Nuwellis, Inc. Announces Fourth Quarter and Full Year 2021 Financial Results
March 01 2022 - 7:00AM
Nuwellis, Inc. (Nasdaq: NUWE) announced today its results for the
fourth quarter and full year ended December 31, 2021, which
included the following highlights:
- Generated $1.6 million in total revenue for the fourth quarter
2021, 19.6% below the prior-year period and a 20% increase above
the comparable pre-pandemic period in 2019.
- Generated $7.9 million in total revenue for the fiscal year
2021, representing 6.5% growth compared to the prior-year period
and a 44% increase above the comparable pre-pandemic period in
2019
- Announced the commencement of the REVERSE-HF randomized
controlled multi-center trial designed to validate Aquadex therapy
as a first-line treatment option for re-hospitalized heart failure
patients
- Received a Category III CPT Code effective January 1, 2022
specifically for the use of therapeutic ultrafiltration, thereby
increasing reimbursement to professionals and facilities, an
important step in advancing Aquadex to standard of care
- Ended 2021 with approximately $24.2 million in cash and no
debt
“We are encouraged by our progress executing our strategy
throughout 2021. Our organization and its employees continued to
show adaptability and resilience amid changing market conditions
and customer requirements, and we ultimately succeeded in helping
more patients benefit from our therapy during the year.” said
Nestor Jaramillo, CEO of Nuwellis. “We anticipate that when this
most recent Omicron variant wave dissipates, we will see
accelerating sales growth by continuing to position ourselves as
the primary provider of ultrafiltration therapy for treating
patients suffering from fluid overload that are refractory to
diuretics.”
Fourth Quarter 2021 Financial Results
Revenue for the fourth quarter of 2021 was $1.6 million,
compared to $2.0 million the prior year period. The decrease was
primarily due to lower U.S. product sales, which was affected by
order timing, hospital budgetary constraints, and a reduction in
elective procedures due to COVID headwinds. When comparing fourth
quarter of 2021 to the pre-pandemic fourth quarter of 2019, U.S.
product revenue increased 20%.
In the fourth quarter of 2021, Pediatrics posted positive
sequential growth due to increased patient census in numerous
accounts following an uncharacteristically low third quarter. Heart
Failure was also modestly up sequentially, while Critical Care was
down due to a combination of fewer new accounts, order timing and
reduced utilization.
Gross margin was 54.4% for the fourth quarter 2021, compared to
56.1% in the prior-year period based on volume and an unfavorable
product and geographic mix. In contrast, volume and favorable mix
increased full-year gross margin to 56.7%, a 2.2% increase compared
to prior year.
Selling, general and administrative (“SG&A”) expenses for
the fourth quarter of 2021 were $4.1 million, representing a
decline of 7% compared to the prior year period and 12% below third
quarter of 2021 levels. Vigilant cost management amid the uncertain
market environment led to our lowest quarterly SG&A spend in
more than two years. For full year 2021, SG&A expenses were
$19.0 million, a 9% increase from prior year due to sales and
marketing investments plus non-recurring management transition and
administrative costs earlier in the year.
The net loss for the fourth quarter of 2021 was $4.4 million,
compared to a net loss of $3.1 million in the prior year period.
The primary difference in net loss compared to the prior year
period is due to a one-time foreign currency translation gain of
$1.2 million dollars resulting from the dissolution of an inactive
Australian subsidiary.
Cash and cash equivalents were approximately $24.2 million as of
December 31, 2021.
Webcast and Conference Call InformationThe
Company will host a conference call and webcast at 9:00 AM ET today
to discuss its financial results and provide an update on the
Company’s performance. To access the live webcast, please visit
http://ir.nuwellis.com. Alternatively, you may access the live
conference call by dialing (877) 303-9826 (U.S.) or (224) 357-2194
(international) and using conference ID: 9353528. An audio archive
of the webcast will be available following the call at
http://ir.nuwellis.com.
About NuwellisNuwellis, Inc. (Nasdaq:
NUWE) is a medical device company dedicated to transforming the
lives of patients suffering from fluid overload through science,
collaboration, and innovation. The Company is focused on
developing, manufacturing and commercializing the Aquadex
SmartFlow® system for ultrafiltration therapy. Nuwellis is
headquartered in Minneapolis, MN, with a wholly-owned subsidiary in
Ireland.
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 StatementsCertain 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 new market
opportunities and anticipated growth in 2022 and beyond.
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 risks 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. Nuwellis does not assume any
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Financial Statements
NUWELLIS, INC. AND
SUBSIDIARIESConsolidated Statements of Operations and
Comprehensive Loss (In thousands, except per share amounts)
|
|
Three months endedDecember
31, |
Twelve months endedDecember
31, |
|
|
2021 |
|
2020 |
|
|
|
2021 |
2020 |
|
Net sales |
$ |
1,642 |
|
$ |
2,044 |
|
|
$ |
7,921 |
|
$ |
7,441 |
|
Cost of goods sold |
|
748 |
|
|
897 |
|
|
|
3,430 |
|
|
3,384 |
|
Gross profit |
|
894 |
|
|
1,147 |
|
|
|
4,491 |
|
|
4,057 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
4,094 |
|
|
4,384 |
|
|
|
19,039 |
|
|
17,417 |
|
Research and development |
|
1,131 |
|
|
1,047 |
|
|
|
4,978 |
|
|
3,668 |
|
Total operating expenses |
|
5,225 |
|
|
5,431 |
|
|
|
24,017 |
|
|
21,085 |
|
Loss from operations |
|
(4,331 |
) |
|
(4,284 |
) |
|
(19,526 |
) |
|
(17,028 |
) |
Realized foreign currency
translation gain from dissolution of subsidiary |
|
- |
|
|
1,202 |
|
|
|
- |
|
|
1,202 |
|
Other income (expense),
net |
|
(21 |
) |
|
(2 |
) |
|
(43 |
) |
|
(1 |
) |
Loss before income taxes |
|
(4,352 |
) |
|
(3,084 |
) |
|
(19,569 |
) |
|
(15,827 |
) |
Income tax expense |
|
(2 |
) |
|
(2 |
) |
|
(9 |
) |
|
(9 |
) |
Net loss |
$ |
(4,354 |
) |
$ |
(3,086 |
) |
$ |
(19,578 |
) |
$ |
(15,836 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss
per share |
$ |
(0.41 |
) |
$ |
(1.13 |
) |
$ |
(2.87 |
) |
$ |
(10.67 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic and diluted |
|
10,538 |
|
|
2,736 |
|
|
|
6,852 |
|
|
1,649 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
loss: |
|
|
|
|
|
|
|
|
|
|
|
|
Realized foreign currency translation gain from dissolution of
subsidiary |
$ |
- |
|
$ |
(1,202 |
) |
$ |
- |
|
$ |
(1,202 |
) |
Unrealized foreign currency translation adjustments |
|
(1 |
) |
|
(12 |
) |
|
|
(4 |
) |
|
(19 |
) |
Total comprehensive
loss |
$ |
(4,355 |
) |
$ |
(4,300 |
) |
$ |
(19,582 |
) |
$ |
(17,057 |
) |
NUWELLIS, INC. AND
SUBSIDIARIES Consolidated Balance Sheets(In thousands,
except share and per share amounts)
|
|
December 31,2021 |
|
|
December 31,2020 |
ASSETS |
|
|
|
|
|
Current
assets |
|
|
|
|
|
Cash and cash equivalents
|
$ |
24,205 |
|
|
$ |
14,437 |
|
Accounts receivable |
|
750 |
|
|
|
905 |
|
Inventories |
|
2,843 |
|
|
|
2,957 |
|
Other current assets |
|
328 |
|
|
|
237 |
|
Total current
assets |
|
28,126 |
|
|
|
18,536 |
|
Property, plant and equipment, net |
|
1,188 |
|
|
|
1,200 |
|
Operating lease right-of-use asset, net |
|
1,082 |
|
|
|
255 |
|
Other assets |
|
21 |
|
|
|
21 |
|
TOTAL
ASSETS |
$ |
30,417 |
|
|
$ |
20,012 |
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
Accounts payable |
$ |
1,414 |
|
|
$ |
1,097 |
|
Accrued compensation |
|
1,664 |
|
|
|
2,192 |
|
Current portion of operating lease liability |
|
167 |
|
|
|
206 |
|
Current portion of finance lease liability |
|
26 |
|
|
|
24 |
|
Other current liabilities |
|
36 |
|
|
|
66 |
|
Total current
liabilities |
|
3,307 |
|
|
|
3,585 |
|
Operating lease liability |
|
956 |
|
|
|
55 |
|
Finance lease liability |
|
28 |
|
|
|
54 |
|
Other long-term liability |
|
179 |
|
|
|
— |
|
Total
liabilities |
|
4,470 |
|
|
|
3,694 |
|
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
Series A junior participating
preferred stock as of December 31, 2021 and December 31, 2020, par
value $0.0001 per share; authorized 30,000 shares, none
outstanding |
|
— |
|
|
|
— |
|
Series F convertible preferred
stock as of December 31, 2021 and December 31, 2020, par value
$0.0001 per share; authorized 127 shares, issued and outstanding
127 shares |
|
— |
|
|
|
— |
|
Preferred stock as of December
31, 2021 and December 31, 2020, par value $0.0001 per share;
authorized 39,969,873 shares, none outstanding |
|
— |
|
|
|
— |
|
Common stock as of December
31, 2021 and December 31, 2020, par value $0.0001 per share;
authorized 100,000,000 shares, issued and outstanding 10,537,606
and 2,736,060, respectively |
|
1 |
|
|
|
— |
|
Additional paid-in
capital |
|
278,873 |
|
|
|
249,663 |
|
Accumulated other
comprehensive income: |
|
|
|
|
|
Foreign currency translation adjustment |
|
(11 |
) |
|
|
(7 |
) |
Accumulated deficit |
|
(252,916 |
) |
|
|
(233,338 |
) |
Total stockholders’
equity |
|
25,947 |
|
|
|
16,318 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
$ |
30,417 |
|
|
$ |
20,012 |
|
NUWELLIS, INC. AND
SUBSIDIARIESConsolidated Statements of Cash Flows(In
thousands)
|
|
For the years endedDecember 31, |
|
|
|
2021 |
|
2020 |
|
|
Operating Activities |
|
|
|
|
|
|
Net loss |
|
$ |
(19,578 |
) |
$ |
(15,836 |
) |
|
Adjustments to reconcile net
loss to cash flows from operating activities: |
|
|
|
|
|
|
Depreciation and
amortization |
|
488 |
|
376 |
|
|
Stock-based compensation expense,
net |
|
1,314 |
|
1,349 |
|
|
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
|
|
155 |
|
(106 |
) |
|
Inventory |
|
(143 |
) |
(1,420 |
) |
|
Other current assets
|
|
(91 |
) |
(76 |
) |
|
Other assets and
liabilities |
|
186 |
|
112 |
|
|
Accounts payable and accrued expenses
|
|
(211 |
) |
191 |
|
|
Net cash used in
operations
|
|
(17,880 |
) |
(16,572 |
) |
|
|
|
|
|
|
|
|
Investing
activities: |
|
|
|
|
|
|
Purchase of property and equipment
|
|
(219 |
) |
(298 |
) |
|
Proceeds from the sale of property and equipment |
|
— |
|
31 |
|
|
Net cash used in
investing activities
|
|
(219 |
) |
(267 |
) |
|
|
|
|
|
|
|
|
Financing
activities: |
|
|
|
|
|
|
Proceeds from public stock offerings, net |
|
27,896 |
|
25,921 |
|
|
Proceeds from warrant exercises |
|
1 |
|
4,115 |
|
|
Payments on finance lease liability |
|
(26 |
) |
(20 |
) |
|
Net cash provided by
financing activities
|
|
27,871 |
|
30,016 |
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash
|
|
(4 |
) |
(19 |
) |
|
Net increase (decrease) in
cash and cash equivalents
|
|
9,768 |
|
13,158 |
|
|
Cash and cash
equivalents—beginning of year
|
|
14,437 |
|
1,279 |
|
|
Cash and cash
equivalents—end of year
|
|
$ |
24,205 |
|
$ |
14,437 |
|
|
|
|
|
|
|
|
|
Supplemental schedule
of non-cash activities |
|
|
|
|
|
|
Inventory transferred to property, plant and equipment |
|
$ |
257 |
|
$ |
260 |
|
|
Equipment acquired through finance lease liability |
|
$ |
— |
|
$ |
98 |
|
|
Operating right-of-use asset recorded as an operating lease
liability |
|
$ |
901 |
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow
information |
|
|
|
|
|
|
|
|
Cash paid for income taxes |
|
$ |
11 |
|
$ |
10 |
|
|
INVESTOR CONTACTS:
George MontagueChief Financial Officer, Nuwellis, Inc.
ir@nuwellis.com
Matt BacsoGilmartin Group Matt.Bacso@gilmartinir.com
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