TUCSON, Ariz., Feb. 27, 2020 /PRNewswire/ -- Accelerate
Diagnostics, Inc. (Nasdaq: AXDX) today announced financial results
for the fourth quarter and full year ended December 31, 2019.
"Our contracted instrument trajectory continued over the course
of 2019 as we doubled our global contracted instrument base by
signing 304 instruments, including 137 units during the fourth
quarter. Our full-year revenue was short of expectations as
multi-site customers in the U.S. have taken longer than anticipated
to go live and begin generating consumable revenue," said
Jack Phillips, president and chief
executive officer of Accelerate Diagnostics, Inc. "One of my
initial areas of focus was to evaluate and re-engineer our go-live
process, and I am confident the resulting improvements will help
relieve our 255 U.S. instrument backlog and make the process
quicker and more predictable. For clinically live accounts, I am
encouraged that annual annuities are approximately $45k, proving to be predictable, and these
customers are enthusiastic about the outcomes they are
realizing."
Fourth Quarter 2019 Highlights
- Added 137 net new commercially contracted instruments, compared
to 133 in the fourth quarter of 2018.
- Net sales of $3.5 million,
compared to $1.8 million in the
fourth quarter of 2018, or 94% year-over-year growth.
- Gross margin was 44% for the quarter, compared to 29% in the
fourth quarter of 2018. This increase was the result of lower
consumable production costs per unit as production volumes
increase. Certain perishable raw materials exceeded expiration and
required disposal in the quarter. Excluding the impact of this
charge, gross margin for the fourth quarter was 51%.
- Research and development (R&D) costs for the quarter were
$6.2 million, compared to
$6.9 million in the fourth quarter of
2018. We expected this spend to remain relatively flat on a
year-over-year basis, as our R&D programs remain
consistent.
- Selling, general, and administrative expenses for the quarter
were $13.6 million, compared to
$13.4 million in the fourth quarter
of 2018. These expenses remained relatively unchanged on a
year-over-year basis.
- Net loss was $21.3 million in the
fourth quarter, or $0.39 per share,
which included $3.2 million in
non-cash stock-based compensation expense.
- Net cash used in the quarter was $13.5
million, and the company ended the quarter with total cash,
investments, and cash equivalents of $108.5
million.
Full Year 2019 Highlights
- Added 304 net new commercially contracted instruments year to
date, compared to 202 in 2018.
- Net sales of $9.3 million,
compared to $5.7 million in 2018, or
63% year over year growth.
- Gross margin was 47%, compared to 44% in 2018. This increase
was the result of lower consumable production costs per unit as
production volumes increase. Certain perishable raw materials
exceeded expiration and required disposal in the fourth quarter.
Excluding the impact of this charge, gross margin for the year was
53%.
- Selling, general, and administrative expenses were $51.9 million, compared to $55.2 million in 2018. This decrease was driven
by lower stock-based compensation expense in the current year.
- Research and development (R&D) costs were $25.3 million, compared to $27.6 million in 2018. We expected this spend to
remain relatively flat on a year-over-year basis, as our R&D
programs remain consistent.
- Net loss was $84.3 million, or
$1.55 per share, which included
$12.6 million in non-cash stock-based
compensation expense.
- Net cash used was $58.0 million,
and the company ended the year with total cash, investments, and
cash equivalents of $108.5
million.
Full financial results for the quarter and year ending
December 31, 2019 will be filed on
Form 10-K through the Securities and Exchange Commission's (SEC)
website at http://www.sec.gov.
Audio Webcast and Conference Call
The company will host a conference call at 4:30PM ET today to review its first quarter
results. To listen to the conference call, dial +1.877.883.0383 and
enter the conference ID: 2860141. International participants may
dial +1.412.902.6506. Please dial in 10 to 15 minutes prior to the
start of the conference call. A replay of the call will be
available by telephone at +1.877.344.7529 (U.S.) or +1.412.317.0088
(international) using replay code 10138283 until May 19, 2020.
This conference call will also be webcast and can be accessed
from the "Investors" section of the company's website at
axdx.com/investors. A replay of the audio webcast will be available
until May 19, 2020.
About Accelerate Diagnostics, Inc.
Accelerate Diagnostics, Inc. is an in vitro diagnostics
company dedicated to providing solutions for the global challenges
of antibiotic resistance and sepsis. The Accelerate Pheno® system
and Accelerate PhenoTest® BC kit combine several technologies aimed
at reducing the time clinicians must wait to determine the most
optimal antibiotic therapy for deadly infections. The FDA cleared
system and kit fully automate the sample preparation steps to
report phenotypic antibiotic susceptibility results in
approximately 7 hours direct from positive blood cultures. Recent
external studies indicate the solution offers results 1-2 days
faster than existing methods, enabling clinicians to optimize
antibiotic selection and dosage specific to the individual patient
days earlier.
The "ACCELERATE DIAGNOSTICS" and "ACCELERATE PHENO" and
"ACCELERATE PHENOTEST" and diamond shaped logos and marks are
trademarks or registered trademarks of Accelerate Diagnostics,
Inc.
For more information about the company, its products and
technology, or recent publications, visit axdx.com.
Forward-Looking Statements
Certain of the statements made in this press release are
forward looking, such as those, among others, about the company's
placement trajectory, our belief that our re-engineered go-live
process will make our implementation process quicker and more
predictable, thereby relieving our backlog, our belief that annual
annuities will average approximately $45,000, our expectation that customers will be
enthusiastic about clinical results, and our expectation that
R&D expenses will be relatively flat from 2019 to 2020. Actual
results or developments may differ materially from those projected
or implied in these forward-looking statements. Information about
the risks and uncertainties faced by Accelerate
Diagnostics is contained in the section captioned "Risk
Factors" in the company's most recent Annual Report on Form 10-K,
filed with the Securities and Exchange
Commission on February 27, 2020, and in any other reports
that the company files with the Securities and Exchange
Commission. The company's forward-looking statements could be
affected by general industry and market conditions. Except as
required by federal securities laws, the company undertakes no
obligation to update or revise these forward-looking statements to
reflect new events, uncertainties or other contingencies.
ACCELERATE
DIAGNOSTICS, INC.
|
CONSOLIDATED
|
BALANCE
SHEETS
|
(in thousands, except
share data)
|
|
|
December
31,
|
|
2019
|
2018
|
ASSETS
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$
|
61,014
|
|
$
|
66,260
|
|
Investments
|
47,437
|
|
100,218
|
|
Trade accounts
receivable
|
3,222
|
|
1,860
|
|
Inventory
|
8,059
|
|
7,746
|
|
Prepaid
expenses
|
955
|
|
980
|
|
Other current
assets
|
1,165
|
|
576
|
|
Total current
assets
|
121,852
|
|
177,640
|
|
Property and
equipment, net
|
7,905
|
|
7,303
|
|
Right of use
assets
|
3,917
|
|
—
|
|
Other non-current
assets
|
750
|
|
322
|
|
Total
assets
|
$
|
134,424
|
|
$
|
185,265
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$
|
2,351
|
|
$
|
1,322
|
|
Accrued
liabilities
|
3,828
|
|
4,962
|
|
Accrued
interest
|
1,262
|
|
1,262
|
|
Deferred
revenue
|
271
|
|
217
|
|
Current operating
lease liability
|
450
|
|
—
|
|
Total current
liabilities
|
8,162
|
|
7,763
|
|
Non-current operating
lease liability
|
3,579
|
|
—
|
|
Other non-current
liabilities
|
19
|
|
53
|
|
Convertible
notes
|
130,043
|
|
120,074
|
|
Total
liabilities
|
141,803
|
|
127,890
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
Stockholders' equity
(deficit):
|
|
|
Preferred shares,
$0.001 par value;
|
|
|
5,000,000 preferred
shares authorized and none outstanding as of December 31, 2019 and
2018
|
—
|
|
—
|
|
Common stock, $0.001
par value;
|
|
|
85,000,000 common
shares authorized with 54,708,792 shares issued and outstanding on
December 31, 2019 and 75,000,000 common shares authorized with
54,231,876 shares issued and outstanding on December 31,
2018
|
55
|
|
54
|
|
Contributed
capital
|
452,344
|
|
432,885
|
|
Treasury
stock
|
(45,067)
|
|
(45,067)
|
|
Accumulated
deficit
|
(414,653)
|
|
(330,348)
|
|
Accumulated other
comprehensive loss
|
(58)
|
|
(149)
|
|
Total stockholders'
equity (deficit)
|
(7,379)
|
|
57,375
|
|
Total liabilities and
stockholders' equity (deficit)
|
$
|
134,424
|
|
$
|
185,265
|
|
|
See accompanying
notes to consolidated financial statements.
|
ACCELERATE
DIAGNOSTICS, INC.
|
CONSOLIDATED
|
STATEMENTS OF
OPERATIONS AND COMPREHENSIVE LOSS
|
(in thousands, except
per share data)
|
|
|
Years Ended
December 31,
|
|
2019
|
2018
|
2017
|
Net
sales
|
$
|
9,297
|
|
$
|
5,670
|
|
$
|
4,177
|
|
|
|
|
|
Cost of
sales
|
4,897
|
|
3,187
|
|
1,002
|
|
Gross
profit
|
4,400
|
|
2,483
|
|
3,175
|
|
|
|
|
|
Costs and
expenses:
|
|
|
|
Research and
development
|
25,345
|
|
27,638
|
|
22,301
|
|
Sales, general and
administrative
|
51,886
|
|
55,214
|
|
45,058
|
|
Total costs and
expenses
|
77,231
|
|
82,852
|
|
67,359
|
|
|
|
|
|
Loss from
operations
|
(72,831)
|
|
(80,369)
|
|
(64,184)
|
|
|
|
|
|
Other income
(expense):
|
|
|
|
Interest
expense
|
(14,256)
|
|
(10,113)
|
|
—
|
|
Foreign currency
exchange loss
|
(124)
|
|
(450)
|
|
(75)
|
|
Interest and dividend
income
|
2,809
|
|
2,845
|
|
908
|
|
Other expense,
net
|
(14)
|
|
(28)
|
|
(184)
|
|
Total other income
(expense), net
|
(11,585)
|
|
(7,746)
|
|
649
|
|
|
|
|
|
Net loss before
income taxes
|
(84,416)
|
|
(88,115)
|
|
(63,535)
|
|
Benefit (provision)
for income taxes
|
111
|
|
(211)
|
|
(493)
|
|
Net loss
|
$
|
(84,305)
|
|
$
|
(88,326)
|
|
$
|
(64,028)
|
|
|
|
|
|
Basic and diluted net
loss per share
|
$
|
(1.55)
|
|
$
|
(1.62)
|
|
$
|
(1.18)
|
|
Weighted average
shares outstanding
|
54,506
|
|
54,494
|
|
54,073
|
|
|
|
|
|
Other
comprehensive loss:
|
|
|
|
Net loss
|
$
|
(84,305)
|
|
$
|
(88,326)
|
|
$
|
(64,028)
|
|
Net unrealized gain
(loss) on available-for-sale investments
|
193
|
|
23
|
|
(117)
|
|
Foreign currency
translation adjustment
|
(102)
|
|
(172)
|
|
321
|
|
Comprehensive
loss
|
$
|
(84,214)
|
|
$
|
(88,475)
|
|
$
|
(63,824)
|
|
|
See accompanying
notes to consolidated financial statements.
|
ACCELERATE
DIAGNOSTICS, INC.
|
CONSOLIDATED
|
STATEMENTS OF
STOCKHOLDERS' EQUITY (DEFICIT)
|
(in
thousands)
|
|
|
Shares
|
Common
Stock
Amount
|
Contributed
Capital
|
Accumulated
Deficit
|
Treasury
stock
|
Accumulated
Other
Comprehensive
Income (Loss)
|
Total
Stockholders'
Equity (Deficit)
|
Balances, January 1,
2017
|
51,516
|
|
$
|
52
|
|
$
|
255,257
|
|
$
|
(177,289)
|
|
$
|
—
|
|
$
|
(204)
|
|
$
|
77,816
|
|
Net loss
|
—
|
|
—
|
|
—
|
|
(64,028)
|
|
—
|
|
—
|
|
(64,028)
|
|
Issuance of common
stock
|
3,085
|
|
3
|
|
83,221
|
|
—
|
|
—
|
|
—
|
|
83,224
|
|
Exercise of options
and warrants
|
1,045
|
|
1
|
|
6,605
|
|
—
|
|
—
|
|
—
|
|
6,606
|
|
Issuance of common
stock under employee purchase plan
|
28
|
|
—
|
|
597
|
|
—
|
|
—
|
|
—
|
|
597
|
|
Unrealized loss on
available-for-sale securities
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(117)
|
|
(117)
|
|
Foreign currency
translation adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
321
|
|
321
|
|
Cumulative impact of
accounting change
|
—
|
|
—
|
|
—
|
|
(655)
|
|
—
|
|
—
|
|
(655)
|
|
Equity-based
compensation
|
—
|
|
—
|
|
14,940
|
|
—
|
|
—
|
|
—
|
|
14,940
|
|
Balances, December
31, 2017
|
55,674
|
|
56
|
|
360,620
|
|
(241,972)
|
|
—
|
|
—
|
|
118,704
|
|
Net loss
|
—
|
|
—
|
|
—
|
|
(88,326)
|
|
—
|
|
—
|
|
(88,326)
|
|
Exercise of options
and restricted stock awards issued
|
382
|
|
—
|
|
3,749
|
|
—
|
|
—
|
|
—
|
|
3,749
|
|
Issuance of common
stock under employee purchase plan
|
35
|
|
—
|
|
583
|
|
—
|
|
—
|
|
—
|
|
583
|
|
Unrealized gain on
available-for-sale securities
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
23
|
|
23
|
|
Foreign currency
translation adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(172)
|
|
(172)
|
|
Repurchase of common
stock under Prepaid Forward contract
|
(1,859)
|
|
(2)
|
|
—
|
|
—
|
|
(45,067)
|
|
—
|
|
(45,069)
|
|
Issuance of
convertible note
|
—
|
|
—
|
|
53,283
|
|
—
|
|
—
|
|
—
|
|
53,283
|
|
Cumulative impact of
accounting change
|
—
|
|
—
|
|
—
|
|
(50)
|
|
—
|
|
—
|
|
(50)
|
|
Equity-based
compensation
|
—
|
|
—
|
|
14,650
|
|
—
|
|
—
|
|
—
|
|
14,650
|
|
Balances, December
31, 2018
|
54,232
|
|
54
|
|
432,885
|
|
(330,348)
|
|
(45,067)
|
|
(149)
|
|
57,375
|
|
Net loss
|
—
|
|
—
|
|
—
|
|
(84,305)
|
|
—
|
|
—
|
|
(84,305)
|
|
Issuance of common
stock
|
56
|
|
—
|
|
1,000
|
|
—
|
|
—
|
|
—
|
|
1,000
|
|
Exercise of options
and restricted stock awards issued
|
396
|
|
1
|
|
5,364
|
|
—
|
|
—
|
|
—
|
|
5,365
|
|
Issuance of common
stock under employee purchase plan
|
25
|
|
—
|
|
458
|
|
—
|
|
—
|
|
—
|
|
458
|
|
Unrealized gain on
available-for-sale securities
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
193
|
|
193
|
|
Foreign currency
translation adjustment
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(102)
|
|
(102)
|
|
Equity-based
compensation
|
—
|
|
—
|
|
12,637
|
|
—
|
|
—
|
|
—
|
|
12,637
|
|
Balances, December
31, 2019
|
54,709
|
|
$
|
55
|
|
$
|
452,344
|
|
$
|
(414,653)
|
|
$
|
(45,067)
|
|
$
|
(58)
|
|
$
|
(7,379)
|
|
|
See accompanying
notes to consolidated financial statements.
|
ACCELERATE
DIAGNOSTICS, INC.
|
CONSOLIDATED
|
STATEMENT OF CASH
FLOWS
|
(in
thousands)
|
|
|
Years Ended
December 31,
|
|
2019
|
2018
|
2017
|
Cash flows from
operating activities:
|
|
|
|
Net loss
|
$
|
(84,305)
|
|
$
|
(88,326)
|
|
$
|
(64,028)
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
Depreciation and
amortization
|
2,602
|
|
2,561
|
|
2,196
|
|
Amortization of
investment discount
|
(427)
|
|
(621)
|
|
326
|
|
Equity-based
compensation expense
|
12,618
|
|
14,422
|
|
13,933
|
|
Amortization of debt
discount and issuance costs
|
9,969
|
|
6,849
|
|
—
|
|
Loss on disposal of
property and equipment
|
837
|
|
678
|
|
240
|
|
(Increase) decrease
in assets:
|
|
|
|
Accounts
receivable
|
(1,362)
|
|
86
|
|
(1,912)
|
|
Inventory
|
(3,655)
|
|
(4,223)
|
|
(7,759)
|
|
Prepaid expense and
other assets
|
(752)
|
|
(250)
|
|
(459)
|
|
Increase (decrease)
in liabilities:
|
|
|
|
Accounts
payable
|
988
|
|
(748)
|
|
1,064
|
|
Accrued
liabilities
|
(1,327)
|
|
1,426
|
|
596
|
|
Accrued
interest
|
—
|
|
1,262
|
|
—
|
|
Deferred revenue and
income
|
54
|
|
(904)
|
|
36
|
|
Deferred
compensation
|
(34)
|
|
32
|
|
21
|
|
Net cash used in
operating activities
|
(64,794)
|
|
(67,756)
|
|
(55,746)
|
|
Cash flows from
investing activities:
|
|
|
|
Purchases of
equipment
|
(330)
|
|
(998)
|
|
(2,966)
|
|
Purchase of
marketable securities
|
(50,226)
|
|
(120,556)
|
|
(82,333)
|
|
Proceeds from sales
of marketable securities
|
14,500
|
|
3,000
|
|
11,522
|
|
Maturities of
marketable securities
|
88,867
|
|
98,416
|
|
48,049
|
|
Net cash provided by
(used in) investing activities
|
52,811
|
|
(20,138)
|
|
(25,728)
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from
issuance of common stock
|
1,458
|
|
583
|
|
83,821
|
|
Proceeds from
exercise of options and warrants
|
5,365
|
|
3,749
|
|
6,606
|
|
Proceeds from
issuance of convertible note
|
—
|
|
171,500
|
|
—
|
|
Prepayment of forward
stock repurchase transaction
|
—
|
|
(45,069)
|
|
—
|
|
Payment of debt
issuance costs
|
—
|
|
(4,992)
|
|
—
|
|
Net cash provided by
financing activities
|
6,823
|
|
125,771
|
|
90,427
|
|
|
|
|
|
Effect of exchange
rate on cash
|
(86)
|
|
(130)
|
|
316
|
|
|
|
|
|
Increase (decrease)
in cash and cash equivalents
|
(5,246)
|
|
37,747
|
|
9,269
|
|
Cash and cash
equivalents, beginning of period
|
66,260
|
|
28,513
|
|
19,244
|
|
Cash and cash
equivalents, end of period
|
$
|
61,014
|
|
$
|
66,260
|
|
$
|
28,513
|
|
|
See accompanying
notes to consolidated financial statements.
|
ACCELERATE
DIAGNOSTICS, INC.
|
CONSOLIDATED
|
STATEMENT OF CASH
FLOWS (CONTINUED)
|
(in
thousands)
|
|
|
Years Ended
December 31,
|
|
2019
|
2018
|
2017
|
Non-cash investing
activities:
|
|
|
|
Transfer of
instruments from inventory to property and equipment
|
$
|
3,361
|
|
$
|
4,767
|
|
$
|
—
|
|
Supplemental cash
flow information:
|
|
|
|
Interest
paid
|
$
|
4,288
|
|
$
|
2,001
|
|
$
|
—
|
|
Income taxes paid,
net of refunds
|
$
|
41
|
|
$
|
651
|
|
$
|
—
|
|
|
See accompanying
notes to consolidated financial statements.
|
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SOURCE Accelerate Diagnostics, Inc.