Misonix Reports Fiscal 2021 Third Quarter Financial Results
05/06/2021 - 04:01 PM
Misonix Raises Guidance for neXus® Ultrasonic Surgical System to 200 Unit Placements by Fiscal 2021 Year-End
FARMINGDALE, N.Y., May 06, 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 third quarter ended March 31, 2021 as summarized below:
Three Months Ended Nine Months Ended March 31, March 31, 2021 2020 2021 2020 Revenue $ 18,347,180 $ 17,902,512 $ 54,338,932 $ 48,770,419 Gross profit $ 12,944,426 $ 12,590,947 $ 38,560,879 $ 34,277,098 Gross profit percentage 70.6 % 70.3 % 71.0 % 70.3 % Pretax loss $ (3,756,804 ) $ (6,043,477 ) $ (10,000,053 ) $ (13,420,961 ) Income tax benefit $ - $ (455,000 ) $ - $ (4,540,000 ) Net loss $ (3,756,804 ) $ (5,588,477 ) $ (10,000,053 ) $ (8,880,961 ) EBITDA (1) $ (1,754,517 ) $ (4,269,601 ) $ (3,873,503 ) $ (9,348,944 ) Adjusted EBITDA (1) $ (1,009,524 ) $ (3,787,398 ) $ (1,609,366 ) $ (5,403,621 ) March 31, June 30, 2021 2020 Cash and cash equivalents $ 30,913,686 $ 37,978,809 Current and Long Term Debt $ 43,395,248 $ 43,695,249
(1) Definitions and disclosures regarding non-GAAP financial information including reconciliations are included at the end of this press release.
Third Quarter Fiscal Year 2021 Highlights:
Fiscal 2021 third quarter revenue of $18.3 million increased 2.5% , compared to $17.9 million in the fiscal 2020 third quarter. Domestic surgical revenue increased 14.7% International surgical revenue increased 11.8% Domestic wound revenue declined 9.8% Gross profit percentage on sales for the fiscal 2021 third quarter increased to 70.6% , compared with 70.3% in the fiscal 2020 third quarter. Operating expenses decreased 11.6% during the fiscal 2021 third quarter as compared with the fiscal 2020 third quarter, reflecting improved cost management. Net loss for the fiscal 2021 third quarter narrowed to $3.8 million , or a loss of $0.22 per diluted share, compared to a net loss of $5.6 million , or a loss of $0.34 per diluted share, in the fiscal 2020 third quarter. Fiscal 2021 third quarter Adjusted EBITDA improved to a loss of $1.0 million , compared to an Adjusted EBITDA loss of $3.8 million in the fiscal 2020 third quarter. In March 2021, Misonix received a Health Canada license for the neXus® Ultrasonic Surgical System, allowing the Company to commercialize neXus, along with its various handpieces and disposable products, across Canada. Following the successful launch of the neXus Ultrasonic Surgical System in select international markets and continued strong demand domestically, the Company now expects to place 200 neXus units by fiscal 2021 year-end, an increase from its previous guidance of 180 units. Stavros Vizirgianakis, President and Chief Executive Officer of Misonix stated, “Our fiscal third quarter 2021 results mark a return to top-line growth for the first time since the peak of the COVID-19 pandemic last June and reflects growing demand for our proprietary ultrasonic products and procedural solutions as market conditions improve. Total fiscal third quarter revenue growth of 2.5% year-over-year, combined with the ongoing success of our team in strategically shifting and accelerating key priorities across our business resulted in a 2.8% year-over-year increase in gross profit with a strong gross margin of 70.6% .
“Accelerating demand for our neXus Ultrasonic Surgical System and record BoneScalpel and SonaStar product sales growth drove a 13.7% year-over-year increase in fiscal third quarter total surgical revenue, including 14.7% growth domestically and 11.8% growth internationally. Recall, we recorded 41% year-over-year domestic surgical revenue growth in the comparable fiscal third quarter of 2020 following the launch of neXus in the United States. As such, we are pleased with our ability to achieve mid-teens domestic surgical revenue growth in the current quarter despite the difficult comparison. Though our wound business remains challenged, our SonicOne product sales increased 26% quarter over quarter and we believe that our regenerative products are on an improved trajectory as treatment begins to return to wound care centers.
“During the fiscal third quarter, we launched neXus in select international markets including Canada and parts of the European Union, as well as a number of other select countries. The tremendous response we have received from global healthcare practitioners to-date is further affirmation of the efficiency and efficacy our ultrasonic technology delivers in treating procedures across spine surgery, neurosurgery, orthopedic surgery, laparoscopic surgery, and wound care. We also announced a new range of extremity fixation products to address the orthoplastics market, which complement our existing wound debridement and regenerative products portfolio. By creating a more encompassing offering, we not only significantly increase our average revenue per procedure, but also believe that we have further enhanced physicians’ ability to improve patient outcomes.
“In summary, we are encouraged by the early signs of a recovery that we are seeing across our business in both surgical and wound. The overall operating environment has continued to improve, though there are some clear differences by geography and procedural focus. Looking ahead, we expect to see an acceleration in our surgical business and a return to growth in our wound segment beginning in the second half of calendar 2021. 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 move deeper into the recovery phase. We are confident this approach will enable Misonix to deliver on goals for long-term profitable growth and enhanced shareholder value.”
Sales Performance Supplemental Data
For the three months ended March 31, Net change 2021 2020 $ % Total Surgical $ 10,351,130 $ 9,102,711 $ 1,248,419 13.7 % Wound 7,996,050 8,799,801 (803,751 ) -9.1 % Total $ 18,347,180 $ 17,902,512 $ 444,668 2.5 % Domestic: Surgical $ 6,940,825 $ 6,052,548 $ 888,277 14.7 % Wound 7,872,060 8,725,868 (853,808 ) -9.8 % Total $ 14,812,885 $ 14,778,416 $ 34,469 0.2 % International: Surgical $ 3,410,305 $ 3,050,163 $ 360,142 11.8 % Wound 123,990 73,933 50,057 67.7 % Total $ 3,534,295 $ 3,124,096 $ 410,199 13.1 %
Joe Dwyer, Chief Financial Officer, added, “We are encouraged by our ability to generate product revenue growth both on a year-over-year and quarterly sequential basis against the backdrop of a difficult, albeit improving, operating environment. Notably, the various initiatives we have implemented over the last year to streamline our cost structure enabled us to meaningfully reduce third quarter operating expenses by 11.6% , or $2.1 million , compared to the prior year period. Top line growth, combined with healthy gross margins of over 70% and lower operating expenses, resulted in a 73.3% year-over-year improvement in Adjusted EBITDA to a loss of $1.0 million in the fiscal 2021 third quarter, compared to a loss of $3.8 million in the prior year.
“We continued to deliver on our goal of lowering our cash burn and recently restructured our term debt to lower our borrowing rate and extend the maturity date and debt repayment schedule. With a strong balance sheet reflecting approximately $31 million in cash at March 31, 2021, we are confident that our liquidity position will support the continued investment in our business and our goals for growth. We continue to see an improvement in general market conditions and procedural volumes across most of our markets as the vaccine rollout progresses. Assuming this trend continues without any further disruptions, we expect to generate fiscal 2021 full year revenue of $72.8 million to $73.3 million .”
Fiscal Third Quarter 2021 Conference Call and Webcast Misonix will host a conference call and webcast today, May 6, 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: 9869811. 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 631-927-9113
Misonix, Inc. and Subsidiaries Condensed Consolidated Statements of Operations (Unaudited) For the three months ended For the nine months ended March 31, March 31, 2021 2020 2021 2020 Revenue $ 18,347,180 $ 17,902,512 $ 54,338,932 $ 48,770,419 Cost of revenue 5,402,754 5,311,565 15,778,053 14,493,321 Gross profit 12,944,426 12,590,947 38,560,879 34,277,098 Operating expenses: Selling expenses 10,891,292 11,609,943 30,284,046 28,611,090 General and administrative expenses 3,631,175 4,463,467 12,002,453 13,820,989 Research and development expenses 1,317,036 1,842,837 3,535,587 3,701,697 Total operating expenses 15,839,503 17,916,247 45,822,086 46,133,776 Loss from operations (2,895,077 ) (5,325,300 ) (7,261,207 ) (11,856,678 ) Other income (expense): Interest income 4,519 37,785 8,531 61,954 Interest expense (866,464 ) (755,528 ) (2,749,292 ) (1,624,659 ) Other 218 (434 ) 1,915 (1,578 ) Total other expense (861,727 ) (718,177 ) (2,738,846 ) (1,564,283 ) Loss from operations before income taxes (3,756,804 ) (6,043,477 ) (10,000,053 ) (13,420,961 ) Income tax benefit - 455,000 - 4,540,000 Net loss $ (3,756,804 ) $ (5,588,477 ) $ (10,000,053 ) $ (8,880,961 ) Net loss per share: Basic $ (0.22 ) $ (0.34 ) $ (0.58 ) $ (0.64 ) Diluted $ (0.22 ) $ (0.34 ) $ (0.58 ) $ (0.64 ) Weighted average shares - Basic 17,226,181 16,619,981 17,219,221 13,841,032 Weighted average shares - Diluted 17,226,181 16,619,981 17,219,221 13,841,032
Misonix, Inc. and Subsidiaries Condensed Consolidated Balance Sheets March 31, June 30, 2021 2020 (Unaudited) Assets Current assets: Cash and cash equivalents $ 30,913,686 $ 37,978,809 Accounts receivable, less allowance for doubtful accounts of $2,265,401 and $2,573,968, respectively 12,034,563 11,064,768 Inventories, net 14,413,671 14,010,684 Prepaid expenses and other current assets 785,859 1,668,244 Total current assets 58,147,779 64,722,505 Property, plant and equipment, net of accumulated amortization and depreciation of $14,720,985 and $12,715,917, respectively 8,860,056 7,304,258 Patents, net of accumulated amortization of $1,462,069 and $1,341,976, respectively 763,900 784,318 Goodwill 108,234,664 108,310,350 Intangible assets 20,112,955 21,281,136 Lease right-of-use assets 1,108,454 1,098,830 Other assets 307,909 322,310 Total assets $ 197,535,717 $ 203,823,707 Liabilities and shareholders' equity Current liabilities: Accounts payable $ 5,850,797 $ 4,273,568 Accrued expenses and other current liabilities 7,862,497 7,515,751 Current portion of lease liabilities 508,924 414,058 Current portion of notes payable 4,621,766 5,099,744 Total current liabilities 18,843,984 17,303,121 Non-current liabilities: Notes payable 38,773,482 38,595,505 Lease liabilities 645,804 723,553 Deferred tax liabilities 33,293 33,293 Other non-current liabilities 227,599 516,665 Total liabilities 58,524,162 57,172,137 Commitments and contingencies Shareholders' equity Common stock, $.0001 par value; shares authorized 40,000,000; 17,405,845 and 17,369,435 shares issued and outstanding in each period 1,741 1,737 Additional paid-in capital 188,321,138 185,961,104 Accumulated deficit (49,311,324 ) (39,311,271 ) Total shareholders' equity 139,011,555 146,651,570 Total liabilities and shareholders' equity $ 197,535,717 $ 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.
Nine Months Ended March 31, Net Change 2021 2020 $ % Revenue as reported $ 54,338,932 $ 48,770,419 $ 5,568,513 11.4 % Solsys revenue - 8,381,196 Pro forma revenue $ 54,338,932 $ 57,151,615 $ (2,812,683 ) -4.9 %
Three Months Ended Nine Months Ended March 31, March 31, 2021 2020 2021 2020 EBITDA: Net loss $ (3,756,804 ) $ (5,588,477 ) $ (10,000,053 ) $ (8,880,961 ) Income tax benefit - (455,000 ) - (4,540,000 ) Depreciation and amortization 1,135,823 1,018,348 3,377,258 2,447,359 Interest expense 866,464 755,528 2,749,292 1,624,658 EBITDA (1,754,517 ) (4,269,601 ) (3,873,503 ) (9,348,944 ) Non-cash stock compensation 744,993 482,203 2,264,137 1,231,939 Reserve for contract asset - - - 960,000 M&A transaction fees - - - 1,753,384 Adjusted EBITDA $ (1,009,524 ) $ (3,787,398 ) $ (1,609,366 ) $ (5,403,621 )
