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Sientra Reports Record Fourth Quarter and Full Year Revenues and Expands Total Addressable Market With New Product Launches

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Continued 2+ year trend of consecutive record quarterly growth; fastest growing brand in the US breast market

Disciplined cash management and enhanced operating leverage for 40% improvement in free cash flow results

Significantly increased total addressable market with the launch of Viality™, a novel, FDA-cleared fat transfer technology, and addition of SimpliDerm®, a leading human Acellular Dermal Matrix (ADM)

IRVINE, Calif., March 30, 2023 (GLOBE NEWSWIRE) -- Sientra, Inc. (NASDAQ: SIEN) (“Sientra” or the “Company”), a medical aesthetics company focused on enhancing lives by advancing the art of plastic surgery, today announced its financial results for the fourth quarter and full year ended December 31, 2022.

Financial and Business Highlights

  • Record Q4 2022 net sales of $25.1 million, representing growth of 11% over the fourth quarter of 2022.
  • Record full year net sales of $90.5 million, representing growth of 12% over 2021.
  • Free cash flow usage of $3.6 million in Q4 2022 compared to a free cash flow usage of $6.0 million in the same period last year.
  • Record high market shares in augmentation and reconstruction, adding 131 new augmentation accounts and 142 reconstruction accounts.
  • Continued to expand international footprint with approval to market breast implants in the United Arab Emirates.
  • Launched Viality, the first and only enhanced viability fat transfer system, providing high fat retention and predictable patient outcomes.
  • Released preliminary results from Viality clinical study showing over 80% volume retention at the 3- and 6-month time points.
  • Entered into partnership with Azyio Biologics for the promotion of SimpliDerm, an Acellular Dermal Matrix (ADM).

“2023 promises to be a pivotal year in the transformation of Sientra,” commented Ron Menezes, Sientra’s President and Chief Executive Officer. “Since I joined Sientra, the Company has been focused on creating a platform to profitably delivery industry-leading products to our plastic surgeon customers and their patients. We are now seeing the results of those efforts.”

“In March of this year, we began commercially shipping our Viality fat transfer system to customers. We are extremely encouraged by the early reception of this product, and believe that Viality, which is the only system to have clinically demonstrated over 80% volume retention in a multi-center study at the preliminary 3- and 6-month time points, will set the new standard for fat transfer. We are also extremely excited to have announced our partnership with Aziyo Biologics to distribute their SimpliDerm Acellular Dermal Matrix (ADM) product, creating what we believe is the most compelling reconstruction portfolio in the industry.”

“The launch of these two products dramatically increases the size of Sientra’s total addressable market to over $1 billion in the United States alone. Importantly, it also does so by utilizing Sientra’s existing commercial infrastructure, without any significant capital investments, which we believe will allow us to exit 2023 with a positive free cash flow run rate,” concluded Mr. Menezes.

Fourth Quarter 2022 Financial Results

  • Total net sales were $25.1 million, an increase of 11% compared to total net sales of $22.6 million for the same period in 2021.
  • Gross profit for the fourth quarter 2022 was $3.2 million, or 13% of sales, compared to gross profit of $12.3 million, or 54% of sales, for the same period in 2021. The fourth quarter 2022 included non-cash adjustments related to inventory reserve and warranty liability. Excluding these adjustments, fourth quarter 2022 gross profit was $15.0 million, or 60% of sales.
  • GAAP operating expenses for the fourth quarter 2022 of $27.7 million compared to $26.1 million for the same period in 2021.
  • Loss from continuing operations for the fourth quarter 2022 was $22.4 million, or $2.35 per share, compared to a net loss of $15.9 million, or $2.73 per share, for the same period in 2021.
  • Non-GAAP operating expenses for the fourth quarter of 2022 were $22.8 million compared to $22.2 million for the same period in 2021.
  • Adjusted EBITDA loss for the fourth quarter 2022 was $6.9 million as compared to a net loss of $9.3 million for the same period in 2021.
  • Net cash and cash equivalents as of December 31, 2022, were $26.1 million, compared to $51.8 million on December 31, 2021.

Full Year 2022 Financial Results

  • Total net sales for the full year 2022 were $90.5 million, an increase of 12% compared to total net sales of $80.7 million for the same period in 2021.
  • Gross profit for the full year 2022 was $41.6 million, or 46% of sales, compared to gross profit of $44.3 million, or 55% of sales, for the full year 2021. Excluding the adjustments, full year 2022 gross profit was $53.4 million, or 59% of sales.
  • GAAP operating expenses for the full year 2022 increased by 22% to $110.6 million from $90.7 million for the full year 2021, primarily driven by current year investments in commercial activities to support new product launches.
  • Loss from continuing operations for the full year 2022 was $73.7 million, or a net loss of $10.40 per share, compared to a net loss of $62.5 million, or $10.96 per share, for the full year 2021.
  • Non-GAAP operating expenses for the full year 2022 were $91.6 million compared to $76.3 million for the full year 2021.
  • Adjusted EBITDA loss for the full year 2022 of $36.5 million compared to a net loss of $29.8 million for the full year 2021.

Full Year 2022 Guidance
For full year 2023, the Company expects to achieve total net sales of $104 million to $109 million, representing growth of 15% to 20% compared to net sales of $90.5 million in 2022. Non-GAAP operating expense is expected to be $78 million to $82 million, representing a 10% to 15% decrease compared to non-GAAP operating expenses of $91.6 million in 2022.

Use of Non-GAAP Financial Measures
Sientra has supplemented its US GAAP net income (loss) with a non-GAAP measure of Adjusted EBITDA, US GAAP Operating Expenses with a non-GAAP measure of Non-GAAP Operating Expenses, and US GAAP cash flow from operating activities with a non-GAAP measure of Free Cash Flow. Management believes that these non-GAAP financial measures provide useful supplemental information to management and investors regarding the performance of the Company, facilitate a more meaningful comparison of results for current periods with previous operating results, and assist management in analyzing future trends, making strategic and business decisions and establishing internal budgets and forecasts. Reconciliations of non-GAAP Adjusted EBITDA, Non-GAAP Operating Expenses, and Free Cash Flow to GAAP net income (loss), GAAP Operating Expenses and Cash flow from operating activities, the most directly comparable GAAP measures, are provided in the schedules below. In the current period, management added “Bad debt expense” as an adjustment to the non-GAAP measure of Adjusted EBITDA to align with internal targets, budgets and forecasts. The prior periods have been recast to conform with the current period presentation. There are limitations in using these non-GAAP financial measures because they are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with Sientra’s financial statements prepared in accordance with GAAP and the reconciliations of the non-GAAP financial measures provided in the schedules below.

About Sientra

Headquartered in Irvine, California, Sientra is a medical aesthetics company exclusively focused on plastic surgery. The Company mission is to offer proprietary innovations and unparalleled partnerships that radically advance how plastic surgeons think, work and care for their patients. Sientra has developed a broad portfolio of products with technologically differentiated characteristics, supported by independent laboratory testing and strong clinical trial outcomes. The Company’s product portfolio includes its Sientra round and shaped breast implants, the first fifth generation breast implants approved by the FDA for sale in the United States, its ground-breaking Allox2® breast tissue expander with patented dual-port and integral drain technology, Viality™ fat transfer system, and BIOCORNEUM®, the #1 performing, preferred and recommended scar gel of plastic surgeons (*).

Sientra uses its investor relations website to publish important information about the Company, including information that may be deemed material to investors. Financial and other information about Sientra is routinely posted and is accessible on the Company’s investor relations website at www.sientra.com.
(*) Data on file

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, based on management’s current assumptions and expectations of future events and trends, which affect or may affect the Company’s business, strategy, operations or financial performance, and actual results may differ materially from those expressed or implied in such statements due to numerous risks and uncertainties. Forward-looking statements are made only as of the date of this release. The words “believe,” “may,” “might,” “could,” “will,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “plan,” “position,” or the negative of those terms, and similar expressions that convey uncertainty of future events or outcomes are intended to identify estimates, projections and other forward-looking statements. Forward-looking statements may include information concerning the Company’s unaudited financial information for the fourth quarter and full year ended December 31, 2022, the Company’s possible or assumed future results of operations, including descriptions of the Company’s revenues, profitability, outlook and overall business strategy, the Company’s ability to successfully launch the Viality fat transfer system, the Company’s ability to successfully integrate the SimpliDerm ADM into its existing operations, the reception of plastic surgeons to the Company’s products, including the Viality fat transfer system and the SimpliDerm ADM, the anticipated future clinical results of the Viality multi-center volume retention study, the Company’s estimates of its total addressable market, and the Company’s ability to capture additional market share and customer accounts in the plastic surgery market. Such statements are subject to risks and uncertainties, including the audit of the Company’s financial statements which audit is not yet complete and the numbers presented here could differ from the final audited financial statements presented by the Company, the Company’s ability to recapture delayed procedures resulting from the COVID-19 pandemic, the positive reaction from plastic surgeons and their patients to the Company’s product portfolio, including the Viality fat transfer system and the SimpliDerm ADM, the ability to meet consumer demand, the growth of the plastic surgery market and breast procedures, the outcomes of the Company’s clinical studies, and the ability of the Company to execute on its commercial, marketing, research and development and regulatory plans. Additional factors that could cause actual results to differ materially from those contemplated in this press release can be found in the Risk Factors section of Sientra’s public filings with the Securities and Exchange Commission. All statements other than statements of historical fact are forward-looking statements. The words “believe,” “may,” “might,” “could,” “will,” “aim,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “plan,” “position,” or the negative of those terms, and similar expressions that convey uncertainty of future events or outcomes are intended to identify estimates, projections and other forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, and such estimates, projections and other forward-looking statements speak only as of the date they were made, and, except to the extent required by law, the Company undertakes no obligation to update or review any estimate, projection or forward-looking statement. Actual results may differ from those set forth in this press release due to the risks and uncertainties inherent in the Company’s business.

Investor Relations Contact
Aman R. Patel, CFA
aman.patel@westwicke.com


Sientra, Inc. 
Consolidated Statements of Operations 
(In thousands, except per share and share amounts) 
(Unaudited) 
             
  Three Months Ended  Year Ended 
  December 31,  December 31, 
  2022  2021  2022  2021 
Net sales $25,068  $22,648  $90,549  $80,683 
Cost of goods sold  21,837   10,321   48,955   36,348 
Gross profit  3,231   12,327   41,594   44,335 
Operating expenses:            
Sales and marketing  13,507   14,108   55,049   48,456 
Research and development  4,240   3,494   14,063   10,456 
General and administrative  9,943   8,452   41,532   31,773 
Total operating expenses  27,690   26,054   110,644   90,685 
Loss from operations  (24,459)  (13,727)  (69,050)  (46,350)
Other (expense) income, net:            
Interest income  72      130   4 
Interest expense  (2,941)  (2,111)  (9,525)  (8,254)
(Loss) gain on extinguishment of debt  (4,040)     (4,040)  6,652 
Change in fair value of derivative liability  8,780      8,780   (14,460)
Other income (expense), net  221   (13)  12   (89)
Total other (expense) income, net  2,092   (2,124)  (4,643)  (16,147)
(Loss) income from continuing operations before income taxes  (22,367)  (15,851)  (73,693)  (62,497)
Income tax expense  27   21   27   21 
Income (loss) from continuing operations  (22,394)  (15,872)  (73,720)  (62,518)
Income (loss) from discontinued operations, net of income taxes     (196)     37 
Net (loss) income $(22,394) $(16,068) $(73,720) $(62,481)
Basic and diluted net loss per share attributable to
   common stockholders
            
Continuing operations $(2.35) $(2.73) $(10.40) $(10.96)
Discontinued operations     (0.03)     0.01 
Basic and diluted net loss per share $(2.35) $(2.76) $(10.40) $(10.95
Sientra, Inc.

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Surgical and Medical Instrument Manufacturing
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