Second quarter results impacted by volume
declines; Further progress on the development of the Co-Dx
PCR Home platform
SALT
LAKE CITY, Aug. 11, 2022 /PRNewswire/ --
Co-Diagnostics, Inc. (NASDAQ: CODX), a molecular diagnostics
company with a unique, patented platform for the development of
molecular diagnostic tests, announced today financial results for
the second quarter ended June 30, 2022.
Second Quarter 2022 Financial Results:
- Revenue of $5.0 million, down
from $27.4 million during the prior
year period, due primarily to lower demand of the Logix Smart™
COVID-19 Test
- Gross profit of $4.1 million,
representing 81.8% of consolidated revenue stemming from
inefficiencies in lower sales volumes
- Operating loss of $4.1 million
compared to operating income of $11.8
million a year ago, due to lower sales volumes and continued
investments into research and development
- Net loss of $2.7 million,
compared to a net income of $9.8
million in the prior-year second quarter, representing a
loss of $0.08 per fully diluted
share
- Adjusted EBITDA loss of $2.3
million
- Cash, cash equivalents, and marketable securities of
$96.0 million as of June 30, 2022
- Cash flow from operations of $1.7
million for the second quarter ended June 30, 2022
Dwight Egan, Co-Diagnostics'
Chief Executive Officer, remarked "Our second quarter results
reflect lower volumes for our Logix Smart™ COVID-19 Test, which we
believe is primarily the result of a reduction in mandated testing
in travel and public venues and in government funding for testing
programs. The Company has initiatives underway intended to actively
address these pressures, such as growing our international
distributor network, expanding our infectious disease testing menu
including monkeypox, and most importantly, our upcoming
at-home/point-of-care testing platform. We anticipate these
initiatives will potentially be bolstered by recurring COVID surges
as we have previously experienced."
Mr. Egan further stated that "progress continues in the
development and optimization of the Co-Dx™ PCR Home testing
platform* and its manufacturing capacity to meet the anticipated
demand for gold-standard PCR in at-home and point-of-care settings.
We believe that the need for accurate and reliable COVID-19 testing
will persist as new variants emerge, and we continue to invest time
and resources to meet the evolving demand for COVID-19 and other
infectious diseases globally. We remain confident in our business
strategy and in our unique portfolio of innovative testing products
that extend far beyond COVID-19."
Second Quarter 2022 and Recent
Business Highlights:
- Indian JV CoSara received clearance from Indian regulators for
Hepatitis C viral load test
- Completed principal design for monkeypox virus test and shipped
testing reagents to international distributor
- Announced expansion of its OEM agreement with Bio Molecular
Systems ("BMS") for the Co-Dx Box™ magnetic induction PCR cycler,
to encompass 193 countries worldwide
- Continued optimization of the Co-Dx PCR Home device, which has
been showcased at several tradeshows and conferences
- Initiated previously announced repurchase of shares to return
value to Company shareholders
Conference Call and
Webcast
Co-Diagnostics will host a conference call and webcast at
4:30 p.m. EDT today to discuss its
financial results with analysts and institutional
investors. The conference call and webcast will be available
via:
Webcast: ir.codiagnostics.com on the Events & Webcasts
page
Conference Call: 877-317-6789 (domestic) or 412-317-6789
(international)
The call will be recorded and later made available on the
Company's website: https://codiagnostics.com.
*The Co-Dx PCR Home platform is subject to FDA review and is not
currently for sale.
About Co-Diagnostics,
Inc.:
Co-Diagnostics, Inc., a Utah
corporation, is a molecular diagnostics company that develops,
manufactures and markets new, state-of-the-art diagnostics
technologies. The Company's technology is utilized for tests that
are designed using the detection and/or analysis of nucleic acid
molecules (DNA or RNA). The Company also uses its proprietary
technology to design specific tests to locate genetic markers for
use in industries other than infectious disease and license the use
of those tests to specific customers.
Non-GAAP Financial
Measures:
This press release contains adjusted EBITDA, which is a
non-GAAP measure defined as net income excluding depreciation,
amortization, income tax (benefit) expense, net interest (income)
expense, stock-based compensation, and one-time transaction related
costs. The Company believes that adjusted EBITDA provides useful
information to management and investors relating to its results of
operations. The Company's management uses this non-GAAP measure to
compare the Company's performance to that of prior periods for
trend analyses, and for budgeting and planning purposes. The
Company believes that the use of adjusted EBITDA provides an
additional tool for investors to use in evaluating ongoing
operating results and trends and in comparing the Company's
financial measures with other companies, many of which present
similar non-GAAP financial measures to investors, and that it
allows for greater transparency with respect to key metrics used by
management in its financial and operational
decision-making.
Management does not consider the non-GAAP measure in
isolation or as an alternative to financial measures determined in
accordance with GAAP. The principal limitation of the non-GAAP
financial measure is that it excludes significant expenses that are
required by GAAP to be recorded in the Company's financial
statements. In order to compensate for these limitations,
management presents the non-GAAP financial measure together with
GAAP results. Non-GAAP measures should be considered in addition to
results prepared in accordance with GAAP, but should not be
considered a substitute for, or superior to, GAAP results. A
reconciliation tables of the net income, the most comparable GAAP
financial measure to adjusted EBITDA, is included at the end of
this release. The Company urges investors to review the
reconciliation and not to rely on any single financial measure to
evaluate the company's business.
Forward-Looking
Statements:
This press release contains forward-looking statements.
Forward-looking statements can be identified by words such as
"believes," "expects," "estimates," "intends," "may," "plans,"
"will" and similar expressions, or the negative of these words.
Such forward-looking statements are based on facts and conditions
as they exist at the time such statements are made and predictions
as to future facts and conditions. Forward-looking statements in
this release include statements regarding (i) completion of
development and FDA submission for approval of the new Co-Dx
at-home/point-of-care PCR testing device, (ii) that there will be
recurring COVID surges, and (iii) our confidence that the need for
accurate and reliable COVID-19 testing will persist as new variants
emerge. Forward-looking statements are subject to inherent
uncertainties, risks and changes in circumstances. Actual results
may differ materially from those contemplated or anticipated by
such forward-looking statements. Readers of this press release are
cautioned not to place undue reliance on any forward-looking
statements. There can be no assurance that any of the anticipated
results will occur on a timely basis or at all due to certain risks
and uncertainties, a discussion of which can be found in our Risk
Factors disclosure in our Annual Report on Form 10-K, filed with
the Securities and Exchange Commission (SEC) on March 24, 2022, and in our other filings with the
SEC. The Company does not undertake any obligation to update any
forward-looking statement relating to matters discussed in this
press release, except as may be required by applicable securities
laws.
CO-DIAGNOSTICS,
INC. AND SUBSIDIARIES
CONSOLIDATED
BALANCE SHEETS
(Unaudited)
|
|
|
|
June 30,
2022
|
|
|
December 31,
2021
|
|
Assets
|
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
86,045,405
|
|
|
$
|
88,607,234
|
|
Marketable investment
securities
|
|
|
9,951,550
|
|
|
|
1,255,266
|
|
Accounts receivable,
net
|
|
|
12,260,009
|
|
|
|
20,839,182
|
|
Inventory
|
|
|
4,705,921
|
|
|
|
2,004,169
|
|
Prepaid expenses and
other current assets
|
|
|
1,569,374
|
|
|
|
2,338,444
|
|
Note
receivable
|
|
|
35,200
|
|
|
|
75,000
|
|
Total current
assets
|
|
|
114,567,459
|
|
|
|
115,119,295
|
|
Property and equipment,
net
|
|
|
2,421,349
|
|
|
|
1,933,216
|
|
Operating lease
right-of-use asset
|
|
|
530,033
|
|
|
|
-
|
|
Goodwill
|
|
|
15,388,546
|
|
|
|
14,706,818
|
|
Intangible assets,
net
|
|
|
26,981,667
|
|
|
|
27,195,000
|
|
Investment in joint
venture
|
|
|
877,089
|
|
|
|
1,004,953
|
|
Note
receivable
|
|
|
75,000
|
|
|
|
75,000
|
|
Total assets
|
|
$
|
160,841,143
|
|
|
$
|
160,034,282
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
848,379
|
|
|
$
|
607,506
|
|
Accrued expenses,
current
|
|
|
1,818,773
|
|
|
|
3,859,652
|
|
Operating lease
liability, current
|
|
|
287,900
|
|
|
|
-
|
|
Contingent
consideration liabilities, current
|
|
|
3,761,084
|
|
|
|
5,767,304
|
|
Income taxes
payable
|
|
|
-
|
|
|
|
2,213,088
|
|
Deferred
revenue
|
|
|
-
|
|
|
|
150,000
|
|
Total current
liabilities
|
|
|
6,716,136
|
|
|
|
12,597,550
|
|
Long-term
liabilities
|
|
|
|
|
|
|
|
|
Income taxes
payable
|
|
|
1,464,024
|
|
|
|
1,067,853
|
|
Deferred tax
liability
|
|
|
5,310,573
|
|
|
|
7,228,444
|
|
Operating lease
liability
|
|
|
201,266
|
|
|
|
-
|
|
Contingent
consideration liabilities
|
|
|
2,678,204
|
|
|
|
4,665,337
|
|
Total long-term
liabilities
|
|
|
9,654,067
|
|
|
|
12,961,634
|
|
Total
liabilities
|
|
|
16,370,203
|
|
|
|
25,559,184
|
|
Commitments and
contingencies (Note 12)
|
|
|
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
|
|
|
|
Convertible preferred
stock, $0.001 par value; 5,000,000 shares authorized; 0 shares
issued and outstanding as of June 30, 2022 and December 31, 2021,
respectively
|
|
|
-
|
|
|
|
-
|
|
Common stock, $0.001
par value; 100,000,000 shares authorized; 34,313,432 shares issued
and 33,780,992 shares outstanding as of June 30, 2022 and
33,819,862 shares issued and outstanding as of December 31,
2021
|
|
|
34,313
|
|
|
|
33,820
|
|
Treasury stock, at
cost; 532,440 and 0 shares held as of June 30, 2022 and December
31, 2021, respectively
|
|
|
(2,599,478)
|
|
|
|
-
|
|
Additional paid-in
capital
|
|
|
83,838,533
|
|
|
|
80,271,999
|
|
Accumulated
earnings
|
|
|
63,197,572
|
|
|
|
54,169,279
|
|
Total stockholders'
equity
|
|
|
144,470,940
|
|
|
|
134,475,098
|
|
Total liabilities and
stockholders' equity
|
|
$
|
160,841,143
|
|
|
$
|
160,034,282
|
|
CO-DIAGNOSTICS,
INC. AND SUBSIDIARIES
CONSOLIDATED
STATEMENTS OF OPERATIONS
(Unaudited)
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
Revenue
|
|
$
|
5,023,226
|
|
|
$
|
27,358,140
|
|
|
$
|
27,722,270
|
|
|
$
|
47,382,909
|
|
Cost of
revenue
|
|
|
915,432
|
|
|
|
2,504,355
|
|
|
|
4,197,383
|
|
|
|
5,776,920
|
|
Gross profit
|
|
|
4,107,794
|
|
|
|
24,853,785
|
|
|
|
23,524,887
|
|
|
|
41,605,989
|
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
|
|
1,472,225
|
|
|
|
5,853,313
|
|
|
|
4,124,373
|
|
|
|
7,050,859
|
|
General and
administrative
|
|
|
2,468,421
|
|
|
|
2,468,433
|
|
|
|
5,390,616
|
|
|
|
5,404,122
|
|
Research and
development
|
|
|
3,889,844
|
|
|
|
4,669,160
|
|
|
|
7,661,171
|
|
|
|
6,886,223
|
|
Depreciation and
amortization
|
|
|
424,342
|
|
|
|
71,714
|
|
|
|
671,606
|
|
|
|
138,719
|
|
Total operating
expenses
|
|
|
8,254,832
|
|
|
|
13,062,620
|
|
|
|
17,847,766
|
|
|
|
19,479,923
|
|
Income from
operations
|
|
|
(4,147,038)
|
|
|
|
11,791,165
|
|
|
|
5,677,121
|
|
|
|
22,126,066
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income
|
|
|
61,671
|
|
|
|
10,529
|
|
|
|
73,064
|
|
|
|
25,186
|
|
(Loss) on disposition
of assets
|
|
|
(48,740)
|
|
|
|
-
|
|
|
|
(142,161)
|
|
|
|
-
|
|
Gain on remeasurement
of acquisition contingencies
|
|
|
812,822
|
|
|
|
-
|
|
|
|
4,192,712
|
|
|
|
-
|
|
Gain (loss) on equity
method investment in joint venture
|
|
|
(106,525)
|
|
|
|
128,595
|
|
|
|
(127,864)
|
|
|
|
(336,348)
|
|
Total other income
(expense)
|
|
|
719,228
|
|
|
|
139,124
|
|
|
|
3,995,751
|
|
|
|
(311,162)
|
|
Income (loss) before
income taxes
|
|
|
(3,427,810)
|
|
|
|
11,930,289
|
|
|
|
9,672,872
|
|
|
|
21,814,904
|
|
Income tax
provision
|
|
|
(741,507)
|
|
|
|
2,145,076
|
|
|
|
644,580
|
|
|
|
4,130,716
|
|
Net income
(loss)
|
|
$
|
(2,686,303)
|
|
|
$
|
9,785,213
|
|
|
$
|
9,028,292
|
|
|
$
|
17,684,188
|
|
Earnings per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(0.08)
|
|
|
$
|
0.34
|
|
|
$
|
0.27
|
|
|
$
|
0.62
|
|
Diluted
|
|
$
|
(0.08)
|
|
|
$
|
0.33
|
|
|
$
|
0.26
|
|
|
$
|
0.59
|
|
Weighted average shares
outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
33,472,251
|
|
|
|
28,794,047
|
|
|
|
32,509,664
|
|
|
|
28,728,828
|
|
Diluted
|
|
|
33,472,251
|
|
|
|
29,741,265
|
|
|
|
33,253,612
|
|
|
|
29,833,955
|
|
CO-DIAGNOSTICS, INC.
AND SUBSIDIARIES
GAAP AND NON-GAAP
MEASURES
(Unaudited)
|
|
Reconciliation of
net income to adjusted EBITDA:
|
|
|
|
Three Months Ended
June 30,
|
|
|
Six Months Ended
June 30,
|
|
|
|
2022
|
|
|
2021
|
|
|
2022
|
|
|
2021
|
|
Net income
|
|
$
|
(2,686,303)
|
|
|
$
|
9,785,213
|
|
|
$
|
9,028,292
|
|
|
$
|
17,684,188
|
|
Interest
income
|
|
|
(61,671)
|
|
|
|
(10,529)
|
|
|
|
(73,064)
|
|
|
|
(25,186)
|
|
Depreciation and
amortization
|
|
|
424,342
|
|
|
|
71,714
|
|
|
|
671,606
|
|
|
|
138,719
|
|
Transaction
costs
|
|
|
47,943
|
|
|
|
-
|
|
|
|
126,171
|
|
|
|
-
|
|
Change in fair value of
contingent consideration
|
|
|
(812,822)
|
|
|
|
-
|
|
|
|
(4,192,712)
|
|
|
|
-
|
|
Stock-based
compensation expense
|
|
|
1,533,286
|
|
|
|
927,338
|
|
|
|
2,908,381
|
|
|
|
2,440,347
|
|
Income tax
provision
|
|
|
(741,507)
|
|
|
|
2,145,076
|
|
|
|
644,580
|
|
|
|
4,130,716
|
|
Adjusted
EBITDA
|
|
$
|
(2,296,732)
|
|
|
$
|
12,918,812
|
|
|
$
|
9,113,254
|
|
|
$
|
24,368,784
|
|
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SOURCE Co-Diagnostics