Uroplasty Reports Fiscal Fourth Quarter and Full Year Results
~ Global Urgent PC Revenue Up 34% in Q4
~~ Total Revenue Up 15% in Q4
MINNEAPOLIS, May 15, 2014 /PRNewswire/ -- Uroplasty, Inc. (NASDAQ: UPI), a medical device company that develops, manufactures and markets innovative proprietary products to treat voiding dysfunctions, today reported financial results for the fiscal 2014 fourth quarter and full year ended March 31, 2014.
Global revenue from the Company's Urgent® PC Neuromodulation System grew 34% to $4.1 million, as compared to $3.1 million in the fourth quarter of the prior year. Sales of Urgent PC in the U.S. were up 27% in the fourth quarter while sales of Urgent PC in international markets were up 74%.
Total global revenue for the fiscal fourth quarter 2014 was $6.4 million, up 15% from the same quarter in the prior year. Total domestic net revenue grew 13% to $4.5 million, as compared with $4.0 million during the year ago period while net international revenue grew 20% to $1.8 million, as compared with $1.5 million the fiscal fourth quarter of the prior fiscal quarter.
"Urgent PC continues to gain traction in both the U.S. and international markets, which led to the first quarter ever with revenue in excess of $4.0 million for this product line," said Rob Kill, President and Chief Executive Officer of Uroplasty. "While our execution improved throughout the year, we still have work to do in order to maximize our opportunities. We will continue to invest in sales and marketing to support continued growth in Urgent PC. Additionally, we will invest in R&D initiatives to expand our product offerings. We are excited about the potential of Urgent PC to treat fecal incontinence, and based on the encouraging early results in our pilot study, we expect to begin enrollment later this fiscal year for a pivotal trial on the use of Urgent PC to treat this debilitating condition impacting nearly 30 million Americans."
The Company generated a gross margin of 87.7% in the fiscal fourth quarter compared with 86.5% in the same quarter a year ago. Operating expenses for the period totaled $6.7 million compared to $5.8 million in the same quarter last year and were up $0.4 million as compared to the fiscal third quarter of 2014. The increased operating expenses resulted from the expansion and full staffing of the sales team.
The operating loss of $1.1 million in the fiscal fourth quarter compares with a $1.0 million operating loss in the same quarter last year. Excluding non-cash charges for share-based compensation and depreciation and amortization expense, the non-GAAP operating loss was $0.8 million in the fourth quarter of fiscal 2014, compared with a $0.5 million non-GAAP operating loss in the fourth quarter a year ago.
For the year ended March 31, 2014, total revenue grew 10% to $24.6 million, reflecting a 10% increase in U.S. revenue and a 9% increase in international revenue. Revenue from Urgent PC increased 17% to $12.3 million in the United States and increased 29% to $2.7 million in international markets. At March 31, 2014, cash, cash equivalents and cash investments totaled $12.1 million.
Reimbursement Update
Three new payers have recently written positive coverage policies for Percutaneous Tibial Nerve Stimulation (PTNS) delivered via Urgent PC for treatment of overactive bladder (OAB) and associated symptoms of urinary urgency, urinary frequency and urge incontinence.
Blue Cross Blue Shield of Michigan, Premera Blue Cross and UPMC Health Plan each now have positive coverage policies for PTNS. Blue Cross Blue Shield of Michigan is the largest provider in the state of Michigan and covers 5.6 million members. Premera Blue Cross provides coverage in Washington and Alaska and covers 1.6 million members. UPMC Health Plan is a leading network in Western Pennsylvania and the surrounding area and covers 2.2 million members.
"These positive coverage decisions continue to demonstrate the growing appreciation for the clinical benefits and cost effectiveness of Urgent PC in treating patients with OAB," said Dan Merz, Vice President of Healthcare Affairs. "We now have approximately 119 million lives covered by private payers and over 40 million Medicare beneficiaries with access to Urgent PC therapy."
Fiscal 2015 Expectations
Management expects total revenue growth in Fiscal 2015 to range from 9% to 12%, or revenue of $26.8 million to $27.6 million. Total Urgent PC revenue is expected to grow approximately 15% in fiscal 2015 while total Macroplastique revenue is expected to be similar to fiscal 2014.
Excluding non-cash charges for share-based compensation and depreciation and amortization expense, the fiscal 2015 non-GAAP operating loss is projected to range from $3 million to $4 million. This guidance assumes ongoing base business investments in the U.S. sales force and marketing programs, research and development, as well as clinical initiatives.
Conference Call
Uroplasty will host a conference call and webcast today at 4:30 p.m. Eastern Time (3:30 p.m. Central Time) to discuss these results. Rob Kill, President and Chief Executive Officer, and Brett Reynolds, Chief Financial Officer, will host the call. Individuals wishing to participate in the conference call should dial 877-941-8609. No passcode is necessary. To access a live webcast of the call, go to Uroplasty's website at www.uroplasty.com and click on the Investor Relations section.
An audio replay will be available for 30 days following the call at 800-406-7325 with the passcode 4682013#. An archived webcast will also be available at investor.uroplasty.com.
About Uroplasty, Inc.
Uroplasty, Inc., headquartered in Minnetonka, Minnesota, with wholly-owned subsidiaries in The Netherlands and the United Kingdom, is a global medical company committed to offering transformative treatment options to specialty physicians. Our products are designed to help providers change the lives of their voiding dysfunction patients and strengthen the efficiency of their practices. Our focus is the continued commercialization of our Urgent® PC Neuromodulation System, the only commercially available FDA-cleared system that delivers percutaneous tibial nerve stimulation (PTNS) for the office-based treatment of overactive bladder and associated symptoms of urgency, frequency and urge incontinence. We also offer Macroplastique®, an injectable urethral bulking agent for the treatment of adult female stress urinary incontinence primarily due to intrinsic sphincter deficiency. For more information on the company and its products, please visit Uroplasty, Inc. at www.uroplasty.com.
Forward-Looking Information
This press release contains forward-looking statements that reflect our best estimates regarding future events and financial performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our anticipated results. We discuss in detail the factors that may affect the achievement of our forward-looking statements in our Annual Report on Form 10-K filed with the SEC. In particular, we cannot be certain that we will ever achieve sustained profitability, that the rate of reimbursement for PTNS treatments will be adequate to justify the cost of our product, that other Medicare carriers or private payers will provide coverage for this treatment or that existing carriers and payers will not change their coverage decisions, that the rate of adoption of our products by new customers will continue, or that any of the other risks identified in our 10-K will not adversely affect our expectations as described in these forward-looking statements.
For Further Information:
Uroplasty, Inc.
Brett Reynolds, SVP and CFO
952.426.6152
EVC Group
Leigh Salvo (Investors)
415.568.9348 or
Doug Sherk
415.652.9100
Janine McCargo (Media)
646.688.0425
| UROPLASTY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) |
|||||||
| Three Months Ended |
Year Ended |
||||||
| March 31 |
March 31 |
||||||
| 2014 |
2013 |
2014 |
2013 |
||||
| Net sales |
$6,360,735 |
$5,540,586 |
$24,577,126 |
$22,417,980 |
|||
| Cost of goods sold |
781,655 |
750,165 |
3,049,811 |
3,014,886 |
|||
| Gross profit |
5,579,080 |
4,790,421 |
21,527,315 |
19,403,094 |
|||
| Operating expenses |
|||||||
| General and administrative |
1,356,133 |
1,009,580 |
6,522,388 |
4,187,819 |
|||
| Research and development |
716,610 |
719,282 |
2,151,257 |
2,415,123 |
|||
| Selling and marketing |
4,625,140 |
3,814,194 |
18,121,732 |
15,238,600 |
|||
| Amortization |
8,115 |
215,862 |
30,462 |
862,833 |
|||
| 6,705,998 |
5,758,918 |
26,825,839 |
22,704,375 |
||||
| Operating loss |
(1,126,918) |
(968,497) |
(5,298,524) |
(3,301,281) |
|||
| Other income (expense) |
|||||||
| Interest income |
3,520 |
10,203 |
22,095 |
46,039 |
|||
| Interest expense |
- |
(695) |
- |
(707) |
|||
| Foreign currency exchange gain (loss) |
(222) |
5,005 |
(4,762) |
1,573 |
|||
| 3,298 |
14,513 |
17,333 |
46,905 |
||||
| Loss before income taxes |
(1,123,620) |
(953,984) |
(5,281,191) |
(3,254,376) |
|||
| Income tax expense |
21,866 |
14,958 |
71,899 |
50,770 |
|||
| Net loss |
$(1,145,486) |
$(968,942) |
$(5,353,090) |
$(3,305,146) |
|||
| Basic and diluted net loss per common |
$(0.05) |
$(0.05) |
$(0.25) |
$(0.16) |
|||
| Weighted average common shares |
|||||||
| Basic and diluted |
21,366,881 |
20,803,530 |
21,118,258 |
20,777,238 |
|||
| UROPLASTY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) |
|||
| March 31, 2014 |
March 31, 2013 |
||
| Assets |
|||
| Current assets: |
|||
| Cash and cash equivalents |
$8,681,609 |
$3,533,864 |
|
| Short-term investments |
3,451,086 |
7,936,605 |
|
| Accounts receivable, net |
2,875,275 |
2,553,447 |
|
| Inventories |
517,217 |
718,933 |
|
| Other |
507,299 |
566,536 |
|
| Total current assets |
16,032,486 |
15,309,385 |
|
| Property, plant and equipment, net |
997,609 |
1,033,085 |
|
| Intangible assets, net |
119,980 |
100,502 |
|
| Long-term investments |
- |
3,451,711 |
|
| Deferred tax assets |
150,971 |
146,052 |
|
| Total assets |
$17,301,046 |
$20,040,735 |
|
| Liabilities and Shareholders' Equity |
|||
| Current liabilities: |
|||
| Accounts payable |
$904,879 |
$618,916 |
|
| Current portion – deferred rent |
2,917 |
35,000 |
|
| Income tax payable |
21,922 |
7,729 |
|
| Accrued liabilities: |
|||
| Compensation |
1,999,966 |
1,550,846 |
|
| Other |
479,373 |
476,287 |
|
| Total current liabilities |
3,409,057 |
2,688,778 |
|
| Deferred rent – less current portion |
171 |
5,141 |
|
| Accrued pension liability |
678,118 |
660,580 |
|
| Total liabilities |
4,087,346 |
3,354,499 |
|
| Total shareholders' equity |
13,213,700 |
16,686,236 |
|
| Total liabilities and shareholders' equity |
$17,301,046 |
$20,040,735 |
|
| UROPLASTY, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) |
|||
| Year Ended |
|||
| March 31 |
|||
| 2014 |
2013 |
||
| Cash flows from operating activities: |
|||
| Net loss |
$(5,353,090) |
$(3,305,146) |
|
| Adjustments to reconcile net loss to net cash used in operating |
|||
| Depreciation and amortization |
353,238 |
1,152,929 |
|
| (Gain) loss on disposal of equipment |
(2,872) |
7,617 |
|
| Amortization of premium on marketable securities |
8,341 |
47,559 |
|
| Share-based consulting expense |
- |
1,623 |
|
| Share-based compensation expense |
1,436,270 |
810,016 |
|
| Deferred income tax expense |
6,498 |
(29,053) |
|
| Deferred rent |
(37,053) |
(36,902) |
|
| Changes in operating assets and liabilities: |
|||
| Accounts receivable, net |
(257,794) |
108,495 |
|
| Inventories |
207,050 |
(25,370) |
|
| Other current assets |
63,899 |
(205,778) |
|
| Accounts payable |
281,104 |
30,925 |
|
| Accrued compensation |
436,765 |
(25,301) |
|
| Accrued liabilities, other |
6,472 |
164,176 |
|
| Accrued pension liability, net |
(51,000) |
79,598 |
|
| Net cash used in operating activities |
(2,902,172) |
(1,224,612) |
|
| Cash flows from investing activities: |
|||
| Proceeds from maturity of available-for-sale investments |
7,930,000 |
4,200,000 |
|
| Proceeds from maturity of held-to-maturity investments |
- |
6,920,000 |
|
| Purchases of available-for-sale marketable investments |
- |
(8,425,034) |
|
| Purchases of held-to-maturity marketable investments |
- |
(2,500,000) |
|
| Purchases of property, plant and equipment |
(248,105) |
(189,929) |
|
| Proceeds from sale of property, plant and equipment |
6,773 |
5,591 |
|
| Payments for intangible assets |
(49,940) |
(17,455) |
|
| Net cash provided by (used in) investing activities |
7,638,728 |
(6,827) |
|
| Cash flows from financing activities: |
|||
| Proceeds from exercise of options |
359,502 |
150,000 |
|
| Net cash provided by financing activities |
359,502 |
150,000 |
|
| Effect of exchange rate changes on cash and cash equivalents |
51,687 |
(37,923) |
|
| Net increase in cash and cash equivalents |
5,147,745 |
(1,119,362) |
|
| Cash and cash equivalents at beginning of period |
3,533,864 |
4,653,226 |
|
| Cash and cash equivalents at end of period |
$8,681,609 |
$3,533,864 |
|
Non-GAAP Financial Measures: The following table reconciles our operating loss calculated in accordance with accounting principles generally accepted in the U.S. (GAAP) to non-GAAP financial measures that exclude non-cash charges for share-based compensation, depreciation and amortization from gross profit, operating expenses and operating loss. The non-GAAP financial measures used by management and disclosed by us are not a substitute for, nor superior to, financial measures and consolidated financial results calculated in accordance with GAAP, and you should carefully evaluate our reconciliations to non-GAAP. We may calculate our non-GAAP financial measures differently from similarly titled measures used by other companies. Therefore, our non-GAAP financial measures may not be comparable to those used by other companies. We have described the reconciliations of each of our non-GAAP financial measures described above to the most directly comparable GAAP financial measures.
We use these non-GAAP financial measures, and in particular non-GAAP operating loss, for internal managerial purposes because we believe such measures are important indicators of the strength and the operating performance of our business. Analysts and investors frequently ask us for this information. We believe that they use these measures to evaluate the overall operating performance of companies in our industry, including as a means of comparing period-to-period results and as a means of evaluating our results with those of other companies.
Our non-GAAP operating loss for the three months ended March 31, 2014 and 2013 was approximately $814,000 and $477,000, respectively. Our non-GAAP operating loss for fiscal 2014 and 2013 was approximately $3,510,000 and $1,336,000, respectively. The fiscal 2014 increase in non-GAAP operating loss is attributed to the increase in operating spending (including $1.4 million of cash costs related to our review of internal control over financial reporting and executive management changes), offset partially by the increase in net sales and gross profit percent.
| Expense Adjustments |
|||||
| Three-Months Ended |
GAAP |
Share-based |
Depreciation |
Amortization |
Non-GAAP |
| March 31, 2014 |
|||||
| Gross profit |
$5,579,000 |
$6,000 |
$7,000 |
$- |
$5,592,000 |
| % of net sales |
87.7% |
87.9% |
|||
| Operating expenses |
|||||
| General and administrative |
1,356,000 |
(166,000) |
(47,000) |
- |
1,143,000 |
| Research and development |
717,000 |
(15,000) |
(1,000) |
- |
701,000 |
| Selling and marketing |
4,625,000 |
(39,000) |
(24,000) |
- |
4,562,000 |
| Amortization |
8,000 |
- |
- |
(8,000) |
- |
| 6,706,000 |
(220,000) |
(72,000) |
(8,000) |
6,406,000 |
|
| Operating loss |
$(1,127,000) |
$226,000 |
$79,000 |
$8,000 |
$(814,000) |
| March 31, 2013 |
|||||
| Gross profit |
$4,790,000 |
$8,000 |
$8,000 |
$- |
$4,806,000 |
| % of net sales |
86.5% |
86.8% |
|||
| Operating expenses |
|||||
| General and administrative |
1,009,000 |
(133,000) |
(50,000) |
- |
826,000 |
| Research and development |
719,000 |
(14,000) |
(1,000) |
- |
704,000 |
| Selling and marketing |
3,814,000 |
(47,000) |
(14,000) |
- |
3,753,000 |
| Amortization |
216,000 |
- |
- |
(216,000) |
- |
| 5,758,000 |
(194,000) |
(65,000) |
(216,000) |
5,283,000 |
|
| Operating loss |
$(968,000) |
$202,000 |
$73,000 |
$216,000 |
$(477,000) |
| Expense Adjustments |
|||||
| Year Ended |
GAAP |
Share-based |
Depreciation |
Amortization |
Non-GAAP |
| March 31, 2014 |
|||||
| Gross profit |
$21,527,000 |
$27,000 |
$33,000 |
$- |
$21,587,000 |
| % of net sales |
87.6% |
87.8% |
|||
| Operating expenses |
|||||
| General and administrative |
6,522,000 |
(1,117,000) |
(200,000) |
- |
5,205,000 |
| Research and development |
2,151,000 |
(51,000) |
(4,000) |
- |
2,096,000 |
| Selling and marketing |
18,123,000 |
(241,000) |
(86,000) |
- |
17,796,000 |
| Amortization |
30,000 |
- |
- |
(30,000) |
- |
| 26,826,000 |
(1,409,000) |
(290,000) |
(30,000) |
25,097,000 |
|
| Operating loss |
$(5,299,000) |
$1,436,000 |
$323,000 |
$30,000 |
$(3,510,000) |
| March 31, 2013 |
|||||
| Gross profit |
$19,403,000 |
$31,000 |
$34,000 |
$- |
$19,468,000 |
| % of net sales |
86.6% |
86.8% |
|||
| Operating expenses |
|||||
| General and administrative |
4,188,000 |
(473,000) |
(196,000) |
- |
3,519,000 |
| Research and development |
2,415,000 |
(54,000) |
(3,000) |
- |
2,358,000 |
| Selling and marketing |
15,238,000 |
(254,000) |
(57,000) |
- |
14,927,000 |
| Amortization |
863,000 |
- |
- |
(863,000) |
- |
| 22,704,000 |
(781,000) |
(256,000) |
(863,000) |
20,804,000 |
|
| Operating loss |
$(3,301,000) |
$812,000 |
$290,000 |
$863,000 |
$(1,336,000) |
SOURCE Uroplasty, Inc.
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