Biolase reported a net loss of $5.3 million for the first quarter of 2010, compared to a net loss of $4.7 million for the same period last year.
Net revenue for this year's first quarter was $4.4 million, compared to $6.6 million in the same quarter of 2009. Biolase said the decline in revenue resulted from lower sales to Henry Schein, which was reducing its inventories.
"Under the renegotiated distribution agreement with Henry Schein, the majority of its required minimum laser orders for the first quarter were replaced by prepayments for future deliveries of the company's products," according to a Biolase press release. "This new arrangement delayed the recognition of approximately $4 million in revenue from the first quarter to future quarters, while maintaining the expected level of cash flow in the period. The company plans to begin shipping against these prepayments in the second quarter of 2010."
The new purchasing arrangement, signed March 9, 2010 with Henry Schein, provides monthly guaranteed minimum payments and opportunity to expand beyond those minimums, with incremental sales and margin incentives for Biolase to expand into more non-traditional Schein accounts.
During the period, Biolase also announced a significant increase in its direct sales force, introduced a new dental laser, the iLase, and restructured its sales and marketing management team, the company said. It cited positive returns from those efforts in the form of improving end user sales of Waterlase and ezlaze in the first part of the second quarter.
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