Advanced Medical Isotope Corp (OTCMKTS:ADMD) Breaks Its Silence
After exactly four months of silence Advanced Medical Isotope Corp (OTCMKTS:ADMD) issued a new PR yesterday. Not only that but the press article actually announced a rather important news – the restructuring of ADMD’s capital. “How important exactly?”, you might ask. Well, let’s just say that the company itself described its financial situation as “grave” in its annual report for 2014. And who would argue when they finished last year with:
• $203 cash
• $30,288 total current assets
• $90,523 total assets
• $20.2 million total current liabilities
• $24,108 annual revenues
• $1.9 million loss from operations
• $18 million annual net loss
Even by pennystock standards such financials are absolutely atrocious. The picture gets even grimmer though when you add the crushing dilution of the common stock that took place last year. At the end of 2013 ADMD had around 120 million outstanding shares but nine months into 2014 that number had nearly tripled reaching 350 million shares. Would you like to guess how many outstanding shares there were just three months later, as of December 31? – 1.7 BILLION. The dilution didn’t stop there and as of April 10, this year, the O/S had reached 1.82 billion. If all of the outstanding options, warrants and convertible notes as of that date were fully converted into common shares ADMD would have to issue another 13.7 BILLION shares.
As we said at the beginning the company was able to renegotiate some of its debt. Around $5 million of the long-term debt will be converted into a newly designated Series A preferred shares that can be turned into common shares at a fixed price of $0.015. Another $1 million of the remaining debt will be exchanged for a non-convertible 6% note that matures on December 31, 2017. In yesterday’s PR the company also announced that they have eliminated approximately $500,000 of seasoned trade payables without causing further dilution.
At the end of October ADMD already increased their authorized shares from 500 million to 2 BILLION. The main source of funds for the company remains the issuance of convertible notes with around $378 thousand worth of notes sold since the start of the year. Depending on how much of their convertible debt is going to remain outside of the announced restructuring plan the company may be forced to increase the A/S even further.
The company remains an extremely volatile choice for investment. There have been no updates about the de novo submission with the Food and Drug Administration announced last December for a marketing clearance for their patented Y-90 RadioGel(TM) device. If the FDA doesn’t have any additional requests a decision is expected within 120 days from the submission. Keep in mind that even if ADMD’s device gets cleared the company will need to raise additional capital for its commercialization.
