Skyline Medical Inc (NASDAQ:SKLN) is closing in on a joint venture with Electronic On –Ramp weeks after posting a bigger than expected second quarter net loss of $2.5 million compared to $1.128 million for the same period last year. The developer of Streamway waste fluid disposal system says it has signed a letter of intent paving the way for it to gain access to procurements contracts for up to $550 million.
Bolstering Revenue Streams
Skyline is coming from one of the most difficult quarters its revenues having dropped by more than half. The company is in dire need of new avenues for revenue if it is to avert a further slump in earnings going forward.
A joint venture with Electronics’ On-Ramp provides an easy way out of the current standoff. The company has already pre-negotiated contractual terms for two contracts that could provide it with access to efficient sales tools thus help bolster its revenue base.
“We are very excited to enter into this new joint venture with EOR as it provides access to significant federal, state and local funds some 18 months ahead of Skyline’s previous plan […] said Dr. Carl Schwartz, Interim CEO.
A joint venture will also provide Skyline with access to EOR other existing contract vehicles thus help expand its operations away from the sale of STREAMWAY Systems and disposable products. In addition to pursuing new revenue stream with the EOR joint venture, Skyline remains focused on ramping up direct and distributed sales for its products. Expansion into new markets such as Europe and Canada is a core objective in pursuit of new sales channels.
Management Proposal
Separately, Glass, Lewis & Co Inc, one of Skyline Medical Inc (NASDAQ:SKLN) proxy advisory firm is urging shareholders to vote for the approval of an increase of authorized common shares from the current 100M to 200M. The firm also wants shareholders to approve a reverse stock split at a ratio of one to two and one for 25 at the upcoming shareholders meeting on September 15, 2016.
“We’re constantly looking on the outside for great talent and great intellectual property,” he said. “We have been buying companies on average every three to four weeks or so.” Apple CEO, Tim Cook.
