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Sientra Reports Record Third Quarter 2022 Financial Results

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SANTA BARBARA, Calif., Nov. 10, 2022 (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 third quarter that ended September 30, 2022.

Q3 2022 Financial and Business Highlights

  • Net sales of $22.6 million, representing growth of 15% over the third quarter of 2021
  • Year-to-date net sales of $65.5 million, representing growth of nearly 13% compared to the same period of 2021
  • Reduced free cash outflow to a record low of $3.6 million
  • Added 130 new augmentation accounts, and 160 new reconstruction accounts
  • Received approval of Sientra’s breast implants in the Kingdom of Saudi Arabia, and approval for Low Plus Profile implants from Health Canada
  • Entered into a new debt facility with Deerfield, and completed a secondary equity offering to provide enhanced balance sheet flexibility
  • Advanced preparations for launch of novel enhanced viability fat transfer system at Beauty Through Science meeting in New York on December 1-3

Ron Menezes, Sientra’s President, and Chief Executive Officer, said, “We are extremely proud of the execution by our team this quarter. Our results demonstrate the strong demand for Sientra’s industry-leading products backed by an unrivaled safety profile, strong relationships with Plastic Surgeons, and innovative programs. Looking forward, we see significant market opportunities and believe that the upcoming launch of our novel enhanced viability fat transfer system will be revolutionary, transforming Sientra into a full aesthetics company.”

Third Quarter 2022 Financial Results

  • Total net sales were $22.6 million, an increase of 15% compared to total net sales of $19.6 million for the same period in 2021
  • Gross profit for the third quarter of 2022 was $12.8 million, or 56.6% of sales, compared to gross profit of $10.6 million, or 54% of sales, for the same period in 2021
  • GAAP Operating expenses for the third quarter of 2022 of $25.3 million compared to $22.3 million for the same period in 2021. A driver to the increase was higher investment in R&D and commercial operations in anticipation of new product launches
  • Loss from continuing operations for the third quarter of 2022 was $14.9 million compared to net income of $28.5 million for the same period in 2021
  • Non-GAAP operating expenses for the third quarter of 2022 were $21.7 million compared to $19.2 million for the same period in 2021. The increase is attributed to investments in R&D and commercial operations in anticipation of new product launches
  • Net cash and cash equivalents as of September 30, 2022, were $19.0 million, compared to $51.8 million on December 31, 2021
  • Ending cash of $19.0 million with improvement of free cash flow usage of $3.6 million in Q3 2022 compared to a free cash flow usage of $15.4 million in the same period last year.

Conference Call
Sientra will hold a conference call today, November 10, 2022, at 4:30 pm ET to discuss second quarter 2022 results. The dial-in numbers are 1-866-374-5140 for domestic callers. The conference ID is 57765123#. The webcast link is the following: Sientra Q3 2022 Earnings Call Webcast Registration Link. A live webcast of the conference call will be available on the Investor Relations section of the Company's website at www.sientra.com. The webcast will be archived on the website following the call’s completion.

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 Santa Barbara, 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, the AuraGen fat grafting 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 third quarter ended September 31, 2022, the impact of the COVID-19 pandemic on the Company and its operations, the impact of current economic headwinds on the Company and its operation, 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 integrate the AuraGen fat grafting system into its existing operations, the reception of plastic surgeons to the Company’s products, including the AuraGen fat grafting system, \, the Company’s ability to expand into aesthetic applications outside of breast procedures, 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 scope and duration of the COVID-19 pandemic, the scope and duration of the current economic headwinds, the Company’s ability to recapture delayed procedures resulting from the COVID-19 pandemic, the positive reaction from plastic surgeons and their patients to Sientra’s Breast Products, including the AuraGen fat grafting system, , the ability to meet consumer demand, the growth of the plastic surgery market and breast procedures, regulatory timelines in the United States and abroad for approval of the Company’s products, 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  Nine Months Ended 
  September 30,  September 30, 
  2022  2021  2022  2021 
Net sales $22,570  $19,620  $65,481  $58,035 
Cost of goods sold  9,794   9,030   27,118   26,027 
Gross profit  12,776   10,590   38,363   32,008 
Operating expenses:            
Sales and marketing  12,290   12,052   41,542   34,348 
Research and development  3,720   2,367   9,823   6,962 
General and administrative  9,324   7,865   31,589   23,321 
Total operating expenses  25,334   22,284   82,954   64,631 
Loss from operations  (12,558)  (11,694)  (44,591)  (32,623)
Other (expense) income, net:            
Interest income  41   1   58   4 
Interest expense  (2,364)  (2,026)  (6,584)  (6,143)
Change in fair value of derivative liability     35,550      (14,460)
Other (expense) income, net  (6)  6,672   (1)  6,575 
Total other (expense) income, net  (2,329)  40,197   (6,527)  (14,024)
(Loss) income from continuing operations before income taxes  (14,887)  28,503   (51,118)  (46,647)
Income tax expense            
(Loss) Income from continuing operations  (14,887)  28,503   (51,118)  (46,647)
(Loss) Income from discontinued operations, net of income taxes  (94)  (93)  (208)  233 
Net (loss) income $(14,981) $28,410  $(51,326) $(46,414)
Basic (loss) earnings per share:            
Continuing operations $(0.24) $0.49  $(0.82) $(0.82)
Discontinued operations  (0.00)  0.00   (0.00)  0.00 
Basic (loss) earnings per share $(0.24) $0.49  $(0.82) $(0.82)
Diluted loss per share:            
Continuing operations $(0.24) $(0.08) $(0.82) $(0.82)
Discontinued operations  (0.00)  (0.00)  (0.00)  (0.00)
Diluted loss per share $(0.24) $(0.08) $(0.82) $(0.82)
Weighted average outstanding common shares used for net (loss) income per share attributable to common stockholders:            
Basic  62,848,172   58,005,784   62,613,501   56,680,594 
Diluted  62,848,172   72,639,930   62,613,501   56,680,594 


Sientra, Inc. 
Condensed Consolidated Balance Sheets 
(In thousands) 
(Unaudited) 
       
       
  September 30,  December 31, 
  2022  2021 
Assets      
Current assets:      
Cash and cash equivalents $18,975  $51,772 
Accounts receivable, net  34,360   33,105 
Inventories, net  51,640   52,914 
Prepaid expenses and other current assets  3,557   2,979 
Current assets of discontinued operations  4   4 
Total current assets  108,536   140,774 
Property and equipment, net  14,059   13,998 
Goodwill
Sientra, Inc.

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Surgical and Medical Instrument Manufacturing
Manufacturing
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United States
Santa Barbara