Biostem Technologies Inc reports financial results for the quarter ended September 29, 2017.
- Summary numbers: Revenues of USD 0.06 million, Net Earnings of USD -1.59 million.
- Gross margins widened from 61.00% to 67.20% compared to the same period last year, operating (EBITDA) margins now -2,613.78% from -1,017.17%.
- Change in operating cash flow of 0% compared to same period last year is about the same as change in earnings, likely no significant movement in accruals or reserves.
- Earnings rose compared to same period last year, despite decline in operating and pretax margins.
The table below shows the preliminary results and recent trends for key metrics such as revenues and net income growth:
|Relevant Numbers (Quarterly)|
|Revenue Growth (%YOY)||-74.17||34.03||-61.39||-42.01||41.22|
|Earnings Growth (%YOY)||27.17||-470.56||54.15||446.44||-120.28|
|Net Margin (%)||-2880.01||-1421.37||-1048.74||1993.06||-1021.54|
|Return on Equity (%)||-64.26||-76.35||-33.54||81.35||-219.41|
|Return on Assets (%)||-158.99||-212.41||-85.95||154.35||-284.87|
Access our Ratings and Scores for Biostem Technologies Inc
Market Share Versus Profits
Compared to the same period last year, BSEM-US’s change in revenue was close to the amount of its change in earnings. It remains to be seen how the rest of its peer group’s results will turn out and if BSEM-US’s performance is a sign of any major shift in the composition of market share in this sector. Also, for comparison purposes, revenues changed by -72.31% and earnings by 43.89% compared to the previous period.
Earnings Growth Analysis
The company’s earnings growth has been influenced by the year-on-year improvement in gross margins from 61.00% to 67.20%. However the company’s overhead costs have prevented it from fully capitalizing on these gross margin improvements. In fact, the company’s operating margins (EBITDA margins) showed no improvement over the same period last year.
Gross Margin Trend
Companies sometimes sacrifice improvements in revenues and margins in order to extend friendlier terms to customers and vendors. Capital Cube probes for such activity by comparing the changes in gross margins with any changes in working capital. If the gross margins improved without a worsening of working capital, it is possible that the company’s performance is a result of truly delivering in the marketplace and not simply an accounting prop-up using the balance sheet.
BSEM-US’s gross margin improvement has not produced any big difference in its working capital. Working capital days are currently -238.64, compared to last year’s level of -774.19 days. This leads Capital Cube to conclude that the improvements in gross margins are likely from operating decisions and not trade-offs with the balance sheet.
Cash Versus Earnings – Sustainable Performance?
It is important to examine a company’s cash versus earnings numbers to gauge whether its performance is sustainable.
BSEM-US’s year-on-year change in operating cash flow of 0% is around its change in earnings. This suggests that there are likely no significant movement in accruals or reserves for managing earnings this period.
Despite a decline in operating (EBIT) margins as well as a decline in pretax margins, the company’s earnings rose.
Access our Ratings and Scores for Biostem Technologies Inc
Biostem Technologies, Inc. is a development-stage company. The Company is a biotechnology company focused on the development of anti-aging nutraceutical and cosmeceutical products, stem cell therapies, pharmaceuticals and educational provider of cell treatment protocols. The Company’s divisions include Biostem Cell Therapy, Biostem Pharmaceuticals and Biostem Wellness. Biostem Cell Therapy provides stem cell therapies, stem cell banking, stem cell therapy, and stem cell research and development. Biostem Pharmaceuticals provides research and product development, active pharmaceutical ingredient (API) re-packaging and lab services. Biostem Wellness provides anti-aging and rejuvenation products and services, wellness and management programs, among others. The Company’s subsidiaries include Biostem Wellness, Inc., Biostem Pharmaceuticals, Inc., Biostem Cell Therapy, Inc., Biostem International Inc. and Biostem Helps, Inc.
CapitalCube is a financial portal providing comprehensive company analysis including on-demand fundamental research, portfolio evaluation and screening tools on over 50,000 global equities and North American ETFs. CapitalCube and its affiliated companies own no shares in the companies mentioned in this report. CapitalCube is owned by AnalytixInsight Inc. Visit www.capitalcube.com for a free trial.
CapitalCube does not own any shares in the stocks mentioned and focuses solely on providing unique fundamental research and analysis on approximately 50,000 stocks and ETFs globally. Try any of our analysis, screener or portfolio premium services free for 7 days. To get a quick preview of our services, check out our free quick summary analysis of BSEM-US.
The information presented in this report has been obtained from sources deemed to be reliable, but AnalytixInsight does not make any representation about the accuracy, completeness, or timeliness of this information. This report was produced by AnalytixInsight for informational purposes only and nothing contained herein should be construed as an offer to buy or sell or as a solicitation of an offer to buy or sell any security or derivative instrument. This report is current only as of the date that it was published and the opinions, estimates, ratings and other information may change without notice or publication. Past performance is no guarantee of future results. Prior to making an investment or other financial decision, please consult with your financial, legal and tax advisors. AnalytixInsight shall not be liable for any party’s use of this report. AnalytixInsight is not a broker-dealer and does not buy, sell, maintain a position, or make a market in any security referred to herein. One of the principal tenets for us at AnalytixInsight is that the best person to handle your finances is you. By your use of our services or by reading any of our reports, you’re agreeing that you bear responsibility for your own investment research and investment decisions. You also agree that AnalytixInsight, its directors, its employees, and its agents will not be liable for any investment decision made or action taken by you and others based on news, information, opinion, or any other material generated by us and/or published through our services. For a complete copy of our disclaimer, please visit our website www.analytixinsight.com.