-Announces Distribution Partnership in Japan-
-Significantly Increases Working Capital by Year
End-
-Reduces Cash Burn for FY2013 to Record Low of
$6.3 Million-
-Achieves Lowest Reported Full Year Operating
Loss of $8.8 Million-
-Reconfirms Commitment to Technology
Advancements-
-Hosts Conference Call Today at 4:30 p.m. Eastern
Time-
Stereotaxis, Inc. (Nasdaq:STXS) today reported financial results
for the fourth quarter and full year ended December 31, 2013.
Management Comments
"We are very encouraged by the health of Stereotaxis today –
leaner, financially stronger and poised to further revolutionize
the delivery of care in the electrophysiology (EP) catheter
laboratory," said William C. Mills, Stereotaxis Chief Executive
Officer. "Over the course of 2013, we effectively transformed our
balance sheet, raising $21.9 million in new, permanent capital and
eliminating short-term debt obligations, which reduced the
principal of our total debt by $17.1 million. At the same time, we
continued to demonstrate intelligent capital stewardship during the
year, reporting the lowest full year cash burn and operating loss
since our initial public offering in 2004."
Mr. Mills continued, "While we were challenged to achieve
targeted top line results in 2013, we believe we have significant
growth opportunities ahead. As we announced today, we have
completed an agreement with two strong, experienced Japanese
companies to begin immediate commercialization of our Niobe®
technology in Japan. Furthermore, enthusiasm around our Vdrive™
with V-Sono™ ICE catheter manipulator continues to build in the
U.S., the result of strategic, customer-centric capital selling and
clinical adoption efforts.
"A firmer financial footing enables us to redirect our energies
to meaningful technological innovations that not only will lead the
EP market in safety and operator efficiencies, but will deliver the
highest quality patient outcomes possible, which is our ultimate
goal. I am proud to lead an organization of enormously dedicated,
creative people and am confident in the inherent strengths of our
robotic platform to illuminate a path for the future of
interventional cardiac electrophysiology."
Fourth Quarter Financial Results
Revenue for the fourth quarter of 2013 totaled $9.1 million,
compared to $12.2 million in the prior year fourth quarter, a 25.7%
decline. System revenue was $2.7 million, compared to $5.6 million
in the 2012 fourth quarter. The Company recognized revenue of $2.3
million on three Niobe ES systems and one ES upgrade, $0.1 million
on one Vdrive system and $0.3 million in Odyssey® system sales in
the fourth quarter 2013. Recurring revenue was $6.3 million in the
quarter compared to $6.6 million in the prior year fourth quarter.
Procedures declined 11% from the same quarter last year but
improved 5% sequentially.
The Company generated new capital orders of $3.9 million, which
includes three Niobe ES orders, one ES upgrade, three Vdrive orders
and three Odyssey system orders, compared to $4.2 million in the
fourth quarter of 2012. Ending capital backlog for the 2013 fourth
quarter was $6.8 million.
Gross margin in the quarter was $6.2 million, or 68.7% of
revenue, versus $7.9 million, or 65.0% of revenue, in the fourth
quarter of 2012. Operating expenses in the fourth quarter were $8.7
million compared to $8.8 million in the prior year quarter.
Operating loss in the fourth quarter was $(2.4) million,
compared to $(0.9) million in the prior year quarter. Interest
expense improved to $0.9 million from $2.0 million in the fourth
quarter of 2012 with the extinguishment of the Company's
convertible debentures.
The net loss for the 2013 fourth quarter was $(4.0) million, or
$(0.23) per share, compared to a net loss of $(4.3) million, or
$(0.55) per share, reported in the fourth quarter of 2012.
Excluding mark-to-market warrant revaluation and amortization of
convertible debt discount, the fourth quarter 2013 adjusted net
loss would have been $(3.3) million, or $(0.19) per share, and the
fourth quarter 2012 adjusted net loss would have been $(2.3)
million, or $(0.29) per share. The weighted average diluted shares
outstanding for the fourth quarters of 2013 and 2012 totaled 17.2
million and 7.8 million, respectively.
Cash burn for the fourth quarter of 2013 was $1.4 million,
compared to $0.1 million for the fourth quarter of 2012.
Full Year Financial Results
Revenue for the full year ended December 31, 2013 was $38.0
million compared to $46.6 million for the full year 2012. System
revenue in 2013 was $12.7 million on nine Niobe ES system sales,
and recurring revenue was $25.3 million. This compares to $19.7
million and $26.9 million for system and recurring revenues,
respectively, during 2012. Utilization companywide declined 11%
compared to last year.
Gross margin in the full year 2013 was $27.0 million, or 71% of
revenue, compared with $31.8 million, or 68% of revenue, in 2012.
Operating expenses for 2013 were $35.9 million, a 15% reduction
compared to $42.4 million in 2012.
Operating loss was $(8.8) million, the lowest full year
operating loss reported since the Company's initial public offering
in 2004 and a 16.8% improvement from the prior year.
Interest expense in full year 2013 increased to $12.6 million,
compared to $6.9 million in the prior year, primarily related to a
one-time, non-cash expense in the third quarter as a result of the
extinguishment of the Company's convertible debt.
The 2013 full year results included $53.9 million of charges
reported as other expense and interest expense, related to a
non-cash, mark-to-market adjustment and amortization of convertible
debt discount as a result of transactions with convertible note
holders and other equity investors. Including these charges, the
net loss for the full year 2013 was $(68.8) million, or $(5.95) per
share, compared to a net loss of $(9.2) million, or $(1.33) per
share, reported for full year 2012. Excluding these charges, the
net loss for 2013 would have been $(14.9) million, or $(1.29) per
share. Excluding the mark-to-market warrant revaluation and
amortization of convertible debt discount related to $18.5 million
in financing in 2012, the net loss for 2012 would have been $(16.5)
million, or $(2.38) per share.
Cash burn for 2013 was $6.3 million, compared to $12.2 million
in the prior year, a 48% reduction and the lowest annual reported
cash burn since the Company went public.
Financial Position
At December 31, 2013, Stereotaxis had cash and cash equivalents
of $13.8 million, compared to $8.4 million at September 30, 2013.
During the fourth quarter, the Company received gross proceeds of
approximately $10.2 million as a result of a subscription rights
offering. At year-end, total debt was $18.5 million related to
HealthCare Royalty Partners debt. The Company significantly
strengthened its balance sheet during the year, improving its cash
position by $6 million and eliminating $17.1 million of the
principal on total debt since December 31, 2012.
Clinical Update
In January 2014, the Company announced it had completed the
clinical trial of its Vdrive™ with V-Loop™ Circular Catheter
Manipulator. Results of the 120-patient study, which was conducted
at three hospitals in the U.S. and two in Europe, will be included
in a 510(k) Premarket Notification the Company intends to submit to
the U.S. FDA in the first quarter of 2014.
Conference Call and Webcast
Stereotaxis will host a conference call and webcast today,
February 25, 2014, at 4:30 p.m. Eastern Time, to discuss fourth
quarter and full year results. The dial-in number for the
conference call is 1-877-941-1427 for domestic participants and
1-480-629-9664 for international participants. Participants
are asked to call the above numbers 5-10 minutes prior to the start
time. To access the live and replay webcast, please visit the
investor relations section of the Stereotaxis website at
www.stereotaxis.com.
About Stereotaxis
Stereotaxis is a healthcare technology and innovation leader in
the development of robotic cardiology instrument navigation systems
designed to enhance the treatment of arrhythmias and coronary
disease, as well as information management solutions for the
interventional lab. Over 100 issued patents support the Stereotaxis
platform, which helps physicians around the world provide
unsurpassed patient care with robotic precision and safety,
improved lab efficiency and productivity, and enhanced
collaboration of life-saving information. Stereotaxis' core Epoch™
Solution includes the Niobe® ES Remote Magnetic Navigation system,
the Odyssey® portfolio of lab optimization, networking and patient
information management systems and the Vdrive™ Robotic Mechanical
Navigation system and consumables.
The core components of Stereotaxis systems have received
regulatory clearance in the U.S., European Union, Canada, China and
elsewhere. The V-Sono™ ICE catheter manipulator has received U.S.
clearance, and the V-Loop™ circular catheter manipulator will soon
be submitted for review by the U.S. Food and Drug Administration.
For more information, please visit www.stereotaxis.com
This press release includes statements that may constitute
"forward-looking" statements, usually containing the words
"believe," "estimate," "project," "expect" or similar expressions.
Forward-looking statements inherently involve risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. Factors that would cause or
contribute to such differences include, but are not limited to, the
Company's ability to raise additional capital on a timely basis and
on terms that are acceptable, its ability to continue to manage
expenses and cash burn rate at sustainable levels, its ability to
continue to work with lenders to extend, repay or refinance
indebtedness on acceptable terms, continued acceptance of the
Company's products in the marketplace, the effect of global
economic conditions on the ability and willingness of customers to
purchase its systems and the timing of such purchases, the outcome
of various shareholder litigation filed against Stereotaxis,
competitive factors, changes resulting from the recently enacted
healthcare reform in the U.S., including changes in government
reimbursement procedures, dependence upon third-party vendors,
timing of regulatory approvals, and other risks discussed in the
Company's periodic and other filings with the Securities and
Exchange Commission. By making these forward-looking statements,
the Company undertakes no obligation to update these statements for
revisions or changes after the date of this release. There can be
no assurance that the Company will recognize revenue related to its
purchase orders and other commitments in any particular period or
at all because some of these purchase orders and other commitments
are subject to contingencies that are outside of the Company's
control. In addition, these orders and commitments may be revised,
modified, delayed or canceled, either by their express terms, as a
result of negotiations, or by overall project changes or
delays.
STEREOTAXIS,
INC. |
BALANCE
SHEETS |
(Unaudited) |
|
|
December 31,
2013 |
December 31,
2012 |
|
(Unaudited) |
|
Assets |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 13,775,130 |
$ 7,777,718 |
Accounts receivable, net of
allowance of $383,077 and $640,183 in 2013 and 2012,
respectively |
7,558,152 |
11,570,489 |
Inventories |
4,879,039 |
5,098,241 |
Prepaid expenses and other
current assets |
1,945,206 |
3,492,067 |
Total current assets |
28,157,527 |
27,938,515 |
Property and equipment, net |
1,184,589 |
2,141,923 |
Intangible assets, net |
1,679,486 |
1,979,320 |
Long-term receivables |
20,431 |
73,199 |
Other assets |
34,363 |
32,987 |
Total assets |
$ 31,076,396 |
$ 32,165,944 |
|
|
|
Liabilities and stockholders' equity
(deficit) |
|
|
Current liabilities: |
|
|
Current maturities of long-term
debt |
$ 49,733 |
$ 12,264,490 |
Accounts payable |
3,512,339 |
3,556,688 |
Accrued liabilities |
7,079,381 |
5,361,810 |
Deferred contract revenue |
7,519,754 |
9,502,939 |
Warrants |
5,644,626 |
2,968,348 |
Total current liabilities |
23,805,833 |
33,654,275 |
|
|
|
Long-term debt, less current maturities |
18,481,478 |
16,824,736 |
Long-term deferred contract revenue |
491,080 |
477,159 |
Other liabilities |
-- |
-- |
|
|
|
Stockholders' equity (deficit): |
|
|
Preferred stock, par value
$0.001; 10,000,000 shares authorized, none outstanding at 2013 and
2012 |
-- |
-- |
|
|
|
Common stock, par value $0.001;
300,000,000 shares authorized, 19,311,390 and 8,018,615 shares
issued at 2013 and 2012, respectively |
19,311 |
8,019 |
Additional paid-in capital |
441,888,155 |
366,053,627 |
Treasury stock, 4,015 shares at
2013 and 2012 |
(205,999) |
(205,999) |
Accumulated deficit |
(453,403,462) |
(384,645,873) |
Total stockholders' equity (deficit) |
(11,701,995) |
(18,790,226) |
Total liabilities and stockholders' equity
(deficit) |
$ 31,076,396 |
$ 32,165,944 |
|
STEREOTAXIS,
INC. |
STATEMENTS OF
OPERATIONS |
(Unaudited) |
|
|
|
|
|
|
Three Months Ended Dec
31, |
Twelve Months
Ended Dec 31, |
|
2013 |
2012 |
2013 |
2012 |
|
|
|
|
|
Revenue |
|
|
|
|
System |
$ 2,742,292 |
$ 5,590,346 |
$ 12,743,218 |
$ 19,672,983 |
Disposables, service and
accessories |
6,325,734 |
6,614,563 |
25,287,863 |
26,889,451 |
Total revenue |
9,068,026 |
12,204,909 |
38,031,081 |
46,562,434 |
|
|
|
|
|
Cost of revenue |
|
|
|
|
System |
1,738,947 |
2,957,383 |
6,870,954 |
9,905,528 |
Disposables, service and
accessories |
1,098,197 |
1,314,942 |
4,130,347 |
4,875,527 |
Total cost of revenue |
2,837,144 |
4,272,325 |
11,001,301 |
14,781,055 |
|
|
|
|
|
Gross margin |
6,230,882 |
7,932,584 |
27,029,780 |
31,781,379 |
|
|
|
|
|
Operating expenses: |
|
|
|
|
Research and development |
1,358,468 |
1,479,158 |
5,672,058 |
8,405,086 |
Sales and marketing |
3,918,565 |
4,289,088 |
17,132,093 |
20,607,999 |
General and administration |
3,377,987 |
3,044,739 |
13,066,103 |
13,394,556 |
Total operating expenses |
8,655,020 |
8,812,985 |
35,870,254 |
42,407,641 |
Operating loss |
(2,424,138) |
(880,401) |
(8,840,474) |
(10,626,262) |
|
|
|
|
|
Other income (expense) |
(689,038) |
(1,414,341) |
(47,349,378) |
8,265,507 |
Interest income |
1,827 |
2,008 |
5,800 |
7,361 |
Interest expense |
(850,859) |
(2,023,927) |
(12,573,537) |
(6,885,033) |
Net loss |
$ (3,962,208) |
$ (4,316,661) |
$ (68,757,589) |
$ (9,238,427) |
|
|
|
|
|
Net loss per common share: |
|
|
|
|
Basic |
$ (0.23) |
$ (0.55) |
$ (5.95) |
$ (1.33) |
Diluted |
$ (0.23) |
$ (0.55) |
$ (5.95) |
$ (1.33) |
|
|
|
|
|
Weighted average shares used in computing net
loss per common share: |
|
|
|
|
Basic |
17,235,096 |
7,819,563 |
11,554,566 |
6,944,928 |
Diluted |
17,235,096 |
7,819,563 |
11,554,566 |
6,944,928 |
CONTACT: Company Contact:
Marty Stammer
Chief Financial Officer
314-678-6155
Investor Contact:
Todd Kehrli / Jim Byers
MKR Group, Inc.
323-468-2300
stxs@mkr-group.com