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Senseonics Holdings, Inc. Reports Third Quarter 2019 Financial Results

November 12, 2019

GERMANTOWN, Md.--(BUSINESS WIRE)--Nov 12, 2019--

Senseonics Holdings, Inc. (NYSE American: SENS), a medical technology company focused on the development and commercialization of the first and only long-term, implantable continuous glucose monitoring (CGM) system for people with diabetes, today reported financial results for the quarter ended September 30, 2019.

Recent Highlights & Accomplishments:

“In the third quarter, we experienced growth in our covered lives, prescriber base and installed patient base,” said Tim Goodnow, PhD, President and Chief Executive Officer of Senseonics. “We will continue to focus on creating more access to our technology and addressing barriers through innovative initiatives to add to our patient and inserter base. We have now structured our workforce to focus on these commercial priorities and manage expenses to extend our cash runway. We are confident that our efforts to remove barriers to access combined with recent positive coverage decisions such as those from Humana, HCSC and Medicare will help accelerate market adoption in 2020 and in the future.”

Third Quarter 2019 Results:

In the third quarter of 2019, total revenue, net was $4.3 million, which includes U.S. net revenue of $0.5 million after accounting for gross to net reductions, primarily related to the Eversense Bridge Program and OUS net revenue of $3.8 million, compared to total revenue, net of $5.2 million for the third quarter of 2018. Gross revenue for the third quarter of 2019 was $5.9 million, including U.S. gross revenue of $2.1 million.

Third quarter 2019 gross profit decreased by $0.8 million year-over-year, to ($3.3) million. The decrease in gross profit was primarily due to lower revenue, net in our OUS region compared to the same period in the prior year.

Third quarter 2019 sales and marketing expenses increased by $3.7 million year-over-year, to $11.6 million. The increase was due primarily to the build out of the salesforce and commercialization efforts in the U.S.

Third quarter 2019 research and development expenses increased by $3.7 million year-over-year, to $11.1 million. The increase in research and development expenses was primarily driven by expenses associated with the 180-day PROMISE clinical study.

Third quarter 2019 general and administrative expenses increased by $0.3 million year-over-year, to $5.4 million.

Net loss was $19.5 million, or $0.10 per share, in the third quarter of 2019, compared to $31.9 million, or $0.18 per share, in the third quarter of 2018.

As of September 30, 2019, cash and cash equivalents were $130.6 million and outstanding indebtedness was $143.6 million. Over $100 million in gross proceeds were raised through a combination of borrowings under a term loan agreement and the issuance of convertible debt and equity in July 2019.

2019 Financial Outlook

Net revenue for full year 2019 (after accounting for the gross to net reductions primarily related to the Eversense Bridge Program) is now expected to be in the range of $20 to $22 million. This compares to the previous guidance of $25 to $30 million. Gross revenue is expected to be in the range of $25 to $27 million for full year 2019. A reconciliation of net revenue to gross revenue on a forward-looking basis is presented below under the heading “Reconciliation of Forecasted Revenue, Net to Forecasted Gross Revenue.”

Conference Call and Webcast Information

Company management will host a conference call at 4:30 pm (Eastern Time) today, November 12, 2019, to discuss these financial results and recent business developments. This conference call can be accessed live by telephone or through Senseonics’ website.

Live Teleconference Information:

Dial in number: 800-309-1256

Entry Number: 532764

International dial in: 786-789-4796

Live Webcast Information:

Visit http://www.senseonics.com and select the “ Investor Relations ” section

A replay of the call can be accessed on Senseonics’ website http://www.senseonics.com under “ Investor Relations.”

About Senseonics

Senseonics Holdings, Inc. is a medical technology company focused on the design, development and commercialization of transformational glucose monitoring products designed to help people with diabetes confidently live their lives with ease. Senseonics’ CGM systems, Eversense ® and Eversense ® XL, include a small sensor inserted completely under the skin that communicates with a smart transmitter worn over the sensor. The glucose data are automatically sent every 5 minutes to a mobile app on the user’s smartphone.

Non-GAAP Financial Measures

In accordance with U.S. GAAP, Senseonics reports revenue in its financial statements on a net basis, which takes into account gross to net reductions resulting from discount programs, such as the Eversense Bridge Program. To supplement its condensed consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP and present total revenue, net, Senseonics is also providing investors with gross revenue and U.S. gross revenue. These measures do not reflect the gross to net reductions from these discount programs and, accordingly, may be considered to be non-GAAP financial measures. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP, and Senseonics’ non-GAAP measures may be different from non-GAAP measures used by other companies.

Senseonics uses these non-GAAP financial measures for financial and operational decision-making. Senseonics’ management believes that these non-GAAP financial measures provide meaningful supplemental information regarding Senseonics’ performance and provide better transparency on the impact of reimbursement and the Eversense Bridge Program. Senseonics believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing Senseonics’ performance and when planning, forecasting, and analyzing future periods. For more information on these non-GAAP financial measures, please see the reconciliation of these non-GAAP financial measures to their nearest comparable GAAP measures at the end of this press release.

Forward Looking Statements

Any statements in this press release about future expectations, plans and prospects for Senseonics, including statements about Senseonics’ revenue trajectory, reducing the dependence on the Eversense Bridge Program, Senseonics’ growth, Senseonics’ projected net revenue and gross revenue for full year 2019, the ongoing commercialization of Eversense and the potential life-enhancing benefits Eversense offers people with diabetes, the effect of efforts to increase market adoption, the impact of coverage decisions, and other statements containing the words “believe,” “expect,” “intend,” “may,” “projects,” “will,” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: uncertainties in the development and regulatory approval processes, uncertainties inherent in the commercial launch and commercial expansion of the product, and such other factors as are set forth in the risk factors detailed in Senseonics’ Annual Report on Form 10-K for the year ended December 31, 2018, Senseonics’ Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, and Senseonics’ other filings with the SEC under the heading “Risk Factors.” In addition, the forward-looking statements included in this press release represent Senseonics’ views as of the date hereof. Senseonics anticipates that subsequent events and developments will cause Senseonics’ views to change. However, while Senseonics may elect to update these forward-looking statements at some point in the future, Senseonics specifically disclaims any obligation to do so except as required by law. These forward-looking statements should not be relied upon as representing Senseonics’ views as of any date subsequent to the date hereof.

Senseonics Holdings, Inc.

 

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

September 30,

 

December 31,

 

 

 

2019

 

2018

 

 

 

 

 

 

 

 

 

 

(unaudited)

 

 

 

 

Assets

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

 

130,580

 

 

$

 

136,793

 

 

Accounts receivable

 

 

2,800

 

 

 

830

 

 

Accounts receivable - related parties

 

 

3,468

 

 

 

6,267

 

 

Inventory, net

 

 

19,862

 

 

 

10,231

 

 

Prepaid expenses and other current assets

 

 

4,862

 

 

 

3,985

 

 

Total current assets

 

 

161,572

 

 

 

158,106

 

 

 

 

 

 

 

 

 

 

Deposits and other assets

 

 

3,108

 

 

 

117

 

 

Property and equipment, net

 

 

2,366

 

 

 

1,750

 

 

Total assets

 

$

 

167,046

 

 

$

 

159,973

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders’ Equity

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

 

$

 

3,253

 

 

$

 

4,407

 

 

Accrued expenses and other current liabilities

 

 

18,705

 

 

 

13,851

 

 

Deferred revenue

 

 

 

 

628

 

 

Term Loans, current portion

 

 

 

 

10,000

 

 

Total current liabilities

 

 

21,958

 

 

 

28,886

 

 

 

 

 

 

 

 

 

 

Term Loans, net of discount and current portion

 

 

43,092

 

 

 

4,783

 

 

2023 Notes, net of discount

 

 

11,529

 

 

 

36,103

 

 

2025 Notes, net of discount

 

 

35,668

 

 

 

 

Derivative liabilities

 

 

26,988

 

 

 

17,091

 

 

Other liabilities

 

 

2,464

 

 

 

1,849

 

 

Total liabilities

 

 

141,699

 

 

 

88,712

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

 

 

Common stock, $0.001 par value per share; 450,000,000 shares authorized; 203,365,624 and 176,918,381 shares issued and outstanding as of September 30, 2019 and December 31, 2018

 

 

203

 

 

 

177

 

 

Additional paid-in capital

 

 

462,876

 

 

 

428,878

 

 

Accumulated deficit

 

 

(437,732

)

 

 

(357,794

)

 

Total stockholders' equity

 

 

25,347

 

 

 

71,261

 

 

Total liabilities and stockholders’ equity

 

$

 

167,046

 

 

$

 

159,973

 

 

Senseonics Holdings, Inc.

 

Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss

(in thousands, except share and per share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2019

 

2018

 

2019

 

2018

 

Revenue, net

 

$

 

959

 

 

$

 

837

 

 

$

 

3,678

 

 

$

 

1,768

 

 

Revenue, net - related parties

 

 

3,360

 

 

 

4,321

 

 

 

8,671

 

 

 

9,960

 

 

Total revenue

 

 

4,319

 

 

 

5,158

 

 

 

12,349

 

 

 

11,728

 

 

Cost of sales

 

 

7,659

 

 

 

7,742

 

 

 

23,552

 

 

 

14,889

 

 

Gross profit

 

 

(3,340

)

 

 

(2,584

)

 

 

(11,203

)

 

 

(3,161

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing expenses

 

 

11,560

 

 

 

7,851

 

 

 

38,573

 

 

 

17,469

 

 

Research and development expenses

 

 

11,076

 

 

 

7,402

 

 

 

28,688

 

 

 

23,805

 

 

General and administrative expenses

 

 

5,388

 

 

 

5,138

 

 

 

17,321

 

 

 

14,531

 

 

Operating loss

 

 

(31,364

)

 

 

(22,975

)

 

 

(95,785

)

 

 

(58,966

)

 

Other income (expense), net:

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

519

 

 

 

820

 

 

 

1,556

 

 

 

1,245

 

 

Loss on extinguishment of debt

 

 

(398

)

 

 

 

 

(398

)

 

 

 

Interest expense

 

 

(3,460

)

 

 

(2,170

)

 

 

(7,459

)

 

 

(6,177

)

 

Debt issuance costs

 

 

(3,344

)

 

 

 

 

(3,344

)

 

 

 

Change in fair value of derivative liabilities

 

 

19,186

 

 

 

(7,513

)

 

 

26,147

 

 

 

(22,526

)

 

Other expense

 

 

(638

)

 

 

(43

)

 

 

(655

)

 

 

(226

)

 

Total other income (expense), net

 

 

11,865

 

 

 

(8,906

)

 

 

15,847

 

 

 

(27,684

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss

 

 

(19,499

)

 

 

(31,881

)

 

 

(79,938

)

 

 

(86,650

)

 

Total comprehensive loss

 

$

 

(19,499

)

 

$

 

(31,881

)

 

$

 

(79,938

)

 

$

 

(86,650

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per common share

 

$

 

(0.10

)

 

$

 

(0.18

)

 

$

 

(0.43

)

 

$

 

(0.57

)

 

Basic and diluted weighted-average shares outstanding

197,223,419

 

176,332,575

 

 

 

183,804,257

 

 

 

150,866,978

 

Senseonics Holdings, Inc.

 

Reconciliation of Total Revenue, Net to Gross Revenue

(in thousands)

 

 

For the Three Months Ended
September 30, 2019

For the Nine Months Ended
September 30, 2019

Revenue, net

$

4,319

$

12,349

Gross to net reductions

 

1,604

 

3,178

Gross revenue

$

5,923

$

15,527

Senseonics Holdings, Inc.

 

Reconciliation of U.S. Revenue, Net to U.S. Gross Revenue

(in thousands)

 

 

For the Three Months Ended
September 30, 2019

For the Nine Months Ended
September 30, 2019

U.S. Revenue, net

$

527

$

2,441

Gross to net reductions

 

1,604

 

3,178

U.S. Gross revenue

$

2,131

$

5,619

Senseonics Holdings, Inc.

 

Reconciliation of Forecasted Revenue, Net to Forecasted Gross Revenue

(in millions)

 

 

Year Ending December 31, 2019

Revenue, net

$ 20.0 – 22.0

Gross to net reductions

4.0 – 6.0

Gross revenue

$ 25.0 – 27.0

 

 

View source version on businesswire.com:https://www.businesswire.com/news/home/20191112006013/en/

CONTACT: Investor Contact

Lynn Lewis or Philip Taylor

Investor Relations

415-937-5406

Investors@senseonics.com

KEYWORD: MARYLAND UNITED STATES NORTH AMERICA

INDUSTRY KEYWORD: DATA MANAGEMENT HEALTH MEDICAL DEVICES DIABETES TECHNOLOGY MOBILE/WIRELESS SOFTWARE

SOURCE: Senseonics Holdings, Inc.

Copyright Business Wire 2019.

PUB: 11/12/2019 04:05 PM/DISC: 11/12/2019 04:06 PM

http://www.businesswire.com/news/home/20191112006013/en