CHF Solutions, Inc. Announces 49.5 Percent Increase in Revenue for Fourth Quarter 2020 and Provides Company Update
Recent Highlights
- Revenue for the fourth quarter of 2020 was
$2 million , an increase of 49.5% compared to the prior year period - Gross margin was 56.1% for the fourth quarter 2020, up from 50.8% in the corresponding period in 2019 and up from 46.1% in the third quarter of 2020
- Critical Care revenue benefited in the quarter from increased utilization from hospitals treating COVID-19 patients with the Aquadex System.
- Continued to see strong momentum in pediatric accounts, adding 5 new locations including Children’s Hospitals in
Philadelphia ,Houston , and theSan Francisco Bay Area - Presented a 355 consecutive patient retrospective study at the Annual Scientific Meeting of
Heart Failure Society of America , which showed substantial mean fluid removal with no negative changes in renal function and reduced rehospitalization rates in patients treated with Aquadex therapy - Successfully submitted CPT code application for ultrafiltration using Aquadex SmartFlow, which will provide access to heart failure patients in the outpatient setting
- Cash and cash equivalents totaled
$14.4 million with no debt as ofDecember 31, 2020
“CHF Solutions built on its momentum over the last few quarters, having delivered solid fourth quarter results, most notably within critical care and pediatric accounts,” said
Fourth Quarter 2020 Financial Results
Revenue for the fourth quarter was
Gross margin was 56.1% for the fourth quarter 2020, up from 50.8% in the corresponding period in 2019 and up from 46.1% in the third quarter of 2020. Gross margins for the quarter were favorably impacted by increased consumables volume and improved manufacturing efficiencies.
Operating expenses for the fourth quarter of 2020 were
The Company recognized a gain of
The Company used
Webcast and Conference Call Information
The Company will host a conference call and webcast at
About
About the Aquadex SmartFlow System
The Aquadex SmartFlow system delivers clinically proven therapy using a simple, flexible and smart method of removing excess fluid from patients suffering from hypervolemia (fluid overload). The Aquadex SmartFlow system is indicated for temporary (up to 8 hours) or extended (longer than 8 hours in patients who require hospitalization) use in adult and pediatric patients weighing 20 kg or more whose fluid overload is unresponsive to medical management, including diuretics. All treatments must be administered by a health care provider, within an outpatient or inpatient clinical setting, under physician prescription, both having received training in extracorporeal therapies.
Forward-Looking Statements
Certain statements in this release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including without limitation, statements regarding the value that the company brings to its customers. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Many factors could cause actual future events to differ materially from the forward-looking statements in this release, including, without limitation, those risk associated with our ability to execute on our commercialization strategy, the impact of the COVID-19 pandemic, the possibility that we may be unable to raise sufficient funds necessary for our anticipated operations, our post-market clinical data collection activities, benefits of our products to patients, our expectations with respect to product development and commercialization efforts, our ability to increase market and physician acceptance of our products, potentially competitive product offerings, intellectual property protection, our ability to integrate acquired businesses, our expectations regarding anticipated synergies with and benefits from acquired businesses, and other risks and uncertainties described in our filings with the SEC. Forward-looking statements speak only as of the date when made.
Financials
Condensed Consolidated Statements of Operations and Comprehensive Loss
(In thousands, except per share amounts)
| Three months ended |
Twelve months ended |
|||||||||||||||||
| 2020 | 2019 | 2020 | 2019 | |||||||||||||||
| Net sales | $ | 2,044 | $ | 1,367 | $ | 7,441 | $ | 5,511 | ||||||||||
| Costs and expenses: | ||||||||||||||||||
| Cost of goods sold | 897 | 673 | 3,384 | 2,660 | ||||||||||||||
| Selling, general and administrative | 4,384 | 4,187 | 17,417 | 16,285 | ||||||||||||||
| Research and development | 1,047 | 953 | 3,668 | 4,672 | ||||||||||||||
| Total costs and expenses | 6,328 | 5,813 | 24,469 | 23,617 | ||||||||||||||
| Loss from operations | (4,284 | ) | (4,446 | ) | (17,028 | ) | (18,106 | ) | ||||||||||
| Realized foreign currency translation gain from dissolution of subsidiary | 1,202 | - | 1,202 | - | ||||||||||||||
| Other income (expense), net | (2 | ) | 1 | (1 | ) | - | ||||||||||||
| Loss before income taxes | (3,084 | ) | (4,445 | ) | (15,827 | ) | (18,106 | ) | ||||||||||
| Income tax expense | (2 | ) | (3 | ) | (9 | ) | (8 | ) | ||||||||||
| Net loss | $ | (3,086 | ) | $ | (4,448 | ) | $ | (15,836 | ) | $ | (18,114 | ) | ||||||
| Basic and diluted loss per share | $ | (1.13 | ) | $ | (33.46 | ) | $ | (10.67 | ) | $ | (278.90 | ) | ||||||
| Weighted average shares outstanding – basic and diluted | 2,736 | 133 | 1,649 | 81 | ||||||||||||||
| Other comprehensive loss: | ||||||||||||||||||
| Realized foreign currency translation gain from dissolution of subsidiary | $ | (1,202 | ) | $ | - | $ | (1,202 | ) | $ | - | ||||||||
| Unrealized foreign currency translation adjustments | $ | (12 | ) | $ | (5 | ) | $ | (19 | ) | $ | (9 | ) | ||||||
| Total comprehensive loss | $ | (4,300 | ) | $ | (4,453 | ) | $ | (17,057 | ) | $ | (18,123 | ) | ||||||
CHF SOLUTIONS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(In thousands, except share and per share amounts)
2020 |
2019 |
|||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 14,437 | $ | 1,279 | ||||
| Accounts receivable | 905 | 799 | ||||||
| Inventories | 2,957 | 1,797 | ||||||
| Other current assets | 237 | 161 | ||||||
| Total current assets | 18,536 | 4,036 | ||||||
| Property, plant and equipment, net | 1,200 | 991 | ||||||
| Operating lease right-of-use asset, net | 255 | 442 | ||||||
| Other assets | 21 | 133 | ||||||
| TOTAL ASSETS | $ | 20,012 | $ | 5,602 | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable | $ | 1,097 | $ | 1,488 | ||||
| Accrued compensation | 2,192 | 1,592 | ||||||
| Current portion of operating lease liability | 206 | 186 | ||||||
| Current portion of finance lease liability | 24 | - | ||||||
| Other current liabilities | 66 | 85 | ||||||
| Total current liabilities | 3,585 | 3,351 | ||||||
| Operating lease liability | 55 | 261 | ||||||
| Finance lease liability | 54 | - | ||||||
| Total liabilities | 3,694 | 3,612 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity | ||||||||
| Series A junior participating preferred stock as of |
— | — | ||||||
| Series F convertible preferred stock as of |
— | — | ||||||
| Preferred stock as of |
— | — | ||||||
| Common stock as of |
— | — | ||||||
| Additional paid-in capital | 249,663 | 218,278 | ||||||
| Accumulated other comprehensive income: | ||||||||
| Foreign currency translation adjustment | (7 | ) | 1,214 | |||||
| Accumulated deficit | (233,338 | ) | (217,502 | ) | ||||
| Total stockholders’ equity | 16,318 | 1,990 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 20,012 | $ | 5,602 | ||||
CHF SOLUTIONS, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(In thousands)
| For the years ended |
|||||||||
| 2020 | 2019 | ||||||||
| Operating Activities | |||||||||
| Net loss | $ | (15,836 | ) | $ | (18,114 | ) | |||
| Adjustments to reconcile net loss to cash flows from operating activities: | |||||||||
| Depreciation and amortization | 376 | 239 | |||||||
| Stock-based compensation expense | 1,349 | 1,512 | |||||||
| Loss on disposal of property and equipment | 40 | — | |||||||
| Realized foreign currency translation gain from dissolution of subsidiary | (1,202) | — | |||||||
| Changes in operating assets and liabilities: | |||||||||
| Accounts receivable | (106 | ) | (13 | ) | |||||
| Inventories | (1,420 | ) | (343 | ) | |||||
| Other current assets | (76 | ) | 42 | ||||||
| Other assets and liabilities | 112 | 18 | |||||||
| Accounts payable and accrued compensation | 191 | 292 | |||||||
| Net cash used in operations | (16,572 | ) | (16,367 | ) | |||||
| Investing activities: | |||||||||
| Purchase of property and equipment | (298 | ) | (490 | ) | |||||
| Proceeds from the sale of property and equipment | 31 | — | |||||||
| Net cash used in investing activities | (267 | ) | (490 | ) | |||||
| Financing activities: | |||||||||
| Proceeds from public stock offerings, net | 25,921 | 12,665 | |||||||
| Proceeds from warrant exercises | 4,115 | — | |||||||
| Payments on finance lease liability | (20 | ) | — | ||||||
| Net cash provided by financing activities | 30,016 | 12,665 | |||||||
| Effect of exchange rate changes on cash | (19 | ) | (9 | ) | |||||
| Net increase (decrease) in cash and cash equivalents | 13,158 | (4,201 | ) | ||||||
| Cash and cash equivalents—beginning of year | 1,279 | 5,480 | |||||||
| Cash and cash equivalents—end of year | $ | 14,437 | $ | 1,279 | |||||
| Supplemental schedule of non-cash activities | |||||||||
| Financing fees incurred for subsequent equity financing included in other assets and accounts payable | $ | — | $ | 111 | |||||
| Inventory transferred to property, plant and equipment | $ | 260 | $ | 204 | |||||
| Equipment acquired through finance lease liability | $ | 98 | $ | — | |||||
| Supplemental cash flow information | |||||||||
| Cash paid for income taxes | $ | 10 | $ | 4 | |||||
CONTACTS: INVESTORS:Claudia Napal Drayton Chief Financial OfficerCHF Solutions, Inc. 952-345-4205 ir@chf-solutions.comMatt Bacso , CFAGilmartin Group LLC Matt.bacso@gilmartinir.com MEDIA:Jessica Stebing Health+Commerce 260-336-6202 jstebing@healthandcommerce.com
Source: CHF Solutions, Inc.
