SAN DIEGO, Aug. 02, 2018 (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, 2018.
Second Quarter 2018 highlights:
- Total revenue of $2.7 million increased 103% vs Q1-18 and 39% vs Q2-17
- US revenue of $1.5 million increased 211% vs Q1-18 and decreased 20% vs Q2-17
- US Reorders were $1.0 million, or 64% of US sales, an increase of 221% vs Q1-18 and 61% vs Q2-17
- Operating loss of $9.6 million decreased 20% vs $12.1 million in Q1-18 and increased 26% vs $7.6 million in Q2-17
- Amended loan agreement providing access to additional $10.0 million
- Filed PMA-S response for Touch dispenser
- Filed PMA-S for Touch-compatible Navigation system
The Company reported revenue of $2.7 million for the second quarter of 2018, compared to $1.3 million for the first quarter of 2018 and $2.0 million for the second quarter of 2017. Net loss was reported at $9.8 million for the second quarter of 2018, compared to $12.1 million for the first quarter of 2018 and $7.7 million for the second quarter of 2017. Net loss per share for the second quarter of 2018 was $0.57 as compared to $0.71 for the first quarter of 2018 and $0.46 for the second quarter of 2017.
Cost of revenue was $1.7 million for the second quarter of 2018, up from $0.8 million for the first quarter of 2018 and $1.0 million for second quarter of 2017. Gross profit for the second quarter of 2018 was $1.0 million, resulting in a gross margin of 37%, compared to a gross profit of $0.6 million and gross margin of 43% for the first quarter of 2018 and a gross profit of $1.0 million and gross margin of 50% for the second quarter of 2017.
Research and Development expense for the second quarter of 2018 totaled $3.4 million, up from $2.6 million for the first quarter of 2018 and $2.8 million for the second quarter of 2017. Selling, General and Administrative expense decreased to $7.3 million for the second quarter of 2018 as compared to $10.0 million for the first quarter of 2018 and increased from $5.9 million for the second quarter of 2017.
Operating loss for the second quarter of 2018 was $9.6 million, down from $12.1 million for the first quarter of 2018, but up from $7.6 million for the second quarter of 2017.
As of June 30, 2018, cash, cash equivalents and short-term investments were $25.2 million.
“We are pleased with the increase in revenue compared to Q1-18, especially with reorder revenues from existing customers,” said Bill Plovanic, CFO of Obalon. “In Q2-18, we reduced our cash usage by $2.7 million compared to Q1-18. We believe this, along with the $25.2 million cash on hand at the end of Q2-18 and access to an additional $10.0 million of debt, furthers our ability to support the continued development of this novel and exciting non-surgical treatment for obesity.”
Call Information
A conference call to discuss second quarter 2018 financial results is scheduled for today, August 2, 2018, 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 6384879. 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: https://edge.media-server.com/m6/p/jud3fsps.
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.
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
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, | ||||||||||||||
| 2018 | 2017 | 2018 | 2017 | ||||||||||||
| (Unaudited) | |||||||||||||||
| Revenue | $ | 2,732 | $ | 1,963 | $ | 4,078 | $ | 3,435 | |||||||
| Cost of revenue | 1,732 | 990 | 2,501 | 1,813 | |||||||||||
| Gross profit | 1,000 | 973 | 1,577 | 1,622 | |||||||||||
| Operating expenses: | |||||||||||||||
| Research and development | 3,352 | 2,760 | 5,991 | 5,160 | |||||||||||
| Selling, general and administrative | 7,250 | 5,853 | 17,256 | 11,793 | |||||||||||
| Total operating expenses | 10,602 | 8,613 | 23,247 | 16,953 | |||||||||||
| Loss from operations | (9,602 | ) | (7,640 | ) | (21,670 | ) | (15,331 | ) | |||||||
| Interest expense, net | (57 | ) | (35 | ) | (94 | ) | (89 | ) | |||||||
| Other expense | (94 | ) | (55 | ) | (115 | ) | (55 | ) | |||||||
| Net loss | (9,753 | ) | (7,730 | ) | (21,879 | ) | (15,475 | ) | |||||||
| Other comprehensive income (loss) | — | — | 6 | (18 | ) | ||||||||||
| Net loss and comprehensive loss | $ | (9,753 | ) | $ | (7,730 | ) | $ | (21,873 | ) | $ | (15,493 | ) | |||
| Net loss per share, basic and diluted | $ | (0.57 | ) | $ | (0.46 | ) | $ | (1.29 | ) | $ | (0.93 | ) | |||
| Weighted-average common shares outstanding, basic and diluted | 17,039,876 | 16,637,335 | 17,013,529 | 16,599,891 | |||||||||||
OBALON THERAPEUTICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except shares and par value data)
| June 30, 2018 | December 31, 2017 | ||||||
| Assets | (Unaudited) | ||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 24,212 | $ | 21,108 | |||
| Short-term investments | 997 | 23,292 | |||||
| Accounts receivable, net of allowance of $433 and $239, respectively | 3,049 | 4,223 | |||||
| Inventory | 1,842 | 1,418 | |||||
| Other current assets | 857 | 1,714 | |||||
| Total current assets | 30,957 | 51,755 | |||||
| Property and equipment, net | 1,514 | 1,346 | |||||
| Total assets | $ | 32,471 | $ | 53,101 | |||
| Liabilities and Stockholders’ Equity | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 1,445 | $ | 1,276 | |||
| Accrued compensation | 2,132 | 4,494 | |||||
| Deferred revenue | 302 | 510 | |||||
| Other current liabilities | 2,552 | 1,773 | |||||
| Current portion of long-term loan | 3,965 | 1,958 | |||||
| Total current liabilities | 10,396 | 10,011 | |||||
| Deferred rent | 44 | 13 | |||||
| Long-term loan, excluding current portion | 5,980 | 7,964 | |||||
| Total long-term liabilities | 6,024 | 7,977 | |||||
| Total liabilities | 16,420 | 17,988 | |||||
| Commitments and contingencies | |||||||
| Stockholders’ equity: | |||||||
| Common stock, $0.001 par value; 100,000,000 and 300,000,000 shares authorized as of June 30, 2018 and December 31, 2017, respectively; 17,858,704 and 17,500,604 shares issued and outstanding as of June 30, 2018 and December 31, 2017, respectively | 18 | 18 | |||||
| Additional paid-in capital | 149,285 | 146,474 | |||||
| Accumulated other comprehensive gain (loss) | 1 | (5 | ) | ||||
| Accumulated deficit | (133,253 | ) | (111,374 | ) | |||
| Total stockholders’ equity | 16,051 | 35,113 | |||||
| Total liabilities and stockholders’ equity | $ | 32,471 | $ | 53,101 | |||
OBALON THERAPEUTICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
| Six Months Ended June 30, | |||||||
| 2018 | 2017 | ||||||
| (Unaudited) | |||||||
| Operating activities: | |||||||
| Net loss | $ | (21,879 | ) | $ | (15,475 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
| Depreciation | 276 | 136 | |||||
| Stock-based compensation | 2,603 | 1,079 | |||||
| Loss on disposal of fixed assets | 107 | — | |||||
| (Accretion) amortization of investment (discount) premium, net | (7 | ) | 11 | ||||
| Amortization of debt discount | 22 | 20 | |||||
| Change in operating assets and liabilities: | |||||||
| Accounts receivable, net | 1,174 | (1,757 | ) | ||||
| Accounts receivable from related party | — | 515 | |||||
| Inventory | (424 | ) | 80 | ||||
| Other current assets | 857 | 539 | |||||
| Accounts payable | 275 | 58 | |||||
| Accrued compensation | (2,362 | ) | (116 | ) | |||
| Accrued clinical expenses | 418 | 91 | |||||
| Deferred revenue | (208 | ) | 85 | ||||
| Other current and long term liabilities | 424 | 326 | |||||
| Net cash used in operating activities | (18,724 | ) | (14,408 | ) | |||
| Investing activities: | |||||||
| Purchases of short-term investments | (995 | ) | (64,928 | ) | |||
| Maturities of short-term investments | 23,301 | 12,500 | |||||
| Purchase of property and equipment | (657 | ) | (559 | ) | |||
| Net cash provided by (used in) investing activities | 21,649 | (52,987 | ) | ||||
| Financing activities: | |||||||
| Proceeds from stock issued under employee stock purchase plan | 148 | 210 | |||||
| Proceeds from sale of common stock upon exercise of stock options | 31 | 37 | |||||
| Net cash provided by financing activities | 179 | 247 | |||||
| Net increase (decrease) in cash and cash equivalents | 3,104 | (67,148 | ) | ||||
| Cash and cash equivalents at beginning of period | 21,108 | 72,975 | |||||
| Cash and cash equivalents at end of period | $ | 24,212 | $ | 5,827 | |||
| Supplemental cash flow information: | |||||||
| Interest paid | $ | 307 | $ | 270 | |||
| Property and equipment in accounts payable | $ | 106 | $ | 96 | |||