DATATRAK International, Inc. Announces Second Quarter 2012 Results 33% Growth in New Contract Sales - 36% Backlog Growth - Launch into China Market

CLEVELAND, Aug. 15, 2012 /PRNewswire/ -- DATATRAK International, Inc. (OTCQX: DATA),a technology and services company focused on global eClinical solutions for the clinical trials industry, today announced its operating results for the second quarter of 2012.

"DATATRAK's fortified Sales and Marketing efforts, including a significant rebranding initiative, have amplified the Unified message of DATATRAK ONE™ and enabled us to expand our market position by highlighting the advantages of our solution over legacy technologies – resulting in record backlog levels, which drive top-line growth," stated Laurence P. Birch, DATATRAK's Chairman of the Board and CEO.  "We continue to execute against a solid business strategy, expanding our global reach into China and posting steady increases in clients, trials and financial results."

"DATATRAK's strong achievements for the second quarter are the result of two things," Birch continued, "the strategic growth investments made in Sales, Marketing and Software Development and the industry's validation of a unified, Cloud-based offering.  Many in the industry are reflecting on the supposed nascent nature of Cloud technology in the life sciences arena.  We believe our technology leadership in this area is evidenced by the efforts of many of our competitors to retool their offerings to create "new" technologies that can compete with our advanced platform.   DATATRAK, however, is a pioneer in this space – DATATRAK ONE™ has the leading Cloud functionality coupled with a truly unified system.  As our clients face trends of increased outsourcing and reduced budgets, DATATRAK is poised to help them reduce capital expenditures, lower total cost of ownership and safely accelerate clinical trials."

Highlights for the second quarter of 2012 include:

  • Revenues for the second quarter of 2012 increased 10% over the comparable period for 2011
  • Gross Profit remained stable at 83%
  • Backlog at the end of the quarter totaled approximately $16 million – a 36% increase over backlog at December 31, 2011 and the highest balance in 6 years
  • Solid new contract sales results:
    • New contract sales year-to-date for 2012 outpaced 2011 and 2010 new contract sales by 33% and 85%, respectively
    • In Q2, recognizing the benefits of a Unified Cloud Technology, 71% of all new clients purchased multiple products within the DATATRAK ONE™ Platform
    • NTT DATA signed a multi-year license agreement launching DATATRAK ONE™ into China
    • Pharm-Olam, International, a global CRO, signed a multi-year, multi-million dollar contract standardizing on the cloud-based unified clinical research platform, DATATRAK ONE™
    • RPS, one of the industry's largest contract research organizations (CRO), standardized on DATATRAK ONE™
  • Participated in Key Global Events:
    • 4th Annual China DIA Meeting
    • 2012 ASCO Annual Meeting
    • DIA 2012 Annual Meeting
  • Marketing activities:
    • Unveiled new progressive corporate branding
    • Announced the DATATRAK Accreditation Program
    • Received Crain's Leading Edge Award Honor for third consecutive year
  • Platform enhancements:
    • Showcased new interface that redefines the user experience
    • Expanded CDISC Registered Solutions to include Provider Status for Define.XML
    • Released uCTMS 2.0 which provides automatic, systemized data sharing

Financial Highlights:
Driven by the continued improvement in backlog and new contract sales, revenue for the second quarter of 2012 increased 10% to $2.3 million compared to $2.1 million in the second quarter of 2011.  The gross profit margin remained stable at 83% for the three months ended June 30, 2012 compared to 84% for the three months ended June 30, 2011.  The Company's loss from operations for the three months ended June 30, 2012 was $(458,000) compared to $(154,000) for the corresponding period in the prior year.  The operating results for both years reflect the Company's planned strategic investments in Sales, Marketing and Software Development to position the business for future top-line growth, the accrual of management incentive plan awards and sales compensation awards, as well as costs incurred to protect the Company's intellectual property for its customers and partners.

DATATRAK's backlog at June 30, 2012 was $15.8 million compared to a backlog of $11.6 million at December 31, 2011.  Backlog consists of future value from authorization letters to commence services, statements of work, technology and services agreements, change orders and other customer contracts, billed and unbilled.  The improvement in backlog from December 31, 2011 to June 30, 2012 was due to the increase in new contract sales.  New contract sales for 2012 outpaced 2011 new contract sales by 33%.

About DATATRAK International, Inc.
DATATRAK International is a worldwide technology and services company delivering eClinical solutions and related services for the clinical trials industry.  DATATRAK built its multi-component, comprehensive solution on a single, unified platform and expanded this concept to include services delivery via DATATRAK's Clinical and Consulting Services™ group.  The Company delivers a complete portfolio of software products designed to accelerate the reporting of clinical research data from sites to sponsors and ultimately regulatory authorities, faster and more efficiently than loosely integrated technologies.  The DATATRAK ONE™ software solution, deployed worldwide through an ASP or Enterprise Transfer offering, supports Phase I - Phase IV drug and device studies in multiple languages throughout the world.  DATATRAK has offices located in Cleveland, Ohio; Bryan, Texas; and Cary (RTP), North Carolina. For more information, visit http://www.datatrak.net.

All contracts are subject to possible delays or cancellation or can change in scope in a positive or negative direction.  Therefore, current backlog is not necessarily indicative of the Company's future quarterly or annual revenue.  Historically, backlog has been a poor predictor of the Company's short-term revenue.

Except for the historical information contained in this press release, the statements made in this release are forward-looking statements.  These forward-looking statements are made based on management's expectations, assumptions, estimates and current beliefs concerning the operations, future results and prospects of the Company and are subject to uncertainties and factors which are difficult to predict and, in many instances, are beyond the control of the Company, and which could cause actual results to differ materially from those contemplated in these forward-looking statements.  For a list of certain of the factors that may cause actual results to differ materially from those contemplated in these forward looking statements, please see the Company's annual report filed with the OTC Markets on March 16, 2012 announcing its results for the full-year period ending December 31, 2011. The Company undertakes no obligation to update publicly or revise any forward-looking statement whether as a result of new information, future events or otherwise.


 

DATATRAK International, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet Data
(Unaudited)

 


June 30, 2012

December 31, 2011

Cash and investments

$1,557,914

$2,298,690

Accounts receivable, net

1,138,729

758,727

Property & equipment, net

137,088

179,320

Deferred tax assets

20,700

38,500

Other

408,925

393,073

   Total assets

$3,263,356

$3,668,310




Accounts payable and other current liabilities

$1,983,606

$1,623,714

Deferred revenue

2,873,139

3,159,247

Deferred tax liabilities

20,700

38,500

Other long-term liabilities

21,597

29,557

Shareholders'  deficit

(1,635,686)

(1,182,708)

   Total liabilities and shareholders' deficit

$3,263,356

$3,668,310




 

DATATRAK International, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 


For the Three Months Ended June 30,


2012

2011

Revenue

$2,336,734

$2,132,852

Direct costs

404,651

334,216

   Gross profit

1,932,083

1,798,636




Selling, general and administrative expenses

2,351,463

1,913,511

Depreciation and amortization

38,924

38,938

   Loss from operations

(458,304)

(153,813)




Interest income

147

139

Interest expense

(3,991)

(4,581)

   Net loss

$(462,148)

$(158,255)

     Net loss per share:



          Net loss per share, basic and diluted

$(0.03)

$(0.01)

          Weighted-average shares outstanding, basic and diluted

15,311,073

14,325,325

 

DATATRAK International, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

 


For the Six Months Ended June 30,


2012

2011




Revenue

$4,455,932

$4,021,173

Direct costs

801,298

685,194

   Gross profit

3,654,634

3,335,979




Selling, general and administrative expenses

4,550,465

3,608,616

Depreciation and amortization

77,750

79,135

   (Loss) income from operations

(973,581)

(351,772)




Interest income

279

319

Interest expense

(5,646)

(7,255)

   Net income (loss)

$(978,948)

$(358,708)

     Net income (loss) per share:



          Net (loss) income per share, basic and



          Diluted

$(0.07)

$(0.03)

          Weighted-average shares outstanding

15,013,010

14,217,167





SOURCE DATATRAK International, Inc.



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