Second Quarter 2016 Highlights:
- Total revenue of
$19.7 million , up 34% year-over-year, compared to revenue of$14.8 million in the second quarter of 2015.- Flexitouch® revenue increased 34% year-over-year to
$16.9 million , from$12.6 million . - Revenue for other products, consisting of revenue from sales of the Company’s ACTitouch® and Entré™ Systems, increased 31% year-over-year, to
$2.8 million , from$2.2 million .
- Flexitouch® revenue increased 34% year-over-year to
- Operating income of
$1.8 million , or 9.1% of total revenue, compared to$0.2 million , or 1.5% of total revenue, in the second quarter of 2015. - Net income of
$1.0 million , compared to net income of$0.1 million in the prior year quarter.
Highlights Subsequent to Quarter-End:
- On
August 2, 2016 , the Company closed an initial public offering (IPO) of its common stock that resulted in the sale of 4,120,000 shares at a price of$10.00 per share. The Company received net proceeds from the IPO of approximately$35.8 million , after deducting underwriting discounts and offering expenses.
“We are pleased with our performance in the second quarter,” said
“We are delighted to have completed our IPO in July and are excited about the many opportunities ahead of us,” said
Second Quarter 2016 Financial Results:
Three Months Ended June 30, | Increase / Decrease | |||||||||||
(In thousands) | 2016 | 2015 | $ Change | % Change | ||||||||
Flexitouch System | $ | 16,892 | $ | 12,604 | $ | 4,288 | 34.0 | % | ||||
ACTitouch & Entré Systems | 2,837 | 2,167 | 670 | 30.9 | % | |||||||
Total Revenue: | $ | 19,729 | $ | 14,771 | $ | 4,958 | 33.6 | % | ||||
Total revenue increased
Gross profit increased
Operating expenses increased
Operating income increased
Net income increased $0.9 million year-over-year, to
Six-Months 2016 Financial Results:
Total revenue for the six months ended
Net income increased
As of
Fiscal Year 2016 Outlook:
For the full year 2016, the Company expects total revenue in the range of
About
Legal Notice Regarding Forward-Looking Statements:
This release contains forward-looking statements. Forward-looking statements are generally identifiable by the use of words like "may," "will," "should," "could," "expect," "anticipate," "estimate," "believe," "intend," or "project" or the negative of these words or other variations on these words or comparable terminology. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties outside of the Company’s control that can make such statements untrue, including, but not limited to, the adequacy of the Company’s liquidity to pursue its complete business objectives; the Company’s ability to obtain reimbursement from third party payers for its products; loss or retirement of key executives; adverse economic conditions or intense competition; loss of a key supplier; entry of new competitors and products; adverse federal, state and local government regulation; technological obsolescence of the Company’s products; technical problems with the Company’s research and products; the Company’s ability to expand its business through strategic acquisitions; the Company’s ability to integrate acquisitions and related businesses; price increases for supplies and components; and the inability to carry out research, development and commercialization plans. In addition, other factors that could cause actual results to differ materially are discussed in the Company’s filings with the
Tactile Systems Technology, Inc. | ||||||||||||||||
Condensed Consolidated Balance Sheets | ||||||||||||||||
June 30, | Pro Forma as of | December 31, | ||||||||||||||
2016 | June 30, 2016 | 2015 | ||||||||||||||
(In thousands, except share and per share data) | (unaudited) | (unaudited) | ||||||||||||||
Assets | ||||||||||||||||
Current assets | ||||||||||||||||
Cash and cash equivalents | $ | 6,719 | $ | 6,719 | $ | 7,060 | ||||||||||
Accounts receivable, net | 12,606 | 12,606 | 14,151 | |||||||||||||
Inventories | 5,945 | 5,945 | 5,781 | |||||||||||||
Deferred income taxes | 1,781 | 1,781 | 1,766 | |||||||||||||
Prepaid expenses | 434 | 434 | 602 | |||||||||||||
Total current assets | 27,485 | 27,485 | 29,360 | |||||||||||||
Property and equipment, net | 1,441 | 1,441 | 1,346 | |||||||||||||
Other assets | ||||||||||||||||
Patent costs, net | 2,356 | 2,356 | 2,489 | |||||||||||||
Medicare accounts receivable – long term | 1,787 | 1,787 | 2,039 | |||||||||||||
Deferred income taxes | 387 | 387 | 402 | |||||||||||||
Other non-current assets | 2,296 | 2,296 | 1,337 | |||||||||||||
Total other assets | 6,826 | 6,826 | 6,267 | |||||||||||||
Total assets | $ | 35,752 | $ | 35,752 | $ | 36,973 | ||||||||||
Liabilities and Stockholders’ Equity (Deficit) | ||||||||||||||||
Current liabilities | ||||||||||||||||
Accounts payable | $ | 4,353 | $ | 4,353 | $ | 3,336 | ||||||||||
Accrued payroll and related taxes | 1,987 | 1,987 | 3,355 | |||||||||||||
Accrued expenses | 1,092 | 9,192 | 916 | |||||||||||||
Future product royalties | 495 | 495 | 991 | |||||||||||||
Income taxes payable | — | — | 904 | |||||||||||||
Total current liabilities | 7,927 | 16,027 | 9,502 | |||||||||||||
Long-term liabilities | ||||||||||||||||
Deferred compensation | 193 | 193 | 193 | |||||||||||||
Total liabilities | 8,120 | 16,220 | 9,695 | |||||||||||||
Convertible preferred stock | ||||||||||||||||
Series B convertible preferred stock; $0.001 par value, 5,319,066 shares authorized and 2,733,468 shares issued and outstanding as of June 30, 2016 (unaudited) and December 31, 2015 and no shares authorized, issued or outstanding as of June 30, 2016 (pro forma) | 12,970 | — | 12,599 | |||||||||||||
Series A convertible preferred stock; $0.001 par value, 3,112,153 shares authorized, 3,108,589 shares issued and 3,061,488 shares outstanding as of June 30, 2016 (unaudited) and December 31, 2015 and no shares authorized, issued or outstanding as of June 30, 2016 (pro forma) | 20,980 | — | 20,328 | |||||||||||||
Stockholders’ equity (deficit) | ||||||||||||||||
Preferred stock; $0.001 par value, 50,000,000 shares authorized and no shares issued and outstanding as of June 30, 2016 (pro forma) | — | — | — | |||||||||||||
Common stock; $0.001 par value, 14,184,175 shares authorized and 3,414,137 shares issued and outstanding as of June 30, 2016 (unaudited) and 300,000,000 shares authorized and 12,625,376 shares issued and outstanding as of June 30, 2016 (pro forma) and 14,184,175 shares authorized and 3,222,902 shares issued and outstanding as of December 31, 2015 | 3 | 13 | 3 | |||||||||||||
Additional paid-in capital | — | 25,840 | — | |||||||||||||
Accumulated deficit | (6,321 | ) | (6,321 | ) | (5,652 | ) | ||||||||||
Total stockholders’ (deficit) equity | (6,318 | ) | 19,532 | (5,649 | ) | |||||||||||
Total liabilities and stockholders’ equity (deficit) | $ | 35,752 | $ | 35,752 | $ | 36,973 | ||||||||||
Tactile Systems Technology, Inc. | |||||||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||
June 30, | June 30, | ||||||||||||||||||
(In thousands, except share and per share data) | 2016 | 2015 | 2016 | 2015 | |||||||||||||||
Revenues, net | $ | 19,729 | $ | 14,771 | $ | 33,429 | $ | 24,892 | |||||||||||
Cost of goods sold | 5,324 | 4,401 | 9,135 | 7,373 | |||||||||||||||
Gross profit | 14,405 | 10,370 | 24,294 | 17,519 | |||||||||||||||
Operating expenses | |||||||||||||||||||
Sales and marketing | 7,598 | 5,929 | 14,879 | 11,098 | |||||||||||||||
Research and development | 1,049 | 1,011 | 2,029 | 1,828 | |||||||||||||||
Reimbursement, general and administrative | 3,966 | 3,202 | 7,380 | 5,849 | |||||||||||||||
Total operating expenses | 12,613 | 10,142 | 24,288 | 18,775 | |||||||||||||||
Income (loss) from operations | 1,792 | 228 | 6 | (1,256 | ) | ||||||||||||||
Other income (expense) | 5 | 3 | 10 | 15 | |||||||||||||||
Income (loss) before income taxes | 1,797 | 231 | 16 | (1,241 | ) | ||||||||||||||
Income tax expense (benefit) | 809 | 93 | 8 | (499 | ) | ||||||||||||||
Net income (loss) | 988 | 138 | 8 | (742 | ) | ||||||||||||||
Convertible preferred stock dividends | 509 | 466 | 1,023 | 926 | |||||||||||||||
Allocation of undistributed earnings to preferred stockholders | 302 | — | — | — | |||||||||||||||
Net income (loss) attributable to common stockholders | $ | 177 | $ | (328 | ) | $ | (1,015 | ) | $ | (1,668 | ) | ||||||||
Net income (loss) per common share attributable to common stockholders | |||||||||||||||||||
Basic | $ | 0.05 | $ | (0.12 | ) | $ | (0.30 | ) | $ | (0.61 | ) | ||||||||
Diluted | $ | 0.04 | $ | (0.12 | ) | $ | (0.30 | ) | $ | (0.61 | ) | ||||||||
Weighted-average common shares used to compute net income (loss) per common share attributable to common stockholders | |||||||||||||||||||
Basic | 3,406,420 | 2,808,004 | 3,349,873 | 2,724,320 | |||||||||||||||
Diluted | 4,846,327 | 2,808,004 | 3,349,873 | 2,724,320 | |||||||||||||||
Pro forma net income per common share attributable to common stockholders | |||||||||||||||||||
Basic | $ | — | |||||||||||||||||
Diluted | $ | — | |||||||||||||||||
Weighted-average shares used to compute pro forma net income per common share attributable to common stockholders | |||||||||||||||||||
Basic | 13,406,568 | ||||||||||||||||||
Diluted | 14,846,475 | ||||||||||||||||||
Tactile Systems Technology, Inc. | |||||||||||
Condensed Consolidated Statements of Cash Flows | |||||||||||
(Unaudited) | |||||||||||
Six months ended | |||||||||||
June 30, | |||||||||||
(In thousands) | 2016 | 2015 | |||||||||
Cash flows from operating activities | |||||||||||
Net income (loss) | $ | 8 | $ | (742 | ) | ||||||
Adjustments to reconcile net income (loss) to net cash flows used in operating activities: | |||||||||||
Depreciation and amortization | 437 | 411 | |||||||||
Deferred income taxes | — | (496 | ) | ||||||||
Stock-based compensation expense | 150 | 145 | |||||||||
Change in allowance for doubtful accounts | 300 | — | |||||||||
Changes in assets and liabilities | |||||||||||
Accounts receivable | 1,245 | 1,637 | |||||||||
Inventories | (164 | ) | (866 | ) | |||||||
Prepaid expenses and other non-current assets | (791 | ) | 37 | ||||||||
Medicare accounts receivable – long-term | 252 | (278 | ) | ||||||||
Accounts payable | 1,017 | 517 | |||||||||
Accrued payroll and related taxes | (1,368 | ) | (430 | ) | |||||||
Accrued expenses and income taxes payable | (728 | ) | (209 | ) | |||||||
Future product royalties | (496 | ) | (297 | ) | |||||||
Net cash used in operating activities | (138 | ) | (571 | ) | |||||||
Cash flows from investing activities | |||||||||||
Purchases of property and equipment | (393 | ) | (261 | ) | |||||||
Patent costs | (6 | ) | — | ||||||||
Net cash used in investing activities | (399 | ) | (261 | ) | |||||||
Cash flows from financing activities | |||||||||||
Payments on notes payable | — | (5 | ) | ||||||||
Proceeds from exercise of common stock options and warrants | 196 | 551 | |||||||||
Net cash provided by financing activities | 196 | 546 | |||||||||
Net change in cash and cash equivalents | (341 | ) | (286 | ) | |||||||
Cash and cash equivalents – beginning of period | 7,060 | 5,416 | |||||||||
Cash and cash equivalents – end of period | $ | 6,719 | $ | 5,130 | |||||||
Supplemental cash flow disclosure | |||||||||||
Cash paid for interest | $ | — | $ | — | |||||||
Cash paid for taxes | $ | 964 | $ | 212 | |||||||
Investor Inquiries:Mike Piccinino Managing DirectorWestwicke Partners (443) 213-0500 [email protected] Media Inquiries:Kristen Weaver Director ofMarketing Communications Tactile Medical (612) 355-5116