INTELGENX TECHNOLOGIES CORP., 10-Q filed on 5/15/2012
Quarterly Report
Document and Entity Information
3 Months Ended
Mar. 31, 2012
May 10, 2012
Document and Entity Information
 
 
Document Type
10-Q 
 
Amendment Flag
false 
 
Document Period End Date
Mar. 31, 2012 
 
Trading Symbol
igxt 
 
Entity Registrant Name
IntelGenx Technologies Corp. 
 
Entity Central Index Key
0001098880 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Smaller Reporting Company 
 
Entity Common Stock, Shares Outstanding
 
49,621,859 
Entity Current Reporting Status
Yes 
 
Entity Voluntary Filers
No 
 
Entity Well Known Seasoned Issuer
No 
 
Document Fiscal Year Focus
2012 
 
Document Fiscal Period Focus
Q1 
 
Consolidated Balance Sheets (USD $)
Mar. 31, 2012
Dec. 31, 2011
Current
 
 
Cash and cash equivalents
$ 4,059 
$ 3,505 
Accounts receivable
246 
263 
Prepaid expenses
83 
68 
Loan receivable
85 
Investment tax credits receivable
211 
375 
Total Current Assets
4,599 
4,296 
Property and Equipment
333 
149 
Intangible assets
125 
125 
Total Assets
5,057 
4,570 
Current.
 
 
Accounts payable and accrued liabilities
396 
666 
Deferred license revenue
45 
Total Current Liabilities
441 
666 
Deferred license revenue, non-current portion
955 
Shareholders' Equity
 
 
Capital Stock
Additional Paid-in-Capital
16,166 
15,918 
Accumulated Deficit
(12,795)
(12,213)
Accumulated Other Comprehensive Income
290 
199 
Total Stockholder's Equity
3,661 
3,904 
Total Liabilities and Stockholder's Equity
$ 5,057 
$ 4,570 
Consolidated Statements of Operations and Comprehensive Loss (USD $)
3 Months Ended
Mar. 31, 2012
Mar. 31, 2011
Revenue
$ 100 
$ 96 
Other income
185 
Total Revenue
285 
98 
Expenses
 
 
Research and development
445 
329 
Research and development tax credits
(25)
(41)
Management salaries
169 
139 
General and administrative
75 
110 
Professional fees
146 
153 
Depreciation
Foreign exchange
48 
(1)
Interest
Total Operating Expenses
867 
698 
Net Loss
(582)
(600)
Other Comprehensive Loss
 
 
Foreign currency translation adjustment
91 
40 
Comprehensive Loss
$ (491)
$ (560)
Basic and Diluted Weighted Average Number of Shares Outstanding
49,324,531 
39,649,559 
Basic and Diluted Loss Per Common Share
$ (0.01)
$ (0.01)
Consolidated Statements of Cash Flows (USD $)
3 Months Ended
Mar. 31, 2012
Mar. 31, 2011
Funds Provided (Used) - Operating Activities
 
 
Net loss
$ (582)
$ (600)
Depreciation
Stock-based compensation
15 
12 
Accounts receivable write-off
52 
Total Adjustments
(559)
(528)
Changes in assets and liabilities:
 
 
Accounts receivable
18 
(48)
Prepaid and other assets
(15)
(19)
Other receivables
249 
(46)
Accounts payable and other accrued liabilities
(270)
(71)
Deferred revenue
1,000 
Net Cash Provided by Operating Activities
423 
(712)
Financing Activities
 
 
Issue of capital stock
233 
108 
Net Cash Provided by Financing Activities
233 
108 
Investing Activities
 
 
Additions to property and equipment
(189)
(3)
Net Cash Provided by Investing Activities
(189)
(3)
Increase/(Decrease) in Cash and Cash Equivalent
467 
(607)
Effect of Foreign Exchange on Cash and Cash Equivalents
88 
38 
Beginning of Period
3,505 
1,144 
End of Period
$ 4,059 
$ 575 
Consolidated Statement of Shareholders Equity (USD $)
Capital Stock [Member]
Additional Paid-In Capital [Member]
Accumulated Deficit [Member]
Accumulated Other Comprehensive Income [Member]
Total
Beginning Balance at Dec. 31, 2011
$ 0 
$ 15,918 
$ (12,213)
$ 199 
$ 3,904 
Beginning Balance (Shares) at Dec. 31, 2011
48,895,028 
 
 
 
 
Foreign currency translation adjustment
 
 
 
91 
91 
Warrants exercised
 
233 
 
 
233 
Warrants exercised (Shares)
726,830 
 
 
 
 
Stock-based compensation
 
15 
 
 
15 
Net Income (Loss)
 
 
(582)
 
(582)
Ending Balance at Mar. 31, 2012
$ 0 
$ 16,166 
$ (12,795)
$ 290 
$ 3,661 
Ending Balance (Shares) at Mar. 31, 2012
49,621,858 
 
 
 
 
Basis of Presentation
Basis of Presentation [Text Block]
1.
  Basis of Presentation
   
 

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete consolidated financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All such adjustments are of a normal and recurring nature.

 

 

 

These financial statements should be read in conjunction with the audited consolidated financial statements at December 31, 2011. Operating results for the three months ended March 31, 2012 are not necessarily indicative of the results that may be expected for the year ending December 31, 2012. The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). This basis of accounting involves the application of accrual accounting and consequently, revenues and gains are recognized when earned, and expenses and losses are recognized when incurred.

 

 

 

The consolidated financial statements include the accounts of the Company and its subsidiary companies. On consolidation, all inter-entity transactions and balances have been eliminated.

 

 

 

The financial statements are expressed in U.S. funds.

 

 

 

Management has performed an evaluation of the Company’s activities through the date and time these financial statements were issued and concluded that there are no additional significant events requiring recognition or disclosure.

Adoption of New Accounting Standards
Adoption of New Accounting Standards [Text Block]
2.

Adoption of New Accounting Standards

 

 

 

Revenue Recognition and Disclosures

 

 

 

In May 2011, the FASB issued Update No. 2011-04, “Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs”. The amendments in this Update result in common fair value measurement and disclosure requirements in U.S. GAAP and IFRSs. Consequently, the amendments change the wording used to describe many of the requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements. For many of the requirements, the Board does not intend for the amendments in this Update to result in a change in the application of the requirements in Topic 820. Some of the amendments clarify the Board’s intent about the application of existing fair value measurement requirements. Other amendments change a particular principle or requirement for measuring fair value or for disclosing information about fair value measurements. For public entities, ASU 2011-4 is effective during interim and annual periods beginning after December 15, 2011. The adoption of this Statement did not have a material effect on the Company’s financial position or results of operations.

   
 

In June 2011, the FASB issued Update No. 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income”. Under the amendments, an entity has the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. This Update eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholders' equity. The amendments in this Update do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. ASU 2011-05 should be applied retrospectively. For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. Early adoption is permitted. In December 2011 however, the FASB issued Update No. 2011-12, “Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05”. The amendments in this Update supersede changes to those paragraphs in Update 2011-05 that pertain to how, when, and where reclassification adjustments are presented. The adoption of this Statement did not have a material effect on the Company’s financial position or results of operations.

   
 

In September 2011, the FASB issued Update No. 2011-08, “Intangibles—Goodwill and Other (Topic 350): Testing Goodwill for Impairment”. The amendments in this Update will allow an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. Under these amendments, an entity would not be required to calculate the fair value of a reporting unit unless the entity determines, based on a qualitative assessment, that it is more likely than not that its fair value is less than its carrying amount. The amendments include a number of events and circumstances for an entity to consider in conducting the qualitative assessment. For public entities, ASU 2011-08 is effective for annual and interim goodwill impairment tests performed for fiscal years beginning after December 15, 2011. The adoption of this Statement did not have a material effect on the Company’s financial position or results of operations.

Significant Accounting Policies
Significant Accounting Policies [Text Block]
3.

Significant Accounting Policies

   
 

Recently Issued Accounting Pronouncements

   
 

In December 2011, the FASB issued Update No. 2011-11, “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities”. The objective of this Update is to provide enhanced disclosures that will enable users of its financial statements to evaluate the effect or potential effect of netting arrangements on an entity’s financial position. This includes the effect or potential effect of rights of setoff associated with an entity’s recognized assets and recognized liabilities within the scope of this Update. The amendments require enhanced disclosures by requiring improved information about financial instruments and derivative instruments that are either (1) offset in accordance with either Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are offset in accordance with either Section 210-20-45 or Section 815-10-45. ASU 2011-11 is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. Retrospective disclosure is required for all comparative periods presented. The Company is currently evaluating the impact of this Statement on its consolidated financial statements.

   
 

In December 2011, the FASB issued Update No. 2011-12, “Comprehensive Income (Topic 220): Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05”. The amendments in this Update supersede changes to those paragraphs in Update 2011-05 that pertain to how, when, and where reclassification adjustments are presented. The adoption of this amendment is not expected to have a material effect on the Company’s financial position or results of operations, but will affect the presentation of Other Comprehensive Income in the Company’s financial statements.

Deferred License Revenue
Deferred License Revenue [Text Block]
4.

Deferred License Revenue

   
 

Deferred license revenue represents upfront payments received for the granting of licenses to the Company’s patents, intellectual property and proprietary technology for commercialization. Deferred license revenue is recognized in income over the period where sales of the licensed products will occur.

Capital Stock
Capital Stock [Text Block]
5.
 

Capital Stock


      March 31,     December 31,  
      2012     2011  
 

Authorized -

           
 

100,000,000 common shares of $0.00001 par value

           
 

 20,000,000 preferred shares of $0.00001 par value

           
 

Issued -

           
 

 49,621,858 (December 31, 2011 - 48,895,028) common shares

$  496   $  489  
Related Party Transactions
Related Party Transactions [Text Block]
7.

Related Party Transactions

   
 

Included in management salaries are $1 thousand (2011 - $1 thousand) for options granted to the Chief Financial Officer and $2 thousand (2011 - $1 thousand) for options granted to the Chief Executive Officer under the 2006 Stock Option Plan and $7 thousand (2011 - $2 thousand) for options granted to non-employee directors.

   
 

Also included in management salaries are director fees of $27 thousand (2011 - $19 thousand) for attendance to board meetings and audit committee meetings.

   
 

The above related party transactions have been measured at the exchange amount which is the amount of the consideration established and agreed to by the related parties.

Basic and Diluted Loss Per Common Share
Basic and Diluted Loss Per Common Share [Text Block]
8.   Basic and Diluted Loss Per Common Share
   
 

Basic and diluted loss per common share is calculated based on the weighted average number of shares outstanding during the period. The warrants, share-based compensation and convertible notes have been excluded from the calculation of diluted loss per share since they are anti-dilutive.