ReWalk Robotics, Yokneam Ilit, Israel, and Marlborough, Massachusetts, announced its third quarter (3Q) and nine-month financial results for the period ending September 30, 2014.
3Q highlights include the following:
- Total revenue increased 277 percent to $1.5 million compared to $408,000 for 3Q 2013 resulting from the sale of 26 ReWalk systems.
- Net loss was $6.4 million, or a decrease of $2.81 per basic and diluted share, compared to a net loss of $3.3 million or a decrease of $19.52 per basic and diluted share for 3Q 2013.
- Non-GAAP [generally accepted accounting principles] net loss was $3.5 million, or a decrease of $1.34 per basic and diluted share, compared to a non-GAAP net loss of $2.2 million, or a decrease of $11.91 per basic and diluted share for 3Q 2013, mainly due to investment in research and development and sales and marketing resources.
- The company raised $38.7 million (net) through an initial public offering (IPO), increasing liquidity to fund commercialization of the ReWalk personal system in the United States, expand infrastructure, and continue research and development;
- According to Larry Janiski, CEO, the U.S. Food and Drug Administration (FDA) clearance to market ReWalk systems for personal and rehabilitation use to people with paragplegia due to spinal cord injury and limited decisions in the United States and Germany to provide third-party reimbursement for the powered exoskeleton had a favorable impact on the financials in 3Q 2014. Gross profit improved to $331,000 as compared to a gross loss of $20,000 in 3Q 2013, reflecting higher sales in the 2014 period coupled with manufacturing economies of scale. All ReWalk systems sold in 3Q 2014 consisted of systems purchased from Sanmina.
- Total operating expenses in 3Q 2014 were $8.1 million, compared with $2.2 million in 3Q 2013. The increase reflects non-cash share-based compensation expenses of $4.5 million in 3Q 2014 and incremental investment in sales, marketing, and research and development resources. Excluding non-cash share-based compensation expenses, total operating expenses were $3.6 million during 3Q 2014.
- Operating loss was $7.8 million for 3Q 2014 compared with $2.2 million during the prior year quarter. Non-GAAP operating loss, excluding non-cash share-based compensation expenses, was $3.3 million for 3Q 2014.
- Net loss was $6.4 million for 3Q 2014 compared with $3.3 million in the prior year quarter. Non-GAAP net loss for 3Q 2014 was $3.5 million compared with non-GAAP net loss of $2.2 million in the prior year quarter.
Nine-month financial highlights are as follows:
- Total revenues were $2.5 million for the nine months ended September 30, up 106 percent compared with $1.2 million during the nine months ended September 30, 2013, due to higher sales of ReWalk systems during the 2014 period. In the 2014 nine-month period, 42 ReWalk systems were sold compared with 19 ReWalk systems sold during the same period in 2013.
- Gross profit improved to a loss of $92,000 as compared to a loss of $297,000 for the nine months ended September 30, 2013, reflecting higher sales in the 2014 period coupled with manufacturing economies of scale. For the nine months ended September 30, 2014, cost of revenues consisted primarily of ReWalk systems purchased from Sanmina, as well as expenses related to the transition of our manufacturing activities to Sanmina. For the nine months ended September 30, 2013, cost of revenues consisted primarily of ReWalk systems manufactured by the company directly.
- Total operating expenses during the nine months ended September 30, 2014, were $14.6 million compared with $5.7 million in the prior year period, reflecting non-cash share-based compensation expenses of $4.9 million in the nine months ended September 30, 2014, and increased investment in sales, marketing, and research and development resources. Excluding the non-cash share-based compensation expenses, total operating expenses were $9.7 million compared with $5.6 million in the prior year period.
- Operating loss for the nine months ended September 30, 2014, was $14.6 million compared with $6.0 million during the prior year period. Excluding non-cash compensation expenses, operating loss was $9.8 million for the nine months ended September 30, 2014, compared with $5.9 million during the nine months ended September 30, 2013.
- Net loss for the nine months ended September 30 was $16.2 million compared with $8.7 million during the nine months ended September 30, 2013. Non-GAAP net loss was $10.1 million for the nine months ended September 30, 2014, compared with non-GAAP net loss of $6.0 million during the nine months ended September 30, 2013.
As of September 30, 2014, ReWalk had $47.7 million in cash and cash equivalents and short-term deposits. During the three months ended September 30, 2014, the company raised $38.7 million, net, from the IPO, $12.8 million from a pre-IPO financing round, and $1.1 million from the exercise of warrants to purchase convertible preferred shares.
Cash used in operating activities was $5.8 million and $12.6 million during the three- and nine-month periods ended September 30, respectively, compared with $2.2 million and $6.1 million in the respective prior year periods.
