ReShape Lifesciences™ Reports First Quarter 2022 Financial Results and Provides Corporate Update
Conference Call to be Held at
First Quarter Highlights and Accomplishments
- Ongoing, direct-to-consumer (DTC) marketing campaign continues to be successful in driving demand, filling surgeons’ patient pipeline for Lap-Band® procedures
- As the COVID-19 Omicron variant subsided in the latter part of the first quarter,
March 2022 revenues eclipsed those of January and February, combined - Robust trend in Lap-Band® sales continues, evidenced by weekly sales growth into April and May
Vern Vincent , Senior Director, Global Professional Education and Medical Affairs, to be recognized as this year’s Distinguished Industry Partner at theAmerican Society for Metabolic and Bariatric Surgery (ASMBS) 2022 LEAD Gala and Awards- Following the presentation of the Lap-Band® Program and supportive reshapecare™ Virtual Health Coaching Platform to bariatric surgeons, allied health professionals and fellows, at the
ASMBS Leadership Academy and re-UNITED Meeting in January, ReShape will facilitate the training of the next generation of bariatric surgeons at the ASMBS annual conference in June
“The emergence of the fast-spreading COVID-19 Omicron variant in late 2021 led to the closing of a significant number of bariatric centers, thus, severely limiting elective surgeries, nationwide, during the first few months of 2022, which deferred revenues during the quarter,” stated
“Given the level of renewed interest in the Lap-Band® from key industry organizations, bariatric surgeons and consumers, alike, we are enthusiastic about the road ahead. Understanding that the four-to-six-month mandatory waiting period required by insurers for bariatric or weight loss procedures, including the Lap-Band®, represents an anticipated interval between early patient engagement and scheduled procedures, we are just at the cusp of reaping the benefits of our DTC marketing campaign, which we plan to expand throughout the year by integrating targeted digital media marketing with our current television and print campaign. We are optimistic that the upward trend in sales we are experiencing will continue as we expand visibility and demand for the Lap-Band®.”
First Quarter Ended
Revenue totaled
Gross Profit for 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
Non-GAAP adjusted EBITDA loss was
Cash and Cash Equivalents were
Conference Call Information
Management will post a webcast 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 ReShape Lifesciences™
ReShape Lifesciences™ is America's premier weight loss and metabolic health-solutions company, offering an integrated portfolio of proven products and services that manage and treat obesity and metabolic disease. The FDA-approved Lap-Band® Program provides minimally invasive, long-term treatment of obesity and is an alternative to more invasive surgical stapling procedures such as the gastric bypass or sleeve gastrectomy. The ReShape Vest™ System is an investigational (outside the
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 our expectation that the marketing campaign should continue to promote increased demand for Lap-Band® procedures and, thus, potentially a significant increase in revenues for ReShape. 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 and that, in some respects, these non-GAAP financial measures are more indicative of the Company’s ongoing core operating performance than their GAAP equivalents.
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, derivative instruments, 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, changes in fair value of liability warrants 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)
2022 | 2021 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 15,410 | $ | 22,765 | ||||
Restricted cash | 50 | 50 | ||||||
Accounts and other receivables | 2,410 | 2,815 | ||||||
Inventory | 3,998 | 3,003 | ||||||
Prepaid expenses and other current assets | 1,759 | 1,622 | ||||||
Total current assets | 23,627 | 30,255 | ||||||
Property and equipment, net | 1,371 | 1,454 | ||||||
Operating lease right-of-use assets | 524 | 266 | ||||||
Other intangible assets, net | 20,371 | 20,827 | ||||||
Other assets | 1,377 | 1,456 | ||||||
Total assets | $ | 47,270 | $ | 54,258 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 3,598 | $ | 3,468 | ||||
Accrued and other liabilities | 3,463 | 3,169 | ||||||
Warranty liability, current | 649 | 415 | ||||||
Operating lease liabilities, current | 441 | 279 | ||||||
Total current liabilities | 8,151 | 7,331 | ||||||
Operating lease liabilities, noncurrent | 86 | — | ||||||
Warranty liability, noncurrent | 41 | 300 | ||||||
Deferred income taxes | 367 | 555 | ||||||
Total liabilities | 8,645 | 8,186 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Preferred stock: | ||||||||
Series C convertible preferred stock | — | — | ||||||
Common stock | 19 | 18 | ||||||
Additional paid-in capital | 623,652 | 622,906 | ||||||
Accumulated deficit | (584,975 | ) | (576,760 | ) | ||||
Accumulated other comprehensive loss | (71 | ) | (92 | ) | ||||
Total stockholders’ equity | 38,625 | 46,072 | ||||||
Total liabilities and stockholders’ equity | $ | 47,270 | $ | 54,258 |
Consolidated Statements of Operations
(dollars in thousands, except share and per share amounts; unaudited)
Three Months Ended |
||||||||
2022 | 2021 | |||||||
Revenue | $ | 2,440 | $ | 3,221 | ||||
Cost of revenue | 1,222 | 937 | ||||||
Gross profit | 1,218 | 2,284 | ||||||
Operating expenses: | ||||||||
Sales and marketing | 4,707 | 1,250 | ||||||
General and administrative | 4,163 | 2,720 | ||||||
Research and development | 748 | 571 | ||||||
Total operating expenses | 9,618 | 4,541 | ||||||
Operating loss | (8,400 | ) | (2,257 | ) | ||||
Other expense (income), net: | ||||||||
Interest expense, net | (1 | ) | 599 | |||||
Loss on extinguishment of debt, net | — | 1,960 | ||||||
Other, net | (11 | ) | — | |||||
(Gain) Loss on foreign currency exchange, net | (16 | ) | 33 | |||||
Loss before income tax provision | (8,372 | ) | (4,849 | ) | ||||
Income tax (benefit) expense | (157 | ) | 25 | |||||
Net loss | $ | (8,215 | ) | $ | (4,874 | ) | ||
Net loss per share - basic and diluted: | ||||||||
Net loss per share - basic and diluted | $ | (0.44 | ) | $ | (1.24 | ) | ||
Shares used to compute basic and diluted net loss per share | 18,539,568 | 3,927,986 | ||||||
The following table contains a reconciliation of non-GAAP net loss to GAAP net loss attributable to common stockholders for the three months ended
Three Months Ended |
|||||||
2022 | 2021 | ||||||
GAAP net loss | $ | (8,215 | ) | $ | (4,874 | ) | |
Adjustments: | |||||||
Interest expense, net | (1 | ) | 599 | ||||
Income tax expense (benefit) | (157 | ) | 25 | ||||
Depreciation and amortization | 550 | 418 | |||||
Stock-based compensation expense | 747 | 101 | |||||
Loss on extinguishment of debt, net | — | 1,960 | |||||
Non-GAAP loss | $ | (7,076 | ) | $ | (1,771 | ) |
Source: ReShape Lifesciences Inc