First Quarter 2011 Highlights
First quarter revenue totaled $13.0 million, an 80% increase
over the same period in 2010
Seven RIO® systems sold in the quarter, increasing domestic
commercial installed base to 74 RIO systems
1,304 MAKOplasty® procedures performed in the quarter, a 78%
increase over the same period in 2010
MAKO Surgical Corp. (Nasdaq:MAKO), a medical device company that
markets both its RIO® Robotic Arm Interactive Orthopedic surgical
platform and proprietary RESTORIS® implants for minimally invasive
orthopedic knee procedures known as knee MAKOplasty®, today
announced its operating results for the quarter ended March 31,
2011.
Recent Business Developments
RIO Systems – Seven RIO systems were installed and customer
accepted at commercial sites during the first quarter, bringing
MAKO's domestic commercial installed base of RIO systems to 74
systems as of March 31, 2011. In the first quarter, MAKO received a
binding commitment for the establishment of eleven new MAKOplasty
sites from Health Management Associates, Inc. (NYSE:HMA), an
operator of acute care hospitals primarily in the southeast and
southwest areas of non-urban America. Two of these RIO systems were
included in the seven systems sold in the first quarter and it is
expected that the remaining RIO systems associated with these
MAKOplasty sites will be installed and customer accepted over the
course of 2011.
MAKOplasty Procedure Volume – During the first quarter, 1,304
MAKOplasty procedures were performed representing a 14% increase
over procedures performed in the fourth quarter of 2010 and a 78%
increase over the first quarter of 2010. Through March 31, 2011, a
total of 7,173 procedures had been performed since the first
procedure in June 2006.
Clinical Research and Marketing – MAKO continues to build its
strong base of clinical evidence with over 60 clinical studies
currently in process. During the first quarter, fifteen abstracts
were submitted to three different conferences for peer-review.
Eight of these abstracts were accepted as podium presentations and
the remaining seven were accepted as posters.
Hip Application Development – The surgeon preference evaluation
of the hip MAKOplasty application is progressing according to plan
and MAKO continues to expect the commercial launch of this product
to occur in the second half of 2011.
"We are pleased with our strong operating results in the first
quarter of 2011 and our team's consistent execution of our
operating and strategic plans," said Maurice R. Ferre, M.D.,
President and Chief Executive Officer of MAKO. "Further, the
significant purchase commitment by HMA in the quarter provides
additional validation of the clinical and economic benefits that
can be achieved through the establishment of a MAKOplasty center of
excellence."
2011 First Quarter Financial Review
Revenue was $13.0 million in the first quarter of 2011 compared
to $7.2 million in the first quarter of 2010, representing an 80%
increase. Revenue in the first quarter of 2011 primarily consisted
of $6.5 million in revenue from the sale of implants and
disposables used in the 1,304 MAKOplasty procedures performed in
the quarter, $5.3 million in revenue from the sale of seven RIO
systems and $1.2 million in service revenue.
Total gross profit for the first quarter of 2011 was $8.9
million compared to a gross profit of $3.3 million in the same
period in 2010. Total gross margin for the first quarter of 2011
was approximately 69%, comprised of a 72% margin on procedure
revenue, a 62% margin on RIO system revenue and a 78% margin on
service revenue.
Operating expenses were $20.0 million in the first quarter of
2011 compared to $14.7 million in the first quarter of 2010. The
increase in operating expenses was primarily attributable to the
following: an increase in sales and marketing activities for the
continued expansion of the direct sales force and commercialization
of the RIO system and RESTORIS implant systems; an increase in
research and development activities associated with continuous
improvement of the RIO system and the development of potential
future products, including the hip MAKOplasty application and
associated implant systems; and an increase in general and
administrative costs as MAKO continued to build infrastructure to
support growth.
Net loss for the three months ended March 31, 2011 was $11.0
million, including non-cash stock-based compensation expense of
$2.3 million, or $(0.27) per basic and diluted share, based on
average basic and diluted shares outstanding of 40.1 million. This
compares to a net loss for the same period in 2010 of $11.4
million, including non-cash stock-based compensation expense of
$1.3 million, or $(0.34) per basic and diluted share, based on
average basic and diluted shares outstanding of 33.2 million.
Cash, cash equivalents and investments were $86.1 million as of
March 31, 2011 compared to $96.8 million as of December 31,
2010.
Conference Call
MAKO will host a conference call today at 4:30 pm ET to discuss
its first quarter 2011 results. To listen to the conference call,
please dial 877-843-0414 for domestic callers and 914-495-8580 for
international callers approximately ten minutes prior to the start
time. The participant code is 60243521. To access the live
audio broadcast or the subsequent archived recording, visit the
Investor Relations section of MAKO's website at
www.makosurgical.com.
About MAKO Surgical Corp. MAKO Surgical Corp.
is a medical device company that markets both its RIO® Robotic-Arm
Interactive Orthopedic system and its proprietary RESTORIS®
implants for minimally invasive orthopedic knee procedures. The
MAKO RIO is a surgeon-interactive tactile surgical platform that
incorporates a robotic arm and patient-specific visualization
technology and prepares the knee joint for the insertion and
alignment of MAKO's resurfacing RESTORIS implants through a minimal
incision. The FDA-cleared and CE Marked RIO system allows surgeons
to provide a precise, consistently reproducible tissue-sparing,
bone resurfacing procedure called MAKOplasty® to a large, yet
underserved patient population suffering from early to mid-stage
osteoarthritic knee disease. The MAKOplasty solution is comprised
of imaging, navigation, surgical procedures, haptics, robotics,
software, instrument and implant technologies and is enabled by an
intellectual property portfolio of more than 300 U.S. and foreign,
owned and licensed, patents and patent applications, as well as
copyrights, trademarks, trade secrets and employee
know-how. Additional information can be found at
www.makosurgical.com.
Forward-Looking Statements
This press release contains forward-looking statements
regarding, among other things, statements related to expectations,
goals, plans, objectives and future events. MAKO intends such
forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in Section 21E
of the Securities Exchange Act of 1934 and the Private Securities
Reform Act of 1995. In some cases, forward-looking statements can
be identified by the following words: "may," "will," "could,"
"would," "should," "expect," "intend," "plan," "anticipate,"
"believe," "estimate," "predict," "project," "potential,"
"continue," "ongoing" or the negative of these terms or other
comparable terminology, although not all forward-looking statements
contain these words. These statements are based on the current
estimates and assumptions of our management as of the date of this
press release and are subject to risks, uncertainties, changes in
circumstances, assumptions and other factors that may cause actual
results to differ materially from those indicated by
forward-looking statements, many of which are beyond MAKO's ability
to control or predict. Such factors, among others, may have a
material adverse effect on MAKO's business, financial condition and
results of operations and may include the potentially significant
impact of a continued economic downturn or delayed economic
recovery on the ability of MAKO's customers to secure adequate
funding, including access to credit, for the purchase of MAKO's
products or cause MAKO's customers to delay a purchasing decision,
changes in competitive conditions and prices in MAKO's markets,
unanticipated issues relating to intended product launches,
decreases in sales of MAKO's principal product lines, increases in
expenditures related to increased or changing governmental
regulation or taxation of MAKO's business, unanticipated issues in
securing regulatory clearance or approvals for new products or
upgrades or changes to MAKO's current products, the impact of the
recently enacted United States healthcare reform legislation on
hospital spending, reimbursement, and the taxing of medical device
companies, loss of key management and other personnel or inability
to attract such management and other personnel and unanticipated
intellectual property expenditures required to develop, market, and
defend MAKO's products. These and other risks are described in
greater detail under Item 1A, "Risk Factors," in MAKO's periodic
filings with the Securities and Exchange Commission, including
MAKO's annual report on Form 10-K for the year ended December 31,
2010 filed on March 10, 2011. Given these uncertainties, undue
reliance should not be placed on these forward-looking statements.
MAKO does not undertake any obligation to release any revisions to
these forward-looking statements publicly to reflect events or
circumstances after the date of this press release or to reflect
the occurrence of unanticipated events.
"MAKOplasty®," "RESTORIS®," and "RIO®," as well as the
"MAKO" logo, whether standing alone or in connection with the words
"MAKO Surgical Corp." are trademarks of MAKO Surgical
Corp.
Condensed Statements of Operations
(unaudited) |
Three Months Ended |
(in thousands, except per share data) |
March 31, |
|
2011 |
2010 |
|
|
|
Revenue: |
|
|
Procedures |
$6,467 |
$3,628 |
Systems – RIO |
5,364 |
3,390 |
Service |
1,195 |
231 |
Total revenue |
13,026 |
7,249 |
Cost of revenue: |
|
|
Procedures |
1,798 |
1,955 |
Systems – RIO |
2,038 |
1,740 |
Service |
259 |
301 |
Total cost of revenue |
4,095 |
3,996 |
Gross profit |
8,931 |
3,253 |
Operating costs and expenses: |
|
|
Selling, general and
administrative |
14,809 |
10,818 |
Research and
development |
4,194 |
3,283 |
Depreciation and
amortization |
975 |
622 |
Total operating costs and expenses |
19,978 |
14,723 |
Loss from operations |
(11,047) |
(11,470) |
Interest and other income |
92 |
108 |
Loss before income taxes |
(10,955) |
(11,362) |
Income tax expense |
40 |
46 |
Net loss |
$(10,995) |
$(11,408) |
Net loss per share - Basic and
diluted |
$(0.27) |
$(0.34) |
Weighted average common shares outstanding -
Basic and diluted |
40,107 |
33,180 |
|
|
|
Selected Balance Sheet Data
(unaudited) |
|
|
(in thousands) |
March 31, |
December 31, |
|
2011 |
2010 |
|
|
|
Cash, cash equivalents and investments |
$86,133 |
$96,792 |
Total assets |
126,409 |
137,079 |
|
|
|
Long-term debt |
― |
― |
Additional paid-in capital |
278,132 |
274,712 |
Accumulated deficit |
(163,877) |
(152,882) |
Total stockholders' equity |
114,170 |
121,771 |
CONTACT: Investors:
MAKO Surgical Corp.
Susan M. Verde
954-628-1706
investorrelations@makosurgical.com
or
Westwicke Partners
Mark Klausner
443-213-0500
makosurgical@westwicke.com
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