Dextera Surgical Inc. (Nasdaq: DXTR), a company developing and
commercializing the MicroCutter 5/80™ Stapler, today announced
financial results for its fiscal first quarter ended September 30,
2017.
“We are making progress toward resolving our component and raw
material supply challenges and expect to begin shipping reloads in
December and to resolving our current backorder of $225,000 and
returning to production,” said Julian Nikolchev, president and CEO
of Dextera Surgical Inc. “In addition, Intuitive Surgical informed
us that it plans to pursue development of robotic staplers based on
conventional staple technology and will not continue development of
the MicroCutter technology at this time.”
“In light of the state of our business, we continue to pursue
strategic options including the sale of some or all of our assets,
raising adequate additional capital, cost containment initiatives
and a potential filing for bankruptcy.”
Recent Highlights and Accomplishments:
- Sponsored an international hands-on
training course for thoracic surgeons from across Europe focused on
advanced techniques for video-assisted thoracic surgery
(VATS).
- Received clearance from the U.S. Food
and Drug Administration to use the MicroCutter 5/80 Stapler and
MicroCutter 30 White and Curved Tip White Reloads in conjunction
with open solid organ parenchymal dissection techniques including
organs such as the liver, kidney, pancreas and spleen.
- The MicroCutter 5/80 and the C-Port®
Distal Anastomosis Systems were featured in three oral
presentations at the 31st Annual European Association for
Cardio-Thoracic Surgery.
Fiscal 2018 First Quarter Financial Results
Total product sales were approximately $0.6 million for the
fiscal 2018 first quarter compared with $0.4 million for the same
quarter of fiscal 2017. MicroCutter sales were approximately
$203,000 in the fiscal 2018 first quarter with approximately
$180,000 in backorders compared to $359,000 of sales and $75,000 in
backorders in the fourth quarter of fiscal 2017. The sequential
decrease in MicroCutter product sales is due to production
constraints for the blue and white reloads from both unanticipated
variability in raw materials and implementation of improved design
changes taking longer than plan. Total revenue was approximately
$0.7 million for the fiscal 2018 first quarter compared with
approximately $0.5 million for the fiscal 2017 first quarter.
Total operating costs and expenses for the fiscal 2018 first
quarter were $4.5 million, compared with $4.3 million for the same
period of fiscal 2017. Cost of product sales was approximately $1.0
million for the first quarter of fiscal 2018 compared with $0.5
million for the same period of 2017. Research and development
expenses were $1.7 million for the fiscal 2018 first quarter,
compared with $1.8 million for the fiscal 2017 first quarter.
Selling, general and administrative expenses were $1.8 million for
the fiscal 2018 first quarter compared with $2.0 million for the
comparable period of fiscal 2017.
The net loss for the fiscal 2018 first quarter before the deemed
preferred stock dividend was approximately $3.5 million.
Additionally, net loss applicable to common stockholders included a
deemed (non-cash) preferred stock dividend of $0.1 million,
representing the value of beneficial conversion rights embedded in
the preferred shares issued in the company’s recently completed
convertible preferred stock public offering. This amount was
determined as the difference between fair value of common stock
into which preferred shares are convertible and the proceeds of the
financing allocated to the preferred shares. The total net loss
attributable to common stockholders for the fiscal 2018 first
quarter was $3.6 million, or $0.09 per share. Net loss attributable
to common stockholders for the fiscal 2017 first quarter was
approximately $4.0 million, or $0.44 per share.
Cash and cash equivalents, as of September 30, 2017, were
approximately $4.2 million, compared with approximately $6.0
million at June 30, 2017. As of September 30, 2017, there were
approximately 48.2 million shares of common stock outstanding,
which includes the conversion of all previously outstanding Series
A convertible preferred stock and all but 172 shares of Series B
convertible preferred stock.
Milestones
Management’s key objectives in the near term are as follows:
- Begin shipping MicroCutter 5/80 reloads
by the end of calendar 2017;
- Execute corporate agreement, asset
sales, strategic partnership or possibly file for bankruptcy;
and,
- Evaluate and execute initiatives to
reduce cost structure and improve long-term gross margins.
About Dextera Surgical
Dextera Surgical designs and manufactures proprietary
stapling devices for minimally invasive surgical procedures. In the
U.S., surgical staplers are routinely used in more than one million
minimally invasive laparoscopic, video-assisted or robotic-assisted
surgical procedures annually.
Dextera Surgical also markets the only automated
anastomosis devices for coronary artery bypass graft (CABG) surgery
on the market today: the C-Port® Distal Anastomosis Systems and
PAS-Port® Proximal Anastomosis System. These products, sold
by Dextera Surgical under the Cardica brand name, have
demonstrated long-term reliable clinical performance for more than
a decade.
Forward-Looking Statements
The statements in this press release regarding Dextera
Surgical’s and its management objectives in Mr. Nikolchev’s quote
and under the caption “Milestones,” are "forward-looking
statements." There are a number of important factors that could
cause Dextera Surgical’s results to differ materially from those
indicated by these forward-looking statements, including the risks
detailed from time to time in Dextera Surgical’s reports filed with
the U.S. Securities and Exchange Commission, including its Annual
Report on Form 10-K for the year ended June 30, 2017, under
the caption “Risk Factors.” Dextera Surgical expressly disclaims
any obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein. You
are encouraged to read Dextera Surgical’s reports filed with the
U.S. Securities and Exchange Commission, available at
www.sec.gov.
Dextera Surgical Inc. Consolidated Statements of
Operations (amounts in thousands except per share amounts)
Three months ended September 30, 2017
2016 (unaudited) Revenue Product sales, net $ 572 $ 427
License and development revenue 105 26 Royalty revenue 17
14 Total 694 467 Operating costs and
expenses Cost of product sales 951 515 Research and development
1,748 1,768 Selling, general and administrative 1,824
2,019 Total operating costs and expenses 4,523
4,302 Loss from operations (3,829 )
(3,835 ) Interest and other income 442 13 Interest expense
(150 ) (133 ) Net loss (3,537 ) (3,955 )
Deemed dividend attributable to convertible preferred stock
(101 ) - Net loss allocable to common stockholders $
(3,638 ) $ (3,955 ) Basic net loss per share
allocable to common stockholders $ (0.09 ) $ (0.44 ) Diluted
net loss per share allocable to common stockholders $ (0.09 ) $
(0.44 ) Shares used in computing basic net loss per share
allocable to common stockholders 42,660 8,928
Shares used in computing diluted net loss per share
allocable to common stockholders 45,199 8,928
Consolidated Balance Sheets (amounts in
thousands) September 30,
June
30,
2017 2017 Assets (unaudited) Cash and
cash equivalents 4,180 $ 6,010 Accounts receivable 342 608
Inventories 1,172 1,311 Other assets 836 942
Total assets $ 6,530 $ 8,871
Liabilities and stockholders' equity Accounts payable and other
liabilities $ 1,739 $ 2,296 Warrant liabilities 6,789 $ 8,638
Deferred revenue 2,845 2,902 Long term debt 3,448 3,473 Total
stockholders' equity (8,291 ) (8,438 ) Total
liabilities and stockholders' equity $ 6,530 $ 8,871
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Dextera Surgical Inc.Bob Newell, 650-331-7133Vice President,
Finance and Chief Financial
Officerinvestors@dexterasurgical.com