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Cytori Reports First Quarter 2016 Business and Financial Results
May. 11, 2016 08:54AM PST
Genetics InvestingSAN DIEGO–(BUSINESS WIRE)–Cytori Therapeutics (NASDAQ: CYTX) (“Cytori” or the “Company”) today announced its first quarter financial results and provided updates on its corporate activity and clinical development. First quarter 2016 net loss allocable to common stockholders was $5.3 million and $0.03 per share (or $0.41 per share after the effect of a 1:15 reverse stock …
SAN DIEGO–(BUSINESS WIRE)–Cytori Therapeutics (NASDAQ: CYTX) (“Cytori” or the “Company”) today
announced its first quarter financial results and provided updates on
its corporate activity and clinical development.
First quarter 2016 net loss allocable to common stockholders was $5.3
million and $0.03 per share (or $0.41 per share after the effect of a
1:15 reverse stock split announced on May 10, 2016). Cytori continues to
manage its operating cash burn, spending approximately $5.1 million in
the first quarter 2016. Cytori ended the first quarter of 2016 with $9.4
million of cash and cash equivalents.
“The business fundamentals continue to strengthen,” said Dr. Marc H.
Hedrick, President and CEO of Cytori Therapeutics. “The US trial
enrollment for our lead indication is nearly complete, we see positive
trends on revenue and we continue see new opportunities for our
technology that are in alignment with the Company’s core strategic
direction.”
Select Recent Highlights:
- Investigator presentation of SCLERADEC I 24-month follow-up data
reported sustained benefit for scleroderma hand dysfunction - Broad orphan drug designation and small or medium-size enterprise
(SME) status granted by European Medicines Agency - Launch of compassionate use program for scleroderma in Europe in
partnership with Idis Managed Access - Announcement of STAR enrollment progress consistent with development
timelines
Q1 2016 Financial Performance
- Q1 2016 operating cash burn of $5.1 million, compared to $5.0 million
for the same period in 2015. - Cash and debt principal balances at March 31, 2016 of approximately
$9.4 million and $17.7 million, respectively. - Q1 2016 total revenues of $2.9 million, compared to $2.3 million for
the same period in 2015. - Q1 2016 net loss of $5.3 million or $0.41 per share, compared to $6.5
million, which excludes a non-cash charge of $15.4 million related to
the change in fair value of warrant liabilities and a beneficial
conversion feature charge for convertible preferred stock of $0.7
million, or $0.92 per share for the same period in 2015.
“Q1 2016 net loss was approximately 20% lower than Q1 2015, despite an
expansion of our investments in research and development,” said Tiago
Girao, VP of Finance and CFO of Cytori Therapeutics. “For the remainder
of 2016, we plan to continue to narrow our quarterly losses and decrease
the need for capital through a number of initiatives. These efforts
consist largely of balancing further improvements in operational
efficiency, working capital management, increased revenue, and an
intense focus on those activities that we believe will contribute to
stockholder value creation.”
Anticipated Near Term Catalysts:
- Complete enrollment of US STAR phase III trial (anticipated by
mid-June 2016) for scleroderma hand dysfunction - Report of 48-week US pilot/phase IIb ACT-OA trial (94 patients) with
data analysis in Q3 2016 - Complete enrollment of investigator-initiated EU phase III
SCLERADEC-II trial (anticipated in 2016) for scleroderma hand
dysfunction - File IDE and obtain approval for burn wound therapy trial related to
contract with BARDA (anticipated in 2016)
2016 Reiterated Financial Guidance
- Operating cash burn within a range of $18 million to $20 million
- Total revenues (product and contract) within a range of $12 million to
$14 million
Management Conference Call Webcast
Cytori will host a management conference call at 5:30 p.m. Eastern Time
today to further discuss the Company’s progress. The webcast will be
available live and by replay two hours after the call and may be
accessed under “Webcasts” in the Investor
Relations section of Cytori’s website. If you are unable to access
the webcast, you may dial in to the call at +1.877.402.3914, Conference
ID: 3175608.
About Cytori
Cytori Therapeutics is a late stage cell therapy company developing
autologous cell therapies from adipose tissue to treat a variety of
medical conditions. Data from preclinical studies and clinical trials
suggest that Cytori Cell Therapy™ acts principally by improving blood
flow, modulating the immune system, and facilitating wound repair. As a
result, Cytori Cell Therapy™ may provide benefits across multiple
disease states and can be made available to the physician and patient at
the point-of-care through Cytori’s proprietary technologies and
products. For more information: visit www.cytori.com.
Cautionary Statement Regarding Forward-Looking
Statements
This press release includes forward-looking statements that involve
known and unknown risks and uncertainties. All statements, other than
historical facts are forward looking statements. Such statements are
subject to risks and uncertainties that could cause our actual results
and financial position to differ materially. Some of these risks include
clinical, pre-clinical and regulatory uncertainties, such as those
associated with the ACT-OA, STAR, SCLERADEC-I, SCLERADEC-II and possible
BARDA wound trial (including risks in the collection and results of
clinical data and final clinical outcomes), as well as achievement of
financial goals (including 2016 operating cash burn and 2016 total
revenues, as well as anticipated narrowing of quarterly losses and
reduced need for capital), dependence on third party performance
(including performance of investigator-initiated trials), performance
and acceptance of our products in the marketplace, unexpected costs and
expenses that could adversely impact liquidity, our reliance on key
personnel, the right of the Federal Government to cut or terminate
further support of the thermal burn injury program (including any
decision not to proceed with a wound trial in 2016), our abilities to
capitalize on our internal restructuring and achieve profitability, and
other risks and uncertainties described under the “Risk Factors” in
Cytori’s Securities and Exchange Commission Filings, included in our
annual and quarterly reports.
There may be events in the future that we are unable to predict, or over
which we have no control, and our business, financial condition, results
of operations and prospects may change in the future. We assume no
responsibility to update or revise any forward-looking statements to
reflect events, trends or circumstances after the date they are made
unless we have an obligation under U.S. Federal securities laws to do so.
| CYTORI THERAPEUTICS, INC. | ||||||||
| CONSOLIDATED CONDENSED BALANCE SHEETS | ||||||||
| (UNAUDITED) | ||||||||
| As of March 31, 2016 | As of December | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 9,358,000 | $ | 14,338,000 | ||||
| Accounts receivable, net of reserves of $795,000 and of $797,000 in 2016 and 2015, respectively | 829,000 | 1,052,000 | ||||||
| Inventories, net | 4,462,000 | 4,298,000 | ||||||
| Other current assets | 1,866,000 | 1,555,000 | ||||||
| Total current assets | 16,515,000 | 21,243,000 | ||||||
| Property and equipment, net | 1,523,000 | 1,631,000 | ||||||
| Restricted cash and cash equivalents | 350,000 | 350,000 | ||||||
| Other assets | 1,682,000 | 1,521,000 | ||||||
| Intangibles, net | 8,923,000 | 9,031,000 | ||||||
| Goodwill | 3,922,000 | 3,922,000 | ||||||
| Total assets | $ | 32,915,000 | $ | 37,698,000 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 6,693,000 | $ | 6,687,000 | ||||
| Current portion of long-term obligations, net of discount | 1,724,000 | — | ||||||
| Joint venture purchase obligation | 1,267,000 | 1,750,000 | ||||||
| Total current liabilities | 9,684,000 | 8,437,000 | ||||||
| Deferred revenues | 101,000 | 105,000 | ||||||
| Long-term deferred rent and other | 189,000 | 269,000 | ||||||
| Long-term obligations, net of discount, less current portion | 15,198,000 | 16,681,000 | ||||||
| Total liabilities | 25,172,000 | 25,492,000 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Series A 3.6% convertible preferred stock, $0.001 par value; 5,000,000 shares authorized; 13,500 shares issued; no shares outstanding in 2016 and 2015 | — | — | ||||||
| Common stock, $0.001 par value; 75,000,000 shares authorized; 13,310,740 and 13,003,893 shares issued and outstanding in 2016 and 2015, respectively | 13,000 | 13,000 | ||||||
| Additional paid-in capital | 369,339,000 | 368,214,000 | ||||||
| Accumulated other comprehensive income | 747,000 | 996,000 | ||||||
| Accumulated deficit | (362,356,000 | ) | (357,017,000 | ) | ||||
| Total stockholders’ equity | 7,743,000 | 12,206,000 | ||||||
| Total liabilities and stockholders’ equity | $ | 32,915,000 | $ | 37,698,000 | ||||
| CYTORI THERAPEUTICS, INC. | ||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||
| (UNAUDITED) | ||||||||
| For the Three Months Ended March 31, | ||||||||
| 2016 | 2015 | |||||||
| Product revenues | $ | 1,333,000 | $ | 902,000 | ||||
| Cost of product revenues | 567,000 | 598,000 | ||||||
| Gross profit | 766,000 | 304,000 | ||||||
| Development revenues: | ||||||||
| Government contracts and other | 1,585,000 | 1,444,000 | ||||||
| Operating expenses: | ||||||||
| Research and development | 4,127,000 | 3,963,000 | ||||||
| Sales and marketing | 1,035,000 | 839,000 | ||||||
| General and administrative | 2,286,000 | 2,499,000 | ||||||
| Change in fair value of warrants | — | 15,444,000 | ||||||
| Total operating expenses | 7,448,000 | 22,745,000 | ||||||
| Operating loss | (5,097,000 | ) | (20,997,000 | ) | ||||
| Other income (expense): | ||||||||
| Interest income | 2,000 | 1,000 | ||||||
| Interest expense | (657,000 | ) | (1,072,000 | ) | ||||
| Other income, net | 413,000 | 110,000 | ||||||
| Total other expense | (242,000 | ) | (961,000 | ) | ||||
| Net loss | $ | (5,339,000 | ) | $ | (21,958,000 | ) | ||
| Beneficial conversion feature for | ||||||||
| convertible preferred stock | — | (661,000 | ) | |||||
| Net loss allocable to common stock holders | $ | (5,339,000 | ) | $ | (22,619,000 | ) | ||
| Basic and diluted net loss per share allocable to common stockholders | $ | (0.41 | ) | $ | (3.19 | ) | ||
| Basic and diluted weighted average shares used in calculating net loss per share allocable to common stockholders | 13,086,376 | 7,080,590 | ||||||
| Comprehensive loss: | ||||||||
| Net loss | $ | (5,339,000 | ) | $ | (21,958,000 | ) | ||
| Other comprehensive (loss) income– foreign currency translation adjustments | (249,000 | ) | 36,000 | |||||
| Comprehensive loss | $ | (5,588,000 | ) | $ | (21,922,000 | ) | ||
| CYTORI THERAPEUTICS, INC. | ||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | ||||||||
| (UNAUDITED) | ||||||||
| For the Three Months Ended March 31, | ||||||||
| 2016 | 2015 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (5,339,000 | ) | $ | (21,958,000 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 291,000 | 213,000 | ||||||
| Amortization of deferred financing costs and debt discount | 232,000 | 257,000 | ||||||
| Joint venture acquisition obligation accretion | 17,000 | 203,000 | ||||||
| Change in fair value of warrants | — | 15,444,000 | ||||||
| Stock-based compensation expense | 317,000 | 459,000 | ||||||
| Loss on asset disposal | 2,000 | — | ||||||
| Increases (decreases) in cash caused by changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 155,000 | 546,000 | ||||||
| Inventories | (206,000 | ) | 100,000 | |||||
| Other current assets | (408,000 | ) | (470,000 | ) | ||||
| Other assets | (211,000 | ) | 68,000 | |||||
| Accounts payable and accrued expenses | 176,000 | 138,000 | ||||||
| Deferred revenues | (4,000 | ) | 21,000 | |||||
| Long-term deferred rent | (80,000 | ) | (51,000 | ) | ||||
| Net cash used in operating activities | (5,058,000 | ) | (5,030,000 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (69,000 | ) | (187,000 | ) | ||||
| Net cash used in investing activities | (69,000 | ) | (187,000 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Joint venture purchase payments | (500,000 | ) | (123,000 | ) | ||||
| Proceeds from sale of common stock, net | 562,000 | 3,974,000 | ||||||
| Dividends paid on preferred stock | — | (72,000 | ) | |||||
| Net cash provided by financing activities | 62,000 | 3,779,000 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | 85,000 | 15,000 | ||||||
| Net decrease in cash and cash equivalents | (4,980,000 | ) | (1,423,000 | ) | ||||
| Cash and cash equivalents at beginning of period | 14,338,000 | 14,622,000 | ||||||
| Cash and cash equivalents at end of period | $ | 9,358,000 | $ | 13,199,000 | ||||
Supplemental disclosure of cash flows information: | ||||||||
Cash paid during period for: | ||||||||
Interest | $ | 400,000 | $ | 612,000 | ||||
Supplemental schedule of non-cash investing and financing | ||||||||
Conversion of preferred stock into common stock | — | 10,000 | ||||||
Declared dividend related to preferred stock | — | 3,000 | ||||||