Exhibit 99.1
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Press Release | Source: Stellar Pharmaceuticals Inc. |
Stellar Pharmaceuticals’ Q3-2009 Financial Results Marked by Strong Growth and Continued Profitability
LONDON, Ontario – November 10, 2009 –Stellar Pharmaceuticals Inc. ("Stellar" or "the Company") (OTCBB:SLXCF),a Canadian pharmaceutical developer and marketer of high quality, cost-effective products for select health care markets, today announced its financial results for the third quarter ended September 30, 2009. In this press release, unless otherwise indicated, all dollar amounts are expressed in Canadian dollars and have been rounded to nearest hundred.
Q3-2009 Highlights
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Revenues grew 71.9% over the same three-month period in 2008
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Gross profit grew by 41.7% for the quarter
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Net income for the quarter grew by 42.9%
·
Fourth consecutive quarter the Company has generated a profit
Total operating revenues from all sources increased to $826,900 in Q3-2009 from $481,100 in Q3-2008. This was driven by 7.9% and 303.1% growth in Canadian and International sales, respectively. The gross margin percentage decreased to 66.0% in Q3-2009 compared to 77.7% in Q3-2008 largely as a result of the Company’s strong growth in international sales where Stellar’s margins are reduced. Stellar’s Q3-2009 net profit was $25,900 compared to a net loss of $60,300 in Q3-2008.
For the nine-month period ended September 30, 2009, Stellar's total operating revenues from all sources were $2,673,700. This was up 61.4% from$1,656,400 for the same period in 2008 and was driven by 16.6% and 169.9% growth in Canadian and International sales, respectively. Net income for the 2009 nine-month period was $215,800, or $0.01 per share, compared to a loss of $227,100, or ($0.01) per share, in the same 2008 period.
Peter Riehl, Stellar’s President and Chief Executive Officer, commented,"Despite the difficult economic environment, we entered 2009 confident that our focus on building Canadian sales and expanding global partnerships for Uracyst® and NeoVisc® would generate improved operating performance throughout the year. These third quarter financial results demonstrate the success of that focus. We continue to make considerable progress on all fronts. The shift in awareness and acceptance of our two lead products by scientists and clinicians is growing, sales traction in Canada continues to build, and we are increasingly benefiting from the aggressive expansion of our global out-licensing program. I am pleased to report, that thus far in the fourth quarter, we are seeing these positive trends continue."
About Stellar Pharmaceuticals Inc.
Stellar has developed and is marketing direct in Canada and in countries around the world through out-license agreements two products based on its core polysaccharide technology: NeoVisc®, for the treatment of osteoarthritis; and Uracyst®, its patented technology for treatment of interstitial cystitis/painful bladder syndrome, an inflammatory disease of the urinary bladder wall. Stellar also has in-licensing agreement for the distribution and sale of NMP22® BladderChek®, a proteomics-based diagnostic test for the diagnosis and monitoring of bladder cancer.
Forward-looking Statements
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties impacting the Company's business including increased competition; the ability of the Company to expand its operations, to attract and retain qualified professionals, technological obsolescence; general economic conditions; and other risks detailed from time to time in the Company's filings.
For more information contact:
Stellar Pharmaceuticals Inc.
Peter Riehl
President & CEO
(800) 639-0643 or (519) 434-1540
Or
Arnold Tenney
(705) 445-9505
Or
Stephen Kilmer
Kilmer Lucas Inc.
905-690-2400 ext. 21
stephen@kilmerlucas.com
STELLAR PHARMACEUTICALS INC.
CONDENSED BALANCE SHEETS
(Expressed in Canadian Dollars)
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| As at September 30, 2009 |
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| As at December 31, 2008 |
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ASSETS |
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CURRENT |
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Cash and cash equivalents |
| $ | 1,913,194 |
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| $ | 2,105,966 |
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Accounts receivable, net of allowance $nil (2008 - $nil) |
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| 376,683 |
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| 549,055 |
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Inventories |
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| 582,036 |
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| 364,551 |
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Taxes recoverable |
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| 216,147 |
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| 212,445 |
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Loan receivable |
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| 18,369 |
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| 18,369 |
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Prepaids, deposits and sundry receivables |
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| 227,411 |
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| 130,515 |
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| 3,333,840 |
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| 3,380,901 |
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PROPERTY, PLANT AND EQUIPMENT |
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| 1,315,236 |
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| 1,270,257 |
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OTHER ASSETS |
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| 90,711 |
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| 65,495 |
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| $ | 4,739,787 |
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| $ | 4,716,653 |
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LIABILITIES |
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CURRENT |
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Accounts payable |
| $ | 133,960 |
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| $ | 173,812 |
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Accrued liabilities |
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| 56,875 |
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| 186,201 |
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Deferred revenues |
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| 8,897 |
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| 1,749 |
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| 199,732 |
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| 361,762 |
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CONTINGENCIES AND COMMITMENTS |
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SHAREHOLDERS’ EQUITY |
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CAPITAL STOCK |
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AUTHORIZED |
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Unlimited Non-voting, convertible, redeemable, and retractable preferred shares with no par value |
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Unlimited Common shares with no par value |
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ISSUED |
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23,495,040 Common shares (2008 – 23,702,540) |
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| 8,188,486 |
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| 8,261,403 |
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(15,000) - Treasury shares (2008 – (147,500)) |
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| (9,293 | ) |
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| (51,625 | ) |
Additional paid-in capital for cancelled common shares |
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| 2,329 |
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| 2,329 |
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Additional paid-in capital options - outstanding |
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| 34,209 |
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| 35,965 |
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- expired |
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| 724,128 |
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| 722,372 |
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| 8,939,859 |
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| 8,970,444 |
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DEFICIT |
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| (4,399,804 | ) |
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| (4,615,553 | ) |
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| 4,540,055 |
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| 4,354,891 |
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| $ | 4,739,787 |
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| $ | 4,716,653 |
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STELLAR PHARMACEUTICALS INC.
CONDENSED INTERIM STATEMENTS OF OPERATIONS
AND COMPREHENSIVE LOSS AND DEFICIT
(Expressed in Canadian Dollars)
(Unaudited)
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| For the Three Month Period |
| For the Nine Month Period |
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| 2009 |
| 2008 |
| 2009 |
| 2008 |
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PRODUCT SALES |
| $ | 811,684 |
| $ | 477,289 |
| $ | 2,270,229 |
| $ | 1,452,280 |
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COST OF PRODUCTS SOLD |
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| 275,710 |
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| 106,473 |
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| 763,744 |
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| 366,804 |
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MARGIN ON PRODUCTS SOLD |
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| 535,974 |
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| 370,816 |
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| 1,506,485 |
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| 1,085,476 |
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ROYALTY AND LICENSING REVENUES |
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| 15,233 |
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| 3,780 |
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| 403,498 |
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| 204,136 |
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GROSS PROFIT |
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| 551,207 |
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| 388,910 |
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| 1,909,983 |
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| 1,289,612 |
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EXPENSES |
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Selling, general and administrative |
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| 505,391 |
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| 453,362 |
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| 1,646,388 |
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| 1,496,246 |
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Research and development |
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| 9,009 |
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| (4,805 | ) |
| 16,420 |
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| 53,437 |
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Amortization (non-)manufacturing property, plant and equipment |
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| 14,488 |
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| 14,625 |
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| 41,888 |
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| 43,769 |
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| 528,888 |
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| 463,182 |
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| 1,704,696 |
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| 1,593,452 |
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INCOME (LOSS) FROM OPERATIONS |
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| 22,319 |
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| (88,586 | ) |
| 205,287 |
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| (303,840 | ) |
INTEREST AND OTHER INCOME |
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| 3,559 |
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| 18,627 |
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| 10,462 |
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| 67,050 |
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GAIN ON DISPOSAL OF EQUIPMENT |
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| –– |
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| 9,676 |
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| –– |
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| 9,676 |
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NET INCOME (LOSS) AND COMPREHENSIVE |
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INCOME (LOSS) FOR THE PERIOD |
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BEFORE INCOME TAXES |
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| 25,878 |
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| (60,283 | ) |
| 215,749 |
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| (227,114 | ) |
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Current income tax expense |
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| (10,100 | ) |
| –– |
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| (18,200 | ) |
| –– |
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Future income tax recovery |
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| 10,100 |
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| –– |
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| 18,200 |
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| –– |
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DEFICIT, beginning of period |
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| (4,425,682 | ) |
| (4,746,385 | ) |
| (4,615,553 | ) |
| (4,576,621 | ) |
Effect of repurchase and cancellation of Common Shares |
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| –– |
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| (1,876 | ) |
| –– |
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| (4,809 | ) |
DEFICIT, end of period |
| $ | (4,399,804 | ) | $ | (4,808,54 | ) | $ | (4,399,804 | ) | $ | (4,808,544 | ) |
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EARNINGS (LOSS) PER SHARE -basic and diluted |
| $ | 0.00 |
| $ | (0.00 | ) | $ | 0.01 |
| $ | (0.01 | ) |
WEIGHTED AVERAGE NUMBER OF |
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COMMON SHARES OUTSTANDING |
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| 23,493,736 |
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| 23,681,779 |
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| 23,505,241 |
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| 23,752,790 |
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STELLAR PHARMACEUTICALS INC.
CONDENSED INTERIM STATEMENTS OF CASH FLOWS
(Expressed in Canadian Dollars)
(Unaudited)
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| For the Three Month Period |
| For the Nine Month Period |
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| 2009 |
| 2008 |
| 2009 |
| 2008 |
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CASH FLOWS FROM (USED IN) OPERATING |
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Net income (loss) for the period |
| $ | 25,878 |
| $ | (60,283 | ) | $ | 215,749 |
| $ | (227,114 | ) |
Items not affecting cash |
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Amortization |
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| 15,769 |
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| 28,939 |
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| 83,885 |
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| 89,367 |
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Unrealized foreign exchange (gain) loss |
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| 5,247 |
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| (8,042 | ) |
| 18,353 |
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| (14,399 | ) |
Gain on sale of asset |
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| –– |
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| (9,676 | ) |
| –– |
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| (9,676 | ) |
Issuance of equity instruments for services rendered |
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| –– |
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| 3,603 |
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| –– |
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| 16,730 |
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Change in non-cash operating asset and liabilities |
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| 65,698 |
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| 35,832 |
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| (322,815 | ) |
| (65,808 | ) |
CASH FLOWS USED IN OPERATING ACTIVITIES |
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| 112,593 |
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| (9,627 | ) |
| (4,827 | ) |
| (210,900 | ) |
CASH FLOWS FROM (USED IN) INVESTING |
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Additions to property, plant and equipment |
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| (66,899 | ) |
| (152,373 | ) |
| (112,776 | ) |
| (354,008 | ) |
Increase to other assets |
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| –– |
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| (5,357 | ) |
| (26,231 | ) |
| (11,420 | ) |
Sale of equipment |
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| –– |
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| 10,000 |
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| –– |
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| 10,000 |
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CASH FLOWS USED IN INVESTING ACTIVITIES |
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| (66,899 | ) |
| (147,730 | ) |
| (139,007 | ) |
| (355,428 | ) |
CASH FLOWS USED IN FINANCING ACTIVITIES - |
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Repurchase of common shares for cash |
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| (9,293 | ) |
| (20,729 | ) |
| (30,584 | ) |
| (64,384 | ) |
CASH FLOWS USED IN FINANCING ACTIVITIES |
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| (9,293 | ) |
| (20,729 | ) |
| (30,584 | ) |
| (64,384 | ) |
EFFECT OF EXCHANGE RATES ON CASH HELD IN |
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FOREIGN CURRENCY |
|
| (5,247 | ) |
| 8,041 |
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| (18,354 | ) |
| 14,397 |
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CHANGE IN CASH AND CASH EQUIVALENTS |
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| 31,154 |
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| (170,045 | ) |
| (192,772 | ) |
| (616,315 | ) |
CASH AND CASH EQUIVALENTS, |
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Beginning of period |
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| 1,882,040 |
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| 2,764,856 |
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| 2,105,966 |
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| 3,211,126 |
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CASH AND CASH EQUIVALENTS, |
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End of period |
| $ | 1,913,194 |
| $ | 2,594,811 |
| $ | 1,913,194 |
| $ | 2,594,811 |
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#######