electroCore, Inc. (Nasdaq: ECOR), a commercial-stage bioelectronic
medicine company and wellness company, today announced third
quarter 2023 financial results and provided an operational update.
Third
Quarter 2023 and Recent
Highlights
- Record revenue of $4.5 million, an increase of approximately
128% over third quarter 2022
- Raised net proceeds of approximately $7.5 million in a
registered direct public offering and concurrent private placement
to institutional and accredited investors, and a separate private
placement to officers and directors.
- Raising revenue guidance for full year 2023 to $ 15.0 million -
$15.5 million.
Third Quarter 2023 Financial
Results
For the quarter ended September 30,
2023, electroCore reported net sales of $4.5 million
compared to $2.0 million during the same period of 2022,
which represents an approximately 128% increase over the prior
year. The increase of $2.5 million is primarily due to
increasing prescription revenue for our gammaCore device in
the Department of Veteran Affairs and Department of Defense, an
increase in prescription revenue for our gammaCore device from
outside the United States, and continued revenue from the sales of
our Truvaga and TAC-STIM wellness products.
(in thousands) |
|
Three months ended September 30, |
|
|
% Change |
|
|
Nine months ended September 30, |
|
|
% Change |
Channel |
|
2023 |
|
2022 |
|
|
|
|
|
2023 |
|
2022 |
|
|
|
Rx gammaCore – Department of Veteran Affairs and Department of
Defense |
|
$ |
2,737 |
|
$ |
1,167 |
|
|
135 |
% |
|
|
$ |
6,523 |
|
$ |
3,597 |
|
|
81 |
% |
Rx gammaCore – U.S.
Commercial |
|
|
439 |
|
|
392 |
|
|
12 |
% |
|
|
|
1,310 |
|
|
1,133 |
|
|
16 |
% |
Outside the United States |
|
|
464 |
|
|
417 |
|
|
11 |
% |
|
|
|
1,298 |
|
|
1,189 |
|
|
9 |
% |
Truvaga |
|
|
267 |
|
|
— |
|
|
— |
|
|
|
|
704 |
|
|
— |
|
|
— |
|
TAC-STIM |
|
|
601 |
|
|
— |
|
|
— |
|
|
|
|
1,000 |
|
|
— |
|
|
— |
|
Other |
|
|
— |
|
|
— |
|
|
— |
|
|
|
|
4 |
|
|
113 |
|
|
-96 |
% |
|
|
$ |
4,508 |
|
$ |
1,976 |
|
|
128 |
% |
|
|
$ |
10,839 |
|
$ |
6,032 |
|
|
80 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit for the third quarter of 2023 was $3.8 million as
compared to $1.7 million for the third quarter of 2022. Gross
margin for the third quarter of 2023 was 85% as compared to 87% in
the third quarter of 2022.
Total operating expenses in the third quarter of 2023 were
approximately $8.0 million as compared to $7.3 million in the third
quarter of 2022.
Research and development expense in the third quarter of 2023
was $1.2 million as compared to $1.6 million in the third quarter
of 2022. This decrease in research and development expense was due
to a decrease in compensation associated with cost cutting measures
offset by investments in product development for the next
generation of the Company’s non-invasive nerve stimulators.
Selling, general and administrative expense in the third quarter
of 2023 was $6.7 million as compared to $5.7 million in the third
quarter of 2022. This increase was primarily due to greater
variable selling and marketing costs consistent with the increase
in net sales.
GAAP net loss in the third quarter of 2023 was $4.0 million
compared to the $5.5 million net loss in the third quarter of
2022.
Adjusted EBITDA net loss in the third quarter of 2023 was $3.0
million as compared to a net loss of $4.8 million in the third
quarter of 2022.
The Company defines adjusted EBITDA net loss as GAAP net loss,
adjusted to exclude non-operating gains/losses, depreciation and
amortization, stock-based compensation expense, severance and other
related charges, inventory reserve charges, severance and other
related charges, legal fees associated with stockholders’
litigation, and benefit from income taxes. A reconciliation of GAAP
net loss to non-GAAP adjusted EBITDA net loss has been provided in
the financial statement tables included in the press
release.
Cash, cash equivalents and restricted cash at September 30, 2023
totaled approximately $13.7 million, as compared to approximately
$18.0 million as of December 31, 2022. In July 2023, the Company
raised net proceeds of approximately $7.5 million through a
registered direct offering and concurrent private placements priced
“at the market” under Nasdaq rules.
Full Year 2023 Outlook
The Company is increasing its revenue guidance for the year
ending December 31, 2023 to be $15.0 million - $15.5 million, as
compared to its previous guidance of $14.0 million - $15.0
million.
Webcast and Conference Call
Information
electroCore’s management team will host a
conference call today, November 8, 2023, beginning at 4:30 PM
EST.
Investors interested in listening to the conference call, or
webcast may dial 877-407-8835 for domestic callers or
201-689-8779 for international callers, using Conference ID:
13739200, or by connecting to the Web:
electroCore Earnings Webcast. An archived webcast of the
event will be available on the “Investors” section of the company’s
website at: www.electrocore.com.
About electroCore, Inc.
electroCore, Inc. is a commercial stage
bioelectronic medicine and wellness company dedicated to improving
health through its non-invasive vagus nerve stimulation (“nVNS”)
technology platform. Our focus is the commercialization of medical
devices for the management and treatment of certain medical
conditions and consumer product offerings utilizing nVNS to promote
general wellbeing and human performance in the United States and
select overseas markets.
Forward-Looking Statements
This press release and other written and oral statements made by
representatives of electroCore may contain forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements include, but
are not limited to, statements about expectations for revenue for
2023 and beyond, electroCore’s business prospects and clinical and
product development plans; its pipeline or potential markets for
its technologies; the timing, outcome and impact of regulatory,
clinical and commercial developments; business prospects around its
Truvaga wellness and TAC-STIM human performance offerings and other
new products and markets, and other statements that are not
historical in nature, particularly those that utilize terminology
such as "anticipates," "will," "expects," "believes," "intends,"
and other words of similar meaning, derivations of such words and
the use of future dates. Actual results could differ from those
projected in any forward-looking statements due to numerous
factors. Such factors include, among others, the ability to raise
the additional funding needed to continue to pursue electroCore’s
business and product development plans, the inherent uncertainties
associated with developing new products or technologies, the
ability to commercialize gammaCore™, TAC-STIM™, and Truvaga™, the
potential impact and effects of COVID-19 on the business of
electroCore, electroCore’s results of operations and financial
performance, inflation and currency fluctuations, and any
expectations electroCore may have with respect thereto, competition
in the industry in which electroCore operates and overall economic
and market conditions. Any forward-looking statements are made as
of the date of this press release, and electroCore assumes no
obligation to update the forward-looking statements or to update
the reasons why actual results could differ from those projected in
the forward-looking statements, except as required by law.
Investors should consult all of the information set forth herein
and should also refer to the risk factor disclosure set forth in
the reports and other documents electroCore files with the SEC
available at www.sec.gov.
Contact:
ECOR Investor Relations(973)
302-9253investors@electrocore.com
|
electroCore, Inc.Condensed Consolidated
Statements of Operations(unaudited)(in thousands, except
per share data) |
|
|
|
Three months ended |
|
|
Nine months ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
Net sales |
|
$ |
4,508 |
|
|
$ |
1,976 |
|
|
$ |
10,839 |
|
|
$ |
6,032 |
|
Cost of goods sold |
|
|
661 |
|
|
|
258 |
|
|
|
1,704 |
|
|
|
976 |
|
Gross profit |
|
|
3,847 |
|
|
|
1,718 |
|
|
|
9,135 |
|
|
|
5,056 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Research and development |
|
|
1,249 |
|
|
|
1,617 |
|
|
|
4,213 |
|
|
|
3,892 |
|
Selling, general and administrative |
|
|
6,724 |
|
|
|
5,657 |
|
|
|
20,233 |
|
|
|
18,121 |
|
Total operating expenses |
|
|
7,973 |
|
|
|
7,274 |
|
|
|
24,446 |
|
|
|
22,013 |
|
Loss from operations |
|
|
(4,126 |
) |
|
|
(5,556 |
) |
|
|
(15,311 |
) |
|
|
(16,957 |
) |
Other (income) expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other income |
|
|
(94 |
) |
|
|
(103 |
) |
|
|
(298 |
) |
|
|
(145 |
) |
Other expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
5 |
|
Total other (income)
expense |
|
|
(94 |
) |
|
|
(103 |
) |
|
|
(298 |
) |
|
|
(140 |
) |
Loss before income taxes |
|
|
(4,032 |
) |
|
|
(5,453 |
) |
|
|
(15,013 |
) |
|
|
(16,817 |
) |
Benefit from income taxes |
|
|
— |
|
|
|
— |
|
|
|
211 |
|
|
|
445 |
|
Net loss |
|
$ |
(4,032 |
) |
|
$ |
(5,453 |
) |
|
$ |
(14,802 |
) |
|
$ |
(16,372 |
) |
Net loss per share of common
stock - Basic and Diluted |
|
$ |
(0.68 |
) |
|
$ |
(1.20 |
) |
|
$ |
(2.87 |
) |
|
$ |
(3.45 |
) |
Weighted average common shares
outstanding - Basic and Diluted |
|
|
5,945 |
|
|
|
4,544 |
|
|
|
5,149 |
|
|
|
4,746 |
|
|
electroCore, Inc. Condensed
Consolidated Balance Sheet Information(unaudited)(in
thousands) |
|
|
|
September 30, 2023 |
|
|
December 31, 2022 |
|
Cash and cash equivalents |
|
$ |
13,460 |
|
|
$ |
17,712 |
|
Restricted cash |
|
$ |
250 |
|
|
$ |
250 |
|
Total assets |
|
$ |
20,108 |
|
|
$ |
24,756 |
|
Current liabilities |
|
$ |
8,508 |
|
|
$ |
7,045 |
|
Total liabilities |
|
$ |
9,068 |
|
|
$ |
7,670 |
|
Total equity |
|
$ |
11,040 |
|
|
$ |
17,086 |
|
|
|
|
|
|
|
|
|
|
(Unaudited) Use of Non-GAAP Financial
Measure
The Company is presenting adjusted EBITDA net loss because it
believes this measure is a useful indicator of its operating
performance. electroCore management uses this non-GAAP measure
principally as a measure of the company’s core operating
performance and believes that this measure is useful to investors
because it is frequently used by the financial community,
investors, and other interested parties to evaluate companies in
the company’s industry. The Company also believes that this measure
is useful to its management and investors as a measure of
comparative operating performance from period to period.
Additionally, the company believes its use of non-GAAP adjusted
EBITDA net loss from operations facilitates management’s internal
comparisons to historical operating results by factoring out
potential differences caused by gains and charges not related to
its regular, ongoing business, including, without limitation,
non-cash charges and certain large and unpredictable charges such
as restructuring expenses.
The Company defines adjusted EBITDA net loss as GAAP net loss,
adjusted to exclude non-operating gains/losses, depreciation and
amortization, stock-based compensation expense, severance and other
related charges, inventory reserve charges, legal fees
associated with stockholders’ litigation, and benefit from income
taxes.
Following is a reconciliation of GAAP net loss to non-GAAP
adjusted EBITDA net loss (in thousands):
|
|
Three months ended |
|
|
Nine months ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
GAAP net loss |
$ |
(4,032 |
) |
|
$ |
(5,453 |
) |
|
$ |
(14,802 |
) |
|
$ |
(16,372 |
) |
Depreciation and
amortization |
|
291 |
|
|
|
153 |
|
|
|
735 |
|
|
|
400 |
|
Stock-based compensation |
|
543 |
|
|
|
566 |
|
|
|
1,298 |
|
|
|
2,095 |
|
Inventory reserve charge |
|
193 |
|
|
|
— |
|
|
|
258 |
|
|
|
— |
|
Severance and other related
charges |
|
113 |
|
|
|
— |
|
|
|
445 |
|
|
|
— |
|
Legal fees associated with
stockholders' litigation |
|
7 |
|
|
|
17 |
|
|
|
42 |
|
|
|
149 |
|
Interest and other (income) expense |
|
(94 |
) |
|
|
(103 |
) |
|
|
(298 |
) |
|
|
(140 |
) |
Benefit
from income taxes |
|
— |
|
|
|
— |
|
|
|
(211 |
) |
|
|
(445 |
) |
Adjusted EBITDA net
loss |
$ |
(2,979 |
) |
|
$ |
(4,820 |
) |
|
$ |
(12,533 |
) |
|
$ |
(14,313 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Company’s use of a non-GAAP measure has limitations as an
analytical tool, and you should not consider it in isolation or as
a substitute for analysis of its results as reported under GAAP.
Some of these limitations are: the non-GAAP measure does not
reflect interest or tax payments that may represent a reduction in
cash available; although depreciation and amortization are non-cash
charges, the assets being depreciated and amortized may have to be
replaced in the future, and the non-GAAP measure does not reflect
cash capital expenditure requirements for such replacements or for
new capital expenditure requirements; the non-GAAP measure does not
reflect the potentially dilutive impact of equity-based
compensation; and the non-GAAP measure does not reflect changes in,
or cash requirements for, working capital needs; other companies,
including companies in electroCore’s industry, may calculate
adjusted EBITDA net loss differently, which reduces its usefulness
as a comparative measure.
Because of these and other limitations, you should consider the
non-GAAP measure together with other GAAP-based financial
performance measures, including various cash flow metrics, net
loss, and other GAAP results. A reconciliation of GAAP net loss to
non-GAAP adjusted EBITDA net loss has been provided in the
preceding financial statements table of this press release.
electroCore (NASDAQ:ECOR)
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electroCore (NASDAQ:ECOR)
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