Acutus Medical, Inc. (“Acutus” or the “Company”) (Nasdaq: AFIB), an
arrhythmia management company focused on improving the way cardiac
arrhythmias are diagnosed and treated, today reported results for
the first quarter of 2023.
Recent Highlights:
- Reported revenue of $4.2 million for
the first quarter of 2023, a 13% increase compared to $3.7 million
for the same quarter last year.
- Continued improvement in financial
performance with year-over-year reductions of 58% in GAAP operating
expenses, and year-over-year reductions of 39% in both non-GAAP
operating expenses and cash burn for the first quarter of
2023.
- Increased full year revenue outlook to
$19.0 million-$21.0 million, reflecting strong double-digit
growth.
- Announced publication of the RECOVER AF
study, which underscored AcQMap’s differentiated offering for
retreatment procedures and ability to fulfill a major unmet need in
the market.
“We are pleased with the advancement of our key strategic
initiatives thus far in 2023 as we set the foundation for stronger
growth”, said David Roman, President & CEO of Acutus. “In
addition to year-over-year revenue growth, our first quarter
results demonstrated further progress in our effort to strengthen
the Company’s financial position with year-over-year improvements
in non-GAAP gross margin, operating expenses, and cash burn.”
First Quarter
2023 Financial Results
Revenue was $4.2 million for the first quarter of 2023, an
increase of 13% compared to $3.7 million for the first quarter of
2022. The improvement over the same quarter last year was driven by
higher AcQMap disposable revenue in markets outside the United
States, increased Service, Rent and Other Revenue, and sales
through the Company’s distribution agreement with Medtronic.
Gross margin on a GAAP basis was negative 63% for the first
quarter of 2023 compared to negative 89% for the same quarter last
year. The improvement was primarily driven by a higher production
volume, lower manufacturing variances, and a significantly reduced
manufacturing overhead structure.
Operating expenses consisting of research and development and
selling, general and administrative expenses on a GAAP basis were
$15.7 million for the first quarter of 2023 compared with $22.4
million for the same quarter last year. Non-GAAP operating expenses
were $13.9 million for the first quarter of 2023 compared with
$22.7 million in the same quarter last year. The decrease in
operating expenses on both a GAAP and Non-GAAP basis resulted from
the Company’s restructuring actions in the first half of 2022,
reduced by discretionary spend, and the reprioritization of certain
research and development programs.
Net loss on a GAAP basis was $16.3 million for the first quarter
of 2023 and net loss per share was $0.57 on a weighted average
basic and diluted outstanding share count of 28.8 million, compared
to a net loss of $40.0 million and a net loss per share of $1.42 on
a weighted average basic and diluted outstanding share count of
28.1 million in the same period of the prior year.
Excluding amortization of acquired intangibles, non-cash
stock-based compensation expense, restructuring charges, change in
fair value of warrant liability, change in the fair value of
contingent consideration and gain on sale of business, the
Company’s non-GAAP net loss for the first quarter of 2023 was $16.8
million, or $0.59 per share, compared to a net loss of $28.5
million, or $1.00 per share, for the first quarter of 2022.
Cash, cash equivalents, marketable securities and restricted
cash were $76.7 million as of March 31, 2023.
2023 Outlook
The company expects full year 2023 revenue to be in a range from
$19.0-$21.0 million.
Non-GAAP Financial Measures
This press release includes references to non-GAAP net loss and
non-GAAP basic and diluted net loss per share, which are non-GAAP
financial measures, to provide information that may assist
investors in understanding the Company’s financial results and
assessing its prospects for future performance. The Company
believes these non-GAAP financial measures are important indicators
of its operating performance because they exclude items that are
primarily non-cash accounting line items unrelated to, and may not
be indicative of, the Company’s core operating results. These
non-GAAP financial measures, as Acutus calculates them, may not
necessarily be comparable to similarly titled measures of other
companies and may not be appropriate measures for comparing the
performance of other companies relative to the Company. These
non-GAAP financial results are not intended to represent and should
not be considered to be more meaningful measures than, or
alternatives to, measures of operating performance as determined in
accordance with GAAP. Non-GAAP net loss is defined as net loss
before income taxes, adjusted for stock-based compensation,
amortization of acquisition-related intangibles, employee retention
credit, goodwill impairment, restructuring charges, changes in the
fair value of contingent consideration, gain on sale of business,
loss on debt extinguishment and change in fair value of warrant
liability and other adjustments. To the extent such non-GAAP
financial measures are used in the future, the Company expects to
calculate them using a consistent method from period to period. A
reconciliation of the most directly comparable GAAP financial
measure to the non-GAAP financial measure has been provided under
the heading “Reconciliation of GAAP Results to Non-GAAP Results” in
the financial statement tables attached to this press release.
Webcast and Conference Call Information
Acutus will host a conference call to discuss the first quarter
2023 financial results after market close on Thursday, May 11,
2023 at 1:30 p.m. Pacific Time / 4:30 p.m. Eastern Time. To access
the live call via telephone, please register in advance using the
link:
https://register.vevent.com/register/BIa1254f845156421eb004052b75889416.
Upon registering, each participant will receive an email
confirmation with dial-in numbers and a unique personal PIN that
can be used to join the call. The live webinar of the call may be
accessed at https://ir.acutusmedical.com.
About Acutus
Acutus is an arrhythmia management company focused on improving
the way cardiac arrhythmias are diagnosed and treated. Acutus is
committed to advancing the field of electrophysiology with a unique
array of products and technologies which will enable more
physicians to treat more patients more efficiently and effectively.
Through internal product development, acquisitions and global
partnerships, Acutus has established a global sales presence
delivering a broad portfolio of highly differentiated
electrophysiology products that provide its customers with a
complete solution for catheter-based treatment of cardiac
arrhythmias. Founded in 2011, Acutus is based in Carlsbad,
California.
Caution Regarding Forward-Looking
Statements
This press release includes statements that may constitute
“forward-looking” statements, usually containing the words
“believe,” “estimate,” “project,” “expect” or similar expressions.
Forward-looking statements inherently involve risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. Factors that would cause or
contribute to such differences include, but are not limited to, the
Company’s ability to continue to manage expenses and cash burn rate
at sustainable levels, continued acceptance of its products in the
marketplace, the effect of global economic conditions on the
ability and willingness of customers to purchase the Company’s
systems and the timing of such purchases, competitive factors,
changes resulting from healthcare policy in the United States and
globally including changes in government reimbursement of
procedures, dependence upon third-party vendors and distributors,
timing of regulatory approvals, the impact of the coronavirus
(COVID-19) pandemic and Acutus’ response to it and other risks
discussed in the Company’s periodic and other filings with the
Securities and Exchange Commission. By making these forward-looking
statements, Acutus undertakes no obligation to update these
statements for revisions or changes after the date of this release,
except as required by law.
Investor
Contact: |
Media Contact: |
Caroline Corner |
Rhiannon Pickus |
Westwicke ICR |
Acutus Medical, Inc. |
D: 415-202-5678 |
M: 442-232-6094 |
caroline.corner@westwicke.com |
Rhiannon.Pickus@acutus.com |
|
|
|
ACUTUS MEDICAL, INC. |
Condensed Consolidated Balance Sheets |
(in thousands, except per share amounts) |
|
|
|
March 31, 2023 |
|
December 31, 2022 |
|
|
(unaudited) |
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
22,738 |
|
|
$ |
25,584 |
|
Marketable securities, short-term |
|
|
46,839 |
|
|
|
44,863 |
|
Restricted cash, short-term |
|
|
7,139 |
|
|
|
5,764 |
|
Accounts receivable |
|
|
5,340 |
|
|
|
21,085 |
|
Inventory |
|
|
14,938 |
|
|
|
13,327 |
|
Employer retention credit receivable |
|
|
2,562 |
|
|
|
4,703 |
|
Prepaid expenses and other current assets |
|
|
2,232 |
|
|
|
2,541 |
|
Total current assets |
|
|
101,788 |
|
|
|
117,867 |
|
|
|
|
|
|
Property and equipment,
net |
|
|
8,145 |
|
|
|
9,221 |
|
Right-of-use asset, net |
|
|
3,708 |
|
|
|
3,872 |
|
Intangible assets, net |
|
|
1,533 |
|
|
|
1,583 |
|
Other assets |
|
|
822 |
|
|
|
897 |
|
Total
assets |
|
$ |
115,996 |
|
|
$ |
133,440 |
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
5,569 |
|
|
$ |
4,721 |
|
Accrued liabilities |
|
|
7,302 |
|
|
|
9,686 |
|
Contingent consideration, short-term |
|
|
2,000 |
|
|
|
1,800 |
|
Operating lease liabilities, short-term |
|
|
339 |
|
|
|
319 |
|
Warrant liability |
|
|
1,900 |
|
|
|
3,346 |
|
Total current liabilities |
|
|
17,110 |
|
|
|
19,872 |
|
|
|
|
|
|
Operating lease liabilities,
long-term |
|
|
3,883 |
|
|
|
4,103 |
|
Long-term debt |
|
|
34,526 |
|
|
|
34,434 |
|
Other long-term
liabilities |
|
|
11 |
|
|
|
12 |
|
Total liabilities |
|
|
55,530 |
|
|
|
58,421 |
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
Stockholders'
equity |
|
|
|
|
Preferred stock, $0.001 par
value; 5,000,000 shares authorized as of March 31, 2023 and
December 31, 2022; 6,666 shares of the preferred stock,
designated as Series A Common Equivalent Preferred Stock, are
issued and outstanding as of March 31, 2023 and
December 31, 2022 |
|
|
— |
|
|
|
— |
|
Common stock, $0.001 par
value; 260,000,000 shares authorized as of March 31, 2023 and
December 31, 2022; 28,894,080 and 28,554,656 shares issued and
outstanding as of March 31, 2023 and December 31, 2022,
respectively |
|
|
29 |
|
|
|
29 |
|
Additional paid-in
capital |
|
|
595,864 |
|
|
|
594,173 |
|
Accumulated deficit |
|
|
(534,629 |
) |
|
|
(518,314 |
) |
Accumulated other
comprehensive loss |
|
|
(798 |
) |
|
|
(869 |
) |
Total stockholders'
equity |
|
|
60,466 |
|
|
|
75,019 |
|
Total liabilities and
stockholders' equity |
|
$ |
115,996 |
|
|
$ |
133,440 |
|
|
ACUTUS MEDICAL, INC. |
Condensed Consolidated Statements of Operations and
Comprehensive Loss |
(in thousands, except per share amounts) |
|
|
|
Three Months Ended March 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
(unaudited) |
Revenue |
|
$ |
4,170 |
|
|
$ |
3,681 |
|
Cost of products
sold |
|
|
6,790 |
|
|
|
6,941 |
|
Gross profit |
|
|
(2,620 |
) |
|
|
(3,260 |
) |
|
|
|
|
|
Operating expenses
(income): |
|
|
|
|
Research and development |
|
|
6,117 |
|
|
|
8,003 |
|
Selling, general and administrative |
|
|
9,565 |
|
|
|
14,385 |
|
Goodwill impairment |
|
|
— |
|
|
|
12,026 |
|
Restructuring |
|
|
12 |
|
|
|
949 |
|
Change in fair value of contingent consideration |
|
|
200 |
|
|
|
7 |
|
Gain on sale of business |
|
|
(1,207 |
) |
|
|
— |
|
Total operating (income)
expenses |
|
|
14,687 |
|
|
|
35,370 |
|
Loss from
operations |
|
|
(17,307 |
) |
|
|
(38,630 |
) |
|
|
|
|
|
Other income
(expense): |
|
|
|
|
Change in fair value of warrant liability |
|
|
1,446 |
|
|
|
— |
|
Interest income |
|
|
853 |
|
|
|
24 |
|
Interest expense |
|
|
(1,307 |
) |
|
|
(1,411 |
) |
Total other income (expense),
net |
|
|
992 |
|
|
|
(1,387 |
) |
Loss before income taxes |
|
|
(16,315 |
) |
|
|
(40,017 |
) |
Income tax benefit |
|
|
— |
|
|
|
— |
|
Net loss |
|
$ |
(16,315 |
) |
|
$ |
(40,017 |
) |
|
|
|
|
|
Other comprehensive
income (loss): |
|
|
|
|
Unrealized gain (loss) on marketable securities |
|
|
12 |
|
|
|
(57 |
) |
Foreign currency translation adjustment |
|
|
59 |
|
|
|
(166 |
) |
Comprehensive
loss |
|
$ |
(16,244 |
) |
|
$ |
(40,240 |
) |
|
|
|
|
|
Net loss per common share,
basic and diluted |
|
$ |
(0.57 |
) |
|
$ |
(1.42 |
) |
Weighted average shares
outstanding, basic and diluted |
|
|
28,764,444 |
|
|
|
28,118,090 |
|
|
ACUTUS MEDICAL, INC. |
Condensed Consolidated Statements of Cash
Flows |
(in thousands) |
|
|
|
Three Months Ended March 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
(unaudited) |
Cash flows from operating
activities |
|
|
|
|
Net loss |
|
$ |
(16,315 |
) |
|
$ |
(40,017 |
) |
Adjustments to reconcile net loss
to net cash used in operating activities: |
|
|
|
|
Depreciation expense |
|
|
1,297 |
|
|
|
1,567 |
|
Amortization of intangible assets |
|
|
50 |
|
|
|
160 |
|
Non-cash stock-based compensation expense |
|
|
1,904 |
|
|
|
3,032 |
|
(Accretion of discounts) amortization of premiums on marketable
securities, net |
|
|
(527 |
) |
|
|
173 |
|
Amortization of debt issuance cost |
|
|
104 |
|
|
|
378 |
|
Amortization of operating lease right-of-use assets |
|
|
164 |
|
|
|
160 |
|
Goodwill impairment |
|
|
— |
|
|
|
12,026 |
|
Gain on sale of business, net |
|
|
(1,207 |
) |
|
|
— |
|
Change in fair value of warrant liability |
|
|
(1,446 |
) |
|
|
— |
|
Loss on disposal of property and equipment |
|
|
38 |
|
|
|
— |
|
Change in fair value of contingent consideration |
|
|
200 |
|
|
|
7 |
|
Changes in operating assets and liabilities: |
|
|
|
|
Accounts receivable |
|
|
(11 |
) |
|
|
655 |
|
Inventory |
|
|
(1,611 |
) |
|
|
(1,212 |
) |
Employer retention credit receivable |
|
|
2,141 |
|
|
|
— |
|
Prepaid expenses and other current assets |
|
|
391 |
|
|
|
(3,487 |
) |
Other assets |
|
|
75 |
|
|
|
120 |
|
Accounts payable |
|
|
873 |
|
|
|
(2,641 |
) |
Accrued liabilities |
|
|
(2,433 |
) |
|
|
1,532 |
|
Operating lease liabilities |
|
|
(201 |
) |
|
|
(14 |
) |
Other long-term liabilities |
|
|
(1 |
) |
|
|
(48 |
) |
Net cash used in operating
activities |
|
|
(16,515 |
) |
|
|
(27,609 |
) |
|
|
|
|
|
Cash flows from investing
activities |
|
|
|
|
Proceeds from sale of business |
|
|
17,000 |
|
|
|
— |
|
Purchases of available-for-sale marketable securities |
|
|
(28,019 |
) |
|
|
— |
|
Sales of available-for-sale marketable securities |
|
|
— |
|
|
|
2,500 |
|
Maturities of available-for-sale marketable securities |
|
|
26,500 |
|
|
|
14,587 |
|
Purchases of property and equipment |
|
|
(232 |
) |
|
|
(1,088 |
) |
Net cash provided by investing
activities |
|
|
15,249 |
|
|
|
15,999 |
|
|
|
|
|
|
Cash flows from financing
activities |
|
|
|
|
Proceeds from the exercise of stock options |
|
|
4 |
|
|
|
66 |
|
Repurchase of common shares to pay employee withholding taxes |
|
|
(217 |
) |
|
|
— |
|
Proceeds from employee stock purchase plan |
|
|
— |
|
|
|
182 |
|
Payment of contingent consideration |
|
|
— |
|
|
|
(290 |
) |
Net cash used in financing
activities |
|
|
(213 |
) |
|
|
(42 |
) |
|
|
|
|
|
Effect of exchange rate changes
on cash, cash equivalents and restricted cash |
|
|
8 |
|
|
|
(100 |
) |
|
|
|
|
|
Net change in cash, cash
equivalents and restricted cash |
|
|
(1,471 |
) |
|
|
(11,752 |
) |
Cash, cash equivalents and
restricted cash, at the beginning of the period |
|
|
31,348 |
|
|
|
24,221 |
|
Cash, cash equivalents
and restricted cash, at the end of the period |
|
$ |
29,877 |
|
|
$ |
12,469 |
|
|
|
|
|
|
Supplemental disclosure
of cash flow information: |
|
|
|
|
Cash paid for interest |
|
$ |
1,207 |
|
|
$ |
1,025 |
|
|
|
|
|
|
Supplemental disclosure
of noncash investing and financing activities: |
|
|
|
|
Accounts receivable from sale
of business |
|
$ |
1,244 |
|
|
$ |
— |
|
Change in unrealized (gain)
loss on marketable securities |
|
$ |
(12 |
) |
|
$ |
57 |
|
Change in unpaid purchases of
property and equipment |
|
$ |
(25 |
) |
|
$ |
(97 |
) |
Contingent consideration
escrow release |
|
$ |
— |
|
|
$ |
17 |
|
|
ACUTUS MEDICAL, INC. |
Reconciliation of GAAP Results to Non-GAAP
Results |
(in thousands) |
(unaudited) |
|
Three Months Ended March 31, 2023 |
|
Cost of Products Sold |
|
Research and Development |
|
Selling, General and Administrative |
|
Loss from Operations |
|
Other Income (Expense), Net |
|
Net Loss |
|
Basic and Diluted EPS |
Reported |
|
$ |
6,790 |
|
|
$ |
6,117 |
|
|
$ |
9,565 |
|
|
$ |
(17,307 |
) |
|
$ |
992 |
|
|
$ |
(16,315 |
) |
|
$ |
(0.57 |
) |
Amortization of acquired intangibles |
|
|
(50 |
) |
|
|
— |
|
|
|
— |
|
|
|
50 |
|
|
|
— |
|
|
|
50 |
|
|
|
0.00 |
|
Stock-based compensation |
|
|
(74 |
) |
|
|
(346 |
) |
|
|
(1,484 |
) |
|
|
1,904 |
|
|
|
— |
|
|
|
1,904 |
|
|
|
0.07 |
|
Restructuring charges |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12 |
|
|
|
— |
|
|
|
12 |
|
|
|
0.00 |
|
Change in fair value of warrant liability |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,446 |
) |
|
|
(1,446 |
) |
|
|
(0.05 |
) |
Change in fair value of contingent consideration |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
200 |
|
|
|
— |
|
|
|
200 |
|
|
|
0.00 |
|
Gain on sale of business |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,207 |
) |
|
|
— |
|
|
|
(1,207 |
) |
|
|
(0.04 |
) |
Adjusted |
|
$ |
6,666 |
|
|
$ |
5,771 |
|
|
$ |
8,081 |
|
|
$ |
(16,348 |
) |
|
$ |
(454 |
) |
|
$ |
(16,802 |
) |
|
$ |
(0.59 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2022 |
|
Cost of Products Sold |
|
Research and Development |
|
Selling, General and Administrative |
|
Loss from Operations |
|
Other Expense, Net |
|
Net Loss |
|
Basic and Diluted EPS |
Reported |
|
$ |
6,941 |
|
|
$ |
8,003 |
|
|
$ |
14,385 |
|
|
$ |
(38,630 |
) |
|
$ |
(1,387 |
) |
|
$ |
(40,017 |
) |
|
$ |
(1.42 |
) |
Amortization of acquired intangibles |
|
|
(155 |
) |
|
|
— |
|
|
|
(5 |
) |
|
|
160 |
|
|
|
— |
|
|
|
160 |
|
|
|
0.01 |
|
Stock-based compensation |
|
|
(226 |
) |
|
|
(514 |
) |
|
|
(2,292 |
) |
|
|
3,032 |
|
|
|
— |
|
|
|
3,032 |
|
|
|
0.11 |
|
Employee retention credit |
|
|
1,503 |
|
|
|
1,394 |
|
|
|
1,742 |
|
|
|
(4,639 |
) |
|
|
— |
|
|
|
(4,639 |
) |
|
|
(0.16 |
) |
Goodwill impairment |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
12,026 |
|
|
|
— |
|
|
|
12,026 |
|
|
|
0.43 |
|
Restructuring charges |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
949 |
|
|
|
— |
|
|
|
949 |
|
|
|
0.03 |
|
Change in fair value of contingent consideration |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7 |
|
|
|
— |
|
|
|
7 |
|
|
|
0.00 |
|
Adjusted |
|
$ |
8,063 |
|
|
$ |
8,883 |
|
|
$ |
13,830 |
|
|
$ |
(27,095 |
) |
|
$ |
(1,387 |
) |
|
$ |
(28,482 |
) |
|
$ |
(1.00 |
) |
ACUTUS MEDICAL, INC.Key
Business Metrics(unaudited)
Installed Base and Procedure Volumes
The total installed base which includes AcQMap Systems as of
March 31, 2023 and 2022 are as follows:
|
|
As of March 31, |
|
|
2023 |
|
2022 |
Acutus |
|
|
|
|
U.S. |
|
28 |
|
39 |
Outside the U.S. |
|
49 |
|
38 |
Total Acutus net system
placements |
|
77 |
|
77 |
Procedure volumes for the three months ended March 31, 2023
and 2022 are as follows:
|
|
Three Months Ended |
|
|
March 31, |
|
|
2023 |
|
2022 |
Procedure volumes |
|
433 |
|
465 |
Revenue
The following table sets forth the Company’s revenue for
disposables, systems and service/other for the three months ended
March 31, 2023 and 2022 (in thousands):
|
|
Three Months Ended |
|
|
March 31, |
|
|
|
2023 |
|
|
2022 |
Disposables |
|
$ |
3,426 |
|
$ |
3,211 |
Systems |
|
|
— |
|
|
— |
Service / other |
|
|
744 |
|
|
470 |
Total revenue |
|
$ |
4,170 |
|
$ |
3,681 |
The following table presents revenue by geographic location for
the three months ended March 31, 2023 and 2022 (in
thousands):
|
|
Three Months Ended |
|
|
March 31, |
|
|
|
2023 |
|
|
2022 |
United States |
|
$ |
2,248 |
|
$ |
2,023 |
Outside the United States |
|
|
1,922 |
|
|
1,658 |
Total revenue |
|
$ |
4,170 |
|
$ |
3,681 |
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