Vericel Reports First Quarter 2020 Financial Results
8:00 am ET May 5, 2020 (Globe Newswire) Print
Product Revenues of $26.7 Million Increase 22% Over First Quarter 2019
Positive Cash Flow for the Quarter
Conference Call Today at 8:30am Eastern Time
Vericel Corporation (NASDAQ:VCEL), a leader in advanced therapies for the sports medicine and severe burn care markets, today reported financial results and business highlights for the first quarter ended March 31, 2020.
First Quarter 2020 Financial Highlights
-- Total net product revenues increased 22% to $26.7 million, compared to $21.8 million in the first quarter of 2019, marking the twelfth consecutive quarter with record revenues for the reported quarter;
-- MACI net revenue of $20.3 million and Epicel net revenue of $6.4 million; the cancellation of scheduled MACI procedures late in the first quarter due to restrictions on elective surgical procedures reduced the volume of MACI implants for the quarter by approximately 9%;
-- Gross margin of 63%, compared to gross margin of 60% in the first quarter of 2019;
-- Net loss of $4.7 million, or $0.10 per share, compared to $2.8 million, or $0.07 per share, in the first quarter of 2019;
-- Non-GAAP adjusted EBITDA loss of $0.7 million, compared to $0.4 million in the first quarter of 2019;
-- Operating cash flow of $4.7 million; and
-- As of March 31, 2020, the company had $83.3 million in cash and investments, compared to $79.0 million as of December 31, 2019, and no debt.
Business Highlights and Updates
-- Implemented multiple measures in response to the COVID-19 pandemic to safeguard the health and well-being of employees, their families, business partners and healthcare providers, while continuing to supply MACI and Epicel to patients with knee cartilage and severe burn injuries;
-- Continued to provide field-based support for MACI and Epicel surgical cases, as needed, in compliance with applicable governmental orders and surgical facility policies and procedures;
-- Implemented the MACI sales force expansion from 49 to 76 sales territories and from six to nine sales regions;
-- Expanded utilization of virtual tools to support physician education initiatives in regions where executive orders or hospital policies restricted access;
-- Continued to actively work with surgeon offices and patients to move cases through the pipeline and reschedule or prepare to reschedule cancelled and postponed cases;
-- Implemented appropriate expense reduction measures, while maintaining workforce and operational readiness to rapidly return to normal operations when conditions allow; and
-- Continue to plan for a mid-2020 submission of the NexoBrid Biologics License Application to the FDA.
"The entire Vericel team would like to thank healthcare workers across the nation for their selfless efforts in the treatment and care of COVID-19 patients, and I would also like to thank all of our employees for their dedication and commitment to ensure that our customers and patients continue to have access to our products and clinical case support," said Nick Colangelo, President and CEO of Vericel. "I remain highly confident in the fundamental prospects for our business given the significant clinical need for both MACI and Epicel and, while uncertainties remain, we expect a robust return of MACI orders in regions where elective surgery restrictions are being lifted."
2020 Financial Guidance
As previously reported on April 2, 2020, due to the continued uncertainties resulting from the impact of the COVID-19 pandemic, the company has withdrawn its previously announced 2020 financial guidance.
First Quarter 2020 Results
Total net product revenues for the quarter ended March 31, 2020 increased 22% to $26.7 million, compared to $21.8 million in the first quarter of 2019. Total net product revenues for the quarter included $20.3 million of MACI (autologous cultured chondrocytes on porcine collagen membrane) net revenue and $6.4 million of Epicel (cultured epidermal autografts) net revenue, compared to $16.6 million of MACI net revenue and $5.2 million of Epicel net revenue, respectively, in the first quarter of 2019.
Gross profit for the quarter ended March 31, 2020 was 16.8 million, or 63% of net revenues, compared to $13.2 million, or 60% of net revenues, for the first quarter of 2019.
Total operating expenses for the quarter ended March 31, 2020 were $21.8 million, compared to $16.5 million for the same period in 2019. The increase in operating expenses was primarily due to a $1.3 million increase in MACI sales force expenses driven by the expansions in the first quarter of 2019 and 2020, a $0.9 million increase in stock based compensation expense, a $0.6 million increase in patient reimbursement support services, a $0.6 million increase in non-sales force related salaries and a $0.6 million increase in Epicel sales force expenses compared to the same period a year ago.
Vericel's net loss for the quarter ended March 31, 2020 was $4.7 million, or $0.10 per share, compared to $2.8 million, or $0.07 per share, for the first quarter of 2019.
Non-GAAP adjusted EBITDA loss was $0.7 million for the quarter ended March 31, 2020, compared to $0.4 million in the first quarter of 2019. A table reconciling non-GAAP measures is included in this press release for reference.
As of March 31, 2020, the company had $83.3 million in cash and investments, compared to $79.0 million as of December 31, 2019, and no debt.
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