Accelerate Diagnostics Reports Fourth Quarter and Full-Year 2020 Financial Results

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

BALANCE SHEETS

(in thousands, except share data)

December 31,

2020

2019

ASSETS

Current assets:

Cash and cash equivalents

$

35,781

$

61,014

Investments

32,488

47,437

Trade accounts receivable

1,550

3,222

Inventory

9,216

8,059

Prepaid expenses

1,172

955

Other current assets

1,780

1,165

Total current assets

81,987

121,852

Property and equipment, net

6,135

7,905

Right of use assets

3,183

3,917

Other non-current assets

2,120

750

Total assets

$

93,425

$

134,424

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable

$

1,290

$

2,351

Accrued liabilities

2,991

3,828

Accrued interest

1,262

1,262

Deferred revenue

376

271

Current portion of long-term debt

553

—

Current operating lease liability

497

450

Total current liabilities

6,969

8,162

Non-current operating lease liability

3,063

3,579

Other non-current liabilities

335

19

Long-term debt

4,659

—

Convertible notes

141,211

130,043

Total liabilities

156,237

141,803

Commitments and contingencies

Stockholders' equity (deficit):

Preferred shares, $0.001 par value;

5,000,000 preferred shares authorized and none outstanding as of December 31, 2020 and 2019

—

—

Common stock, $0.001 par value;

85,000,000 common shares authorized with 57,607,939 shares issued and outstanding on December 31, 2020 and 85,000,000 common shares authorized with 54,708,792 shares issued and outstanding on December 31, 2019

58

55

Contributed capital

475,072

452,344

Treasury stock

(45,067)

(45,067)

Accumulated deficit

(492,966)

(414,653)

Accumulated other comprehensive loss

91

(58)

Total stockholders' equity (deficit)

(62,812)

(7,379)

Total liabilities and stockholders' equity (deficit)

$

93,425

$

134,424

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except per share data)

Years Ended December 31,

2020

2019

2018

Net sales

$

11,165

$

9,297

$

5,670

Cost of sales

6,706

4,897

3,187

Gross profit

4,459

4,400

2,483

Costs and expenses:

Research and development

21,255

25,345

27,638

Sales, general and administrative

46,904

51,886

55,214

Total costs and expenses

68,159

77,231

82,852

Loss from operations

(63,700)

(72,831)

(80,369)

Other income (expense):

Interest expense

(15,550)

(14,256)

(10,113)

Foreign currency exchange gain (loss)

252

(124)

(450)

Interest and dividend income

855

2,809

2,845

Other expense, net

(60)

(14)

(28)

Total other expense, net

(14,503)

(11,585)

(7,746)

Net loss before income taxes

(78,203)

(84,416)

(88,115)

Benefit (provision) for income taxes

(5)

111

(211)

Net loss

$

(78,208)

$

(84,305)

$

(88,326)

Basic and diluted net loss per share

$

(1.40)

$

(1.55)

$

(1.62)

Weighted average shares outstanding

56,010

54,506

54,494

Other comprehensive loss:

Net loss

$

(78,208)

$

(84,305)

$

(88,326)

Net unrealized (loss) gain on available-for-sale investments

(2)

193

23

Foreign currency translation adjustment

151

(102)

(172)

Comprehensive loss

$

(78,059)

$

(84,214)

$

(88,475)

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(in thousands)

Shares

Common

Stock

Amount

Contributed

Capital

Accumulated
Deficit

Treasury

stock

Accumulated

Other

Comprehensive

Income (Loss)

Total

Stockholders'

Equity (Deficit)

Balances, January 1, 2018

55,674

$

56

$

360,620

$

(241,972)

$

—

$

—

$

118,704

Net loss

—

—

—

(88,326)

—

—

(88,326)

Exercise of options and restricted stock awards issued

382

—

3,749

—

—

—

3,749

Issuance of common stock under employee purchase plan

35

—

583

—

—

—

583

Unrealized gain on available-for-sale securities

—

—

—

—

—

23

23

Foreign currency translation adjustment

—

—

—

—

—

(172)

(172)

Repurchase of common stock under Prepaid Forward contract

(1,859)

(2)

—

—

(45,067)

—

(45,069)

Issuance of convertible note

—

—

53,283

—

—

—

53,283

Cumulative impact of accounting change

—

—

—

(50)

—

—

(50)

Equity-based compensation

—

—

14,650

—

—

—

14,650

Balances, December 31, 2018

54,232

54

432,885

(330,348)

(45,067)

(149)

57,375

Net loss

—

—

—

(84,305)

—

—

(84,305)

Issuance of common stock

56

—

1,000

—

—

—

1,000

Exercise of options and restricted stock awards issued

396

1

5,364

—

—

—

5,365

Issuance of common stock under employee purchase plan

25

—

458

—

—

—

458

Unrealized gain on available-for-sale securities

—

—

—

—

—

193

193

Foreign currency translation adjustment

—

—

—

—

—

(102)

(102)

Equity-based compensation

—

—

12,637

—

—

—

12,637

Balances, December 31, 2019

54,709

55

452,344

(414,653)

(45,067)

(58)

(7,379)

Net loss

—

—

—

(78,208)

—

—

(78,208)

Exercise of options and restricted stock awards issued

2,858

3

6,059

—

—

—

6,062

Issuance of common stock under employee purchase plan

41

—

359

—

—

—

359

Unrealized loss on available-for-sale securities

—

—

—

—

—

(2)

(2)

Foreign currency translation adjustment

—

—

—

—

—

151

151

Cumulative impact of accounting change

—

—

—

(105)

—

—

(105)

Equity-based compensation

—

—

16,310

—

—

—

16,310

Balances, December 31, 2020

$

57,608

$

58

$

475,072

$

(492,966)

$

(45,067)

$

91

$

(62,812)

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENT OF CASH FLOWS

(in thousands)

Years Ended December 31,

2020

2019

2018

Cash flows from operating activities:

Net loss

$

(78,208)

$

(84,305)

$

(88,326)

Adjustments to reconcile net loss to net cash used in operating activities:

    Depreciation and amortization

2,997

2,602

2,561

    Amortization of investment discount

99

(427)

(621)

    Equity-based compensation expense

16,464

12,618

14,422

    Amortization of debt discount and issuance costs

11,168

9,969

6,849

    Realized loss on available-for-sale securities

3

—

—

    Loss on disposal of property and equipment

785

837

678

Contributions to deferred compensation plan

(357)

—

—

(Increase) decrease in assets:

    Accounts receivable

1,592

(1,362)

86

    Inventory

(1,356)

(3,655)

(4,223)

    Prepaid expense and other assets

(2,087)

(752)

(250)

Increase (decrease) in liabilities:

    Accounts payable

(1,006)

988

(748)

    Accrued liabilities

(909)

(1,327)

1,426

    Accrued interest

—

—

1,262

    Deferred revenue and income

105

54

(904)

    Deferred compensation

316

(34)

32

Net cash used in operating activities

(50,394)

(64,794)

(67,756)

Cash flows from investing activities:

Purchases of equipment

(1,362)

(330)

(998)

Purchase of marketable securities

(46,933)

(50,226)

(120,556)

Proceeds from sales of marketable securities

—

14,500

3,000

Maturities of marketable securities

61,901

88,867

98,416

Net cash provided by (used in) investing activities

13,606

52,811

(20,138)

Cash flows from financing activities:

Proceeds from issuance of common stock

362

1,458

583

Proceeds from exercise of options and warrants

6,059

5,365

3,749

Proceeds from issuance of convertible note

—

—

171,500

Proceeds from debt

5,578

—

—

Payment of debt

(366)

—

—

Prepayment of forward stock repurchase transaction

—

—

(45,069)

Payment of debt issuance costs

—

—

(4,992)

Net cash provided by financing activities

11,633

6,823

125,771

Effect of exchange rate on cash

(78)

(86)

(130)

Increase (decrease) in cash and cash equivalents

(25,233)

(5,246)

37,747

Cash and cash equivalents, beginning of period

61,014

66,260

28,513

Cash and cash equivalents, end of period

$

35,781

$

61,014

$

66,260

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENT OF CASH FLOWS (CONTINUED)

(in thousands)

Years Ended December 31,

2020

2019

2018

Non-cash investing activities:

Transfer of instruments from inventory to property and equipment

$

1,525

$

3,361

$

4,767

Supplemental cash flow information:

Interest paid

$

4,288

$

4,288

$

2,001

Income taxes paid, net of refunds

$

43

$

41

$

651

See accompanying notes to consolidated financial statements.