Lombard Medical Reports 2015 Third Quarter, Nine-Month Results
IRVINE, Calif., Nov. 4, 2015 (GLOBE NEWSWIRE) -- Lombard Medical, Inc. (NASDAQ:EVAR), a medical device company focused on endovascular aneurysm repair (EVAR) of abdominal aortic aneurysms (AAAs), today reported financial results and provided an operational update for the third quarter and nine months ended September 30, 2015.
Q3 and Recent Operational Highlights
- Total 2015 third quarter Aorfix™ revenue was $4.2 million and, year to date, Aorfix revenue grew 42.9 percent compared to the first nine months of 2014.
- U.S. Aorfix revenue grew to $1.1 million in the third quarter of 2015, up 6.4 percent from $1.0 million in the third quarter of 2014.
- Gross margin for the 2015 third quarter was 48.8 percent compared to 42.9 percent for the prior year period.
- Within a year of Aorfix regulatory approval in Japan last August, physicians have completed approximately 400 cases – representing 5 percent of all AAA cases in Japan.
- In July, Lombard acquired Altura Medical, a privately held, venture-backed company that has developed an innovative ultra-low profile endovascular stent graft technology that offers a simple and predictable solution for the treatment of standard AAA anatomies.
Operational and Financial Results
Global Aorfix revenue was $4.2 million in the third quarter of 2015 compared to $4.3 million in the third quarter of 2014. On a constant currency basis, 2015 third quarter revenue increased 1.6 percent over the prior year. For the first nine months of 2015, global Aorfix revenue grew 42.9 percent to $12.2 million compared to $8.5 million in the year-earlier period. On a constant currency basis, year-to-date revenue grew by $4.1 million, or 48.2 percent.
Gross margin for the 2015 third quarter and first nine months was 48.8 percent and 49.2 percent, respectively, compared to 42.9 percent and 41.4 percent for the prior year periods.
In the U.S., where Aorfix is sold exclusively through the Company's own sales force, revenue in the 2015 third quarter and first nine months was $1.1 million and $3.4 million, respectively. Comparative U.S. revenue in the 2014 third quarter and first nine months was $1.0 million and $2.1 million, respectively.
CEO Simon Hubbert said, "The third quarter acquisition of Altura Medical is a major strategic move for Lombard. We expect the addition of the Altura product will allow us to significantly grow revenue in the near term in our international markets and provide an excellent complement to Aorfix going forward. Japan was again the commercial highlight with a 34.7 percent sequential growth in cases completed during the third quarter over the second quarter. On the regulatory front, next month we will submit for U.S. regulatory approval our new IntelliFlex™ LP delivery system. We are also preparing for two exciting new product launches starting with Altura in Europe in January and IntelliFlex on the Aorfix platform in the U.S. in the second quarter of 2016."
In Japan, where Aorfix is sold through the Company's exclusive distributor, Medico's Hirata, and where regulatory approval was received in August 2014, revenue in the 2015 third quarter and first nine months was $1.9 million and $4.5 million, respectively. Comparative revenue in Japan in the prior year periods was $1.6 million for both periods related to an initial stocking order.
Total operating expenses for the 2015 third quarter and first nine months were $11.4 million and $33.4 million, respectively, compared to $10.5 million and $30.7 million in the prior year periods. The net loss for the third quarter of 2015 was $8.5 million, or $0.45 loss per share, compared to a net loss of $8.5 million, or $0.52 loss per share, for the third quarter of 2014. The net loss for the first nine months of 2015 was $26.2 million, or $1.54 loss per share, compared to $26.5 million, or $1.89 loss per share, for the first nine months of 2014.
The Company's balance sheet as of September 30, 2015 showed total cash and cash equivalents of $36.7 million.
Company Outlook
Due to a delay in launching the IntelliFlex LP delivery system until 2016, the Company expects international distributors to deplete their existing inventories of current delivery systems in preparation for the IntelliFlex launch.
Based on global market conditions and the impact of the IntelliFlex delay, the Company has revised its outlook and now expects revenue for 2015 of between $15 - 16 million.
Conference Call
Lombard's management will discuss the Company's financial results for the third quarter and nine months ended September 30, 2015 and provide a general business update during a conference call beginning at 4:30 p.m. Eastern Time today, Wednesday, November 4, 2015. To join the call, participants may dial 1-855-327-6837 (domestic), 0808-101-2791 (UK toll-free) or 1-631-891-4304 (international). To listen to a live webcast of the conference call, visit the Events and Presentations page under the Investors tab at www.lombardmedical.com.
An archived replay of the webcast will be available shortly following the completion of the call on the Events and Presentations page under the Investors tab at www.lombardmedical.com.
About Lombard Medical, Inc.
Lombard Medical, Inc. is an Irvine, CA-based medical device company focused on the $1.6bn market for minimally invasive treatment of abdominal aortic aneurysms (AAAs). The Company has global regulatory approval for Aorfix™, an endovascular stent graft which has been specifically designed to treat patients with the broadest range of AAA anatomies, including aortic neck angulation up to 90 degrees. The Company has also achieved CE Mark for the Altura™ endograft system, an innovative ultra-low profile endovascular stent graft that offers a simple and predictable solution for the treatment of more standard AAA anatomies. Altura will be launched in Europe in January 2016, with an international rollout planned for later in 2016. For more information, please visit www.lombardmedical.com.
Forward-Looking Statements
This announcement contains forward-looking statements that reflect the Company's current expectations regarding future events. These forward-looking statements generally can be identified by the use of words or phrases such as "believe," "expect," "future," "anticipate," "look forward to," "intend," "plan," "foresee," "may," "should," "will," "estimates," "outlook," "potential," "optimistic," "confidence," "continue," "evolve," "expand," "growth" or words and phrases of similar meaning. Statements that describe objectives, plans or goals also are forward-looking statements. Forward-looking statements are subject to risks, management assumptions and uncertainties. Actual results could differ materially from those projected herein and depend on a number of factors, including the success of the Company's research and development and commercialization strategies, the uncertainties related to the regulatory process and the acceptance of the Company's products by hospitals and other medical professionals, the uncertainty of estimated revenues and profits, the uncertainty of current domestic and international economic conditions that could adversely affect the level of demand for the Company's products and increased volatility in foreign exchange rates, the inability to raise additional funds, and the risks, uncertainties and other factors described under the heading "Risk Factors" in the Company's Form 20-F filed with the Securities and Exchange Commission dated April 29, 2015. Readers are urged to consider these factors carefully in evaluating the forward-looking statements. The forward-looking statements included herein are made only as of the date of this report and the Company undertakes no obligation to update these statements in the future.
| Consolidated Statements of Comprehensive Income | ||||
| for the three and nine month periods ended September 30, 2015 (unaudited) | ||||
| Three months ended | Nine months ended | |||
| September 30, | September 30, | |||
| 2015 | 2014 | 2015 | 2014 | |
| $'000 | $'000 | $'000 | $'000 | |
| Revenue | 4,227 | 4,268 | 12,171 | 8,519 |
| Cost of sales | (2,164) | (2,435) | (6,183) | (4,988) |
| Gross profit | 2,063 | 1,833 | 5,988 | 3,531 |
| Gross margin | 49 % | 43 % | 49 % | 41 % |
| Selling, marketing and distribution expenses | (5,384) | (5,628) | (17,331) | (15,578) |
| Research and development expenses | (2,915) | (2,630) | (7,961) | (6,476) |
| Administrative expenses | (3,144) | (2,290) | (8,069) | (7,183) |
| Initial Public Offering expenses | -- | -- | -- | (1,503) |
| Total operating expenses | (11,443) | (10,548) | (33,361) | (30,740) |
| Operating loss | (9,380) | (8,715) | (27,373) | (27,209) |
| Finance income-interest receivable | 32 | 60 | 114 | 189 |
| Finance costs | (335) | (24) | (591) | (59) |
| Loss before taxation | (9,683) | (8,679) | (27,850) | (27,079) |
| Taxation | 1,223 | 201 | 1,651 | 610 |
| Loss for the period | (8,460) | (8,478) | (26,199) | (26,469) |
| Other comprehensive income: | ||||
| Items that will not be reclassified to profit or loss | ||||
| Currency translation differences | (938) | (3,752) | (688) | (1,986) |
| Total comprehensive loss for the period | (9,398) | (12,230) | (26,887) | (28,455) |
| Basic and diluted loss per ordinary share (cents) from continuing operations | (45.2) | (52.4) | (153.8) | (189.0) |
| Consolidated Balance Sheet | ||
| as at September 30, 2015 (unaudited) | ||
| September 30, | December 31, | |
| 2015 | 2014 | |
| $'000 | $'000 | |
| Assets | ||
| Intangible assets | 24,247 | 1,970 |
| Goodwill | 13,418 | 3,289 |
| Property, plant and equipment | 3,185 | 3,087 |
| Other receivables | 373 | 348 |
| Non-current assets | 41,223 | 8,694 |
| Inventories | 5,709 | 4,895 |
| Trade and other receivables | 5,084 | 3,911 |
| Taxation recoverable | 2,705 | 2,065 |
| Cash and cash equivalents | 36,694 | 53,334 |
| Current assets | 50,192 | 64,205 |
| Total assets | 91,415 | 72,899 |
| Liabilities | ||
| Trade and other payables | (7,896) | (5,434) |
| Borrowings | (1,497) | -- |
| Current liabilities | (9,393 | (5,434) |
| Contingent consideration | (9,060) | -- |
| Borrowings | (17,092) | (2,632) |
| Deferred tax liabilities | (1,595) | -- |
| Non-current liabilities | (27,747) | (2,632) |
| Total Liabilities | (37,140) | (8,066) |
| Net assets | 54,275 | 64,833 |
| Equity | ||
| Called up share capital | 199 | 162 |
| Share premium account | 63,853 | 49,608 |
| Capital reorganization reserve | 205,686 | 205,686 |
| Translation reserve | 1,557 | 2,245 |
| Accumulated loss | (217,020) | (192,868) |
| Total equity | 54,275 | 64,833 |
| Consolidated Cash Flow Statements | ||
| for the nine-month period ended September 30, 2015 (unaudited) | ||
| Nine months ended | ||
| September 30, | ||
| 2015 | 2014 | |
| $'000 | $'000 | |
| Loss before taxation | (27,850) | (27,079) |
| Depreciation and amortization of licenses, software and property plant and equipment | 1,336 | 834 |
| Share-based compensation expense | 2,047 | 1,527 |
| Loss on disposal of tangible assets | 66 | -- |
| Initial Public Offering expenses | -- | 1,503 |
| Net finance expense/(income) | 477 | (130) |
| Increase in inventories | (917) | (2,233) |
| Increase in receivables | (1,238) | (131) |
| (Decrease)/increase in payables | (397) | 505 |
| Net cash used in operating activities | (26,476) | (25,204) |
| Research and development tax credits | 967 | 1,188 |
| Net cash outflow from operating activities | (25,509) | (24,016) |
| Cash flows from investing activities | ||
| Interest received | 71 | 101 |
| Purchase of property, plant and equipment | (1,017) | (1,519) |
| Cash paid for acquisition | (200) | -- |
| Purchase of intangible assets | (15) | (245) |
| Net cash flows used in investing activities | (1,161) | (1,663) |
| Cash flows from financing activities | ||
| Interest paid | (325) | -- |
| Proceeds from issue of loan notes | 16,500 | -- |
| Loan notes transaction costs | (413) | -- |
| Loan notes repaid | (5,331) | -- |
| Proceeds from issue of ordinary shares | -- | 55,000 |
| Share issue expenses | -- | (6,845) |
| Net cash flows from financing activities | 10,431 | 48,155 |
| (Decrease)/increase in cash and cash equivalents | (16,239) | 22,476 |
| Cash and cash equivalents at beginning of year | 53,334 | 40,866 |
| Effects of exchange rates on cash and cash equivalents | (401) | (1,749) |
| Cash and cash equivalents at end of year | 36,694 | 61,593 |
CONTACT: Lombard Medical, Inc. Simon Hubbert, Chief Executive Officer Tel: +1 949 379 3750 / +44 (0)1235 750 800 William J. Kullback, Chief Financial Officer Tel: +1 949 748 6764 Pure Communications Matthew H Clawson Tel: +1 949 370 8500 / matt@purecommunicationsinc.com Susan Heins (Media) Tel: +1 864 286 9597 / sjheins@purecommunicationsinc.com
Help employers find you! Check out all the jobs and post your resume.