NuVasive Reports Second Quarter 2004 Financial Results Second
Quarter Highlights: SAN DIEGO, July 28 /PRNewswire-FirstCall/ --
NuVasive, Inc. (NASDAQ:NUVA), a medical device company focused on
developing products for minimally disruptive surgical treatments
for the spine, announced today second quarter financial results for
the period ended June 30, 2004. The Company reported second quarter
revenues of $8.8 million, a 60% increase over the $5.5 million for
the second quarter of 2003 and a 16% increase over the $7.6 million
for the first quarter of 2004. Maximum Access Surgery (MAS)
revenues for the second quarter were $6.2 million, an increase of
134% from the second quarter of 2003, and up 28% from the first
quarter of 2004. Gross profit for the second quarter of 2004 was
$6.3 million with a gross margin of 71.8%, compared with a gross
profit of $3.9 million with a gross margin of 70.5% in the second
quarter of 2003. For the first quarter of 2004, the gross profit
was $5.4 million with a gross margin of 71%. Research and
development expense was $2.1 million for the second quarter of
2004, compared with $1.3 million in the second quarter of 2003 and
$2.0 million in the first quarter of 2004. The year-over-year
increase reflects investment in the enhancement of the Company's
MAS platform, specifically its SpheRx(TM) pedicle screw system
scheduled for launch in the third quarter, and for the development
of its total disc replacement (TDR) product with an investigational
device exemption (IDE) submission anticipated in the first quarter
of 2005. On a GAAP basis for the three-month period ended June 30,
2004, the Company reported a net loss of $4.5 million, or $0.34 per
share. On a pro forma basis, second quarter net loss excluding
stock based compensation was $2.6 million, or $0.20 per share.
Cash, cash equivalents and short-term investments were $67.6
million at the end of the second quarter 2004. In the second
quarter of 2004, NuVasive completed its initial public offering of
approximately 6.9 million common shares at $11 per share, for net
proceeds of $70.4 million. For the second quarter the weighted
average shares, which includes conversion of preferred stock into
common stock in connection with NuVasive's initial public offering,
were 13,188,000. At the end of the quarter, the total common shares
outstanding were 23,738,166. Alexis V. Lukianov, Chairman,
President & Chief Executive Officer, said, "We are pleased to
report our second quarter results, which are on track with the
growth strategy outlined during our initial public offering
process. Of particular significance in the quarter was the strong
momentum in the adoption of our MAS products, which resulted in a
70% MAS - 30% Classic Fusion product mix. We see this mix as a key
milestone along with the continuing increase in the number of
surgical procedures performed, which totaled 3,800 up 16% from the
first quarter of 2004." For the full year 2004, the Company's
guidance for revenue is in the range of $36 million to $37 million.
NuVasive will host a conference call today at 5:00 p.m. EDT / 2:00
p.m. PDT to discuss second quarter results. A live Webcast of the
conference call will be available online from the investor
relations page of NuVasive's corporate website at
http://www.nuvasive.com/. The dial-in numbers are (800) 921-9431
for domestic callers, and (973) 935-8505 for international. The
reservation number for both is 4956743. The call will remain
available on NuVasive's website, http://www.nuvasive.com/, through
August 25, 2004. A telephonic replay of the call will be available
until August 11, 2004. The replay dial-in numbers are (877)
519-4471 for domestic callers and (973) 341-3080 for international
callers. Please use reservation code 4956743. About NuVasive
NuVasive is a medical device company focusing on the design,
development and marketing of products for use in minimally
disruptive surgical treatments for the spine. NuVasive's Maximum
Access Surgery (MAS(TM)) product platform includes the
NeuroVision(R) nerve avoidance system, MaXcess(TM) spine access
system, and specialized implants. NuVasive also offers classic
fusion implant products for use in spine surgery and has an R&D
pipeline emphasizing motion preservation products such as total
disc replacement. This press release contains forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 that involve risks, uncertainties, assumptions
and other factors which, if they do not materialize or prove
correct, could cause NuVasive's results to differ materially from
historical results or those expressed or implied by such
forward-looking statements. All statements, other than statements
of historical fact, are statements that could be deemed
forward-looking statements, including statements containing the
words "planned," "expects," "believes," "strategy," "opportunity,"
"anticipates" and similar words. These statements may include,
among others, plans, strategies and objectives of management for
future operations; any statements regarding proposed new products,
services or developments; any statements regarding future economic
conditions or financial or operating performance; statements of
belief and any statements of assumptions underlying any of the
foregoing. The potential risks and uncertainties that could cause
actual growth and results to differ materially include, but are not
limited to, the rapidly changing and competitive nature of the
medical device industry, NuVasive's ability to convince surgeons to
use its products, the ability of patients to obtain third-party
reimbursement for surgical procedures employing NuVasive's
products, risks related to government regulation of medical
devices, risks related to NuVasive's ability to effectively manage
the growth of its business, risks related to ownership and
enforcement of intellectual property rights, NuVasive's ability to
successfully develop new products, and other risks and
uncertainties more fully described in NuVasive's Prospectus filed
pursuant to Rule 424 under the Securities Act of 1933, as amended,
with the Securities and Exchange Commission on May 13, 2004.
NuVasive's public filings with the Securities and Exchange
Commission are available at http://www.sec.gov/. NuVasive assumes
no obligation to update any forward-looking statement to reflect
events or circumstances arising after the date on which it was
made. NUVASIVE, INC. CONSOLIDATED BALANCE SHEETS (in thousands)
June 30, December 31, 2004 2003 Assets Current assets: Cash and
cash equivalents $ 28,994 $ 5,631 Short-term investments 38,619
4,017 Accounts receivable, net 4,910 3,728 Inventory, net 4,853
5,048 Prepaid expenses and other current assets 943 428 Total
current assets 78,319 18,852 Property and equipment, net 3,685
3,390 Notes receivable from employee -- 21 Other assets 66 108
Total Assets $ 82,070 $ 22,371 Liabilities and Stockholders' Equity
Current liabilities: Accounts payable and accrued liabilities $
4,503 $ 5,036 Accrued payroll and related expenses 2,685 2,242
Current portion of notes payable -- 3,493 Current portion of
obligations under capital leases 172 306 Total current liabilities
7,360 11,077 Notes payable, less current portion 1,202 Obligations
under capital leases, less current portion 22 Stockholders equity:
Preferred stock -- 32 Common stock 24 4 Additional paid-in capital
152,859 75,044 Notes receivable from stockholders -- (188) Deferred
compensation (5,226) (566) Accumulated deficit (72,947) (64,256)
Total stockholders' equity 74,710 10,070 Total liabilities and
stockholders' equity $ 82,070 $ 22,371 NUVASIVE, INC. CONSOLIDATED
STATEMENTS OF OPERATIONS (in thousands, except per share amounts)
Three Months Ended Six Months Ended June 30, June 30, 2004 2003
2004 2003 Revenues: MAS $ 6,171 $ 2,636 $10,974 $ 4,700 Classic
Fusion 2,638 2,859 5,423 5,244 Total revenues 8,809 5,495 16,397
9,944 Cost of goods sold 2,481 1,624 4,685 3,257 Gross profit 6,328
3,871 11,712 6,687 Operating expenses: Research and development
2,129 1,335 4,082 2,825 Sales and marketing 4,691 2,856 8,282 5,117
General and administrative 2,118 1,565 3,972 3,284 Stock-based
compensation 1,845 93 3,978 144 Total operating expenses 10,783
5,849 20,314 11,370 Interest income 77 22 103 57 Interest expense
net (88) (71) (182) (108) Other income (expense), net -- 4 (11) 7
Net loss $(4,466) $(2,023) $(8,692) $(4,727) Historical net loss
per share: Basic and diluted $ (0.34) $ (1.26) $ (1.17) $ (2.93)
Weighted average shares- basic and diluted 13,188 1,609 7,418 1,613
Pro-forma per share information: Pro-forma basic and diluted net
loss per share excluding stock-based compensation $ (0.20) $ (1.20)
$ (0.64) $ (2.84) Weighted average shares- basic and diluted 13,188
1,609 7,418 1,613 Contacts: Investors/Media: Kevin C. O'Boyle
Stephanie Carrington/Greg Tiberend Chief Financial Officer The Ruth
Group NuVasive, Inc. 646-536-7017/7005 858-271-7070 DATASOURCE:
NuVasive, Inc. CONTACT: Kevin C. O'Boyle, Chief Financial Officer
of NuVasive, Inc., +1-858-271-7070, ; or Investors/Media -
Stephanie Carrington, +1-646-536-7017, , or Greg Tiberend,
+1-646-536-7005, , both of The Ruth Group, for NuVasive, Inc. Web
site: http://www.nuvasive.com/
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