Endo-bariatric Product Sales Increase 29% in the Fourth Quarter
Conference Call to Discuss Results Today at
Fourth Quarter 2017 Highlights
- GAAP total revenues increased 5% over the fourth quarter of 2016
- Non-GAAP adjusted total revenues, which excludes
U.S. Orbera starter kit sales, increased 9% over the fourth quarter of 2016 - Total Endo-bariatric sales of
$9.8 million , up 29% over the fourth quarter of 2016
Full Year 2017 Highlights
- GAAP total revenues of
$64.3 million in 2017 compared to$64.7 million in 2016 - Non-GAAP adjusted total revenues, which excludes
U.S. Orbera starter kit sales, increased 5% over 2016 - Endo-bariatric sales of
$35.9 million , up 13% over 2016
Fourth Quarter 2017 Results
Total revenues in the fourth quarter of 2017 were
Total Endo-bariatric sales increased 29% to
Total Surgical product sales in the fourth quarter 2017 were
Gross margin for the fourth quarter of 2017 was 58%, compared to 62% for the fourth quarter of 2016 as a result of a greater proportion of our overall product sales coming from our Endo-bariatric products, which realize a lower gross margin than our Surgical products. Additionally, the mix of Apollo manufactured products sold increased in the fourth quarter of 2017 resulting in more overhead charged as cost of goods sold compared to the fourth quarter of 2016 when we were depleting the inventory we purchased as part of the planned transition from Allergan to Apollo. We expect gross margin to improve as we complete certain identified Endo-bariatric product gross margin improvement projects and improve capacity utilization of our manufacturing facility over the next two years.
Total operating expenses were
Interest expense for the fourth quarter of 2017 decreased
Net loss for the fourth quarter 2017 was
Full Year 2017 Financial Results
Total revenues for 2017 were
Total Endo-bariatric sales increased 13% to
Total Surgical product sales in 2017 were
Gross margin increased to 62% for 2017 from 61% in 2016. Cost of sales included inventory impairment charges of
Total operating expenses were
Interest expense decreased
Net loss for 2017 was
Cash, cash equivalents and restricted cash were
Capitalization Update
On
Conference Call
Apollo will host a conference call on
To participate in the conference call dial (888) 394-8218 for domestic callers and (323) 701-0225 for international callers. The conference ID number is 8902763. A live webcast of the conference call will be made available on the “Events and Presentations” section of our Investor Relations website: www.ir.apolloendo.com.
A replay of the webcast will remain available on Apollo’s website, www.apolloendo.com, until Apollo releases its first quarter 2018 financial results. In addition, a telephonic replay of the call will be available until
Non-GAAP Financial Measures
To supplement to our financial results we are providing a non-GAAP financial measure, adjusted total revenues which exclude
Non-GAAP financial information is not a substitute for any financial measure determined in accordance with GAAP and should be read only in conjunction with Apollo’s condensed consolidated financial statements prepared in accordance with GAAP. Apollo’s management uses certain supplemental non-GAAP financial measures internally to understand, manage and evaluate Apollo’s business, and make operating decisions. Reconciliations for each non-GAAP financial measure to its most directly comparable GAAP financial measure is provided in the tables below. Management believes that making non-GAAP financial information available to investors, in addition to GAAP financial information, may facilitate more consistent comparisons between the company’s performance over time with the performance of other companies in the medical device industry, which may use similar financial measures to supplement their GAAP financial information.
About
Apollo’s common stock is traded on Nasdaq Global Market under the symbol “APEN.” For more information regarding
Cautionary Note on Forward-Looking Statements
Certain statements in this press release are forward-looking statements that are subject to risks and uncertainties that could cause results to be materially different than expectations. Important factors that could cause actual results to differ materially include: the advancement of Apollo products; development of enhancements to Apollo’s existing products and technologies; market acceptance of Apollo’s products; and statements relating to the availability of cash for Apollo’s future operations, Apollo’s ability to support the adoption of its endo-bariatric products and its ability to broaden its product portfolio as well as other factors detailed in Apollo’s periodic reports filed with the
| |
||||||||||||||||
| Condensed Consolidated Statements of Operations | ||||||||||||||||
| (In thousands, except for share data) | ||||||||||||||||
| Three Months Ended |
Year Ended |
|||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| (Unaudited) | (Unaudited) | |||||||||||||||
| Revenues | $ | 16,140 | $ | 15,332 | $ | 64,310 | $ | 64,650 | ||||||||
| Cost of sales (1) | 6,834 | 5,899 | 24,578 | 25,255 | ||||||||||||
| Gross margin | 9,306 | 9,433 | 39,732 | 39,395 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Sales and marketing | 8,078 | 7,993 | 32,910 | 31,533 | ||||||||||||
| General and administrative | 3,429 | 4,817 | 13,722 | 13,625 | ||||||||||||
| Research and development | 1,879 | 2,583 | 8,299 | 7,805 | ||||||||||||
| Amortization of intangible assets | 1,796 | 1,794 | 7,240 | 7,193 | ||||||||||||
| Total operating expenses | 15,182 | 17,187 | 62,171 | 60,156 | ||||||||||||
| Loss from operations | (5,876 | ) | (7,754 | ) | (22,439 | ) | (20,761 | ) | ||||||||
| Other expenses: | ||||||||||||||||
| Interest expense, net | 979 | 11,287 | 4,508 | 18,168 | ||||||||||||
| Other expense | 324 | 487 | 41 | 1,851 | ||||||||||||
| Net loss before income taxes | (7,179 | ) | (19,528 | ) | (26,988 | ) | (40,780 | ) | ||||||||
| Income tax expense | 136 | 184 | 304 | 387 | ||||||||||||
| Net loss | $ | (7,315 | ) | $ | (19,712 | ) | $ | (27,292 | ) | $ | (41,167 | ) | ||||
| Net loss per share, basic and diluted | $ | (0.42 | ) | $ | (35.01 | ) | $ | (2.01 | ) | $ | (105.69 | ) | ||||
| Shares used in computing net loss per share, basic and diluted (2) | 17,290,909 | 563,113 | 13,565,781 | 389,501 | ||||||||||||
_________________________________________
| (1) | Cost of sales includes inventory impairment charges of |
|
| (2) | On |
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||||||||||||||||||||||||||||||||
| Product Sales by |
||||||||||||||||||||||||||||||||
| Unaudited (In thousands) | ||||||||||||||||||||||||||||||||
|
Three Months Ended |
Three Months Ended |
% Increase / (Decrease) | ||||||||||||||||||||||||||||||
| |
OUS |
Total |
|
OUS |
Total |
|
OUS |
Total |
||||||||||||||||||||||||
| Endo-bariatric, excluding |
$ | 3,321 | $ | 6,302 | $ | 9,623 | $ | 3,074 | $ | 3,836 | $ | 6,910 | 8.0 | % | 64.3 | % | 39.3 | % | ||||||||||||||
| |
136 |
— |
136 | 650 | — | 650 | (79.1 | )% | — | % | (79.1 | )% | ||||||||||||||||||||
| Total Endo-bariatric | 3,457 | 6,302 | 9,759 | 3,724 | 3,836 | 7,560 | (7.2 | )% | 64.3 | % | 29.1 | % | ||||||||||||||||||||
| Surgical | 4,095 | 2,063 | 6,158 | 5,315 | 2,332 | 7,647 | (23.0 | )% | (11.5 | )% | (19.5 | )% | ||||||||||||||||||||
| Other | 215 | 8 | 223 | 119 | 6 | 125 | 80.7 | % | 33.3 | % | 78.4 | % | ||||||||||||||||||||
| Total revenues | $ | 7,767 | $ | 8,373 | $ | 16,140 | $ | 9,158 | $ | 6,174 | $ | 15,332 | (15.2 | )% | 35.6 | % | 5.3 | % | ||||||||||||||
| % Total revenues | 48.1 | % | 51.9 | % | 59.7 | % | 40.3 | % | ||||||||||||||||||||||||
|
Year Ended |
Year Ended |
% Increase / (Decrease) | ||||||||||||||||||||||||||||||
| |
OUS |
Total |
|
OUS |
Total |
|
OUS |
Total |
||||||||||||||||||||||||
| Endo-bariatric, excluding |
$ | 13,458 |
$ |
21,603 |
$ | 35,061 | $ | 11,175 | $ | 16,383 | $ | 27,558 | 20.4 | % | 31.9 | % | 27.2 | % | ||||||||||||||
| |
862 |
— |
862 | 4,350 |
— |
4,350 | (80.2 | )% | — | % | (80.2 | )% | ||||||||||||||||||||
| Total Endo-bariatric | 14,320 | 21,603 | 35,923 | 15,525 | 16,383 | 31,908 | (7.8 | )% | 31.9 | % | 12.6 | % | ||||||||||||||||||||
| Surgical | 17,366 | 10,227 | 27,593 | 21,560 | 10,706 | 32,266 | (19.5 | )% | (4.5 | )% | (14.5 | )% | ||||||||||||||||||||
| Other | 766 | 28 | 794 | 452 | 24 | 476 | 69.5 | % | 16.7 | % | 66.8 | % | ||||||||||||||||||||
| Total revenues | $ | 32,452 | $ | 31,858 | $ | 64,310 | $ | 37,537 | $ | 27,113 | $ | 64,650 | (13.5 | )% | 17.5 | % | (0.5 | )% | ||||||||||||||
| % Total revenues | 50.5 | % | 49.5 | % | 58.1 | % | 41.9 | % | ||||||||||||||||||||||||
| RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL INFORMATION | |||||||||||
| Unaudited (In thousands) | |||||||||||
|
Three months ended |
% Increase / |
||||||||||
| 2017 | 2016 | ||||||||||
| Total revenues | $ | 16,140 | $ | 15,332 | 5.3 | % | |||||
| Less: |
(136 | ) | (650 | ) | (79.1 | )% | |||||
| Adjusted total revenues, excluding |
$ | 16,004 | $ | 14,682 | 9.0 | % | |||||
|
Year ended |
% Increase / |
||||||||||
| 2017 | 2016 | ||||||||||
| Total revenues | $ | 64,310 | $ | 64,650 | (0.5 | )% | |||||
| Less: |
(862 | ) | (4,350 | ) | (80.2 | )% | |||||
| Adjusted total revenues, excluding |
$ | 63,448 | $ | 60,300 | 5.2 | % | |||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20180301006364/en/
Chief Financial Officer
investor-relations@apolloendo.com
or
apolloendo@theruthgroup.com
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