LAWRENCE, Mass., Aug. 4,
2016 /PRNewswire/ -- NxStage Medical, Inc. (Nasdaq: NXTM), a
leading medical technology company focused on advancing renal care,
today reported second quarter revenue above the top end of its
guidance.
Total revenue for the second quarter of 2016 increased 15
percent to $92.2 million, compared
with revenue of $80.3 million for the
second quarter of 2015. The Company's revenue guidance range for
the second quarter was $89.0 million to
$91.0 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
$51.1 million for the second quarter
of 2016 compared with revenue of $44.8
million for the second quarter of 2015. Critical Care
revenue increased 28 percent to $18.7
million for the second quarter of 2016 compared with revenue
of $14.6 million for the second
quarter of 2015.
Net loss attributable to NxStage Medical, Inc.'s stockholders
improved to $1.7 million for the
second quarter of 2016 compared with a net loss of $5.3 million for the second quarter of 2015 and
included $5.0 million of income from
operations from the Products Business.
"We delivered another strong quarter of growth and improving
profitability. Looking ahead, we believe we are well positioned
with tremendous growth opportunities which include an impressive
stream of system launches expected over the next three years: our
next generation hemodialysis system, our peritoneal dialysis system
and our next generation critical care system," stated Jeffrey H. Burbank, Founder and CEO of
NxStage.
The Company also announced that it launched enhanced priming
features, the first of many upcoming capabilities of its next
generation hemodialysis system. "The NxStage team is thrilled to
provide patients and customers with access to new enhanced priming
features that deliver on our promise of improved ease of use and
reduced set-up time. In addition, these features are compatible
with current generation System Ones, which means patients and
customers can easily access them today," stated Burbank.
Guidance:
The Company now expects full-year revenue
for 2016 to be in the range of $360 to $365 million, versus its previously increased
guidance for revenue to be at the high end of its range
of $355 to $360 million,
reflecting Critical Care's outperformance during the quarter.
The Company now expects its net loss for the full-year to be at the
better end of its guidance range of $7 to $12 million.
For the third quarter of 2016, the Company expects revenue to be
in the range of $89 to $91
million, which reflects expectations for lower revenue from
the Company's In-Center segment as previously disclosed earlier
this year. The Company also expects 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, Thursday, August 4, 2016, at 9:00 a.m. Eastern Time to discuss its second
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 August 11, 2016. To access the replay, dial
855-859-2056 (domestic) or 404-537-3406 (international) and
reference conference ID 44443371. 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 13 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 Quarterly Report
on Form 10-Q for the quarter ended March 31,
2016.
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 June 30,
|
|
Six Months
Ended June 30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
|
|
|
|
|
Revenues
|
$
|
92,207
|
|
$
|
80,316
|
|
$
|
181,414
|
|
$
|
159,798
|
Cost of
revenues
|
53,784
|
|
49,452
|
|
106,474
|
|
98,808
|
Gross
profit
|
38,423
|
|
30,864
|
|
74,940
|
|
60,990
|
Operating
expenses:
|
|
|
|
|
|
|
|
Selling and
marketing
|
16,116
|
|
14,518
|
|
31,370
|
|
29,066
|
Research and
development
|
7,961
|
|
6,622
|
|
15,115
|
|
12,496
|
Distribution
|
7,015
|
|
6,255
|
|
14,068
|
|
12,626
|
General and
administrative
|
8,511
|
|
8,585
|
|
16,542
|
|
17,497
|
Total operating
expenses
|
39,603
|
|
35,980
|
|
77,095
|
|
71,685
|
Loss from
operations
|
(1,180)
|
|
(5,116)
|
|
(2,155)
|
|
(10,695)
|
Other income
(expense):
|
|
|
|
|
|
|
|
Interest expense,
net
|
(288)
|
|
(242)
|
|
(529)
|
|
(483)
|
Other (expense)
income, net
|
(409)
|
|
37
|
|
(641)
|
|
301
|
Total other
expense
|
(697)
|
|
(205)
|
|
(1,170)
|
|
(182)
|
Net loss before
income taxes
|
(1,877)
|
|
(5,321)
|
|
(3,325)
|
|
(10,877)
|
Provision for income
taxes
|
348
|
|
273
|
|
683
|
|
580
|
Net loss
|
(2,225)
|
|
(5,594)
|
|
(4,008)
|
|
(11,457)
|
Less: Net loss
attributable to noncontrolling interests
|
(493)
|
|
(267)
|
|
(1,000)
|
|
(472)
|
Net loss attributable
to stockholders of NxStage Medical, Inc.
|
$
|
(1,732)
|
|
$
|
(5,327)
|
|
$
|
(3,008)
|
|
$
|
(10,985)
|
Net loss per share,
basic and diluted
|
$
|
(0.03)
|
|
$
|
(0.08)
|
|
$
|
(0.05)
|
|
$
|
(0.17)
|
Weighted-average
shares outstanding, basic and diluted
|
64,428
|
|
63,288
|
|
64,302
|
|
63,059
|
Other comprehensive
loss, net of tax
|
(1,280)
|
|
(154)
|
|
(219)
|
|
(930)
|
Total comprehensive
loss
|
(3,505)
|
|
(5,748)
|
|
(4,227)
|
|
(12,387)
|
Less: Comprehensive
loss attributable to noncontrolling interests
|
(493)
|
|
(267)
|
|
(1,000)
|
|
(472)
|
Total comprehensive
loss attributable to stockholders of NxStage Medical,
Inc.
|
$
|
(3,012)
|
|
$
|
(5,481)
|
|
$
|
(3,227)
|
|
$
|
(11,915)
|
NxStage Medical,
Inc.
Condensed
Consolidated Balance Sheets
(in thousands,
except share data)
(unaudited)
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
2016
|
|
2015
|
|
|
|
ASSETS
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$
|
58,459
|
|
$
|
59,065
|
Accounts receivable,
net
|
30,092
|
|
25,195
|
Inventory
|
41,309
|
|
38,391
|
Prepaid expenses and
other current assets
|
5,921
|
|
6,254
|
Total current
assets
|
135,781
|
|
128,905
|
Property and
equipment, net
|
66,374
|
|
66,711
|
Field equipment,
net
|
20,978
|
|
20,744
|
Deferred cost of
revenues
|
34,065
|
|
33,068
|
Intangible assets,
net
|
10,714
|
|
11,744
|
Goodwill
|
42,710
|
|
42,710
|
Other
assets
|
3,074
|
|
2,992
|
Total
assets
|
$
|
313,696
|
|
$
|
306,874
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$
|
13,583
|
|
$
|
10,767
|
Accrued
expenses
|
26,616
|
|
27,266
|
Current portion of
long-term debt
|
324
|
|
315
|
Other current
liabilities
|
4,452
|
|
4,394
|
Total current
liabilities
|
44,975
|
|
42,742
|
Deferred
revenues
|
52,280
|
|
51,362
|
Long-term
debt
|
1,602
|
|
1,664
|
Other long-term
liabilities
|
16,911
|
|
17,367
|
Total
liabilities
|
115,768
|
|
113,135
|
Commitments and
contingencies
|
|
|
Noncontrolling
interests subject to put provisions
|
168
|
|
219
|
Stockholders'
equity:
|
|
|
Undesignated
preferred stock: par value $0.001, 5,000,000 shares
authorized;
no shares issued and outstanding as of June 30, 2016 and December
31, 2015
|
—
|
|
—
|
Common stock: par
value $0.001, 100,000,000 shares authorized; 65,443,862 and
64,873,038 shares issued as of June 30, 2016 and December 31, 2015,
respectively
|
65
|
|
64
|
Additional paid-in
capital
|
621,395
|
|
612,487
|
Accumulated
deficit
|
(405,838)
|
|
(402,830)
|
Accumulated other
comprehensive loss
|
(4,250)
|
|
(4,031)
|
Treasury stock, at
cost: 901,013 and 822,059 shares as of June 30, 2016 and
December 31, 2015, respectively
|
(15,334)
|
|
(13,864)
|
Total NxStage
Medical, Inc. stockholders' equity
|
196,038
|
|
191,826
|
Noncontrolling
interests not subject to put provisions
|
1,722
|
|
1,694
|
Total stockholders'
equity
|
197,760
|
|
193,520
|
Total liabilities and
stockholders' equity
|
$
|
313,696
|
|
$
|
306,874
|
|
|
|
NxStage Medical,
Inc.
Cash Flows from
Operating Activities
(in
thousands)
(unaudited)
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30,
|
|
2016
|
|
2015
|
|
|
|
|
Cash flows from
operating activities:
|
|
|
|
Net loss
|
$
|
(4,008)
|
|
$
|
(11,457)
|
Adjustments to
reconcile net loss to net cash provided by
(used in) operating activities:
|
|
|
|
Depreciation and
amortization
|
15,649
|
|
15,473
|
Stock-based
compensation
|
5,394
|
|
6,590
|
Other
|
(561)
|
|
813
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts
receivable
|
(4,980)
|
|
(2,315)
|
Inventory
|
(12,533)
|
|
(8,023)
|
Prepaid expenses and
other assets
|
150
|
|
169
|
Accounts
payable
|
2,785
|
|
(641)
|
Accrued expenses and
other liabilities
|
276
|
|
(2,036)
|
Deferred
revenues
|
991
|
|
(957)
|
Net cash provided by
(used in) operating activities
|
$
|
3,163
|
|
$
|
(2,384)
|
NxStage Medical,
Inc.
Revenues by
Segment
(in
thousands)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
System One
segment
|
|
|
|
|
|
|
|
Home
|
$
|
51,102
|
|
$
|
44,789
|
|
$
|
100,638
|
|
$
|
88,287
|
Critical
Care
|
18,745
|
|
14,631
|
|
38,512
|
|
30,713
|
Total System One
segment
|
69,847
|
|
59,420
|
|
139,150
|
|
119,000
|
In-Center
segment
|
16,731
|
|
18,563
|
|
33,497
|
|
36,430
|
Other
|
3,408
|
|
1,857
|
|
5,589
|
|
3,704
|
Products
subtotal
|
89,986
|
|
79,840
|
|
178,236
|
|
159,134
|
Services
segment
|
4,114
|
|
1,144
|
|
6,801
|
|
1,814
|
Elimination of
intersegment revenues
|
(1,893)
|
|
(668)
|
|
(3,623)
|
|
(1,150)
|
Total
|
$
|
92,207
|
|
$
|
80,316
|
|
$
|
181,414
|
|
$
|
159,798
|
NxStage Medical,
Inc.
Segment Financial
Performance
(in
thousands)
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Products Business
(System One Segment,
In-Center Segment & Other)
|
|
|
|
|
|
|
|
Revenues
|
$
|
89,986
|
|
|
$
|
79,840
|
|
|
$
|
178,236
|
|
|
$
|
159,134
|
|
Gross
profit
|
$
|
42,097
|
|
|
$
|
34,781
|
|
|
$
|
83,433
|
|
|
$
|
68,487
|
|
Gross margin
percentage
|
47
|
%
|
|
44
|
%
|
|
47
|
%
|
|
43
|
%
|
Income from
operations
|
$
|
4,989
|
|
|
$
|
955
|
|
|
$
|
11,205
|
|
|
$
|
1,158
|
|
Services
|
|
|
|
|
|
|
|
Revenues
|
$
|
4,114
|
|
|
$
|
1,144
|
|
|
$
|
6,801
|
|
|
$
|
1,814
|
|
Gross
profit
|
$
|
(3,454)
|
|
|
$
|
(3,917)
|
|
|
$
|
(8,103)
|
|
|
$
|
(7,497)
|
|
Gross margin
percentage
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
Loss from
operations
|
$
|
(5,949)
|
|
|
$
|
(6,071)
|
|
|
$
|
(12,970)
|
|
|
$
|
(11,853)
|
|
Eliminations
|
|
|
|
|
|
|
|
Elimination of
intersegment revenues
|
$
|
(1,893)
|
|
|
$
|
(668)
|
|
|
$
|
(3,623)
|
|
|
$
|
(1,150)
|
|
Elimination of
intersegment gross profit
|
$
|
(220)
|
|
|
$
|
—
|
|
|
$
|
(390)
|
|
|
$
|
—
|
|
Total
Company
|
|
|
|
|
|
|
|
Revenues
|
$
|
92,207
|
|
|
$
|
80,316
|
|
|
$
|
181,414
|
|
|
$
|
159,798
|
|
Gross
profit
|
$
|
38,423
|
|
|
$
|
30,864
|
|
|
$
|
74,940
|
|
|
$
|
60,990
|
|
Gross margin
percentage
|
42
|
%
|
|
38
|
%
|
|
41
|
%
|
|
38
|
%
|
Loss from
operations
|
$
|
(1,180)
|
|
|
$
|
(5,116)
|
|
|
$
|
(2,155)
|
|
|
$
|
(10,695)
|
|
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SOURCE NxStage Medical, Inc.