RANCHO CORDOVA, Calif.,
Nov. 14, 2018 /PRNewswire/ -- Cesca Therapeutics Inc.
(NASDAQ: KOOL), a market leader in automated cell processing and
point-of-care, autologous cell-based therapies, today announced
financial and operating results for the third quarter ended
September 30, 2018 and provided a
corporate update.
Third Quarter and Recent Highlights
- Undertook additional cost-cutting measures in support of
management's goal to become cash flow positive in 2019.
- Achieved third quarter 2018 net revenues of $3.1 million, up approximately 55% compared with
$2.0 million in the second quarter of
2018 -- reflecting ongoing adoption and sales of the CAR-TXpress™
product line.
- Launched the PXP™ system for the rapid processing of autologous
bone marrow cells in point-of-care settings, which further
solidified our positioning as a leading innovator in the field of
cellular processing.
- Submitted a Device Master File (MAF) to the U.S. Food and Drug
Administration in October, for X-Lab® cartridges, in order to
support clinical development using the X-Lab device.
- Presented new data at the 4th Annual CAR-TCR Summit
in Boston, further illustrating
the benefits of Cesca's proprietary Buoyancy-Activated Cell Sorting
(BACS) technology versus manual cell processing systems.
"We are encouraged by the strong interest we are receiving for
our CAR-TXpress cellular processing platform and associated
X-Series™ product line and see the level of initial sales we have
achieved without a dedicated sales force as a positive sign for
long-term product reception. Since use of each X-Series instrument
results in associated cartridge sales, the system provides Cesca
with an important razor-razorblade revenue model. Given the level
of inbound interest we are receiving from academia, research
institutions and industry, we anticipate a steady increase in our
customer base," noted Chris Xu,
Ph.D., chief executive officer of Cesca.
"The first nine months of the year were marked by tangible
internal progress at Cesca, with the launch of key products
including the AXP® II for clinical biobanking, our point-of-care
PXP system for automated processing of bone marrow cells, and the
introduction of the X-Series product line. This level of activity
has come with some growing pains, but the cost-cutting measures we
have undertaken should put us on a path to achieving cash flow
positive status in 2019, which will put us on firmer ground to hit
our longer-term goals. In the meantime, we are focused on expanding
our footprint in the cell therapy market through sales of existing
products and new, planned launches. Moving forward, we expect to
realize additional milestones as we progress toward our goal of
becoming the 'partner of choice' for CAR-T researchers and
manufacturers who face an increasingly urgent need to automate key
parts of the CAR-T manufacturing process in order to deliver these
important new therapies to patients," concluded Dr. Xu.
Financial Results for the Third Quarter Ended September 30, 2018
Net revenue. Net revenues for the three months ended
September 30, 2018 increased
slightly, to $3.1 million compared
with $3.07 million for the comparable
period in 2017. The increase in net revenues was driven primarily
by new customer adoption of the Company's CAR-TXpress products.
Gross profit. Gross profit for the three months ended
September 30, 2018 was $655,000, or 21% of net revenue, compared with
$931,000, or 30% of net revenue, for
the comparable period in 2017. The decrease in gross profit,
year-over-year, was driven primarily by higher overhead costs and
lower overhead absorption due to reduced procurement.
Sales and marketing expenses. Sales and marketing
expenses for the three months ended September 30, 2018 were $364,000 compared with $517,000 for the comparable period in 2017. The
decrease was due to reduced consultant fees subsequent to
completing the integration of SynGen's operations.
Research and development expenses. Research and
development expenses for the three months ended September 30, 2018 were $611,000, compared with $1.1 million for the comparable period in 2017.
The decrease was driven primarily by a reduction in personnel costs
as a result of the June 2018
reduction in force.
General and administrative expenses. General and
administrative expenses for the three months ended September 30, 2018 declined to $1.6 million from $1.7
million a year ago, due primarily to fees associated with
the June 30, 2017 audit incurred in
the quarter ended September 30, 2017.
As the Company has transitioned to a December 31 year end, there was no audit
performed as of June 30, 2018.
Net loss attributable to common stockholders. For the
three months ended September 30,
2018, the Company reported a comprehensive loss attributable
to common stockholders of $2.6
million, or $0.12 per share,
based on approximately 22.1 million weighted average basic and
diluted common shares outstanding. This compares to a net loss of
$2.3 million, or $0.24 per share, based on approximately 9.9
million weighted average basic and diluted common shares
outstanding for prior year period.
Cash and Cash Equivalents. At September 30, 2018, cash and equivalents totaled
$2.2 million compared with
$3.5 million, and working capital was
$3.6 million, compared with
$6.0 million at December 31, 2017. On August 28, the Company completed a private
placement of 1,000,000 shares of the Company's common stock, par
value $0.001 per share for a purchase
price of $0.18 per share and
2,965,000 pre-funded warrants for a purchase price of $0.17 per pre-funded warrant. Each
pre-funded warrant is immediately exercisable for one share of
common stock at an exercise price of $0.01 per share and will remain exercisable until
exercised in full. The Company received net proceeds of
$623,000 after deducting offering
expenses. As of September 30,
2018, none of the pre-funded warrants issued in the
August 2018 private placement had
been exercised.
Conference Call and Webcast Information
Cesca will
host a conference call and audio webcast today at 4:30 p.m. EST (1:30 p.m.
PST). Participants may access the call by dialing
1-844-889-4331 within the U.S. or 1-412-380-7406 outside the U.S.
and referencing "Cesca." To access a live webcast of the call,
please visit: https://services.choruscall.com/links/kool181113.html
A replay of the call can be accessed approximately one hour after
completion of the call and will be available until December 4, 2018. To listen to the replay, dial
1-877-344-7529 within the U.S. or 1-412-317-0088 outside the U.S.
and reference access code 10125285.
About Cesca Therapeutics Inc.
Cesca Therapeutics
develops, commercializes and markets a range of automated
technologies for CAR-T and other cell-based therapies. Its device
division, ThermoGenesis, provides a full suite of solutions for
automated clinical biobanking, point-of-care applications, and
automation for immuno-oncology. The Company has launched an
automated, functionally-closed CAR-TXpress platform that addresses
the critical unmet need for better cellular manufacturing and
controls (CMC) for the emerging CAR-T immunotherapy market.
Forward-Looking Statement
The statements contained
herein may include statements of future expectations and other
forward-looking statements that are based on management's current
views and assumptions and involve known and unknown risks and
uncertainties that could cause actual results, performance or
events to differ materially from those expressed or implied in such
statements. A more complete description of risks that could cause
actual events to differ from the outcomes predicted by Cesca
Therapeutics' forward-looking statements is set forth under the
caption "Risk Factors" in Cesca Therapeutics' annual report on Form
10-K and other reports it files with the Securities and Exchange
Commission from time to time, and you should consider each of those
factors when evaluating the forward-looking statements.
Company Contact:
Cesca Therapeutics Inc.
Wendy Samford
916-858-5191
ir@cescatherapeutics.com
Investor Contact:
Rx Communications
Paula Schwartz
917-322-2216
pschwartz@rxir.com
Cesca Therapeutics
Inc.
Condensed
Consolidated Balance Sheets
(Unaudited)
|
|
|
|
|
|
|
|
September
30,
2018
|
|
December
31,
2017
|
|
|
(Unaudited)
|
|
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
Cash and
cash equivalents
|
|
$2,220,000
|
|
$3,513,000
|
Accounts
receivable, net
|
|
2,090,000
|
|
2,549,000
|
Inventories
|
|
4,332,000
|
|
4,798,000
|
Prepaid
expenses and other current assets
|
|
286,000
|
|
594,000
|
|
|
|
|
|
Total current assets
|
|
8,928,000
|
|
11,454,000
|
|
|
|
|
|
Restricted
cash
|
|
1,000,000
|
|
1,000,000
|
Equipment,
net
|
|
3,343,000
|
|
2,996,000
|
Goodwill
|
|
1,281,000
|
|
13,976,000
|
Intangible assets,
net
|
|
6,996,000
|
|
21,629,000
|
Other
assets
|
|
51,000
|
|
56,000
|
|
|
|
|
|
Total assets
|
|
$21,599,000
|
|
$51,111,000
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$1,784,000
|
|
$2,079,000
|
Other
current liabilities
|
|
3,517,000
|
|
3,385,000
|
Total current liabilities
|
|
5,301,000
|
|
5,464,000
|
|
|
|
|
|
Long-term
liabilities
|
|
2,428,000
|
|
12,435,000
|
Total liabilities
|
|
7,729,000
|
|
17,899,000
|
|
|
|
|
|
Cesca Therapeutics
Inc. stockholders' equity
|
|
15,445,000
|
|
33,699,000
|
|
|
|
|
|
Noncontrolling
interests
|
|
(1,575,000)
|
|
(487,000)
|
|
|
|
|
|
Total liabilities and stockholders' equity
|
|
$21,599,000
|
|
$51,111,000
|
Cesca Therapeutics
Inc.
Condensed
Consolidated Statements of Operations
(Unaudited)
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September
30,
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
Net
revenues
|
$3,113,000
|
|
$3,069,000
|
|
$6,984,000
|
|
$9,822,000
|
|
|
|
|
|
|
|
|
Cost of
revenues
|
2,458,000
|
|
2,138,000
|
|
5,614,000
|
|
5,986,000
|
|
|
|
|
|
|
|
|
Gross profit
|
655,000
|
|
931,000
|
|
1,370,000
|
|
3,836,000
|
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
|
|
Sales
and marketing
|
364,000
|
|
517,000
|
|
1,048,000
|
|
1,273,000
|
|
|
|
|
|
|
|
|
Research
and development
|
611,000
|
|
1,063,000
|
|
2,560,000
|
|
2,196,000
|
|
|
|
|
|
|
|
|
General
and administration
|
1,615,000
|
|
1,701,000
|
|
6,256,000
|
|
6,302,000
|
|
|
|
|
|
|
|
|
Impairment Charges
|
--
|
|
--
|
|
27,202,000
|
|
310,000
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
2,590,000
|
|
3,281,000
|
|
37,066,000
|
|
10,081,000
|
|
|
|
|
|
|
|
|
Loss from
operations
|
(1,935,000)
|
|
(2,350,000)
|
|
(35,696,000)
|
|
(6,245,000)
|
|
|
|
|
|
|
|
|
Fair value change of
derivative instruments
|
24,000
|
|
(13,000)
|
|
591,000
|
|
100,000
|
Interest
expense
|
(835,000)
|
|
(198,000)
|
|
(1,928,000)
|
|
(329,000)
|
Other
(expenses)
|
(18,000)
|
|
(26,000)
|
|
(63,000)
|
|
(37,000)
|
Total other expenses
|
(829,000)
|
|
(237,000)
|
|
(1,400,000)
|
|
(266,000)
|
|
|
|
|
|
|
|
|
Loss before benefit
for income taxes
|
(2,764,000)
|
|
(2,587,000)
|
|
(37,096,000)
|
|
(6,511,000)
|
Benefit for income
taxes
|
--
|
|
--
|
|
3,451,000
|
|
673,000
|
Net loss
|
(2,764,000)
|
|
(2,587,000)
|
|
(33,645,000)
|
|
(5,838,000)
|
|
|
|
|
|
|
|
|
Loss attributable to
noncontrolling interests
|
(175,000)
|
|
(237,000)
|
|
(1,088,000)
|
|
(237,000)
|
|
|
|
|
|
|
|
|
Net loss attributable
to common stockholders
|
$(2,589,000)
|
|
$(2,350,000)
|
|
$(32,557,000)
|
|
$(5,601,000)
|
|
|
|
|
|
|
|
|
Cesca Therapeutics
Inc.
Condensed
Consolidated Statements of Cash Flows
(Unaudited)
|
|
|
|
Nine Months
Ended
September
30,
|
|
2018
|
|
2017
|
Cash flows from
operating activities:
|
|
|
|
Net
cash used in operating activities
|
$(7,431,000)
|
|
$(6,095,000)
|
|
|
|
|
Cash flows from
investing activities:
|
|
|
|
Cash paid for business
acquisition
|
--
|
|
(1,000,000)
|
Capital
expenditures
|
(985,000)
|
|
(239,000)
|
Net cash
used in investing activities
|
(985,000)
|
|
(1,239,000)
|
|
|
|
|
Cash flows from
financing activities:
|
|
|
|
Payments on capital lease
obligations
|
(28,000)
|
|
(42,000)
|
Proceeds from issuance of
common stock and warrants, net
|
6,655,000
|
|
--
|
Proceeds from convertible
promissory note-related party
|
500,000
|
|
5,000,000
|
Payment of financing
cost
|
--
|
|
(13,000)
|
Cash paid for taxes on
vested stock
|
--
|
|
(51,000)
|
|
|
|
|
Net
cash provided by financing activities
|
7,127,000
|
|
4,894,000
|
|
|
|
|
Effects of foreign
currency rate changes on cash and cash equivalents
|
(4,000)
|
|
5,000
|
Net decrease in cash,
cash equivalents and restricted cash
|
(1,293,000)
|
|
(2,435,000)
|
|
|
|
|
Cash and cash
equivalents at beginning of period
|
3,513,000
|
|
4,899,000
|
Cash and cash
equivalents at end of period
|
$2,220,000
|
|
$2,464,000
|
|
|
|
|
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SOURCE Cesca Therapeutics Inc.