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QT's Q3 balance sheet, bottom line in hole after providing for loss of lawsuit
QT Vascular fell into negative equity and posted a ballooned net loss of US$33.3 million in the third quarter as the company fully provided for damages that it may have to pay after it lost a lawsuit.
The maker of balloon catheters said net loss was four US cents per share for the three months ended September. In Q3 2014, net loss was US$3.7 million, or 0.5 US cent per share.
The company recorded US$21.3 million of other expenses, of which US$20.4 million came from damages that a California judge in July awarded to AngioScore against QT chief executive Eitan Konstantino and his companies, including QT, Quattro Vascular and TriReme Medical. QT has said that it plans to appeal the ruling.
The company's balance sheet reflected a net liability position of US$13.7 million, or a hole of two US cents per share, although from a cash perspective the company is not expected to have to pay the full damages from the lawsuit, if at all, until the legal process is played out.
QT shares closed at 16.1 Singapore cents on Monday, lower by 1.8 per cent or 0.3 Singapore cent, before the results were announced.
Revenue during the quarter fell 26.7 per cent to US$2.5 million, although gross profit rose 60.8 per cent to US$1.1 million.
QT said the growing adoption of drug-coated balloons in the United States has led to a flattening of shipments of other treatments, including conventional balloons. Approval to sell QT's Chocolate PTA balloon catheter in Japan could also be delayed to the first half of 2016 from late 2015, the company added.