Misonix Reports Fiscal 2021 Second Quarter Financial Results
02/04/2021 - 04:01 PM
FARMINGDALE, N.Y., Feb. 04, 2021 (GLOBE NEWSWIRE) -- Misonix, Inc. (Nasdaq: MSON) (“Misonix” or the “Company”), a provider of minimally invasive therapeutic ultrasonic medical devices and regenerative products that enhance clinical outcomes, today reported financial results for the fiscal 2021 second quarter ended December 31, 2020 as summarized below:
Three Months Ended Six Months Ended December 31, December 31, 2020 2019 2020 2019 Revenue $ 18,256,410 $ 19,721,986 $ 35,991,752 $ 30,867,908 Gross profit $ 12,991,711 $ 13,776,878 $ 25,616,452 $ 21,686,153 Gross profit percentage 71.2 % 69.9 % 71.2 % 70.3 % Pretax loss $ (1,264,597 ) $ (5,088,973 ) $ (6,243,249 ) $ (7,377,481 ) Income tax benefit $ - $ - $ - $ 4,085,000 Net loss $ (1,264,597 ) $ (5,088,973 ) $ (6,243,249 ) $ (3,292,481 ) EBITDA (1) $ 802,564 $ (3,290,062 ) $ (2,118,986 ) $ (5,082,177 ) Adjusted EBITDA (1) $ 1,555,575 $ (1,925,410 ) $ (599,842 ) $ (1,617,966 ) December 31, June 30, 2020 2020 Cash and cash equivalents $ 32,833,836 $ 37,978,809 Current and Long Term Debt $ 43,895,249 $ 43,695,249
(1) Definitions and disclosures regarding non-GAAP financial information including reconciliations are included at the end of this press release.
Second Quarter Fiscal Year 2021 Highlights:
The novel coronavirus disease (“COVID-19”) continued to materially impact the industry and Misonix’s business in the first and second quarters of fiscal 2021 as elective procedures were delayed in order to treat patients affected by the COVID-19 pandemic and to allow health providers to comply with new safety measures. Fiscal 2021 second quarter revenue of $18.3 million decreased 7.4% , compared to $19.7 million in the fiscal 2020 second quarter. Domestic surgical revenue increased 19.8% International revenue declined 23.1% Domestic wound revenue declined 16.2% Gross profit percentage on sales for the fiscal 2021 second quarter increased approximately 130 basis points to 71.2% , compared with 69.9% in the fiscal 2020 first quarter. Operating expenses decreased 26.2% during the fiscal 2021 second quarter as compared with the fiscal 2020 second quarter, reflecting improved cost management, a net $1.2 million bad debt recovery in the fiscal 2021 second quarter, and $1.0 million contract asset write off in the prior year. Excluding the bad debt and contract asset activity, operating expenses were 15.0% lower during the second quarter compared to the prior year. Net loss for the fiscal 2021 second quarter narrowed to $1.3 million , or a loss of $0.07 per diluted share, compared to a net loss of $5.1 million , or a loss of $0.33 per diluted share, in the fiscal 2020 second quarter. Fiscal 2021 second quarter Adjusted EBITDA improved to positive $1.6 million , compared to an Adjusted EBITDA loss of $1.9 million in the fiscal 2020 second quarter. In December 2020, Misonix announced that the second largest U.S. commercial payer is now covering TheraSkin for the treatment of all lower extremity wounds, expanding TheraSkin’s coverage by approximately 32 million lives. Stavros Vizirgianakis, President and Chief Executive Officer of Misonix stated, “While COVID-19 remains a challenge for the global healthcare industry, our fiscal 2021 second quarter results reflect the ongoing strong execution by our team in generating sequential growth in total product revenue since the peak of the pandemic in June, as well as significantly improved financial performance since that time. Notably, the meaningful measures we have taken to reduce costs and improve operating efficiencies over the past nine months, combined with our strong gross profit margin of approximately 70% , enabled us to achieve positive second fiscal quarter adjusted EBITDA.
“During the second fiscal quarter, the continued strength of neXus drove a year-over-year increase in domestic surgical revenue of nearly 20% , which is largely in-line with our historical growth levels, while domestic wound sales and international product sales remain more impacted by COVID-19. With the continued healthy adoption of neXus and a growing footprint from which to expand our business, we expect to return to pre-pandemic top-line growth when we return to a more normalized environment. As such, we remain focused on developing and refining our commercial infrastructure, including acquiring additional sales resources, to ensure that we are in the best position to drive market share gains and further adoption of our surgical and regenerative products as we emerge from the pandemic.
“As we enter the second half of fiscal 2021, we are excited about the opportunities to grow organically by leveraging our proprietary ultrasonic technology and expanding the procedures we participate in, as well as the potential for additional distribution partnerships to further our offering across both surgical and wound. We are actively managing the business to best position Misonix for the future and remain confident in our ability to achieve our goals for long-term profitable growth and enhanced shareholder value.”
Sales Performance Supplemental Data
For the three months ended December 31, Net change 2020 2019 $ % Total Surgical $ 10,119,125 $ 9,988,559 $ 130,566 1.3 % Wound 8,137,285 9,733,427 (1,596,142 ) -16.4 % Total $ 18,256,410 $ 19,721,986 $ (1,465,576 ) -7.4 % Domestic: Surgical $ 6,771,467 $ 5,652,381 $ 1,119,086 19.8 % Wound 8,054,039 9,606,332 (1,552,293 ) -16.2 % Total $ 14,825,506 $ 15,258,713 $ (433,207 ) -2.8 % International: Surgical $ 3,347,658 $ 4,336,178 $ (988,520 ) -22.8 % Wound 83,246 127,095 (43,849 ) -34.5 % Total $ 3,430,904 $ 4,463,273 $ (1,032,369 ) -23.1 %
Joe Dwyer, Chief Financial Officer, added, “We are pleased with the healthy sequential growth in product revenue from $17.7 million in our fiscal first quarter to $18.3 million in the current quarter against the backdrop of a difficult operating environment. Notably, the actions we have taken since the beginning of the pandemic to streamline our cost structure enabled us to meaningfully lower cash used in operations to $1.4 million in the current quarter, and report positive Adjusted EBITDA of $1.6 million in the fiscal 2021 second quarter, compared to an Adjusted EBITDA loss of $1.9 million in the prior year. In addition, we continue to lower our cash burn, and have restructured our term debt to lower our borrowing rate, extend the maturity date, and extend the debt repayment schedule.
“With a strong balance sheet reflecting over $32 million in cash at December 31, 2020, we believe Misonix is well positioned to withstand the near-term challenges related to COVID-19 and remain confident in the long-term prospects of our business. Although it is difficult to predict what the impact of COVID-19 will be in the coming months, we are optimistic that procedural volumes will grow as we move further into the year, following broad vaccine distribution.”
Fiscal Second Quarter 2021 Conference Call and Webcast Misonix will host a conference call and webcast today, February 4, 2021, at 4:30 p.m. ET to discuss its financial results and operations, and host a question and answer session. The dial-in number for the audio conference call is 866-248-8441 (domestic) or 323-289-6576 (international) conference ID: 2793331. Participants may also listen to a live webcast of the call at the Company’s website through the “Events and Presentations” section under “Investor Relations” at www.misonix.com . Following its completion, a replay of the webcast will be available for 30 days on the Company’s website, www.misonix.com
About Misonix, Inc. www.misonix.com .
Safe Harbor Statement
Contact: Joe Dwyer Norberto Aja, Jennifer Neuman Chief Financial Officer JCIR Misonix, Inc. 212-835-8500 or mson@jcir.com 631-694-9555
Misonix, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited)
For the three months ended For the six months ended December 31, December 31, 2020 2019 2020 2019 Revenue $ 18,256,410 $ 19,721,986 $ 35,991,752 $ 30,867,908 Cost of revenue 5,264,699 5,945,108 10,375,300 9,181,755 Gross profit 12,991,711 13,776,878 25,616,452 21,686,153 Operating expenses: Selling expenses 8,423,075 11,800,565 19,392,753 17,001,147 General and administrative expenses 3,918,950 5,149,715 8,371,277 9,357,522 Research and development expenses 968,377 1,087,449 2,218,551 1,858,860 Total operating expenses 13,310,402 18,037,729 29,982,581 28,217,529 Loss from operations (318,691 ) (4,260,851 ) (4,366,129 ) (6,531,376 ) Other income (expense): Interest income 2,920 5,293 4,012 24,170 Interest expense (949,105 ) (833,035 ) (1,882,828 ) (869,132 ) Other 279 (380 ) 1,696 (1,143 ) Total other expense (945,906 ) (828,122 ) (1,877,120 ) (846,105 ) Loss from operations before income taxes (1,264,597 ) (5,088,973 ) (6,243,249 ) (7,377,481 ) Income tax benefit - - - 4,085,000 Net loss $ (1,264,597 ) $ (5,088,973 ) $ (6,243,249 ) $ (3,292,481 ) Net loss per share: Basic $ (0.07 ) $ (0.33 ) $ (0.36 ) $ (0.26 ) Diluted $ (0.07 ) $ (0.33 ) $ (0.36 ) $ (0.26 ) Weighted average shares - Basic 17,217,948 15,222,870 17,215,817 12,439,860 Weighted average shares - Diluted 17,217,948 15,222,870 17,215,817 12,439,860
Misonix, Inc. and Subsidiaries Condensed Consolidated Balance Sheets
December 31, June 30, 2020 2020 (Unaudited) Assets Current assets: Cash and cash equivalents $ 32,833,836 $ 37,978,809 Accounts receivable, less allowance for doubtful accounts of $2,202,392 and $2,573,968, respectively 11,077,214 11,064,768 Inventories, net 13,222,262 14,010,684 Prepaid expenses and other current assets 1,248,170 1,668,244 Total current assets 58,381,482 64,722,505 Property, plant and equipment, net of accumulated amortization and depreciation of $14,089,699 and $12,715,917, respectively 8,023,305 7,304,258 Patents, net of accumulated amortization of $1,413,910 and $1,341,976, respectively 786,007 784,318 Goodwill 108,234,664 108,310,350 Intangible assets 20,485,417 21,281,136 Lease right-of-use assets 1,202,017 1,098,830 Other assets 246,230 322,310 Total assets $ 197,359,122 $ 203,823,707 Liabilities and shareholders' equity Current liabilities: Accounts payable $ 2,656,252 $ 4,273,568 Accrued expenses and other current liabilities 7,075,399 7,515,751 Current portion of lease liabilities 508,870 414,058 Current portion of notes payable 2,888,604 5,099,744 Total current liabilities 13,129,125 17,303,121 Non-current liabilities: Notes payable 41,006,645 38,595,505 Lease liabilities 739,714 723,553 Deferred tax liabilities 33,293 33,293 Other non-current liabilities 498,938 516,665 Total liabilities 55,407,715 57,172,137 Commitments and contingencies Shareholders' equity Common stock, $.0001 par value; shares authorized 40,000,000; 17,377,748 and 17,369,435 shares issued and outstanding in each period 1,738 1,737 Additional paid-in capital 187,504,189 185,961,104 Accumulated deficit (45,554,520 ) (39,311,271 ) Total shareholders' equity 141,951,407 146,651,570 Total liabilities and shareholders' equity $ 197,359,122 $ 203,823,707
Use of Non-GAAP Financial Measures
The Company has also provided below pro-forma revenue, which is also a non-GAAP financial measurement. The Company acquired the operations of Solsys Medical at the end of its first fiscal quarter ended September 30, 2019. The Company has presented pro forma revenue to show revenue on a comparable basis as if Solsys had been acquired at the beginning of the comparative periods presented.
We present these non-GAAP measures because we believe these measures are useful indicators of our operating performance. Our management uses these non-GAAP measures principally as a measure of our operating performance and believes that these measures are useful to investors because they are frequently used by analysts, investors and other interested parties to evaluate the operating performance of companies in our industry. We also believe that these measures are useful to our management and investors as a measure of comparative operating performance from period to period.
Six Months Ended December 31, Net Change 2020 2019 $ % Revenue as reported $ 35,991,752 $ 30,867,908 $ 5,123,844 16.6 % Solsys revenue - 8,344,795 Pro forma revenue $ 35,991,752 $ 39,212,703 $ (3,220,951 ) -8.2 % Three Months Ended Six Months Ended December 31, December 31, 2020 2019 2020 2019 EBITDA: Net loss $ (1,264,597 ) $ (5,088,973 ) $ (6,243,249 ) $ (3,292,481 ) Income tax benefit - - - (4,085,000 ) Depreciation and amortization 1,118,056 965,876 2,241,435 1,426,172 Interest expense 949,105 833,035 1,882,828 869,132 EBITDA 802,564 (3,290,062 ) (2,118,986 ) (5,082,177 ) Non-cash stock compensation 753,011 404,652 1,519,144 749,736 Reserve for contract asset - 960,000 - 960,000 M&A transaction fees - - - 1,754,475 Adjusted EBITDA $ 1,555,575 $ (1,925,410 ) $ (599,842 ) $ (1,617,966 )
