Sientra, Inc. (NASDAQ: SIEN) (“Sientra” or the “Company”), a
medical aesthetics company uniquely focused on plastic surgeons,
today announced its financial results for the first quarter ended
March 31, 2021.
First Quarter 2021 Financial
Highlights
- Q1 2021 total net sales of $23.2 million, a 37% year-over-year
increase
- Breast Products net sales of $18.3 million, a 47%
year-over-year increase and the largest-ever quarterly Breast
Products sales in Company history
- miraDry net sales of $4.9 million, a 10% year-over-year
increase
- Cash of $80.4 million as of March 31, 2021, which included the
net proceeds from a public offering of common stock on February 11,
2021 of approximately $39.2 million
- Updated full year 2021 guidance for Breast Products net sales
expected to be between $72 to $76 million, representing 31%-38%
growth year over year
Recent Business Highlights
- Signed definitive agreement to sell miraDry business to 1315
Capital Partners
- Entered into a strategic partnership with Butterfly Network to
improve diagnostic surveillance of breast implant patients
- AlloX2® awarded an Innovative Technology contract from Vizient,
Inc., signifying the benefits of its transformative technology and
making the product now broadly available to all major hospitals in
the U.S. performing reconstruction surgery
Ron Menezes, Sientra’s President and Chief
Executive Officer, said, “Our first quarter was marked by
outstanding execution of our 2021 strategic priorities by the
Sientra team. Importantly, we saw our U.S. breast business
experience notable gains in market share and new accounts, while
accelerating our efforts to a be a top two implant and expander
company in two years. Sales in our reconstruction market saw
renewed traction as access to more hospitals opened and states
began easing pandemic restrictions. We anticipate further upside in
this market with AlloX2, our leading tissue expander, which will
now be broadly available to all major hospitals performing breast
reconstruction surgery. In addition, we were delighted to announce
the expected sale of our miraDry business to 1315 Capital Partners,
enabling us to concentrate on plastic surgery and on our rapidly
growing Breast Products business.”
First Quarter 2020 Financial
Review Total net sales for the first quarter 2021 were
$23.2 million, an increase of 37% compared to total net sales of
$16.9 million for the same period in 2020.
Net sales for the Breast Products segment totaled
$18.3 million in the first quarter 2021, a 47% increase compared to
$12.5 million for the same period in 2020.
Net sales for the miraDry segment totaled $4.9
million in the first quarter 2021, a 10% increase compared to $4.5
million for the same period in 2020.
Gross profit for the first quarter 2021 was $12.3
million, or 52.9% of sales, compared to gross profit of $10.1
million, or 59.9% of sales, for the same period in 2020. Gross
margins decreased mainly as a result of lower overhead absorption
in the miraDry segment.
Operating expenses for the first quarter 2021 were
$22.1 million, a decrease of 40% compared to $37.1 million of
operating expenses for the same period in 2020. Excluding a $6.4
million non-cash impairment of certain intangibles related to
miraDry and restructuring charges totaling $1.7 million in the
first quarter of 2020, operating expenses in the first quarter of
2021 decreased $6.9 million, or 24%, compared to the same period in
2020.
Net loss for the first quarter 2021 was $54.7
million, or $1.01 per share, compared to a net loss of $28.6
million, or $0.57 per share, for the same period in 2020. Net loss
was driven primarily by a $42.7 million non-cash charge from the
change in fair value of the derivative liability associated with
the Company’s convertible note. On a non-GAAP basis, net loss per
share for the first quarter of 2021 was $5.3 million, or $0.10 per
share, compared to $15.5 million, or $0.31 per share for the same
period in 2020.
Net cash and cash equivalents as of March 31, 2021
were $80.4 million, compared to $55.0 million as of December 31,
2020 and includes the net proceeds from the closing of the
Company’s public offering of common stock on February 11, 2021 of
approximately $39.2 million.
Updated Financial Guidance For
the full year 2021, the Company increased its guidance in Breast
Products from net sales to $72 million to $76 million, representing
growth of 31% to 38% over 2020. This compares to previous guidance
of $70 million to $74 million.
Conference Call Sientra will hold
a conference call today, May 11, 2021 at 4:30 pm ET to discuss
first quarter results. The dial-in numbers are 844-464-3933 for
domestic callers and 765-507-2612 for international callers. The
conference ID is 3594402. A live webcast of the conference call
will be available on the Investor Relations section of the
Company's website at www.sientra.com. The webcast will be archived
on the website following the completion of the call.
Use of Non-GAAP Financial
Measures Sientra has supplemented its US GAAP net
income (loss) with a non-GAAP measure of Adjusted EBITDA and
non-GAAP earnings per share. Management believes that these
non-GAAP financial measures provide useful supplemental information
to management and investors regarding the performance of the
Company, facilitates a more meaningful comparison of results for
current periods 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 EBITDA to GAAP net income
(loss) and non-GAAP loss per share, the most directly comparable
GAAP measures, 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 Sientra’s
financial statements prepared in accordance with GAAP and the
reconciliations of the non-GAAP financial measure provided in the
schedule below.
About Sientra Headquartered in
Santa Barbara, California, Sientra is a medical aesthetics company
uniquely focused on plastic surgeons. The Company mission is to
offer proprietary innovations and unparalleled partnerships that
radically advance how plastic surgeons think, work and care for
their patients. Sientra has developed a broad portfolio of products
with technologically differentiated characteristics, supported by
independent laboratory testing and strong clinical trial outcomes.
The Company’s Breast Products segment includes its Sientra round
and shaped breast implants, the first fifth generation breast
implants approved by the FDA for sale in the United States, its
ground-breaking Allox2® breast tissue expander with patented
dual-port and integral drain technology, and BIOCORNEUM®, the #1
performing, preferred and recommended scar gel of plastic
surgeons(*).
Sientra uses its investor relations website
to publish important information about the Company, including
information that may be deemed material to investors. Financial and
other information about Sientra is routinely posted and
is accessible on the Company’s investor relations website
at www.sientra.com.
(*) Data on file
Forward-Looking Statements This
press release contains “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
based on management’s current assumptions and expectations of
future events and trends, which affect or may affect the Company’s
business, strategy, operations or financial performance, and actual
results may differ materially from those expressed or implied in
such statements due to numerous risks and uncertainties.
Forward-looking statements are made only as of the date of this
release. The words ‘‘believe,’’ ‘‘may,’’ ‘‘might,’’ ‘‘could,’’
‘‘will,’’ ‘‘aim,’’ ‘‘estimate,’’ ‘‘continue, ‘‘anticipate,’’
‘‘intend,’’ ‘‘expect,’’ ‘‘plan,’’ ‘‘position,” or the negative of
those terms, and similar expressions that convey uncertainty of
future events or outcomes are intended to identify estimates,
projections and other forward-looking statements. Forward-looking
statements may include information concerning the impact of the
COVID-19 pandemic on the Company and its operations, the Company’s
possible or assumed future results of operations, including
descriptions of the Company’s revenues, profitability, outlook and
overall business strategy. Such statements are subject to risks and
uncertainties, including the scope and duration of the COVID-19
pandemic, the Company’s ability to recapture delayed procedures
resulting from the COVID-19 pandemic, the positive reaction from
plastic surgeons and their patients to Sientra’s Breast Products,
the ability to meet consumer demand, the acceptance and growth of
its miraDry segment, and the Company’s ability to manage its
operating expenses and cash balance. Additional factors that could
cause actual results to differ materially from those contemplated
in this press release can be found in the Risk Factors section of
Sientra’s public filings with the Securities and Exchange
Commission. All statements other than statements of historical fact
are forward-looking statements. The words ‘‘believe,’’ ‘‘may,’’
‘‘might,’’ ‘‘could,’’ ‘‘will,’’ ‘‘aim,’’ ‘‘estimate,’’ ‘‘continue,
‘‘anticipate,’’ ‘‘intend,’’ ‘‘expect,’’ ‘‘plan,’’ ‘‘position,” or
the negative of those terms, and similar expressions that convey
uncertainty of future events or outcomes are intended to identify
estimates, projections and other forward-looking statements. You
are cautioned not to place undue reliance on these forward-looking
statements, and such estimates, projections and other
forward-looking statements speak only as of the date they were
made, and, except to the extent required by law, the Company
undertakes no obligation to update or review any estimate,
projection or forward-looking statement. Actual results may differ
from those set forth in this press release due to the risks and
uncertainties inherent in the Company’s business.
Investor Relations Contact Leigh
Salvo ir@sientra.com
|
|
Sientra,
Inc. |
|
Consolidated
Statements of Operations |
|
(In
thousands, except per share and share amounts) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
March 31, |
|
|
|
2021 |
|
|
2020 |
|
Net
sales |
|
$ |
23,236 |
|
|
$ |
16,932 |
|
Cost of
goods sold |
|
|
10,935 |
|
|
|
6,792 |
|
Gross profit |
|
|
12,301 |
|
|
|
10,140 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Sales and marketing |
|
|
12,375 |
|
|
|
16,763 |
|
Research and development |
|
|
2,392 |
|
|
|
2,908 |
|
General and administrative |
|
|
7,354 |
|
|
|
9,304 |
|
Restructuring |
|
|
— |
|
|
|
1,739 |
|
Impairment |
|
|
— |
|
|
|
6,432 |
|
Total operating expenses |
|
|
22,121 |
|
|
|
37,146 |
|
Loss from operations |
|
|
(9,820 |
) |
|
|
(27,006 |
) |
Other income
(expense), net: |
|
|
|
|
|
|
|
|
Interest income |
|
|
2 |
|
|
|
180 |
|
Interest expense |
|
|
(2,004 |
) |
|
|
(1,623 |
) |
Change in fair value of derivative liability |
|
|
(42,740 |
) |
|
|
(130 |
) |
Other income (expense), net |
|
|
(128 |
) |
|
|
(33 |
) |
Total other income (expense), net |
|
|
(44,870 |
) |
|
|
(1,606 |
) |
Loss before income taxes |
|
|
(54,690 |
) |
|
|
(28,612 |
) |
Income
tax |
|
|
— |
|
|
|
— |
|
Net loss |
|
$ |
(54,690 |
) |
|
$ |
(28,612 |
) |
Basic and
diluted net loss per share attributable to common stockholders |
|
$ |
(1.01 |
) |
|
$ |
(0.57 |
) |
Weighted
average outstanding common shares used for net loss per share
attributable to common stockholders: |
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
54,321,146 |
|
|
|
49,916,412 |
|
|
|
Sientra,
Inc. |
|
Condensed
Consolidated Balance Sheets |
|
(In
thousands) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
March 31, |
|
|
December 31, |
|
|
|
2021 |
|
|
2020 |
|
Assets |
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
80,372 |
|
|
$ |
54,967 |
|
Accounts receivable, net |
|
|
25,438 |
|
|
|
23,503 |
|
Inventories, net |
|
|
50,556 |
|
|
|
48,648 |
|
Prepaid expenses and other current assets |
|
|
2,803 |
|
|
|
2,154 |
|
Total current assets |
|
|
159,169 |
|
|
|
129,272 |
|
Property and
equipment, net |
|
|
13,388 |
|
|
|
13,106 |
|
Goodwill |
|
|
9,202 |
|
|
|
9,202 |
|
Other
intangible assets, net |
|
|
9,081 |
|
|
|
9,387 |
|
Other
assets |
|
|
7,573 |
|
|
|
8,011 |
|
Total assets |
|
$ |
198,413 |
|
|
$ |
168,978 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
|
|
Current portion of long-term debt |
|
$ |
5,820 |
|
|
$ |
4,670 |
|
Accounts payable |
|
|
3,845 |
|
|
|
6,504 |
|
Accrued and other current liabilities |
|
|
26,935 |
|
|
|
32,389 |
|
Customer deposits |
|
|
21,956 |
|
|
|
17,905 |
|
Sales return liability |
|
|
11,020 |
|
|
|
9,192 |
|
Total current liabilities |
|
|
69,576 |
|
|
|
70,660 |
|
Long-term
debt, net of current portion |
|
|
60,540 |
|
|
|
60,500 |
|
Derivative
liability |
|
|
69,310 |
|
|
|
26,570 |
|
Deferred and
contingent consideration |
|
|
2,467 |
|
|
|
2,350 |
|
Warranty
reserve and other long-term liabilities |
|
|
9,461 |
|
|
|
9,455 |
|
Total liabilities |
|
|
211,354 |
|
|
|
169,535 |
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Total stockholders’ equity |
|
|
(12,941 |
) |
|
|
(557 |
) |
Total liabilities and stockholders’ equity |
|
$ |
198,413 |
|
|
$ |
168,978 |
|
|
|
Sientra,
Inc. |
|
Condensed
Consolidated Statements of Cash Flows |
|
(In
thousands) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
|
2021 |
|
|
2020 |
|
Cash flows
from operating activities: |
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(54,690 |
) |
|
$ |
(28,612 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
|
|
|
Impairment |
|
|
— |
|
|
|
6,432 |
|
Depreciation and amortization |
|
|
1,384 |
|
|
|
1,228 |
|
Provision for doubtful accounts |
|
|
(386 |
) |
|
|
357 |
|
Provision for warranties |
|
|
332 |
|
|
|
236 |
|
Provision for inventory |
|
|
26 |
|
|
|
1,081 |
|
Fair value adjustments to derivative liability |
|
|
42,740 |
|
|
|
130 |
|
Fair value adjustments of other liabilities held at fair value |
|
|
17 |
|
|
|
(39 |
) |
Amortization of debt discount and issuance costs |
|
|
848 |
|
|
|
290 |
|
Stock-based compensation expense |
|
|
3,163 |
|
|
|
2,133 |
|
Other non-cash adjustments |
|
|
213 |
|
|
|
107 |
|
Changes in assets and liabilities: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(1,544 |
) |
|
|
1,766 |
|
Inventories |
|
|
(1,933 |
) |
|
|
(3,720 |
) |
Prepaid expenses, other current assets and other assets |
|
|
(268 |
) |
|
|
(587 |
) |
Accounts payable, accrued, and other liabilities |
|
|
(8,443 |
) |
|
|
(9,867 |
) |
Customer deposits |
|
|
4,051 |
|
|
|
1,284 |
|
Sales return liability |
|
|
1,823 |
|
|
|
592 |
|
Net cash used in operating activities |
|
|
(12,667 |
) |
|
|
(27,189 |
) |
Cash flows
from investing activities: |
|
|
|
|
|
|
|
|
Purchase of property and equipment |
|
|
(1,321 |
) |
|
|
(1,206 |
) |
Net cash used in investing activities |
|
|
(1,321 |
) |
|
|
(1,206 |
) |
Cash flows
from financing activities: |
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock for employee stock-based
plans |
|
|
1,132 |
|
|
|
534 |
|
Net proceeds from issuance of common stock |
|
|
39,226 |
|
|
|
264 |
|
Tax payments related to shares withheld for vested restricted stock units (RSUs) |
|
|
(1,215 |
) |
|
|
(1,201 |
) |
Gross borrowings under the Term Loan |
|
|
1,000 |
|
|
|
— |
|
Repayment of the Revolving Loan |
|
|
— |
|
|
|
(6,508 |
) |
Net proceeds from issuance of the Convertible Note |
|
|
— |
|
|
|
60,000 |
|
Deferred financing costs |
|
|
(750 |
) |
|
|
(240 |
) |
Net cash provided by financing activities |
|
|
39,393 |
|
|
|
52,849 |
|
Net increase (decrease) in cash, cash equivalents and restricted
cash |
|
|
25,405 |
|
|
|
24,454 |
|
Cash, cash
equivalents and restricted cash at: |
|
|
|
|
|
|
|
|
Beginning of period |
|
|
55,310 |
|
|
|
87,951 |
|
End of period |
|
$ |
80,715 |
|
|
$ |
112,405 |
|
|
|
|
|
|
|
|
|
|
Reconciliation of cash, cash equivalents, and restricted cash to
the consolidated balance sheets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
80,372 |
|
|
$ |
112,062 |
|
Restricted cash included in other assets |
|
|
343 |
|
|
|
343 |
|
Total cash, cash equivalents and restricted cash |
|
$ |
80,715 |
|
|
$ |
112,405 |
|
|
|
Sientra,
Inc. |
|
Reconciliation of Net Loss to Non-GAAP Adjusted
EBITDA |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
March 31, |
|
Dollars, in thousands |
|
2021 |
|
|
2020 |
|
Net loss, as
reported |
|
$ |
(54,690 |
) |
|
$ |
(28,612 |
) |
Adjustments
to net loss: |
|
|
|
|
|
|
|
|
Interest (income) expense and other, net |
|
|
2,130 |
|
|
|
1,476 |
|
Depreciation and amortization |
|
|
1,384 |
|
|
|
1,228 |
|
Fair value adjustments to contingent consideration |
|
|
17 |
|
|
|
— |
|
Fair value adjustments to derivative liability |
|
|
42,740 |
|
|
|
130 |
|
Stock-based compensation |
|
|
3,163 |
|
|
|
2,133 |
|
Restructuring |
|
|
— |
|
|
|
1,739 |
|
Impairment |
|
|
— |
|
|
|
6,432 |
|
Total adjustments to net loss |
|
|
49,434 |
|
|
|
13,138 |
|
Adjusted
EBITDA |
|
$ |
(5,256 |
) |
|
$ |
(15,474 |
) |
Basic and
diluted adjusted EBITDA per share |
|
$ |
(0.10 |
) |
|
$ |
(0.31 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended |
|
|
|
March 31, |
|
As a
Percentage of Revenue** |
|
2021 |
|
|
2020 |
|
Net loss, as
reported |
|
|
(235.4 |
%) |
|
|
(169.0 |
%) |
Adjustments
to net loss: |
|
|
|
|
|
|
|
|
Interest (income) expense and other, net |
|
|
9.2 |
% |
|
|
8.7 |
% |
Depreciation and amortization |
|
|
6.0 |
% |
|
|
7.3 |
% |
Fair value adjustments to contingent consideration |
|
|
0.1 |
% |
|
|
0.0 |
% |
Fair value adjustments to derivative liability |
|
|
183.9 |
% |
|
|
0.8 |
% |
Stock-based compensation |
|
|
13.6 |
% |
|
|
12.6 |
% |
Restructuring |
|
|
0.0 |
% |
|
|
10.3 |
% |
Impairment |
|
|
0.0 |
% |
|
|
38.0 |
% |
Total adjustments to net loss |
|
|
212.7 |
% |
|
|
77.6 |
% |
Adjusted
EBITDA |
|
|
(22.6 |
%) |
|
|
(91.4 |
%) |
|
|
|
|
|
|
|
|
|
** Adjustments may not add to the total figure due to rounding |
|
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