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Press release content from Globe Newswire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

CareDx Reports Third Quarter 2021 Results; Increases Full Year Revenue Guidance

October 28, 2021 GMT

SOUTH SAN FRANCISCO, Calif., Oct. 28, 2021 (GLOBE NEWSWIRE) -- CareDx, Inc. (Nasdaq: CDNA), a leading precision medicine company focused on the discovery, development, and commercialization of clinically differentiated, high-value healthcare solutions for transplant patients and caregivers, today reported financial results for the third quarter ended September 30, 2021.

Recent Highlights:

  • Achieved record revenue of $75.6 million for the three months ended September 30, 2021, increasing 42% year-over-year
  • Grew testing services volume 86% year-over-year, with approximately 40,000 AlloSure and AlloMap patient results provided in the quarter - highlighted by an approximately 90% attach rate for HeartCare
  • Announced publication of KidneyCare validation study in Kidney360 – Multicenter study validating AlloMap and demonstrating the complementary value with AlloSure for detecting rejection
  • Received first commercial AlloSure Lung coverage, followed by commercial launch of AlloSure Lung, the first dd-cfDNA test available for lung transplant patients, in October

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“I’m pleased with our strong performance in the third quarter, driven by 86% volume growth in testing services,” said Reg Seeto, President and Chief Executive Officer of CareDx. “We made significant progress toward our goal of OrganCare multi-modality, while continuing our pan-organ leadership in being the first with dd-cfDNA in Heart, Kidney and now Lung. We remain 100% committed to patients, and to transforming the transplant patient journey through innovation.”

Third Quarter 2021 Financial Results

Revenue for the three months ended September 30, 2021 was $75.6 million, an increase of 42% compared with $53.4 million in the third quarter of 2020. Testing services revenue for the third quarter was $66.5 million, compared with $45.5 million in the same period of 2020. Product revenue in the three months ended September 30, 2021 was $6.5 million, compared to $5.4 million in the same period of 2020. Digital and other revenue for the third quarter of 2021 was $2.6 million.

For the third quarter of 2021, net loss was $11.9 million compared to a net loss of $2.8 million in the same period of 2020. Basic and diluted net loss per share was $0.23 in the third quarter of 2021, compared to basic and diluted net loss per share of $0.06 in the third quarter of 2020.

Non-GAAP net income was $4.0 million in the third quarter of 2021 compared to a $5.1 million non-GAAP net income in the third quarter of 2020. Diluted non-GAAP net income per share was $0.07 in the third quarter of 2021, compared to a diluted non-GAAP net income per share of $0.10 in the third quarter of 2020.

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Adjusted EBITDA for the third quarter of 2021 was a gain of $4.7 million, compared to an adjusted EBITDA of $5.6 million in the third quarter of 2020.

Cash, cash equivalents & marketable securities were $363.3 million as of September 30, 2021.

For additional information regarding non-GAAP financial measures discussed herein, please see “Use of Non-GAAP Financial Measures,” “Reconciliation of GAAP to Non-GAAP Financial Measures” and “Reconciliation of GAAP to Non-GAAP Adjusted EBITDA Financial Measures” below.

2021 Guidance

For the full year 2021, CareDx now expects revenue to be in the range of $290 million to $293 million (previously $280 million to $290 million).

About CareDx

CareDx, Inc., headquartered in South San Francisco, California, is a leading precision medicine solutions company focused on the discovery, development, and commercialization of clinically differentiated, high-value healthcare solutions for transplant patients and caregivers. CareDx offers testing services, products, and digital healthcare solutions along the pre- and post-transplant patient journey and is the leading provider of genomics-based information for transplant patients. For more information, please visit: www.CareDx.com.

Forward Looking Statements

This press release includes forward-looking statements, including expectations regarding the Company’s fiscal 2021 revenue, achievement of our financial and operational goals and our prospects. These forward-looking statements are based upon information that is currently available to CareDx and its current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, including general economic and market factors, among others discussed in CareDx’s filings with the SEC, including the Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed by CareDx with the SEC on February 24, 2021, and the periodic reports that CareDx has subsequently filed with the SEC. Any of these may cause CareDx’s actual results, performance or achievements to differ materially and adversely from those anticipated or implied by CareDx’s forward-looking statements. CareDx expressly disclaims any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements.

Use of Non-GAAP Financial Measures

CareDx has presented in this release certain financial information in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and also on a non-GAAP basis, including non-GAAP net income, non-GAAP basic and diluted net income per share and adjusted EBITDA. We define non-GAAP net income and per share results as the GAAP net income and per share results excluding the impacts of stock-based compensation; net unrealized gains and losses related to equity securities, changes in estimated fair value of warrants, derivative liabilities and contingent consideration; acquisition related impairment charges and amortization of intangible assets, purchase accounting adjustments and related tax effects; costs involved with completing an acquisition; amortization of debt discount; and certain other financing charges. We define adjusted EBITDA as non-GAAP net income/(loss) before net interest income/(expense), income tax benefit, depreciation and amortization, and other income and expense. We are presenting these non-GAAP financial measures to assist investors in assessing our operating results through the eyes of management and because we believe that these measures provide an additional tool for investors to use in comparing our core business operating results over multiple periods. Management believes this non-GAAP information is useful for investors, when considered in conjunction with CareDx’s GAAP financial statements, because management uses such information internally for its operating, budgeting and financial planning purposes. Non-GAAP information is not prepared under a comprehensive set of accounting rules and should only be used to supplement an understanding of CareDx’s operating results as reported under GAAP. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. These non-GAAP financial measures are not necessarily comparable to similarly-titled measures presented by other companies. A reconciliation between GAAP and non-GAAP financial information is provided immediately following the financial tables.

Investor Relations Contact

Ian Cooney
(415) 287-2300 x 3550
investor@caredx.com

CareDx, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share data)

   Three Months Ended
September 30,
  Nine Months Ended
September 30,
  2021 2020 2021 2020
Revenue:        
Testing services revenue $66,464   $45,529   $190,635   $113,264  
Product revenue 6,521   5,383   19,160   13,369  
Digital and other revenue 2,604   2,457   7,382   6,917  
Total revenue 75,589   53,369   217,177   133,550  
Operating expenses:        
Cost of testing services 18,038   11,900   51,756   30,631  
Cost of product 4,919   3,705   13,771   9,635  
Cost of digital and other 1,879   1,210   4,861   3,966  
Research and development 19,439   12,474   54,479   35,616  
Sales and marketing 21,370   13,870   56,421   37,727  
General and administrative 18,671   13,117   50,216   35,436  
Total operating expenses 84,316   56,276   231,504   153,011  
Loss from operations (8,727)  (2,907)  (14,327)  (19,461) 
Other income (expense):        
Interest income, net 20   29   147   146  
Change in estimated fair value of common stock warrant liability 88   79   50   (990) 
CARES Act Provider Relief Fund          4,813  
Other expense, net (3,440)  (254)  (906)  (572) 
Total other (expense) income (3,332)  (146)  (709)  3,397  
Loss before income taxes (12,059)  (3,053)  (15,036)  (16,064) 
Income tax benefit 162   235   525   865  
Net loss $(11,897)  $(2,818)  $(14,511)  $(15,199) 
Net loss per share:        
Basic $(0.23)  $(0.06)  $(0.28)  $(0.33) 
Diluted $(0.23)  $(0.06)  $(0.28)  $(0.33) 
Weighted-average shares used to compute net loss per share:        
Basic 52,681,451   49,010,680   52,034,450   45,526,810  
Diluted 52,681,451   49,010,680   52,034,450   45,526,810  

CareDx, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)

  September 30,
2021
  December 31,
2020
Assets   
Current assets:   
Cash and cash equivalents$353,082   $134,669  
Marketable securities10,199   90,034  
Accounts receivable56,181   34,624  
Inventory18,800   10,012  
Prepaid and other current assets6,413   3,758  
Total current assets444,675   273,097  
Property and equipment, net18,719   10,704  
Operating leases right-of-use assets18,316   15,228  
Intangible assets, net48,367   44,355  
Goodwill26,051   23,857  
Restricted cash210   270  
Other assets6,834   1,000  
Total assets$563,172   $368,511  
Liabilities and stockholders’ equity   
Current liabilities:   
Accounts payable$14,894   $9,653  
Accrued compensation24,243   18,466  
Accrued and other liabilities30,599   20,602  
Refund liability - CMS advance payment   20,496  
Total current liabilities69,736   69,217  
Deferred tax liability678   1,299  
Common stock warrant liability195   447  
Deferred payments for intangible assets2,084   3,560  
Operating lease liability, less current portion17,876   16,069  
Other liabilities456   240  
Total liabilities91,025   90,832  
Commitments and contingencies   
Stockholders’ equity:   
Common stock52   49  
Additional paid-in capital843,226   632,253  
Accumulated other comprehensive loss(4,093)  (2,096) 
Accumulated deficit(367,038)  (352,527) 
Total stockholders’ equity472,147   277,679  
Total liabilities and stockholders’ equity$563,172   $368,511  

CareDx, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
(In thousands)

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 2021 2020 2021 2020
Cost of testing services reconciliation:       
GAAP cost of testing services$18,038   $11,900   $51,756   $30,631   
Stock-based compensation expense(750)  (431)  (1,715)  (1,101) 
Acquisition related-amortization of purchased intangibles(329)  (329)  (987)  (987) 
Non-GAAP cost of testing services$16,959   $11,140   $49,054   $28,543   
Cost of product reconciliation:       
GAAP cost of product$4,919   $3,705   $13,771   $9,635   
Stock-based compensation expense(156)  (97)  (446)  (289) 
Acquisition related-amortization of purchased intangibles(480)  (445)  (1,434)  (1,210) 
Non-GAAP cost of product$4,283   $3,163   $11,891   $8,136   
Cost of digital and other reconciliation:       
GAAP cost of digital and other$1,879   $1,210   $4,861   $3,966   
Stock-based compensation expense(217)  (124)  (555)  (338) 
Acquisition related-amortization of purchased intangibles(209)  (86)  (458)  (259) 
Non-GAAP cost of digital and other$1,453   $1,000   $3,848   $3,369   
Research and development expenses reconciliation:       
GAAP research and development expenses$19,439   $12,474   $54,479   $35,616   
Stock-based compensation expense(1,986)  (1,224)  (5,284)  (3,490) 
Non-GAAP research and development expenses$17,453   $11,250   $49,195   $32,126   
Sales and marketing expenses reconciliation:       
GAAP sales and marketing expenses$21,370   $13,870   $56,421   $37,727   
Stock-based compensation expense(3,853)  (1,623)  (8,144)  (4,175) 
Acquisition related-amortization of purchased intangibles(502)  (376)  (1,344)  (1,089) 
Non-GAAP sales and marketing expenses$17,015   $11,871   $46,933   $32,463   
General and administrative expenses reconciliation:       
GAAP general and administrative expenses$18,671   $13,117   $50,216   $35,436   
Stock-based compensation expense(3,677)  (3,249)  (10,439)  (8,031) 
Change in estimated fair value of contingent consideration(156)  (35)  35   (301) 
Acquisition related fees and expenses(485)     (866)    
Non-GAAP general and administrative expenses$14,353   $9,833   $38,946   $27,104   
Total other income (expense) reconciliation:       
GAAP other income (expense), net$(3,332)  $(146)  $(709)  $3,397   
Unrealized loss on long-term marketable equity securities3,257      167     
Change in estimated fair value of common stock warrant liability(88)  (79)  (50)  990  
Accretion of liability55   80   199   272  
Non-GAAP other (expense) income, net$(108)  $(145)  $(393)  $4,659   
Income tax benefit reconciliation:       
GAAP income tax benefit$162   $235   $525   $865   
Tax effect related to amortization of purchased intangibles(122)  (130)  (373)  (369) 
Non-GAAP income tax benefit$40   $105   $152   $496   

CareDx, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(Unaudited)
(In thousands, except share and per share data)

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 2021 2020 2021 2020
        
Net loss$(11,897)  $(2,818)  $(14,511)  $(15,199) 
Stock-based compensation expense10,639   6,748   26,583   17,424  
Unrealized loss on long-term marketable equity securities3,257      167     
Acquisition related-amortization of purchased intangibles1,520   1,236   4,223   3,545  
Acquisition related fees and expenses485      866     
Change in estimated fair value of contingent consideration156   35   (35)  301  
Change in estimated fair value of common stock warrant liability(88)  (79)  (50)  990  
Accretion of liability55   80   199   272  
Tax effect related to amortization of purchased intangibles(122)  (130)  (373)  (369) 
Non-GAAP net income$4,005   $5,072   $17,069   $6,964  
        
GAAP basic and diluted net loss per share$(0.23)  $(0.06)  $(0.28)  $(0.33) 
        
Non-GAAP basic net income per share$0.08   $0.10   $0.33   $0.15  
Non-GAAP diluted net income per share$0.07   $0.10   $0.31   $0.15  
        
Shares used in computing non-GAAP basic net income per share52,681,451   49,010,680   52,034,450   45,526,810  
Shares used in computing non-GAAP diluted net income per share54,584,822   50,446,939   54,454,433   46,571,527  

CareDx, Inc.
Reconciliation of Non-GAAP to Adjusted EBITDA Financial Measures
(Unaudited)
(In thousands)

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
 2021 2020 2021 2020
        
Non-GAAP net income$4,005   $5,072   $17,069   $6,964  
Interest income(20)  (29)  (147)  (146) 
Income tax benefit(40)  (105)  (152)  (496) 
Depreciation expense624   486   1,879   1,235  
CARES Act Provider Relief Fund         (4,813) 
Other expense, net128   174   540   300  
Adjusted EBITDA$4,697   $5,598   $19,189   $3,044