Cytori Therapeutics (NASDAQ: CYTX) (“Cytori” or the “Company”) today announced its third quarter financial results and provided updates on its corporate activity and clinical development.
Third quarter 2016 net loss allocable to common stockholders was $5.4 million and $0.26 per share. Operating cash burn was approximately $4.6 million in the third quarter 2016. Cytori ended the third quarter of 2016 with approximately $15 million of cash and cash equivalents.
Selected Recent Highlights:
- BARDA, a division of the U.S. Department of Health & Human Services, increased its contract funding to Cytori
- Completed enrollment in its US STAR phase III trial for scleroderma hand dysfunction
- Reported 48-week follow up data from US pilot/phase II ACT-OA trial
- Additional limited regulatory approvals received by Cytori customers in Japan for use at their clinics of Cytori® Cell Therapy™ for osteoarthritis of the knee
Q3 and Year-to-date 2016 Financial Performance
- Q3 2016 and year-to-date operating cash burn was $4.6 million and $15.4 million, compared to $6.2 million and $15.9 million for the same periods in 2015, respectively
- Q3 2016 and year-to-date total revenues were $2.6 million and $8.4 million, compared to $2.5 million and $8.3 million for the same periods in 2015, respectively
- Cash and debt principal balances at September 30, 2016 were approximately $15 million and $17.7 million, respectively
- Q3 2016 net loss allocable to common stockholders was $5.4 million or $0.26 per share, compared to a net income of $1.5 million or $0.15 per share (or a net loss of $5.8 million and $0.56 per share when excluding a non-cash credit charge of $7.3 million related to the change in fair value of warrant liabilities) for the same period in 2015
- Year-to-date net loss allocable to common stockholders was $17.1 million or $1.06 per share, compared to $16.6 million or $1.87 per share (or a net loss of $21 million or $2.36 per share, which excludes a non-cash charge of $5.0 million related to the change in fair value of warrant liabilities and a beneficial conversion feature charge for convertible preferred stock of $0.7 million) for the same period in 2015
“In Q3, we continued our focus on operational efficiency and maintaining momentum in our clinical development programs, we reduced our quarterly net losses by 7% and our operating cash burn by 25% from Q3’15 to Q3’16, respectively,” said Tiago Girao, VP of Finance and CFO of Cytori Therapeutics. “Our forecasts indicate that cash on hand coupled with efficient management of expenses, projected revenue growth, and modest influx of capital from a combination of business development activities and potential use of our ATM facility, will fund operations through mid 2017 and to important future milestones.”
Anticipated Forthcoming Milestones:
- IDE approval for thermal burn trial related to our contract with BARDA
- Report of 48-week US pivotal/phase III trial data for scleroderma hand dysfunction
- Complete enrollment on Japanese phase III for urinary incontinence
- Expansion of the Japanese osteoarthritis treatment centers
Updated 2016 Financial Guidance
The Company expects full year 2016 combined product and contract revenues to be lower than prior expectations based on the Company’s third quarter 2016 revenue results and the Company’s revised forecasts for the Managed Access Program fourth quarter 2016 product revenue.
- Combined product and contract revenues anticipated to be within a range of $11 million to $13 million
- Operating cash burn anticipated to be within a range of $19 million to $20 million
Management Conference Call Webcast
Cytori will host a management conference call at 5:30 p.m. Eastern Time today to further discuss the Company's progress. The webcast will be available live and by replay two hours after the call and may be accessed under "Webcasts" in the Investor Relations section of Cytori's website. If you are unable to access the webcast, you may dial in to the call at +1.877.402.3914, Conference ID: 9218454.
About Cytori
Cytori Therapeutics is a late stage cell therapy company developing autologous cell therapies from adipose tissue to treat a variety of medical conditions. Data from preclinical studies and clinical trials suggest that Cytori Cell Therapy™ acts principally by improving blood flow, modulating the immune system, and facilitating wound repair. As a result, Cytori Cell Therapy™ may provide benefits across multiple disease states and can be made available to the physician and patient at the point-of-care through Cytori’s proprietary technologies and products. For more information: visit www.cytori.com.
Cautionary Statement Regarding Forward-Looking Statements
This press release includes forward-looking statements that involve known and unknown risks and uncertainties. All statements, other than historical facts are forward looking statements. Such statements, including, without limitation, statements regarding having forecasted cash on hand sufficient to fund operations through 2017 (based upon expected expense containment, revenue growth and modest ATM usage), anticipated FDA approval of Cytori’s IDE submission for a thermal burn trial, anticipated receipt and disclosure of 48-week STAR data, completion of enrollment of the Cytori-supported, investigator-initiated Phase III ADRESU trial (male stress urinary incontinence), expected expansion in the number of clinic in Japan that apply for and receive regulatory approval to use Cytori Cell Therapy for knee osteoarthritis, and reiterated financial guidance (projected operating cash burn and total revenues for FY 2016) are subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks include clinical, pre-clinical and regulatory uncertainties, such as those associated with conduct and completion of the Company-sponsored ACT-OA and STAR trials and proposed BARDA would trial, as well as the Company-supported, investigator-initiated SCLERADEC-II and ADRESU trials. Specifically, the Company faces risks relating to failure to achieve full enrollment of SCLERADEC II and ADRESU trials, risks in the collection and results of ACT-OA, STAR, SCLERADEC II, ADRESU and other clinical data and related final clinical outcomes (including the risk that clinical data from one or more of these clinical trials will fail to demonstrate safety or efficacy of the Cytori Cell Therapy, and risks that insufficiently positive clinical data will adversely affect the regulatory approval pathways and commercial prospects for ECCS-50, CCO-50, DCCT-10 and the Company’s other potential products. Some of these risks also include risks relating to regulatory challenges the Company faces (including the U.S., EU, China, Japan and its other key geographies) due to a number of factors including novelty of the Company’s technology and product offerings, changes in and /or evolution of regulatory approaches to cellular therapeutics like the Company’s in its key geographies, and similar matters. The Company also face risks relating to achievement of the Company’s financial goals (including 2016 operating cash burn and 2016 total revenues), dependence on third party performance and approvals (including performance of investigator-initiated trials, and outcome of FDA review of the Company’s proposed burn wound trial pursuant to its contract with BARDA), performance and acceptance of the Company’s products in clinical studies/trials and in the marketplace (including the Company’s ability to successfully implement and conduct its EU managed access program, commercial acceptance of the Company’s products in Japan and other markets where are products are commercially available, and similar risks), material changes in the marketplace that could adversely impact revenue projections (including changes in market perceptions of the Company’s products, and introduction of competitive products), unexpected costs and expenses that could adversely impact liquidity and shorten the Company’s current liquidity projections (which could in turn require the Company to seek additional debt or equity capital sooner than currently anticipated), the Company’s reliance on key personnel, the Company’s ability to identify and develop new programs or assets to expand the Company’s clinical pipeline, the right of the U.S. government (BARDA) to cut or terminate further support of the thermal burn injury program (including any decision by BARDA not to proceed with a wound trial in 2016, assuming FDA approval of the Company’s IDE submission), the Company’s abilities to capitalize on its internal restructuring and achieve break-even or profitability (or to continue to reduce our operating losses), and other risks and uncertainties described under the "Risk Factors" in Cytori's Securities and Exchange Commission Filings, included in the Company’s annual and quarterly reports.
There may be events in the future that the Company is unable to predict, or over which it has no control, and its business, financial condition, results of operations and prospects may change in the future. The Company assumes no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made unless the Company has an obligation under U.S. Federal securities laws to do so.
| CYTORI THERAPEUTICS, INC. | ||||||||||
| CONSOLIDATED CONDENSED BALANCE SHEETS | ||||||||||
| (UNAUDITED) | ||||||||||
As of September 30, | As of December 31, | |||||||||
| Assets | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | $ | 14,924,000 | $ | 14,338,000 | ||||||
|
Accounts receivable, net of reserves of $173,000 and $797,000 in
2016 and 2015,
Respectively | 918,000 | 1,052,000 | ||||||||
| Inventories, net | 3,946,000 | 4,298,000 | ||||||||
| Other current assets | 1,253,000 | 1,555,000 | ||||||||
| Total current assets | 21,041,000 | 21,243,000 | ||||||||
| Property and equipment, net | 1,292,000 | 1,631,000 | ||||||||
| Restricted cash and cash equivalents | 350,000 | 350,000 | ||||||||
| Other assets | 1,474,000 | 1,521,000 | ||||||||
| Intangibles, net | 8,763,000 | 9,031,000 | ||||||||
| Goodwill | 3,922,000 | 3,922,000 | ||||||||
| Total assets | $ | 36,842,000 | $ | 37,698,000 | ||||||
| Liabilities and Stockholders’ Equity | ||||||||||
| Current liabilities: | ||||||||||
| Accounts payable and accrued expenses | $ | 5,637,000 | $ | 6,687,000 | ||||||
| Current portion of long-term obligations, net of discount | 5,267,000 | — | ||||||||
| Joint venture purchase obligation | — | 1,750,000 | ||||||||
| Total current liabilities | 10,904,000 | 8,437,000 | ||||||||
| Deferred revenues | 97,000 | 105,000 | ||||||||
| Long-term deferred rent and other | 41,000 | 269,000 | ||||||||
| Long-term obligations, net of discount, less current portion | 12,130,000 | 16,681,000 | ||||||||
| Total liabilities | 23,172,000 | 25,492,000 | ||||||||
| Commitments and contingencies | ||||||||||
| Stockholders’ equity: | ||||||||||
|
Series A 3.6% convertible preferred stock, $0.001 par value;
5,000,000 shares
authorized; 13,500 shares issued; no shares outstanding in 2016 and 2015 | — | — | ||||||||
|
Common stock, $0.001 par value; 75,000,000 shares authorized;
20,495,069 and
13,003,893 shares issued and outstanding in 2016 and 2015, respectively | 20,000 | 13,000 | ||||||||
| Additional paid-in capital | 387,119,000 | 368,214,000 | ||||||||
| Accumulated other comprehensive income | 675,000 | 996,000 | ||||||||
| Accumulated deficit | (374,144,000 | ) | (357,017,000 | ) | ||||||
| Total stockholders’ equity | 13,670,000 | 12,206,000 | ||||||||
| Total liabilities and stockholders’ equity | $ | 36,842,000 | $ | 37,698,000 | ||||||
| CYTORI THERAPEUTICS, INC. | ||||||||||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME | ||||||||||||||||
| (UNAUDITED) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
| 2016 | 2015 | 2016 | 2015 | |||||||||||||
| Product revenues | $ | 731,000 | $ | 766,000 | $ | 3,190,000 | $ | 3,281,000 | ||||||||
| Cost of product revenues | 618,000 | 502,000 | 1,770,000 | 2,395,000 | ||||||||||||
| Gross profit | 113,000 | 264,000 | 1,420,000 | 886,000 | ||||||||||||
| Development revenues: | ||||||||||||||||
| Government contracts and other | 1,879,000 | 1,711,000 | 5,163,000 | 5,002,000 | ||||||||||||
| 1,879,000 | 1,711,000 | 5,163,000 | 5,002,000 | |||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 3,960,000 | 4,352,000 | 13,334,000 | 14,363,000 | ||||||||||||
| Sales and marketing | 818,000 | 566,000 | 2,742,000 | 2,059,000 | ||||||||||||
| General and administrative | 2,011,000 | 2,370,000 | 6,625,000 | 7,662,000 | ||||||||||||
| Change in fair value of warrant liabilities | — | (7,310,000 | ) | — | (4,988,000 | ) | ||||||||||
| Total operating expenses | 6,789,000 | (22,000 | ) | 22,701,000 | 19,096,000 | |||||||||||
| Operating (loss) income | (4,797,000 | ) | 1,997,000 | (16,118,000 | ) | (13,208,000 | ) | |||||||||
| Other income (expense): | ||||||||||||||||
| Income (loss) on asset disposal | — | (3,000 | ) | 2,000 | 6,000 | |||||||||||
| Loss on debt extinguishment | — | — | — | (260,000 | ) | |||||||||||
| Interest income | 4,000 | 3,000 | 8,000 | 6,000 | ||||||||||||
| Interest expense | (645,000 | ) | (669,000 | ) | (1,947,000 | ) | (2,677,000 | ) | ||||||||
| Other income, net | 54,000 | 199,000 | 928,000 | 152,000 | ||||||||||||
| Total other expense | (587,000 | ) | (470,000 | ) | (1,009,000 | ) | (2,773,000 | ) | ||||||||
| Net (loss) income | $ | (5,384,000 | ) | $ | 1,527,000 | $ | (17,127,000 | ) | $ | (15,981,000 | ) | |||||
| Beneficial conversion feature for convertible preferred stock | — | — | — | (661,000 | ) | |||||||||||
| Net (loss) income allocable to common stockholders | $ | (5,384,000 | ) | $ | 1,527,000 | $ | (17,127,000 | ) | $ | (16,642,000 | ) | |||||
| Net income (loss) per share allocable to common stockholders | ||||||||||||||||
| Basic | $ | (0.26 | ) | $ | 0.15 | $ | (1.06 | ) | $ | (1.87 | ) | |||||
| Diluted | $ | (0.26 | ) | $ | 0.15 | $ | (1.06 | ) | $ | (1.87 | ) | |||||
|
Weighted average shares used in calculating net income (loss) per
share allocable to common stockholders | ||||||||||||||||
| Basic | 20,493,840 | 10,253,231 | 16,147,042 | 8,878,276 | ||||||||||||
| Diluted | 20,493,840 | 10,531,264 | 16,147,042 | 8,878,276 | ||||||||||||
| Comprehensive (loss) income: | ||||||||||||||||
| Net (loss) income | $ | (5,384,000 | ) | $ | 1,527,000 | $ | (17,127,000 | ) | $ | (15,981,000 | ) | |||||
|
Other comprehensive (loss) income – foreign currency translation
adjustments | 58,000 | 110,000 | (321,000 | ) | 361,000 | |||||||||||
| Comprehensive (loss) income | $ | (5,326,000 | ) | $ | 1,637,000 | $ | (17,448,000 | ) | $ | (15,620,000 | ) | |||||
| CYTORI THERAPEUTICS, INC. | ||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS | ||||||||
| (UNAUDITED) | ||||||||
| For the Nine Months Ended September 30, | ||||||||
| 2016 | 2015 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (17,127,000 | ) | $ | (15,981,000 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization | 794,000 | 761,000 | ||||||
| Amortization of deferred financing costs and debt discount | 714,000 | 714,000 | ||||||
| Joint Venture acquisition obligation accretion | 24,000 | 340,000 | ||||||
| Provision for expired inventory | 26,000 | — | ||||||
| Change in fair value of warrants | — | (4,988,000 | ) | |||||
| Stock-based compensation expense | 925,000 | 1,617,000 | ||||||
| Loss on asset disposal | 2,000 | 5,000 | ||||||
| Loss on debt extinguishment | — | 260,000 | ||||||
| Increases (decreases) in cash caused by changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 91,000 | 131,000 | ||||||
| Inventories | 190,000 | (10,000 | ) | |||||
| Other current assets | 205,000 | (258,000 | ) | |||||
| Other assets | 32,000 | 762,000 | ||||||
| Accounts payable and accrued expenses | (1,013,000 | ) | 870,000 | |||||
| Deferred revenues | (8,000 | ) | 41,000 | |||||
| Long-term deferred rent | (227,000 | ) | (210,000 | ) | ||||
| Net cash used in operating activities | (15,372,000 | ) | (15,946,000 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (110,000 | ) | (544,000 | ) | ||||
| Expenditures for intellectual property | — | (13,000 | ) | |||||
| Net cash used in investing activities | (110,000 | ) | (557,000 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Principal payments on long-term obligations | — | (25,032,000 | ) | |||||
| Proceeds from long-term obligations | — | 17,700,000 | ||||||
| Debt issuance costs and loan fees | — | (1,854,000 | ) | |||||
| Joint Venture purchase payments | (1,774,000 | ) | (1,623,000 | ) | ||||
| Proceeds from exercise of employee stock options and warrants | — | 4,986,000 | ||||||
| Proceeds from sale of common stock, net | 17,702,000 | 26,749,000 | ||||||
| Dividends paid on preferred stock | — | (75,000 | ) | |||||
| Net cash provided by financing activities | 15,928,000 | 20,851,000 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | 140,000 | — | ||||||
| Net increase in cash and cash equivalents | 586,000 | 4,348,000 | ||||||
| Cash and cash equivalents at beginning of period | 14,338,000 | 14,622,000 | ||||||
| Cash and cash equivalents at end of period | $ | 14,924,000 | $ | 18,970,000 | ||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20161109006259/en/
Contacts:
Tiago Girao
+1.858.458.0900
ir@cytori.com
