AxoGen, Inc. (OTCBB: AXGN), a leading regenerative medicine company dedicated to advancing the science and commercialization of peripheral nerve repair solutions, today announced revenues for the third quarter ended September 30, 2012 of $1.98 million, a 74% increase over revenues of $1.14 million in the third quarter 2011.
“Compared to last year, we delivered solid top-line growth during the quarter despite cash constraints and the distraction of raising capital,” commented Karen Zaderej, Chief Executive Officer of AxoGen. “In addition, to remain in compliance with covenants imposed by our former lender, we carefully managed cash and chose to defer certain sales force growth and marketing activities.”
Ms. Zaderej continued, “As a result of the recent financing with PDL, we paid off all bank debt and eliminated the restrictive lender requirements. This will allow us the flexibility to develop and expand our sales force and invest in significant marketing efforts.”
Revenues for the period were $1.98 million, a 74% increase, compared to $1.14 million for the same period in 2011. These results were due to expansion of sales and marketing efforts versus third quarter 2011 and focused on the development of new accounts as well as penetration into key accounts.
Revenues decreased 1.5% compared to second quarter 2012 revenues of $2.01 million. This is the second year in which the third quarter has been relatively flat compared to the second quarter. While this may suggest seasonality in peripheral nerve surgery, it is important to note that in both of these quarters there were material corporate transactions that may have distracted operations. In addition, during the period, the Company made personnel changes in certain sales territories, but did not increase the size of its direct sales force.
Gross profit for the period increased to $1.44 million from the reported third quarter 2011 results of $10,000. The favorable results reflect increased revenues and lower manufacturing cost in 2012 and exclude an inventory write-off of $0.83, which occurred during the third quarter 2011.