LabStyle Innovations Reports Q1 2016 Results

CAESAREA, Israel, May 11, 2016 /PRNewswire/ --

• Quarterly gross loss narrowed 61% compared to Q4 2015
• Net loss narrowed by 29% compared to Q4 2015
• Launched Dario Blood Glucose Monitoring System in the United States late in the first quarter
• Social media marketing campaign featured in Business Success Story case study on Facebook.com
• Completed $8.5 million capital raise and NASDAQ uplisting

LabStyle Innovations Corp. (NASDAQ: DRIO), developer of the Dario Diabetes Management Solution, today reported financial and operational results for the quarter ended March 31, 2016 and provided an outlook for the coming quarters. 

"We are very proud of our progress during the first quarter of 2016. Our continued growth in revenues, and the narrowing of our gross loss and net loss provide evidence of the continued adoption of the Dario, and represent an important endorsement of our user-centric approach to diabetes management from the market," said Erez Raphael, LabStyle's Chief Executive Officer. "In the first quarter, we reached a major milestone by successfully completing our public offering, increasing the Company's shareholder's equity and uplisting our stock to NASDAQ. The proceeds of this capital raise will enable us to ramp our sales and marketing initiatives in the U.S., as well as expand Dario's presence to additional strategic markets, while more effectively serving customers in our existing markets. Our mission is to bring positive change to people with diabetes around the world, while leading the growth and innovation in the digital and mHealth market. We believe we have the right product and the right strategy to succeed in these efforts and look forward to the opportunities ahead of us."

First Quarter 2016 Financial Highlights

• Sequential quarterly revenues from distribution partners and customers of products and software services increased 84% from $308,000 in Q4 2015 to $568,000 in Q1 2016.
• Initial online sales in the U.S.
• Gross loss narrowed by 61% in Q1 2016, compared to Q4 2015
• Net loss narrowed by 29% in Q1 2016, compared to Q4 2015
• Shareholders' equity increased to $7.6 million at the end of Q1 compared to a shareholders' deficiency of $1.6 million and the end of Q4 2015
• Completed $8.5 million capital raise and uplisted to NASDAQ

Summary of Financial Results

LabStyle's revenues for Q1 2016 totaled approximately $568,000, an 84% increase compared to approximately $308,000 in Q4 2015. This includes product sales to distributors in the United Kingdom, the Netherlands, New Zealand, Australia and Canada and initial sales in the U.S. to direct customers, as well as services provided with respect to LabStyle's patient management software platform.

GAAP gross loss decreased by approximately $157,000, or 61%, to approximately $102,000 in Q1 2016, compared to approximately $259,000 in Q4 2015.

GAAP net loss attributable to holders of common stock, as detailed in the table below, improved by approximately $483,000, or 29%, to approximately $1,189,000 in Q1 2016, compared to approximately $1,672,000 in Q4 2015.

Non-GAAP adjusted EBITDA loss in the first quarter of 2016, as detailed in the table below, improved by approximately $76,000, or 4.8%, to approximately $1,497,000 for the first quarter of 2016, compared to approximately $1,573,000 in Non-GAAP adjusted EBIDTA loss in the fourth quarter of 2015.

As of March 31, 2016 cash and cash equivalents totaled approximately $8,267,000, compared to approximately $2,671,000 at the end of 2015.

Note on Non-GAAP Measures

Readers should note that LabStyle has, in certain disclosures above and in the schedule below, supplemented its GAAP net loss with a Non-GAAP measure of adjusted EBITDA.  Management believes that this Non-GAAP financial measure provides useful supplemental information to management and investors regarding LabStyle's performance, facilitates a more meaningful comparison of results for the current period with previous operating results, and assists management in analyzing future trends, making strategic and business decisions and establishing internal budgets and forecasts. A reconciliation of Non-GAAP adjusted EBIDTA to GAAP net loss, the most directly comparable GAAP measure is provided in the schedule below.

There are limitations in using this Non-GAAP financial measure because it is not prepared in accordance with GAAP and may be different from Non-GAAP financial measures used by other companies. This Non-GAAP financial measure should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider Non-GAAP financial measures only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP and the reconciliations of the Non-GAAP financial measure provided in the schedule below:

About LabStyle Innovations

LabStyle Innovations Corp. (NASDAQ: DRIO) creates innovative mobile and digital tools that empower and engage users to lead healthier lives. LabStyle's "Real data. Real time. Real improvements" approach and strategy is positioning the company as a major player in the mHealth industry; an industry currently worth $10B and expected to reach $31B by 2020. LabStyle's flagship product, The Dario Smart Diabetes Management Solution, is a platform for diabetes management that combines an all-in-one blood glucose meter, native smart phone app (iOS & Android), website portal and a wide variety of treatment tools to support more proactive and better informed decisions by users living with diabetes, their doctors and healthcare systems.

Cautionary Note Regarding Forward-Looking Statements

This news release and the statements of representatives and partners of LabStyle Innovations Corp. (the "Company") related thereto contain or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "plan," "project," "potential," "seek," "may," "will," "expect," "believe," "anticipate," "intend," "could," "estimate" or "continue" are intended to identify forward-looking statements. For example, the Company is using forward-looking statements in this press release when the Company discusses the planned use of proceeds from its capital raise, the Company's future opportunities, and the expected size of the mHealth industry.  Readers are cautioned that certain important factors may affect the Company's actual results and could cause such results to differ materially from any forward-looking statements that may be made in this news release. Factors that may affect the Company's results include, but are not limited to, regulatory approvals, product demand, market acceptance, impact of competitive products and prices, product development, commercialization or technological difficulties, the success or failure of negotiations and trade, legal, social and economic risks, and the risks associated with the adequacy of existing cash resources.

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