Advanced Energy Sales of $2.6 million in Q1,
up 333% year-over-year
Bovie Medical Corporation (NYSEMKT:BVX) (the “Company”),
a maker of medical devices and supplies and the developer of
J-Plasma®, a patented surgical product marketed and sold under the
Renuvion™ Cosmetic Technology brand in the cosmetic surgery market,
today reported financial results for its first quarter ended
March 31, 2018.
First Quarter 2018 Financial
Summary:
- Total Q1 revenue of approximately $9.9
million, up 18% year-over-year.
- Advanced Energy revenue of $2.6
million, up 333% year-over-year, driven by strong J-Plasma/Renuvion
sales.
- Core & OEM revenue of approximately
$7.3 million, down 6.4% year-over-year.
- Total Q1 adjusted EBITDA loss of
approximately $0.3 million versus adjusted EBITDA loss of
approximately $1.4 million for the first quarter of 2017.
First Quarter 2018 Operating
Highlights:
- On January 23rd, the Company announced
that it had enrolled the first patient in a U.S. Investigational
Device Exemption (IDE) clinical study of its J-Plasma technology
for use in dermal skin resurfacing. The objective of the study is
to demonstrate the safety and efficacy of J-Plasma technology for
use in dermal skin resurfacing.
- On March 6th, the Company announced the
appointment of Dr. Topaz J. Kirlew as Director of Regulatory
Affairs.
- On March 12th, the Company announced
the appointment of Craig A. Swandal to the Company’s Board of
Directors, effective March 9, 2018.
- On March 27th, the Company announced
the appointment of Scott R. Sanders as Director of Clinical
Education and Market Development.
- On March 29th, the Company announced
the launch of a new brand dedicated to the cosmetic surgery market.
Bovie Medical’s J-Plasma technology is now marketed and sold under
the brand name Renuvion Cosmetic Technology, which was developed as
part of the Company’s commitment to enhancing its ability to
commercialize its J-Plasma technology in the cosmetic surgery
market.
Operating Highlights Subsequent to
Quarter-End:
- On May 1st, the Company announced the
appointment of Diane I. Duncan, M.D., FACS, a Board-certified
plastic surgeon, to the Company’s Medical Advisory Board.
- On May 14th, the Company announced the
completion of enrollment in the U.S. Investigational Device
Exemption (IDE) clinical study of its J-Plasma technology for use
in dermal skin resurfacing.
Management
Comments:
“In the first quarter, we achieved 18% year-over-year sales
growth, which was fueled by strong sales in our Advanced Energy
business,” said Charlie Goodwin, Chief Executive Officer. “Our
Advanced Energy sales performance represents an exciting start to
the year, and reflects strong global demand for our
J-Plasma/Renuvion technology. In the U.S., we continued to see
strong adoption of our Renuvion Cosmetic Technology in the cosmetic
surgery market, where our sales organization is focused on
marketing and selling to plastic surgeons, cosmetic surgeons and
dermatologists.”
Mr. Goodwin continued: “Encouraged by our recent commercial
traction in the cosmetic surgery market, we remain focused in 2018
on increasing the awareness and adoption of our Renuvion
technology, while establishing the requisite support to facilitate
its broader adoption in the cosmetic surgery market in future
years. We are reaffirming our fiscal year financial guidance, and
look forward to delivering strong operating and financial
performance throughout 2018 for the benefit of our customers and
shareholders.”
First Quarter 2018
Results:
The following table represents revenue by reportable
segment:
Three Months EndedMarch 31,
Increase/Decrease (In thousands)
2018
2017
$ Change
% Change Core $ 6,519 $ 6,775 $ (256 ) (3.8 )%
Advanced Energy 2,629 607 2,022 333.1 % OEM 768 1,007
(239 ) (23.7 )% Total $ 9,916 $ 8,389 $ 1,527 18.2 %
Total revenue for first quarter 2018 increased $1.5 million, or
18.2%, to $9.9 million, compared to $8.4 million in the first
quarter of 2017. Sales of the Company’s J-Plasma/Renuvion
generators and handpieces were the primary driver of total revenue
growth in first quarter 2018. The year-over-year change in total
revenue by business segment was driven by Advanced Energy segment
sales, offset partially by a decline in Core and OEM segment sales
during the first quarter 2018 period. Advanced Energy segment sales
increased approximately $2.0 million, or 333.1% year-over-year, to
$2.6 million, compared to approximately $0.6 million last year.
Core segment sales decreased approximately $0.3 million, or 3.8%
year-over-year, to $6.5 million, compared to approximately $6.8
million last year. OEM segment sales decreased $0.2 million, or
23.7% year-over-year, to $0.8 million, compared to $1.0 million
last year.
Three Months EndedMarch 31,
Increase/Decrease (In thousands)
2018
2017
$ Change
% Change
Domestic $ 7,973 $ 6,992 $ 981 14.0 % International 1,943
1,397 546 39.1 % Total $ 9,916 $ 8,389 $ 1,527 18.2 %
Revenue in the United States increased approximately $1.0
million, or 14.0% year-over-year, to $8.0 million, and
international revenue increased approximately $0.5 million, or
39.1% year-over-year, to $1.9 million. International sales growth
in the first quarter was primarily driven by sales to international
distributors in the Company's Advanced Energy segment.
Gross profit for the first quarter of 2018 increased $0.8
million, or 18.1% year-over-year, to $5.0 million, compared to $4.2
million for first quarter of 2017. The increase in first quarter
2018 gross profit was driven by strong sales in the Company’s
Advanced Energy segment. Gross margin for the first quarter of 2018
was 50.3%, compared to 50.4% last year. The year-over-year change
in gross margin was driven by strong Advanced Energy sales, offset
by lower margins in the Company’s OEM and Core segments.
Operating expenses for the first quarter of 2018 decreased
approximately $0.1 million, or 1.8% year-over-year, to $5.9
million, compared to $6.0 million for the first quarter of 2017.
The year-over-year change in operating expenses was primarily
driven by a $0.3 million increase in selling, general and
administrative expenses and a $0.1 million increase in professional
services expense, offset by a $0.3 million decrease in salaries and
related expense and a $0.1 million decrease in research and
development expenses.
Loss from operations for first quarter 2018 was $0.9 million,
compared to a loss from operations of $1.7 million for the
comparable period last year.
Net loss attributed to common shareholders for first quarter
2018 was $0.9 million, or $0.03 per diluted share, compared to a
loss of $1.7 million, or $0.06 per diluted share, for the first
quarter of 2017.
As of March 31, 2018, the Company had cash and equivalents
of $9.4 million as compared to $10.7 million as of
December 31, 2017. The Company had working capital of $16.0
million as of March 31, 2018 as compared to $16.6 million as
of December 31, 2017.
2018 Outlook:
The Company is reaffirming its financial guidance, which was
introduced on March 12, 2018.
For the fiscal year 2018, the Company continues to expect:
- Total revenue in the range of $41.0
million to $42.5 million, representing growth of 5% to 9%
year-over-year. The Company expects total revenue growth to be
driven by Advanced Energy sales growth in the range of
approximately 40% to 45% year-over-year.
- The Company expects adjusted EBITDA in
a range of $1.0 million to $1.5 million.
Conference Call
Details:
Management will host a conference call at 4:30 p.m. Eastern Time
on May 14, 2018 to discuss the results of the quarter and to
host a question and answer session. To listen to the call by phone,
interested parties within the U.S. may dial 844-507-6493 (or
647-253-8641 for international callers) and provide access code
1784708. Participants should ask for the Bovie Medical Corporation
Call. A live webcast of the call will be accessible via the
Investor Relations section of the Company’s website and at:
https://event.on24.com/wcc/r/1626820/F9B173E1969EC13E6FEA692F9E0E032A.
A telephonic replay will be available approximately two hours
after the end of the call through May 28, 2018. The replay can be
accessed by dialing 800-585-8367 for U.S. callers or 416-621-4642
for International callers and using the replay access code:
1784708. The webcast will be archived on the Investor Relations
section of the Company's website.
About Bovie Medical
Corporation:
Bovie Medical Corporation is a leading maker of medical devices
and supplies as well as the developer of J-Plasma® (marketed and
sold under the Renuvion™ Cosmetic Technology brand in the cosmetic
surgery market), a patented plasma-based surgical product for
cutting, coagulation and ablation of soft tissue. J-Plasma/Renuvion
technology utilizes a helium ionization process to produce a
stable, focused beam of plasma that provides surgeons with greater
precision, and minimal invasiveness. The new J-Plasma/Renuvion
handpieces with Cool-Coag™ technology deliver the precision of
helium plasma energy, the power of traditional monopolar
coagulation and the efficiency of plasma beam coagulation -
enabling thin-layer ablation and dissection and fast coagulation
with a single instrument, minimizing instrument exchange and
allowing a surgeon to focus on their patient and their procedures.
With Cool-Coag technology, the new J-Plasma/Renuvion handpieces can
deliver three distinctly different energy modalities - further
increasing the utility and versatility of the system. Bovie Medical
Corporation is also a leader in the manufacture of a range of
electrosurgical products and technologies, marketed through both
private labels and the Company’s own well-respected brands (Bovie®,
IDS™ and DERM™) to distributors worldwide. The Company also
leverages its expertise through original equipment manufacturing
(OEM) agreements with other medical device manufacturers. For
further information about the Company and its products, please
refer to the Bovie Medical Corporation website
at www.boviemedical.com.
Cautionary Statement on Forward-Looking
Statements:
Certain matters discussed in this release and oral statements
made from time to time by representatives of the Company may
constitute forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995 and the Federal
securities laws. Although the Company believes that the
expectations reflected in such forward-looking statements are based
upon reasonable assumptions, it can give no assurance that its
expectations will be achieved.
Forward-looking information is subject to certain risks, trends
and uncertainties that could cause actual results to differ
materially from those projected. Many of these factors are beyond
the Company's ability to control or predict. Important factors that
may cause actual results to differ materially and that could impact
the Company and the statements contained in this release can be
found in the Company's filings with the Securities and Exchange
Commission including the Company's Report on Form 10-K for the year
ended December 31, 2017 and subsequent Form 10-Q filings. For
forward-looking statements in this release, the Company claims the
protection of the safe harbor for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995.
The Company assumes no obligation to update or supplement any
forward-looking statements whether as a result of new information,
future events or otherwise.
BOVIE MEDICAL CORPORATION CONSOLIDATED STATEMENTS
OF OPERATIONS
(Unaudited) (In thousands, except per
share data)
Three Months EndedMarch 31, 2018
2017 Sales $ 9,916 $ 8,389 Cost of sales 4,926
4,163
Gross profit 4,990 4,226 Other
costs and expenses: Research and development 562 709 Professional
services 506 390 Salaries and related costs 2,116 2,460 Selling,
general and administrative 2,670 2,404
Total other costs and expenses 5,854
5,963
Loss from operations (864 ) (1,737 ) Interest
expense, net (34 ) (31 ) Change in fair value of derivative
liabilities (26 ) 88
Total other (loss)
income, net (60 ) 57
Loss before income
taxes (924 ) (1,680 ) Income tax expense 11
5
Net loss $ (935 ) $ (1,685 ) Loss per
share Basic $ (0.03 ) $ (0.05 ) Diluted $ (0.03 ) $ (0.06 )
Weighted average number of shares outstanding - basic 32,878 30,860
Weighted average number of shares outstanding - dilutive 32,878
30,887
BOVIE MEDICAL CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited) (In thousands, except share
and per share data)
March 31, 2018 December
31, 2017 ASSETS Current assets: Cash and
cash equivalents $ 8,701 $ 9,949 Restricted cash 660 719 Trade
accounts receivable, net of allowance of $147 and $204 5,143 4,857
Inventories, net 6,709 6,526 Prepaid expenses and other current
assets 522 496
Total current
assets 21,735 22,547 Property and equipment, net 6,338 6,408
Brand name and trademark 1,510 1,510 Purchased technology and
license rights, net 189 179 Goodwill 185 185 Deposits 91 92 Other
assets 64 67
Total assets $
30,112 $ 30,988
LIABILITIES AND
STOCKHOLDERS' EQUITY Current liabilities: Accounts
payable $ 2,097 $ 1,583 Accrued severance and related 948 1,242
Accrued payroll 198 447 Current portion of mortgage note payable
239 239 Accrued and other liabilities 2,212
2,462
Total current liabilities 5,694 5,973 Mortgage
note payable, net of current portion 2,395 2,455 Note payable 140
140 Deferred tax liability 368 368 Derivative liabilities 46
20
Total liabilities 8,643 8,956
STOCKHOLDERS' EQUITY Common stock, $0.001 par value;
75,000,000 shares authorized; 33,021,170 issued and 32,878,091
outstanding as of March 31, 2018 and December 31, 2017 33 33
Additional paid-in capital 50,867 50,495 Accumulated deficit
(29,431 ) (28,496 )
Total stockholders' equity
21,469 22,032
Total liabilities and
stockholders' equity $ 30,112 $ 30,988
BOVIE MEDICAL CORPORATION RECONCILIATION OF GAAP
NET INCOME/(LOSS) RESULTS TO NON-GAAP ADJUSTED EBITDA/(LOSS)
(Unaudited) (In thousands)
Use of Non-GAAP Financial Measures
We present these non-GAAP measures because we believe these
measures are useful indicators of our operating performance. Our
management uses these non-GAAP measures principally as a measure of
our operating performance and believes that these measures are
useful to investors because they are frequently used by analysts,
investors and other interested parties to evaluate companies in our
industry. We also believe that these measures are useful to our
management and investors as a measure of comparative operating
performance from period to period.
The Company has presented the following non-GAAP financial
measures in this press release: adjusted EBITDA. The Company
defines adjusted EBITDA as its reported net income/(loss) (GAAP)
plus income tax expense, interest expense, net, depreciation and
amortization, stock-compensation expense, and changes in value of
derivative liabilities.
Three Months EndedMarch 31, 2018
2017 Net loss GAAP Basis $ (935 ) $ (1,685 ) Interest
expense, net 34 31 Income tax expense 11 5 Depreciation and
amortization 199 178 Stock based compensation 372 159 Change in
fair value of derivative liabilities 26 (88 )
Adjusted EBITDA (293 ) (1,400 )
The following unaudited table presents a reconciliation of net
loss to Adjusted EBITDA for our 2018 guidance:
Year Ended2018 Net loss GAAP Basis $ (1,100 )
Interest expense, net 150 Income tax expense — Depreciation and
amortization 700 Stock based compensation 1,500 Change in fair
value of derivative liabilities — Adjusted EBITDA
1,250
The reconciliation assumes the mid-point of the Adjusted EBITDA
loss range and the midpoint of each component of the
reconciliation, corresponding to guidance of $1.0 million to $1.5
million for 2018.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20180514006046/en/
Investor Relations
Contact:Westwicke Partners on behalf of Bovie
Medical CorporationMike Piccinino,
CFA443-213-0500investor.relations@boviemed.com
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