CHF Solutions, Inc. Announces 34 Percent Increase in Revenue for First Quarter 2020 Over Previous Year and Provides Company U...
May 12 2020 - 8:00AM
CHF Solutions, Inc. (Nasdaq: CHFS) announced today its results for
the first quarter ended March 31, 2020, which included the
following highlights:
- Revenue for the first quarter ended March 31, 2020, was $1.6
million, an increase of 34 percent compared to the same period of
the prior year. Revenue increased by 19% from Q4 of 2019.
- Received 510(k) clearance in the U.S. and CE Mark in the EU for
adult and pediatric patients who weigh 20 kg or more and for the
next generation Aquadex console, the Aquadex SmartFlow™.
- Announced that Aquadex therapy is helping COVID-19 patients by
managing fluid overload when dialysis equipment is in short
supply.
- Hosted two physician-led webinars on treatment of critically
ill, COVID-19 patients, which addressed the importance of fluid
management per the World Health Organization guidelines, and
real-life applications of simple ultrafiltration, such as Aquadex
therapy, in COVID-19 patients.
- Announced expansion of commercial presence in Europe with
distribution arrangement for Germany, Austria and Switzerland, and
regulatory clearance to sell in India.
- Ended the quarter with $5.7 million in cash and no debt.
Subsequent to quarter end, announced the closing of two registered
direct offerings for net proceeds of approximately $3.5 million,
and warrant exercises of approximately $1.0 million, for total pro
forma cash balance as of March 31, 2020 of $10.1 million.
“We are very pleased that we produce a product that is providing
a meaningful therapy for treating the COVID-19 patients,” said John
Erb, chairman and CEO of CHF Solutions. “We know we are very
fortunate to be less impacted than many small medical device
companies, and although the rest of the year is full of
uncertainty, we remain optimistic about the value we can bring to
our customers and our investors.”
The Company will host a conference call and webcast at 9:00 AM
ET today to discuss its financial results and provide an update on
the Company’s performance. To access the live webcast, please visit
http://ir.chf-solutions.com/events. Alternatively, you may access
the live conference call by dialing (877) 303-9826 (U.S.) or (224)
357-2194 (international) and using conference ID: 7875248. An audio
archive of the webcast will be available following the call at
http://ir.chf-solutions.com/events.
About CHF Solutions CHF Solutions, Inc.
(Nasdaq: CHFS) is a medical device company dedicated to improving
the lives of patients suffering from fluid overload with its novel
ultrafiltration therapy system. The company is focused on
developing, manufacturing and commercializing the Aquadex
SmartFlow™ system for ultrafiltration therapy. CHF Solutions is
headquartered in Minneapolis, Minn., with wholly-owned subsidiaries
in Australia and Ireland. The company has been listed on the Nasdaq
Capital Market since February 2012.
About the Aquadex SmartFlow System The
Aquadex SmartFlow system delivers clinically proven therapy using a
simple, flexible and smart method of removing excess fluid from
patients suffering from hypervolemia (fluid overload). The Aquadex
SmartFlow system is indicated for temporary (up to 8 hours) or
extended (longer than 8 hours in patients who require
hospitalization) use in adult and pediatric patients weighing 20 kg
or more whose fluid overload is unresponsive to medical management,
including diuretics. All treatments must be administered by a
health care provider, within an outpatient or inpatient clinical
setting, under physician prescription, both having received
training in extracorporeal therapies.
Forward-Looking StatementsCertain statements in
this release are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995, including
without limitation, statements regarding the new market
opportunities and anticipated growth in 2020 and beyond.
Forward-looking statements are predictions, projections and other
statements about future events that are based on current
expectations and assumptions and, as a result, are subject to risks
and uncertainties. Many factors could cause actual future
events to differ materially from the forward-looking statements in
this release, including, without limitation, those risk associated
with our ability to execute on our commercialization strategy, the
impact of the COVID-19 pandemic, the possibility that we may
be unable to raise sufficient funds necessary for our anticipated
operations, our post-market clinical data collection activities,
benefits of our products to patients, our expectations with respect
to product development and commercialization efforts, our ability
to increase market and physician acceptance of our products,
potentially competitive product offerings, intellectual property
protection, our ability to integrate acquired businesses, our
expectations regarding anticipated synergies with and benefits from
acquired businesses, and other risks and uncertainties described in
our filings with the SEC. Forward-looking statements
speak only as of the date when made. CHF Solutions does not
assume any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
FINANCIALS
CHF SOLUTIONS, INC. AND
SUBSIDIARIESCondensed Consolidated
Statements of Operations and Comprehensive
Loss(unaudited, in thousands, except per share
amounts)
|
|
Three months ended March 31, |
|
|
2020 |
|
2019 |
|
Net sales |
$ |
1,630 |
|
$ |
1,215 |
|
Costs and
Expenses: |
|
|
|
|
|
|
Cost of goods sold |
|
796 |
|
|
612 |
|
Selling, general and administrative |
|
4,537 |
|
|
4,018 |
|
Research and development |
|
864 |
|
|
1,310 |
|
Total costs and expenses |
|
6,197 |
|
|
5,940 |
|
Loss from operations |
|
(4,567 |
) |
|
(4,725 |
) |
Other income, net |
|
1 |
|
|
- |
|
Loss before income taxes |
|
(4,566 |
) |
|
(4,725 |
) |
Income tax expense |
|
(2 |
) |
|
(2 |
) |
Net loss |
$ |
(4,568 |
) |
$ |
(4,727 |
) |
|
|
|
|
|
|
|
Basic and diluted loss
per share |
$ |
(0.37 |
) |
$ |
(11.47 |
) |
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic and diluted |
|
16,439 |
|
|
805 |
|
|
|
|
|
|
|
|
Other comprehensive
income: |
|
|
|
|
|
|
Foreign currency translation adjustments |
$ |
(3 |
) |
$ |
(2 |
) |
Total comprehensive
loss |
$ |
(4,571 |
) |
$ |
(4,729 |
) |
|
|
|
|
|
|
|
CHF SOLUTIONS, INC. AND
SUBSIDIARIESCondensed Consolidated Balance
Sheets(in thousands, except share and per share
amounts)
|
|
March 31, 2020 |
|
|
December 31, 2019 |
|
ASSETS |
|
(unaudited) |
|
|
|
|
Current
assets |
|
|
|
|
|
|
Cash and cash equivalents |
$ |
5,669 |
|
$ |
1,279 |
|
Accounts receivable |
|
727 |
|
|
799 |
|
Inventory |
|
2,195 |
|
|
1,797 |
|
Other current assets |
|
141 |
|
|
161 |
|
Total current
assets |
|
8,732 |
|
|
4,036 |
|
Property, plant and equipment, net |
|
897 |
|
|
991 |
|
Operating lease right-of-use asset |
|
397 |
|
|
442 |
|
Other assets |
|
21 |
|
|
133 |
|
TOTAL
ASSETS |
$ |
10,047 |
|
$ |
5,602 |
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
Accounts payable |
$ |
787 |
|
$ |
1,488 |
|
Accrued compensation |
|
1,114 |
|
|
1,592 |
|
Current portion of operating lease liability |
|
191 |
|
|
186 |
|
Other current liabilities |
|
39 |
|
|
85 |
|
Total current
liabilities |
|
2,131 |
|
|
3,351 |
|
Operating lease liability |
|
212 |
|
|
261 |
|
Total
liabilities |
|
2,343 |
|
|
3,612 |
|
|
|
|
|
|
|
|
Commitments and
contingencies |
|
— |
|
|
— |
|
|
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
|
Series A junior participating
preferred stock as of March 31, 2020 and December 31, 2019, par
value $0.0001 per share; authorized 30,000 shares, none
outstanding |
|
— |
|
|
— |
|
Series F convertible preferred
stock as of March 31, 2020 and December 31, 2019, par value $0.0001
per share; authorized 435 and 535 shares, respectively, issued and
outstanding 435 and 535, respectively |
|
— |
|
|
— |
|
Series H convertible preferred
stock as of March 31, 2020 and December 31, 2019, par value $0.0001
per share; authorized 488,090 and 0 shares, respectively, issued
and outstanding 488,090 and 0, respectively |
|
|
|
|
|
|
Preferred stock as of March
31, 2020 and December 31, 2019, par value$0.0001 per share;
authorized 39,481,475 and 39,969,465 shares, none outstanding |
|
— |
|
|
— |
|
Common stock as of March 31,
2020 and December 31, 2019, par value$0.0001 per share; authorized
100,000,000 shares, issued and outstanding27,142,390 and 4,674,068,
respectively |
|
3 |
|
|
— |
|
Additional paid‑in
capital |
|
228,560 |
|
|
218,278 |
|
Accumulated other
comprehensive income: |
|
|
|
|
|
|
Foreign currency translation adjustment |
|
1,211 |
|
|
1,214 |
|
Accumulated deficit |
|
(222,070 |
) |
|
(217,502 |
) |
Total stockholders’
equity |
|
7,704 |
|
|
1,990 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
$ |
10,047 |
|
$ |
5,602 |
|
|
|
|
|
|
|
|
CHF SOLUTIONS, INC. AND
SUBSIDIARIESCondensed Consolidated Statements of
Cash Flows(unaudited, in thousands)
|
|
Three months endedMarch 31, |
|
|
2020 |
|
|
2019 |
|
Operating Activities: |
|
|
|
|
|
|
Net loss |
$ |
(4,568 |
) |
$ |
(4,727 |
) |
Adjustments to reconcile net loss
to cash flows used in operating activities: |
|
|
|
|
|
|
Depreciation and amortization |
|
65 |
|
|
59 |
|
Stock-based compensation expense, net |
|
380 |
|
|
362 |
|
Loss on disposal of property and equipment |
|
46 |
|
|
— |
|
Changes in operating assets and
liabilities: |
|
|
|
|
|
|
Accounts receivable |
|
72 |
|
|
164 |
|
Inventory |
|
(398 |
) |
|
(132 |
) |
Other current assets |
|
20 |
|
|
(147 |
) |
Other assets and liabilities |
|
67 |
|
|
112 |
|
Accounts payable and accrued expenses |
|
(1,179 |
) |
|
(598 |
) |
Net cash used in
operating activities |
|
(5,495 |
) |
|
(4,907 |
) |
|
|
|
|
|
|
|
Investing
Activities: |
|
|
|
|
|
|
Purchases of property and equipment |
|
(17 |
) |
|
(41 |
) |
Net cash used in
investing activities |
|
(17 |
) |
|
(41 |
) |
|
|
|
|
|
|
|
Financing
Activities: |
|
|
|
|
|
|
Proceeds from public stock offerings, net |
|
9,616 |
|
|
10,959 |
|
Proceeds from warrant exercises |
|
289 |
|
|
— |
|
Net cash provided by
financing activities |
|
9,905 |
|
|
10,959 |
|
|
|
|
|
|
|
|
Effect of exchange rate changes
on cash |
|
(3 |
) |
|
(2 |
) |
Net increase (decrease) in cash
and cash equivalents |
|
4,390 |
|
|
6,009 |
|
Cash and cash equivalents -
beginning of period |
|
1,279 |
|
|
5,480 |
|
Cash and cash equivalents
- end of period |
$ |
5,669 |
|
$ |
11,489 |
|
|
|
|
|
|
|
|
Supplemental cash flow
information |
|
|
|
|
|
|
Cash paid for income taxes |
$ |
— |
|
$ |
— |
|
|
|
|
|
|
|
|
CONTACTS:
INVESTORS:
Claudia Napal Drayton
Chief Financial Officer
CHF Solutions, Inc.
952-345-4205
ir@chf-solutions.com
MEDIA:
Jessica Stebing
Health+Commerce
260-336-6202
jstebing@healthandcommerce.com
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