Medical devices company Biosensors International on Wednesday posted a net loss of US$247.04 million for the fourth-quarter ended March 31, 2015, reversing a profit of US$6.11 million a year ago.
This translates to loss per share of 14.76 US cents for the quarter, compared with 0.36 US cent in Q4 FY2014.
The reported net loss for Q4 FY2015 was the result of several exceptional items recorded in the quarter, which includes a US$256.1 million one-time non-cash goodwill write-off mainly related to the China business.
"This goodwill was written off as China's annual drug-eluting stents revenue growth rates - which were in high double-digit percentages when Biosensors bought the remaining 50 per cent equity in JW Medical Systems (JWMS) - has since declined over the last few years. While management remains optimistic on the underlying demand in China's healthcare industry, the impairment reflects the lower growth rate that the China operation has recorded in recent quarters," said the company.
Total revenue slid 7 per cent year-on-year to US$75.93 million for the quarter, dragged by lower licensing and royalty revenue and unfavourable foreign exchange impact.
Total cost of sales edged up 7 per cent in Q4 to US$20.71 million.
Profit from operations dropped 9 per cent to US$16.47 million.
For its fiscal year 2016, the company said it expects market competition and pricing pressure to stay as headwinds.
"In addition, licensing income from partner, Terumo, could continue to decrease. The currency environment is also expected to remain challenging as the company has concentrated risk with a majority of its revenue coming from non-US dollar denominated regions. Despite these issues, management aims to continue to work towards revenue growth over FY2015. This is expected to be largely driven by revenue growth from BioFreedom and Cardiac Diagnostic segment as well as further expansion in Japan and emerging markets."
Jose Calle, Biosensors' CEO, said lower licensing revenue and unfavourable foreign exchange rates impacted on sales.
"Looking at the revenue, the cardiac diagnostic division and our distribution business in Japan were the best performers during Q4 FY2015. We were also particularly pleased with the improvement in our operating income net of licensing and royalty revenue, which reflects the progress we have made in optimising our cost structure."
Over the longer term, Mr Calle said the firm will continue to strengthen its competitive position and further penetrate cardiovascular markets worldwide.