Science 37 Holdings, Inc. (Nasdaq: SNCE), (“Science 37”) the Agile
Clinical Trial Operating System™, today reported its financial
results for the quarter and full year ended December 31, 2021.
“Our impressive financial performance in the fourth quarter and
for the full year 2021 reflects our team’s continued strong
execution and commitment to expanding patient access and reach of
our agile clinical trial offerings,” said David Coman, Chief
Executive Officer of Science 37. “As we look ahead to 2022, we
expect a sustained market shift toward more decentralization and
strong demand for our differentiated Operating System. We are on a
clear pathway to growth and long-term profitability as we redefine
the future of clinical research; and we are confident that we are
well positioned to deliver on our objectives.”
Quarterly Financial Highlights
- Revenue was $20.4 million for the quarter ended December 31,
2021, an 83% increase compared to the same period in 2020.
- Net bookings were $43.2 million for the quarter ended December
31, 2021, a 102% increase compared to the same period in 2020.
- Adjusted Gross Profit(1) was $4.7 million for the quarter ended
December 31, 2021, compared to $(0.5) million for the same period
in 2020. Adjusted Gross Margin was 23.2% for the quarter ended
December 31, 2021, compared to (4.5%) percent for the same period
in the prior year.
- Net loss was $65.1 million for the quarter ended December 31,
2021, resulting in diluted earnings per share of $(0.60), compared
to a net loss of $12.3 million in the same period in 2020, or
diluted earnings per share of $(0.91).
- Adjusted Net Loss(1) was $24.4 million for the quarter ended
December 31, 2021, compared to an Adjusted Net Loss of $12.2
million in the same period in 2020.
- Adjusted EBITDA(1) was $(21.5) million for the quarter ended
December 31, 2021, compared to $(10.9) million in the same period
in 2020.
Annual Financial Highlights
- Revenue was $59.6 million for the year ended December 31, 2021,
a 151% increase compared to the same period in 2020.
- Net bookings were $163.9 million for the year ended December
31, 2021, a 194% increase compared to the same period in 2020.
- Adjusted Gross Profit(1) was $18.0 million for the year ended
December 31, 2021, compared to $1.0 million for the same period in
2020. Adjusted Gross Margin was 30.3% for the year ended December
31, 2021, compared to 4.4% for the same period in the prior
year.
- Net loss was $94.3 million for the year ended December 31,
2021, resulting in diluted earnings per share of $(2.89), compared
to a net loss of $31.7 million in the same period in 2020, or
diluted earnings per share of $(2.13).
- Adjusted Net Loss(1) was $52.1 million for the year ended
December 31, 2021, compared to an Adjusted Net Loss of $31.6
million in the same period in 2020.
- Adjusted EBITDA(1) was $(44.1) million for the year ended
December 31, 2021, compared to $(27.0) million in the same period
in 2020.
(1) Adjusted Gross Profit, Adjusted Net Loss and Adjusted EBITDA
are non-GAAP financial measures. For a reconciliation to the most
directly comparable GAAP measure, refer to tables at the end of
this press release.
Full Year 2022 Financial Outlook
Science 37 is providing guidance for the calendar year ending
December 31, 2022 for total revenues between $86 and $96
million.
The foregoing 2022 Financial Outlook statements represent
management's current estimates as of the date of this release.
Actual results may differ materially depending on a number of
factors. Investors are urged to read the Cautionary Note Regarding
Forward-Looking Statements included in this release. Management
does not assume any obligation to update these estimates.
Webcast and Conference Call Details
Science 37 will host a conference call today, March 22, 2022, at
8:00 a.m. ET to discuss its quarter and year ended December 31,
2021 financial results. The conference call can be accessed live by
dialing (844) 467-7754 for domestic callers or (270) 215-9366 for
international callers and referring to Conference ID: 7188650. A
live webcast of the conference call will be available on the
“Investor Relations” section of the Company's website at
https://investors.science37.com/. An archived copy of the webcast
will be available on the website after the call.
About Science 37
Science 37’s mission is to enable universal access to clinical
research—making it easier for patients and providers to participate
from anywhere and helping to accelerate the development of
treatments that impact patient lives. As a pioneer of agile
clinical trials, the Science 37 Clinical Trial Operating System
(OS) supports today’s more agile clinical research designs with its
full stack, end-to-end technology platform and specialized networks
of patient communities, telemedicine investigators, mobile nurses,
remote coordinators and connected devices. Configurable to enable
any study type, the Science 37 OS enables up to 15x faster
enrollment, 28% better retention and 3x more people of color, as
compared to the traditional site-centric clinical trial model, with
industry-leading workflow orchestration, evidence generation and
data harmonization. For more information, visit
https://www.science37.com.
Cautionary Note Regarding Forward-Looking
Statements
This press release contains certain forward-looking statements
within the meaning of the federal securities laws, including
statements regarding the services offered by Science 37 and the
markets in which it operates, and Science 37’s anticipated growth,
projected future results, and revenue guidance for fiscal year
2022. These forward-looking statements generally are identified by
the words “believe,” “project,” “expect,” “anticipate,” “estimate,”
“intend,” “strategy,” “future,” “opportunity,” “plan,” “may,”
“should,” “will,” “would,” “will be,” “will continue,” “will likely
result” and similar expressions. Forward-looking statements are
predictions, projections and other statements about future events
that are based on current expectations and assumptions and, as a
result, are subject to risks and uncertainties. Many factors could
cause actual future events to differ materially from the
forward-looking statements in this press release, including but not
limited to: (i) the ability to maintain the listing of Science 37’s
securities on Nasdaq, (ii) volatility in the price of Science 37’s
securities due to a variety of factors, including changes in the
competitive and highly regulated industries in which Science 37
operates, variations in performance across competitors, changes in
laws and regulations affecting Science 37’s business and changes in
its capital structure, (iii) the ability to implement business
plans, forecasts, and other expectations, and to identify and
realize additional opportunities, (iv) the risk that Science 37 may
never achieve or sustain profitability, (v) the risk that Science
37 will need to raise additional capital to execute its business
plan, which may not be available on acceptable terms or at all, and
(vi) the potential adverse effects of the ongoing global COVID-19
pandemic. The foregoing list of factors is not exhaustive. You
should carefully consider the foregoing factors and the other risks
and uncertainties described in the “Risk Factors” section of our
Annual Report on Form 10-K for the year ended December 31, 2021
filed with the U.S. Securities and Exchange Commission (the “SEC”)
on March 22, 2022 and other documents filed by Science 37 from time
to time with the SEC. These filings identify and address other
important risks and uncertainties that could cause actual events
and results to differ materially from those contained in the
forward-looking statements. Forward-looking statements speak only
as of the date they are made. Readers are cautioned not to put
undue reliance on forward-looking statements, and Science 37
assumes no obligation and does not intend to update or revise these
forward-looking statements, whether as a result of new information,
future events, or otherwise, except as required by law. Science 37
does not give any assurance that Science 37 will achieve its
expectations.
Use of Non-GAAP Financial Measures and Key Performance
Measures
In addition to the financial measures prepared in accordance
with U.S. Generally Accepted Accounting Principles ("GAAP"), this
press release contains certain non-GAAP financial measures,
including Adjusted Gross Profit, Adjusted EBITDA and Adjusted Net
Income (loss). A “non-GAAP financial measure” is generally defined
as a numerical measure of a company’s financial performance that
excludes or includes amounts from the most directly comparable
measure calculated and presented in accordance with GAAP in the
statements of operations, balance sheets, or statements of cash
flows of the Company. Please refer to the reconciliations of the
non-GAAP financial measures to their most directly comparable GAAP
measures included in this press release and the accompanying tables
contained at the end of this release.
The Company defines Adjusted Gross Profit as Gross Profit
excluding share-based compensation expense.
The Company defines Adjusted Net Income (including adjusted
diluted earnings per share) as net income (including diluted
earnings per share) excluding transactions that the Company
believes are not representative of its core operations, namely:
restructuring and other costs; transaction and integration-related
expenses; share-based compensation expense; other income (expense),
net; and gain or loss on extinguishment of debt.
EBITDA represents earnings before interest, taxes, depreciation,
and amortization. The Company defines Adjusted EBITDA as EBITDA,
further adjusted to exclude expenses and transactions that the
Company believes are not representative of its core operations,
namely: restructuring and other costs; transaction and
integration-related expenses; share-based compensation expense;
other income (expense), net; and gain or loss on extinguishment of
debt.
Each of the non-GAAP measures noted above are used by management
and the Board to evaluate the Company's core operating results
because they exclude certain items whose fluctuations from
period-to-period do not necessarily correspond to changes in the
core operations of the business.
Management believes that Adjusted Gross Profit, Adjusted EBITDA
and Adjusted Net Income (Loss) are helpful to investors, analysts,
and other interested parties because they can assist in providing a
more consistent and comparable overview of our operations across
our historical periods. In addition, these measures are frequently
used by analysts, investors, and other interested parties to
evaluate and assess performance.
Non-GAAP measures have limitations in that they do not reflect
all of the amounts associated with the Company's results of
operations as determined in accordance with GAAP. Also, other
companies might calculate these measures differently.
This press release also contains certain key performance
measures which we use to evaluate our business and results, measure
performance, identify trends, formulate plans and make strategic
decisions. We believe that the presentation of such metrics is
useful to the Company’s investors because they are used to measure
and model the performance of companies such as ours. Net bookings
represent new business awards, net of contract modifications,
contract cancellations, and other adjustments. Net bookings
represent the minimum contractual value for the initial planned
duration of a contract as of the contract execution date. The
minimum fixed fees, upfront implementation fees and technology and
support fees are included in net bookings. Estimates of variable
revenue for utilization in excess of the contracted amounts is not
included in the value of net bookings. Net bookings vary from
period to period depending on numerous factors, including customer
authorization volume, sales performance and the overall health of
the life sciences industry, among others.
Contacts:
INVESTOR RELATIONS:Caroline PaulGilmartin
Groupinvestors@science37.com
MEDIA INQUIRIES:Margie KoomanScience 37Phone:
(984) 377-3737Email: pr@science37.com
SCIENCE 37 HOLDINGS,
INC.CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE LOSS(In thousands, except share and
per share data)
|
Three Months EndedDecember
31, |
|
Year EndedDecember 31, |
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
Revenues (including amounts
with related parties) |
$ |
20,376 |
|
|
$ |
11,163 |
|
|
$ |
59,597 |
|
|
$ |
23,704 |
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
Cost of revenues (including amounts with related parties) |
|
16,148 |
|
|
|
11,668 |
|
|
|
42,394 |
|
|
|
22,597 |
|
Selling, general and administrative |
|
35,646 |
|
|
|
10,481 |
|
|
|
73,122 |
|
|
|
28,351 |
|
Depreciation and amortization |
|
2,610 |
|
|
|
1,284 |
|
|
|
7,799 |
|
|
|
4,447 |
|
Restructuring Costs |
|
— |
|
|
|
72 |
|
|
|
— |
|
|
|
772 |
|
Total operating expenses |
|
54,404 |
|
|
|
23,505 |
|
|
|
123,315 |
|
|
|
56,167 |
|
|
|
|
|
|
|
|
|
Loss from operations |
|
(34,028 |
) |
|
|
(12,342 |
) |
|
|
(63,718 |
) |
|
|
(32,463 |
) |
|
|
|
|
|
|
|
|
Other income (expense): |
|
|
|
|
|
|
|
Interest income |
|
1 |
|
|
|
1 |
|
|
|
3 |
|
|
|
77 |
|
Sublease income (including amounts with related parties) |
|
241 |
|
|
|
12 |
|
|
|
685 |
|
|
|
709 |
|
Change in fair value of earn-out liability |
|
(31,300 |
) |
|
|
— |
|
|
|
(31,300 |
) |
|
|
— |
|
Other income (expense) |
|
(12 |
) |
|
|
5 |
|
|
|
— |
|
|
|
3 |
|
Total other income
(expense) |
|
(31,070 |
) |
|
|
18 |
|
|
|
(30,612 |
) |
|
|
789 |
|
Loss before income taxes |
|
(65,098 |
) |
|
|
(12,324 |
) |
|
|
(94,330 |
) |
|
|
(31,674 |
) |
Income tax expense |
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
Net loss and comprehensive
loss |
$ |
(65,099 |
) |
|
$ |
(12,324 |
) |
|
$ |
(94,331 |
) |
|
$ |
(31,674 |
) |
|
|
|
|
|
|
|
|
Net loss per share: |
|
|
|
|
|
|
|
Basic and diluted |
$ |
(0.60 |
) |
|
$ |
(0.91 |
) |
|
$ |
(2.89 |
) |
|
$ |
(2.13 |
) |
|
|
|
|
|
|
|
|
Weighted average common shares
outstanding: |
|
|
|
|
|
|
|
Weighted average shares used
to compute basic and diluted net loss per share |
|
109,100,582 |
|
|
|
13,473,103 |
|
|
|
32,679,105 |
|
|
|
14,869,184 |
|
SCIENCE 37 HOLDINGS,
INC.CONSOLIDATED BALANCE
SHEETS(In thousands, except share
data)
|
December 31, |
|
|
2021 |
|
|
|
2020 |
|
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
214,601 |
|
|
$ |
32,479 |
|
Restricted cash |
|
— |
|
|
|
1,004 |
|
Accounts receivable and unbilled services, net (including amounts
with related parties) |
|
10,699 |
|
|
|
11,200 |
|
Prepaid expenses and other current assets |
|
7,403 |
|
|
|
1,365 |
|
Total current assets |
|
232,703 |
|
|
|
46,048 |
|
Property and equipment,
net |
|
1,393 |
|
|
|
535 |
|
Operating lease right-of-use
assets |
|
2,086 |
|
|
|
2,210 |
|
Capitalized software, net |
|
24,290 |
|
|
|
8,054 |
|
Other assets |
|
326 |
|
|
|
184 |
|
Total assets |
$ |
260,798 |
|
|
$ |
57,031 |
|
Liabilities,
redeemable convertible preferred stock and stockholders’ equity
(deficit) |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
12,819 |
|
|
$ |
4,402 |
|
Accrued expenses and other liabilities |
|
17,073 |
|
|
|
8,763 |
|
Deferred revenue |
|
5,130 |
|
|
|
5,136 |
|
Total current liabilities |
|
35,022 |
|
|
|
18,301 |
|
Long-term liabilities: |
|
|
|
Long-term deferred revenue |
|
2,478 |
|
|
|
428 |
|
Operating lease liabilities |
|
1,322 |
|
|
|
1,128 |
|
Other long-term liabilities |
|
1,477 |
|
|
|
223 |
|
Long-term earn-out liability |
|
98,900 |
|
|
|
— |
|
Total liabilities |
|
139,199 |
|
|
|
20,080 |
|
|
|
|
|
Redeemable convertible
preferred stock: |
|
|
|
Redeemable convertible preferred stock, $0.0001 par value;
100,000,000 and 75,685,626 shares authorized, 0 and 75,495,266
issued and outstanding at December 31, 2021 and 2020,
respectively |
|
— |
|
|
|
143,086 |
|
Stockholders’ equity
(deficit): |
|
|
|
Common stock, $0.0001 par value; 400,000,000 and 114,290,527 shares
authorized, 114,991,026 and 5,019,582 issued and outstanding at
December 31, 2021 and 2020, respectively |
|
11 |
|
|
|
1 |
|
Additional paid-in capital |
|
323,666 |
|
|
|
1,611 |
|
Accumulated deficit |
|
(202,078 |
) |
|
|
(107,747 |
) |
Total stockholders’ equity
(deficit) |
|
121,599 |
|
|
|
(106,135 |
) |
Total liabilities, redeemable
convertible preferred stock and stockholders’ equity (deficit) |
$ |
260,798 |
|
|
$ |
57,031 |
|
SCIENCE 37 HOLDINGS,
INC.CONSOLIDATED STATEMENTS OF CASH
FLOWS(In thousands)
|
Year Ended December 31, |
|
|
2021 |
|
|
|
2020 |
|
Operating
activities |
|
|
|
Net loss |
$ |
(94,331 |
) |
|
$ |
(31,674 |
) |
Adjustments to reconcile net
loss to net cash used in operating activities: |
|
|
|
Depreciation and amortization |
|
7,799 |
|
|
|
4,447 |
|
Non-cash lease expense related to operating lease right-of-use
assets |
|
1,429 |
|
|
|
1,885 |
|
Stock-based compensation |
|
8,407 |
|
|
|
122 |
|
Loss on change in fair value of earn-out liability |
|
31,300 |
|
|
|
— |
|
Loss on disposal of fixed assets |
|
10 |
|
|
|
— |
|
Changes in assets and liabilities: |
|
|
|
Accounts receivable and unbilled services, net (including amounts
with related parties) |
|
501 |
|
|
|
(7,860 |
) |
Prepaid expenses and other current assets |
|
(6,026 |
) |
|
|
(226 |
) |
Other assets |
|
(142 |
) |
|
|
363 |
|
Accounts payable |
|
5,243 |
|
|
|
3,832 |
|
Accrued expenses and other current liabilities |
|
7,158 |
|
|
|
6,782 |
|
Deferred revenue |
|
2,044 |
|
|
|
632 |
|
Operating lease liabilities |
|
(1,112 |
) |
|
|
(3,607 |
) |
Other, net |
|
1,242 |
|
|
|
(172 |
) |
Net cash used in operating
activities |
|
(36,478 |
) |
|
|
(25,476 |
) |
Investing
activities |
|
|
|
Capitalization of software development costs |
|
(19,345 |
) |
|
|
(5,814 |
) |
Purchases of fixed assets |
|
(1,231 |
) |
|
|
(352 |
) |
Net cash used in investing
activities |
|
(20,576 |
) |
|
|
(6,166 |
) |
Financing
activities |
|
|
|
Proceeds from Series D-1 financing, net of issuance costs |
|
— |
|
|
|
39,860 |
|
Repurchase of common stock |
|
— |
|
|
|
(3,675 |
) |
Proceeds from warrant exercises |
|
10 |
|
|
|
— |
|
PIPE shares issuance, net of transaction costs |
|
184,530 |
|
|
|
— |
|
Merger shares issuance, net of transaction costs |
|
52,200 |
|
|
|
— |
|
Cash received from stock option exercises |
|
1,432 |
|
|
|
132 |
|
Net cash provided by financing
activities |
|
238,172 |
|
|
|
36,317 |
|
Net increase in cash, cash
equivalents, and restricted cash |
|
181,118 |
|
|
|
4,675 |
|
Cash, cash equivalents, and
restricted cash, beginning of period |
|
33,483 |
|
|
|
28,808 |
|
Cash, cash equivalents, and
restricted cash, end of period |
$ |
214,601 |
|
|
$ |
33,483 |
|
Supplemental
disclosures of non-cash activities: |
|
|
|
Net change in accounts payable and accrued expenses and other
current liabilities related to capitalized software and fixed asset
additions |
$ |
(4,325 |
) |
|
$ |
(375 |
) |
ROU asset obtained in exchange
for operating lease liabilities |
$ |
(1,305 |
) |
|
$ |
(4,096 |
) |
Conversion of preferred stock into common stock |
$ |
(143,086 |
) |
|
$ |
— |
|
Earn-out shares |
$ |
67,600 |
|
|
$ |
— |
|
SCIENCE 37 HOLDINGS,
INC.NON-GAAP FINANCIAL
MEASURES(Unaudited)
The following table reconciles Gross Profit (loss) to Adjusted
Gross Profit (loss):
|
Three Months Ended December
31, |
|
Year Ended December 31, |
(In thousands) |
|
2021 |
|
|
2020 |
|
|
|
2021 |
|
|
2020 |
|
Gross profit |
$ |
4,228 |
|
$ |
(505 |
) |
|
$ |
17,203 |
|
$ |
1,107 |
|
Stock-based compensation
expense (direct) |
|
499 |
|
|
5 |
|
|
|
846 |
|
|
(65 |
) |
Adjusted gross
profit |
$ |
4,727 |
|
$ |
(500 |
) |
|
$ |
18,049 |
|
$ |
1,042 |
|
The following table reconciles Net Loss to Adjusted EBITDA:
|
Three Months Ended December
31, |
|
Year Ended December 31, |
(In thousands) |
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
Net loss and comprehensive
loss |
$ |
(65,099 |
) |
|
$ |
(12,324 |
) |
|
$ |
(94,331 |
) |
|
$ |
(31,674 |
) |
Interest income |
|
(1 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
(77 |
) |
Depreciation and
amortization |
|
2,610 |
|
|
|
1,284 |
|
|
|
7,799 |
|
|
|
4,447 |
|
Other income(1) |
|
31,071 |
|
|
|
(18 |
) |
|
|
30,615 |
|
|
|
(712 |
) |
Stock-based compensation
expense |
|
6,494 |
|
|
|
120 |
|
|
|
8,407 |
|
|
|
122 |
|
Restructuring costs |
|
— |
|
|
|
72 |
|
|
|
— |
|
|
|
772 |
|
Transaction related
expenses |
|
3,185 |
|
|
|
— |
|
|
|
3,185 |
|
|
|
— |
|
Franchise taxes |
|
241 |
|
|
|
— |
|
|
|
241 |
|
|
|
78 |
|
Provision for income
taxes |
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
Adjusted
EBITDA |
$ |
(21,498 |
) |
|
$ |
(10,867 |
) |
|
$ |
(44,086 |
) |
|
$ |
(27,044 |
) |
(1) For the three months and year ended December 31, 2021
and 2020, other income includes $31,300 and $0, respectively, of
loss associated with the change in the fair value of the earn-out
liability.
The following table reconciles Net Loss to Adjusted Net
Loss:
|
Three Months Ended December
31, |
|
Year Ended December 31, |
(In thousands) |
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
Net loss and comprehensive
loss |
$ |
(65,099 |
) |
|
$ |
(12,324 |
) |
|
$ |
(94,331 |
) |
|
$ |
(31,674 |
) |
Interest income |
|
(1 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
(77 |
) |
Other income(1) |
|
31,071 |
|
|
|
(18 |
) |
|
|
30,615 |
|
|
|
(712 |
) |
Stock-based compensation
expense |
|
6,494 |
|
|
|
120 |
|
|
|
8,407 |
|
|
|
122 |
|
Restructuring costs |
|
— |
|
|
|
72 |
|
|
|
— |
|
|
|
772 |
|
Transaction related
expenses |
|
3,185 |
|
|
|
— |
|
|
|
3,185 |
|
|
|
— |
|
Adjusted net loss and
comprehensive loss |
$ |
(24,350 |
) |
|
$ |
(12,151 |
) |
|
$ |
(52,127 |
) |
|
$ |
(31,569 |
) |
(1) For the three months and year ended December 31, 2021
and 2020, other income includes $31,300 and $0, respectively, of
loss associated with the change in the fair value of the earn-out
liability.
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