| | TUCSON, Ariz., Aug. 10, 2023 /PRNewswire/ -- Accelerate Diagnostics, Inc. (Nasdaq: AXDX) today announced financial results for the second quarter for the period ended June 30, 2023. “Throughout the quarter, we’ve significantly advanced our Wave Program,” stated Jack Phillips, CEO of Accelerate Diagnostics, Inc. “Our recent achievements underscore our commitment to delivering a Wave pre-clinical positive blood culture study by year-end. Moreover, we’re pleased with the ongoing progress of our BD partnership, resulting in the strongest quarter for US contracted instruments since 2021.” Second Quarter 2023 Operating Highlights: - Added 13 contracted instruments during the quarter. Ended the quarter with 339 U.S. clinically live and revenue-generating instruments, with another 70 U.S. contracted instruments in the process of being implemented and not yet revenue-generating.
- Continue to make significant progress with our Wave development program, now running 1,000 Wave cards a week with more than 100 million images taken to-date to support algorithm development.
- BD commercial partnership continues to progress with more opportunities advancing further in the sales funnel with notable increases in sales funnel velocity.
- Closed various Restructuring Transactions, to extend a portion of the current maturity, lower our overall debt outstanding and simplify our capital structure.
Second Quarter 2023 Financial Highlights: - Net sales were $2.9 million, compared to $3.9 million in the second quarter of the prior year. The decrease in revenues was driven by fewer capital instrument sales in the current quarter.
- Gross margin was 27% for the quarter, compared to 28% in the second quarter of the prior year.
- Selling, general, and administrative (SG&A) costs for the quarter were $7.6 million, compared to $11.5 million for the same quarter of the prior year. SG&A costs for the quarter excluding non-cash stock-based compensation were $6.3 million, compared to $8.3 million for the same quarter of the prior year. This decrease was driven by lower employee-related expenses.
- Research and development (R&D) costs for the quarter were $5.8 million, compared to $7.6 million for the same quarter of the prior year. R&D costs excluding non-cash stock-based compensation expense for the quarter were $5.6 million, compared to $7.0 million for the same quarter of the prior year. This decline in expense driven by reductions of third-party partnership spend as our Wave program continues to advance.
- GAAP net loss was $26.0 million dollars, resulting in a net loss per share of $2.36. Net Loss from Operations, excluding non-cash stock-based compensation expense was $10.9 million.
- Net cash used in the quarter excluding financing was $15.2 million with notable debt and equity issuance costs for professional and legal fees related to our Restructuring Transactions and the company ended the quarter with total cash, investments, and cash equivalents of $30.7 million.
Year-to-date Financial 2023 Highlights - Net sales were $5.7 million year-to-date, compared to $6.8 million for the same period of the prior year. The decrease in revenues was driven by fewer capital instrument sales in the current year.
- Gross margin was 32% year-to-date, compared to 28% for the same period of the prior year.
- Selling, general, and administrative (SG&A) costs year-to-date were $17.7 million, compared to $22.2 million for the same period of the prior year. SG&A costs excluding non-cash stock-based compensation were $16.5 million year to date, compared to $16.5 million for the same period of the prior year.
- Research and development (R&D) costs were $12.8 million year to date, compared to $13.6 million for the same period of the prior year. R&D costs excluding non-cash stock-based compensation expense were $11.9 million year to date, compared to $12.7 million for the same period of the prior year. This decline in expense driven by reductions of third-party partnership spend as our Wave program continues to advance.
- GAAP Net loss was $42.8 million year-to-date, resulting in a net loss per share of $4.11. Net Loss from Operations, excluding non-cash stock-based compensation expense was $26.4 million.
- Net cash used excluding financing was $28.9 million
The Company is finalizing its analysis of the accounting for the Restructuring Transactions. All share and per share amounts have been retroactively adjusted for all periods presented to reflect the reverse stock split effected on July 11th, 2023. Full financial results for the quarter ended June 30, 2023 will be filed on Form 10-Q through the Securities and Exchange Commission’s (SEC) website at http://www.sec.gov Audio Webcast and Conference Call Today at 4:30 p.m. Eastern Time To listen by phone, dial +1.877.883.0383 and enter the Elite Entry Number: 4614555. International participants may dial +1.412.902.6506. Please dial in 10-15 minutes prior to the start of the conference. A replay of the call will be available by telephone at +1.877.344.7529 (U.S.) or +1.412.317.0088 (International) using the replay code 8685802 until August 31, 2023. This conference call will also be webcast and can be accessed from the company’s website at ir.axdx.com. A replay of the audio webcast will be available until August 31, 2023. Non-GAAP Financial Measures This press release contains certain financial measures that are not recognized measures under accounting principles generally accepted in the United States of America (“GAAP”), which include SG&A, R&D, and operating income (loss) amounts excluding stock-based compensation expenses. Our management and board of directors use expenses excluding the cost of stock-based compensation (net of forfeitures) to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short-term and long-term operating and financing plans. Accordingly, we believe that expenses excluding the cost of stock-based compensation provides useful information for investors in understanding and evaluating our operating results in the same manner as our management and our board of directors. Expenses excluding the cost of stock-based compensation is a non-GAAP financial measure and should be considered in addition to, not as superior to, or as a substitute for, SG&A expenses, R&D expenses, and operating income (loss) reported in accordance with GAAP. The following tables present a reconciliation of SG&A expenses, R&D expenses and operating income (loss) excluding stock-based compensation to comparable GAAP measures for the periods indicated: | | Three Months Ended June 30, | Six Months Ended June 30, | | | (in thousands) | (in thousands) | | | 2023 | 2022 | 2023 | 2022 | | Sales, General and Administrative | $ 7,564 | $ 11,493 | $ 17,669 | $ 22,167 | | Non-cash equity-based compensation
as a component of sales, general and
administrative | 1,299 | 3,204 | 1,159 | 5,646 | | Sales, general and administrative less
non-cash equity-based compensation | $ 6,266 | $ 8,289 | $ 16,510 | $ 16,521 | | | | | Three Months Ended June 30, | Six Months Ended June 30, | | | (in thousands) | (in thousands) | | | 2023 | 2022 | 2023 | 2022 | | Research and Development | $ 5,820 | $ 7,576 | $ 12,788 | $ 13,600 | | Non-cash equity-based
compensation as a component of
research and development | 256 | 539 | 861 | 901 | | Research and development less non-
cash equity-based compensation | $ 5,563 | $ 7,037 | $ 11,927 | $ 12,699 | | | | | Three Months Ended June 30, | Six Months Ended June 30, | | | (in thousands) | (in thousands) | | | 2023 | 2022 | 2023 | 2022 | | Loss from operations | $ (12,585) | $ (17,989) | $ (28,647) | $ (33,884) | | Non-cash equity-based
compensation as a component of
loss from operations | 1,653 | 3,971 | 2,208 | 6,950 | | Loss from operations less non-cash
equity-based compensation | $ (10,932) | $ (14,018) | $ (26,439) | $ (26,934) | About Accelerate Diagnostics, Inc. Accelerate Diagnostics, Inc. is an in vitro diagnostics company dedicated to providing solutions for the global challenges of antibiotic resistance and sepsis. The Accelerate Pheno® system and Accelerate PhenoTest® BC kit combine several technologies aimed at reducing the time clinicians must wait to determine the most optimal antibiotic therapy for deadly infections. The FDA cleared system and kit fully automate the sample preparation steps to report phenotypic antibiotic susceptibility results in approximately 7 hours direct from positive blood cultures. Recent external studies indicate the solution offers results 1-2 days faster than existing methods, enabling clinicians to optimize antibiotic selection and dosage specific to the individual patient days earlier. “Accelerate Diagnostics” and diamond shaped logos and marks are registered trademarks of Accelerate Diagnostics, Inc. Any trade, product or service name referenced in this document using the name “Accelerate” is a trademark and/or property of Accelerate Diagnostics, Inc. All other company and product names may be trademarks, registered trademarks, or service marks of the companies with which they are associated. For more information about the company, its products and technology, or recent publications, visit axdx.com. Forward-Looking Statements Certain of the statements made in this press release are forward-looking or may have forward-looking implications. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. Information about the risks and uncertainties faced by Accelerate Diagnostics is contained in the section captioned “Risk Factors” in the company’s most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 31, 2023, and in any other reports that the company files with the Securities and Exchange Commission. The company’s forward-looking statements could be affected by general industry and market conditions. Except as required by federal securities laws, the company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies. | ACCELERATE DIAGNOSTICS, INC.
CONDENSED CONSOLIDATED
BALANCE SHEETS
(in thousands, except share data) | | | | | June 30, | December 31, | | | 2023 | 2022 | | | Unaudited | | | ASSETS | | Current assets: | | | | Cash and cash equivalents | $29,282 | $34,905 | | Investments | 1,423 | 10,656 | | Trade accounts receivable, net | 2,342 | 2,416 | | Inventory | 5,106 | 5,194 | | Prepaid expenses | 1,274 | 818 | | Other current assets | 2,812 | 2,025 | | Total current assets | 42,239 | 56,014 | | Property and equipment, net | 2,896 | 3,478 | | Finance lease assets, net | 2,091 | 2,422 | | Operating lease right of use assets, net | 1,527 | 1,859 | | Other non-current assets | 1,125 | 1,242 | | Total assets | $49,878 | $65,015 | | LIABILITIES AND STOCKHOLDERS’ DEFICIT | | Current liabilities: | | | | Accounts payable | $4,033 | $4,501 | | Accrued liabilities | 3,229 | 2,682 | | Accrued interest | 348 | 472 | | Deferred revenue | 478 | 547 | | Current portion of convertible notes | 726 | 56,413 | | Finance lease, current | 1,180 | 1,113 | | Operating lease, current | 936 | 829 | | Derivative liability | 42,786 | — | | Total current liabilities | 53,716 | 66,557 | | Finance lease, non-current | 375 | 782 | | Operating lease, non-current | 1,064 | 1,545 | | Other non-current liabilities | 1,097 | 874 | | Accrued interest related-party | — | 663 | | Long-term debt related-party | — | 16,858 | | Convertible notes | 32,289 | — | | Total liabilities | $88,541 | $87,279 | | Stockholders’ deficit: | | | | Preferred shares, $0.001 par value; | | | | 5,000,000 preferred shares authorized with no shares issued and outstanding on
June 30, 2023 and 5,000,000 preferred shares authorized with 395,455 shares issued
and outstanding on December 31, 2022 | — | — | | Common stock, $0.001 par value; | | | | 450,000,000 common shares authorized with 14,357,953 shares issued and
outstanding on June 30, 2023 and 200,000,000 common shares authorized with
9,747,755 shares issued and outstanding on December 31, 2022 | 14 | 10 | | Contributed capital | 657,057 | 630,432 | | Treasury stock | (45,067) | (45,067) | | Accumulated deficit | (650,014) | (607,239) | | Accumulated other comprehensive loss | (653) | (400) | | Total stockholders’ deficit | (38,663) | (22,264) | | Total liabilities and stockholders’ deficit | $49,878 | $65,015 | | | | See accompanying notes to condensed consolidated financial statements. | | ACCELERATE DIAGNOSTICS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Unaudited
(in thousands, except per share data) | | | | | Three Months Ended | | Six Months Ended | | | June 30, | June 30, | | June 30, | June 30, | | | 2023 | 2022 | | 2023 | 2022 | | Net sales | $2,921 | $3,861 | | $5,733 | $6,820 | | | | | | | | | Cost of sales | 2,122 | 2,781 | | 3,923 | 4,937 | | Gross profit | 799 | 1,080 | | 1,810 | 1,883 | | | | | | | | | Costs and expenses: | | | | | | | Research and development | 5,820 | 7,576 | | 12,788 | 13,600 | | Sales, general and administrative | 7,564 | 11,493 | | 17,669 | 22,167 | | Total costs and expenses | 13,384 | 19,069 | | 30,457 | 35,767 | | | | | | | | | Loss from operations | (12,585) | (17,989) | | (28,647) | (33,884) | | | | | | | | | Other (expense) income: | | | | | | | Interest expense | (1,175) | (713) | | (1,593) | (1,630) | | Interest expense related-party | (804) | — | | (1,817) | — | | (Loss) gain on extinguishment of debt | (6,550) | 199 | | (6,550) | 3,565 | | (Loss) on financial instruments | (5,030) | — | | (5,030) | — | | Foreign currency exchange gain | 25 | 31 | | 258 | 40 | | Interest income | 255 | 56 | | 675 | 78 | | Other income (expense), net | 40 | (107) | | 85 | (157) | | Total other (expense) income, net | (13,239) | (534) | | (13,972) | 1,896 | | | | | | | | | Net loss before income taxes | (25,824) | (18,523) | | (42,619) | (31,988) | | Provision for income taxes | (156) | — | | (156) | — | | Net loss | $(25,980) | $(18,523) | | $(42,775) | $(31,988) | | | | | | | | | Basic and diluted net loss per share | $(2.36) | $(2.43) | | $(4.11) | $(4.44) | | Weighted average shares outstanding | 11,009 | 7,623 | | 10,420 | 7,200 | | | | | | | | | Other comprehensive loss: | | | | | | | Net loss | $(25,980) | $(18,523) | | $(42,775) | $(31,988) | | Net unrealized gain (loss) on debt securities available-for-sale | 4 | (39) | | 28 | (132) | | Foreign currency translation adjustment | (26) | (161) | | (281) | (240) | | Comprehensive loss | $(26,002) | $(18,723) | | $(43,028) | $(32,360) | | | | See accompanying notes to condensed consolidated financial statements. | | ACCELERATE DIAGNOSTICS, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
Unaudited
(in thousands) | | | | | Six Months Ended | | | June 30, | June 30, | | | 2023 | 2022 | | Cash flows from operating activities: | | | | Net loss | $(42,775) | $(31,988) | | Adjustments to reconcile net loss to net cash used in operating activities: | | | | Depreciation and amortization | 1,617 | 1,435 | | Amortization of investment discount | — | 79 | | Equity-based compensation | 2,208 | 6,950 | | Amortization of debt discount and issuance costs | 692 | 284 | | Amortization of debt discount related-party | 1,033 | — | | Loss on disposal of property and equipment | 68 | 283 | | Unrealized (gain) loss on equity investments | (90) | 157 | | Loss (gain) on extinguishment of debt | 6,550 | (3,565) | | Loss on derivative | 5,030 | — | | (Increase) decrease in assets: | | | | Contributions to deferred compensation plan | — | (110) | | Accounts receivable | 74 | (615) | | Inventory | (30) | (416) | | Prepaid expense and other | (78) | (719) | | Increase (decrease) in liabilities: | | | | Accounts payable | (451) | 658 | | Accrued liabilities and other | 125 | 2,288 | | Accrued interest | 900 | (159) | | Accrued interest from related-party | 784 | — | | Deferred revenue and income | (69) | (116) | | Deferred compensation | 223 | (51) | | Net cash used in operating activities | (24,189) | (25,605) | | | | | | Cash flows from investing activities: | | | | Purchases of equipment | (167) | (447) | | Purchase of marketable securities | — | (27,504) | | Maturities of marketable securities | 9,291 | 18,738 | | Net cash provided (used) by investing activities | 9,124 | (9,213) | | | | | | Cash flows from financing activities: | | | | Common stock to related party | 4,000 | — | | Payments on finance leases | (540) | (424) | | Proceeds from exercise of options | — | 7 | | Proceeds from issuance of common stocks under employee purchase plan | — | 137 | | Proceeds from issuance of convertible notes | 10,000 | — | | Transaction costs related to debt and equity issuance | (3,731) | — | | Net cash (used) provided by financing activities | 9,729 | (280) | | | | | | | | | | Effect of exchange rate on cash | (287) | (219) | | | | | | Decrease in cash and cash equivalents | (5,623) | (35,317) | | Cash and cash equivalents, beginning of period | 34,905 | 39,898 | | Cash and cash equivalents, end of period | $29,282 | $4,581 | | | | | | Non-cash investing activities: | | | | Net transfer of instruments from inventory to property and equipment | $88 | $202 | | | | | | Non-cash financing activities: | | | | Extinguishment of 2.50% Convertible Senior Notes (the “2.5% Notes”) through
issuance of common stock | $— | $10,180 | | Capital contribution from the exchange of secured note and accrued interest through
the issuance of common stock with related party | $25,363 | $— | | Loss from the exchange of secured note and accrued interest through the issuance of
common stock with related party | $6,059 | $— | | Capital contribution from the issuance of put option with related party | $1,336 | $— | | Exchange of 2.5% Notes and accrued interest for 5.0% Convertible Senior Notes (the
“5.0% Notes”) | $56,893 | $— | | Debt premium on issuance of 5.0% Notes | $6,023 | $— | | Bifurcated derivative liability | $38,160 | $— | | | | | | Supplemental cash flow information: | | | | Interest paid | $— | $1,506 | | | | See accompanying notes to condensed consolidated financial statements. |  View original content to download multimedia:https://www.prnewswire.com/news-releases/accelerate-diagnostics-reports-second-quarter-2023-financial-results-301898229.html
SOURCE Accelerate Diagnostics, Inc. | |
