||||||
of | exercise | ||||||||
shares | price | ||||||||
Options outstanding at December 31, 2014 | 4,012,096 | $ | 2.04 | ||||||
Options granted | 51,000 | 4.1 | |||||||
Less: | |||||||||
Options exercised | 67,875 | 1.48 | |||||||
Options canceled or expired | — | — | |||||||
Options outstanding at March 31, 2015 | 3,995,221 | $ | 2.08 | ||||||
As of March 31, 2015, options to purchase 2,742,996 shares were vested and exercisable at a weighted average price of $1.44. | |||||||||
As of March 31, 2015, there was approximately $0.9 million of total unrecognized share-based compensation expense related to stock options that will be recognized over a weighted-average period of 1.6 years. | |||||||||
Share-based compensation expense recognized for stock options and restricted stock and included in the condensed consolidated statements of income was allocated as follows: | |||||||||
Three months | |||||||||
ended | |||||||||
March 31, | |||||||||
(In thousands) | 2015 | 2014 | |||||||
Research and development expense | $ | 55 | $ | 42 | |||||
General, and administrative expense | 287 | 47 | |||||||
Total share-based compensation expense | $ | 342 | $ | 89 | |||||
Common Stock Warrants | |||||||||
There has been no activity during the three months ended March 31, 2015 for warrants and as of March 31, 2015, warrants to purchase 650,000 shares of our common stock were outstanding with a weighted average exercise price of $1.48 per share. As of March 31, 2015 there are 530,000 warrants exercisable with a weighted average exercise price of $1.49. During the three months ended March 31, 2015 and 2014, we recorded $59,000 and $(5,000) of warrant compensation expense. |
Commitments
Commitments | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | NOTE G — COMMITMENTS |
During the three months ended March 31, 2015, we entered into a lease agreement with Wells Fargo Equipment Finance for approximately $1.4 million for the purchase of laboratory and computer equipment. The lease has a 60 month term with $1 buyout option at the end of the term and an interest rate of 4.08%. | |
During the three months ended March 31, 2015, we entered into lease agreements with several vendors for approximately $1.1 million for the purchase of computer equipment and computer software. The leases have 36 month terms with $1 buyout options at the end of the terms and interest rates in the range between 4.25% and 13.5%. |
Other_Related_Party_Transactio
Other Related Party Transactions | 3 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
Other Related Party Transactions | NOTE H — OTHER RELATED PARTY TRANSACTIONS |
During the three month periods ended March 31, 2015 and 2014, Steven C. Jones, a director of the Company, earned approximately $65,000 and $62,500 for various consulting work performed in connection with his duties as Executive Vice President of Finance. Mr. Jones also received $77,500 and $47,500 during the three months ended March 31, 2015 and 2014, respectively as payment of his annual bonus compensation for the previous fiscal years. |
Subsequent_Event
Subsequent Event | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Event | NOTE I — SUBSEQUENT EVENT |
On May 4, 2015 the Board of Directors amended the Amended and Restated Equity Incentive Plan (Amended and Restated Effective as of April 16, 2013) (the “Plan”) to add an additional 2,500,000 shares to the maximum aggregate number of shares of Common Stock reserved and available for issuance under the Plan, bringing the total available from the Plan to 9,500,000 shares. | |
On May 4, 2015 the Compensation Committee of the Board of Directors granted 1,645,000 options to certain Executives and key employees of the Company. The options were granted at a price of $4.78 per share and had a weighted average fair market value of $1.80 per option for a total fair market value of $2,961,000. We expect our stock option compensation expense to increase by approximately $1.2 million, $1.2 million, $500,000, and $100,000 in the years ended December 31, 2015, 2016, 2017 and 2018, respectively. |
Recently_Adopted_and_Recently_1
Recently Adopted and Recently Issued Accounting Guidance (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Changes and Error Corrections [Abstract] | |
Adopted and Issued Accounting Policies | Adopted |
On January 1, 2015, the Company adopted changes issued by the Financial Accounting Standards Board (“FASB”) in Accounting Standards Update (“ASU”) 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. These changes require a disposal of a component to meet a higher threshold in order to be reported as a discontinued operation in an entity’s financial statements. The adoption of these changes had no impact on the accompanying interim consolidated financial statements. This guidance will need to be considered in the event the Company initiates a disposal transaction. | |
Issued | |
In January 2015, the FASB issued ASU 2015-01, Simplifying Income Statement Presentation by Eliminating the Concept of Extraordinary Items. The changes eliminate the concept of an extraordinary item and, therefore, the presentation of such items will no longer be required. These changes become effective for the Company on January 1, 2016. Management has determined that the adoption of these changes will not have an impact on the consolidated financial statements. | |
In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issue Costs. The changes require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. These changes become effective for the Company on January 1, 2016. Management has determined that the adoption of these changes will not have a material impact on the consolidated financial statements. |
Acquisitions_Tables
Acquisitions (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Summary of Final Amounts for Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the final amounts for the fair values of the assets acquired and liabilities assumed at the acquisition date of July 8, 2014 (in thousands): | ||||
July 8, 2014 | |||||
Current assets, including cash and cash equivalents | $ | 1,722 | |||
Property, plant and equipment | 577 | ||||
Identifiable intangible assets – customer relationships | 1,930 | ||||
Long term deposits | 28 | ||||
Goodwill | 2,929 | ||||
Total assets acquired | 7,186 | ||||
Current liabilities | (1,180 | ) | |||
Long-term liabilities | (98 | ) | |||
Net assets acquired | $ | 5,908 | |||
Estimated Amortization Expense | The estimated amortization expense related to amortizable intangible assets for each of the five succeeding fiscal years and thereafter as of March 31, 2015 is as follows (in thousands): | ||||
Year Ending December 31, | |||||
Remainder of 2015 | $ | 278 | |||
2016 | 371 | ||||
2017 | 371 | ||||
2018 | 371 | ||||
2019 | 371 | ||||
2020 | 371 | ||||
Thereafter | 1,986 | ||||
Total | $ | 4,119 | |||
Summary of Unaudited Pro-forma Information | The following unaudited pro forma information (in thousands) have been provided for illustrative purposes only and are not necessarily indicative of results that would have occurred had the Acquisition been in effect since January 1, 2013, nor are they necessarily indicative of future results. | ||||
Three Months Ended | |||||
March 31, 2014 | |||||
Revenue | $ | 20,529 | |||
Net (loss) | (566 | ) | |||
(Loss) per share | |||||
Basic | $ | (0.01 | ) | ||
Diluted | $ | (0.01 | ) | ||
Path Logic [Member] | |||||
Estimated Amortization Expense | The estimated amortization expense related to the acquired intangible assets for each of the five succeeding fiscal years and thereafter as of March 31, 2015 is as follows (in thousands): | ||||
Year Ending December 31, | |||||
Remainder of 2015 | $ | 111 | |||
2016 | 148 | ||||
2017 | 148 | ||||
2018 | 148 | ||||
2019 | 148 | ||||
2020 | 148 | ||||
Thereafter | 971 | ||||
Total | $ | 1,822 | |||
Intangible_Assets_Tables
Intangible Assets (Tables) | 3 Months Ended | ||||||||||||||
Mar. 31, 2015 | |||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||
Classes of Intangible Assets | Intangible assets as of March 31, 2015 and December 31, 2014 consisted of the following (in thousands): | ||||||||||||||
Amortization | March 31, 2015 | ||||||||||||||
Period | |||||||||||||||
COST | Accumulated | Net | |||||||||||||
Amortization | |||||||||||||||
Customer Relationships | 156 months | $ | 1,930 | $ | 108 | $ | 1,822 | ||||||||
Support Vector Machine (SVM) technology | 108 months | 500 | 181 | 319 | |||||||||||
Laboratory developed test (LDT) technology | 164 months | 1,482 | 324 | 1,158 | |||||||||||
Flow Cytometry and Cytogenetics technology | 202 months | 1,000 | 180 | 820 | |||||||||||
Total | $ | 4,912 | $ | 793 | $ | 4,119 | |||||||||
Amortization | December 31, 2014 | ||||||||||||||
Period | |||||||||||||||
COST | Accumulated | Net | |||||||||||||
Amortization | |||||||||||||||
Customer Relationships | 156 months | $ | 1,930 | $ | 71 | $ | 1,859 | ||||||||
Support Vector Machine (SVM) technology | 108 months | 500 | 167 | 333 | |||||||||||
Laboratory developed test (LDT) technology | 164 months | 1,482 | 297 | 1,185 | |||||||||||
Flow Cytometry and Cytogenetics technology | 202 months | 1,000 | 165 | 835 | |||||||||||
Total | $ | 4,912 | $ | 700 | $ | 4,212 | |||||||||
Revenue_Recognition_and_Contra1
Revenue Recognition and Contractual Adjustments (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Accounting Policies [Abstract] | |||||||||
Adjustment of Transactions Revenue | The table below shows the adjustments made to gross service revenue to arrive at net revenues (in thousands), the amount reported on our statement of operations. | ||||||||
Three Months Ended March 31, | |||||||||
2015 | 2014 | ||||||||
Gross Service Revenues | $ | 53,631 | $ | 41,200 | |||||
Total Contractual Adjustments and Discounts | (30,605 | ) | (23,018 | ) | |||||
Net Revenues | $ | 23,026 | $ | 18,182 |
Equity_Tables
Equity (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Equity [Abstract] | |||||||||
Summary of Stock Option Activity | A summary of the stock option activity under the Company’s plans for the three months ended March 31, 2015 is as follows: | ||||||||
Weighted | |||||||||
Number | average | ||||||||
of | exercise | ||||||||
shares | price | ||||||||
Options outstanding at December 31, 2014 | 4,012,096 | $ | 2.04 | ||||||
Options granted | 51,000 | 4.1 | |||||||
Less: | |||||||||
Options exercised | 67,875 | 1.48 | |||||||
Options canceled or expired | — | — | |||||||
Options outstanding at March 31, 2015 | 3,995,221 | $ | 2.08 | ||||||
Summary of Share-Based Compensation Expense Recognized for Stock Options and Restricted Stock Included in Condensed Consolidated Statements of Income | Share-based compensation expense recognized for stock options and restricted stock and included in the condensed consolidated statements of income was allocated as follows: | ||||||||
Three months | |||||||||
ended | |||||||||
March 31, | |||||||||
(In thousands) | 2015 | 2014 | |||||||
Research and development expense | $ | 55 | $ | 42 | |||||
General, and administrative expense | 287 | 47 | |||||||
Total share-based compensation expense | $ | 342 | $ | 89 |
Acquisitions_Additional_Inform
Acquisitions - Additional Information (Detail) (USD $) | 3 Months Ended | 0 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | Jul. 08, 2014 | |
Business Acquisition [Line Items] | |||
Amortization expense of intangibles | $93,000 | $56,000 | |
Path Logic [Member] | |||
Business Acquisition [Line Items] | |||
Business acquisition purchase price | 5,908,000 | ||
Amortization expense of intangibles | 37,000 | ||
Acquired intangible assets | 1,930,000 | ||
Intangible asset amortization period | 13 years | ||
Goodwill expected tax deductible amount | $3,700,000 | ||
Amortization Period | 15 years |
Acquisitions_Summary_of_Estima
Acquisitions - Summary of Estimated Fair Values of Assets Acquired and Liabilities Assumed (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 | Jul. 08, 2014 |
Business Acquisition [Line Items] | |||
GOODWILL | $2,929,000 | $2,929,000 | |
Path Logic [Member] | |||
Business Acquisition [Line Items] | |||
Current assets, including cash and cash equivalents | 1,722,000 | ||
Property, plant and equipment | 577,000 | ||
Identifiable intangible assets - customer relationships | 1,930,000 | ||
Long term deposits | 28,000 | ||
GOODWILL | 2,929,000 | ||
Total assets acquired | 7,186,000 | ||
Current liabilities | -1,180,000 | ||
Long-term liabilities | -98,000 | ||
Net assets acquired | $5,908,000 |
Acquisitions_Estimated_Amortiz
Acquisitions - Estimated Amortization Expense (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remainder of 2015 | $278 | |
2016 | 371 | |
2017 | 371 | |
2018 | 371 | |
2019 | 371 | |
2020 | 371 | |
Thereafter | 1,986 | |
Total | 4,119 | 4,212 |
Path Logic [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remainder of 2015 | 111 | |
2016 | 148 | |
2017 | 148 | |
2018 | 148 | |
2019 | 148 | |
2020 | 148 | |
Thereafter | 971 | |
Total | $1,822 |
Acquisitions_Summary_of_Unaudi
Acquisitions - Summary of Unaudited Pro-forma Information (Detail) (Path Logic [Member], USD $) | 3 Months Ended |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 |
Path Logic [Member] | |
Business Acquisition [Line Items] | |
Revenue | $20,529 |
Net (loss) | ($566) |
(Loss) per share | |
Basic | ($0.01) |
Diluted | ($0.01) |
Intangible_Assets_Classes_of_I
Intangible Assets - Classes of Intangible Assets (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Dec. 31, 2014 |
Finite-Lived Intangible Assets [Line Items] | ||
COST | $4,912 | $4,912 |
Accumulated Amortization | 793 | 700 |
Total | 4,119 | 4,212 |
Customer Relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 156 months | 156 months |
COST | 1,930 | 1,930 |
Accumulated Amortization | 108 | 71 |
Total | 1,822 | 1,859 |
Support Vector Machine (SVM) Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 108 months | 108 months |
COST | 500 | 500 |
Accumulated Amortization | 181 | 167 |
Total | 319 | 333 |
Laboratory Developed Test (LDT) Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 164 months | 164 months |
COST | 1,482 | 1,482 |
Accumulated Amortization | 324 | 297 |
Total | 1,158 | 1,185 |
Flow Cytometry and Cytogenetics Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization Period | 202 months | 202 months |
COST | 1,000 | 1,000 |
Accumulated Amortization | 180 | 165 |
Total | $820 | $835 |
Intangible_Assets_Additional_I
Intangible Assets - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangibles | $93 | $56 |
Intangible_Assets_Estimated_Am
Intangible Assets - Estimated Amortization Expense (Detail) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of 2015 | $278 | |
2016 | 371 | |
2017 | 371 | |
2018 | 371 | |
2019 | 371 | |
2020 | 371 | |
Thereafter | 1,986 | |
Total | $4,119 | $4,212 |
Revenue_Recognition_and_Contra2
Revenue Recognition and Contractual Adjustments - Adjustment of Transactions Revenue (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Revenue Recognition [Abstract] | ||
Gross Service Revenues | $53,631 | $41,200 |
Total Contractual Adjustments and Discounts | -30,605 | -23,018 |
Net Revenues | $23,026 | $18,182 |
Equity_Summary_of_Stock_Option
Equity - Summary of Stock Option Activity (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Equity [Abstract] | |
Stock options, beginning balance | 4,012,096 |
Stock options, granted | 51,000 |
Stock options, exercised | 67,875 |
Stock options, canceled or expired | 0 |
Stock options, ending balance | 3,995,221 |
Weighted average exercise price, beginning balance | $2.04 |
Weighted average exercise price, granted | $4.10 |
Weighted average exercise price, exercised | $1.48 |
Weighted average exercise price, canceled or expired | $0 |
Weighted average exercise price, ending balance | $2.08 |
Equity_Additional_Information_
Equity - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares vested and exercisable | 2,742,996 | |
Weighted average exercise price of shares vested and exercisable | $1.44 | |
Unrecognized stock-based compensation cost | $900,000 | |
Unrecognized share-based compensation expense, weighted-average recognition period | 1 year 7 months 6 days | |
Warrants to purchase common stock, shares | 650,000 | |
Warrants, weighted average exercise price | $1.48 | |
Stock compensation expense | 342,000 | 89,000 |
Warrant [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock compensation expense | $59,000 | ($5,000) |
Warrants exercisable, weighted average exercised price | $1.49 | |
Warrants exercisable | 530,000 |
Equity_Summary_of_ShareBased_C
Equity - Summary of Share-Based Compensation Expense Recognized for Stock Options and Restricted Stock Included in Condensed Consolidated Statements of Income (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $342 | $89 |
Research and Development Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 55 | 42 |
General and Administrative Expense [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $287 | $47 |
Commitments_Additional_Informa
Commitments - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Contractual Obligation [Line Items] | ||
Agreement for purchase of equipment | $2,525,000 | $1,693,000 |
Laboratory And Computer Equipment [Member] | Wells Fargo Equipment Finance [Member] | ||
Contractual Obligation [Line Items] | ||
Agreement for purchase of equipment | 1,400,000 | |
Lease term period | 60 months | |
Buyout option | 1 | |
Interest rate | 4.08% | |
Other Lease Agreement [Member] | Computer Equipment and Computer Software [Member] | ||
Contractual Obligation [Line Items] | ||
Agreement for purchase of equipment | 1,100,000 | |
Buyout option | $1 | |
Minimum [Member] | Other Lease Agreement [Member] | Computer Equipment and Computer Software [Member] | ||
Contractual Obligation [Line Items] | ||
Lease term period | 36 months | |
Interest rate | 4.25% | |
Maximum [Member] | Other Lease Agreement [Member] | Computer Equipment and Computer Software [Member] | ||
Contractual Obligation [Line Items] | ||
Interest rate | 13.50% |
Other_Related_Party_Transactio1
Other Related Party Transactions - Additional Information (Detail) (Executive Vice President [Member], USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Executive Vice President [Member] | ||
Related Party Transaction [Line Items] | ||
Fees for consulting work performed | $65,000 | $62,500 |
Payment of annual bonus compensation | $77,500 | $47,500 |
Subsequent_Event_Additional_In
Subsequent Event - Additional Information (Detail) (USD $) | 3 Months Ended | 0 Months Ended |
Mar. 31, 2015 | 4-May-15 | |
Subsequent Event [Line Items] | ||
Options, grant date price | $4.10 | |
Subsequent Event [Member] | Amended And Restated Equity Incentive Plan [Member] | ||
Subsequent Event [Line Items] | ||
Number of additional shares authorized for issuance | 2,500,000 | |
Aggregate number of shares available for issuance | 9,500,000 | |
Subsequent Event [Member] | Amended And Restated Equity Incentive Plan [Member] | 2015 [Member] | ||
Subsequent Event [Line Items] | ||
stock option compensation expense | 1,200,000 | |
Subsequent Event [Member] | Amended And Restated Equity Incentive Plan [Member] | 2016 [Member] | ||
Subsequent Event [Line Items] | ||
stock option compensation expense | 1,200,000 | |
Subsequent Event [Member] | Amended And Restated Equity Incentive Plan [Member] | 2017 [Member] | ||
Subsequent Event [Line Items] | ||
stock option compensation expense | 500,000 | |
Subsequent Event [Member] | Amended And Restated Equity Incentive Plan [Member] | 2018 [Member] | ||
Subsequent Event [Line Items] | ||
stock option compensation expense | 100,000 | |
Subsequent Event [Member] | Amended And Restated Equity Incentive Plan [Member] | Certain Executives And Key Employees [Member] | ||
Subsequent Event [Line Items] | ||
Options, grant date price | 4.78 | |
Options, weighted average fair market value | 1.8 | |
Options, number granted | 1,645,000 | |
Options granted, fair market value | 2,961,000 |