Obalon Announces Second Quarter 2017 Financial Results
SAN DIEGO, Aug. 02, 2017 (GLOBE NEWSWIRE) -- Obalon Therapeutics, Inc. (NASDAQ:OBLN), a vertically integrated medical technology company with the first and only FDA-approved swallowable, gas-filled intragastric balloon system for the treatment of obesity, today announced its unaudited financial results as of and for the second quarter ended June 30, 2017.
Second Quarter 2017 highlights:
- Revenue grew 33% sequentially over Q1-17 to $2.0 million
- Gross margin improved to 50%
- First commercial shipments of 6-month product to Middle East in July 2017
- First US shipments of HPMC, vegetable based capsule, in July 2017
The Company reported total revenues of $2.0 million for the second quarter of 2017, compared to $0.8 million for the second quarter of 2016. Net loss was reported at $7.7 million compared to a net loss of $4.1 million in the second quarter of 2016 and net loss per share for the quarter was $0.46 as compared to net loss per share of $7.15 in the second quarter of 2016.
Cost of goods sold was $1.0 million during the three months ended June 30, 2017, up from $0.7 million for the prior year period. Gross profit for the second quarter of 2017 was $1.0 million, resulting in a gross margin of 50%, compared to a gross profit of $0.1 million and gross margin of 14% for the second quarter of 2016.
Research and Development expense for the second quarter of 2017 totaled $2.8 million, up from $2.6 million in the second quarter of 2016, and Selling, General and Administrative expense increased to $5.9 million for the second quarter of 2017, compared to $1.6 million in the second quarter 2016.
Operating loss for the second quarter of 2017 was $7.6 million, compared to an operating loss of $4.1 million for the second quarter of 2016.
At June 30, 2017, cash, cash equivalents and short-term investments were $60.7 million and long-term debt was $10.0 million.
Call Information
A conference call to discuss second quarter 2017 financial results is scheduled for today, August 2, 2017, at 8:30 AM Eastern Time (5:30 AM Pacific Time). Interested parties may access the conference call by dialing (844) 889-7791 (U.S.) or (661) 378-9934 (international) using passcode 61524873. Media and individuals will be in a listen-only mode. Participants are asked to dial in a few minutes prior to the call to register for the event. The conference call will also be webcast live at: http://edge.media-server.com/m/p/si96igkx.
A replay of the call will be available through August 9, 2017, 11:30 AM EDT by calling (855) 859-2056 (U.S.) or (404) 537-3406 (international), using passcode 61524873. An archive of the webcast will be available for twelve months following the event on the Obalon Therapeutics, Inc. website located at http://investor.obalon.com in the “News & Events” section.
About Obalon Therapeutics, Inc.
Obalon Therapeutics, Inc. (NASDAQ:OBLN) is a San Diego-based company focused on developing and commercializing novel technologies for weight loss. The Obalon management team has over 150 combined years of experience in developing and commercializing novel medical technologies with a track record of financial and clinical excellence. For more information, please visit www.obalon.com.
| OBALON THERAPEUTICS, INC. | |||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | |||||||||||||||
| (in thousands, except shares and per share data) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||
| (Unaudited) | |||||||||||||||
| Revenue: | |||||||||||||||
| Revenue | $ | 1,963 | $ | — | $ | 3,435 | $ | — | |||||||
| Revenue, related party | — | 779 | — | 1,848 | |||||||||||
| Total revenue | 1,963 | 779 | 3,435 | 1,848 | |||||||||||
| Cost of revenue | 990 | 672 | 1,813 | 1,294 | |||||||||||
| Gross profit | 973 | 107 | 1,622 | 554 | |||||||||||
| Operating expenses: | |||||||||||||||
| Research and development | 2,760 | 2,586 | 5,160 | 5,098 | |||||||||||
| Selling, general and administrative | 5,853 | 1,596 | 11,793 | 2,975 | |||||||||||
| Total operating expenses | 8,613 | 4,182 | 16,953 | 8,073 | |||||||||||
| Loss from operations | (7,640 | ) | (4,075 | ) | (15,331 | ) | (7,519 | ) | |||||||
| Interest expense, net | (35 | ) | (143 | ) | (89 | ) | (290 | ) | |||||||
| Gain from change in fair value of warrant liability | — | 96 | — | 119 | |||||||||||
| Other expense, net | (55 | ) | (9 | ) | (55 | ) | (22 | ) | |||||||
| Net loss | (7,730 | ) | (4,131 | ) | (15,475 | ) | (7,712 | ) | |||||||
| Other comprehensive (loss) income | — | 6 | (18 | ) | 4 | ||||||||||
| Net loss and comprehensive loss | $ | (7,730 | ) | $ | (4,125 | ) | $ | (15,493 | ) | $ | (7,708 | ) | |||
| Net loss per share, basic and diluted | $ | (0.46 | ) | $ | (7.15 | ) | $ | (0.93 | ) | $ | (13.37 | ) | |||
| Weighted-average common shares outstanding, basic and diluted | 16,637,335 | 577,659 | 16,599,891 | 576,757 | |||||||||||
| OBALON THERAPEUTICS, INC. | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (in thousands, except shares and par value data) | ||||||||
| June 30, 2017 | December 31, 2016 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 5,827 | $ | 72,975 | ||||
| Short-term investments | 54,898 | 2,500 | ||||||
| Accounts receivable, net | 1,757 | — | ||||||
| Accounts receivable, related party | — | 515 | ||||||
| Inventory | 747 | 827 | ||||||
| Other current assets | 705 | 1,244 | ||||||
| Total current assets | 63,934 | 78,061 | ||||||
| Property and equipment, net | 1,044 | 717 | ||||||
| Total assets | $ | 64,978 | $ | 78,778 | ||||
| Liabilities and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued expenses | $ | 697 | $ | 595 | ||||
| Accrued compensation | 2,381 | 2,497 | ||||||
| Accrued clinical expenses | 192 | 101 | ||||||
| Deferred revenue | 206 | 121 | ||||||
| Other current liabilities | 1,341 | 1,278 | ||||||
| Total current liabilities | 4,817 | 4,592 | ||||||
| Deferred rent | 39 | — | ||||||
| Long-term loan, excluding current portion | 9,901 | 9,881 | ||||||
| Total long-term liabilities | 9,940 | 9,881 | ||||||
| Total liabilities | 14,757 | 14,473 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Common stock, $0.001 par value; 300,000,000 shares authorized as of June 30, 2017 and December 31, 2016; 16,822,416 and 16,773,205 shares issued and outstanding as of June 30, 2017 and December 31, 2016, respectively |
17 | 17 | ||||||
| Additional paid-in capital | 142,307 | 140,898 | ||||||
| Accumulated other comprehensive loss | (19 | ) | (1 | ) | ||||
| Accumulated deficit | (92,084 | ) | (76,609 | ) | ||||
| Total stockholders’ equity | 50,221 | 64,305 | ||||||
|
Total liabilities and stockholders’ equity |
$ | 64,978 | $ | 78,778 | ||||
| OBALON THERAPEUTICS, INC. | |||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
| (in thousands) | |||||||
| Six Months Ended June 30, | |||||||
| 2017 | 2016 | ||||||
| (Unaudited) | |||||||
| Operating activities: | |||||||
| Net loss | $ | (15,475 | ) | $ | (7,712 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
| Depreciation and amortization | 136 | 90 | |||||
| Stock-based compensation | 1,079 | 145 | |||||
| Loss on disposal of fixed assets | — | 13 | |||||
| Change in fair value of warrant liability | — | (119 | ) | ||||
| Amortization of investment premium, net | 11 | 55 | |||||
| Amortization of debt discount | 20 | 43 | |||||
| Change in operating assets and liabilities: | |||||||
| Accounts receivable | (1,757 | ) | — | ||||
| Accounts receivable from related party | 515 | 51 | |||||
| Inventory | 80 | (114 | ) | ||||
| Other current assets | 539 | 46 | |||||
| Accounts payable and accrued expenses | 58 | 60 | |||||
| Accrued compensation | (116 | ) | (1,014 | ) | |||
| Accrued clinical expenses | 91 | (301 | ) | ||||
| Deferred revenue | 85 | — | |||||
| Other current and long term liabilities | 326 | 94 | |||||
| Net cash used in operating activities | (14,408 | ) | (8,663 | ) | |||
| Investing activities: | |||||||
| Purchases of short-term investments | (64,928 | ) | (14,979 | ) | |||
| Maturities of short-term investments | 12,500 | 10,150 | |||||
| Purchase of property and equipment | (559 | ) | (63 | ) | |||
| Net cash used in investing activities | (52,987 | ) | (4,892 | ) | |||
| Financing activities: | |||||||
| Issuance of preferred stock for cash, net of offering costs | — | 14,517 | |||||
| Proceeds from stock issued under employee stock purchase plan | 210 | — | |||||
| Proceeds from sale of common stock upon exercise of stock options | 37 | 11 | |||||
| Net cash provided by financing activities | 247 | 14,528 | |||||
| Net (decrease) increase in cash and cash equivalents | (67,148 | ) | 973 | ||||
| Cash and cash equivalents at beginning of period | 72,975 | 3,356 | |||||
| Cash and cash equivalents at end of period | $ | 5,827 | $ | 4,329 | |||
| Supplemental cash flow information: | |||||||
| Interest paid | $ | 270 | $ | 266 | |||
| Non-cash investing and financing activities: | |||||||
| Property and equipment in accounts payable | $ | 96 | $ | 121 | |||
For Obalon Therapeutics, Inc. Investor Contact: William Plovanic Chief Financial Officer Obalon Therapeutics, Inc. Office: +1 760 607 5103 wplovanic@obalon.com Media: Megan Driscoll EvolveMKD Office Phone: +1 646 517 4220 mdriscoll@evolvemkd.com
