Friday, November 13, 2009
Luna reports further losses
The company is still struggling with a $36.3 million civil verdict and bankruptcy.
The latest from The Ticker blog
As it struggles to overcome a $36.3 million civil verdict and the bankruptcy reorganization that followed, Roanoke-based Luna Innovations Inc. posted another net loss in the third quarter of the year.
Revenues for the period that ended Sept. 30 were $8.9 million, compared with $10.7 million for the same three-month period the year before -- a decrease of 17 percent.
The company suffered a net loss of $2 million in the third quarter.
Although Luna has yet to be profitable since becoming publicly traded in June 2006, the most recent net loss was less than the high-tech company experienced in the first two quarters.
In the third quarter, Luna spent about $900,000 on its reorganization and another $700,000 in legal fees associated with its loss in a multimillion-dollar trade secrets case.
"Excluding those costs and fees in both periods, our operating expenses for the most recent quarter would have decreased by approximately $1 million compared to the same period last year, and our operating loss would have been an improvement compared to the third quarter of last year," Kent Murphy, chairman and CEO of Luna, said in a news release Thursday.
The report on Luna's financial health came just one day before the deadline for lawyers who have been working since September to settle a massive civil verdict against the company.
In April, a California jury ordered Luna to pay $36.3 million to Hansen Medical Inc., which had accused the company of stealing its trade secrets as they explored the possibility of working together to develop a catheter for high-tech surgeries.
Luna filed for bankruptcy three months later. In September, both sides said they had reached a tentative settlement. But since then, several deadlines have come and gone as lawyers haggled over the details.
The latest deadline is 5 p.m. today. If Luna and Hansen were to remain at odds, it could fall to bankruptcy Judge William Stone to determine how much Luna should pay. Stone has already indicated in court filings that a $26 million portion of the verdict would likely be reversed.
In a conference call with investors, Murphy said a final agreement had not been reached by 5 p.m. Thursday.
In other financial results, which were announced after the stock markets closed, Luna's gross profit in the third quarter decreased from $4.3 million to $3.5 million, and loss per share increased from 4 to 18 cents.
Headquartered in Roanoke's Riverside Center medical complex, Luna develops and manufactures products for health care, telecommunications, energy and defense markets. It also has facilities in Blacksburg, Charlottesville and Danville.
Shares of Luna closed Thursday at $1.46, up 7 cents from the previous close.
