Cybex International, Medway, MA, officially released its first quarter 2010 financials, showing a 19 percent increase in net sales, but the company also noted that it was unable to secure a bond in its appeal in a $66 million product liability judgment against it.
Cybex had net sales of $31 million in first quarter 2011, which compares to $26.1 million in first quarter 2010. It also had a net profit of $0.4 million compared to a net loss of $0.8 million in first quarter 2010. Although the numbers are higher, they still fall below first quarter 2008 when the company reported $39.8 million in net sales and $1.3 million in net income.
In December, Cybex was found 75 percent liable for a $66 million judgment in the Barnhard v. Cybex International case involving a piece of Cybex equipment that fell on a woman rendering her a quadriplegic.
The company tried to secure a bond from various banks to prevent the plaintiff from collecting on the judgment until Cybex could file an appeal to reduce the amount of the judgment or have it thrown out. So far, Cybex has been unable to secure the bond, it reported. The bond amount typically required is the amount of the judgment for which the defendant is liable.
Cybex has said that it will continue to pursue all avenues to attain a reversal or substantial reduction of the judgment.
“The company is exploring ways of protecting itself during the pendency of its appeals, which will include immediately requesting the Appellate Division to grant a stay of enforcement of the judgment with a limited bonding requirement,” a release from Cybex stated.
The company is also working on a plan to retain its listing on the NASDAQ Stock Market. NASDAQ notified Cybex on April 5 that it was not compliant with a NASDAQ requirement to have a minimum stockholder equity of $10 million. Instead, the company has stockholder equity of negative $15 million. Cybex has until May 20 to send NASDAQ its plan for complying with the requirement or risk being delisted.
In January, NASDAQ threatened delisting due to Cybex’s stock price. The stock market requires that stock prices not drop below $1 for more than 30 consecutive days. Cybex did not meet that requirement at the time of the letter. However, after fourth quarter 2010 and year-end 2010 financials were released on March 31, showing an increase in net sales, Cybex’s stock price began to rise, reaching $1 on April 6.