Neuronetics Reports Second Quarter 2018 Financial and Operating Results
- Second quarter 2018 revenue of
$13.3 million , an increase of 29% over the second quarter of 2017 - Second quarter 2018 U.S. treatment session revenue of
$8.9 million , an increase of 21% over the second quarter of 2017 - Second quarter 2018 U.S. NeuroStar® Advanced Therapy revenue of
$3.6 million , an increase of 42% over the second quarter of 2017
“We are very proud of our accomplishments during the second quarter of 2018, not only in terms of the growth in new NeuroStar Advanced Therapy Systems and treatment sessions, but also achieving other key milestones we established to attain our goals in 2018 and beyond,” said
Revenues by Geography | ||||||||||
Three Months ended June 30, | ||||||||||
2018 | 2017 | |||||||||
Amount | Amount | % Change | ||||||||
(in thousands, except percentages) | ||||||||||
United States | $ | 12,898 | $ | 10,225 | 26 | % | ||||
International | 354 | 83 | 327 | % | ||||||
Total revenues | $ | 13,252 | $ | 10,308 | 29 | % | ||||
United States Revenues by Product Category | ||||||||||
Three Months ended June 30, | ||||||||||
2018 | 2017 | |||||||||
Amount | Amount | % Change | ||||||||
(in thousands, except percentages) | ||||||||||
NeuroStar Advanced Therapy System | $ | 3,568 | $ | 2,510 | 42 | % | ||||
Treatment sessions | 8,920 | 7,388 | 21 | % | ||||||
Other | 410 | 327 | 25 | % | ||||||
Total United States revenues | $ | 12,898 | $ | 10,225 | 26 | % | ||||
Second Quarter Financial and Operating Results
Total revenue for the second quarter of 2018 was
U.S. NeuroStar Advanced Therapy Revenue for the second quarter of 2018 was
As of
U.S. Treatment Session revenue for the second quarter of 2018 was
Gross margin for the second quarter of 2018 was 75.5%, which was consistent to the second quarter of 2017 gross margin of 75.7%.
Operating expenses during the second quarter of 2018 were
Net loss for the second quarter of 2018 was
EBITDA for the second quarter of 2018 was
Cash and cash equivalents were $14.5 million as of June 30, 2018. This compares to cash and cash equivalents of
Business Outlook
For the full year 2018, the Company expects to report revenue of between
Webcast and Conference Call Information
Neuronetics’ management team will host a conference call on
About
"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995:
Statements in the press release for the second quarter of 2018 regarding
Investor Contact:
Westwicke Partners
443-213-0501
ir@neuronetics.com
Media Contact:
610-455-2742
Lbrown@vaultcommunications.com
Statement of Operations
(Unaudited; In thousands, except per share data)
Three Months ended | Six Months ended | |||||||||||||||
June 30, | June 30, |
|||||||||||||||
2018 | 2017 | 2018 | 2017 |
|||||||||||||
Revenues | $ | 13,252 | $ | 10,308 | $ | 23,404 | $ | 17,834 | ||||||||
Cost of revenues | 3,245 | 2,501 | 5,702 | 4,039 | ||||||||||||
Gross Profit | 10,007 | 7,807 | 17,702 | 13,795 | ||||||||||||
Operating expenses: | ||||||||||||||||
Sales and marketing | 9,835 | 6,400 | 17,944 | 12,706 | ||||||||||||
General and administrative | 3,078 | 1,837 | 5,714 | 3,479 | ||||||||||||
Research and development | 2,330 | 2,147 | 3,885 | 4,175 | ||||||||||||
Total operating expenses | 15,243 | 10,384 | 27,543 | 20,360 | ||||||||||||
Loss from Operations | (5,236 | ) | (2,577 | ) | (9,841 | ) | (6,565 | ) | ||||||||
Other (income) expense: | ||||||||||||||||
Interest expense | 900 | 711 | 1,821 | 1,261 | ||||||||||||
Other expense (income), net | 1,360 | (420 | ) | 1,331 | (444 | ) | ||||||||||
Net Loss | $ | (7,496 | ) | $ | (2,868 | ) | $ | (12,993 | ) | $ | (7,382 | ) | ||||
Net loss per share of common stock outstanding, basic and diluted | $ | (30.60 | ) | $ | (16.58 | ) | $ | (55.29 | ) | $ | (43.42 | ) | ||||
Weighted-average common shares outstanding, basic and diluted | 245 | 173 | 235 | 170 | ||||||||||||
Balance Sheets
(Unaudited; In thousands, except per share data)
June 30, | December 31, | |||||||
2018 | 2017 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 14,544 | $ | 29,147 | ||||
Accounts receivable, net | 4,724 | 4,267 | ||||||
Inventory | 2,441 | 2,468 | ||||||
Prepaid expenses and other current assets | 4,292 | 1,123 | ||||||
Total current assets | 26,001 | 37,005 | ||||||
Property and equipment, net | 1,493 | 1,359 | ||||||
Other assets | 851 | 574 | ||||||
Total Assets | $ | 28,345 | $ | 38,938 | ||||
Liabilities, Convertible Preferred Stock and Stockholders' Deficit | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 2,928 | $ | 2,513 | ||||
Accrued expenses | 7,731 | 7,511 | ||||||
Deferred revenue | 1,686 | 1,970 | ||||||
Current portion of long-term debt | 2,500 | - | ||||||
Total current liabilities | 14,845 | 11,994 | ||||||
Long-term debt, net | 27,497 | 29,556 | ||||||
Deferred revenue | 2,124 | 2,275 | ||||||
Convertible preferred stock warrant liability | 1,893 | 478 | ||||||
Deferred rent | 121 | 151 | ||||||
Total Liabilities | 46,480 | 44,454 | ||||||
Convertible preferred stock, $0.01 par value: 308,593 shares authorized, | 187,136 | 187,136 | ||||||
issuable in series; 304,958 shares issued and outstanding at June 30, | ||||||||
2018 and December 31, 2017; aggregate liquidation value of $108,324 | ||||||||
at June 30, 2018 | ||||||||
Stockholders' deficit: | ||||||||
Preferred stock, $0.01 par value: no shares authorized, issued or | - | - | ||||||
outstanding at June 30, 2018 and December 31, 2017 | ||||||||
Common stock, $0.01 par value: 413,918 shares authorized; 257 and 231 | ||||||||
shares issued and outstanding at June 30, 2018 and December 31, 2017, | ||||||||
respectively | ||||||||
Additional paid-in capital | 3 | 2 | ||||||
Accumulated deficit | 4,665 | 4,292 | ||||||
Total Stockholder's Deficit | (209,939 | ) | (196,946 | ) | ||||
Total Liabilities, Convertible Preferred Stock and Stockholders' Deficit | (205,271 | ) | (192,652 | ) | ||||
$ | 28,345 | $ | 38,938 | |||||
Statements of Cash Flows
(Unaudited; In thousands)
Six Months ended June 30, | ||||||||
2018 | 2017 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net loss | $ | (12,993 | ) | $ | (7,382 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 463 | 307 | ||||||
Share-based compensation | 336 | 198 | ||||||
Non-cash interest expense | 441 | 285 | ||||||
Change in fair value of convertible preferred stock warrant liability | 1,415 | (411 | ) | |||||
Cost of rental units purchased by customers | 79 | 54 | ||||||
Changes in certain assets and liabilities: | ||||||||
Accounts receivable, net | (457 | ) | 37 | |||||
Inventory | (378 | ) | (569 | ) | ||||
Prepaid expenses and other assets | 380 | 152 | ||||||
Accounts payable | (89 | ) | (1,270 | ) | ||||
Accrued expenses | (2,130 | ) | (763 | ) | ||||
Deferred revenue | (435 | ) | (101 | ) | ||||
Deferred rent | (29 | ) | (18 | ) | ||||
Net Cash Used in Operating Activities | (13,397 | ) | (9,481 | ) | ||||
Cash Flows from Investing Activities: | ||||||||
Purchases of property and equipment and capitalized software | (513 | ) | (152 | ) | ||||
Net Cash Used in Investing Activities | (513 | ) | (152 | ) | ||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from issuance of Series G convertible preferred stock, net | - | 14,825 | ||||||
Payments of initial public offering costs | (731 | ) | - | |||||
Borrowings under credit facilities | - | 5,000 | ||||||
Payments of debt issuance costs | - | (1,015 | ) | |||||
Proceeds from exercises of stock options | 38 | 16 | ||||||
Net Cash (Used in) Provided by Financing Activities | (693 | ) | 18,826 | |||||
Net (Decrease) Increase in Cash and Cash Equivalents | (14,603 | ) | 9,193 | |||||
Cash and Cash Equivalents, Beginning of Period | 29,147 | 17,040 | ||||||
Cash and Cash Equivalents, End of Period | $ | 14,544 | $ | 26,233 | ||||
Non-GAAP Measures
EBITDA is not a measure of financial performance under generally accepted accounting principles (GAAP) and should not be construed as a substitute for, or superior to, GAAP net loss. However, management uses both the GAAP and non-GAAP financial measures internally to evaluate and manage the Company’s operations and to better understand its business. Further, management believes the addition of the non-GAAP financial measure provides meaningful supplementary information to, and facilitates analysis by, investors in evaluating the Company’s financial performance, results of operations and trends. The Company’s calculation of EBITDA may not be comparable to similarly designated measures reported by other companies, since companies and investors may differ as to what type of events warrant adjustment.
The following table reconciles reported net loss to EBITDA:
Three Months ended June 30, | ||||||||
2018 | 2017 | |||||||
EBITDA Reconciliation | (in thousands) | |||||||
Net Loss | $ | (7,496 | ) | $ | (2,868 | ) | ||
Interest expense | 900 | 711 | ||||||
Income taxes | - | - | ||||||
Depreciation and amortization | 324 | 142 | ||||||
EBITDA | $ | (6,272 | ) | $ | (2,015 | ) | ||