- Generated $0.8M of Cash from Operating Activities in Q4
2023
- Recorded Lowest Quarter of Non-GAAP Operating Loss Since
Inception, Non-GAAP Operating Loss for Q4 is $3.7 Million, an
Improvement of $2 Million Compared to Q3
- Full Year 2023 Operating Expense of $163.9 Million in Alignment
with Guidance Range of $160 Million to $165 Million
- Global Net Revenue Record of $61.0 Million for the Fourth
Quarter and $202.1 Million Full Year 2023, Representing 40% and 36%
Growth Over the Prior Year; These Results Are Unchanged from the
Preliminary Results Reported on January 16th, 2024
- Company Updates Mid-Term Guidance and Expects to Achieve
Profitability1 for the Fourth Quarter of 2024 and Full Year
2025
Evolus, Inc. (NASDAQ: EOLS), a performance beauty company with a
customer-centric approach focused on delivering breakthrough
products, today announced its financial results for the fourth
quarter and full year ended December 31, 2023.
“2023 was a defining year for Evolus. We achieved record market
share as the fastest growing toxin in the U.S. for the third
consecutive year2, expanded our portfolio globally with the
addition of an innovative late-stage line of facial fillers, and
delivered continued improvement in operating income performance,”
said David Moatazedi, President and Chief Executive Officer of
Evolus. “We expect to be profitable1 for the fourth quarter of 2024
and the full year 2025.”
“As we enter 2024, we are reiterating our full year net revenue
guidance of $255 million to $265 million, which represents 31%
growth at the top end of the range. Looking beyond 2024, we remain
excited about both the continued expansion of our U.S. and
International business with the Jeuveau® and Nuceiva® brands, as
well as the introduction of our highly synergistic Evolysse™ and
Estyme® dermal filler line, further increasing our market
penetration and driving toward our total net revenue goal of at
least $700 million by 2028.”
Fourth Quarter and Full Year 2023 Highlights and Recent
Developments
- The company’s key performance indicators demonstrated continued
strong momentum during the fourth quarter.
- Accounts purchasing Jeuveau® increased by a record high of more
than 840 in the fourth quarter. This is 20% above the year-to-date
quarterly average in the company’s seasonally highest performance
quarter.
- During 2023, more than 2,900 new accounts were added, bringing
the total number of accounts purchasing to date since launch to
more than 12,400. The reorder rate among customers remains
approximately 70%.3
- Enrollment in the Evolus Rewards consumer loyalty program grew
55% in 2023 to end the year at approximately 750,000 consumers.4
This was aided by a record high of over 170,000 total redemptions
in the fourth quarter, driven by continued demand from existing
consumers receiving repeat treatments. Repeat treatments
represented approximately 60% of the total treatments for the
quarter, demonstrating strong brand loyalty.
- Expanded global footprint by successfully commencing the
commercial launch of Nuceiva® in major European markets, including
Germany, Austria and Italy.
Fourth Quarter 2023 Financial Results
- Total net revenues for the fourth quarter of 2023 increased 40%
to $61.0 million from $43.6 million in the fourth quarter of 2022
driven primarily by higher volumes of Jeuveau®.
- Gross profit margin and adjusted gross profit margin were 67.2%
and 68.4%, respectively. Adjusted gross profit margin excludes
amortization of intangible assets.
- Operating expenses for the fourth quarter of 2023 were $69.6
million, compared to $63.5 million in the third quarter of 2023; Q4
2023 operating expenses included $4.4 million of IPR&D expense
related to the Share Issuance for the European Filler License
Agreement.
- Non-GAAP operating expenses for the fourth quarter of 2023 were
$45.5 million, compared to $40.3 million in the third quarter of
2023; Q4 2023 Non-GAAP operating expenses included $4.4 million of
IPR&D expense related to the Share Issuance for the European
Filler License Agreement. Non-GAAP operating expenses exclude
product cost of sales, stock-based compensation expense,
revaluation of the contingent royalty obligation, and depreciation
and amortization.
- Loss from operations for the fourth quarter of 2023 was $8.6
million, compared to $13.4 million in the third quarter of
2023.
- Non-GAAP loss from operations in the fourth quarter of 2023 was
$3.7 million, compared to $5.7 million in the third quarter of
2023. Non-GAAP loss from operations excludes stock-based
compensation expense, revaluation of the contingent royalty
obligation, and depreciation and amortization.
- Cash and cash equivalents on December 31, 2023 were $62.8
million, compared to $38.7 million on September 30, 2023. The cash
balance on December 31, 2023 included additional borrowings of
$25.0 million under the company’s credit facility with Pharmakon;
$0.8 million of cash was generated from operations in the fourth
quarter. This continued improvement in cash generation demonstrates
progress towards cash flow breakeven. Evolus continues to expect
its existing liquidity will fully fund it to sustained
profitability1 in 2025.
Full Year 2023 Financial Results
- Total net revenues for 2023 increased 36% to $202.1 million,
surpassing the top end of the company’s updated guidance of $194
million to $198 million introduced in November 2023, reflecting
increasing consumer demand and market share gains.
- Gross profit margin and adjusted gross profit margin were 68.1%
and 69.5%. Adjusted gross profit margin, which excluded
amortization of intangibles, is aligned with company guidance of
68% to 71%.
- Operating expenses were $251.3 million in 2023, compared to
$213.9 million in 2022. Non-GAAP operating expenses were $163.9
million in 2023 and in alignment with company guidance range of
$160 million to $165 million. Non-GAAP operating expenses for 2022
were $137.7 million. Non-GAAP operating expenses exclude product
cost of sales, stock-based compensation expense, revaluation of the
contingent royalty obligation, and depreciation and
amortization.
- Loss from operations was $49.2 million for 2023, compared to
$65.3 million in 2022. Non-GAAP loss from operations in 2023
decreased by 48% to $23.4 million from $45.0 million in 2022.
Non-GAAP loss from operations excludes stock-based compensation
expense, revaluation of the contingent royalty obligation expense,
and depreciation and amortization.
Outlook
- Evolus expects total net revenues for the full year 2024 to be
between $255 and $265 million, representing year-over-year growth
of 26% to 31% from 2023 results and well above the estimated growth
rate of the aesthetic neurotoxin market.
- Evolus expects its adjusted gross profit margin for the full
year 2024 to be between 68% and 71%, consistent with 2023
guidance.
- Evolus expects its full year non-GAAP operating expenses to be
between $185 and $190 million.
- The company expects to achieve positive non-GAAP operating
income on a consolidated basis for the fourth quarter of 2024 and
for the full year 2025. Within the year 2025, profitability1 may
not be sustained every quarter due to the filler launch. The
company remains fully funded with existing liquidity.
- The company projects its total net revenue can reach at least
$700 million by 2028, a compound annual growth rate of 28% from
2023, based on the combination of its existing aesthetic neurotoxin
business and anticipated launch of the Evolysse™ HA dermal filler
product line beginning in 2025.
- During 2024, Evolus expects to broaden its global footprint by
expanding into additional countries with Nuceiva®, most notably
Australia and Spain.
- Evolus anticipates submitting Premarket Approval (PMA)
applications for the first two Evolysse™ dermal filler products
with the FDA by mid-year 2024 and expects regulatory approvals for
the remaining Estyme® dermal filler products in Europe in late
2024.
1 Within this press release, “profitability” is defined as
achieving positive non-GAAP operating income. 2 Measured by
comparing year-over-year revenue growth of each aesthetic
neurotoxin on the market for the entirety of each comparable year.
3 Represents cumulative statistics from the launch of Jeuveau® in
May 2019 through December 31, 2023. 4 Represents cumulative
statistics from the launch of Evolus Rewards in May 2020 through
December 31, 2023.
Conference Call Information
Management will host a conference call and live webcast to
discuss Evolus’ financial results today at 4:30 p.m. ET. To
participate in the conference call, dial (877) 407-6184 (U.S.) or
(201) 389-0877 (international) or connect to the live webcast via
the link on the Investor Relations page of our website at
www.evolus.com.
Following the completion of the call, an audio replay can be
accessed for 48 hours by dialing (877) 660-6853 (U.S.) or (201)
612-7415 (international) and using conference number 13743722. An
archived webcast, which will remain available for 30 days, can also
be accessed on the Investor Relations page of our website at
www.evolus.com.
About Evolus, Inc.
Evolus (NASDAQ: EOLS) is a global performance beauty company
evolving the aesthetic neurotoxin market for the next generation of
beauty consumers through its unique, customer-centric business
model and innovative digital platform. Our mission is to become a
global, multi-product aesthetics company based on our flagship
product, Jeuveau® (prabotulinumtoxinA-xvfs), the first and only
neurotoxin dedicated exclusively to aesthetics and manufactured in
a state-of-the-art facility using Hi-Pure™ technology. Evolus is
expanding its product portfolio having entered into a definitive
agreement to be the exclusive U.S. distributor of Evolysse™, and
the exclusive distributor in Europe of Estyme®, a line of unique
dermal fillers currently in late-stage development. Visit us at
www.evolus.com, and follow us on LinkedIn, X, Instagram or
Facebook.
Use of Non-GAAP Financial Measures
Evolus’ financial results are prepared in accordance with
accounting principles generally accepted in the United States of
America (“GAAP”). This press release and the reconciliation tables
included in the financial schedules below include adjusted gross
profit, adjusted gross profit margin, non-GAAP operating expenses
and non-GAAP income (loss) from operations. Adjusted gross profit
is calculated as gross profit excluding amortization of an
intangible asset. Adjusted gross profit margin is defined as
adjusted gross profit as a percentage of total net revenues.
Non-GAAP operating expenses and non-GAAP income (loss) from
operations exclude (i) product cost of sales, in the case of
non-GAAP operating expenses only, (ii) the revaluation of
contingent royalty obligations, (iii) stock-based compensation
expense, and (iv) depreciation and amortization. Management
believes that adjusted gross profit margin is an important measure
for investors because management uses adjusted gross profit margin
as a key performance indicator to evaluate the profitability of
sales without giving effect to costs that are not core to our cost
of sales, such as the amortization of an intangible asset.
Management believes that non-GAAP operating expenses and non-GAAP
income (loss) from operations are useful in helping to identify the
company’s core operating performance and enables management to
consistently analyze the period-to-period financial performance of
the core business operations. Management also believes that
non-GAAP operating expenses and non-GAAP income (loss) from
operations will enable investors to assess the company in the same
way that management has historically assessed the company’s
operating expenses against comparable companies with conventional
accounting methodologies. The company’s definitions of adjusted
gross profit, adjusted gross profit margin, non-GAAP operating
expenses and non-GAAP income (loss) from operations have
limitations as analytical tools and may differ from other companies
reporting similarly named measures. Non-GAAP measures should not be
considered measures of financial performance under GAAP, and the
items excluded from such non-GAAP measures should not be considered
in isolation or as alternatives to financial statement data
presented in the financial statements as an indicator of financial
performance or liquidity. Non-GAAP measures should be considered in
addition to results prepared in accordance with GAAP but should not
be considered a substitute for or superior to GAAP results.
For a reconciliation of our historical adjusted gross profit
margin, non-GAAP operating expenses and non-GAAP income (loss) from
operations presented herein to gross profit margin, GAAP operating
expenses and GAAP loss from operations, the most directly
comparable GAAP financial measures, please see “Reconciliation of
Gross Profit Margin to Adjusted Gross Profit Margin,”
“Reconciliation of GAAP Operating Expenses to Non-GAAP Operating
Expenses” and “Reconciliation of GAAP (Loss) from Operations to
Non-GAAP Income (Loss) from Operations” in the financial schedules
below. In addition, this press release includes information
regarding the company’s expected adjusted gross profit margin,
non-GAAP operating expenses and non-GAAP operating income (loss)
for full year 2024. Evolus has not provided a reconciliation of
such forward-looking non-GAAP adjusted gross profit margin,
non-GAAP operating expenses or non-GAAP operating income (loss)
because a reconciliation of such measures to GAAP gross profit
margin, GAAP operating expenses and GAAP loss from operations,
respectively, the most directly comparable GAAP financial measures,
is not available without unreasonable efforts. This is due to the
inherent difficulty of forecasting the timing or amount of various
reconciling items that would impact the forward-looking outlook for
these non-GAAP financial measures that have not yet occurred and/or
cannot be reasonably predicted. Such unavailable information could
have a significant impact on Evolus’ GAAP financial results.
Forward-Looking Statements
This press release contains forward-looking statements as
defined under the Private Securities Litigation Reform Act of 1995
that involve risks and uncertainties, including statements about
future events, our business, financial condition, results of
operations and prospects, our industry and the regulatory
environment in which we operate. Any statements contained herein
that are not statements of historical or current facts are
forward-looking statements. In some cases, you can identify
forward-looking statements by terms such as “anticipate,”
“believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,”
“potential,” “predict,” “project,” “should,” “will,” “would” or the
negative of those terms, or other comparable terms intended to
identify statements about the future. The company’s forward-looking
statements include, but are not limited to, statements related to
market conditions and consumer demand; expectations regarding
regulatory approvals, product launches, and market adoption for the
Evolysse™ and Estyme® dermal filler product lines the company’s
long-term revenue outlook and its financial outlook for 2024; and
the company’s cash position and expectations for reaching
profitability and funding the company’s operations.
The forward-looking statements included herein are based on our
current expectations, assumptions, estimates and projections, which
we believe to be reasonable, and are subject to risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied by the forward-looking statements.
These risks and uncertainties, all of which are difficult or
impossible to predict accurately and many of which are beyond our
control, include, but are not limited to uncertainties associated
with our ability to comply with the terms and conditions in the
Medytox Settlement Agreements, our ability to fund our future
operations or obtain financing to fund our operations, unfavorable
global economic conditions and the impact on consumer discretionary
spending, uncertainties related to customer and consumer adoption
of Jeuveau® and Evolysse™, the efficiency and operability of our
digital platform, competition and market dynamics, our ability to
successfully launch and commercialize our products in new markets,
including the Evolysse™ dermal filler product line in the U.S., our
ability to maintain regulatory approvals of Jeuveau® or obtain
regulatory approvals for new product candidates or indications, our
reliance on Symatese to achieve regulatory approval for the
Evolysse™ dermal filler product line in the U.S., and other risks
described in our filings with the Securities and Exchange
Commission, including in the section entitled “Risk Factors” in our
Annual Report on Form 10-K for the year ended December 31, 2023
expected to be filed with the Securities and Exchange Commission on
or about March 7, 2024. These filings can be accessed online at
www.sec.gov. Readers are cautioned not to place undue reliance on
these forward-looking statements, which speak only as of the date
hereof. Except as required by law, we undertake no obligation to
update or revise any forward-looking statements to reflect new
information, changed circumstances or unanticipated events. If we
do update or revise one or more of these statements, investors and
others should not conclude that we will make additional updates or
corrections.
Jeuveau® and Nuceiva® are registered trademarks of Evolus, Inc.
Evolysse™ is a trademark of Evolus, Inc. Hi-Pure™ is a trademark of
Daewoong Pharmaceutical Co, Ltd.
Evolus, Inc.
Consolidated Statements of
Operations and Comprehensive Loss
(in thousands, except loss per
share data)
Three Months Ended December
31,
Year Ended December
31,
2023
2022
2023
2022
Revenue:
Product revenue, net
$
60,671
$
42,988
$
199,721
$
146,592
Service revenue
328
658
2,364
2,024
Total net revenues
60,999
43,646
202,085
148,616
Operating expenses:
Product cost of sales (excludes
amortization of intangible assets)
19,270
13,370
61,559
55,887
Selling, general and administrative
43,058
36,729
164,944
141,840
Research and development
2,380
1,348
6,556
4,742
In-process research and development
4,428
—
8,869
2,000
Revaluation of contingent royalty
obligation payable to Evolus Founders
(875
)
1,809
4,257
5,755
Depreciation and amortization
1,373
1,027
5,133
3,722
Total operating expenses
69,634
54,283
251,318
213,946
Loss from operations
(8,635
)
(10,637
)
(49,233
)
(65,330
)
Other income (expense):
Interest income
291
77
860
119
Interest expense
(4,075
)
(2,631
)
(13,832
)
(9,097
)
Other income (expense), net
694
84
696
(9
)
Loss before income taxes:
(11,725
)
(13,107
)
(61,509
)
(74,317
)
Income tax (benefit) expense
106
57
176
95
Net loss
$
(11,831
)
$
(13,164
)
$
(61,685
)
$
(74,412
)
Other comprehensive loss:
Unrealized gain (loss), net of tax
179
31
(90
)
(337
)
Comprehensive loss
$
(11,652
)
$
(13,133
)
$
(61,775
)
$
(74,749
)
Net loss per share, basic and diluted
$
(0.21
)
$
(0.23
)
$
(1.08
)
$
(1.33
)
Weighted-average shares outstanding used
to compute basic and diluted net loss per share
57,246
56,266
56,919
56,065
Evolus, Inc.
Summary of Consolidated
Balance Sheet Data
(in thousands)
December 31, 2023
December 31, 2022
Cash and cash equivalents
$
62,838
$
53,922
Accounts receivable, net
30,529
22,448
Inventories
10,998
18,852
Prepaid expenses and other current
assets
8,056
5,580
Total current assets
112,421
100,802
Noncurrent assets
76,577
77,181
Total assets
$
188,998
$
177,983
Accounts payable and accrued expenses
$
38,084
$
33,729
Accrued litigation settlement
—
5,000
Other current liabilities
10,207
7,780
Total current liabilities
48,291
46,509
Term loan, net of discount and issuance
costs
120,359
71,879
Other noncurrent liabilities
41,037
41,096
Total liabilities
$
209,687
$
159,484
Total stockholders’ equity
(deficit)
$
(20,689
)
$
18,499
Evolus, Inc.
Summary of Consolidated Cash
Flows
(in thousands)
Year Ended December
31,
Three Months Ended
December 31,
2023
2022
2023
Net cash (used in) provided by:
Operating activities
$
(34,008
)
*
$
(84,912
)
*
$
813
Investing activities
(1,627
)
(2,939
)
(361
)
Financing activities
44,641
(4,146
)
23,522
Effect of exchange rates on cash
(90
)
(337
)
179
Change in cash and cash equivalents
8,916
(92,334
)
24,153
Cash and cash equivalents, beginning of
period
53,922
146,256
38,685
Cash and cash equivalents, end of
period
$
62,838
$
53,922
$
62,838
* Includes a settlement payment of $5.0 million and $15.0
million to Allergan/Medytox in the twelve months ended December 31,
2023 and 2022, respectively.
Evolus, Inc.
Reconciliation of Gross Profit
Margin to Adjusted Gross Profit Margin
(in thousands)
Three Months Ended
December 31,
Year Ended
December 31,
2023
2022
2023
2022
Total net revenues
$
60,999
$
43,646
$
202,085
$
148,616
Cost of sales:
Product cost of sales (excludes
amortization of intangible assets)
19,270
13,370
61,559
55,887
Amortization of distribution right
intangible asset
739
739
2,955
2,955
Total cost of sales
20,009
14,109
64,514
58,842
Gross profit
40,990
29,537
137,571
89,774
Gross profit margin
67.2
%
67.7
%
68.1
%
60.4
%
Add: Amortization of distribution right
intangible asset
739
739
2,955
2,955
Adjusted gross profit
$
41,729
$
30,276
$
140,526
$
92,729
Adjusted gross profit margin
68.4
%
69.4
%
69.5
%
62.4
%
Evolus, Inc.
Reconciliation of GAAP
Operating Expenses to
Non-GAAP Operating
Expenses
(in thousands)
Three Months Ended
December 31,
Year Ended
December 31,
Three Months Ended
September 30,
2023
2022
2023
2022
2023
GAAP operating expense
$
69,634
$
54,283
$
251,318
$
213,946
$
63,459
Adjustments:
Product cost of sales (excludes
amortization of intangible assets)
19,270
13,370
61,559
55,887
15,431
Revaluation of contingent royalty
obligation
(875
)
1,809
4,257
5,755
1,802
Stock-based compensation:
Included in selling, general and
administrative
4,119
2,329
15,564
10,565
4,295
Included in research and development
278
83
894
268
301
Depreciation and amortization
1,373
1,027
5,133
3,722
1,311
Non-GAAP operating expense
$
45,469
$
35,665
$
163,911
$
137,749
$
40,319
Evolus, Inc.
Reconciliation of GAAP (Loss)
from Operations to
Non-GAAP Income (Loss) from
Operations
(in thousands)
Three Months Ended
December 31,
Year Ended
December 31,
Three Months Ended
September 30,
2023
2022
2023
2022
2023
GAAP (loss) from operations
$
(8,635
)
$
(10,637
)
$
(49,233
)
$
(65,330
)
$
(13,440
)
Adjustments:
Revaluation of contingent royalty
obligation
(875
)
1,809
4,257
5,755
1,802
Stock-based compensation:
Included in selling, general and
administrative
4,119
2,329
15,564
10,565
4,295
Included in research and development
278
83
894
268
301
Depreciation and amortization
1,373
1,027
5,133
3,722
1,311
Non-GAAP (loss) from operations
$
(3,740
)
$
(5,389
)
$
(23,385
)
$
(45,020
)
$
(5,731
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240307539329/en/
Investor Contact: Nareg Sagherian
Vice President, Head of Global Investor Relations and Corporate
Communications Tel: 248-202-9267 Email: ir@evolus.com
Media Contact: Email:
media@evolus.com
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