PRESS RELEASE
Obalon Announces Fourth Quarter and Full Year 2019 Financial Results
“2019 was an eventful year for Obalon as we recapitalized and repositioned the business to efficiently leverage our FDA-approved weight loss system through our new retail treatment center business model,” said
Key Accomplishments in 2019:
- Opened the first Obalon-managed retail treatment center in
San Diego - Commercialized Obalon Navigation System and Obalon Touch Inflation Dispenser
- Streamlined operations and spend to support new commercial strategy
- Repaid all outstanding long-term debt
- Promoted
Bill Plovanic from Chief Financial Officer to President and Chief Executive Officer - Appointed
Bob MacDonald as Chief Retail Officer to establish and grow our network ofObalon Centers for Weight Loss facilities - Promoted
Nooshin Hussainy from Vice President of Finance to Chief Financial Officer - Engaged
Helmuth T. Billy , MD as Medical Director for Company-managedCalifornia retail treatment centers - Entered into one-year distribution agreement with distributor for
Qatar - Announced clinical data presentation at ASMBS annual meeting at Obesity Week 2019 demonstrating clinically meaningful weight loss for patients treated with the Obalon Balloon System with no serious adverse events reported
Fourth Quarter 2019 Results:
The Company reported revenue of
Cost of revenue was
Research and development expense for the fourth quarter of 2019 totaled
Operating loss for the fourth quarter of 2019 was
Net loss in the fourth quarter of 2019 was
As of
Full Year 2019 Results:
Obalon reported full year 2019 revenue of
Gross profit for the full year 2019 was
Research and development expense totaled
Operating loss for the full year 2019 was
Net loss was reported at
Call Information
A conference call to discuss fourth quarter and full year 2019 financial results is scheduled for today,
An archive of the webcast will be available for twelve months following the event on the
Cautionary Statement Regarding Forward Looking Statements
This press release contains forward-looking statements that are not purely historical regarding Obalon’s or its management’s intentions, beliefs, expectations and strategies for the future, including those related to new products and their potential benefits. All forward-looking statements and reasons why results might differ included in this press release are made as of the date of this release, based on information currently available to Obalon, deal with future events, are subject to various risks and uncertainties, and actual results could differ materially from those anticipated in those forward looking statements. The risks and uncertainties that may cause actual results to differ materially from Obalon’s current expectations are more fully described in Obalon’s annual report on Form 10-K for the period ended
About
For
Investor Contact:
William Plovanic
President & Chief Executive Officer
Office: +1 760 607 5103
wplovanic@obalon.com
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||||||||||||
(in thousands, except shares and per share data) | |||||||||||||||
Three Months Ended |
Year Ended |
||||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||||
(Unaudited) |
|||||||||||||||
Revenue | $ | 787 | $ | 2,036 | $ | 3,281 | $ | 9,101 | |||||||
Cost of revenue | 627 | 1,504 | 2,950 | 5,423 | |||||||||||
Gross profit | 160 | 532 | 331 | 3,678 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 1,492 | 2,338 | 6,893 | 10,697 | |||||||||||
Selling, general and administrative | 3,643 | 6,854 | 16,668 | 29,946 | |||||||||||
Total operating expenses | 5,135 | 9,192 | 23,561 | 40,643 | |||||||||||
Loss from operations | (4,975 | ) | (8,660 | ) | (23,230 | ) | (36,965 | ) | |||||||
Interest income (expense), net | 63 | (62 | ) | (385 | ) | (226 | ) | ||||||||
Other expense | (1 | ) | (34 | ) | (61 | ) | (189 | ) | |||||||
Net loss | (4,913 | ) | (8,756 | ) | (23,676 | ) | (37,380 | ) | |||||||
Other comprehensive income | — | 2 | — | 5 | |||||||||||
Net loss and comprehensive loss | $ | (4,913 | ) | $ | (8,754 | ) | $ | (23,676 | ) | $ | (37,375 | ) | |||
Net loss per share, basic and diluted | $ | (0.64 | ) | $ | (3.87 | ) | $ | (5.03 | ) | $ | (19.64 | ) | |||
Weighted-average common shares outstanding, basic and diluted | 7,692,673 | 2,259,645 | 4,706,775 | 1,903,734 | |||||||||||
CONSOLIDATED BALANCE SHEETS | |||||||
(in thousands, except shares and par value data) | |||||||
2019 | 2018 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 14,055 | $ | 21,187 | |||
Short-term investments | — | 2,548 | |||||
Accounts receivable, net | 285 | 870 | |||||
Inventory | 1,936 | 1,580 | |||||
Other current assets | 1,959 | 2,462 | |||||
Total current assets | 18,235 | 28,647 | |||||
Lease right-of-use assets | 1,077 | — | |||||
Property and equipment, net | 1,081 | 1,739 | |||||
Total assets | $ | 20,393 | $ | 30,386 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 648 | $ | 1,159 | |||
Accrued compensation | 820 | 3,805 | |||||
Deferred revenue | 424 | 352 | |||||
Other current liabilities | 1,524 | 1,985 | |||||
Current portion of lease liabilities | 561 | — | |||||
Current portion of long-term loan | — | 9,930 | |||||
Total current liabilities | 3,977 | 17,231 | |||||
Lease liabilities long term | 567 | — | |||||
Other long-term liabilities | — | 48 | |||||
Total liabilities | 4,544 | 17,279 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Common stock, |
8 | 2 | |||||
Additional paid-in capital | 188,271 | 161,859 | |||||
Accumulated deficit | (172,430 | ) | (148,754 | ) | |||
Total stockholders’ equity | 15,849 | 13,107 | |||||
Total liabilities and stockholders’ equity | $ | 20,393 | $ | 30,386 | |||
CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(in thousands) | |||||||
Year Ended |
|||||||
2019 | 2018 | ||||||
Operating activities: | |||||||
Net loss | $ | (23,676 | ) | $ | (37,380 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation | 479 | 581 | |||||
Stock-based compensation | 2,983 | 4,693 | |||||
Amortization of right-of-use asset | 415 | — | |||||
Loss on disposal of fixed assets | 128 | 107 | |||||
Accretion of investment discount, net | (2 | ) | (50 | ) | |||
Amortization of debt discount | 70 | 37 | |||||
Change in operating assets and liabilities: | |||||||
Accounts receivable, net | 585 | 3,353 | |||||
Inventory | 12 | (162 | ) | ||||
Other current assets | 411 | 98 | |||||
Accounts payable | (543 | ) | 70 | ||||
Accrued compensation | (2,985 | ) | (689 | ) | |||
Deferred revenue | 72 | (158 | ) | ||||
Lease liabilities, net | (364 | ) | — | ||||
Other current and long term liabilities | (451 | ) | 68 | ||||
Net cash used in operating activities | (22,866 | ) | (29,432 | ) | |||
Investing activities: | |||||||
Purchases of short-term investments | — | (9,102 | ) | ||||
Maturities of short-term investments | 2,550 | 29,901 | |||||
Purchases of property and equipment | (194 | ) | (1,282 | ) | |||
Net cash provided by investing activities | 2,323 | 19,517 | |||||
Financing activities: | |||||||
Proceeds from issuance of common stock and warrants, net of issuance costs | 23,377 | 9,823 | |||||
Proceeds from long-term loan, net of issuance costs | 10,000 | — | |||||
Fees paid in connection with loan amendment | — | (30 | ) | ||||
Repayments of long-term loans | (20,000 | ) | — | ||||
Proceeds from common stock issued under employee stock purchase plan | — | 148 | |||||
Proceeds from sale of common stock upon exercise of stock options | 1 | 53 | |||||
Net cash provided by financing activities | 13,378 | 9,994 | |||||
Net (decrease) increase in cash and cash equivalents | (7,132 | ) | 79 | ||||
Cash and cash equivalents at beginning of period | 21,187 | 21,108 | |||||
Cash and cash equivalents at end of period | $ | 14,055 | $ | 21,187 | |||
Supplemental cash flow information: | |||||||
Interest paid | $ | 719 | $ | 642 | |||
Income taxes paid | $ | — | $ | 7 | |||
Property and equipment in accounts payable | $ | 32 | $ | 201 | |||
Unpaid issuance costs | $ | — | $ | 250 | |||
Fair value of commitment shares issued | $ | — | $ | 595 | |||
Source: Obalon Therapeutics, Inc.