BOSTON, Nov. 10, 2016 /PRNewswire/ -- DarioHealth
Corp. (NASDAQ: DRIO), developer of the Dario™ Blood Glucose
Monitoring System, today reported financial and operational results
for the three and nine month periods ended September 30, 2016.
Third Quarter 2016 Highlights
- Record revenues of $728,000,
increased 166% compared to the third quarter of 2015
- Gross profit of $76,000 in the
third quarter
- 75% of quarterly revenues derived from test strips and other
consumables
- More than 5,500 Dario all-in-one smart glucose meter devices
were purchased directly by U.S. customers during the third quarter;
globally about 8,500 were sold during the quarter
- About 70% of strips sales in the U.S. during the quarter were
under the subscription plan
- Direct-to-consumer model launched in Australia and in Canada
- Ramped up inventory to $1.1
million in order to support further market penetration
"During the third quarter, we continued to advance our
direct-to-consumer strategy in the U.S., increased device sales,
delivered significant monthly user growth and established a
predictable stream of high margin recurring subscription revenues
from new customers," said Erez
Raphael, DarioHealth's Chief Executive Officer. "We are
encouraged by the positive engagement we are achieving with new
users and expect market penetration and user growth to accelerate
in the fourth quarter and in 2016."
"Our active community of users and subscribers is growing every
day which is bringing positive changes to people with diabetes, and
disrupting the digital, mHealth and lifestyle market," Mr. Raphael
concluded. "We have the right product and the right strategy to
succeed in these efforts and look forward to the opportunities
ahead of us. The predictable nature of these subscription revenues
will provide us greater visibility in 2017 and serve as the
foundation for our long-term growth."
In July, DarioHealth expanded its direct-to-consumer strategy in
Australia, via its local sponsor
IBD Consulting. This change in business model in Australia from utilizing distributors to a
direct-to-consumer model resulted in minimal revenue contribution
from Australia during the third
quarter but Australia revenue
contribution is expected to resume. The company is offering
consumers the ability to purchase the Dario all-in-one smart
glucose meter directly online at the website:
http://mydario.net.au. In Australia the device can be used
either on iPhone and / or common Android devices and the free App
also supports special features such as estimated HbA1C levels which
the company believes may enable diabetes management in a more
proactive way and enable faster and wider penetration in
Australia.
In September, DarioHealth also launched an online store in
Canada. The online store was
launched in collaboration with A&D Medical, a global leader in
connected health and biometric measurement devices and services,
and Bayshore Specialty Rx Ltd.'s online pharmacy, Diabetes
Express.
Third Quarter 2016 Summary
Revenue for the third
quarter of 2016 was $728,000, a 166%
increase from $273,000 in third
quarter of 2015 and a 9% increase sequentially from the second
quarter of 2016.
Revenues for the third quarter of 2016 include
direct-to-consumer sales in the United
States, as well as partial quarter direct-to-consumer sales
and sales to business partners in Australia, and product sales to distributors
in the United States, United Kingdom, Italy, Canada, New
Zealand and Israel with
respect to DarioHealth's patient management software
platform. The change in the business model to
direct-to–consumer in Australia
resulted in minimal revenue contribution from Australia during the third quarter.
Gross profit of $76,000 was
recorded in the third quarter of 2016, an increase of $207,000, as compared to a gross loss of
$131,000 in the third quarter of
2016. The increase in the gross profit recorded in the third
quarter of 2016 is a result of the higher level of sales and the
fact that the Company's Dario device is sold at a higher average
sale prices.
Operating loss for the third quarter of 2016 increased by
$174,000 to $2.7 million, as compared to a $2.5 million operating loss in the third quarter
of 2015. This increase is mainly due to increased costs related to
our direct sales and marketing efforts in the United States.
Net loss attributable to holders of common stock decreased by
$88,000 to $1.7 million in the third quarter of 2016, as
compared to $1.8 million in the third
quarter of 2015.
As of September 30, 2016, cash and
cash equivalents totaled $3.3
million, compared to $2.7
million at the end of 2015.
Year to Date Results
For the nine months ended
September 30, 2016, revenues were
$1,965,000, a 281% increase from
$515,000 for the nine months ended
September 30, 2015.
Gross loss improved by $413,000 to
a loss of $183,000 in the nine months
ended September 30, 2016, as compared
to a $596,000 gross loss in the nine
months ended September 30, 2015.
Operating loss for the nine months ended September 30, 2016 increased by $1.4 million to $7.3
million, as compared to a $5.8
million operating loss in the nine months ended September 30, 2015.
Net loss attributable to holders of common stock increased by
$179,000 to $5.6 million in the nine months ended
September 30, 2016, as compared to
$5.5 million in the nine months ended
September 30, 2015.
About DarioHealth
DarioHealth is a leader in digital health self-management
solutions. DarioHealth delivers the ability to combine and analyze
consumer health data to personalize treatment and advance medical
knowledge. The Dario™ Blood Glucose Monitoring System is a platform
for diabetes management that combines an all-in-one blood glucose
meter, native smart phone app, website portal and a wide variety of
treatment tools to support more proactive and better informed
decisions by users living with diabetes, their doctors and
healthcare systems. Having recently launched in the largest
market in the world for glucose monitoring, U.S. sales are expected
to have a significant impact on revenues and gross margins. With
marketing clearance in Europe and
the U.S., the Dario iOS mobile app recently launched with
reimbursement in the United
Kingdom, Australia,
Israel, Italy, and Canada, and has also launched in New Zealand, Netherlands, Italy, and Belgium. For more
information, visit http://mydario.investorroom.com/
Cautionary Note Regarding Forward-Looking Statements
This news release and the statements of representatives and
partners of DarioHealth Corp. (the "Company") related thereto
contain or may contain forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.
Statements that are not statements of historical fact may be deemed
to be forward-looking statements. Without limiting the generality
of the foregoing, words such as "plan," "project," "potential,"
"seek," "may," "will," "expect," "believe," "anticipate," "intend,"
"could," "estimate" or "continue" are intended to identify
forward-looking statements. For example, the Company is using
forward-looking statements in this press release when the Company
describes its growth prospects, says that it expects market
penetration and user growth to accelerate in the fourth quarter and
in 2017, that Australia revenues
are expected to resume, that the Company's product and its features
may enable faster and wider penetration of the Australia market, and that U.S. sales are
expected to have a significant impact on revenues and gross
margins. Readers are cautioned that certain important factors
may affect the Company's actual results and could cause such
results to differ materially from any forward-looking statements
that may be made in this news release. Factors that may affect the
Company's results include, but are not limited to, regulatory
approvals, product demand, market acceptance, impact of competitive
products and prices, product development, commercialization or
technological difficulties, the success or failure of negotiations
and trade, legal, social and economic risks, and the risks
associated with the adequacy of existing cash resources. Additional
factors that could cause or contribute to differences between the
Company's actual results and forward-looking statements include,
but are not limited to, those risks discussed in the Company's
filings with the U.S. Securities and Exchange Commission. Readers
are cautioned that actual results (including, without limitation,
the timing for and results of the Company's commercial and
regulatory plans for Dario™ as described herein) may differ
significantly from those set forth in the forward-looking
statements. The Company undertakes no obligation to publicly update
any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
applicable law.
DARIOHEALTH
CORP.
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
U.S. dollars in
thousands
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
|
Unaudited
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
CURRENT
ASSETS:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
3,339
|
|
$
2,671
|
Short-term bank
deposits
|
|
229
|
|
80
|
Trade
receivables
|
|
259
|
|
-
|
Inventories
|
|
1,118
|
|
601
|
Other accounts
receivable and prepaid expenses
|
|
610
|
|
935
|
|
|
|
|
|
Total current
assets
|
|
5,555
|
|
4,287
|
|
|
|
|
|
LEASE
DEPOSITS
|
|
36
|
|
41
|
|
|
|
|
|
PROPERTY AND
EQUIPMENT, NET
|
|
1,105
|
|
749
|
|
|
|
|
|
Total
assets
|
|
$
6,696
|
|
$
5,077
|
DARIOHEALTH
CORP.
|
|
|
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
U.S. dollars in
thousands (except stock and stock data)
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
|
2016
|
|
2015
|
|
|
Unaudited
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY (DEFICIENCY)
|
|
|
|
|
CURRENT
LIABILITIES:
|
|
|
|
|
Trade
payables
|
|
$
1,027
|
|
$
978
|
Deferred
revenues
|
|
-
|
|
31
|
Other accounts payable
and accrued expenses
|
|
1,014
|
|
681
|
Total current
liabilities
|
|
2,041
|
|
1,690
|
LIABILITY RELATED TO
WARRANTS
|
|
295
|
|
2,610
|
COMMITMENTS AND
CONTINGENT LIABILITIES
|
|
|
|
|
CONVERTIBLE PREFERRED
SHARES:
|
|
|
|
|
Series A Preferred
Stock of $0.0001 par value - Authorized: 60,000 shares at September 30, 2016
(unaudited) and December 31, 2015; Issued and Outstanding: None and
1,984 shares at September 30, 2016 (unaudited) and December 31,
2015, respectively; Aggregate liquidation preference of none and
$3,560 at September 30, 2016 (unaudited) and December 31, 2015,
respectively
|
|
-
|
|
2,357
|
STOCKHOLDERS' EQUITY
(DEFICIENCY)
|
|
|
|
|
Common Stock of
$0.0001 par value -
Authorized:
160,000,000 shares at September 30, 2016 (unaudited) and December
31, 2015; Issued and Outstanding: 5,713,383 and 2,911,788 shares at
September 30, 2016 (unaudited) and December 31, 2015,
respectively
|
|
6
|
|
5
|
Preferred Stock of
$0.0001 par value - Authorized:
5,000,000 shares at September 30, 2016 (unaudited)
and December 31, 2015; Issued and
Outstanding: None at September 30, 2016 (unaudited) and December
31, 2015
|
|
-
|
|
-
|
Additional paid-in
capital
|
|
54,077
|
|
41,769
|
Accumulated
deficit
|
|
(49,723)
|
|
(43,354)
|
Total stockholders'
equity (deficiency)
|
|
4,360
|
|
(1,580)
|
Total liabilities and
stockholders' equity (deficiency)
|
|
$
6,696
|
|
$
5,077
|
DARIOHEALTH
CORP.
|
|
|
|
CONSOLIDATED
STATEMENTS OF COMPREHENSIVE LOSS
|
|
|
|
U.S. dollars in
thousands (except stock and stock data)
|
|
|
|
|
|
Three months ended
September 30
|
|
Nine months ended
September 30
|
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
|
|
Unaudited
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$
728
|
|
$
273
|
|
$
1,965
|
|
$
515
|
|
Cost of
revenues
|
|
652
|
|
404
|
|
2,148
|
|
1,111
|
|
|
|
|
|
|
|
|
|
|
|
Gross (profit)
loss
|
|
(76)
|
|
131
|
|
183
|
|
596
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
$
659
|
|
$
667
|
|
$
1,577
|
|
$
1,991
|
|
Sales and
marketing
|
|
1,533
|
|
417
|
|
3,194
|
|
931
|
|
General and
administrative
|
|
605
|
|
1,332
|
|
2,313
|
|
2,318
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
2,797
|
|
2,416
|
|
7,084
|
|
5,240
|
|
|
|
|
|
|
|
|
|
|
|
Operating
loss
|
|
2,721
|
|
2,547
|
|
7,267
|
|
5,836
|
|
|
|
|
|
|
|
|
|
|
|
Financial expenses
(income), net:
|
|
|
|
|
|
|
|
|
|
Revaluation of
warrants
|
|
(1,658)
|
|
(753)
|
|
(2,315)
|
|
(377)
|
|
Other financial
expense, net
|
|
678
|
|
35
|
|
697
|
|
11
|
|
|
|
|
|
|
|
|
|
|
|
Total financial
expenses (income), net
|
|
(980)
|
|
(718)
|
|
(1,618)
|
|
(366)
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
1,741
|
|
$
1,829
|
|
$
5,649
|
|
$
5,470
|
|
|
|
|
|
|
|
|
|
|
|
Deemed dividend related
to warrants exchange agreement
|
|
$
-
|
|
$
-
|
|
$
-
|
|
$
154
|
|
Deemed dividend related
to Series A Preferred Stock exchange agreement
|
|
$
-
|
|
$
-
|
|
$
455
|
|
$
-
|
|
Deemed dividend related
to extension of July 2015 Series A warrants in July 2016
|
|
$
265
|
|
$
-
|
|
$
265
|
|
$
-
|
|
Net loss attributable
to holders of Common Stock
|
|
$
2,006
|
|
$
1,829
|
|
$
6,369
|
|
$
5,624
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per
share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss
per share
|
|
$
(0.31)
|
|
$
(0.90)
|
|
$
(1.13)
|
|
$
(3.42)
|
|
Weighted average
number of Common Stock used in computing basic and diluted net loss
per share
|
|
5,705,229
|
|
2,079,622
|
|
5,019,918
|
|
1,657,550
|
|
|
|
|
|
|
|
|
|
|
|
DARIOHEALTH
CORP.
|
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
|
U.S. dollars in
thousands
|
|
|
|
|
Nine months ended
September 30,
|
|
|
2016
|
|
2015
|
|
|
Unaudited
|
Cash flows from
operating activities:
|
|
|
|
|
Net loss
|
|
$
(5,649)
|
|
$
(5,470)
|
Adjustments required
to reconcile net loss to net cash used in operating
activities:
|
|
|
|
|
Stock-based
compensation and Common Stock to service providers
|
|
1,564
|
|
1,439
|
Depreciation
|
|
273
|
|
248
|
Decrease (increase) in
accounts receivables
|
|
(257)
|
|
-
|
Decrease (increase)
accounts receivables and prepaid expenses
|
|
80
|
|
(120)
|
Decrease (increase) in
inventories
|
|
(517)
|
|
(81)
|
Increase in trade
payables
|
|
49
|
|
183
|
Increase (decrease) in
deferred revenues
|
|
(31)
|
|
30
|
Increase (decrease) in
other accounts payable and accrued expenses
|
|
283
|
|
(58)
|
Increase (decrease) in
the fair value of warrants
|
|
(2,315)
|
|
(377)
|
Capital loss from
disposal of fixed assets
|
|
-
|
|
(8)
|
Net cash used in
operating activities
|
|
(6,520)
|
|
(4,214)
|
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
|
Proceeds of maturities
of short-term bank deposit
|
|
-
|
|
333
|
Investment in
short-term bank deposit
|
|
(155)
|
|
(330)
|
Investment in
restricted cash
|
|
-
|
|
(10)
|
Maturity of lease
deposits
|
|
1
|
|
12
|
Purchase of property
and equipment
|
|
(406)
|
|
(70)
|
Net cash used in
investing activities
|
|
(560)
|
|
(65)
|
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
|
Proceeds from issuance
of Common Stock and warrants, net of issuance cost
|
|
7,538
|
|
1,956
|
Proceeds from issuance
of Common Stock and warrants, net of issuance cost
|
|
-
|
|
2,325
|
Proceeds from
conversion of warrants, net of issuance cost
|
|
-
|
|
453
|
Proceeds from exercise
of options and warrants
|
|
210
|
|
*) -
|
|
|
|
|
|
Net cash provided by
financing activities
|
|
7,748
|
|
4,734
|
|
|
|
|
|
Increase in cash and
cash equivalents
|
|
668
|
|
455
|
Cash and cash
equivalents at the beginning of the period
|
|
2,671
|
|
1,453
|
|
|
|
|
|
Cash and cash
equivalents at the end of the period
|
|
$
3,339
|
|
$
1,908
|
|
|
|
|
|
Non-cash investing and
financing activities:
|
|
|
|
|
Purchase
of property and equipment
|
|
$
-
|
|
$
26
|
Conversion
of Series A Preferred Stock into Common Stock
|
|
$
2,277
|
|
$
400
|
Payment
for directors under Salary Program
|
|
$
154
|
|
$
192
|
|
|
|
|
|
*) Represents an
amount lower than $1
|
|
|
|
|
Logo -
http://photos.prnewswire.com/prnh/20160802/395077LOGO
|
|
Press
|
Investor
Relations
|
|
|
Shmuel
Herschberg
DarioHealth
Corp.
|
Rob Fink/Brett
Mass
Hayden IR
|
+1-800-896-9062
|
+1-646-415-8972/+1-646-536-7331
|
shmuel@mydario.com
|
DRIO@HaydenIR.com
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/dariohealth-reports-third-quarter-2016-results-300360744.html
SOURCE DarioHealth Corp.