AxoGen, Inc. (LECT) Reports Second Quarter 2013 Financial Results
7/11/2013 9:52:06 AM
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ALACHUA, FL – July 11, 2013 – AxoGen, Inc. (OTCQB: AXGN), a leading regenerative medicine company focused on the commercialization of proprietary products and technologies for peripheral nerve reconstruction and regeneration, announced financial results for the second quarter ended June 30, 2013.
Karen Zaderej, Chief Executive Officer of AxoGen, said, “The Company achieved another quarter of record revenue driven by solid execution by our sales and marketing team. We also made excellent progress with our initiatives to expand adoption of our full suite of nerve repair products. This included European and Canadian regulatory approval for our AxoGuard® Nerve Protector and AxoGuard® Nerve Connector products. AxoGen continues to demonstrate that we are well positioned to capture the significant opportunity to provide off-the-shelf treatment options for patients with peripheral nerve injuries, which, we believe, will translate into continued sales growth and positive financial results.”
Revenues for the second quarter 2013 were $2.86 million, up 42.2% compared to $2.01 million in the second quarter 2012, driven by an increase in the number of facilities utilizing the Company’s products and increased penetration of existing accounts.
Gross profit for the second quarter 2013 was $2.23 million, up 47.6% compared to $1.51 million in the second quarter 2012. Gross profit margin for the second quarter 2013 was 77.9%, up 2.8% compared to 75.1% in the second quarter 2012. The year-over-year improvement in gross profit and gross margin was primarily attributable to revenue growth and a product price increase implemented during the first quarter 2013, respectively.
Total operating expenses in the second quarter 2013 were $4.42 million, up 42.8% compared to $3.10 million in the second quarter 2012. As a percentage of revenues, operating expenses were up 0.73% in the second quarter 2013 as compared to the same period in 2012.
Second quarter 2013 sales and marketing expense was $2.53 million, up 60.0% compared to $1.58 million in the second quarter 2012. The increase was primarily attributable to increased commissions due to higher sales and the expansion of the Company’s marketing efforts and direct sales force.
Second quarter 2013 general and administrative expense was $1.40 million, up 21.8% compared to $1.15 million in the second quarter 2012. The increase was primarily attributable to increased salary expense and benefits, travel, and public company expenses.
Second quarter 2013 research and development expense was $0.50 million, up 35.7% compared to $0.37 million in the second quarter 2012. The increase was primarily attributable to costs associated with the Company’s investment in clinical studies that support the use and regulatory position of the Company’s products.
Loss from Operations and Net Loss
Operating loss in the second quarter 2013 was $2.20 million, compared to $1.59 million in the second quarter 2012. Net loss in the second quarter 2013 was $3.45 million, or ($0.31) per share, compared to net loss of $1.03 million, or ($0.09) per share, in the second quarter 2012.
As of June 30, 2013, the Company had $8.69 million in cash and cash equivalents and approximately $23.38 million in long-term note payable – revenue interest purchase agreement. AxoGen had working capital of approximately $12.22 million and a current ratio of 8.7 at June 30, 2013, compared to working capital of $16.82 million and a current ratio of 12.4 at December 31, 2012.
AxoGen, Inc. management will provide a review of the second quarter 2013 financial results in conjunction with its Annual Shareholders’ Meeting on Thursday, August 1, 2013, beginning at 1:00 pm ET. Participants can join an interactive broadcast of the Annual Shareholders’ Meeting via the Internet link, www.virtualshareholdermeeting.com/axogen.
Following the live Annual Shareholders’ Meeting, a replay will be available on the “Investors” section of the Company’s website, http://www.axogeninc.com/investors.html.
About AxoGen, Inc.
AxoGen (AXGN) is a leading regenerative medicine company dedicated to advancing the science and commercialization of peripheral nerve repair solutions. The Company’s innovative approach to regenerative medicine has resulted in first-in-class products that we believe will define their product categories. AxoGen’s products offer a full suite of surgical nerve repair solutions including Avance® Nerve Graft, the only off-the-shelf commercially available processed nerve allograft for bridging severed nerves without the comorbidities associated with a second surgical site, AxoGuard® Nerve Connector, a porcine submucosa ExtraCellular Matrix (“ECM”) coaptation aid for tensionless repair of severed nerves, and AxoGuard® Nerve Protector, a porcine submucosa ECM product used to wrap and protect injured peripheral nerves and reinforce the nerve reconstruction while preventing soft tissue attachments.
AxoGuard® Nerve Connector and AxoGuard® Nerve Protector are manufactured in the United States by Cook Biotech Incorporated, West Lafayette, Indiana, and are distributed exclusively by AxoGen. AxoGen is the parent of its wholly owned operating subsidiary, AxoGen Corporation. AxoGen’s principal executive office and operations are located in Alachua, FL. To receive email alerts directly from AxoGen, please click here www.axogeninc.com/emailalerts.html.
Cautionary Statements Concerning Forward-Looking Statements
This Press Release contains “forward-looking” statements as defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations or predictions of future conditions, events or results based on various assumptions and management’s estimates of trends and economic factors in the markets in which we are active, as well as our business plans. Words such as “expects”, “anticipates”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “projects”, “forecasts”, “continue”, “may”, “should”, “will” variations of such words and similar expressions are intended to identify such forward-looking statements. The forward-looking statements may include, without limitation, statements regarding product commercialization and marketing efforts for its portfolio of peripheral nerve repair products, Avance® Nerve Graft, AxoGuard® Nerve Connector and AxoGuard® Nerve Protector, product development, financial performance, sales growth, product adoption, market awareness of our products, data validation and the intent to list on a national securities exchange. The forward-looking statements are subject to risks and uncertainties, which may cause results to differ materially from those set forth in the statements. Forward-looking statements in this release should be evaluated together with the many uncertainties that affect AxoGen’s business and its market, particularly those discussed in the risk factors and cautionary statements in AxoGen’s filings with the Securities and Exchange Commission. Forward-looking statements are not guarantees of future performance, and actual results may differ materially from those projected. The forward-looking statements are representative only as of the date they are made, and AxoGen assumes no responsibility to update any forward-looking statements, whether as a result of new information, future events or otherwise.
Greg Freitag, Chief Financial Officer
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