Invuity Reports 2016 Third Quarter, Nine-Month Financial Results
November 03 2016 - 4:01PM
Updates 2016 revenue guidance and introduces 2017
revenue guidanceReceived FDA 510(k) clearance for PhotonBlade™
Invuity, Inc. (NASDAQ:IVTY), a leading surgical photonics company,
today reported financial results for the third quarter and
nine-months ended September 30, 2016.
Q3 2016 Highlights
- Revenue grew 52% to $8.5 million compared to revenue of $5.6
million in the 2015 third quarter.
- Gross margin expansion continued to 73.8% compared to 63.6% in
the 2015 third quarter.
- Approximately 700 hospitals purchased Invuity devices in the
third quarter of 2016, up from 465 hospitals in the third quarter
of 2015.
- Approximately 212,000 procedures have been performed using
Invuity devices.
- Received FDA 510(k) clearance for PhotonBlade, a novel device
that integrates Intelligent Photonics™ technology into our
high-value advanced energy device used for cutting and coagulation
of soft-tissue during surgical procedures.
"While we achieved 52% revenue growth in the third
quarter, results were lower than our expectations due to
seasonality and lower than anticipated revenue per account.
Although we have moderated our near-term growth expectations, we
remain quite confident in the long-term growth prospects of the
business,” said President and CEO Philip Sawyer. “On the
product development front, we are thrilled that the FDA has cleared
our PhotonBlade technology. PhotonBlade is a major milestone
for Invuity as we continue to execute on our strategy to leverage
our expertise in advanced photonics into the development of novel
high value medical devices for use in minimal access surgery.”
Financial Results
Revenue was $8.5 million in the third quarter of
2016, up 52% from revenue of $5.6 million in the third quarter of
2015 driven by an increase in active accounts.
For the first nine months of 2016, revenue was
$23.1 million, up 56% from revenue of $14.8 million in the first
nine months of 2015.
Gross margin for the third quarter and first nine
months of 2016 was 73.8% and 72.2%, respectively, compared to 63.6%
and 62.1% for the same periods in 2015. Gross margin expansion has
been helped by the introduction of our non-conductive polymer based
retractors, and by overhead efficiencies created as a result of
increased sales volumes.
Total operating expenses for the third quarter and
first nine months of 2016 were $14.6 million and $46.3 million,
respectively, compared to $12.2 million and $34.8 million in the
prior year periods. The increase in operating expenses is due to
investment in our commercial platform. This is consistent with our
stated objectives of increasing the size of our sales force and
accelerating our product development efforts.
The net loss for the third quarter of 2016 was $8.8
million, or $0.56 loss per share, compared to a net loss of $9.1
million, or $0.69 loss per share, for the third quarter of 2015.
The net loss for the first nine months of 2016 was $31.1 million,
or $2.19 loss per share, compared to $27.5 million, or $4.84 loss
per share, for the first nine months of 2015.
The Company's balance sheet as of September 30,
2016, showed total cash and cash equivalents of $47.7 million.
PhotonBlade
In September the Company received Food and Drug
Administration 510(k) clearance for PhotonBlade, a single use
device that integrates the Company’s proprietary Intelligent
Photonics™ technology into our high value advanced energy device
used for cutting and coagulation of soft-tissue during general
surgical procedures. PhotonBlade’s novel energy platform,
developed by Invuity, consists of a proprietary shielded blade for
precise cutting and coagulation of tissue, with minimal collateral
effect, while the integrated Photonics delivers directed, thermally
cool illumination at the precise point of surgical treatment.
This ground breaking combination of illumination and advanced
energy enables low thermal damage, vascularity preservation and use
in a wet surgical field with superior visualization thus improving
surgical efficiency and outcomes.
Business Outlook
Invuity now expects revenue for 2016 to range from
$32 million to $32.5 million, as compared to prior guidance of $35
million to $37 million. Our current guidance represents annual
growth of approximately 50% over 2015.
The Company is introducing revenue guidance for
2017 in the range of $42 million to $44 million.
Conference Call
Invuity's management will discuss the Company's
financial results for the third quarter ended September 30, 2016,
and provide a general business update during a conference call
beginning at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time today,
November 3, 2016. To join the live call, participants may dial
1-877-556-8638 (U.S.) or 1-615-247-0174 (International), Conference
ID: 969511601. To listen to the live call via Invuity's
website, go to www.invuity.com, in the Events & Presentations
section. A webcast replay of the call will be available following
the conclusion of the call for a period of 90 days in the Events
& Presentations section of the website.
About Invuity®
Invuity, Inc. is a medical technology company
focused on developing and marketing advanced photonics devices to
improve the ability of surgeons to illuminate and visualize the
surgical cavity during open minimally invasive and minimal access
surgery. The company's patented Intelligent Photonics™ technology
enables enhanced surgical precision, efficiency and safety by
providing superior visualization. Clinical applications include
breast and thyroid oncology, plastic reconstructive, spine,
orthopedic, cardiothoracic and general surgery among others.
Invuity is headquartered in San Francisco, CA. For more
information, visit www.invuity.com.
Forward-Looking Statements
This announcement contains forward-looking
statements that involve risks and uncertainties, including
statements regarding financial results and future product
introductions. Actual results could differ materially from those
projected in the forward-looking statements as a result of certain
risk factors, including, but not limited to: fluctuations in demand
or failure to gain market acceptance for the Company's devices; the
Company's ability to demonstrate to and gain approval from
hospitals to use the Company's devices; the highly competitive
business environment for surgical medical devices; the Company's
ability to sell its devices at prices that support its current
business strategies; difficulty forecasting future financial
performance; protection of the Company's intellectual property; and
compliance with necessary regulatory clearances or approvals. The
Company undertakes no obligation to update the forward-looking
information in this release. More information about potential
factors that could affect the Company's business and financial
results is included in its filings with the Securities and Exchange
Commission, including, without limitation, under the captions:
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," and "Risk Factors," which are on file with
the Securities and Exchange Commission.
INVUITY, INC. |
Condensed Statements of
Operations |
(In thousands, except share and per share
amounts) |
(Unaudited) |
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
|
|
|
2016 |
|
2015 |
|
2016 |
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
|
8,478 |
|
|
$ |
|
5,595 |
|
|
$ |
|
23,106 |
|
|
$ |
|
14,784 |
|
|
Cost of goods sold |
|
|
|
2,219 |
|
|
|
|
2,035 |
|
|
|
|
6,416 |
|
|
|
|
5,605 |
|
|
Gross profit |
|
|
|
6,259 |
|
|
|
|
3,560 |
|
|
|
|
16,690 |
|
|
|
|
9,179 |
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
|
2,471 |
|
|
|
|
2,042 |
|
|
|
|
7,412 |
|
|
|
|
5,799 |
|
|
Selling, general and
administrative |
|
|
|
12,134 |
|
|
|
|
10,180 |
|
|
|
|
38,885 |
|
|
|
|
29,020 |
|
|
Total operating expenses |
|
|
|
14,605 |
|
|
|
|
12,222 |
|
|
|
|
46,297 |
|
|
|
|
34,819 |
|
|
Loss from
operations |
|
|
|
(8,346 |
) |
|
|
|
(8,662 |
) |
|
|
|
(29,607 |
) |
|
|
|
(25,640 |
) |
|
Interest expense |
|
|
|
(505 |
) |
|
|
|
(504 |
) |
|
|
|
(1,514 |
) |
|
|
|
(1,377 |
) |
|
Interest and other
income (expense), net |
|
|
|
30 |
|
|
|
|
28 |
|
|
|
|
61 |
|
|
|
|
(499 |
) |
|
Net loss and
comprehensive loss |
|
$ |
|
(8,821 |
) |
|
$ |
|
(9,138 |
) |
|
$ |
|
(31,060 |
) |
|
$ |
|
(27,516 |
) |
|
Net loss per common
share, basic and diluted |
|
$ |
|
(0.56 |
) |
|
$ |
|
(0.69 |
) |
|
$ |
|
(2.19 |
) |
|
$ |
|
(4.84 |
) |
|
Weighted-average shares
used to compute net loss per common share, basic and diluted |
|
|
|
15,690,785 |
|
|
|
|
13,292,849 |
|
|
|
|
14,173,534 |
|
|
|
|
5,684,755 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet |
as of September 30, 2016 and December 31,
2015 |
(In thousands, except share and per share
amounts) |
(Unaudited) |
|
|
|
September 30, |
|
December 31, |
|
|
|
2016 |
|
2015 |
|
Assets |
|
|
|
|
|
|
|
Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
|
47,709 |
|
|
$ |
|
46,296 |
|
|
Accounts receivable, net |
|
|
|
5,149 |
|
|
|
|
3,619 |
|
|
Inventory |
|
|
|
5,120 |
|
|
|
|
5,182 |
|
|
Prepaid expenses and other current
assets |
|
|
|
952 |
|
|
|
|
923 |
|
|
Total current assets |
|
|
|
58,930 |
|
|
|
|
56,020 |
|
|
Restricted cash |
|
|
|
1,090 |
|
|
|
|
1,090 |
|
|
Property and equipment, net |
|
|
|
8,538 |
|
|
|
|
9,195 |
|
|
Other non-current assets |
|
|
|
170 |
|
|
|
— |
|
|
Total assets |
|
$ |
|
68,728 |
|
|
$ |
|
66,305 |
|
|
Liabilities,
Convertible Preferred Stock and Stockholders’ Equity |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
Accounts payable |
|
$ |
|
2,800 |
|
|
$ |
|
2,458 |
|
|
Accrued and other current
liabilities |
|
|
|
5,283 |
|
|
|
|
4,214 |
|
|
Short-term debt—related party |
|
|
|
1,125 |
|
|
|
— |
|
|
Total current liabilities |
|
|
|
9,208 |
|
|
|
|
6,672 |
|
|
Deferred rent |
|
|
|
2,751 |
|
|
|
|
2,810 |
|
|
Long-term debt—related
party |
|
|
|
13,462 |
|
|
|
|
14,480 |
|
|
Total liabilities |
|
|
|
25,421 |
|
|
|
|
23,962 |
|
|
Commitments and contingencies |
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
|
|
|
|
Preferred stock, $0.001 par
value—10,000,000 shares authorized at
September 30, 2016 and December 31, 2015,
respectively; no shares issued and outstanding at
September 30, 2016 and December 31, 2015,
respectively |
|
|
— |
|
|
|
— |
|
|
Common stock, $0.001 par
value—100,000,000 shares authorized at
September 30, 2016 and December 31, 2015,
respectively; 16,905,103 and 13,392,358 shares issued and
outstanding at September 30, 2016 and
December 31, 2015, respectively |
|
|
|
14 |
|
|
|
|
13 |
|
|
Additional paid-in capital |
|
|
|
179,960 |
|
|
|
|
147,937 |
|
|
Accumulated deficit |
|
|
|
(136,667 |
) |
|
|
|
(105,607 |
) |
|
Total stockholders’
equity |
|
|
|
43,307 |
|
|
|
|
42,343 |
|
|
Total liabilities,
convertible preferred stock and stockholders’ equity |
|
$ |
|
68,728 |
|
|
$ |
|
66,305 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CONTACT:
Company Contact:
Jim Mackaness
Chief Financial Officer
Invuity, Inc.
415-655-2129
Investors:
Mark Klausner
Westwicke Partners
443-213-0501
irdept@invuity.com
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