Clinicor Reports Q1 Results and 115% Increase In Backlog Since Year-End; Outlines Capital Requirements and Strategic Acquisition Opportunities.Business Editors AUSTIN Austin. 1 City (1990 pop. 21,907), seat of Mower co., SE Minn., on the Cedar River, near the Iowa line; inc. 1868. The commercial and industrial center of a rich farm region, it is noted as home to the Hormel meatpacking company, whose Spam Town museum , Texas--(BUSINESS WIRE)--May 23, 2000 Clinicor, Inc. (OTC OTC See: Over-the-counter. OTC See over-the-counter market (OTC). BB:CLCR), an innovative provider of clinical research services to the pharmaceutical, biotechnology and medical device industries, today announced operating results and contract backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. for the first quarter ended March 31, 2000. For the three months ended March 31, 2000, Clinicor's net service revenues were $1,407,865 as compared to $1,613,181 in the 1999 period. The reduction in net service revenue in the 2000 first quarter is primarily attributable to certain contract cancellations that occurred in the third quarter of 1999 and due to a decrease in average net service revenue generated by current contracts. The contract cancellations, which occurred primarily due to a lack of efficacy of the sponsor's product, reduced backlog by approximately $1.7 million and budgeted Q1 2000 quarterly net service revenue by $750,000. Combined operating costs operating costs npl → gastos mpl operacionales during the 2000 first quarter were held unchanged from the year-earlier period. The Company's net loss increased to $698,022, compared to a net loss of $452,114 in the year-ago first quarter, primarily due to the decline in net service revenue. Clinicor's first quarter net loss applicable to common stock, after preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. dividends and conversion discount, increased 37% to $940,609, or $0.23 per share, compared to $687,188, or $0.16 per share, in the 1999 first quarter. Clinicor's net service revenue backlog increased to $6.2 million at March 31, 2000 from $4.0 million at December December: see month. 31, 1999. As of April 30, 2000, the net service revenue backlog had increased to approximately $8.6 million, an increase of 115% from year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . The new contracts awarded so far in 2000 are, on average, longer in duration than contacts the Company has experienced in the past. While the backlog growth trend bodes well for the future, it is expected to result in less earned net service revenue in the early stages of contract performance in 2000. Accordingly, Clinicor estimates that the effect of this trend will mean that approximately $3 million in net service revenue internally budgeted to be earned in 2000 will shift to 2001. Primarily as a result of this trend, the Company believes that its existing capital resources and internal cash flow will not be sufficient to fund operations through the balance of 2000. Accordingly, the Company is seeking additional capital through a private placement of equity securities and is evaluating other strategic alternatives. Proposed Consolidation/Acquisition Strategy: Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. Sammis, Clinicor's president, commented: "The drug development industry fundamentals are strong and the pipeline of new drugs going to clinical trials has never been stronger. The approximately $5 billion in contracts annually outsourced to CROs continues to grow by 15% to 20% annually. However, consolidation in the pharmaceutical industry and a recent trend of contract cancellations and project delays, have adversely affected many smaller, privately held participants in the CRO industry. We believe this creates an ideal environment for Clinicor to leverage its publicly-traded status as a consolidator within the estimated 600 smaller, privately held CROs worldwide. "In addition to evaluating other strategic alternatives, Clinicor is seeking to complete a private placement of equity securities for acquisitions as well as working capital needs. Clinicor estimates that with additional capital, it can acquire, on favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. and accretive terms, companies that have substantial annual net service revenues. Further, we believe Clinicor could be an ideal consolidator given the investments we have made in a state of the art Oracle applications platform, our Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the clinical trial management information application, CorDat@(R), and our team of experienced industry management. Intended benefits of the acquisition strategy are to improve the Company's financial leverage while also adding complementary services, therapeutic experience and geographic presence in both the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). . In addition, acquisitions should result in
faster overall revenue growth than can be obtained internally, and
should allow Clinicor to better leverage its selling, general and
administrative expense through higher contract throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. , thereby allowing the Company to achieve sustained operating profitability. Clinicor is aggressively pursing this natural growth opportunity and has identified and conducted initial due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. with several acquisition targets. The Company is now focusing on discussions with potential financing sources in order to fund its acquisition plan. There can be no assurance that we will be able to reach agreements with acquisition candidates or successfully finance acquisitions." Revision to Form 10-KSB: Based upon recent updated guidance by the Securities and Exchange Commission to the national accounting firms relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc preferred stock issues that contain certain change in control redemption provisions, Clinicor's outside auditors AUDITORS, practice. Persons lawfully appointed to examine and digest accounts referred to them, take down the evidence in writing, which may be lawfully offered in relation to such accounts, and prepare materials on which a decree or judgment may be made; and to report the whole, together advised the Company to revise its balance sheet classification of the Company's Series A and B preferred stock. Accordingly, Clinicor has revised its December 31, 1999 and 1998 balance sheets to present $9,603,000 and $9,253,000, respectively, of convertible preferred stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". subject to redemption as mezzanine capital Mezzanine capital (or mezzanine debt) is a broad financial term that refers to unsecured, high-yield, subordinated debt or preferred stock that represents a claim on a company's assets that is senior only to that of a company's shareholders. outside of shareholder's equity. The revision is reflected in the balance sheet for March 31, 2000 and for periods thereafter. The revision did not change the Company's income statements for the respective periods. Clinicor, Inc., an Austin, Texas-based contract research organization (CRO), provides product development services including Phase I - IV clinical trials management, patient recruitment, monitoring, data management services and regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. consultation to the pharmaceutical, biotechnology and medical device industries. Clinicor differentiates itself through a unique operating model Operating Model is a term that is used in many contexts. In essence an operating model describes how an organization operates across both business and technology domains. The Operating Model describes what is important for the organization. that emphasizes its specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. patient recruitment, patient management and study monitoring capabilities. Management believes that Clinicor's approach accelerates the recruitment of patient populations and enhances the accuracy of clinical data, resulting in high caliber clinical trial services offering significant value to sponsors. Certain statements in this press release are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. such as its proposed capital raising and acquisition strategy. A variety of factors could cause the Company's actual results and experience to differ materially from the results anticipated by management. Among the risks and uncertainties that could affect the Company's operations and performance are matters affecting the timing of clinical trials being conducted by the Company, including possible decisions by sponsors to suspend or alter the timing or scope of clinical trials, risks related to the management and financing of growth, and other risks. Detailed information concerning factors that could cause actual results to differ materially from management's expectations is available in the "Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial " portion of the Company's report on Form 10-KSB for the year ended December 31, 1999.
CLINICOR, INC.
Summary Statements of Operations
(in thousands, except per share data)
(Unaudited)
Three Months Ended
March 31,
1999 2000
---- ----
Service revenue:
Gross service revenue $ 3,190 $ 1,822
Reimbursable costs 1,577 414
-------- --------
Net service revenue 1,613 1,408
Operating costs and expenses:
Direct costs 1,082 1,112
Selling, general and administrative 872 855
Depreciation and amortization 101 94
-------- -------
Total operating costs and expenses 2,055 2,061
------- -----
Loss from operations (441) (653)
Other income and expenses:
Interest income 30 11
Interest expense (40) (56)
----------- ---------
Other income and expenses (11) (45)
----------- ---------
Net loss $ (452) $ (698)
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Dividends on convertible preferred stock
Subject to redemption (235) (243)
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Net loss applicable to common stock $ (687) $ (941)
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Net loss applicable to common stock
per share:
Basic/Diluted $ (0.16) $ (0.23)
========== ==========
Weighted average number of common shares
Basic/Diluted 4,170 4,170
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