ReShape Lifesciences® Reports First Quarter Ended March 31, 2023 Financial Results and Provides Corporate Update
Achieved Continued Improvement in Operational Effectiveness With First Quarter 2023 Operating Expenses Down 42.9% Compared to the First Quarter of 2022
Executing a Plan For Growth and Profitability With a Balance Sheet Bolstered By Approximately
Conference Call to be Held at
First Quarter 2023 and Subsequent Highlights
- In May, presented preclinical data on its proprietary Diabetes Bloc-Stim Neuromodulation™ (DBSN™) device in a poster at the Keystone Symposia on Type 2 Diabetes (T2D) in
Palm Springs, CA , further validating the potential of this technology to treat T2D and reduce patients’ dependence on medication. - In April, completed a
$2.5 million registered direct offering with a single institutional investor, extending the company's cash runway into 2024, creating a sustainable path to profitability. - In April, received a Notice of Allowance from the
U.S. Patent and Trademark Office (USPTO) for patent application 16/792,094, entitled, “Systems and Methods for Determining Failure of Intragastric Devices,” related to the company’s Obalon® Balloon System, expected to provide protection into at leastJanuary 2031 , excluding any potential Patent Term Extension (PTE). - In March, formed a
Scientific Advisory Board (SAB) comprised of internationally recognized experts and surgeons in the obesity and metabolic disease fields. The newly createdSAB will provide management with strategic input and external scientific review of the company’s development activities and product pipeline. - In February, raised
$10.2 million in an upsized underwritten public offering.
“In 2023, we have continued to leverage operational efficiencies, optimize our lead generation programs, and invest in our growth drivers. Our achievement of a 42.9% reduction in operating expenses, excluding one-time charges, during the first quarter, as compared to the same period last year, is a direct result of the execution of our growth pillars. We will continue to drive revenue by expanding our product offering to treat obesity and metabolic disease across the entire care continuum and strengthen our position to exceed our goals,” stated
“Additionally, I am particularly enthusiastic about working with our recently formed, global
At the same time, we continue to engage healthcare professionals, employers and individuals to expand awareness and use of ReShape’s personalized HIPAA-compliant, weight management program, ReShapeCare™, with resources including personalized health coaching that helps individuals achieve durable long-term weight loss goals, improvements in obesity related comorbidities and quality of life. Of note, we remain committed to working with large, self-insured employers to provide ReShapeCare™ to their employees in order to positively impact overall employee health and, thus, reduce employers’ health care costs.”
First Quarter Ended
Revenue totaled
Gross Profit for both the three months ended
Sales and Marketing Expenses for the three months ended
General and Administrative Expenses for the three months ended
Research and Development Expenses for the three months ended
Cash and Cash Equivalents as of
A full discussion of our financials is available in our Annual Report on Form 10-Q, filed with the
Conference Call Information
Management will host a conference call to discuss ReShape’s financial and operational results today at
An archived replay will also be available on the “Events and Presentations” section of ReShape’s website at: https://ir.reshapelifesciences.com/events-and-presentations.
About
Forward-Looking Safe Harbor Statement
This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from those discussed due to known and unknown risks, uncertainties, and other factors. These forward-looking statements generally can be identified by the use of words such as "expect," "plan," "anticipate," "could," "may," "intend," "will," "continue," "future," other words of similar meaning and the use of future dates. Forward-looking statements in this press release include statements about the Company’s expected path to profitability, the expected timing of the FDA submission and review process for the Lap-Band 2.0, the expected adoption of the Lap-Band 2.0 by surgeons, and the expectation for increased revenue. These and additional risks and uncertainties are described more fully in the company's filings with the
Non-GAAP Disclosures
In addition to the financial information prepared in conformity with GAAP, we provide certain historical non-GAAP financial information. Management believes that these non-GAAP financial measures assist investors in making comparisons of period-to-period operating results.
Management believes that the presentation of this non-GAAP financial information provides investors with greater transparency and facilitates comparison of operating results across a broad spectrum of companies with varying capital structures, compensation strategies, and amortization methods, which provides a more complete understanding of our financial performance, competitive position, and prospects for the future. However, the non-GAAP financial measures presented in this release have certain limitations in that they do not reflect all of the costs associated with the operations of our business as determined in accordance with GAAP. Therefore, investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Further, the non-GAAP financial measures presented by the company may be different from similarly named non-GAAP financial measures used by other companies.
Adjusted EBITDA
Management uses Adjusted EBITDA in its evaluation of the company’s core results of operations and trends between fiscal periods and believes that these measures are important components of its internal performance measurement process. Adjusted EBITDA is defined as net loss before interest, taxes, depreciation and amortization, stock-based compensation, and other one-time costs. Management uses Adjusted EBITDA in its evaluation of the company’s core results of operations and trends between fiscal periods and believes that these measures are important components of its internal performance measurement process. Therefore, investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Further, the non-GAAP financial measures presented by the company may be different from similarly named non-GAAP financial measures used by other companies.
CONTACTS
ReShape Lifesciences Investor Contact:
Chief Financial Officer
949-276-6042
ir@ReShapeLifesci.com
Investor Relations Contact:
(917)-633-6086
mmiller@rxir.com
Consolidated Balance Sheets (dollars in thousands; unaudited) |
||||||||||
2023 | 2022 | |||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 8,983 | $ | 3,855 | ||||||
Restricted cash | 100 | 100 | ||||||||
Accounts and other receivables | 2,125 | 2,180 | ||||||||
Inventory | 3,493 | 3,611 | ||||||||
Prepaid expenses and other current assets | 530 | 165 | ||||||||
Total current assets | 15,231 | 9,911 | ||||||||
Property and equipment, net | 672 | 698 | ||||||||
Operating lease right-of-use assets | 86 | 171 | ||||||||
Deferred tax asset, net | 57 | 56 | ||||||||
Other intangible assets, net | 249 | 260 | ||||||||
Other assets | 57 | 46 | ||||||||
Total assets | $ | 16,352 | $ | 11,142 | ||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 1,997 | $ | 1,926 | ||||||
Accrued and other liabilities | 5,319 | 5,040 | ||||||||
Warranty liability, current | 200 | 344 | ||||||||
Operating lease liabilities, current | 86 | 171 | ||||||||
Total current liabilities | 7,602 | 7,481 | ||||||||
Common stock warrant liability | 992 | — | ||||||||
Total liabilities | 8,594 | 7,481 | ||||||||
Commitments and contingencies | ||||||||||
Stockholders’ equity: | ||||||||||
Preferred stock | ||||||||||
Series C convertible preferred stock | — | — | ||||||||
Common stock | 3 | 1 | ||||||||
Additional paid-in capital | 634,697 | 627,935 | ||||||||
Accumulated deficit | (626,849 | ) | (624,187 | ) | ||||||
Accumulated other comprehensive loss | (93 | ) | (88 | ) | ||||||
Total stockholders’ equity | 7,758 | 3,661 | ||||||||
Total liabilities and stockholders’ equity | $ | 16,352 | $ | 11,142 |
Consolidated Statements of Operations (dollars in thousands; unaudited) |
|||||||||
Three Months Ended |
|||||||||
2023 | 2022 | ||||||||
Revenue | $ | 2,287 | $ | 2,440 | |||||
Cost of revenue | 1,063 | 1,222 | |||||||
Gross profit | 1,224 | 1,218 | |||||||
Operating expenses: | |||||||||
Sales and marketing | 2,182 | 4,694 | |||||||
General and administrative | 4,220 | 3,892 | |||||||
Research and development | 453 | 745 | |||||||
Total operating expenses | 6,855 | 9,331 | |||||||
Operating loss | (5,631 | ) | (8,113 | ) | |||||
Other expense (income), net: | |||||||||
Interest expense, net | 5 | (1 | ) | ||||||
Gain on changes in fair value of liability warrants | (2,965 | ) | — | ||||||
Gain on foreign currency exchange, net | (21 | ) | (16 | ) | |||||
Other | (2 | ) | (11 | ) | |||||
Loss before income tax provision | (2,648 | ) | (8,085 | ) | |||||
Income tax benefit | 14 | 30 | |||||||
Net loss | $ | (2,662 | ) | $ | (8,115 | ) |
The following table contains a reconciliation of GAAP net loss to non-GAAP net loss Adjusted EBITDA attributable to common stockholders for the months ended
Three Months Ended |
|||||||
2023 | 2022 | ||||||
GAAP net loss | $ | (2,662 | ) | $ | (8,115 | ) | |
Adjustments: | |||||||
Interest expense, net | 5 | (1 | ) | ||||
Income tax benefit | 14 | 30 | |||||
Depreciation and amortization | 48 | 550 | |||||
Stock-based compensation expense | 222 | 719 | |||||
Gain on changes in fair value of liability warrants | (2,965 | ) | — | ||||
Adjusted EBITDA | $ | (5,338 | ) | $ | (6,817 | ) |

Source: ReShape Lifesciences Inc