Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended | |
Sep. 30, 2013 | Nov. 08, 2013 | |
Entity Information [Line Items] | ' | ' |
Entity Registrant Name | 'ESCALON MEDICAL CORP. | ' |
Entity Central Index Key | '0000862668 | ' |
Current Fiscal Year End Date | '--06-30 | ' |
Entity Filer Category | 'Smaller Reporting Company | ' |
Document Type | '10-Q | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 7,526,430 |
Entity Well-known Seasoned Issuer | 'No | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Jun. 30, 2013 |
Pension and Other Postretirement Defined Benefit Plans, Current Liabilities | $101,891 | $101,891 |
ASSETS | ' | ' |
Cash and cash equivalents | 2,793,608 | 2,654,701 |
Accounts receivable, net | 1,559,494 | 1,725,841 |
Inventory, net | 2,160,292 | 1,853,686 |
Other current assets | 224,259 | 288,598 |
Total current assets | 6,737,653 | 6,522,826 |
Property and equipment, net | 14,799 | 12,594 |
Goodwill | 125,027 | 125,027 |
Trademarks and trade names | 605,006 | 605,006 |
Patents, net | 6,000 | 6,712 |
Total assets | 7,488,485 | 7,272,165 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ' | ' |
Accounts payable | 1,154,665 | 672,926 |
Accrued expenses | 910,722 | 1,171,281 |
Liabilities of discontinued operations | 573,435 | 573,435 |
Total current liabilities | 2,740,713 | 2,519,533 |
Accrued post-retirement benefits | 903,448 | 923,706 |
Total long-term liabilities | 903,448 | 923,706 |
Total liabilities | 3,644,161 | 3,443,239 |
Shareholders equity: | ' | ' |
Preferred stock, $0.001 par value; 2,000,000 shares authorized; no shares issued | 0 | 0 |
Common stock, $0.001 par value; 35,000,000 shares authorized; 7,526,430 issued and outstanding at December 31, 2012 and June 30, 2012 | 7,526 | 7,526 |
Common stock warrants | 132,114 | 132,114 |
Additional paid-in capital | 69,415,785 | 69,413,628 |
Accumulated deficit | -65,711,101 | -65,724,342 |
Total shareholders' equity | 3,844,324 | 3,828,926 |
Total liabilities and shareholders' equity | $7,488,485 | $7,272,165 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 35,000,000 | 35,000,000 |
Common stock, shares issued | 7,526,430 | 7,526,430 |
Common stock, shares outstanding | 7,526,430 | 7,526,430 |
Consolidated_Statements_Of_Ope
Consolidated Statements Of Operations (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Net revenues: | ' | ' |
Product revenue | $3,130,083 | $2,269,577 |
Revenues, net | 3,130,083 | 2,269,577 |
Costs and expenses: | ' | ' |
Cost of goods sold | 1,556,214 | 1,196,398 |
Marketing, general and administrative | 1,212,962 | 1,405,586 |
Research and development | 323,190 | 264,198 |
Total costs and expenses | 3,092,366 | 2,866,182 |
Loss from operations | 37,717 | -596,605 |
Other (expense) income: | ' | ' |
Other Nonoperating Income (Expense) | 1,068 | 64,781 |
Interest income | 61 | 24 |
Interest expense | 0 | -92,596 |
Total other (expense) income | 1,129 | -27,791 |
Net income (loss) from continuing operations | 38,846 | -624,396 |
Income (Loss) from Discontinued Operation, before Income Tax | -25,605 | 190,960 |
Income tax expense | 0 | 0 |
Income (Loss) from Discontinued Operations, Net of Tax | -25,605 | 190,960 |
Net income (loss) | $13,241 | ($433,436) |
Basic: | ' | ' |
Continuing Operations | $0 | ($0.08) |
Discontinued Operations | $0 | $0.02 |
Net income (loss) | $0 | ($0.06) |
Diluted: | ' | ' |
Continuing Operations | $0 | ($0.08) |
Discontinued operations | $0 | $0.02 |
Net income (loss) | $0 | ($0.06) |
Weighted Average Number of Shares Outstanding, Basic | 7,526,430 | 7,526,430 |
Weighted Average Number of Shares Outstanding, Diluted | 7,558,097 | 7,526,430 |
Consolidated_Statements_Of_Sha
Consolidated Statements Of Shareholders' Equity and Comprehensive Loass (USD $) | Total | Common Stock [Member] | Common Stock Warrants [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] |
Balance at Jun. 30, 2013 | $3,828,926 | $7,526 | $132,114 | $69,413,628 | ($65,724,342) |
Balance, shares at Jun. 30, 2013 | ' | 7,526,430 | ' | ' | ' |
Net income | 13,241 | 0 | 0 | 0 | 13,241 |
Compensation expense | 2,157 | 0 | 0 | 2,157 | 0 |
Balance at Sep. 30, 2013 | $3,844,324 | $7,526 | $132,114 | $69,415,785 | ($65,711,101) |
Balance, shares at Sep. 30, 2013 | ' | 7,526,430 | ' | ' | ' |
Consolidated_Statements_Of_Cas
Consolidated Statements Of Cash Flows (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Cash Flows from Operating Activities: | ' | ' |
Net income (loss) | $13,241 | ($433,436) |
Adjustments to reconcile net income (loss) to cash provided by operating activities of continuing operations: | ' | ' |
Income (loss) from discontinued operations | -25,605 | 190,960 |
Depreciation and amortization | 2,850 | 3,743 |
Compensation expense related to stock options | 2,157 | 16,485 |
Increase (Decrease) in Pension and Postretirement Obligations | -20,258 | 0 |
Other income | 0 | 1,192 |
Change in operating assets and liabilities: | ' | ' |
Accounts receivable, net | 166,348 | 413,431 |
Inventory, net | -306,606 | -359,325 |
Other current and long-term assets | 64,338 | 28,612 |
Accounts payable and accrued expenses | 221,180 | -204,303 |
Net cash (used in) operating activities from continuing operations | 168,855 | -726,945 |
Net cash provided by (used in) operating activities from discontinued operations | -25,605 | 455,942 |
Net cash (used in) operating activities | 143,250 | -271,003 |
Cash Flows from Investing Activities: | ' | ' |
Purchase of fixed assets | -4,343 | 0 |
Net cash (used in) investing activities from continuing operations | -4,343 | 0 |
Proceeds from Sale of Drew assets | ' | 6,175,000 |
Purchase of fixed assets, discontinued opeartion | 0 | -8,618 |
Net cash provided by (used in) investing activities from discontinued operations | 0 | -8,618 |
Net cash provided by (used in) investing activities | -4,343 | -8,618 |
Cash Flows from Financing Activities: | ' | ' |
Effect of exchange rate changes on cash and cash equivalents | 0 | -60,643 |
Net increase (decrease) in cash and cash equivalents | 138,907 | -340,264 |
Cash and cash equivalents, beginning of period | 2,654,701 | ' |
Cash and cash equivalents, end of period | 2,793,608 | 550,359 |
Income Taxes Paid | $25,000 | $0 |
Consolidated_Statement_of_Othe
Consolidated Statement of Other Comprehensive Income (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Net income (loss) | $13,241 | ($433,436) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, before Tax | 0 | -61,829 |
Total comprehensive income (loss) | $13,241 | ($495,265) |
Note_11_Composition_of_Certain
Note 11. Composition of Certain Financial Statement Caption Statement (USD $) | Sep. 30, 2013 | Jun. 30, 2013 |
Inventory Disclosure [Abstract] | ' | ' |
Inventory, Raw Materials, Net of Reserves | $1,195,000 | $742,000 |
Inventory, Work in Process, Net of Reserves | 215,000 | 414,000 |
Inventory, Finished Goods, Net of Reserves | 750,000 | 698,000 |
Inventory, net | $2,160,292 | $1,853,686 |
Note_1_Basis_of_Presentation
Note. 1 Basis of Presentation | 3 Months Ended |
Sep. 30, 2013 | |
Entity Information [Line Items] | ' |
Business Description and Basis of Presentation [Text Block] | ' |
1. Basis of Presentation | |
Escalon Medical Corp. (“Escalon” or the “Company” ) is a Pennsylvania corporation initially incorporated in California in 1987, and reincorporated in Pennsylvania in November 2001. Within this document, the “Company” collectively shall mean Escalon and its wholly owned subsidiaries: Sonomed, Inc. (“Sonomed”), Trek, Inc. (“Trek”), Escalon Medical Europe GmbH (“EME”), Escalon Digital Solutions, Inc. (“EMI”), Escalon Pharmaceutical, Inc. (“Pharmaceutical” inactive), Escalon Holdings, Inc. (“EHI”), Escalon IP Holdings, Inc., Sonomed IP Holdings, Inc., Drew Scientific Holdings, Inc. (discontinued), Drew Scientific Inc. (discontinued), and Drew Scientific Group, Plc (“Drew”) and its subsidiaries (discontinued). All intercompany accounts and transactions have been eliminated. | |
On October 3, 2012 the Company sold its Clinical Diagnostics Business to ERBA Diagnostics, Inc. The Escalon Clinical Diagnostics Business ("ECD") consists of Drew Scientific, Inc., and its wholly owned subsidiaries JAS Diagnostics, Inc. ("JAS") and Drew Scientific Limited Co. The sales price was $6,500,000 in cash. The sale of this business will have a material effect on earnings in subsequent periods. ECD prior period amounts are presented as discontinued operations (see footnote 10 to the Notes to Condensed Consolidated Financial Statements for additional information). | |
On October 18, 2012, the Company and its debt holder reached an agreement whereby the Company paid the balance of the seller-provided financing plus accrued interest related to the purchase of certain assets of BH Holdings, S.A.S ("Biocode" or "BHH") of $4,367,604 with a one-time payment of $2,487,480 resulting in a gain on extinguishment of debt of $1,880,124 which was included in discontinued operations. The repayment of the debt has reduced the Company's debt related to Biocode to zero. | |
As a result of these transactions the Company realized total gains of $4,019,000. The total gain brought the Company back into compliance with the minimum $2,500,000 stockholders' equity requirement for continued listing on the NASDAQ Capital Market as set forth in Listing Rule 5550(b). | |
The Company operates in the healthcare market, specializing in the development, manufacture, marketing, and distribution of medical devices and pharmaceuticals in the area of ophthalmology. The Company and its products are subject to regulation and inspection by the United States Food and Drug Administration (the “FDA”). The FDA and other governmental authorities require extensive testing of new products prior to sale and have jurisdiction over the safety, efficacy and manufacture of products, as well as product labeling and marketing. | |
Management reviews financial information, allocates resources, and manages the business as two segments: Sonomed-Escalon and Escalon Medical Corp. (“Corporate”). The Sonomed-Escalon segment consists of Sonomed, Inc., EMI and Trek, all of which are engaged in the development and sale of Ophthalmic medical devices. The Escalon Medical Corp. segment includes the administrative corporate operations of the consolidated group. |
Note_2_StockBased_Compensation
Note 2. Stock-Based Compensation | 3 Months Ended |
Sep. 30, 2013 | |
2. Stock-Based Compensation [Abstract] | ' |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | ' |
2. Stock-Based Compensation | |
Valuations are based upon highly subjective assumptions about the future, including stock price volatility and exercise patterns. The fair value of share-based payment awards was estimated using the Black-Scholes option pricing model. Expected volatilities are based on the historical volatility of the Company's stock. The Company uses historical data to estimate option exercise and employee terminations. The expected term of options granted represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. | |
The Company has historically granted options under the Company's option plans with an option exercise price equal to the closing market value of the stock on the date of the grant and with vesting, primarily for Company employees, either in equal annual amounts over a two- to five-year period or immediately, and, primarily for non-employee directors, immediately. | |
As of September 30, 2013 and 2012 total unrecognized compensation cost related to non-vested share-based compensation arrangements granted to employees under the 2004 Equity Incentive Plan was $8,629 and $38,271, respectively. The remaining cost is expected to be recognized over a weighted average period of 1 year. For the three-month periods ended September 30, 2013 and 2012, $2,157 and $16,485 was recorded as compensation expense, respectively. | |
The Company did not receive any cash from share option exercises under stock-based payment plans for the three-month periods ended September 30, 2013 and 2012. The Company did not realize any tax effect, which would be a reduction in its tax rate, on options due to the full valuation allowances established on its deferred tax assets. | |
The Company measures compensation expense for non-employee stock-based compensation based on the fair value of the options issued, as this is more reliable than the fair value of the services received. Fair value is measured as the value of the Company's common stock on the date that the commitment for performance by the counterparty has been reached or the counterparty's performance is complete. The fair value of the equity instrument is charged directly to compensation expense and additional paid-in capital. There was no non-employee compensation expense for the three-month periods ended September 30, 2013 and 2012. |
Note_3_Earning_per_Share
Note 3. Earning per Share | 3 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Earnings Per Share [Text Block] | ' | ||||||||
3. Net Income (Loss) earnings per Share | |||||||||
The following table sets forth the computation of basic and diluted net income (loss) per share: | |||||||||
Three Months Ended September 30 | |||||||||
2013 | 2012 | ||||||||
Numerator: | |||||||||
Numerator for basic and diluted earnings per share | |||||||||
Income (loss) from continuing operations | $ | 38,846 | $ | (624,396 | ) | ||||
(Loss) income from discontinued operations | (25,605 | ) | 190,960 | ||||||
Net income (loss) | $ | 13,241 | $ | (433,436 | ) | ||||
Denominator: | |||||||||
Denominator for basic earnings per share - weighted average shares | 7,526,430 | 7,526,430 | |||||||
Effect of dilutive securities: | |||||||||
Stock options and warrants | 31,667 | — | |||||||
Shares reserved for future exchange | — | — | |||||||
Denominator for diluted earnings per share - weighted average and assumed conversion | 7,558,097 | 7,526,430 | |||||||
Net income (loss) income per share | |||||||||
Basic: | |||||||||
Continuing operations | $ | — | $ | (0.08 | ) | ||||
Discontinued operations | — | 0.02 | |||||||
$ | — | $ | (0.06 | ) | |||||
Diluted: | |||||||||
Continuing operations | $ | — | $ | (0.08 | ) | ||||
Discontinued operations | — | 0.02 | |||||||
$ | — | $ | (0.06 | ) | |||||
Note_4_Legal_proceeding
Note 4. Legal proceeding | 3 Months Ended |
Sep. 30, 2013 | |
4. Legal Proceedings [Abstract] | ' |
Legal Matters and Contingencies [Text Block] | ' |
4. Legal Proceedings | |
The Company, from time to time, is involved in various legal proceedings and disputes that arise in the normal course of business. These matters have previously and may in the future pertain to intellectual property disputes, commercial contract disputes, employment disputes, and other matters. The Company does not believe that the resolution of any of these matters has had or is likely to have a material adverse impact on the Company's business, financial condition or results of operations. |
Note_5_Segment_Reporting
Note 5. Segment Reporting | 3 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||||||||||
Segment Reporting | ' | ||||||||||||||||||||||||
5. Segment Reporting | |||||||||||||||||||||||||
During the three-month periods ended September 30, 2013 and 2012, the Company's continuing operations were classified into two principal reportable business units that provide different products or services. | |||||||||||||||||||||||||
Management reviews financial information, allocates resources, and manages the business as two segments: Sonomed-Escalon and Escalon Medical Corp. (“Corporate”). The Sonomed-Escalon segment consists of Sonomed, Inc., EMI and Trek, all of which are engaged in the development and sale of ophthalmic medical devices. The Corporate segment includes the administrative corporate operations of the consolidated group. The ECD segment which consisted of Drew Scientific, Inc., and its wholly owned subsidiary JAS, was reported under discontinued operations beginning with the Form 10-Q for three months ended September 30, 2012. | |||||||||||||||||||||||||
Separate management of each unit is required because each business unit is subject to different marketing, production and technology strategies. | |||||||||||||||||||||||||
The table below sets forth the income/losses from continuing operations for the three-months ended September 30, 2013 and 2012 (in thousands). | |||||||||||||||||||||||||
Sonomed-Escalon | Corporate | Total | |||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||
Revenues, net: | |||||||||||||||||||||||||
Product revenue | $ | 3,130 | $ | 2,270 | $ | — | $ | — | $ | 3,130 | $ | 2,270 | |||||||||||||
Total revenue, net | 3,130 | 2,270 | — | — | 3,130 | 2,270 | |||||||||||||||||||
Costs and expenses: | |||||||||||||||||||||||||
Cost of goods sold | 1,556 | 1,196 | — | — | 1,556 | 1,196 | |||||||||||||||||||
Marketing, general & admin | 1,138 | 1,304 | 75 | 102 | 1,213 | 1,406 | |||||||||||||||||||
Research & development | 323 | 264 | — | — | 323 | 264 | |||||||||||||||||||
Total costs and expenses | 3,018 | 2,764 | 75 | 102 | 3,092 | 2,866 | |||||||||||||||||||
(Loss) from operations | 112 | (494 | ) | (75 | ) | (102 | ) | 38 | (596 | ) | |||||||||||||||
Other (expense) and income: | |||||||||||||||||||||||||
Interest income | — | — | — | — | — | — | |||||||||||||||||||
Other income | — | — | 1 | 65 | 1 | 65 | |||||||||||||||||||
Interest expense | — | — | — | (93 | ) | — | (93 | ) | |||||||||||||||||
Total other (expense) and income | — | — | 1 | (28 | ) | 1 | (28 | ) | |||||||||||||||||
Income (loss) before taxes | 112 | (494 | ) | (74 | ) | (130 | ) | 39 | (624 | ) | |||||||||||||||
Income taxes (benefits) from continuing operations | — | — | — | — | — | — | |||||||||||||||||||
Net income (loss) from continuing operations | $ | 112 | $ | (494 | ) | $ | (74 | ) | $ | (130 | ) | $ | 39 | $ | (624 | ) | |||||||||
The Company operates in the healthcare market, specializing in the development, manufacture and marketing of ophthalmic medical devices and pharmaceuticals. The business segments reported above are the segments for which separate financial information is available and for which operating results are evaluated regularly by executive management in deciding how to allocate resources and assessing performance. The accounting policies of the business segments are the same as those described in the summary of significant accounting policies in the Company's Form 10-K for the year ended June 30, 2013. For the purposes of this illustration, corporate expenses, which consist primarily of executive management and administrative support functions, are allocated across the business segments based upon a methodology that has been established by the Company, which includes a number of factors and estimates and that has been consistently applied across the business segments. These expenses are otherwise included in the corporate segment. | |||||||||||||||||||||||||
During the three-month periods ended September 30, 2013 and 2012, Sonomed-Escalon derived its revenue from the sale of A-Scans, B-Scans, UBM, pachymeters, Digital imaging products, ISPAN™ gas products and various disposable ophthalmic surgical products. |
Note_6_Related_Party_Transacti
Note 6. Related Party Transactions | 3 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions [Abstract] | ' |
Related Party Transactions | ' |
6. Related Party Transactions | |
Escalon and a former member of the Company’s Board of Directors are founding and equal members of Ocular Telehealth Management, LLC (“OTM”). OTM is a diagnostic telemedicine company providing remote examination, diagnosis and management of disorders affecting the human eye. OTM’s initial solution focuses on the diagnosis of diabetic retinopathy by creating access and providing annual dilated retinal examinations for the diabetic population. OTM was founded to harness the latest advances in telecommunications, software and digital imaging in order to create greater access and a more successful disease management for populations that are susceptible to ocular disease. Through June 30, 2013, Escalon had invested $444,000 in OTM and owned 45% of OTM. The Company provided administrative support functions to OTM. For the three-month periods ended September 30, 2013 and 2012, the Company recorded a gain of $0 and $1,000, respectively. On May 9, 2013 the board member related to OTM resigned from the board of directors and is therefore no longer a related party. Additionally, the Company has come to an understanding with OTM to discontinue any additional efforts and investment related to OTM and wrote off its remaining investment in OTM during the fourth quarter of the fiscal year ended June 30, 2013. | |
During the three-month period ended September 30, 2012, Richard J. DePiano, Sr., the Company’s Chief Executive Officer, participated in an accounts receivable factoring program that was implemented by the Company. Under the program, Mr. DePiano advanced the Company $300,000 which represented 80% of an amount due from certain Drew customers. The receivables were not eligible to be sold to the Company’s usual factoring agent. Interest on the transaction was 1.25% per month, which was equal to the best price offered by the Company’s usual factoring agent. The transaction excluded fees typically charged by the factoring agent and provided much needed liquidity to the Company. Related party interest expense for the three-month periods ended September 30, 2013 and 2012 was $0 and $11,250, respectively. The entire amount due of $332,216 including accrued interest of $32,216, was paid in full on October 5, 2012. |
Note_7_Recently_Issued_Account
Note 7. Recently Issued Accounting Standards | 3 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | ' |
7. Recently Issued Accounting Standards | |
In July 2013, the FASB issued ASU 2013-11, Income Taxes (Topic 740), which clarifies the presentation requirements of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013 and should be applied prospectively. The adoption of this ASU is not expected to have a material impact to the Company’s consolidated financial statements. | |
In February 2013, FASB issued Accounting Standards Update 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income to improve the transparency of reporting these reclassifications. Other comprehensive income (loss) includes gains and losses that are initially excluded from net income for an accounting period. Those gains and losses are later reclassified out of accumulated other comprehensive income into net income. The amendments in this ASU do not change the current requirements for reporting net income or other comprehensive income in financial statements. All of the information that this ASU requires already is required to be disclosed elsewhere in the financial statements under U.S. GAAP. The new amendments will require an organization to (i) present the effects on the line items of net income of significant amounts reclassified out of accumulated other comprehensive income, but only if the item reclassified is required under U.S. GAAP to be reclassified to net income in its entirety in the same reporting period; and (ii) cross-reference to other disclosures currently required under U.S. GAAP for other reclassification items to be reclassified directly to net income in their entirety in the same reporting period. The amendments are effective for interim and annual reporting periods beginning after December 15, 2012. The adoption of this standard did not have a material impact to the Company’s consolidated financial statements. |
Note_8_Fair_Value_Measurements
Note 8. Fair Value Measurements | 3 Months Ended |
Sep. 30, 2013 | |
Fair Value Disclosures [Abstract] | ' |
Fair Value Measurements | ' |
8. Fair Value Measurements | |
On July 1, 2008, the Company adopted the FASB-issued authoritative guidance for the fair value of financial assets and liabilities. This standard defines fair value and establishes a hierarchy for reporting the reliability of input measurements used to assess fair value for all assets and liabilities. The FASB-issued authoritative guidance defines fair value as the selling price that would be received for an asset, or paid to transfer a liability, in the principal or most advantageous market on the measurement date. The hierarchy prioritizes fair value measurements based on the types of inputs used in the valuation technique. The inputs are categorized into the following levels: | |
Level 1—Observable inputs such as quoted prices in active markets for identical assets or liabilities. | |
Level 2—Directly or indirectly observable inputs for quoted and other than quoted prices for identical or similar assets and liabilities in active or non-active markets. | |
Level 3—Unobservable inputs not corroborated by market data, therefore requiring the entity to use the best available information available in the circumstances, including the entity’s own data. | |
Certain financial instruments are carried at cost on the consolidated balance sheets, which approximates fair value due to their short-term, highly liquid nature. These instruments include cash and cash equivalents, accounts receivable, accounts payable, and accrued expenses. |
Note_9_Continuing_operations
Note. 9 Continuing operations | 3 Months Ended |
Sep. 30, 2013 | |
Continuing Operations [Abstract] | ' |
Quarterly Financial Information [Text Block] | ' |
9. Continuing Operations | |
The accompanying condensed consolidated financial statements have been prepared on the going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. | |
Based on the following transactions, the Company expects that these transactions will provide the Company with sufficient cash to fund its operations over the next 12 months. | |
On October 3, 2012 the Company sold its Clinical Diagnostics Business to ERBA Diagnostics, Inc. The ECD consisted of Drew Scientific, Inc., and its wholly owned subsidiaries JAS and Drew Scientific Limited Co. The sales price was $6,500,000 in cash and the transaction generated a gain on sale of approximately $2,717,000. | |
On October 18, 2012, the Company and its debt holder reached an agreement whereby the Company paid the balance of the seller-provided financing plus accrued interest related to the purchase of certain assets of Biocode of $4,367,604 with a one-time payment of $2,487,480 resulting in a gain on extinguishment of debt of $1,880,124. The repayment of the debt has reduced the Company's debt related to Biocode to zero. | |
As a result of these transactions the Company realized total gains of $4,019,000 before tax during fiscal year 2013 including $578,422 of cumulative translation adjustment reversal related to the ECD segment. The total gain brought the Company back into compliance with the minimum $2,500,000 stockholders' equity requirement for continued listing on the NASDAQ Capital Market as set forth in Listing Rule 5550(b). |
Note_10_Discontinued_Operation
Note 10. Discontinued Operations | 3 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | |||||||
Discontinued Operations | ' | |||||||
10. Discontinued Operations | ||||||||
BH Holdings, S.A.S | ||||||||
On January 12, 2012 BHH initiated the filing of an insolvency declaration with the Tribunal de Commerce de Rennes, France ("Commercial Court"). The Commercial Court on January 18, 2012 opened the liquidation proceedings with continuation of BHH's activity for 3 months and named an administrator to manage BHH. Since Drew no longer had a controlling financial interest in BHH it was deconsolidated in the December 31, 2011 quarterly condensed consolidated financial statements and prior period amounts were presented as discontinued operations. | ||||||||
Assets and liabilities of discontinued operations of BHH included in the condensed consolidated balance sheets are summarized as follows at September 30, 2013 and June 30, 2013 (in thousands): | ||||||||
30-Sep | June 30, | |||||||
2013 | 2013 | |||||||
Total assets | $ | — | $ | — | ||||
Liabilities | ||||||||
Accrued lease termination costs | 518 | 493 | ||||||
Total liabilities | 518 | 493 | ||||||
Net liabilities of discontinued operations | $ | (518 | ) | $ | (493 | ) | ||
Discontinued operation of ECD | ||||||||
On October 3, 2012 the Company sold its Clinical Diagnostics Business to ERBA Diagnostics, Inc. The ECD consisted of Drew Scientific, Inc., and its wholly owned subsidiaries JAS and Drew Scientific Limited Co. The sales price was $6,500,000 in cash and gain on sale of assets was approximately $2,717,000. The following table is in thousands: | ||||||||
3-Oct-12 | ||||||||
Sales Price | $ | 6,500 | ||||||
Broker's fee | (325 | ) | ||||||
Net Proceeds | 6,175 | |||||||
Net Assets Sold | (3,458 | ) | ||||||
Gain on Sale of Assets | $ | 2,717 | ||||||
Net assets sold | ||||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 4 | ||||||
Accounts receivable, net | 1,661 | |||||||
Inventory, net | 1,997 | |||||||
Other current assets | 113 | |||||||
Furniture and equipment, net | 287 | |||||||
Goodwill | 93 | |||||||
Trademarks and trade names, net | 89 | |||||||
Customer list, net | 462 | |||||||
Total Assets | 4,706 | |||||||
Liabilities: | ||||||||
Accounts payable | 639 | |||||||
Accrued expenses | 609 | |||||||
Total liabilities | 1,248 | |||||||
Net assets sold | $ | 3,458 | ||||||
On October 18, 2012, the Company and its debt holder reached an agreement whereby the Company paid the balance of the seller-provided financing plus accrued interest related to the purchase of certain assets of Biocode of $4,367,604 with a one-time payment of $2,487,480 resulting in a gain on extinguishment of debt of $1,880,124. The repayment of the debt has reduced the Company's debt related to Biocode to zero. | ||||||||
The following tables summarize the results of discontinued operations for the three months ended September 30, 2013 and 2012 (in thousands): | ||||||||
For the three-month period ended September 30, | 2013 | 2012 | ||||||
Revenue, net | $ | — | $ | 3,637 | ||||
Cost of goods sold | — | 2,194 | ||||||
Marketing, general and administrative | 26 | 1,176 | ||||||
Research & development | — | 76 | ||||||
Total costs and expenses | 26 | 3,446 | ||||||
Net (loss) income from discontinued operations | $ | (26 | ) | $ | 191 | |||
Assets and liabilities of discontinued operations of ECD included in the condensed consolidated balance sheets are summarized as follows at September 30, 2013 and June 30, 2013 (in thousands): | ||||||||
September 30, | June 30, | |||||||
2013 | 2013 | |||||||
Total Assets | $ | — | $ | — | ||||
Liabilities | ||||||||
Accrued expenses | 55 | 80 | ||||||
Total liabilities | 55 | 80 | ||||||
Net liabilities of discontinued operations | $ | (55 | ) | $ | (80 | ) | ||
BH Holdings, S.A.S [Member] | ' | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | |||||||
Schedule of Discontinued Operations | ' | |||||||
BH Holdings, S.A.S | ||||||||
On January 12, 2012 BHH initiated the filing of an insolvency declaration with the Tribunal de Commerce de Rennes, France ("Commercial Court"). The Commercial Court on January 18, 2012 opened the liquidation proceedings with continuation of BHH's activity for 3 months and named an administrator to manage BHH. Since Drew no longer had a controlling financial interest in BHH it was deconsolidated in the December 31, 2011 quarterly condensed consolidated financial statements and prior period amounts were presented as discontinued operations. | ||||||||
Assets and liabilities of discontinued operations of BHH included in the condensed consolidated balance sheets are summarized as follows at September 30, 2013 and June 30, 2013 (in thousands): | ||||||||
30-Sep | June 30, | |||||||
2013 | 2013 | |||||||
Total assets | $ | — | $ | — | ||||
Liabilities | ||||||||
Accrued lease termination costs | 518 | 493 | ||||||
Total liabilities | 518 | 493 | ||||||
Net liabilities of discontinued operations | $ | (518 | ) | $ | (493 | ) | ||
ECD [Member] | ' | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | |||||||
Schedule of Discontinued Operations | ' | |||||||
On October 3, 2012 the Company sold its Clinical Diagnostics Business to ERBA Diagnostics, Inc. The ECD consisted of Drew Scientific, Inc., and its wholly owned subsidiaries JAS and Drew Scientific Limited Co. The sales price was $6,500,000 in cash and gain on sale of assets was approximately $2,717,000. The following table is in thousands: | ||||||||
3-Oct-12 | ||||||||
Sales Price | $ | 6,500 | ||||||
Broker's fee | (325 | ) | ||||||
Net Proceeds | 6,175 | |||||||
Net Assets Sold | (3,458 | ) | ||||||
Gain on Sale of Assets | $ | 2,717 | ||||||
Net assets sold | ||||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 4 | ||||||
Accounts receivable, net | 1,661 | |||||||
Inventory, net | 1,997 | |||||||
Other current assets | 113 | |||||||
Furniture and equipment, net | 287 | |||||||
Goodwill | 93 | |||||||
Trademarks and trade names, net | 89 | |||||||
Customer list, net | 462 | |||||||
Total Assets | 4,706 | |||||||
Liabilities: | ||||||||
Accounts payable | 639 | |||||||
Accrued expenses | 609 | |||||||
Total liabilities | 1,248 | |||||||
Net assets sold | $ | 3,458 | ||||||
On October 18, 2012, the Company and its debt holder reached an agreement whereby the Company paid the balance of the seller-provided financing plus accrued interest related to the purchase of certain assets of Biocode of $4,367,604 with a one-time payment of $2,487,480 resulting in a gain on extinguishment of debt of $1,880,124. The repayment of the debt has reduced the Company's debt related to Biocode to zero. | ||||||||
The following tables summarize the results of discontinued operations for the three months ended September 30, 2013 and 2012 (in thousands): | ||||||||
For the three-month period ended September 30, | 2013 | 2012 | ||||||
Revenue, net | $ | — | $ | 3,637 | ||||
Cost of goods sold | — | 2,194 | ||||||
Marketing, general and administrative | 26 | 1,176 | ||||||
Research & development | — | 76 | ||||||
Total costs and expenses | 26 | 3,446 | ||||||
Net (loss) income from discontinued operations | $ | (26 | ) | $ | 191 | |||
Assets and liabilities of discontinued operations of ECD included in the condensed consolidated balance sheets are summarized as follows at September 30, 2013 and June 30, 2013 (in thousands): | ||||||||
September 30, | June 30, | |||||||
2013 | 2013 | |||||||
Total Assets | $ | — | $ | — | ||||
Liabilities | ||||||||
Accrued expenses | 55 | 80 | ||||||
Total liabilities | 55 | 80 | ||||||
Net liabilities of discontinued operations | $ | (55 | ) | $ | (80 | ) |
Sigificant_accounting_policies
Sigificant accounting policies Revenue Recognition (Policies) | 3 Months Ended | ||
Sep. 30, 2013 | |||
Revenue Recognition [Abstract] | ' | ||
Revenue Recognition, Policy [Policy Text Block] | ' | ||
Revenue Recognition | |||
The Company recognizes revenue from the sale of its products at the time of shipment, when title and risk of loss transfer. The Company provides products to its distributors at agreed upon wholesale prices and to the balance of its customers at set retail prices. Distributors can receive discounts for accepting high volume shipments. The discounts are reflected immediately in the net invoice price, which is the basis for revenue recognition. No further material discounts are given. | |||
The Company's considerations for recognizing revenue upon shipment of product to a distributor are based on the following: | |||
Persuasive evidence that an arrangement (purchase order and sales invoice) exists between a willing buyer (distributor) and the Company that outlines the terms of the sale (company information, quantity of goods, purchase price and payment terms). The buyer (distributor) does not have a right of return. | |||
Shipping terms are ex-factory shipping point. At this point the buyer (distributor) takes title to the goods and is responsible for all risks and rewards of ownership, including insuring the goods as necessary. | |||
The Company's price to the buyer (distributor) is fixed and determinable as specifically outlined on the sales invoice. The sales arrangement does not have customer cancellation or termination clauses. | |||
The buyer (distributor) places a purchase order with the Company; the terms of the sale are cash, COD or credit. Customer credit is determined based on the Company's policies and procedures related to the buyer's (distributor's) creditworthiness. Based on this determination, the Company believes that collectibility is reasonably assured. | |||
The Company assesses collectibility based on creditworthiness of the customer and past transaction history. The Company performs ongoing credit evaluations of its customers and does not require collateral from its customers. For many of the Company's international customers, the Company requires an irrevocable letter of credit to be issued by the customer before the purchase order is accepted. |
Sigificant_accounting_policies1
Sigificant accounting policies Valuation of Intangible Assets (Policies) | 3 Months Ended |
Sep. 30, 2013 | |
Company overview [Abstract] | ' |
Goodwill and Intangible Assets, Policy [Policy Text Block] | ' |
Valuation of Intangible Assets | |
The Company annually, and as circumstances require, evaluates for impairment its intangible assets and goodwill in accordance with FASB guidance related to goodwill and other intangible assets,” or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. These intangible assets include goodwill, trademarks and trade names. Recoverability of these assets is measured by comparison of their carrying amounts to future discounted cash flows the assets are expected to generate. If identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value. The Company does not amortize intangible assets with indefinite useful lives, rather such assets are required to be tested for impairment at least annually or sooner whenever events or changes in circumstances indicate that the assets may be impaired. The Company performs its intangible asset impairment tests on or about June 30, of each year. Any such impairment charge could be significant and could have a material adverse impact on the Company's financial statements if and when an impairment charge is recorded. |
Sigificant_accounting_policies2
Sigificant accounting policies Income (Loss) Per Share (Policies) | 3 Months Ended |
Sep. 30, 2013 | |
Income (Loss) Per Share [Abstract] | ' |
Earnings Per Share, Policy [Policy Text Block] | ' |
Income/(Loss) Per Share | |
The Company computes net income/(loss) per share under the provisions of FASB issued authoritative guidance. | |
Under the provisions of FASB issued authoritative guidance, basic and diluted net income/(loss) per share is computed by dividing the net income/(loss) for the period by the weighted average number of shares of common stock outstanding during the period. The calculation of diluted net income/(loss) per share excludes potential common shares if the impact is anti-dilutive. Basic earnings per share are computed by dividing net income/(loss) by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share are determined in the same manner as basic earnings per share, except that the number of shares is increased by assuming exercise of dilutive stock options and warrants using the treasury stock method. |
Sigificant_accounting_policies3
Sigificant accounting policies Taxes (Policies) | 3 Months Ended |
Sep. 30, 2013 | |
Taxes [Abstract] | ' |
Income Tax, Policy [Policy Text Block] | ' |
Taxes | |
Estimates of taxable income of the various legal entities and jurisdictions are used in the tax rate calculation. Management uses judgment in estimating what the Company's income tax will be for the year. Since judgment is involved, there is a risk that the tax rate may increase or decrease in any period. | |
In determining income/(loss) for financial statement purposes, management must make certain estimates and judgments. These estimates and judgments occur in the calculation of certain tax liabilities and in the determination of the recoverability of certain deferred tax assets, which arise from temporary differences between the tax and financial statement recognition of revenue and expense. FASB issued authoritative guidance concerning accounting for income taxes also requires that the deferred tax assets be reduced by a valuation allowance if, based on the available evidence, it is more likely than not that all or some portion of the recorded deferred tax assets will not be realized in future periods. | |
In evaluating the Company's ability to recover the Company's deferred tax assets, management considers all available positive and negative evidence including the Company's past operating results, the existence of cumulative losses and near-term forecasts of future taxable income that is consistent with the plans and estimates management is using to manage the underlying businesses. | |
Through September 30, 2013, the Company has recorded a valuation allowance against the Company's deferred tax assets arising from net operating losses due to uncertainty of their realization as a result of the Company's earnings history, the number of years the Company's net operating losses and tax credits can be carried forward, the existence of taxable temporary differences and near-term earnings expectations. The amount of the valuation allowance could decrease if facts and circumstances change that materially increase taxable income prior to the expiration of the loss carryforwards. Any reduction in the valuation allowance would result in an income tax benefit in the period such determination is made by the Company. | |
The Company has adopted FASB issued guidance related to accounting for uncertainty in income taxes, which provides a comprehensive model for the recognition, measurement, and disclosure in financial statements of uncertain income tax positions that a company has taken or expects to take on a tax return. Under the FASB guidance a company can recognize the benefit of an income tax position only if it is more likely than not (greater than 50%) that the tax position will be sustained upon tax examination, based solely on the technical merits of the tax position. Otherwise, no benefit can be recognized. The tax benefits recognized are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Additionally, companies are required to accrue interest and related penalties, if applicable, on all tax exposures for which reserves have been established consistent with jurisdictional tax laws. The Company has elected to recognize interest expense and penalties, if any, related to uncertain tax positions as a component of its provision for income taxes. |
Sigificant_accounting_policies4
Sigificant accounting policies Stock-based Compensation (Policies) | 3 Months Ended |
Sep. 30, 2013 | |
Stock-based Compensation [Abstract] | ' |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | ' |
Stock-Based Compensation | |
Stock-based compensation expense for all stock-based compensation awards granted after July 1, 2006 is based on the grant-date fair value estimate in accordance with the provisions of the FASB issued guidance. The Company recognizes these compensation costs on a straight-line basis over the requisite service period of the award. | |
Valuations are based on highly subjective assumptions about the future, including stock price volatility and exercise patterns. The fair value of share-based payment awards was estimated using the Black-Scholes option pricing model. Expected volatilities are based on the historical volatility of the Company's stock. The Company uses historical data to estimate option exercise and employee terminations. The expected term of options granted represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant. |
Note_3_Earning_per_Share_Table
Note 3. Earning per Share (Tables) | 3 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | ' | ||||||||
The following table sets forth the computation of basic and diluted net income (loss) per share: | |||||||||
Three Months Ended September 30 | |||||||||
2013 | 2012 | ||||||||
Numerator: | |||||||||
Numerator for basic and diluted earnings per share | |||||||||
Income (loss) from continuing operations | $ | 38,846 | $ | (624,396 | ) | ||||
(Loss) income from discontinued operations | (25,605 | ) | 190,960 | ||||||
Net income (loss) | $ | 13,241 | $ | (433,436 | ) | ||||
Denominator: | |||||||||
Denominator for basic earnings per share - weighted average shares | 7,526,430 | 7,526,430 | |||||||
Effect of dilutive securities: | |||||||||
Stock options and warrants | 31,667 | — | |||||||
Shares reserved for future exchange | — | — | |||||||
Denominator for diluted earnings per share - weighted average and assumed conversion | 7,558,097 | 7,526,430 | |||||||
Net income (loss) income per share | |||||||||
Basic: | |||||||||
Continuing operations | $ | — | $ | (0.08 | ) | ||||
Discontinued operations | — | 0.02 | |||||||
$ | — | $ | (0.06 | ) | |||||
Diluted: | |||||||||
Continuing operations | $ | — | $ | (0.08 | ) | ||||
Discontinued operations | — | 0.02 | |||||||
$ | — | $ | (0.06 | ) | |||||
Note_5_Segment_Reporting_Table
Note 5. Segment Reporting (Tables) | 3 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | ' | ||||||||||||||||||||||||
The table below sets forth the income/losses from continuing operations for the three-months ended September 30, 2013 and 2012 (in thousands). | |||||||||||||||||||||||||
Sonomed-Escalon | Corporate | Total | |||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | 2013 | 2012 | ||||||||||||||||||||
Revenues, net: | |||||||||||||||||||||||||
Product revenue | $ | 3,130 | $ | 2,270 | $ | — | $ | — | $ | 3,130 | $ | 2,270 | |||||||||||||
Total revenue, net | 3,130 | 2,270 | — | — | 3,130 | 2,270 | |||||||||||||||||||
Costs and expenses: | |||||||||||||||||||||||||
Cost of goods sold | 1,556 | 1,196 | — | — | 1,556 | 1,196 | |||||||||||||||||||
Marketing, general & admin | 1,138 | 1,304 | 75 | 102 | 1,213 | 1,406 | |||||||||||||||||||
Research & development | 323 | 264 | — | — | 323 | 264 | |||||||||||||||||||
Total costs and expenses | 3,018 | 2,764 | 75 | 102 | 3,092 | 2,866 | |||||||||||||||||||
(Loss) from operations | 112 | (494 | ) | (75 | ) | (102 | ) | 38 | (596 | ) | |||||||||||||||
Other (expense) and income: | |||||||||||||||||||||||||
Interest income | — | — | — | — | — | — | |||||||||||||||||||
Other income | — | — | 1 | 65 | 1 | 65 | |||||||||||||||||||
Interest expense | — | — | — | (93 | ) | — | (93 | ) | |||||||||||||||||
Total other (expense) and income | — | — | 1 | (28 | ) | 1 | (28 | ) | |||||||||||||||||
Income (loss) before taxes | 112 | (494 | ) | (74 | ) | (130 | ) | 39 | (624 | ) | |||||||||||||||
Income taxes (benefits) from continuing operations | — | — | — | — | — | — | |||||||||||||||||||
Net income (loss) from continuing operations | $ | 112 | $ | (494 | ) | $ | (74 | ) | $ | (130 | ) | $ | 39 | $ | (624 | ) | |||||||||
Note_10_Discontinued_Operation1
Note 10. Discontinued Operations (Tables) | 3 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
BH Holdings, S.A.S [Member] | ' | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | |||||||
Schedule of Discontinued Operations | ' | |||||||
BH Holdings, S.A.S | ||||||||
On January 12, 2012 BHH initiated the filing of an insolvency declaration with the Tribunal de Commerce de Rennes, France ("Commercial Court"). The Commercial Court on January 18, 2012 opened the liquidation proceedings with continuation of BHH's activity for 3 months and named an administrator to manage BHH. Since Drew no longer had a controlling financial interest in BHH it was deconsolidated in the December 31, 2011 quarterly condensed consolidated financial statements and prior period amounts were presented as discontinued operations. | ||||||||
Assets and liabilities of discontinued operations of BHH included in the condensed consolidated balance sheets are summarized as follows at September 30, 2013 and June 30, 2013 (in thousands): | ||||||||
30-Sep | June 30, | |||||||
2013 | 2013 | |||||||
Total assets | $ | — | $ | — | ||||
Liabilities | ||||||||
Accrued lease termination costs | 518 | 493 | ||||||
Total liabilities | 518 | 493 | ||||||
Net liabilities of discontinued operations | $ | (518 | ) | $ | (493 | ) | ||
ECD [Member] | ' | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | |||||||
Schedule of Discontinued Operations | ' | |||||||
On October 3, 2012 the Company sold its Clinical Diagnostics Business to ERBA Diagnostics, Inc. The ECD consisted of Drew Scientific, Inc., and its wholly owned subsidiaries JAS and Drew Scientific Limited Co. The sales price was $6,500,000 in cash and gain on sale of assets was approximately $2,717,000. The following table is in thousands: | ||||||||
3-Oct-12 | ||||||||
Sales Price | $ | 6,500 | ||||||
Broker's fee | (325 | ) | ||||||
Net Proceeds | 6,175 | |||||||
Net Assets Sold | (3,458 | ) | ||||||
Gain on Sale of Assets | $ | 2,717 | ||||||
Net assets sold | ||||||||
Assets: | ||||||||
Cash and cash equivalents | $ | 4 | ||||||
Accounts receivable, net | 1,661 | |||||||
Inventory, net | 1,997 | |||||||
Other current assets | 113 | |||||||
Furniture and equipment, net | 287 | |||||||
Goodwill | 93 | |||||||
Trademarks and trade names, net | 89 | |||||||
Customer list, net | 462 | |||||||
Total Assets | 4,706 | |||||||
Liabilities: | ||||||||
Accounts payable | 639 | |||||||
Accrued expenses | 609 | |||||||
Total liabilities | 1,248 | |||||||
Net assets sold | $ | 3,458 | ||||||
On October 18, 2012, the Company and its debt holder reached an agreement whereby the Company paid the balance of the seller-provided financing plus accrued interest related to the purchase of certain assets of Biocode of $4,367,604 with a one-time payment of $2,487,480 resulting in a gain on extinguishment of debt of $1,880,124. The repayment of the debt has reduced the Company's debt related to Biocode to zero. | ||||||||
The following tables summarize the results of discontinued operations for the three months ended September 30, 2013 and 2012 (in thousands): | ||||||||
For the three-month period ended September 30, | 2013 | 2012 | ||||||
Revenue, net | $ | — | $ | 3,637 | ||||
Cost of goods sold | — | 2,194 | ||||||
Marketing, general and administrative | 26 | 1,176 | ||||||
Research & development | — | 76 | ||||||
Total costs and expenses | 26 | 3,446 | ||||||
Net (loss) income from discontinued operations | $ | (26 | ) | $ | 191 | |||
Assets and liabilities of discontinued operations of ECD included in the condensed consolidated balance sheets are summarized as follows at September 30, 2013 and June 30, 2013 (in thousands): | ||||||||
September 30, | June 30, | |||||||
2013 | 2013 | |||||||
Total Assets | $ | — | $ | — | ||||
Liabilities | ||||||||
Accrued expenses | 55 | 80 | ||||||
Total liabilities | 55 | 80 | ||||||
Net liabilities of discontinued operations | $ | (55 | ) | $ | (80 | ) |
Note_1_Basis_of_Presentation_D
Note. 1 Basis of Presentation (Details) (USD $) | 3 Months Ended | 3 Months Ended | ||||
Sep. 30, 2013 | Dec. 31, 2012 | Oct. 18, 2012 | Dec. 31, 2012 | Oct. 03, 2012 | Oct. 03, 2012 | |
segment | ECD [Member] | ECD [Member] | Sales Price Component, Cash at Closing [Member] | |||
ECD [Member] | ||||||
Segment Reporting Information [Line Items] | ' | ' | ' | ' | ' | ' |
Minimum requirement for stock holders' equity | $2,500,000 | ' | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Sales Price, Fixed Component | ' | ' | ' | ' | 6,500,000 | 6,500,000 |
Number of Operating Segments | 2 | ' | ' | ' | ' | ' |
Total BHH debt oustanding, accrued interest included | ' | ' | 4,367,604 | ' | ' | ' |
Repayments of Long-term Debt | ' | 2,487,480 | ' | ' | ' | ' |
Gains (Losses) on Extinguishment of Debt | ' | 1,880,124 | ' | ' | ' | ' |
Deconsolidation, Gain (Loss), Amount | ' | ' | ' | $4,018,772 | ' | ' |
Note_2_StockBased_Compensation1
Note 2. Stock-Based Compensation (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized | $8,629 | $38,271 |
Stock Options [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Allocated Share-based Compensation Expense | $2,157 | $16,485 |
Note_3_Earning_per_Share_Detai
Note 3. Earning per Share (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ' | ' |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $38,846 | ($624,396) |
Income(loss) from discontinued operations | -25,605 | 190,960 |
Net income (loss) | 13,241 | -433,436 |
Weighted Average Number of Shares Outstanding, Basic | 7,526,430 | 7,526,430 |
Proceeds from Stock Options Exercised | $31,667 | $0 |
Shares reserved for future exchange | 0 | 0 |
Weighted Average Number of Shares Outstanding, Diluted | 7,558,097 | 7,526,430 |
Continuing Operations | $0 | ($0.08) |
Discontinued Operations | $0 | $0.02 |
Earnings Per Share, Basic | $0 | ($0.06) |
Continuing Operations | $0 | ($0.08) |
Income (Loss) from Discontinued Operations, Net of Tax, Per Diluted Share | $0 | $0.02 |
Earnings Per Share, Diluted | $0 | ($0.06) |
Note_5_Segment_Reporting_Narra
Note 5. Segment Reporting (Narrative) (Details) | 3 Months Ended |
Sep. 30, 2013 | |
segment | |
Segment Reporting [Abstract] | ' |
Number of Operating Segments | 2 |
Note_5_Segment_Reporting_Segme
Note 5. Segment Reporting (Segments Statements of Operations) (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Segment Reporting Information [Line Items] | ' | ' |
Product revenue | $3,130,083 | $2,269,577 |
Revenues, net | 3,130,083 | 2,269,577 |
Cost of goods sold | 1,556,214 | 1,196,398 |
Marketing, general and administrative | 1,212,962 | 1,405,586 |
Research and development | 323,190 | 264,198 |
Total costs and expenses | 3,092,366 | 2,866,182 |
Loss from operations | 37,717 | -596,605 |
Loss (gain) on sales of assets | 2,717,069 | 2,717,000 |
Equity in OTM | 1,068 | 64,781 |
Interest Expense | 0 | -92,596 |
Total other (expense) income | 1,129 | -27,791 |
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest | 38,846 | -624,396 |
Income taxes benefit from continuing operations | 0 | 0 |
Net (loss) from continuing operations | 38,846 | -624,396 |
Sonomed-Escalon [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Product revenue | 3,130,083 | 2,269,577 |
Revenues, net | 3,130,083 | 2,269,577 |
Cost of goods sold | 1,556,214 | 1,196,398 |
Marketing, general and administrative | 1,138,260 | 1,303,430 |
Research and development | 323,190 | 264,198 |
Total costs and expenses | 3,017,664 | 2,764,026 |
Loss from operations | 112,419 | -494,449 |
Equity in OTM | 0 | 0 |
Interest Expense | 0 | 0 |
Total other (expense) income | 0 | 0 |
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest | 112,419 | -494,449 |
Income taxes benefit from continuing operations | 0 | 0 |
Net (loss) from continuing operations | 112,419 | -494,449 |
Corporate [Member] | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Product revenue | 0 | 0 |
Revenues, net | 0 | 0 |
Cost of goods sold | 0 | 0 |
Marketing, general and administrative | 74,702 | 102,156 |
Research and development | 0 | 0 |
Total costs and expenses | 74,702 | 102,156 |
Loss from operations | -74,702 | -102,156 |
Equity in OTM | 1,068 | 64,781 |
Interest Expense | 0 | -92,596 |
Total other (expense) income | 1,129 | -27,791 |
Income (Loss) from Continuing Operations before Income Taxes, Extraordinary Items, Noncontrolling Interest | -73,573 | -129,947 |
Income taxes benefit from continuing operations | 0 | 0 |
Net (loss) from continuing operations | ($73,573) | ($129,947) |
Note_6_Related_Party_Transacti1
Note 6. Related Party Transactions (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Related Party Transaction [Line Items] | ' | ' |
Equity in OTM | $0 | $1,192 |
Related Party Transaction, Amounts of Transaction | 332,216 | ' |
Total accrued interest, related party | 0 | ' |
Richard J. DePiano [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Advanced amount related party transaction | 300,000 | ' |
Advance amount related party transaction, percentage of receivable | 80.00% | ' |
Monthly interest rate related party transaction | 1.25% | ' |
Accrued interest | 0 | 0 |
Ocular Telehealth Management (OTM) [Member] | Equity Method Investee [Member] | ' | ' |
Related Party Transaction [Line Items] | ' | ' |
Investment held in a company | ' | 444,000 |
Ownership percentage | ' | 45.00% |
Equity in OTM | $0 | $1,192 |
Note_8_Fair_Value_Measurements1
Note 8. Fair Value Measurements (Details) (USD $) | 3 Months Ended | ||
Dec. 31, 2012 | Sep. 30, 2013 | Oct. 18, 2012 | |
Fair Value Disclosures [Abstract] | ' | ' | ' |
Total BHH debt oustanding, accrued interest included | ' | ' | $4,367,604 |
Repayments of Long-term Debt | 2,487,480 | ' | ' |
Gains (Losses) on Extinguishment of Debt | 1,880,124 | ' | ' |
Long-term Debt | ' | ' | ' |
Note_9_Continuing_operations_D
Note. 9 Continuing operations (Details) (USD $) | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Oct. 18, 2012 | Sep. 30, 2013 | Oct. 03, 2012 | |
ECD [Member] | ECD [Member] | |||||
Troubled Debt Restructuring, Debtor, Current Period [Line Items] | ' | ' | ' | ' | ' | ' |
CTA (Cumulative translation adjustments) | ' | ($578,422) | ' | ' | ' | ' |
Minimum requirement for stock holders' equity | ' | ' | 2,500,000 | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Sales Price, Fixed Component | ' | ' | ' | ' | ' | 6,500,000 |
Significant Acquisitions and Disposals, Gain (Loss) on Sale or Disposal, Pretax | ' | ' | ' | ' | 2,717,069 | ' |
Total BHH debt oustanding, accrued interest included | ' | ' | ' | 4,367,604 | ' | ' |
Repayments of Long-term Debt | 2,487,480 | ' | ' | ' | ' | ' |
Gains (Losses) on Extinguishment of Debt | 1,880,124 | ' | ' | ' | ' | ' |
Long-term Debt | ' | ' | ' | ' | ' | ' |
Note_10_Discontinued_Operation2
Note 10. Discontinued Operations (BH Holdings, S.A.S) (Narrative) (Details) (BH Holdings, S.A.S [Member]) | 0 Months Ended |
Jan. 18, 2012 | |
BH Holdings, S.A.S [Member] | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' |
Liquidation period | '3 months |
Note_10_Discontinued_Operation3
Note 10. Discontinued Operations (Results of Discontinued Operations - BH Holdings, S.A.S) (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Income (Loss) before income taxes | ($25,605) | $190,960 |
Income tax expense | 0 | 0 |
Net income | ($25,605) | $190,960 |
Note_10_Discontinued_Operation4
Note 10. Discontinued Operations (Assets and Liabilities of Discontinued Operations - BH Holdings, S.A.S) (Details) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Oct. 03, 2012 |
Assets [Abstract] | ' | ' | ' |
Total assets | $0 | $0 | ' |
Liabilities [Abstract] | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Accrued Liabilities | 55,000 | 80,000 | ' |
Total liabilities | 55,000 | 80,000 | ' |
Net assets of discontinued operations | -55,000 | -80,000 | -3,457,931 |
BH Holdings, S.A.S [Member] | ' | ' | ' |
Assets [Abstract] | ' | ' | ' |
Total assets | 0 | 0 | ' |
Liabilities [Abstract] | ' | ' | ' |
Other current liabilities | 518,000 | 493,000 | ' |
Total liabilities | 518,000 | 493,000 | ' |
Net assets of discontinued operations | ($518,000) | ($493,000) | ' |
Note_10_Discontinued_Operation5
Note 10. Discontinued Operations (Results of Discontinued Operations - ECD) (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Income (Loss) before income taxes | ($25,605) | $190,960 |
ECD [Member] | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Revenue, net | 0 | 3,637,000 |
Cost of goods | 0 | 2,194,000 |
Market, general and administrative | 26,000 | 1,176,000 |
Research and development | 0 | 76,000 |
Total Costs and expenses | 26,000 | 3,446,000 |
Income (loss) from discontinued operations | ($26,000) | $191,000 |
Note_10_Discontinued_Operation6
Note 10. Discontinued Operations Assets and Liabilities of Discontinued Operations -ECD (Details) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Oct. 03, 2012 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' |
Assets | $0 | $0 | ' |
Disposal Group, Including Discontinued Operation, Accrued Liabilities | 55,000 | 80,000 | ' |
Accounts payable | 1,154,665 | 672,926 | ' |
Accrued Liabilities, Current | 910,722 | 1,171,281 | ' |
Liabilities | 55,000 | 80,000 | ' |
Assets of Disposal Group, Including Discontinued Operation, Current | ($55,000) | ($80,000) | ($3,457,931) |
Note_10_Discontinued_Operation7
Note 10. Discontinued Operations Results of discontinued operation -ECD (Details) (USD $) | 3 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax | ($25,605) | $190,960 |
ECD [Member] | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' |
Disposal Group, Including Discontinued Operation, Revenue | 0 | 3,637,000 |
Disposal Group, Including Discontinued Operation, Costs of Goods Sold | 0 | 2,194,000 |
Disposal Group, Including Discontinued Operation, Selling, General and Administrative Expense | 26,000 | 1,176,000 |
Disposal Group, Including Discontinued Operation, Research and Development Expense | 0 | 76,000 |
Disposal Group, Including Discontinued Operation, Operating Expense | 26,000 | 3,446,000 |
Disposal Group, Including Discontinued Operation, Operating Income (Loss) | ($26,000) | $191,000 |
Note_10_Discontinued_Operation8
Note 10. Discontinued Operations Gain on sale (Details) (USD $) | 3 Months Ended | 6 Months Ended | |||||
Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 31, 2012 | Jun. 30, 2013 | Oct. 18, 2012 | Oct. 03, 2012 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Broker's fee | ' | ' | ($325,000) | ' | ' | ' | ' |
Proceeds from Sale of Drew assets | ' | ' | 6,175,000 | ' | ' | ' | ' |
Gain (Loss) on Disposition of Assets | 2,717,069 | ' | 2,717,000 | ' | ' | ' | ' |
Assets of Disposal Group, Including Discontinued Operation | 0 | ' | ' | ' | 0 | ' | ' |
Disposal Group, Including Discontinued Operation, Accrued Liabilities | 55,000 | ' | ' | ' | 80,000 | ' | ' |
Liabilities of Disposal Group, Including Discontinued Operation | 55,000 | ' | ' | ' | 80,000 | ' | ' |
Assets (Liabilities) of Disposal Group, Including Discontinued Operation, Net | -55,000 | ' | ' | ' | -80,000 | ' | -3,457,931 |
Total BHH debt oustanding, accrued interest included | ' | ' | ' | ' | ' | 4,367,604 | ' |
Repayments of Long-term Debt | ' | 2,487,480 | ' | ' | ' | ' | ' |
Gains (Losses) on Extinguishment of Debt | ' | 1,880,124 | ' | ' | ' | ' | ' |
CTA (Cumulative translation adjustments) | ' | ' | ' | 578,422 | ' | ' | ' |
ECD [Member] | ' | ' | ' | ' | ' | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Sales Price, Fixed Component | ' | ' | ' | ' | ' | ' | 6,500,000 |
Significant Acquisitions and Disposals, Gain (Loss) on Sale or Disposal, Pretax | 2,717,069 | ' | ' | ' | ' | ' | ' |
Deconsolidation, Gain (Loss), Amount | ' | 4,018,772 | ' | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Cash and Cash Equivalents | ' | ' | 4,378 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net | ' | ' | 1,660,992 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Inventory | ' | ' | 1,996,775 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Property, Plant, and Equipment, Net | ' | ' | 286,823 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Goodwill | ' | ' | 93,181 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Other Current Assets | ' | ' | 112,980 | ' | ' | ' | ' |
Assets of Disposal Group, Including Discontinued Operation | ' | ' | 4,706,000 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Accounts Payable | ' | ' | 638,541 | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Accrued Liabilities | ' | ' | 609,215 | ' | ' | ' | ' |
Liabilities of Disposal Group, Including Discontinued Operation | ' | ' | 1,248,000 | ' | ' | ' | ' |
Assets (Liabilities) of Disposal Group, Including Discontinued Operation, Net | ' | ' | 3,458,000 | ' | ' | ' | ' |
trade marks and trade names [Member] | ECD [Member] | ' | ' | ' | ' | ' | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Intangible Assets, Net | ' | ' | 89,000 | ' | ' | ' | ' |
Customer Lists [Member] | ECD [Member] | ' | ' | ' | ' | ' | ' | ' |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Disposal Group, Including Discontinued Operation, Intangible Assets, Net | ' | ' | $461,558 | ' | ' | ' | ' |