Aurora Spine Files Condensed Consolidated Financial Statements For The Three And Six Months Ended June 30, 2017
CARLSBAD, Calif., Aug. 25, 2017 (GLOBE NEWSWIRE) -- Aurora Spine Corporation (“Aurora Spine” or the “Company”) (TSXV:ASG) announces financial results for the three and six months ended June 30, 2017.
To our Shareholders:
During the six months ended June 30, 2017 we generated revenues in the amount of $2,962,401 compared to $3,442,217 during the same period the previous year, a decrease of 14%. The primary drivers of this reduction were:
- A reduction of approximately $412k in Biologics sales. These sales were predominantly through one hospital where a change of control occurred and Aurora was required to amend payment terms. We do not see Biologics sales returning to previous levels; and
- A reduction attributable to a change in the distribution model and pricing with one of the Company’s key, high volume surgeons. The Company expects that the shortfall in sales from this situation will be fully replaced by year end.
During Q2 2017, we continued to expand the availability of our family of products in our Screwless Procedure™, a cutting-edge surgical approach to spine fusion. The Screwless Procedure features: our patented ZIP® MIS Fusion System, our TiNano® Interbody cages, and our COMPASS 4D™ retractor system.
Highlights from Q2 2017
- On April 6, 2017, the Company completed a non-brokered private placement of common shares (the “April 2017 Offering”). Pursuant to the April 2017 Offering, the Company issued 1,670,000 common shares at a price of CDN$0.18 (US$ 0.1349) per share for aggregate gross proceeds of CDN$300,600 (US$ 225,209). Share issuance costs totalled CDN$2,246 (US$1,763). A director of the Company subscribed for an aggregate of 835,000 common shares for cash consideration of CDN$150,300 (US$ 112,642).
- On April 12, 2017, the Company announced the issuance of its United States Patent entitled, “Polyaxial Interspinous Fusion Implant and Bone Growth Stimulation System”. In addition to Aurora’s implant family of ZIP® ISPs, including its ZIP Ultra®, ZIP 51™, ZIP LP™, Dyna-ZIP™ and ZIP-Flex, this patent application covers the company’s first polyaxial implant design.
The polyaxial ZIP® Interspinous patent issuance is another milestone in Aurora Spine’s history. Our latest patent was issued for our newest interspinous device design that permits for full polyaxial maneuverability of the implant components in difficult situations during minimally invasive fusion cases. This newly issued patent features our patented ONE-STEP™ locking mechanism that eliminates the use of a set screw in Aurora’s Screwless Procedure™ surgeries.
- On April 14, 2017, the Company signed a new lease with its landlord which terminates the original lease effective May 31, 2017. The new lease terms are effective June 1, 2017 and terminate on March 31, 2023. The new lease reduces the monthly rent from $28,718 for 17,288 square feet to $15,000 for 5,464 square feet for the first 22 months which includes a termination fee and Common Area Maintenance (“CAM”) charges. Beginning at month 23, the monthly payment decreases further to $7,879 plus CAM fees and increases by 3% each year beginning at month 25 of the lease.
- On May 31, 2017, the Company announced that it has selected its proprietary implant locking technology covered by United States Patent entitled "POLYAXIAL INTERSPINOUS FUSION IMPLANT AND BONE GROWTH STIMULATION SYSTEM" for out-licensing opportunities for medical and industrial applications.
The Company is now offering its new Polyaxial ZIP® Interspinous device patent for out-licensing or private label opportunities. The combination of the proven ONE-STEP™ locking mechanism, with no setscrew, and the polyaxial feature may be a unique opportunity in new product development for orthopedic and other medical and industrial manufacturers. The patented features offer new design directions for hardware connections that do not rely on conventional threads and screws thus preventing hardware loosening related problems.
SELECTED BALANCE SHEET INFORMATION
The following table summarizes selected key financial data.
| As at | June 30, 2017 $ | December 31, 2016 $ |
| Cash | 107,849 | 192,842 |
| Trade receivables | 1,047,308 | 1,228,553 |
| Prepaid expenses and deposits | 181,496 | 318,386 |
| Inventory | 2,867,249 | 2,996,940 |
| Current assets | 4,203,902 | 4,736,721 |
| Intangible assets | 271,950 | 210,966 |
| Property and equipment | 1,683,800 | 2,095,565 |
| Total assets | 6,159,652 | 7,043,252 |
| Current liabilities | 2,056,041 | 2,400,196 |
| Long-term liabilities | 1,377,963 | 1,172,963 |
| Common share equity | 19,582,424 | 19,358,978 |
The Screwless Procedure has been developed to increase the possibility of significant benefits to patients, hospitals, and surgeons, including reduced surgery time, less blood loss, shorter hospital stays, and significantly faster recovery time. These benefits will continue to be the driving force of Aurora Spine’s competitive advantage and growth.
In Q2 2017, we continued driving growth by training surgeons and distributors on Aurora Spine’s unique technology and increasing the reach of our sales force.
In Q3 2017, we will focus on:
- Aggressively continuing our strategy of building a revenue base in the U.S. market. We will accomplish this by expanding product usages with our current distribution network, developing new distribution channels and training new surgeons on the Aurora product advantages; and
- Expanding our direct sales teams in the US.
We expect that these initiatives will create value for our shareholders. Management and I thank our shareholders for their continued support in these endeavors. We will look to extend our technology position further with minimally disruptive procedural solutions for the spine.
None of this would be possible without the dedication and commitment of our hardworking colleagues at Aurora. I want to thank them for the great accomplishments they have made this year, for Aurora and ultimately, for patients. They have embraced change and risen to the numerous challenges before them, and I am grateful for their ongoing support of our company and our mission.
I would also like to thank you, our investors, for your continued support. Together, we have built a strong foundation, and I look forward to the opportunities ahead of us. I am truly grateful to be part of an organization that makes such a positive improvement in the lives of patients around the world.
The statements together with the Management Discussion and Analysis can be found on SEDAR at www.sedar.com.
Trent J. Northcutt
President and Chief Executive Officer
About Aurora Spine
Aurora Spine is an early stage company focused on bringing new solutions to the spinal implant market through a series of screwless, innovative, minimally invasive, regenerative spinal implant technologies. Aurora Spine continues to position itself at the forefront of spinal surgery procedures, focusing on minimally invasive spine surgery technologies. Aurora Spine is changing spine surgery by focusing on disruptive technologies following the Company's commitment to - Simplifying the Complex.
Forward-Looking Statements
This news release contains forward-looking information that involves substantial known and unknown risks and uncertainties, most of which are beyond the control of Aurora Spine, including, without limitation, those listed under "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Information" in Aurora Spine's final prospectus (collectively, "forward-looking information"). Forward-looking information in this news release includes information concerning the proposed use and success of the company’s products in surgical procedures. Aurora Spine cautions investors of Aurora Spine's securities about important factors that could cause Aurora Spine's actual results to differ materially from those projected in any forward-looking statements included in this news release. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking and may involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ unilaterally from those expressed in such forward-looking statements. No assurance can be given that the expectations set out herein will prove to be correct and, accordingly, prospective investors should not place undue reliance on these forward looking statements. These statements speak only as of the date of this press release and Aurora Spine does not assume any obligation to update or revise them to reflect new events or circumstances.
For more information, please contact: Aurora Spine Corporation Trent Northcutt President and Chief Executive Officer (760) 424-2004 Sarina Mason Chief Financial Officer (760) 424-2004 www.aurora-spine.com