Guided Therapeutics Inc (OTCBB:GTHP) Crashes On Record Volume
Despite some rather positive PRs published in the last couple of days the chart performance of Guided Therapeutics Inc (OTCBB:GTHP) has been simply atrocious. On Tuesday the ticker crashed by more than 31% while yesterday it wiped over a quarter of its value dropping back down to a little over 2 cents per share. It should be noted that yesterday’s crash took place on an unprecedented for GTHP volume of 21.75 million traded shares.
In mid-November GTHP filed their financial report for the third quarter of the year and it did paint a rather depressing picture. At the end of September the company had:
• $172 thousand cash
• $2.28 million total current assets
• $4.96 million total current liabilities
• $94 thousand sales
• $2.19 million sales
GTHP reported a negative working capital of approximately $2.7 million while the accumulated deficit had surpassed $120 million. Far more alarming however was the drastic decrease in sales – for the same period last year the company generated $262 thousand in sales while now they had less than $100 thousand. Despite the reduced sales the cost of goods sold remained rather high – $230 thousand, which resulted in a gross loss for the period of $136 thousand.
Things may be turning around though and for the fourth quarter of 2015 GTHP expects far better results. As part of the four year $14 million purchase order from the Turkish Ministry of Health GTHP has to deliver 25 of its LuViva units and 40 thousand disposables by December 31. Yesterday the company announced that the first four units and 10 thousand of the disposables have been shipped. If everything goes according to plan GTHP projects its revenue for 2015 to reach $1.1 million with $700 thousand generated during the fourth quarter.
As for the U.S. approval of the LuViva Advanced Cervical Scan at the end of November GTHP had a meeting with the FDA and according to the PR from Wednesday the company believes that a general agreement has been reached. Back in May the FDA decided not to approve the company’s application recommending that next time GTHP should include additional patient data. GTHP expect the plan for the collection of the patient data to be completed in the next two to three months.
Investors shouldn’t forget that during the first nine months of the year GTHP issued close to 47 million new shares a large part of which was through the conversion of preferred stock. As of October 30 there were close to 168 million outstanding shares compared to just 97 million outstanding at the end of 2014. At a special meeting of the stockholders held last month an increase of the authorized shares from 500 million to 1 BILLION was approved. In addition the board of directors was allowed to effect a reverse split ranging from 1-for-10 to 1-for-100 at some point during the next three years.
GTHP definitely has some strong points and if they continue to expand their business the stock could be able to move back up the chart. If the ticker jumps above 10 cents per share though the owners of warrants for the purchase of more than 108 million shares with an exercise price of $0.095 could become extremely tempted to turn them into shares.
