Medis Technologies Ltd. reported financial results for the second quarter and six-months ended June 30, 2008. For the quarter ended June 30, 2008, the net loss attributable to common stockholders was $16,666,000, or $.44 per share, based on a weighted average number of common shares of 37,707,938, compared to a net loss attributable to common stockholders of $9,783,000, or $.29 per share, based on a weighted average number of common shares of 33,448,397, for the quarter ended June 30, 2007.
For the six-months ended June 30, 2008, the net loss attributable to common stockholders was $31,455,000, or $.86 per share, based on a weighted average number of common shares of 36,632,074, compared to a net loss attributable to common stockholders of $19,118,000, or $.57 per share, based on a weighted average number of common shares of 33,441,443, for the six-months ended June 30, 2007. Costs during the quarter and six-months ended June 30, 2008 were impacted by depreciation and other production facility costs of approximately $6,617,000 and $8,983,000, respectively, which include depreciation, labor and other production facility costs and materials.
According to the company, the results for the quarter and six months ended June 30, 2008 were also impacted by a general weakness of the U.S. dollar in relationship to other currencies in which some of the company’s costs are denominated. Furthermore, all periods presented were impacted by non-cash expenses related to the issuance of stock options and restricted stock of approximately $1,821,000 and $3,420,000 for the quarter and six-months ended June 30, 2008, respectively, compared to $1,693,000 and $3,350,000 for the quarter and six months ended June 30, 2007, respectively. Also impacting all periods presented were dividends declared and paid on the company’s Series A cumulative convertible perpetual preferred stock of approximately $1,042,000 a quarter.
Commenting on the report, Robert K. Lifton, Chairman & CEO of Medis Technologies, stated, "As we have been preparing to broaden the launch of our products, during this past quarter we continued to incur costs related to our high volume production facilities and to increase our inventories, as well as devoting resources to our research and development activities. We consider ourselves fortunate during these very difficult and uncertain times in the financial world to have completed an equity raise totaling $29 million. At the end of the quarter, these funds, together with funds on hand left us with $37.6 million in cash, cash equivalents and short-term investment assets and $5.76 million of restricted cash and deposits, as well as an inventory, consisting mostly of raw materials and product components, of $12.99 million. We are taking cost reduction measures to help stretch those funds for use during what we expect will be a successful sales program."
"As we announced, our 24/7 Power Pack Starter Kit with the basic Power Management system will be offered in a limited number of Best Buy and Best Buy Mobile stores starting this month. We also expect the basic 24/7 Power Pack to soon become available to customers in other stores and through other sources. For example, we are shipping Medis 24/7 Power Pack Starter Kits to outlets in South America which we expect to start appearing on a limited number of retail shelves there." Lifton concluded.
