LAWRENCE, Mass., May 4,
2016 /PRNewswire/ -- NxStage Medical, Inc. (Nasdaq: NXTM), a
leading medical technology company focused on advancing renal care,
today reported first quarter financial results above the top end of
its guidance.
Total revenue for the first quarter of 2016 increased 12 percent
to $89.2 million, compared with
revenue of $79.5 million for the
first quarter of 2015. The Company's revenue guidance range for the
first quarter was $87 to $89
million.
The Company's revenue performance was driven by the Products
Business, and more specifically, outperformance in NxStage's
largest segment, System One, which consists of its Home and
Critical Care markets. Home revenue increased 14 percent to
$49.5 million for the first quarter
of 2016 compared with revenue of $43.5
million for the first quarter of 2015. Critical Care revenue
increased 23 percent to $19.8 million
for the first quarter of 2016 compared with revenue of $16.1 million for the first quarter of 2015.
Net loss attributable to NxStage Medical, Inc.'s stockholders
improved to $1.3 million for the
first quarter of 2016 compared with a net loss of $5.7 million for the first quarter of 2015. The
net loss for the first quarter of 2016 was better than its guidance
for a net loss of $2 to $4 million and included $6.2 million of income from operations from the
Products Business.
"This is an exciting time for NxStage. Our focus on innovation
and execution is clearly driving the results we expected," stated
Jeffrey H. Burbank, Founder and CEO
of NxStage Medical. "Our Products Business, in particular, is
firing on all cylinders and making phenomenal progress across the
P&L with strong and improving gross margins and increasing
profitability. This provides us with increasing confidence around
our target of total company profitability in 2017."
Burbank continued, "We're confident we can continue this
momentum and achieve our target of 15% annual revenue growth for
the Home in 2016. We're also moving our revenue guidance for
2016 up to the higher end of our previous range as a result of our
strong start within Critical Care. Beyond 2016, we believe
that we have one of the industry's most robust product pipelines on
tap that can help take us from our current $1 billion market opportunity to a $5 billion opportunity and drive further P&L
performance. When you combine all the elements, it adds up to a
very compelling long-term model and puts us in a position to
deliver significant shareholder value each year."
Guidance:
The Company now expects full-year revenue for 2016 to be at the
high end of its previous guidance range of $355 to $360 million with unchanged guidance
for a net loss in the range of $7 to $12
million.
For the second quarter of 2016, the Company expects revenue to
be in a range of $89 to $91
million, and a net loss in the range
of $1 to $3 million. The Company's net loss guidance
reflects expectations for continued operating income from the
Products Business offset by the Company's continued investment in
NxStage Kidney Care.
Conference Call:
NxStage will also host a conference
call today, Wednesday, May 4, 2016, at 9:00 a.m. Eastern Time to discuss its first
quarter financial results. To listen to the conference call, please
dial 877-392-9886 (domestic) or 707-287-9329 (international). The
call will also be webcast LIVE and can be accessed via the investor
relations section of the Company's website at
http://ir.nxstage.com.
A replay of the conference call will be available two hours
after the completion of the call through May
11, 2016. To access the replay, dial 855-859-2056 (domestic)
or 404-537-3406 (international) and reference conference ID
87420544. An online archive of the conference call can be accessed
via the investor relations section of the Company's website at
http://ir.nxstage.com.
About NxStage
NxStage Medical, Inc. (Nasdaq: NXTM) is
a leading medical technology company, headquartered in Lawrence, Massachusetts, USA, that develops,
manufactures and markets innovative products for the treatment of
end-stage renal disease (ESRD) and acute kidney failure. NxStage
has also established a small number of dialysis clinics committed
to the development of innovative care delivery models for patients
with ESRD. For more information on NxStage and its products and
services, please visit the Company's website at
http://www.nxstage.com and www.nxstagekidneycare.com.
About the NxStage System One
The NxStage System One is
the first and only truly portable hemodialysis system cleared
specifically by the FDA for home hemodialysis and home nocturnal
hemodialysis. Its simplicity and revolutionary size (just over a
foot tall) are intended to allow convenient use in patients' homes
and give patients the freedom to travel with their therapy. When
combined with the NxStage PureFlow SL Dialysis Preparation System,
patients are able to further simplify, using ordinary tap water to
create dialysis fluid on demand. Unlike conventional hemodialysis
systems, the System One requires no special infrastructure to
operate. Under the guidance of their physician, patients can use
the NxStage System One, with their trained partners, where, how and
when it best meets their needs, including while they are sleeping -
at home or on vacation and at a medically appropriate treatment
frequency. In addition, NxStage's Nx2Me Connected Health platform
collects important NxStage System One and patient information for
flexible viewing, monitoring and reporting that may improve patient
management and simplify alternative site care. The System One is
also used to provide a range of flexible therapy options in more
traditional care settings such as hospitals and dialysis centers.
Its safety and efficacy have been demonstrated by experience with
more than 12 million treatments with thousands of patients around
the world. http://www.nxstage.com/.
This release contains forward-looking statements concerning our
business, operations and financial condition. All statements
contained in this release that are not clearly historical in nature
are forward-looking, and the words "anticipate," "believe,"
"expect," "estimate," "plan," and similar expressions are generally
intended to identify forward-looking statements. Examples of these
forward-looking statements include statements as to the anticipated
demand for the Company's products, market opportunities, timing of
our new product launches, and our financial guidance for 2016 and
beyond, including anticipated revenues and net loss. All
forward-looking statements involve risks, uncertainties and
contingencies, many of which are beyond NxStage's control, which
may cause actual results, performance, or achievements to differ
materially from anticipated results, performance or achievements,
including market acceptance and demand for NxStage's products
domestically and internationally, growth in home and/or more
frequent hemodialysis, regulatory approvals, competition,
unanticipated difficulties in achieving operational efficiencies
and cost reductions, changes in reimbursement for home and more
frequent hemodialysis, changes in the regulatory environment,
changes in the historical purchasing patterns and preferences of
our customers, including DaVita Healthcare Partners Inc. and
Fresenius Medical Care, including in response to NxStage Kidney
Care, and certain other factors that may affect future operating
results and which are detailed in NxStage's filings with the
Securities and Exchange Commission, including its Annual Report on
Form 10-K for the year ended December 31, 2015.
In addition, the statements in this press release represent
NxStage's expectations and beliefs as of the date of this press
release. NxStage anticipates that subsequent events and
developments may cause these expectations and beliefs to change.
However, while NxStage may elect to update these forward-looking
statements at some point in the future, it specifically disclaims
any obligation to do so, whether as a result of new information,
future events, or otherwise. These forward-looking statements
should not be relied upon as representing NxStage's expectations or
beliefs as of any date subsequent to the date of this press
release.
|
Contact:
|
|
Kristen K. Sheppard,
Esq.
|
|
VP, Investor
Relations
|
|
ksheppard@nxstage.com
|
|
NxStage Medical,
Inc.
Condensed
Consolidated Statements of Comprehensive Loss
(in thousands,
except per share data)
(unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
|
|
|
|
Revenues
|
$
|
89,207
|
|
$
|
79,482
|
|
Cost of
revenues
|
52,690
|
|
49,356
|
|
Gross
profit
|
36,517
|
|
30,126
|
|
Operating
expenses:
|
|
|
|
|
Selling and
marketing
|
15,254
|
|
14,548
|
|
Research and
development
|
7,154
|
|
5,874
|
|
Distribution
|
7,053
|
|
6,371
|
|
General and
administrative
|
8,031
|
|
8,912
|
|
Total operating
expenses
|
37,492
|
|
35,705
|
|
Loss from
operations
|
(975)
|
|
(5,579)
|
|
Other income
(expense):
|
|
|
|
|
Interest expense,
net
|
(241)
|
|
(241)
|
|
Other (expense)
income, net
|
(232)
|
|
264
|
|
Total other
expense
|
(473)
|
|
23
|
|
Net loss before
income taxes
|
(1,448)
|
|
(5,556)
|
|
Provision for income
taxes
|
335
|
|
307
|
|
Net loss
|
(1,783)
|
|
(5,863)
|
|
Less: Net loss
attributable to noncontrolling interests
|
(507)
|
|
(205)
|
|
Net loss attributable
to stockholders of NxStage Medical, Inc.
|
$
|
(1,276)
|
|
$
|
(5,658)
|
|
|
|
|
|
Net loss per share,
basic and diluted
|
$
|
(0.02)
|
|
$
|
(0.09)
|
|
Weighted-average
shares outstanding, basic and diluted
|
64,179
|
|
62,836
|
|
|
|
|
|
Other comprehensive
gain (loss), net of tax
|
1,061
|
|
(776)
|
|
Total comprehensive
loss
|
(722)
|
|
(6,639)
|
|
Less: Comprehensive
loss attributable to noncontrolling interests
|
(507)
|
|
(205)
|
|
Total comprehensive
loss attributable to stockholders of NxStage Medical,
Inc.
|
$
|
(215)
|
|
$
|
(6,434)
|
|
NxStage Medical,
Inc.
Condensed
Consolidated Balance Sheets
(in thousands,
except share data)
(unaudited)
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
2016
|
|
2015
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
|
57,714
|
|
$
|
59,065
|
|
Accounts receivable,
net
|
29,083
|
|
25,195
|
|
Inventory
|
39,034
|
|
38,391
|
|
Prepaid expenses and
other current assets
|
5,891
|
|
6,254
|
|
Total current
assets
|
131,722
|
|
128,905
|
|
Property and
equipment, net
|
68,008
|
|
66,711
|
|
Field equipment,
net
|
20,385
|
|
20,744
|
|
Deferred cost of
revenues
|
33,995
|
|
33,068
|
|
Intangible assets,
net
|
11,231
|
|
11,744
|
|
Goodwill
|
42,710
|
|
42,710
|
|
Other
assets
|
2,898
|
|
2,992
|
|
Total
assets
|
$
|
310,949
|
|
$
|
306,874
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
|
14,104
|
|
$
|
10,767
|
|
Accrued
expenses
|
24,346
|
|
27,266
|
|
Current portion of
long-term debt
|
322
|
|
315
|
|
Other current
liabilities
|
4,530
|
|
4,394
|
|
Total current
liabilities
|
43,302
|
|
42,742
|
|
Deferred
revenues
|
52,521
|
|
51,362
|
|
Long-term
debt
|
1,617
|
|
1,664
|
|
Other long-term
liabilities
|
17,616
|
|
17,367
|
|
Total
liabilities
|
115,056
|
|
113,135
|
|
Commitments and
contingencies
|
|
|
|
|
Noncontrolling
interests subject to put provisions
|
205
|
|
219
|
|
Stockholders'
equity:
|
|
|
|
|
Undesignated
preferred stock: par value $0.001, 5,000,000 shares
authorized;
no shares issued and outstanding as of March 31, 2016 and December
31, 2015
|
—
|
|
—
|
|
Common stock: par
value $0.001, 100,000,000 shares authorized; 65,205,174 and
64,873,038 shares issued as of March 31, 2016 and December 31,
2015, respectively
|
65
|
|
64
|
|
Additional paid-in
capital
|
615,105
|
|
612,487
|
|
Accumulated
deficit
|
(404,106)
|
|
(402,830)
|
|
Accumulated other
comprehensive loss
|
(2,970)
|
|
(4,031)
|
|
Treasury stock, at
cost: 825,074 and 822,059 shares as of March 31, 2016 and
December 31, 2015, respectively
|
(13,906)
|
|
(13,864)
|
|
Total NxStage
Medical, Inc. stockholders' equity
|
194,188
|
|
191,826
|
|
Noncontrolling
interests not subject to put provisions
|
1,500
|
|
1,694
|
|
Total stockholders'
equity
|
195,688
|
|
193,520
|
|
Total liabilities and
stockholders' equity
|
$
|
310,949
|
|
$
|
306,874
|
|
|
|
|
|
NxStage Medical,
Inc.
Cash Flows from
Operating Activities
(in
thousands)
(unaudited)
|
|
|
|
|
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
|
Net loss
|
$
|
(1,783)
|
|
$
|
(5,863)
|
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
Depreciation and
amortization
|
7,736
|
|
7,680
|
|
Stock-based
compensation
|
2,614
|
|
3,727
|
|
Other
|
(37)
|
|
508
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
(3,849)
|
|
2
|
|
Inventory
|
(5,480)
|
|
(5,688)
|
|
Prepaid expenses and
other assets
|
681
|
|
81
|
|
Accounts
payable
|
3,184
|
|
3,650
|
|
Accrued expenses and
other liabilities
|
(1,553)
|
|
(3,158)
|
|
Deferred
revenues
|
979
|
|
(523)
|
|
Net cash provided by
operating activities
|
$
|
2,492
|
|
$
|
416
|
|
NxStage Medical,
Inc.
Revenues by
Segment
(in
thousands)
(unaudited)
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
System One
segment
|
|
|
|
|
Home
|
$
|
49,536
|
|
|
$
|
43,498
|
|
|
Critical
Care
|
19,767
|
|
|
16,082
|
|
|
Total System One
segment
|
69,303
|
|
|
59,580
|
|
|
In-Center
segment
|
16,766
|
|
|
17,867
|
|
|
Other
|
2,181
|
|
|
1,847
|
|
|
Products
subtotal
|
88,250
|
|
|
79,294
|
|
|
Services
segment
|
2,687
|
|
|
670
|
|
|
Elimination of
intersegment revenues
|
(1,730)
|
|
|
(482)
|
|
|
Total
|
$
|
89,207
|
|
|
$
|
79,482
|
|
|
NxStage Medical,
Inc.
Segment Financial
Performance
(in
thousands)
(unaudited)
|
|
|
|
Three Months
Ended
March 31,
|
|
2016
|
|
2015
|
|
Products Business
(System One Segment, In-Center Segment & Other)
|
|
|
|
|
Revenues
|
$
|
88,250
|
|
|
$
|
79,294
|
|
|
Gross
profit
|
$
|
41,336
|
|
|
$
|
33,706
|
|
|
Gross margin
percentage
|
47
|
%
|
|
43
|
%
|
|
Income from
operations
|
$
|
6,216
|
|
|
$
|
203
|
|
|
Services
|
|
|
|
|
Revenues
|
$
|
2,687
|
|
|
$
|
670
|
|
|
Gross
profit
|
$
|
(4,649)
|
|
|
$
|
(3,580)
|
|
|
Gross margin
percentage
|
n/a
|
|
|
n/a
|
|
|
Loss from
operations
|
$
|
(7,021)
|
|
|
$
|
(5,782)
|
|
|
Eliminations
|
|
|
|
|
Elimination of
intersegment revenues
|
$
|
(1,730)
|
|
|
$
|
(482)
|
|
|
Elimination of
intersegment gross profit
|
$
|
(170)
|
|
|
$
|
—
|
|
|
Total
Company
|
|
|
|
|
Revenues
|
$
|
89,207
|
|
|
$
|
79,482
|
|
|
Gross
profit
|
$
|
36,517
|
|
|
$
|
30,126
|
|
|
Gross margin
percentage
|
41
|
%
|
|
38
|
%
|
|
Loss from
operations
|
$
|
(975)
|
|
|
$
|
(5,579)
|
|
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SOURCE NxStage Medical, Inc.