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.
|
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SOURCE Accelerate Diagnostics, Inc.