BELGRADE, Mont., Aug. 08, 2019 (GLOBE NEWSWIRE) — Xtant Medical Holdings, Inc. (NYSE American: XTNT), a global medical technology company focused on surgical solutions for the treatment of spinal disorders, today reported financial and operating results for the second quarter ended June 30, 2019.
Second Quarter 2019 Financial Highlights:
- Revenue for the second quarter of 2019 was $15.3 million, compared to $18.7 million for the same prior year period
- Operating expenses in the second quarter of 2019 were $10.5 million, compared to $14.7 million for the same prior year period
- Net loss incurred in the second quarter of 2019 was $1.9 million, compared to a net loss of $5.0 million for the same prior year period
- Non-GAAP Adjusted EBITDA for the second quarter of 2019 was $1.2 million, compared to $0.8 million for the same prior year period
Greg Jensen, VP, Finance and CFO of Xtant Medical, said, “Our efforts to reduce expenses while further enhancing the operational effectiveness of our business resulted in improved cash flow, net loss and adjusted EBITDA during the second quarter, despite softer revenues. We are taking measures designed to stabilize and improve our revenue trajectory, and we plan to implement additional initiatives to support this critical goal during the second half of 2019 and into 2020. These initiatives include a commitment to developing new products, further development and expansion of marketing programs, and continued pursuit of operational improvements intended to assist us in our overall commercial performance.”
Second Quarter 2019 Financial Results
Second quarter 2019 revenue was $15.3 million, compared to $18.7 million for the same period in 2018. This decrease was due primarily to reduced demand for hardware products, which was due in part to effects from the December 2018 recall of the Calix Lumbar Spine Implant System, the termination of an advisory agreement with an entity that provided services to certain customers, and transition of independent sales agents.
Gross margin for the second quarter of 2019 was 64.9%, compared to 66.6% for the same period in 2018. The year-over-year decrease was attributed primarily to inventory reserving and manufacturing overhead absorption.
Operating expenses for the second quarter of 2019 were $10.5 million, compared to $14.7 million for the second quarter of 2018, a decrease of 29.0%. The decrease was primarily attributable to lower sales commissions and travel expenses, restructuring expenses incurred last year, and a decrease in amortization expense related to the impairment of intangible assets that occurred in the fourth quarter of 2018.
Second quarter 2019 net loss was $1.9 million, or $0.15 per share, compared to second quarter 2018 net loss of $5.0 million, or $0.38 per share.
Non-GAAP Adjusted EBITDA for the second quarter of 2019 was $1.2 million compared to $0.8 million for the same period of 2018. The Company defines Adjusted EBITDA as net income/loss from operations before depreciation, amortization and interest expense, and as further adjusted to add back in or exclude, as applicable, non-cash special charges, provision for losses on inventory and accounts receivable, non-cash compensation, changes in warrant derivative liability, field action expenses, separation related expenses, litigation reserves, and restructuring expenses. A calculation and reconciliation of non-GAAP Adjusted EBITDA to net loss can be found in the attached financial tables.
Xtant Medical will host a webcast and conference call to discuss the second quarter 2019 financial results on Thursday, August 8, 2019 at 9:00 AM ET. To access the webcast, Click Here. To access the conference call, dial 877-407-6184 within the U.S. or 201-389-0877 outside the U.S. A replay of the call will be available at www.xtantmedical.com, under “Investor Info.”
About Xtant Medical Holdings, Inc.
Xtant Medical Holdings, Inc. (www.xtantmedical.com) is a global medical technology company focused on the design, development, and commercialization of a comprehensive portfolio of orthobiologics and spinal implant systems to facilitate spinal fusion in complex spine, deformity and degenerative procedures. Xtant people are dedicated and talented, operating with the highest integrity to serve our customers.
The symbols ™ and ® denote trademarks and registered trademarks of Xtant Medical Holdings, Inc. or its affiliates, registered as indicated in the United States, and in other countries. All other trademarks and trade names referred to in this release are the property of their respective owners.
Non-GAAP Financial Measures
To supplement the Company’s consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses certain non-GAAP financial measures in this release, including Adjusted EBITDA. Reconciliations of the non-GAAP financial measures used in this release to the most comparable GAAP measures for the respective periods can be found in tables later in this release. The Company’s management believes that the presentation of these measures provides useful information to investors. These measures may assist investors in evaluating the Company’s operations, period over period. Management uses the non-GAAP measures in this release internally for evaluation of the performance of the business, including the allocation of resources. Investors should consider non-GAAP financial measures only as a supplement to, not as a substitute for or as superior to, measures of financial performance prepared in accordance with GAAP.
Important Cautions Regarding Forward-looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as ‘‘expects,’’ ‘‘anticipates,’’ ‘‘intends,’’ ‘‘plans,’’ ‘‘believes,’’ ‘‘estimates,’’ “continue,” “future,” ‘‘will,’’ “potential” similar expressions or the negative thereof, and the use of future dates. The Company cautions that its forward-looking statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others: the Company’s future operating results and financial performance; the ability to increase or maintain revenue, including the success of the Company’s initiatives to stabilize and increase revenues; the ability to remain competitive; the ability to innovate and develop new products; the effect of recent management changes and the ability to engage and retain qualified personnel; government and third-party coverage and reimbursement for Company products; the ability to obtain and maintain regulatory approvals and comply with government regulations; the effect of product liability claims and other litigation to which the Company may be subject; the effect of product recalls and defects, including the recall of the Company’s Calix Lumbar Spine Implant System; timing and results of clinical studies; the ability to obtain and protect Company intellectual property and proprietary rights and operate without infringing the rights of others; the ability to retain and recruit independent sales agents and the impact of the termination of a consulting agreement with an entity that had close relationships with several of customers; the ability to service Company debt and comply with debt covenants; the ability to raise additional financing and other factors. Additional risk factors are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission (SEC) on April 1, 2019 and subsequent SEC filings by the Company, including without limitation its most recent Quarterly Report on Form 10-Q for the quarter ended June 30, 2019 anticipated to be filed with the SEC. Investors are encouraged to read the Company’s filings with the SEC, available at www.sec.gov, for a discussion of these and other risks and uncertainties. The Company undertakes no obligation to release publicly any revisions to any forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as required by law. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by this cautionary statement.