|
|
|
|
|
|
ý
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the quarterly period ended September 30, 2017
|
|
or
|
|
o
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from _____ to _____
|
Commission File Number: 0-12183
|
|
BOVIE MEDICAL CORPORATION
|
(Exact name of registrant as specified in its charter)
|
Delaware
|
|
11-2644611
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
|
|
|
|
|
|
|
Page
|
Part I.
|
|
|
||
|
|
|
|
|
Item 1.
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
||
|
|
|
|
|
Item 2.
|
|
|
||
Item 3.
|
|
|
||
Item 4.
|
|
|
||
|
|
|
|
|
Part II.
|
|
|
||
|
|
|
|
|
Item 1.
|
|
|
||
Item 1A.
|
|
|
||
Item 2.
|
|
|
||
Item 3.
|
|
|
||
Item 4.
|
|
|
||
Item 5.
|
|
|
||
Item 6.
|
|
|
||
|
|
|
|
September 30,
2017 |
|
December 31,
2016 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
9,411
|
|
|
$
|
14,456
|
|
Restricted cash
|
779
|
|
|
779
|
|
||
Trade accounts receivable, net of allowance of $154 and $118
|
4,077
|
|
|
4,733
|
|
||
Inventories, net
|
7,335
|
|
|
6,158
|
|
||
Prepaid expenses and other current assets
|
634
|
|
|
413
|
|
||
Total current assets
|
22,236
|
|
|
26,539
|
|
||
Property and equipment, net
|
6,376
|
|
|
6,449
|
|
||
Brand name and trademark
|
1,510
|
|
|
1,510
|
|
||
Purchased technology and license rights, net
|
189
|
|
|
215
|
|
||
Goodwill
|
185
|
|
|
185
|
|
||
Deposits
|
84
|
|
|
109
|
|
||
Other assets
|
119
|
|
|
103
|
|
||
Total assets
|
$
|
30,699
|
|
|
$
|
35,110
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
1,387
|
|
|
$
|
1,606
|
|
Accrued payroll
|
193
|
|
|
419
|
|
||
Accrued vacation
|
330
|
|
|
404
|
|
||
Current portion of mortgage note payable
|
239
|
|
|
239
|
|
||
Accrued and other liabilities
|
2,657
|
|
|
2,604
|
|
||
Total current liabilities
|
4,806
|
|
|
5,272
|
|
||
Mortgage note payable, net of current portion
|
2,515
|
|
|
2,694
|
|
||
Note payable
|
140
|
|
|
140
|
|
||
Deferred rents
|
11
|
|
|
14
|
|
||
Deferred tax liability
|
564
|
|
|
564
|
|
||
Derivative liabilities
|
146
|
|
|
203
|
|
||
Total liabilities
|
8,182
|
|
|
8,887
|
|
||
STOCKHOLDERS' EQUITY
|
|
|
|
||||
Series B convertible preferred stock, $0.001 par value; 3,588,139 authorized and zero issued and outstanding as of September 30, 2017 and 3,588,139 authorized and 975,639 issued and outstanding as of December 31, 2016, respectively
|
—
|
|
|
1
|
|
||
Common stock, $0.001 par value; 75,000,000 shares authorized; 32,975,174 issued and 32,832,095 outstanding as of September 30, 2017 and 40,000,000 shares authorized; 31,002,832 issued and 30,859,753 outstanding as of December 31, 2016, respectively
|
33
|
|
|
31
|
|
||
Additional paid-in capital
|
50,156
|
|
|
49,625
|
|
||
Accumulated deficit
|
(27,672
|
)
|
|
(23,434
|
)
|
||
Total stockholders' equity
|
22,517
|
|
|
26,223
|
|
||
Total liabilities and stockholders' equity
|
$
|
30,699
|
|
|
$
|
35,110
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Sales
|
$
|
9,347
|
|
|
$
|
10,063
|
|
|
$
|
27,535
|
|
|
$
|
27,133
|
|
Cost of sales
|
4,753
|
|
|
5,002
|
|
|
13,673
|
|
|
14,049
|
|
||||
Gross profit
|
4,594
|
|
|
5,061
|
|
|
13,862
|
|
|
13,084
|
|
||||
Other costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Research and development
|
610
|
|
|
681
|
|
|
2,015
|
|
|
1,941
|
|
||||
Professional services
|
421
|
|
|
292
|
|
|
1,291
|
|
|
1,045
|
|
||||
Salaries and related costs
|
2,080
|
|
|
2,192
|
|
|
6,783
|
|
|
6,492
|
|
||||
Selling, general and administrative
|
2,617
|
|
|
2,141
|
|
|
7,950
|
|
|
6,354
|
|
||||
Total other costs and expenses
|
5,728
|
|
|
5,306
|
|
|
18,039
|
|
|
15,832
|
|
||||
Loss from operations
|
(1,134
|
)
|
|
(245
|
)
|
|
(4,177
|
)
|
|
(2,748
|
)
|
||||
Interest expense, net
|
(36
|
)
|
|
(37
|
)
|
|
(103
|
)
|
|
(125
|
)
|
||||
Change in fair value of derivative liabilities
|
(69
|
)
|
|
(683
|
)
|
|
57
|
|
|
(555
|
)
|
||||
Total other loss, net
|
(105
|
)
|
|
(720
|
)
|
|
(46
|
)
|
|
(680
|
)
|
||||
Loss before income taxes
|
(1,239
|
)
|
|
(965
|
)
|
|
(4,223
|
)
|
|
(3,428
|
)
|
||||
Income tax expense
|
6
|
|
|
—
|
|
|
15
|
|
|
—
|
|
||||
Net loss
|
$
|
(1,245
|
)
|
|
$
|
(965
|
)
|
|
$
|
(4,238
|
)
|
|
$
|
(3,428
|
)
|
|
|
|
|
|
|
|
|
||||||||
Loss per share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.13
|
)
|
Diluted
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.13
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of shares outstanding - basic
|
31,078
|
|
|
27,075
|
|
|
30,932
|
|
|
27,059
|
|
||||
Weighted average number of shares outstanding - dilutive
|
31,078
|
|
|
27,075
|
|
|
30,932
|
|
|
27,059
|
|
|
Preferred Stock
|
|
Common Stock
|
|
|
|
|
|
|
||||||||||||||||
|
Shares
|
|
Par Value
|
|
Shares
|
|
Par Value
|
|
Additional Paid-In Capital
|
|
Accumulated Deficit
|
|
Total
|
||||||||||||
Balance
December 31, 2015 |
1,976
|
|
|
$
|
2
|
|
|
27,051
|
|
|
$
|
27
|
|
|
$
|
42,859
|
|
|
$
|
(19,484
|
)
|
|
$
|
23,404
|
|
Options exercised
|
—
|
|
|
—
|
|
|
31
|
|
|
—
|
|
|
119
|
|
|
—
|
|
|
119
|
|
|||||
Warrants exercised
|
—
|
|
|
—
|
|
|
133
|
|
|
—
|
|
|
316
|
|
|
—
|
|
|
316
|
|
|||||
Stock based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
533
|
|
|
—
|
|
|
533
|
|
|||||
Stock swap to acquire options and warrants
|
—
|
|
|
—
|
|
|
(73
|
)
|
|
—
|
|
|
(315
|
)
|
|
—
|
|
|
(315
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,428
|
)
|
|
(3,428
|
)
|
|||||
Balance
September 30, 2016 |
1,976
|
|
|
$
|
2
|
|
|
27,142
|
|
|
$
|
27
|
|
|
$
|
43,512
|
|
|
$
|
(22,912
|
)
|
|
$
|
20,629
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance
December 31, 2016 |
976
|
|
|
$
|
1
|
|
|
30,860
|
|
|
$
|
31
|
|
|
$
|
49,625
|
|
|
$
|
(23,434
|
)
|
|
$
|
26,223
|
|
Options exercised
|
—
|
|
|
—
|
|
|
21
|
|
|
—
|
|
|
275
|
|
|
—
|
|
|
275
|
|
|||||
Conversion of Series B convertible preferred to common stock
|
(976
|
)
|
|
(1
|
)
|
|
1,951
|
|
|
2
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||||
Stock based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
532
|
|
|
—
|
|
|
532
|
|
|||||
Stock swap to acquire options and warrants
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(275
|
)
|
|
—
|
|
|
(275
|
)
|
|||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,238
|
)
|
|
(4,238
|
)
|
|||||
Balance
September 30, 2017 |
—
|
|
|
$
|
—
|
|
|
32,832
|
|
|
$
|
33
|
|
|
$
|
50,156
|
|
|
$
|
(27,672
|
)
|
|
$
|
22,517
|
|
|
Nine Months Ended September 30,
|
||||||
|
2017
|
|
2016
|
||||
Cash flows from operating activities
|
|
|
|
||||
Net loss
|
$
|
(4,238
|
)
|
|
$
|
(3,428
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation and amortization
|
527
|
|
|
556
|
|
||
Provision for inventory obsolescence
|
203
|
|
|
365
|
|
||
Gain on disposal of property and equipment, net
|
3
|
|
|
19
|
|
||
Stock based compensation
|
532
|
|
|
533
|
|
||
Change in fair value of derivative liabilities
|
(57
|
)
|
|
555
|
|
||
Provision for allowance for doubtful accounts
|
128
|
|
|
126
|
|
||
Provision for deferred taxes
|
—
|
|
|
25
|
|
||
Changes in current assets and liabilities:
|
|
|
|
||||
Trade receivables
|
528
|
|
|
(1,070
|
)
|
||
Prepaid expenses
|
(221
|
)
|
|
(48
|
)
|
||
Inventories
|
(1,380
|
)
|
|
(337
|
)
|
||
Deposits and other assets
|
9
|
|
|
312
|
|
||
Accounts payable
|
(219
|
)
|
|
436
|
|
||
Accrued and other liabilities
|
(250
|
)
|
|
(337
|
)
|
||
Net cash used in operating activities
|
(4,435
|
)
|
|
(2,293
|
)
|
||
Cash flows from investing activities
|
|
|
|
||||
Purchases of technology, property and equipment
|
(431
|
)
|
|
(182
|
)
|
||
Net cash used in investing activities
|
(431
|
)
|
|
(182
|
)
|
||
Cash flows from financing activities
|
|
|
|
||||
Proceeds from stock options/warrants exercised
|
—
|
|
|
119
|
|
||
Change in restricted cash
|
—
|
|
|
60
|
|
||
Repayment of mortgage note payable
|
(179
|
)
|
|
(180
|
)
|
||
Net cash used in financing activities
|
(179
|
)
|
|
(1
|
)
|
||
Net change in cash and cash equivalents
|
(5,045
|
)
|
|
(2,476
|
)
|
||
Cash and cash equivalents, beginning of period
|
14,456
|
|
|
11,805
|
|
||
Cash and cash equivalents, end of period
|
$
|
9,411
|
|
|
$
|
9,329
|
|
|
|
|
|
||||
Cash paid for:
|
|
|
|
||||
Interest paid
|
$
|
103
|
|
|
$
|
125
|
|
(In thousands)
|
September 30,
2017 |
|
December 31,
2016 |
||||
Raw materials
|
$
|
5,145
|
|
|
$
|
4,521
|
|
Finished goods
|
3,804
|
|
|
3,048
|
|
||
Gross inventories
|
8,949
|
|
|
7,569
|
|
||
Less: reserve for obsolescence
|
(1,614
|
)
|
|
(1,411
|
)
|
||
Net inventories
|
$
|
7,335
|
|
|
$
|
6,158
|
|
(In thousands)
|
September 30,
2017 |
|
December 31,
2016 |
||||
Brand name and trademark (life indefinite)
|
$
|
1,510
|
|
|
$
|
1,510
|
|
|
|
|
|
||||
Purchased technology (5-17 year lives)
|
$
|
1,496
|
|
|
$
|
1,441
|
|
Less: accumulated amortization
|
(1,307
|
)
|
|
(1,226
|
)
|
||
Purchased technology, net
|
$
|
189
|
|
|
$
|
215
|
|
|
|
|
|
||||
Goodwill
|
$
|
185
|
|
|
$
|
185
|
|
(in thousands)
|
2013
Placement Agent Warrants
|
||
Balance, December 31, 2016
|
$
|
203
|
|
Change in fair value
|
(57
|
)
|
|
Balance, September 30, 2017
(1)
|
$
|
146
|
|
(1)
|
The warrants are valued using a trinomial lattice valuation methodology because that model embodies all of the relevant assumptions that address the features underlying these instruments. Significant assumptions used in the model at
September 30, 2017
included the market price of our common stock, an expected dividend yield of
zero
, the remaining period to the expiration date of the warrants, expected volatility of our common stock over the remaining life of the warrants of
2.0 years
, estimated based on a review of our historical volatility of
60.290%
and risk-free rates of return of
1.380%
for the 2013 warrants based on constant maturity rates published by the U.S. Federal Reserve, applicable to the remaining life of the warrants. We also take into consideration a probability assumption for anti-dilution.
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(in thousands, except per share data)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net loss available to common shareholders
|
$
|
(1,245
|
)
|
|
$
|
(965
|
)
|
|
$
|
(4,238
|
)
|
|
$
|
(3,428
|
)
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Derivative liability - warrants
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Numerator for dilutive loss per common share
|
$
|
(1,245
|
)
|
|
$
|
(965
|
)
|
|
$
|
(4,238
|
)
|
|
$
|
(3,428
|
)
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average shares used to compute basic loss per common share
|
31,078
|
|
|
27,075
|
|
|
30,932
|
|
|
27,059
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||||
Derivative liability - warrants
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Denominator for dilutive loss per common share
|
31,078
|
|
|
27,075
|
|
|
30,932
|
|
|
27,059
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic loss per common share
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.13
|
)
|
Diluted loss per common share
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.14
|
)
|
|
$
|
(0.13
|
)
|
|
Number of options
|
|
Weighted average exercise price
|
|||
Outstanding at December 31, 2016
|
3,752,209
|
|
|
$
|
3.04
|
|
Granted
|
628,000
|
|
|
3.26
|
|
|
Exercised
|
(104,500
|
)
|
|
2.64
|
|
|
Canceled and forfeited
|
(196,803
|
)
|
|
4.99
|
|
|
Outstanding at September 30, 2017
|
4,078,906
|
|
|
$
|
2.99
|
|
|
2017 Grants
|
||||||
Option value
|
$
|
1.73
|
|
-
|
$
|
2.34
|
|
Risk-free rate
|
1.5%
|
||||||
Expected dividend yield
|
—%
|
||||||
Expected volatility
|
68.0%
|
||||||
Expected term (in years)
|
6
|
(In thousands)
|
Long-term debt
|
||
2017
(remaining three months)
|
$
|
60
|
|
2018
|
239
|
|
|
2019
|
2,455
|
|
|
Total
|
$
|
2,754
|
|
|
Three Months Ended September 30, 2017
|
||||||||||||||||||
(In thousands)
|
Core
|
|
OEM
|
|
Advanced Energy
|
|
Corporate (Other)
|
|
Total
|
||||||||||
Sales
|
$
|
6,696
|
|
|
$
|
525
|
|
|
$
|
2,126
|
|
|
$
|
—
|
|
|
$
|
9,347
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from operations
(1)
|
1,699
|
|
|
323
|
|
|
(718
|
)
|
|
(2,438
|
)
|
|
(1,134
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(36
|
)
|
|
(36
|
)
|
|||||
Change in fair value of derivative liabilities
|
—
|
|
|
—
|
|
|
—
|
|
|
(69
|
)
|
|
(69
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
6
|
|
|||||
Depreciation and amortization
|
—
|
|
|
—
|
|
|
—
|
|
|
171
|
|
|
171
|
|
|
Three Months Ended September 30, 2016
|
||||||||||||||||||
(In thousands)
|
Core
|
|
OEM
|
|
Advanced Energy
|
|
Corporate (Other)
|
|
Total
|
||||||||||
Sales
|
$
|
6,902
|
|
|
$
|
1,762
|
|
|
$
|
1,399
|
|
|
$
|
—
|
|
|
$
|
10,063
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from operations
|
2,089
|
|
|
690
|
|
|
(707
|
)
|
|
(2,317
|
)
|
|
(245
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(37
|
)
|
|
(37
|
)
|
|||||
Change in fair value of derivative liabilities
|
—
|
|
|
—
|
|
|
—
|
|
|
(683
|
)
|
|
(683
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Depreciation and amortization
|
—
|
|
|
—
|
|
|
—
|
|
|
201
|
|
|
201
|
|
|
Nine Months Ended September 30, 2017
|
||||||||||||||||||
(In thousands)
|
Core
|
|
OEM
|
|
Advanced Energy
|
|
Corporate (Other)
|
|
Total
|
||||||||||
Sales
|
$
|
20,959
|
|
|
$
|
2,030
|
|
|
$
|
4,546
|
|
|
$
|
—
|
|
|
$
|
27,535
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from operations
(1)
|
6,471
|
|
|
1,031
|
|
|
(3,821
|
)
|
|
(7,858
|
)
|
|
(4,177
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(103
|
)
|
|
(103
|
)
|
|||||
Change in fair value of derivative liabilities
|
—
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|
57
|
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
15
|
|
|||||
Depreciation and amortization
|
—
|
|
|
—
|
|
|
—
|
|
|
527
|
|
|
527
|
|
|
Nine Months Ended September 30, 2016
|
||||||||||||||||||
(In thousands)
|
Core
|
|
OEM
|
|
Advanced Energy
|
|
Corporate (Other)
|
|
Total
|
||||||||||
Sales
|
$
|
20,261
|
|
|
$
|
4,351
|
|
|
$
|
2,521
|
|
|
$
|
—
|
|
|
$
|
27,133
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from operations
|
5,047
|
|
|
2,498
|
|
|
(3,331
|
)
|
|
(6,962
|
)
|
|
(2,748
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense, net
|
—
|
|
|
—
|
|
|
—
|
|
|
(125
|
)
|
|
(125
|
)
|
|||||
Change in fair value of derivative liabilities
|
—
|
|
|
—
|
|
|
—
|
|
|
(555
|
)
|
|
(555
|
)
|
|||||
Income tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Depreciation and amortization
|
—
|
|
|
—
|
|
|
—
|
|
|
355
|
|
|
556
|
|
(1)
|
During the first and second quarter of 2017, marketing expenses were considered as attributable only to the Corporate (Other) segment in the line Income (loss) from operations. Beginning with the third quarter of 2017, it was determined that certain marketing expenses are attributable to specific segments. The disclosure of Income (loss) from operations was updated for the third quarter of 2017 to reflect marketing expense by segment.
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Sales by Product Line
|
|
|
|
|
|
|
|
||||||||
Electrosurgical
|
$
|
6,205
|
|
|
$
|
5,690
|
|
|
$
|
17,741
|
|
|
$
|
15,020
|
|
Cauteries
|
1,696
|
|
|
1,863
|
|
|
5,224
|
|
|
5,417
|
|
||||
Lighting
|
573
|
|
|
740
|
|
|
1,966
|
|
|
2,046
|
|
||||
Other
|
873
|
|
|
1,770
|
|
|
2,604
|
|
|
4,650
|
|
||||
Total
|
$
|
9,347
|
|
|
$
|
10,063
|
|
|
$
|
27,535
|
|
|
$
|
27,133
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Sales by Domestic and International
|
|
|
|
|
|
|
|
||||||||
Domestic
|
$
|
7,978
|
|
|
$
|
8,730
|
|
|
$
|
23,678
|
|
|
$
|
23,102
|
|
International
|
1,369
|
|
|
1,333
|
|
|
3,857
|
|
|
4,031
|
|
||||
Total
|
$
|
9,347
|
|
|
$
|
10,063
|
|
|
$
|
27,535
|
|
|
$
|
27,133
|
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Sales by Reportable Segment
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Core
|
$
|
6,696
|
|
|
$
|
6,902
|
|
|
(3.0
|
)%
|
|
$
|
20,959
|
|
|
$
|
20,261
|
|
|
3.4
|
%
|
OEM
|
525
|
|
|
1,762
|
|
|
(70.2
|
)%
|
|
2,030
|
|
|
4,351
|
|
|
(53.3
|
)%
|
||||
Advanced Energy
|
2,126
|
|
|
1,399
|
|
|
52.0
|
%
|
|
4,546
|
|
|
2,521
|
|
|
80.3
|
%
|
||||
Total
|
$
|
9,347
|
|
|
$
|
10,063
|
|
|
(7.1
|
)%
|
|
$
|
27,535
|
|
|
$
|
27,133
|
|
|
1.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales by Product Line
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Electrosurgical
|
$
|
6,205
|
|
|
$
|
5,690
|
|
|
9.1
|
%
|
|
$
|
17,741
|
|
|
$
|
15,020
|
|
|
18.1
|
%
|
Cauteries
|
1,696
|
|
|
1,863
|
|
|
(9.0
|
)%
|
|
5,224
|
|
|
5,417
|
|
|
(3.6
|
)%
|
||||
Lighting
|
573
|
|
|
740
|
|
|
(22.6
|
)%
|
|
1,966
|
|
|
2,046
|
|
|
(3.9
|
)%
|
||||
Other
|
873
|
|
|
1,770
|
|
|
(50.7
|
)%
|
|
2,604
|
|
|
4,650
|
|
|
(44.0
|
)%
|
||||
Total
|
$
|
9,347
|
|
|
$
|
10,063
|
|
|
(7.1
|
)%
|
|
$
|
27,535
|
|
|
$
|
27,133
|
|
|
1.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Sales by Domestic and International
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Domestic
|
$
|
7,978
|
|
|
$
|
8,730
|
|
|
(8.6
|
)%
|
|
$
|
23,678
|
|
|
$
|
23,102
|
|
|
2.5
|
%
|
International
|
1,369
|
|
|
1,333
|
|
|
2.7
|
%
|
|
3,857
|
|
|
4,031
|
|
|
(4.3
|
)%
|
||||
Total
|
$
|
9,347
|
|
|
$
|
10,063
|
|
|
(7.1
|
)%
|
|
$
|
27,535
|
|
|
$
|
27,133
|
|
|
1.5
|
%
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Cost of sales
|
$
|
4,753
|
|
|
$
|
5,002
|
|
|
(5.0
|
)%
|
|
$
|
13,673
|
|
|
$
|
14,049
|
|
|
(2.7
|
)%
|
Percentage of revenue
|
50.9
|
%
|
|
49.7
|
%
|
|
|
|
|
49.7
|
%
|
|
51.8
|
%
|
|
|
|
Gross profit
|
$
|
4,594
|
|
|
$
|
5,061
|
|
|
(9.2
|
)%
|
|
$
|
13,862
|
|
|
$
|
13,084
|
|
|
5.9
|
%
|
Percentage of revenue
|
49.1
|
%
|
|
50.3
|
%
|
|
(1.2
|
)%
|
|
50.3
|
%
|
|
48.2
|
%
|
|
2.1
|
%
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Research and Development expense
|
$
|
610
|
|
|
$
|
681
|
|
|
(10.4
|
)%
|
|
$
|
2,015
|
|
|
$
|
1,941
|
|
|
3.8
|
%
|
Percentage of revenue
|
6.5
|
%
|
|
6.8
|
%
|
|
|
|
7.3
|
%
|
|
7.2
|
%
|
|
0.1
|
%
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Professional services expense
|
$
|
421
|
|
|
$
|
292
|
|
|
44.2
|
%
|
|
$
|
1,291
|
|
|
$
|
1,045
|
|
|
23.4
|
%
|
Percentage of revenue
|
4.5
|
%
|
|
2.9
|
%
|
|
1.6
|
%
|
|
4.7
|
%
|
|
3.9
|
%
|
|
0.8
|
%
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Salaries and related expenses
|
$
|
2,080
|
|
|
$
|
2,192
|
|
|
(5.1
|
)%
|
|
$
|
6,783
|
|
|
$
|
6,492
|
|
|
4.5
|
%
|
Percentage of revenue
|
22.3
|
%
|
|
21.8
|
%
|
|
|
|
24.6
|
%
|
|
23.9
|
%
|
|
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
SG&A Expense
|
$
|
2,617
|
|
|
$
|
2,141
|
|
|
22.2
|
%
|
|
$
|
7,950
|
|
|
$
|
6,354
|
|
|
25.1
|
%
|
Percentage of revenue
|
28.0
|
%
|
|
21.3
|
%
|
|
|
|
28.9
|
%
|
|
23.4
|
%
|
|
|
|
Three Months Ended
September 30, |
|
|
|
Nine Months Ended
September 30, |
|
|
||||||||||||||
(In thousands)
|
2017
|
|
2016
|
|
Change
|
|
2017
|
|
2016
|
|
Change
|
||||||||||
Interest expense, net
|
$
|
(36
|
)
|
|
$
|
(37
|
)
|
|
(2.7
|
)%
|
|
$
|
(103
|
)
|
|
$
|
(125
|
)
|
|
(17.6
|
)%
|
Percentage of revenue
|
(0.4
|
)%
|
|
(0.4
|
)%
|
|
|
|
(0.4
|
)%
|
|
(0.5
|
)%
|
|
|
||||||
Change in fair value of derivative liabilities
|
$
|
(69
|
)
|
|
$
|
(683
|
)
|
|
(89.9
|
)%
|
|
$
|
57
|
|
|
$
|
(555
|
)
|
|
(110.3
|
)%
|
Percentage of revenue
|
(0.7
|
)%
|
|
(6.8
|
)%
|
|
|
|
0.2
|
%
|
|
(2.0
|
)%
|
|
|
3.1
|
|
|
3.2
|
|
|
3.3
|
|
|
3.4
|
|
|
3.5*
|
|
|
31.1*
|
|
|
31.2*
|
|
|
32.1*
|
|
|
32.2*
|
|
|
101.INS**
|
|
XBRL Instance Document
|
101.SCH**
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL**
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF**
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB**
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE**
|
|
XBRL Taxonomy Extension Label Presentation Document
|
|
Bovie Medical Corporation
|
|
|
|
|
|
|
Date: November 3, 2017
|
By:
|
/s/ Robert L. Gershon
|
|
|
|
Robert L. Gershon
|
|
|
|
Chief Executive Officer and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
Date: November 3, 2017
|
By:
|
/s/ Jay D. Ewers
|
|
|
|
Jay D. Ewers
|
|
|
|
Chief Financial Officer,
|
|
|
|
Treasurer and Secretary
|
|
|
|
(Principal Financial Officer)
|
|
1.
|
The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on December 3, 1982, a Certificate of Amendment of the Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on February 15, 1983, a Certificate of Amendment of the Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on March 22, 1983, a Certificate of Amendment of the Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on December 23, 1987, a Certificate for Renewal and Revival of Charter was filed with the Secretary of State of the State of Delaware on March 16, 1993, a Certificate of Amendment of the Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on September 8, 1998, a Certificate of Designation, Preferences and Rights of Series A Preferred Stock was filed with the Secretary of State of the State of Delaware on September 8, 1998, a Certificate of Amendment of the Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on September 14, 1998, and a Certificate of Designation of Preferences, Rights and Limitations of Series B Convertible Preferred Stock was filed with the Secretary of State of the State of Delaware on March 16, 2015.
|
2.
|
Article Fourth of the Certificate of Incorporation of the Corporation, as amended to date, is hereby further amended whereby Paragraph FOURTH is hereby amended to read as follows:
|
3.
|
This amendment to the Certificate of Incorporation was authorized at a meeting of the Shareholders by the majority vote of all the outstanding shares entitled to vote thereon.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Bovie Medical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.
|
Date: November 3, 2017
|
By:
|
/s/ Robert L. Gershon
|
|
|
|
Robert L. Gershon
|
|
|
|
Chief Executive Officer
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Bovie Medical Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.
|
Date: November 3, 2017
|
By:
|
/s/ Jay D. Ewers
|
|
|
|
Jay D. Ewers
|
|
|
|
Chief Financial Officer
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
|
Date: November 3, 2017
|
By:
|
/s/Robert L. Gershon
|
|
|
|
Robert L. Gershon
|
|
|
|
Chief Executive Officer
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
|
Date: November 3, 2017
|
By:
|
/s/Jay D. Ewers
|
|
|
|
Jay D. Ewers
|
|
|
|
Chief Financial Officer
|
|