October 18, 2012

CRH Medical Announces Third Quarter Results

Third Quarter Revenue Increases 23% Compared to Same Period Last Year

VANCOUVER, B.C. – October 18, 2012 – CRH Medical Corporation (TSX-V: CRM, OTCQX: CRMMF), a North American medical company focussed on providing physicians with innovative products for the treatment of gastrointestinal diseases, today announced its unaudited financial results for the three and nine months ended September 30, 2012. All financial results are expressed in U.S dollars.

 

Third Quarter Financial Highlights               

(in 000’s of US$)

Q3 2012

Q3 2011

Change

9-Month 2012

9-Month 2011

Change

Revenue

$1,722

$1,396

+23%

$5,092

$3,994

+27%

Net income

$338

$301

+12%

$1,035

$650

+59%

Total operating expenses

$1,389

$1,115

+25%

$4,070

$3,387

+20%

“The third-quarter launch of our Clinical Sales Support Program with Magellan Medical Technology Consultants exemplifies our commitment to invest in initiatives that are designed to help scale our revenues going forward,” said Edward Wright, Chief Executive Officer of CRH Medical. “Over the past several quarters, our direct-to-physician model for the O’Regan System has produced strong results. It is important that we leverage the momentum we’ve created in order to evolve as a business, and realize the potential of both our product and our company to create greater value for our shareholders.”

The Company’s lead product, the O’Regan System is a single use, disposable, hemorrhoid treatment that is safe and highly effective in treating hemorrhoid grades I – IV.  The Company’s goal is to establish the O’Regan System as the standard of care for hemorrhoid treatment. In addition to the product, CRH Medical delivers clinical, marketing and operational support directly to its partner physicians.

Operational Highlights

  •  Announced a Clinical Sales Support Program with Magellan Medical Technology Consultants Inc. to support the Company’s long-term revenue growth and profitability. Magellan will work with CRH Medical to create a clinical, sales, and marketing team. This team will work to increase the adoption of the CRH O’Regan System within practices already trained by the Company, and introduce the technology to practices not yet trained.
  •  Started marketing the CRH O’Regan System directly to the general surgeon community. The Company acquired a database of 15,000 general surgeons in the United States which it is using to introduce surgeons to the CRH O’Regan System. The Company also attended the American College of Surgeons Annual Clinical Congress held in Chicago at the end of September.
  • As of September 30, 2012 the Company had trained 1,269 physicians to use the O’Regan System, representing 425 clinical practices. During the same period a year earlier, the Company had trained 966 physicians, representing 312 clinical practices.
  •  As of September 30, 2012, the Company had $4,259,710 in cash and cash equivalents compared to $2,867,296 as of December 31, 2011.

 Financial Results

Revenues for the three months ended September 30, 2012 were $1,721,601 compared to $1,396,170 for the three months ended September 30, 2011. Revenues for the nine months ended September 30, 2012 were $5,091,696 compared to $3,994,062 for the nine months ended September 30, 2011. The increase in revenue is the result of the Company’s sales of its CRH O’Regan System directly to physicians.

Product sales expenses for the three months ended September 30, 2012 were $1,008,797 compared to $673,226 for the three months ended September 30, 2011. Product sales expenses for the nine months ended September 30, 2012 were $2,736,578 compared to $1,982,824 for the nine months ended September 30, 2011. The increase in product sales expenses is a result of the increase in product sales, physician marketing expenses to increase demand for trainings, and practice support initiatives to increase physician use of our technology.  Product sales expense for the three and nine months ending September 30, 2012 also include start-up expenses related to the Company’s recently announced Clinical Sales Program. Product sales expense for the three and nine months ending September 30, 2012 also include start-up expenses related to the Company’s recently announced Clinical Sales Program and expenses associated with activities related to our attempt to obtain regulatory approval for the CRH O’Regan System in China.

Corporate expenses for the three months ended September 30, 2012 were $380,061 compared to $442,023 for the three months ended September 30, 2011.  Corporate expenses for the nine months ended September 30, 2012 were $1,333,560 compared to $1,403,839 for the nine months ended September 30, 2011. Included in corporate expenses for the nine months ended September 30, 2011 are one-time charges totaling approximately $60,000 associated with the Company graduating from the Toronto Venture Exchange to the Toronto Stock Exchange on May 29, 2011.

For the three months ended September 30, 2012, the Company recorded net income of $337,534 ($0.007 income per share basic and diluted) compared to net income of $301,087 ($0.006 and $0.006 income per share, basic and diluted) for the three months ended September 30, 2011.

For the nine months ended September 30, 2012, the Company recorded net income of $1,035,467 ($0.021 income per share basic and diluted) compared to net income of $649,768 ($0.013 and $0.012 income per share, basic and diluted) for the nine months ended September 30, 2011.

The Company’s September 30, 2012 financial report and corresponding MD&A will be available on www.sedar.com and the Company website at www.crhmedcorp.com.

Third Quarter, 2012 Conference Call Notification

CRH Medical will host telephone conference call to discuss the quarter on Thursday, October 18, 2012 at 5:00 pm Eastern Time. The telephone numbers for the conference call
are (888) 231-8191 or (647) 427-7450.

At the call’s completion, an audio replay will be available by calling (855) 859-2056 and using passcode 47908975. The phone replay will be available through November 1, 2012.

About CRH Medical Corporation:

CRH Medical Corporation is North American company focussed on providing physicians with innovative products for the treatment of gastrointestinal diseases. The Company’s lead product, the CRH O’Regan System, is a single use, disposable, hemorrhoid treatment that is safe and highly effective in treating hemorrhoid grades I – IV. The O’Regan System is rapidly emerging as the standard of care with gastroenterologists who treat hemorrhoids. In addition to the product, CRH Medical delivers clinical, marketing and operational support directly to its partner physicians. CRH utilizes its web-based platform to connect doctors with patients as well as educating its ever increasing install base of physicians.

For more information, please contact:

 

Edward Wright, Chief Executive Officer

CRH Medical Corporation

604.633.1440 x1008

ewright@crhmedcorp.com

 

or

 

Adam Peeler, Media and Investor Relations

TMX Equicom

416.815.0700 x 225

apeeler@tmxequicom.com

 

 

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