Press Release
Asensus Surgical, Inc. Reports Operating and Financial Results for the Third Quarter 2023
Recent Highlights
- 17% growth in surgical procedures, with over 2,700 procedures performed globally year to date at
September 30, 2023 - Two Senhance Surgical programs initiated in the quarter, with two programs initiated subsequent to the end of the third quarter, bringing the year-to-date total to five
- The Company had cash and cash equivalents and short-term investments, excluding restricted cash, of approximately
$33.1 million atSeptember 30, 2023
"I'm pleased with the progress we've made and the strong foundation we are building for the future. We anticipate reaching important milestones in the upcoming quarters,” said
2023 Milestones
During the third quarter of 2023, the Company achieved the following developmental milestones:
- Finalized manufacturing strategy with Flex for LUNA Surgical System
- Finalized strategic relationship with NVIDIA as our graphics hardware provider
During the last quarter of 2023, the Company continues to expect to achieve the following developmental milestones:
- Complete integrated system testing for our LUNA Surgical System
- Conduct preclinical evaluation for our LUNA Surgical System
- Finalize manufacturing partner for the updated Intelligent Surgical Unit™ (ISU™) platform
For the full year 2023, the Company now expects to initiate 8 - 10 new Senhance programs, revised from the previous estimate.
LUNA System
The LUNA System's development is in progress and is now entering the testing and evaluation phase before regulatory submissions. Preclinical evaluation is on track to be completed in December this year with seven
Market Development
Procedure Volumes
Year to date ended
2023 Senhance Program Initiations
Year to date, the Company initiated five new Senhance Surgical System placements or sales, which consisted of two in
In August, the Company initiated a program with
In July,
After the close of the third quarter, the Company placed one additional system and sold a second system.
Third Quarter Financial Results
For the three months ended
For the three months ended
For the three months ended
Adjusted net loss is a non-GAAP financial measure. See the reconciliation of GAAP to Non-GAAP Measures below. For the three months ended
Balance Sheet Updates
The Company had cash and cash equivalents and short-term investments, excluding restricted cash, of approximately
In July, a registered direct offering was successfully completed, yielding approximately
Based on the recent financing and our current operating plan, the Company anticipates that available cash will now sustain operations until the late second quarter of 2024.
Conference Call
To listen to the conference call on your telephone, please dial 1-888-886-7786 for domestic callers and 1-416-764-8658 for international callers, approximately ten minutes prior to the start time. To access the live audio webcast or archived recording, use the following link https://ir.asensus.com/events-and-presentations. The replay will be available on the Company’s website.
About
Based upon the foundations of digital laparoscopy and the Senhance® Surgical System, the Company is developing the LUNA™ Surgical System, a next generation robotic and instrument system as a foundation of its digital surgery solution. These systems are and will be powered by the Intelligent Surgical Unit to increase surgeon control and reduce surgical variability. With the addition of machine vision, augmented intelligence, and deep learning capabilities throughout the surgical experience, we intend to holistically address the current clinical, cognitive and economic shortcomings that drive surgical outcomes and value-based healthcare. The Senhance Surgical System is now available for sale in the US, EU,
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YouTube: https://www.youtube.com/@AsensusSurgical
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Forward-Looking Statements
This press release includes statements relating to
Condensed Consolidated Statements of Operations and Comprehensive Loss (in thousands, except per share amounts) (Unaudited) |
||||||||||||||||
| Three Months Ended |
Nine Months Ended |
|||||||||||||||
| 2023 |
2022 |
2023 |
2022 |
|||||||||||||
| Revenue: | ||||||||||||||||
| Product | $ | 301 | $ | 1,964 | $ | 892 | $ | 2,565 | ||||||||
| Service | 295 | 335 | 779 | 1,067 | ||||||||||||
| Lease | 493 | 264 | 1,475 | 991 | ||||||||||||
| Total revenue | 1,089 | 2,563 | 3,146 | 4,623 | ||||||||||||
| Cost of revenue: | ||||||||||||||||
| Product | 1,171 | 3,057 | 4,008 | 4,316 | ||||||||||||
| Service | 581 | 365 | 1,849 | 1,506 | ||||||||||||
| Lease | 1,117 | 982 | 3,033 | 2,752 | ||||||||||||
| Total cost of revenue | 2,869 | 4,404 | 8,890 | 8,574 | ||||||||||||
| Gross loss | (1,780 | ) | (1,841 | ) | (5,744 | ) | (3,951 | ) | ||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 9,290 | 6,741 | 28,409 | 20,422 | ||||||||||||
| Sales and marketing | 4,138 | 3,615 | 13,140 | 10,936 | ||||||||||||
| General and administrative | 4,571 | 4,853 | 15,163 | 15,378 | ||||||||||||
| Amortization of intangible assets | 114 | 2,398 | 340 | 7,601 | ||||||||||||
| Change in fair value of contingent consideration | 366 | (416 | ) | 674 | (1,168 | ) | ||||||||||
| Property and equipment impairment | — | — | — | 432 | ||||||||||||
| Total Operating Expenses | 18,479 | 17,191 | 57,726 | 53,601 | ||||||||||||
| Operating Loss | (20,259 | ) | (19,032 | ) | (63,470 | ) | (57,552 | ) | ||||||||
| Other income (expense), net: | ||||||||||||||||
| Change in fair value of warrant liabilities | 2,278 | — | 2,278 | — | ||||||||||||
| Interest income | 406 | 291 | 1,276 | 806 | ||||||||||||
| Interest expense | — | (99 | ) | — | (440 | ) | ||||||||||
| Other expense | (686 | ) | (29 | ) | (1,146 | ) | (261 | ) | ||||||||
| Total Other Income, net | 1,998 | 163 | 2,408 | 105 | ||||||||||||
| Loss before income taxes | (18,261 | ) | (18,869 | ) | (61,062 | ) | (57,447 | ) | ||||||||
| Income tax expense | 57 | 55 | 136 | 224 | ||||||||||||
| Net loss | (18,318 | ) | (18,924 | ) | (61,198 | ) | (57,671 | ) | ||||||||
| Net loss per common share attributable to common stockholders – basic and diluted | $ | (0.07 | ) | $ | (0.08 | ) | $ | (0.25 | ) | $ | (0.24 | ) | ||||
| Weighted average number of shares used in computing net loss per common share – basic and diluted | 256,184 | 236,713 | 244,744 | 236,373 | ||||||||||||
| Comprehensive loss: | ||||||||||||||||
| Net loss | (18,318 | ) | (18,924 | ) | (61,198 | ) | (57,671 | ) | ||||||||
| Foreign currency translation (loss) gain | (640 | ) | (1,655 | ) | 84 | (4,018 | ) | |||||||||
| Unrealized gain (loss) on available-for-sale investments | 67 | 86 | 473 | (610 | ) | |||||||||||
| Comprehensive loss | $ | (18,891 | ) | $ | (20,493 | ) | $ | (60,641 | ) | $ | (62,299 | ) | ||||
Condensed Consolidated Balance Sheets (in thousands, except share amounts) (Unaudited) |
||||||||
| 2023 | 2022 | |||||||
| Assets | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 21,699 | $ | 6,329 | ||||
| Short-term investments, available-for-sale | 11,420 | 64,195 | ||||||
| Accounts receivable, net | 662 | 2,256 | ||||||
| Inventory, net | 6,683 | 8,284 | ||||||
| Prepaid expenses | 4,174 | 3,584 | ||||||
| Employee retention tax credit receivable | — | 554 | ||||||
| Other current assets | 1,324 | 1,671 | ||||||
| Total Current Assets | 45,932 | 86,873 | ||||||
| Restricted cash | 1,615 | 1,141 | ||||||
| Long-term investments, available-for-sale | — | 3,865 | ||||||
| Inventory, net of current portion | 5,640 | 5,469 | ||||||
| Property and equipment, net | 9,237 | 9,542 | ||||||
| Intellectual property, net | 1,278 | 1,576 | ||||||
| Deferred tax assets, net | 150 | 174 | ||||||
| Operating lease right-of-use assets, net | 5,004 | 4,950 | ||||||
| Other long-term assets | 1,871 | 2,463 | ||||||
| Total Assets | $ | 70,727 | $ | 116,053 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 4,526 | $ | 3,348 | ||||
| Accrued employee compensation and benefits | 4,967 | 4,508 | ||||||
| Accrued expenses and other current liabilities | 1,258 | 1,293 | ||||||
| Operating lease liabilities, current | 916 | 800 | ||||||
| Deferred revenue | 456 | 465 | ||||||
| Total Current Liabilities | 12,123 | 10,414 | ||||||
| Long-Term Liabilities: | ||||||||
| Warrant liabilities | 4,842 | — | ||||||
| Contingent consideration | 1,930 | 1,256 | ||||||
| Noncurrent operating lease liabilities | 4,579 | 4,738 | ||||||
| Total Liabilities | 23,474 | 16,408 | ||||||
| Commitments and Contingencies | ||||||||
| Stockholders’ Equity | ||||||||
| Common stock |
264 | 237 | ||||||
| Preferred stock, |
— | — | ||||||
| Additional paid-in capital | 970,952 | 962,731 | ||||||
| Accumulated deficit | (922,133 | ) | (860,935 | ) | ||||
| Accumulated other comprehensive loss | (1,830 | ) | (2,388 | ) | ||||
| Total Stockholders’ Equity | 47,253 | 99,645 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 70,727 | $ | 116,053 | ||||
Condensed Consolidated Statements of Cash Flows (in thousands) (Unaudited) |
||||||||
| Nine Months Ended |
||||||||
| 2023 |
2022 |
|||||||
| Operating Activities: | ||||||||
| Net loss | $ | (61,198 | ) | $ | (57,671 | ) | ||
| Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities: |
||||||||
| Depreciation | 2,405 | 2,481 | ||||||
| Amortization of intangible assets | 340 | 7,601 | ||||||
| (Accretion) amortization of discounts and premiums on investments, net | (454 | ) | 556 | |||||
| Stock-based compensation | 5,913 | 6,361 | ||||||
| Deferred tax expense | 136 | 224 | ||||||
| Change in inventory reserves | 297 | 386 | ||||||
| Bad debt expense | — | 9 | ||||||
| Property and equipment impairment | — | 432 | ||||||
| Loss on disposal of property and equipment | — | 97 | ||||||
| Change in fair value of warrant liabilities | (2,278 | ) | — | |||||
| Change in fair value of contingent consideration | 674 | (1,168 | ) | |||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 1,587 | (1,735 | ) | |||||
| Inventory | 536 | (535 | ) | |||||
| Operating lease right-of-use assets | (142 | ) | 237 | |||||
| Prepaid expenses | (590 | ) | (693 | ) | ||||
| Employee retention tax credit receivable | 554 | 164 | ||||||
| Other current and long-term assets | 310 | (2,123 | ) | |||||
| Accounts payable | 1,236 | 449 | ||||||
| Accrued employee compensation and benefits | 566 | 236 | ||||||
| Accrued expenses and other current liabilities | (97 | ) | — | |||||
| Deferred revenue | (5 | ) | (139 | ) | ||||
| Operating lease liabilities | (43 | ) | (53 | ) | ||||
| Net cash and cash equivalents used in operating activities | (50,253 | ) | (44,884 | ) | ||||
| Investing Activities: | ||||||||
| Purchase of available-for-sale investments | (12,268 | ) | (25,588 | ) | ||||
| Proceeds from maturities of available-for-sale investments | 69,835 | 67,702 | ||||||
| Purchase of property and equipment | (488 | ) | (904 | ) | ||||
| Net cash and cash equivalents provided by investing activities | 57,079 | 41,210 | ||||||
| Financing Activities | ||||||||
| Proceeds from issuance of common stock and warrants, net of issuance costs | 9,946 | — | ||||||
| Taxes paid related to net share settlement of vesting of restricted stock units | (497 | ) | (350 | ) | ||||
| Proceeds from exercise of stock options | 5 | 18 | ||||||
| Net cash and cash equivalents provided by (used in) financing activities | 9,454 | (332 | ) | |||||
| Effect of exchange rate changes on cash and cash equivalents | (466 | ) | (300 | ) | ||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 15,814 | (4,306 | ) | |||||
| Cash, cash equivalents and restricted cash, beginning of period | 7,470 | 19,283 | ||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 23,284 | $ | 14,977 | ||||
| Supplemental Disclosure for Cash Flow Information: | ||||||||
| Cash paid for leases | $ | 1,067 | $ | 729 | ||||
| Cash paid for taxes | $ | 230 | $ | 79 | ||||
| Supplemental Schedule of Non-cash Investing and Financing Activities: | ||||||||
| Transfer of inventories to property and equipment | $ | 2,227 | $ | 1,293 | ||||
| Lease liabilities arising from obtaining right-of-use assets | $ | 796 | $ | 316 | ||||
Reconciliation of Non-GAAP Measures Adjusted Net Loss and Adjusted Net Loss per Share (in thousands except per share amounts) (Unaudited) |
|||||||||||||||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||
| Net loss attributable to common stockholders (GAAP) | $ | (18,318 | ) | $ | (18,924 | ) | $ | (61,198 | ) | $ | (57,671 | ) | |||||||||
| Adjustments | |||||||||||||||||||||
| Amortization of intangible assets (a) | 114 | 2,398 | 340 | 7,601 | |||||||||||||||||
| Change in fair value of contingent consideration (b) |
366 | (416 | ) | 674 | (1,168 | ) | |||||||||||||||
| Impairment of property and equipment (c) | — | — | — | 432 | |||||||||||||||||
| Change in fair value of warrant liabilities (d) | 2,278 | — | 2,278 | — | |||||||||||||||||
| Adjusted net loss attributable to common stockholders (Non-GAAP) | $ | (15,560 | ) | $ | (16,942 | ) | $ | (57,906 | ) | $ | (50,806 | ) | |||||||||
| Three Months Ended | Nine Months Ended | ||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||
| Net loss per share attributable to common stockholders (GAAP) | $ | (0.07 | ) | $ | (0.08 | ) | $ | (0.25 | ) | $ | (0.24 | ) | |||||||||
| Adjustments | |||||||||||||||||||||
| Amortization of intangible assets (a) | — | 0.01 | — | 0.03 | |||||||||||||||||
| Change in fair value of contingent consideration (b) | — | — | — | — | |||||||||||||||||
| Impairment of property and equipment (c) | — | — | — | — | |||||||||||||||||
| Change in fair value of warrant liabilities (d) | 0.01 | — | 0.01 | — | |||||||||||||||||
| Adjusted net loss per share attributable to common stockholders (Non-GAAP) | $ | (0.06 | ) | $ | (0.07 | ) | $ | (0.24 | ) | $ | (0.21 | ) | |||||||||
The non-GAAP financial measures for the three and nine months ended
a) Intangible assets that are amortized consist of developed technology and purchased patent rights recorded at cost and amortized over 7 to 10 years.
b) Contingent consideration in connection with the acquisition of the Senhance System in 2015 is recorded as a liability and is the estimate of the fair value of potential milestone payments related to business acquisitions. Contingent consideration is measured at fair value using a Monte-Carlo simulation utilizing significant unobservable inputs including the probability of achieving each of the potential milestones, revenue volatility, EURO to USD exchange rate, and an estimated discount rate associated with the risks of the expected cash flows attributable to the various milestones. Significant increases or decreases in any of the probabilities of success or changes in expected timelines for achievement of any of these milestones would result in a significantly higher or lower fair value of these milestones, respectively, and commensurate changes to the associated liability. The contingent consideration is revalued at each reporting period and changes in fair value are recognized in the consolidated statements of operations and comprehensive loss.
c) Property and equipment impairment associated with returned Senhance Systems under operating leases that are not expected to generate future cash flows sufficient to recover their net book value.
d) During the three months ended
Warrant liabilities were recorded at their initial estimated fair value. Adjustments associated with changes in fair value of the warrant liabilities are included in the Company’s condensed consolidated statements of operations and comprehensive loss.
INVESTOR CONTACT:
ICR Westwicke
invest@asensus.com
443-213-0499
MEDIA CONTACT:
AsensusPR@matternow.com
617-874-5488
Source: Asensus Surgical, Inc.