Record Quarterly Clinical Testing Revenues of
$2.6 million
Conference call begins today at 10:00 a.m.
Eastern time
Rosetta Genomics Ltd. (NASDAQ:ROSG), a leading developer and
provider of microRNA-based and other molecular diagnostics, today
reported financial results for the three months ended March 31,
2016.
Recent developments include:
- Expanded molecular diagnostics test
menu with the launch of three new product offerings in common
hematologic cancers and solid tumors;
- Received conditional approval status
from the New York State Department of Health (NYSDOH) for RosettaGX
Reveal™, the Company’s novel microRNA classifier for the diagnosis
of indeterminate thyroid Fine Needle Aspirate (FNA) smears;
- Entered into an agreement that
establishes health insurance access to Rosetta’s entire suite of
diagnostic tests and services with America’s Choice Provider
Network (ACPN®), an independent multispecialty national provider
network; and
- Granted U.S. patent allowance for use
of gene expression signature for classification of kidney tumors
and granted European patent allowance for use of microRNA molecules
for the treatment of liver cancer.
Management Commentary
“We are especially pleased to report record quarterly clinical
testing revenues as it demonstrates the progress we have made in
expanding our molecular diagnostics test menu, selling our clinical
testing products and improving collections,” said Kenneth A.
Berlin, President and Chief Executive Officer of Rosetta Genomics.
“Throughout the first quarter we completed the revamping of our
sales force and invested in our billing and collections department.
The results are reflected in our growing revenue and expanding
customer base, as well as in improved collections. Further, these
changes position us to drive revenue growth throughout the balance
of the year and beyond.
“The commercial launch of RosettaGX Reveal continues to be a
prime focus for our team. We expect the positive performance data
from our blinded validation study to be published in a
peer-reviewed journal in the coming weeks. These data demonstrate
exceptional performance and we anticipate that a journal
publication will strongly support our reimbursement and sales
efforts. In addition, our revamped sales team has been able to use
RosettaGX Reveal to access new accounts to promote not only our
exceptional thyroid offering, but also to promote our urologic
cancer and solid tumor product lines. Since the beginning of the
year, these promotional efforts resulted in the acquisition of over
30 thyroid customer accounts and over 60 new customer accounts for
our urology and solid tumor businesses.
“Our work for the balance of the year will continue to focus on
driving revenue growth in both our base business as well as with
our new products, such as RosettaGX Reveal, expanding
reimbursement, improving collections and advancing our clinical
development programs, which should position us to achieve a number
of important milestones that will enhance shareholder value,”
concluded Mr. Berlin.
First Quarter Financial Results
Please note that the pro forma comparisons below are meant to
provide a comparison as if the PersonalizeDx acquisition occurred
on January 1, 2015. The actual acquisition date was April 13,
2015.
- Revenues for the first quarter of 2016
increased 711% to $2.6 million compared with revenues of $321,000
for the first quarter of 2015, and increased 27% compared with pro
forma revenues of $2.1 million for the first quarter of 2015.
- Revenues from urologic cancer testing
services in the first quarter of 2016 were $1.4 million, an
increase of 7% compared with pro forma revenues of $1.3 million for
the first quarter of 2015, and represented approximately 54% of
clinical testing revenues for the quarter.
- Revenues from solid tumor testing
services in the first quarter of 2016 increased 272% to $1.2
million compared with revenues of $321,000 for the first quarter of
2015, and increased 58% compared with pro forma revenues of $0.8
million in the first quarter of 2015. Solid tumor testing services
represented nearly 46% of total clinical testing revenues during
the first quarter of 2016, with the balance coming from RosettaGX
Reveal.
- Cost of revenues for the first quarter
of 2016 increased to $1.7 million compared with $352,000 for the
first quarter of 2015, due to the acquisition of PersonalizeDx
leading to a higher volume of processed samples, as well as to
increases in personnel and infrastructure.
- Research and development expenses for
the first quarter of 2016 increased to $842,000 from $748,000 for
the first quarter of 2015, primarily due to increased activities in
Thyroid and other areas.
- Sales, marketing and business
development expenses for the first quarter of 2016 increased to
$1.9 million from $1.6 million in the prior-year period due to a
larger commercial footprint as a result of the acquisition of
PersonalizeDx.
- General and administrative expenses for
the first quarter of 2016 increased to $2.2 million compared with
$1.4 million for the same period in 2015, with the increase
primarily due to increased personnel and activities related to the
acquisition of PersonalizeDx.
- The operating loss for the first
quarter of 2016 was $4.0 million, which included $230,000 of
non-cash stock-based compensation expense, compared with an
operating loss of $3.8 million for the first quarter of 2015, which
included $276,000 of non-cash stock-based compensation
expense.
- The net loss for the first quarter of
2016 was $4.0 million, or $0.20 per ordinary share on 20.7 million
weighted average shares outstanding, compared with a net loss for
the first quarter of 2015 of $3.9 million, or $0.30 per ordinary
share on 12.8 million weighted average shares outstanding.
- On a non-GAAP basis, excluding $230,000
of non-cash stock-based compensation expense, the net loss for the
first quarter of 2016 was $3.8 million, or $0.18 per ordinary share
on 20.7 million weighted average shares outstanding. For the first
quarter of 2015, excluding the $276,000 of non-cash stock-based
compensation expense, the non-GAAP net loss was $3.6 million, or
$0.28 per ordinary share on 12.8 million weighted average share
outstanding.
Balance Sheet Highlights
As of March 31, 2016, Rosetta Genomics had cash, cash
equivalents, restricted cash and short-term bank deposits of $12.6
million compared with $13.6 million as of December 31, 2015. The
Company used approximately $2.6 million in cash to fund operations
during the first quarter of 2016, and collected approximately $2.7
million in cash from its clinical testing services in addition to
$1.6 million in cash receipts from a licensing deal signed in
December 2015. Based on the Company’s current operations and plans,
which include a cost-reduction plan should it be unable to raise
sufficient additional capital, if necessary, Rosetta Genomics
expects its current cash position will fund operations for at least
the next 12 months.
Conference Call
Rosetta Genomics management will host a conference call today
beginning at 10:00 a.m. Eastern time to provide an update on the
Company’s business and answer questions. Individuals interested in
listening to the conference call may do so by dialing (866)
239-5859, or for international callers (702) 495-1913. The
conference ID number is 12008886. The call is also being webcast,
and can be accessed on the investor relations section of the
Company’s website at www.rosettagx.com.
A telephone replay will be available through May 29, 2016 by
dialing (855) 859-2056 or for international callers (404) 537-3406,
and entering the conference ID number 12008886. The webcast will be
available on the Company’s website for 30 days.
Use of Non-GAAP Financial Measures
This press release contains certain non-GAAP financial measures.
A "non-GAAP financial measure" refers to a numerical measure of
historical or future financial performance, financial position or
cash flows that excludes (or includes) amounts that are included in
(or excluded from) the most directly comparable measure calculated
and presented in accordance with GAAP in the financial statements.
In this news release, Rosetta provides non-GAAP pro forma revenues
and non-GAAP net loss as additional information relating to its
operating results. The presentation of this additional information
is not meant to be considered in isolation or as a substitute for
revenues, net loss or net loss per share prepared in accordance
with GAAP.
Pursuant to the requirements of Regulation G promulgated by the
Securities and Exchange Commission, the Company has provided a
reconciliation of each non-GAAP financial measure used in this
earnings release and related conference call or webcast to the most
directly comparable financial measure prepared in accordance with
GAAP. This reconciliation is presented in the tables below under
the heading "Reconciliation of GAAP to Non-GAAP Consolidated
Statement of Operation." Investors are encouraged to review these
reconciliations to ensure they have a thorough understanding of the
reported non-GAAP financial measures and their most directly
comparable GAAP financial measures.
Management uses these non-GAAP measures for internal reporting
and forecasting purposes. The Company has provided these non-GAAP
financial measures in addition to GAAP financial results because it
believes that these non-GAAP financial measures provide useful
information to certain investors and financial analysts for
comparison across accounting periods not influenced by certain
non-cash items that are not used by management when evaluating the
Company's historical and prospective financial performance.
About Rosetta Genomics
Rosetta develops and commercializes a full range of
microRNA-based and other molecular diagnostics. Rosetta’s
integrative research platform combining bioinformatics and
state-of-the-art laboratory processes has led to the discovery of
hundreds of biologically validated novel human microRNAs. Building
on its strong patent position and proprietary platform
technologies, Rosetta is working on the application of these
technologies in the development and commercialization of a full
range of microRNA-based diagnostic tools. In addition, the Company
offers core FISH, IHC and PCR-based testing capabilities in
Pathology, Oncology and Urology that provide additional content and
platforms that complement Rosetta’s microRNA and Next-Gen
Sequencing offerings. RosettaGX Reveal™, a Thyroid microRNA
Classifier for the diagnosis of indeterminate thyroid FNA smears,
as well as the full RosettaGX™ portfolio of cancer testing services
are commercially available through the Company’s Philadelphia, PA-
and Lake Forest, CA-based CAP-accredited, CLIA-certified labs. For
more information visit www.rosettagx.com.
Forward-Looking Statement Disclaimer
Various statements in this release concerning Rosetta’s future
expectations, plans and prospects including, but not limited
to statements that the changes in our sales force and billing
and collections department position us to drive revenue growth
throughout the balance of the year and beyond; that data from our
blinded validation study for RosettaGX Reveal™ will be published in
a peer-reviewed journal in the coming weeks and that such
publication will support our reimbursement and sales efforts; and
that work for the balance of the year will position us to achieve a
number of important milestones that will enhance shareholder value;
and that our cash, cash equivalents, restricted cash and short-term
bank deposits will be sufficient to fund operations for at least
the next 12 months, constitute forward-looking statements for the
purposes of the safe harbor provisions under The Private Securities
Litigation Reform Act of 1995. Actual results may differ materially
from those indicated by these forward-looking statements as a
result of various important factors, including those risks more
fully discussed in the "Risk Factors" section of Rosetta’s most
recently filed Annual Report on Form 20-F, as filed with the SEC.
In addition, any forward-looking statements represent Rosetta’s
views only as of the date of this release and should not be relied
upon as representing its views as of any subsequent date. Rosetta
does not assume any obligation to update any forward-looking
statements unless required by law.
CONDENSED INTERIM CONSOLIDATED BALANCE
SHEETS
U.S. dollars in thousands
March 31, December 31, 2016 2015
Unaudited ASSETS CURRENT ASSETS: Cash and cash
equivalents $ 11,901 $ 12,447 Short-term bank deposits and
restricted cash 602 1,098 Trade receivables, net 3,132 3,633 Other
accounts receivable and prepaid expenses 674 2,192
Total current
assets
16,309 19,370 LONG TERM ASSETS:
Property and equipment, net 2,867 2,975 Restricted bank deposit and
other long-term receivables 84 78
Total long
term assets
2,951 3,053
Total
assets
$ 19,260 $ 22,423
CONDENSED INTERIM CONSOLIDATED BALANCE
SHEETS
U.S. dollars in thousands (except share
data)
March 31, December 31, 2016 2015
Unaudited LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES: Trade payables $ 1,304 $ 1,070 Other accounts
payables and accruals 2,143 1,733
Total current
liabilities
3,447 2
,803 COMMITMENTS
AND CONTINGENT LIABILITIES SHAREHOLDERS EQUITY: Share
capital:
Ordinary Shares of NIS 0.6 par value:
60,000,000 shares authorized at March 31, 2016 and
December 31, 2015; 20,856,045 and 20,518,794 shares
issued at March 31, 2016 and December 31, 2015,
respectively; 20,852,787 and 20,515,536 shares
outstanding at March 31, 2016 and December 31, 2015,
respectively
3,245 3,194 Additional paid-in capital 156,875 156,696 Accumulated
deficit (144,307 ) (140,270 )
Total
shareholders' equity
15,813 19,620
Total
liabilities and shareholders' equity
$ 19,260 $ 22,423
CONDENSED INTERIM CONSOLIDATED
STATEMENTS OF LOSS
U.S. dollars in thousands (except share
and per share data)
Three months ended
March 31,
2016 2015 Unaudited Revenues $ 2,603 $
321 Cost of revenues 1,658 352 Gross
profit (loss) 945 (31 ) Operating expenses:
Research and development, net 842 748 Sales, marketing and
business development 1,897 1,597 General and administrative
2,213 1,411 Total operating expenses
4,952 3,756 Operating loss 4,007 3,787
Financial expenses, net 24 76 Tax expense 6 5
Net loss $ 4,037 $ 3,868
Basic and diluted net loss per ordinary
share attributable to Rosetta Genomics' shareholders
$ 0.20 $ 0.30
Weighted average number of ordinary shares
used to compute basic and diluted net loss per ordinary
share
20,650,323 12,767,221
Quarter ended March 31, 2015
USD in
thousands
(Unaudited) GAAP revenues $ 321
Additional revenues from PersonalizeDx for
non-consolidated period of January 1, 2015 - April 12, 2015
1,734 Pro forma revenues $ 2,055
Quarter ended
March 31, 2015
USD in
thousands
(Unaudited) GAAP revenues for solid tumor testing services $
321
Additional revenues from PersonalizeDx for
non-consolidated period of January 1, 2015 - April 12, 2015
432 Pro forma revenues for solid tumor testing services $ 753
Quarter ended March 31, 2015
USD in
thousands
(Unaudited) GAAP revenues for urologic cancer testing
services $
-
Additional revenues from PersonalizeDx for
non-consolidated period of January 1, 2015 - April 12, 2015
1,302 Pro forma revenues for urologic cancer testing services $
1,302
Quarter ended March 31,
2016 2015
USD in
thousands
(Unaudited) (Unaudited) Net loss $
4,037 $ 3,868 Share-based compensation 230
276
non-GAAP net loss
$ 3,807 $ 3,592
Quarter ended March 31, 2016
2015
Basic and diluted
per share data
(Unaudited) (Unaudited) Net loss $
0.195 $ 0.303 Share-based compensation $ 0.011 $
0.022
non-GAAP net loss $ 0.184
$ 0.281
Weighted average number of Ordinary shares
used to
compute basic and diluted net loss per Ordinary share 20,650,323
12,767,221
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160519005354/en/
Rosetta Genomics:Ken Berlin, 267-298-1159President &
CEOinvestors@rosettagx.comorRosetta Genomics
Investors:LHAAnne Marie Fields,
212-838-3777afields@lhai.com
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