Itamar Medical Ltd. (Nasdaq and TASE: ITMR), a leading medical
device and digital health company focused on the integration of
sleep apnea management into the cardiac patient care pathway, today
reported unaudited financial results for the first quarter of 2021.
“We were pleased to see the momentum from the second half of
2020 continue into new year, enabling us to achieve record first
quarter revenue. Our U.S. core sleep business was once again the
primary growth driver as home-based care continued to drive
adoption and our Cardiology tests reached all-time high,” said
Gilad Glick, President and Chief Executive Officer. “Overall,
demand for WatchPAT is increasing worldwide, reflecting positive
reception to our paradigm-shifting technology. Even as COVID
restrictions began lifting, providing an opportunity for PSG
testing in sleep centers to return, our sales remained strong.”
“Itamar has a number of exciting catalysts ahead and
importantly, we have a significantly strengthened balance sheet in
place to deliver on these initiatives. Our team remains focused on
driving global market share, advancing our product portfolio, and
pursuing additional in-organic growth opportunities,” concluded
Glick.
First Quarter 2021 Highlights and Recent
Achievements
- Total revenues were $12.0 million, an increase of 43%
year-over-year.
- U.S. WatchPAT revenues were $8.4 million, an increase of 38%
year-over-year.
- Gained a total of 725 WatchPAT ONE customers since April 1,
2020, after continuing to onboard approximately 32 new WatchPAT ONE
customers per month on average throughout the first quarter.
- Non-IFRS gross margin was 72%, compared to 71% in the fourth
quarter of 2020 and 77% in the first quarter of 2020. (See “Use of
Non-IFRS Measures” below).
- IFRS operating expenses include $1.1 million relating to
non-recurring share-based payments resulting from the extended
exercise period of vested service options from five to ten
years.
- Announced the expected launch of three additions to the
Company’s WatchPAT product line at the upcoming SLEEP 2021
meeting.
First Quarter 2021 Financial
Results
Revenues increased 43% to $12.0 million, compared to $8.4
million in the same quarter in 2020. Revenue growth was mainly
driven by an increase in WatchPAT sales in the U.S., and the
increase in total sales in Japan and Europe.
WatchPAT revenues increased 33% to $10.9 million, compared to
$8.2 million in the same quarter in 2020.
U.S. WatchPAT revenues increased 38% to $8.4 million, compared
to $6.1 million in the same quarter in 2020, driven primarily by
WatchPAT ONE sales, as well as WatchPAT Direct sales. Sales from
disposables and renewable products, including WatchPAT ONE,
comprised approximately 79% of WatchPAT revenues in the U.S. in the
first quarter of 2021, compared to 75% in the same quarter in
2020.
Gross profit increased to $8.0 million, compared to $6.3 million
in the same quarter in 2020. Gross margin decreased to 67%,
compared to 76% in the same quarter in 2020. Gross margin decline
was mainly driven by the increase in WatchPAT ONE sales, as well as
non-recurring expenses of $0.4 million related to relocating the
Company’s production facilities to a new location during the first
quarter of 2021. Non-IFRS gross margin (see “Reconciliation of IFRS
to Non-IFRS Financial Measures” below) decreased to 72%, compared
to 77% in the same quarter in 2020. Non-IFRS gross margin decline
was mainly driven by the increase in WatchPAT ONE sales. (See “Use
of Non-IFRS Measures” below).
Operating loss was $5.3 million, compared to $2.0 million in the
same quarter in 2020. The increase in operating loss was primarily
due to an increase in operating expenses, partially offset by the
increase in revenues. Operating expense increase was mainly driven
by the following:
- |
$1.1 million relating to non-recurring share-based payments
resulting from the extension of the exercise period of vested
service options from five to ten years. |
|
|
- |
Selling and marketing expenses increased 39% to $7.3 million,
compared to $5.3 million in the same quarter in 2020, due to the
planned expansion of the U.S. sales team into new geographical
territories and verticals (37 territories and verticals as of March
31, 2021, compared to 32 territories and verticals as of March 31,
2020), as well as additional sales commissions resulting from the
increase in revenues, increase in consulting fees relating to
reimbursement in the U.S., Australia and Japan, and an increase in
share-based payments, as mentioned above. |
|
|
- |
Research and development expenses increased 122% to $2.9 million,
compared to $1.3 million in the same quarter in 2020, driven by
expenses of $0.8 million associated with research and development
of the Remote Patient Monitoring or RPM technology (including
amortization of intangible assets of $0.3 million) associated with
the Spry acquisition, an increase in personnel to support product
development, mainly related to our digital health platform, and an
increase in share-based payments, as mentioned above. |
|
|
- |
General and administrative expenses increased 80% to $3.1 million,
compared to $1.7 million in the same quarter in 2020, mainly driven
by an increase in directors’ and officers’ insurance premium, as
well as increased legal expenses, including a commercial dispute in
defense of our intellectual property initiated by the Company, and
an increase in share-based payments, as mentioned above. |
Non-IFRS operating loss (see “Reconciliation of IFRS to Non-IFRS
Financial Measures” below) for the first quarter of 2021 was $2.8
million, compared to $1.4 million in the same quarter in 2020.
Non-IFRS operating loss excludes approximately $2.5 million in
share-based payments; depreciation and amortization of property and
equipment and intangible assets; change in provision for doubtful
and bad debt; and non-recurring expenses related to relocating our
production facilities to a new location, compared to a total of
$0.6 million of similar expenses for the same quarter in 2020. (See
“Use of Non-IFRS Measures” below).
Net loss for the first quarter of 2021 was $5.5 million,
compared to $2.0 million in the same quarter in 2020.
Non-IFRS net loss (see “Reconciliation of IFRS to Non-IFRS
Financial Measures” below) for the first quarter of 2021 was $3.0
million, compared to $1.4 million in the same quarter in 2020.
Non-IFRS net loss excludes approximately $2.5 million in
share-based payments; depreciation and amortization of property and
equipment and intangible assets; change in provision for doubtful
and bad debt; and non-recurring expenses related to relocating the
Company’s production facilities to a new location, compared to a
total of $0.6 million of similar expenses for the same quarter in
2020. (See “Use of Non-IFRS Measures” below).
Loss per ADS (basic and diluted) for the first quarter of 2021
was $0.36 compared to $0.15 in the same quarter in 2020. Non-IFRS
loss per ADS (basic and diluted) (see “Reconciliation of IFRS to
Non-IFRS Financial Measures” below) for the first quarter of 2021
was $0.20, compared to $0.11 in the same quarter in 2020. (See “Use
of Non-IFRS Measures” below).
As of March 31, 2021, the Company had cash, cash
equivalents and short-term bank deposits of $78.9 million.
Guidance
Full year 2021 revenue is still expected to be in the range of
$52 to $53 million, representing growth of 27% to 29% over full
year 2020 revenue.
Lease Agreement - Caesarea Headquarters
The Company entered into a new lease agreement, replacing the
current agreement, for the lease of approximately 12,500 square
feet of office space, as of January 1, 2022, for the Company’s
headquarters, research, development and sales offices, in the
Northern Caesarea Business Park, Caesarea, Israel.
Conference Call and Webcast Information
The Company will host a conference call today at 8:00 a.m.
Eastern Time, 3:00 p.m. Israel Time to review financial results and
provide a corporate update.
To listen live via webcast, please visit
https://www.itamar-medical.com/, or by clicking here.
To participate via phone, please use the dial in
information:
U.S. toll-free: 833-519-1272International: 914-800-3844Israel
toll-free: 1-809-315-362Conference ID: 9398218
Please log in approximately 10 minutes prior to the scheduled
start time. An archived webcast also will be provided in the Events
and Presentations section of the Company’s website.
Use of Non-IFRS Measures
In addition to disclosing financial results prepared in
accordance with International Financial Reporting Standards (IFRS)
as issued by the International Accounting Standard Board (IASB),
this press release contains Non-IFRS financial measures for
operating loss and net loss, which are adjusted from results based
on IFRS to exclude: (i) share-based payments; (ii) depreciation and
amortization of property and equipment and intangible assets; (iii)
change in provision for doubtful and bad debt; and (iv)
non-recurring expenses related to relocating production facilities
to a new location. Management believes that the Non-IFRS financial
measures provided in this press release are useful to investors’
understanding and assessment of the Company’s performance.
Management uses both IFRS and Non-IFRS measures when operating and
evaluating the Company’s business internally and therefore decided
to make these Non-IFRS adjustments available to investors. The
presentation of this Non-IFRS financial information is not intended
to be considered in isolation or as a substitute for the financial
information prepared and presented in accordance with IFRS. For
further details, see a reconciliation of operating loss and net
loss on an IFRS basis to a Non-IFRS basis that is provided in the
table that accompanies this press release.
About Itamar Medical Ltd.
Itamar Medical is a medical technology company focused on the
development and commercialization of non-invasive medical devices
and solutions to aid in the diagnosis of respiratory sleep
disorders. Itamar Medical commercializes a digital healthcare
platform to facilitate the continuum of care for effective sleep
apnea management with a focus on the core sleep, cardiology and
direct to consumer markets. Itamar Medical offers a Total Sleep
Solution to help physicians provide comprehensive sleep apnea
management in a variety of clinical environments to optimize
patient care and reduce healthcare system costs. The Company’s key
product, WatchPAT, is commercially available within major markets
including the U.S., Japan and Europe. Itamar Medical is a public
company traded on the Nasdaq and on the Tel Aviv Stock Exchanges,
and is based in Caesarea, Israel with U.S. headquarters based in
Atlanta, GA. For additional information visit
www.itamar-medical.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the “safe harbor” provisions of the Private
Securities Litigation Reform Act of 1995 and other applicable
securities laws. Statements preceded by, followed by, or that
otherwise include the words “believes”, “expects”, “anticipates”,
“intends”, “estimates”, “plans”, and similar expressions or future
or conditional verbs such as “will”, “should”, “would”, “may” and
“could” are generally forward-looking in nature and not historical
facts. For example, when we discuss the 2021 revenue guidance
range, we are using forward-looking statements. Because such
statements deal with future events, they are subject to various
risks, uncertainties and assumptions, including events and
circumstances out of Itamar Medical’s control and actual results,
expressed or implied by such forward-looking statements, could
differ materially from Itamar Medical’s current expectations.
Factors that could cause or contribute to such differences include,
but are not limited to, risks, uncertainties and assumptions
discussed from time to time by Itamar Medical in reports filed
with, or furnished to, the U.S. Securities and Exchange Commission
(SEC) and the Israel Securities Authority (ISA), including the
Company’s Annual Report on Form 20-F to be filed with the SEC,
which is on file with the SEC (accessible at www.sec.gov) and the
ISA. Except as otherwise required by law, Itamar Medical undertakes
no obligation to publicly release any revisions to these
forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated
events.
Itamar Medical Investor Relations Contact
(U.S.)Leigh SalvoGilmartin GroupPhone:
+1-415-937-5412investors@itamar-medical.com
* The contents of any website or hyperlinks mentioned in this
press release are for informational purposes and the contents
thereof are not part of this press release.
ITAMAR MEDICAL
LTD.CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL
POSITION (Unaudited)
|
|
March 31,2021 |
|
|
December 31, 2020 |
|
|
|
|
|
|
|
|
|
|
U.S. dollars in thousands |
|
Assets |
|
|
|
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
51,869 |
|
|
$ |
9,670 |
|
Short-term bank deposits |
|
|
27,000 |
|
|
|
30,000 |
|
Trade receivables |
|
|
8,269 |
|
|
|
8,354 |
|
Other receivables |
|
|
2,693 |
|
|
|
2,251 |
|
Inventories |
|
|
7,146 |
|
|
|
7,164 |
|
Total current assets |
|
|
96,977 |
|
|
|
57,439 |
|
|
|
|
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
|
|
Long-term restricted deposits
and prepaid expenses |
|
|
563 |
|
|
|
547 |
|
Long-term trade
receivables |
|
|
278 |
|
|
|
412 |
|
Property and equipment |
|
|
3,245 |
|
|
|
2,904 |
|
Intangible assets |
|
|
3,206 |
|
|
|
1,037 |
|
Right-of-use assets |
|
|
1,554 |
|
|
|
1,801 |
|
Total non-current assets |
|
|
8,846 |
|
|
|
6,701 |
|
Total assets |
|
$ |
105,823 |
|
|
$ |
64,140 |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
|
|
Short-term bank loan |
|
$ |
5,000 |
|
|
$ |
5,000 |
|
Current maturities of
long-term loan |
|
|
135 |
|
|
|
135 |
|
Current maturities of lease
liabilities |
|
|
665 |
|
|
|
700 |
|
Trade payables |
|
|
4,499 |
|
|
|
4,418 |
|
Other payables |
|
|
4,266 |
|
|
|
5,973 |
|
Accrued expenses |
|
|
1,726 |
|
|
|
1,091 |
|
Provisions |
|
|
333 |
|
|
|
321 |
|
Short-term employee
benefits |
|
|
613 |
|
|
|
354 |
|
Total current liabilities |
|
|
17,237 |
|
|
|
17,992 |
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities |
|
|
|
|
|
|
|
|
Long-term loan |
|
|
117 |
|
|
|
154 |
|
Long-term lease
liabilities |
|
|
1,106 |
|
|
|
1,380 |
|
Recognized liability for
defined benefit plan, net |
|
|
261 |
|
|
|
271 |
|
Other long-term
liabilities |
|
|
1,271 |
|
|
|
1,271 |
|
Total non-current liabilities |
|
|
2,755 |
|
|
|
3,076 |
|
Total liabilities |
|
|
19,992 |
|
|
|
21,068 |
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
Ordinary share capital |
|
|
1,340 |
|
|
|
1,140 |
|
Additional paid-in
capital |
|
|
207,469 |
|
|
|
161,006 |
|
Accumulated deficit |
|
|
(122,978 |
) |
|
|
(119,074 |
) |
Total equity |
|
|
85,831 |
|
|
|
43,072 |
|
Total liabilities and equity |
|
$ |
105,823 |
|
|
$ |
64,140 |
|
ITAMAR MEDICAL
LTD.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS(Unaudited)
|
|
Three Months Ended March 31, |
|
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
U.S. dollars in thousands (exceptper share
and ADS data) |
|
|
|
|
|
|
|
|
|
|
Revenues |
|
$ |
11,977 |
|
|
$ |
8,378 |
|
Cost of revenues |
|
|
3,968 |
|
|
|
2,050 |
|
Gross
profit |
|
|
8,009 |
|
|
|
6,328 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Selling and marketing |
|
|
7,325 |
|
|
|
5,263 |
|
Research and development |
|
|
2,889 |
|
|
|
1,302 |
|
General and
administrative |
|
|
3,091 |
|
|
|
1,720 |
|
Total operating
expenses |
|
|
13,305 |
|
|
|
8,285 |
|
Operating
loss |
|
|
(5,296 |
) |
|
|
(1,957 |
) |
Financial income
(expenses): |
|
|
|
|
|
|
|
|
Financial income |
|
|
146 |
|
|
|
235 |
|
Financial expenses |
|
|
(327 |
) |
|
|
(234 |
) |
Financial income
(expenses), net |
|
|
(181 |
) |
|
|
1 |
|
Loss before taxes on
income |
|
|
(5,477 |
) |
|
|
(1,956 |
) |
Taxes on income |
|
|
(46 |
) |
|
|
(42 |
) |
Net loss |
|
$ |
(5,523 |
) |
|
$ |
(1,998 |
) |
|
|
|
|
|
|
|
|
|
Loss per share – basic
and diluted (in U.S. dollars) |
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computation of loss per shares – basic and
diluted (in thousands) |
|
|
463,250 |
|
|
|
389,927 |
|
|
|
|
|
|
|
|
|
|
Loss per ADS – basic
and diluted (in U.S. dollars) |
|
$ |
(0.36 |
) |
|
$ |
(0.15 |
) |
|
|
|
|
|
|
|
|
|
Weighted average
number of ADSs used in computation of loss per ADS – basic and
diluted (in thousands) |
|
|
15,442 |
|
|
|
12,998 |
|
ITAMAR MEDICAL
LTD.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS(Unaudited)
|
|
Three Months Ended March 31, |
|
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
U.S. dollars in thousands |
|
Cash flows from operating activities |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(5,523 |
) |
|
$ |
(1,998 |
) |
Adjustments for: |
|
|
|
|
|
|
|
|
Depreciation and
amortization |
|
|
758 |
|
|
|
410 |
|
Share-based payment |
|
|
1,620 |
|
|
|
362 |
|
Change in provision for
doubtful and bad debt |
|
|
(3 |
) |
|
|
32 |
|
Net financial cost
(income) |
|
|
167 |
|
|
|
(97 |
) |
Decrease in trade
receivables |
|
|
222 |
|
|
|
1,184 |
|
Decrease (increase) in other
receivables |
|
|
(469 |
) |
|
|
228 |
|
Increase in inventories |
|
|
(133 |
) |
|
|
(761 |
) |
Increase in trade
payables |
|
|
95 |
|
|
|
429 |
|
Decrease in other
payables |
|
|
(1,718 |
) |
|
|
(1,292 |
) |
Increase in provisions |
|
|
12 |
|
|
|
51 |
|
Increase in employee
benefits |
|
|
249 |
|
|
|
79 |
|
Income tax expenses |
|
|
46 |
|
|
|
42 |
|
Taxes paid during the
period |
|
|
(16 |
) |
|
|
(1 |
) |
Interest paid during the
period |
|
|
(159 |
) |
|
|
(147 |
) |
Interest received during the
period |
|
|
54 |
|
|
|
73 |
|
Net cash used in
operating activities |
|
|
(4,798 |
) |
|
|
(1,406 |
) |
Cash flows from
investing activities |
|
|
|
|
|
|
|
|
Redemption of short-term bank
deposits |
|
|
3,000 |
|
|
|
- |
|
Purchase of property and
equipment, intangible assets, and capitalization of development
expenditure |
|
|
(2,274 |
) |
|
|
(231 |
) |
Net cash provided by
(used in) investing activities |
|
|
726 |
|
|
|
(231 |
) |
Cash flows from
financing activities |
|
|
|
|
|
|
|
|
Proceeds from issuance of
shares, net of share issuance costs |
|
|
46,660 |
|
|
|
37,061 |
|
Repayment of principal of
lease liabilities |
|
|
(248 |
) |
|
|
(225 |
) |
Repayment of long-term
loan |
|
|
(33 |
) |
|
|
- |
|
Issuance of shares due to the
exercise of stock options |
|
|
4 |
|
|
|
- |
|
Net cash provided by
financing activities |
|
|
46,383 |
|
|
|
36,836 |
|
Increase in cash and
cash equivalents |
|
|
42,311 |
|
|
|
35,199 |
|
Cash and cash
equivalents at beginning of period |
|
|
9,670 |
|
|
|
15,115 |
|
Effect of exchange
rate fluctuations on balances of cash and cash
equivalents |
|
|
(112 |
) |
|
|
128 |
|
Cash and cash
equivalent balance at end of period |
|
$ |
51,869 |
|
|
$ |
50,442 |
|
|
|
|
|
|
|
|
|
|
Non-cash investing
activity – acquisition of intangible assets |
|
$ |
600 |
|
|
$ |
- |
|
Non-cash financing
activity – share issuance costs |
|
$ |
- |
|
|
$ |
511 |
|
ITAMAR MEDICAL
LTD.RECONCILIATIONS OF IFRS TO NON-IFRS FINANCIAL
MEASURES (Unaudited)
|
|
Three Months Ended March 31, |
|
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
|
|
U.S. dollars in thousands (except per ADS
data) |
|
|
|
|
|
|
|
|
|
|
IFRS operating
loss |
|
$ |
(5,296 |
) |
|
$ |
(1,957 |
) |
IFRS net
loss |
|
$ |
(5,523 |
) |
|
$ |
(1,998 |
) |
|
|
|
|
|
|
|
|
|
Cost of
revenues: |
|
|
|
|
|
|
|
|
Share-based payment |
|
|
43 |
|
|
|
2 |
|
Depreciation and amortization
of property and equipment and intangible assets |
|
|
165 |
|
|
|
102 |
|
Non-recurring expenses related
to relocating the Company’s production facilities to a new
location |
|
|
376 |
|
|
|
- |
|
|
|
|
584 |
|
|
|
104 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Selling and marketing: |
|
|
|
|
|
|
|
|
Share-based payment |
|
|
643 |
|
|
|
119 |
|
Depreciation and amortization
of property and equipment and intangible assets |
|
|
34 |
|
|
|
31 |
|
|
|
|
677 |
|
|
|
150 |
|
Research and development: |
|
|
|
|
|
|
|
|
Share-based payment |
|
|
327 |
|
|
|
71 |
|
Depreciation and amortization
of property and equipment and intangible assets |
|
|
294 |
|
|
|
19 |
|
|
|
|
621 |
|
|
|
90 |
|
General and
administrative: |
|
|
|
|
|
|
|
|
Share-based payment |
|
|
607 |
|
|
|
164 |
|
Depreciation and amortization
of property and equipment and intangible assets |
|
|
23 |
|
|
|
16 |
|
Change in provision for
doubtful and bad debt |
|
|
(3 |
) |
|
|
32 |
|
|
|
|
627 |
|
|
|
212 |
|
Financial income
(expenses), net: |
|
|
|
|
|
|
|
|
Share-based payment |
|
|
- |
|
|
|
6 |
|
|
|
|
- |
|
|
|
6 |
|
|
|
|
|
|
|
|
|
|
Non-IFRS operating
loss |
|
$ |
(2,787 |
) |
|
$ |
(1,401 |
) |
Non-IFRS net
loss |
|
$ |
(3,014 |
) |
|
$ |
(1,436 |
) |
|
|
|
|
|
|
|
|
|
IFRS loss per ADS –
basic and diluted (in U.S. dollars) |
|
$ |
(0.36 |
) |
|
$ |
(0.15 |
) |
|
|
|
|
|
|
|
|
|
Non-IFRS loss per ADS
– basic and diluted (in U.S. dollars) |
|
$ |
(0.20 |
) |
|
$ |
(0.11 |
) |
Itamar Medical (NASDAQ:ITMR)
Historical Stock Chart
From Mar 2024 to Apr 2024
Itamar Medical (NASDAQ:ITMR)
Historical Stock Chart
From Apr 2023 to Apr 2024