WNDM Files Q1 Results; Company Reports Record Revenue; Cash Position at All-Time High

News provided by

Wound Management Technologies, Inc.

May 18, 2011, 08:30 ET

FORT WORTH, Texas, May 18, 2011 /PRNewswire/ -- Wound Management Technologies, Inc., (OTCQB: WNDM | WNDM.PK) a leader in advanced wound care solutions, announced financial results for its first quarter of 2011.  For the three-month period ending March 31, 2011, revenue was $935,412, a 1,303% increase over first quarter 2010 net revenue of $66,960.  The increase in revenue was primarily attributable to enhanced sales efforts in 2010, which continued into the first quarter of 2011.  The Company had a loss of $2,743,921 for the first quarter of 2011, as compared to a loss of $1,244,507 for the first quarter of 2010.  The loss in the first quarter of 2011 included a non-cash loss of $1,950,882 related to the conversion of certain debt of the Company into equity.  Cash flow from operations at 3/31/11 was positive for the first time in the Company’s history, $124,278 as compared to a negative cash flow from operations of $284,810 at 3/31/10.

Key Financial Comparisons between Q1 2011 & Q1 2010:

  • Gross profit rose 1717% to $840,994 versus $46,293.
  • Current assets rose 169% to $2,288,521 versus $850,092.
  • Current liabilities dropped 29% to $2,468,869 versus $3,479,189.
  • Weighted-average number of common shares rose 37% to 46,423,395 from 33,948,681
  • Stockholders' equity rose 87% to $5,377,356.
  • Cash on hand as of March 31, 2011, was $1,021,507 versus cash of $50,835 in the prior comparable period.

Scott Haire, Wound Management Technologies CEO, commented, " We are very pleased with our first quarter results as well as with the Company’s outlook.  During the first quarter, Wound Management achieved several key milestones:  a record high in quarterly revenues equal to roughly all of the Company’s 2010 revenues, a significantly improved balance sheet, our first positive cash flow from operations, and the completion of financing that left the company with more than $1M in cash.”

"The Company is executing extremely well. We expect revenues to continue to increase throughout the remainder of 2011 driven primarily by sales from our existing distributors as well as the opening of new markets for CellerateRx® worldwide."

Deborah Jenkins Hutchinson, President of Wound Management Technologies, stated, "We have met the initial goals of our 2011 business plan.  The Company has reached milestone revenue targets, rolled out direct-to-consumer sales, and closed an agreement with a major channel partner in Juventus.  In Q2, the Company should continue to execute on the business initiatives stated in the Letter to the Shareholders dated April 20, 2011.  Some of the progress investors can anticipate includes increasing sales, an agreement for CellerateRx® to go on formulary at a major healthcare system, and entry into the government healthcare market."

The unaudited condensed financial statements of the Company as of March 31, 2011 follow. These should be read in conjunction with the accompanying notes included in the Company's quarterly report on form 10-Q filed with the Securities and Exchange Commission on May 16, 2011, and the Company's December 31, 2010 audited financial statements included in its annual report on form 10-K filed with the Securities and Exchange Commission on April 14, 2011.

PART I – FINANCIAL INFORMATION

WOUND MANAGEMENT TECHNOLOGIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

MARCH 31, 2011 (UNAUDITED) and DECEMBER 31, 2010 (AUDITED)







ASSETS

March 31, 2011

December 31, 2010







CURRENT ASSETS:





   Cash

$

1,021,507

$

50,835

   Accounts Receivable, net

197,698


450,142

   Inventory, net

341,927


290,034

   Notes Receivable - Related Parties

669,425


13,782

   Accrued Interest  - Related Parties

57,964


45,299

Total Current Assets

2,288,521


850,092









LONG-TERM ASSETS:







   Property and Equipment, net

100,534


806

   Intangible Assets

3,993,406


4,110,859

   Deferred Loan Costs

80,684


89,170

   Prepaid and Other Assets

183,995


107,150

   Note Receivable

1,500,000


1,500,000

   Accrued Interest

159,000


125,250

Total Long Term Assets

6,017,619


5,933,235









TOTAL ASSETS

$

8,306,140

$

6,783,327









LIABILITIES AND STOCKHOLDERS' EQUITY
















CURRENT LIABILITIES:







   Accounts Payable

$

274,850

$

321,352

   Accrued Royalties

69,915


428,238

   Accrued Liabilities

638,289


458,218

   Accrued Interest - Related Parties

110,955


101,815

   Accrued Interest

58,535


23,945

   Notes Payable - Related Parties

170,136


1,818,561

   Notes Payable, net of discount

1,092,689


327,060

   Stock Subscription Payable

53,500


-

Total Current Liabilities

2,468,869


3,479,189









LONG-TERM LIABILITIES







   Debentures, net of discount

459,915


435,346

TOTAL LIABILITIES

2,928,784


3,914,535









STOCKHOLDERS' EQUITY







   Series B Preferred Stock, $10 par value, 75,000

   shares authorized; 0  issued and outstanding

-


-

   Common Stock: $.001 par value; 100,000,000

   shares authorized; 55,456,772 issued and

   55,452,683 outstanding as of March 31, 2011 and

   41,316,930 issued and 41,312,841 outstanding as

   of December 31, 2010

55,457


41,317

   Additional Paid-in Capital

31,294,753


26,056,408

   Stock Subscription Receivable

(292,074)


(292,074)

   Treasury Stock

(12,039)


(12,039)

   Accumulated Deficit

(25,668,741)


(22,924,820)

Total Stockholders' Equity

5,377,356


2,868,792

TOTAL LIABILITIES AND STOCKHOLDERS'







EQUITY

$

8,306,140

$

6,783,327


WOUND MANAGEMENT TECHNOLOGIES, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE MONTHS ENDED MARCH 31, 2011 AND 2010









THREE MONTHS

THREE MONTHS


ENDED

ENDED


March 31, 2011

March 31, 2010














REVENUES

$

935,412

$

66,690









COST OF GOODS SOLD

94,418


20,397









GROSS PROFIT

840,994


46,293









GENERAL AND ADMINISTRATIVE EXPENSES:
















General and Administrative Expenses

1,057,943


387,843

Depreciation / Amortization

259,110


117,940

INCOME (LOSS) FROM CONTINUING OPERATIONS:

(476,059)


(459,490)









OTHER INCOME (EXPENSES):







Loss on Debt Settlement

(1,950,882)


(720,657)

Interest Income

49,441


25,994

Interest Expense

(366,421)


(90,354)









LOSS BEFORE INCOME TAXES

(2,743,921)


(1,244,507)

   Current tax expense

-


-

   Deferred tax expense

-


-

NET LOSS

$

(2,743,921)

$

(1,244,507)









Basic and diluted loss per share of common stock

$

(0.06)

$

(0.04)









Weighted average number of common shares outstanding

46,423,395


33,948,681


WOUND MANAGEMENT TECHNOLOGIES, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE THREE MONTHS ENDED MARCH 31, 2011 and 2010









2011

2010

Cash flows from operating activities:





Net loss from continuing operations

$

(2,743,921)

$

(1,244,507)

Adjustments to reconcile net loss to net cash provided (used) in







operating activities:







     Depreciation and amortization

259,110


117,940

 Amortization of discounts and deferred costs

194,014


13,655

 Stock issued for debt related costs

405,580


-

 Stock issued as payment for services

112,000


70,050

 Loss on debt settlement

1,950,882


720,657

     Non-cash expenses

50,347


21,019

Changes in assets and liabilities:







    (Increase) decrease in accounts receivable

252,444


(2,435)

    (Increase) decrease in inventory

(51,893)


379

(Increase) decrease in accrued interest receivable - related parties

(15,690)


(15,820)

(Increase) decrease in accrued interest receivable

(33,750)


(22,125)

(Increase) decrease in prepaids and other assets

107,150


27,549

    Increase (decrease) in accrued royalties

(358,323)


2,125

    Increase (decrease) in accounts payable

(230,498)


(29,638)

Increase (decrease) in accrued liabilities

180,071


(746)

Increase (decrease) in accrued interest payable - related parties

12,165


50,437

Increase (decrease) in accrued interest payable

34,590


6,650

Net cash flows provided (used) in operating activities

124,278


(284,810)









Cash flows from investing activities:







Cash paid in acquisitions

-


(100,000)

Purchase of notes receivable - related parties

(2,231,658)


(103,950)

Proceeds from notes receivable - related parties

1,546,120


41,413

Net cash flows used in investing activities

(685,538)


(162,537)









Cash flows from financing activities:







Net change in overdraft

-


(4,363)

Proceeds from notes payable - related parties

61,500


512,587

Payments on notes payable - related parties

(952,268)


(7,050)

Proceeds from notes payable

2,060,000


102,500

Payments on notes payable

(537,000)


(153,775)

Proceeds from sale of stock

868,700


-

Proceeds from stock subscriptions payable

31,000


-

Net cash flows provided by financing activities

1,531,932


449,899









Increase in cash

970,672


2,552









Cash and cash equivalents, beginning of period

50,835


-

Cash and cash equivalents, end of period

$

1,021,507

$

2,552

About Wound Management Technologies, Inc.

Wound Management Technologies, Inc. is an emerging commercial stage company with its primary products in the $5B worldwide advanced wound care market. Wound Management's primary focus is the distribution of its unique, patented collagen product, CellerateRX®, which is FDA cleared and reimbursable under Medicare Part B. Wound Management has other advanced biotech products in development including a patented resorbable bone wax line that is in late stages of development, as well as a subsidiary focused on technology for secure healthcare data collaboration and storage.  More information can be found on the company's web sites: http://www.wmgtech.com and http://www.celleraterx.com.

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Safe Harbor Statement:

The statements in the press release that relate to the company's expectations with regard to the future impact on the company's results from new products in development and any other statements not constituting historical facts are "forward-looking statements," within the meaning of and subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. Since this information may contain statements that involve risk and uncertainties and are subject to change at any time, the company's actual results may differ materially from expected results. This document may contain forward-looking statements concerning the Company's operations, current and future performance and financial condition. These items involve risks, contingencies and uncertainties such as product demand, market and customer acceptance, the effect of economic conditions, competition, pricing, the ability to consummate and integrate acquisitions, and other risks, contingencies and uncertainties detailed in the Company's SEC filings, which could cause the company's actual operating results, performance or business plans or prospects to differ materially from those expressed in, or implied by these statements. The Company undertakes no obligation to revise any of these statements to reflect the future circumstances or the occurrence of unanticipated events.

For Wound Management Technologies Shareholder Information please call (917) 974-9872 or visit http://www.wmgtech.com

SOURCE Wound Management Technologies, Inc.

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