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TMCNet:  SpineGuard Reports Full-Year 2013 Financial Results

[March 25, 2014]

SpineGuard Reports Full-Year 2013 Financial Results

PARIS & SAN FRANCISCO --(Business Wire)--

SpineGuard (FR0011464452 - ALSGD), an innovative company that designs, develops and markets disposable bone-monitoring devices intended to make spine surgery safer, reported today its full-year 2013 financial results as approved by the Board of Directors on March 20, 2014.




€ thousands - IFRS Audited       Dec 31, 2013     Dec 31, 2012     ?
Revenue       4,615     3,877     +19%
Gross margin       4,027     3,346     +20%
Gross margin (% of revenue)       87.3%     86.3%      
Sales, distribution & marketing 4,761 4,201
Administrative costs 1,607 1,746
Research & Development 811 588
Other expenses - -
Operating profit / (loss)       -3,152     -3,189      
Pre-tax profit / (loss)       -3,515     -3,266      
Net profit / (loss)       -3,515     -3,266      
 

2013: revenue growth and better-than-expected operating result

In 2013, SpineGuard reported full-year revenue of €4,615 thousand compared to €3,877 thousand for the full-year 2012, a 20% CC increase. 6,308 PediGuard units were sold compared to 5,225 for the full year 2012, including 3,142 in the United States; 1,341 in Europe; 973 in Latin America; 616 in the Middle East; and 236 in Asia-Pacific.

The gross margin remained very solid over the year at 87.3%. It was stable compared to the previous six-month results and continues to reflect PediGuard's relatively low manufacturing costs, including for the recently-launched new versions (Cannulated PediGuard and the XS Range) whose manufacturing costs could be reduced as volumes grow.

SpineGuard's business model, driven by continuous improvement in its supply chain and distribution, enables the optimization of operating expenses, which totaled €7,179 thousand in 2013 compared to €6,535 thousand for the full-year 2012.

The above elements allowed the Company to record a stable and well-controlled operating loss of €3,152 thousand compared to a loss of €3,189 thousand a year ago.

The Company reported a net loss of €3,515 thousand for the full-year 2013 compared to a loss of €3,266 thousand for the full-year 2012, after an interest charge of €278 thousand and a foreign currency charge of €84 thousand.

Working capital was €322 thousand compared to €139 thousand for the full-year 2012, illustrating the low and atypical level of cash required compared to industry standards, notably with inventory levels being reduced to €436 thousand compared to €498 thousand for the full-year 2012.

At December 31, 2013, cash and cash equivalents were €6,395 thousand compared to €2,314 thousand at December 31, 2012.

Key events: positive news flow aligned with objectives

Regulatory approvals:

  • FDA 510(k) clearance in the USA for the new XS Classic and XS Curved PediGuard versions;
  • Regulatory "Ninsho" approval in Japan for the Classic and Curved versions, including XS;
  • Registration in Mexico for the Cannulated, Curved and XS Curved ranges;
  • Approval in Russia for the entire PediGuard bone-monitoring platform.

Commercial expansion:

  • An additional 20 agencies in the United States (giving a current total of 71);
  • Sales commenced in Russia, Japan, Chile, Ecuador, Turkey and Kuwait;
  • Change of distributor in Spain, Colombia and Australia;
  • United States - recruitment of an Area Sales Manager covering the West of the country and three Product Specialists (West, South and Northeast); promotion of the Area Sales Manager and Product Specialist covering the South of the country to Vice-President of US Sales and Area Sales Manager for the South, respectively. The US Sales & Marketing team now consists of 11 staff;
  • Recruitment of a Sales Manager for German-speaking countries, Northern Europe and India.

Surgeons education and clinical trials:

  • 19 teaching institutions in the United States have adopted the PediGuard in their curriculum (20% of spine surgery teaching institutions in the USA);
  • Undertaking of 4 prospective randomized studies aimed at proving the PediGuard's clinical superiority with a better placement of the screws, reduction in radiation and shorter operating time. These studies cover the following areas: thoracic (France), thoraco-lumbar (Germany), osteoporosis (United States, Brazil) and learning curve (United States).

Research and development:

  • Patents granted for the SmartScrew and for Directional Improvement in the United States;
  • Granting in China of the second part of the SmartScrew patent, following the granting of the first part in 2010;
  • Limited-series prelaunch of the Classic PediGuard XS and Curved PediGuard XS miniaturized versions;
  • Development of the Directional version of the Cannulated PediGuard;
  • New applications of the PediGuard® platform: development of drawings and prototypes of the Spine SmartScrew and drilling instruments for traumatology.

Recent events:

January 2:

      The Board of Directors resolved to ask the appointment of Pierre Guyot (CEO and Director of Mölnlycke Healthcare since 2007) as a Director at the next shareholders meeting.
 

January 24:

Set-up of a Standby Equity Facility (Paceo®) with Societe Generale.

 

February 20:

First drawdown on the Paceo for a total of €262 thousand, representing an increase of 25,000 issued shares and a total number of shares issued to date of 4,336,112.

 

Pierre Jérôme, CEO of SpineGuard, said: "We are really pleased with our financial and strategic performance in 2013. Our enhanced resources and visibility since the IPO are enabling us to exploit the amazing potential of our technology platform at a faster pace. The development of the PediGuard SmartScrew is well underway. We are convinced it represents a major breakthrough for patients undergoing back surgery. This project also offers particularly promising perspectives in traumatology, the fastest-growing orthopedic segment. These new applications are based on a solid clinical foundation and represent a true medium-term opportunity of growth for SpineGuard and its partners."

Next financial press release: 2014 half-year revenue: July 17, 2014

About SpineGuard

Founded in 2009 and based in Paris and San Francisco, SpineGuard is an innovative company that designs, develops and markets disposable bone-monitoring devices intended to make spine surgery safer. Its PediGuard® core technology allows orthopedic spine surgeons and neurosurgeons to insert pedicle screws with unparalleled accuracy. Equipped with a sensor at its tip and electronics in its handle, PediGuard® measures changes in the electrical conductivity of surrounding tissue in real time and alerts the surgeon using audio feedback and a flashing light. Several key clinical studies have established the reliability and accuracy of PediGuard® for pedicle screw placement, demonstrating significantly less radiation exposure of medical teams and shorter surgery time when it is used. The PediGuard® platform is protected by eight international patent families, approved and sold in 45 countries, CE Marked in Europe, and has received 510(k) clearance from the FDA in the United States. Over 30,000 surgical procedures have been performed worldwide using PediGuard®. The company was awarded "innovative business" status by Oséo in 2009.

For further information, please go to www.spineguard.fr.


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