BIOLASE, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Supplementary Balance Sheet Information

Supplementary Balance Sheet Information

12 Months Ended

Dec. 31, 2012

NOTE 3 — SUPPLEMENTARY BALANCE SHEET INFORMATION


	December 31,
ACCOUNTS RECEIVABLE (in thousands):	2012		2011
Components of accounts receivable, net of allowances, are as follows:
Trade	$	11,456	$	8,583
Royalties		45		29
Other		179		287

Total receivables, net	$	11,680	$	8,899

Accounts receivable is net of allowances for doubtful accounts and sales returns totaling approximately $414,000 and $399,000 at December 31, 2012 and 2011, respectively.


	December 31,
INVENTORY, NET (in thousands):	2012		2011
Components of inventory, net of allowances, are as follows:
Raw materials	$	4,017	$	4,280
Work-in-process		1,949		2,538
Finished goods		5,176		4,494

Inventory, net	$	11,142	$	11,312

Inventory is net of a provision for excess and obsolete inventory totaling approximately $1.9 million and $2.3 million at December 31, 2012 and 2011, respectively.


	December 31,
PROPERTY, PLANT AND EQUIPMENT, NET (in thousands):	2012			2011
Components of property, plant and equipment, net of depreciation, are as follows:
Land	$	191		$	247
Building		246			317
Leasehold improvements		1,193			957
Equipment and computers		5,219			5,729
Furniture and fixtures		1,046			1,036
Construction in progress		132			26

		8,027			8,312
Accumulated depreciation and amortization		(6,518	)		(7,164	)

Property, plant and equipment, net	$	1,509		$	1,148

On August 21, 2012, pursuant to a Sale and Purchase Agreement entered on June 12, 2012, the Company sold the smaller of two buildings and a portion of the land parcel of its two-building property in Floss, Germany. The purchase price of approximately $136,000 was reduced by transaction costs, resulting in net proceeds of approximately $124,000. As of December 31, 2012, the Company recorded a realized gain on the sale of these assets of approximately $3,000. The Company also undertook an appraisal of the remaining land and building at the Floss property and determined that no impairment charge was necessary.


	December 31,
ACCRUED LIABILITIES (in thousands):	2012		2011
Components of accrued liabilities are as follows:
Payroll and benefits	$	2,326	$	1,928
Warranty accrual, current portion		1,699		2,218
Sales tax		763		526
Accrued professional services		502		669
Accrued insurance premium		751		433
Accrued support services		—		200
Other		226		203

Accrued liabilities	$	6,267	$	6,177


	December 31,
DEFERRED REVENUE (in thousands):	2012			2011
Components of deferred revenue are as follows:
Undelivered elements (training, installation, product and support services)	$	1,723		$	1,105
Extended warranty contracts		1,506			1,056

Total Deferred Revenue		3,229			2,161

Less Long-Term amounts:
Extended warranty contracts		(3	)		(25	)

Total Deferred Revenue — Long Term		(3	)		(25	)

Total Deferred Revenue — Current	$	3,226		$	2,136

On May 20, 2010, the Company entered into a license agreement (the “2010 P&G Agreement”), with Procter and Gamble Company (“P&G”), which replaced an existing license agreement between the Company and P&G (the “2006 P&G Agreement”). Pursuant to the 2010 P&G Agreement, the Company agreed to continue granting P&G an exclusive license to certain of the Company’s patents to enable P&G to develop products aimed at the consumer market and P&G agreed to pay royalties based on sales of products developed with such intellectual property. On June 28, 2011, the Company entered into an amendment to the 2010 P&G Agreement (the “2011 P&G Amendment”) which extended the effective period for the 2010 P&G Agreement from December 31, 2010 through June 30, 2011, and resulted in the Company recognizing the previously deferred $375,000 of revenue as royalty revenue during the quarter ended June 30, 2011.

The 2011 P&G Amendment also provided that effective January 1, 2011, P&G’s exclusive license to the Company’s patents converted to a non-exclusive license unless P&G paid the Company a license payment in the amount of $187,500 by the end of the third quarter of 2011, and at the end of each quarter thereafter, throughout the term of the 2010 P&G Agreement. As a result of P&G not making any payments to the Company in the third and fourth quarters of the year ended December 31, 2011, their license converted to a non-exclusive license. The Company is currently engaged in an active collaboration with P&G to commercialize a consumer product utilizing its patents.