Nuwellis, Inc. (Nasdaq: NUWE), a medical technology company focused
on transforming the lives of people with fluid overload, today
reported financial results for the fourth quarter and full year
ended December 31, 2023.
Highlights:
- Record quarter revenue of $2.6
million, a 9% increase over prior-year period. Full year revenue of
$8.9 million, a 4% increase over 2022.
- Fourth quarter pediatric revenue
grew 35% year over year; 28% increase in utilization and a 49%
increase in console sales. Four new pediatric accounts.
- Fourth quarter gross margin of
54.4%. Full year 2023 gross margin of 56.2%, a 56-basis point
increase over full year 2022.
- Added two products: The new 12 cm
dELC catheter and the Quelimmune™ SCD pediatric device.
- New clinical case series expands
the use of Aquadex® into end-stage liver disease.
- New real-world clinical data
continues to show Aquadex clinical evidence benefits pediatric
patients.
- Nuwellis hosted a symposium on
March 4 at the Technology and Heart Failure Therapeutics (THT)
conference, where two late breaking clinical trials and one lecture
session will be presented on the Aquadex system.
“Nuwellis continues to execute on its strategic
growth initiatives, with the highest total quarter of organic
revenue in company history,” said Nestor Jaramillo, President and
CEO of Nuwellis. “Led by Pediatrics, which saw steady increases in
existing console utilization and new account openings expanded
Aquadex market penetration. We expect our accelerating momentum to
continue in 2024, with further support from our growing body of
clinical evidence, paving the way for new Aquadex applications such
as in end-stage liver disease, as well as new product
introductions.”
Nuwellis announced the FDA HDE approval for
Quelimmune, received by its exclusive U.S. license and distribution
partner, SeaStar, further bolstering its pediatric portfolio for
Nuwellis’ fast-growing customer category and foundation for growth.
Additionally, the introduction of Nuwellis’ recently FDA cleared
specialty dual lumen 12 cm catheter will provide clinicians with an
additional venous access option to use the company’s Aquadex
ultrafiltration system. The company also announced a new clinical
case series featured in Clinical Transplantation demonstrating the
use of Aquadex to safely and effectively remove fluid volume for
end-stage liver disease patients, representing an additional
clinical application for Aquadex already within its current FDA
labeling. In this case series, Aquadex was shown to reduce
cirrhosis-related frailty and enhanced patients’ ability to receive
a life-saving liver transplant. Finally, the company announced new
real-world data featured in Pediatric Nephrology that showed the
proprietary hematocrit sensor within the Aquadex system facilitated
guided therapy of fluid overloaded pediatric patients without
hemodynamic instability or other complications.
“We overcame challenges like hospital budgetary
constraints and nursing shortages in the first half of 2023,
achieving 27% revenue growth in the second half of 2023 versus the
first half of 2023,” added Mr. Jaramillo. “We've confidently
transitioned beyond prior headwinds and anticipate a strong revenue
year in 2024, marked by achieving key milestones including the
three podium presentations at the THT conference, one of which
establishes the clinical superiority of Aquadex over diuretics, new
products for our existing pediatric customers, completion of the
DaVita Pilot phase, and the IDE submission for our pediatric
dedicated renal disease device branded Vivian. We are balancing the
multiple growth catalysts mentioned above with the need to raise
capital this year. We have recently undertaken steps to reduce our
monthly cash burn rate by approximately 40%, balanced against our
strategic growth initiatives, which will provide more flexibility
in anticipation of tougher capital market conditions for microcap
companies like Nuwellis.”
Fourth Quarter 2023 Financial
Results
Revenue for the fourth quarter of 2023 was $2.6
million, a 9% increase compared to $2.3 million in the prior-year
period. The year over year increase is attributable to an increase
in disposable utilization and record international sales.
Gross margin was 54.4% for the fourth quarter of
2023, compared to 56.9% in the prior-year period, a decrease of 250
basis points. The decline was due to product and geographical sales
mix and lower fixed overhead manufacturing absorption, leading to
more efficient inventory levels.
Selling, general and administrative expenses for
the fourth quarter of 2023 were $3.6 million, compared to $4.7
million in the prior-year period. The decrease in SG&A expenses
was primarily due to reduced headcount and related compensation
expense.
Fourth quarter research and development expenses
were $1.4 million, compared to $1.2 million in the prior-year
period, reflecting a modest increase in R&D spend related to
the development of our new pediatric dedicated CRRT device as we
approach IDE submission.
In the current year period, the company recorded
a non-recurring expense reduction of approximately $800 thousand,
reducing incentive compensation, impacting both SG&A and
R&D. Additionally, the company recorded a $550 thousand
SG&A expense, in the current year period, for contractual spend
related to the SeaStar license and distribution agreement.
Total operating expenses for the fourth quarter
of 2023 were $5.0 million, a 15% decrease compared to $5.9 million
in the prior-year period. The $884 thousand decrease was due to
cost saving measures implemented early in the second half of the
year and carried through year-end 2023 as we continue to drive
operating efficiencies.
Operating loss for the fourth quarter of 2023
was $3.6 million compared to an operating loss of $4.5 million in
the prior year period, resulting in a $941 thousand period over
period reduction.
Net loss attributable to common shareholders for
the fourth quarter of 2023 was $7.9 million, or a loss of $2.24 per
basic and diluted common share, compared to a net loss attributable
to common shareholders of $1.9 million, or a loss of $5.00 per
basic and diluted common share in the prior-year period. The
current period net loss attributable to common shareholders
includes $2.0 million of ‘Other Expense’ and $2.4 million of a
deemed dividend and PIK dividend related to the Company’s October
2023 financing. The prior year period net loss attributable to
common shareholders includes $2.6 million of ‘Other Income’ related
to the Company’s October 2022 financing.
At December 31, 2023, the Company had no debt,
cash and cash equivalents of approximately $3.8 million, and
approximately 5.7 million common shares outstanding.
Webcast and Conference Call
Information
The Company will host a conference call and
webcast at 9:00 AM ET today to discuss its financial results and
provide an update on the Company’s performance.
To access the live webcast, please visit the
Investors page of the Nuwellis website at https://ir.nuwellis.com.
Alternatively, you may access the live conference call by dialing
1-833-816-1404 (U.S) or 1-412-317-0497 (international) and using
the conference ID: 10185035. An audio archive of the webcast will
be available following the call on the Investors page at
https://ir.nuwellis.com.
About Nuwellis
Nuwellis, Inc. (Nasdaq: NUWE) is a medical
technology company dedicated to transforming the lives of patients
suffering from fluid overload through science, collaboration, and
innovation. The company is focused on commercializing the Aquadex
SmartFlow® system for ultrafiltration therapy. Nuwellis is
headquartered in Minneapolis, with a wholly owned subsidiary in
Ireland. For more information visit ir.nuwellis.com or visit us on
LinkedIn or X.
About the Aquadex SmartFlow®
System The Aquadex SmartFlow system
delivers clinically proven therapy using a simple, flexible and
smart method of removing excess fluid from patients suffering from
hypervolemia (fluid overload). The Aquadex SmartFlow system is
indicated for temporary (up to 8 hours) or extended (longer than 8
hours in patients who require hospitalization) use in adult and
pediatric patients weighing 20 kg or more whose fluid overload is
unresponsive to medical management, including diuretics. All
treatments must be administered by a health care provider, within
an outpatient or inpatient clinical setting, under physician
prescription, both having received training in extracorporeal
therapies.
Forward-Looking
StatementsCertain statements in this release may be
considered forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including without
limitation, statements regarding the new market opportunities and
anticipated growth in 2024 and beyond. Forward-looking statements
are predictions, projections and other statements about future
events that are based on current expectations and assumptions and,
as a result, are subject to risks and uncertainties. Many factors
could cause actual future events to differ materially from the
forward-looking statements in this release, including, without
limitation, those risks associated with our ability to execute on
our commercialization strategy, the possibility that we may be
unable to raise sufficient funds necessary for our anticipated
operations, our post-market clinical data collection activities,
benefits of our products to patients, our expectations with respect
to product development and commercialization efforts, our ability
to increase market and physician acceptance of our products,
potentially competitive product offerings, intellectual property
protection, our ability to integrate acquired businesses, our
expectations regarding anticipated synergies with and benefits from
acquired businesses, and other risks and uncertainties described in
our filings with the SEC. Forward-looking statements speak only as
of the date when made. Nuwellis does not assume any obligation to
publicly update or revise any forward-looking statements, whether
due to new information, future events or otherwise.
CONTACTS
INVESTORS: Vivian CervantesGilmartin Group
ir@nuwellis.com
NUWELLIS, INC. AND
SUBSIDIARYConsolidated Balance Sheets(in
thousands, except share and per share amounts) |
|
|
December 31,2023 |
|
|
|
December 31, 2022 |
|
ASSETS |
|
(unaudited) |
|
|
|
|
|
Current
assets |
|
|
|
|
|
|
|
Cash and cash equivalents |
$ |
3,800 |
|
|
$ |
17,737 |
|
Marketable securities |
|
— |
|
|
|
569 |
|
Accounts receivable |
|
1,951 |
|
|
|
1,406 |
|
Inventories, net |
|
1,997 |
|
|
|
2,661 |
|
Other current assets |
|
461 |
|
|
|
396 |
|
Total current
assets |
|
8,209 |
|
|
|
22,769 |
|
Property, plant and equipment, net |
|
728 |
|
|
|
980 |
|
Operating lease right-of-use asset |
|
713 |
|
|
|
903 |
|
Other assets |
|
120 |
|
|
|
21 |
|
TOTAL
ASSETS |
$ |
9,770 |
|
|
$ |
24,673 |
|
|
|
|
|
|
|
|
|
LIABILITIES,
CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
$ |
2,380 |
|
|
$ |
2,245 |
|
Accrued compensation |
|
525 |
|
|
|
2,161 |
|
Current portion of operating lease liability |
|
216 |
|
|
|
196 |
|
Current portion of finance lease liability |
|
— |
|
|
|
28 |
|
Other current liabilities |
|
51 |
|
|
|
58 |
|
Total current
liabilities |
|
3,172 |
|
|
|
4,688 |
|
Common stock warrant liability |
|
2,843 |
|
|
|
6,868 |
|
Operating lease liability |
|
544 |
|
|
|
760 |
|
Total
liabilities |
|
6,559 |
|
|
|
12,316 |
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mezzanine
EquitySeries J Convertible Preferred Stock as of December
31, 2023 and December 31, 2022, par value $0.0001 per share;
authorized 600,000 and none, issued and outstanding 11,950 and
none, respectively |
|
221 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
Stockholders’
equity |
|
|
|
|
|
|
|
Series A junior participating
preferred stock as of December 31, 2023 and December 31, 2022, par
value $0.0001 per share; authorized 30,000 shares, none
outstanding |
|
— |
|
|
|
— |
|
Series F convertible preferred
stock as of December 31, 2023 and December 31, 2022, par value
$0.0001 per share; authorized 18,000 shares, issued and outstanding
127 shares |
|
— |
|
|
|
— |
|
Series I convertible preferred
stock as of December 31, 2023 and December 31, 2022, par value
$0.0001 per share; authorized 1,049,280, issued and outstanding
none and 1,049,280, respectively |
|
— |
|
|
|
— |
|
Preferred stock as of December
31, 2023 and December 31, 2022, par value$0.0001 per share;
authorized 39,802,000 shares, none outstanding |
|
— |
|
|
|
— |
|
Common stock as of December
31, 2023 and December 31, 2022, par value$0.0001 per share;
authorized 100,000,000 shares, issued and outstanding5,682,461 and
536,394, respectively |
|
1 |
|
|
|
— |
|
Additional paid-in
capital |
|
290,646 |
|
|
|
279,736 |
|
Accumulated other
comprehensive income: |
|
|
|
|
|
|
|
Foreign currency translation adjustment |
|
(31 |
) |
|
|
(18 |
) |
Unrealized gain on marketable securities |
|
— |
|
|
|
56 |
|
Accumulated deficit |
|
(287,626 |
) |
|
|
(267,417 |
) |
Total stockholders’
equity |
|
2,990 |
|
|
|
12,357 |
|
TOTAL LIABILITIES AND
STOCKHOLDERS’ EQUITY |
$ |
9,770 |
|
|
$ |
24,673 |
|
See notes to the consolidated financial
statements.
NUWELLIS, INC. AND SUBSIDIARYCondensed
Consolidated Statements of Operations and Comprehensive Loss (In
thousands, except weighted average shares outstanding and per share
amounts) |
|
|
Three months endedDecember
31, |
|
Twelve months endedDecember
31, |
|
|
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
(unaudited) |
|
|
(unaudited) |
|
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales |
$ |
2,551 |
|
$ |
2,339 |
|
|
$ |
8,864 |
|
|
$ |
8,543 |
|
Cost of goods sold |
|
1,163 |
|
|
1,008 |
|
|
|
3,881 |
|
|
|
3,788 |
|
Gross profit |
|
1,388 |
|
|
1,331 |
|
|
|
4,983 |
|
|
|
4,755 |
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
3,609 |
|
|
4,664 |
|
|
|
17,191 |
|
|
|
17,584 |
|
Research and development |
|
1,372 |
|
|
1,201 |
|
|
|
5,422 |
|
|
|
4,342 |
|
Total operating expenses |
|
4,981 |
|
|
5,865 |
|
|
|
22,613 |
|
|
|
21,926 |
|
Loss from operations |
|
(3,593 |
) |
|
(4,534 |
) |
|
|
(17,630 |
) |
|
|
(17,171) |
|
Other income (expense), net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income |
|
56 |
|
|
61 |
|
|
|
154 |
|
|
|
75 |
|
Financing expense |
|
(3,483) |
|
|
(9,247) |
|
|
|
(3,483 |
) |
|
|
(9,247) |
|
Change in fair value of warrant liability |
|
1,513 |
|
|
11,827 |
|
|
|
758 |
|
|
|
11,827 |
|
Loss before income taxes |
|
(5,507 |
) |
|
(1,893 |
) |
|
|
(20,201 |
) |
|
|
(14,516) |
|
Income tax expense |
|
(2 |
) |
|
(3 |
) |
|
|
(8 |
) |
|
|
(9) |
|
Net loss |
|
(5,509 |
) |
|
(1,896 |
) |
|
|
(20,209 |
) |
|
|
(14,525) |
|
Deemed dividend attributable to
Series J Convertible Preferred Stock |
|
(2,297) |
|
|
— |
|
|
|
(2,297) |
|
|
|
— |
|
Dividend on Series J Convertible
Preferred Stock |
|
(121) |
|
|
— |
|
|
|
(121) |
|
|
|
— |
|
Net loss attributable to common stockholders |
$ |
(7,927) |
|
$ |
(1,896) |
|
|
$ |
(22,627) |
|
|
$ |
(14,525) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted loss
per share |
$ |
(2.24) |
|
$ |
(5.00) |
|
|
$ |
(11.52) |
|
|
$ |
(83.55) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding – basic and diluted |
|
3,539,185 |
|
|
379,254 |
|
|
|
1,964,406 |
|
|
|
173,846 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
loss: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(5,509) |
|
$ |
(1,896) |
|
|
$ |
(20,209 |
) |
|
$ |
(14.525 |
) |
Unrealized gain (loss) on marketable securities |
|
— |
|
|
6 |
|
|
|
— |
|
|
|
80 |
|
Foreign currency translation adjustments |
|
(6) |
|
|
(7) |
|
|
|
(13) |
|
|
|
(7 |
) |
Total comprehensive
loss |
$ |
(5,515 |
) |
$ |
(1,897 |
) |
|
$ |
(22,222 |
) |
|
$ |
(14,452 |
) |
See notes to the consolidated financial
statements.
NUWELLIS, INC. AND
SUBSIDIARYConsolidated Statements of Cash
Flows(in thousands) |
|
|
For the years ended December
31, |
|
|
|
|
2023 |
|
|
|
2022 |
|
Operating Activities |
|
|
(unaudited) |
|
|
|
|
|
Net loss
|
|
|
$ |
(20,209 |
) |
|
$ |
(14,525 |
) |
Adjustments to reconcile net
loss to cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
Depreciation and
amortization |
|
|
|
362 |
|
|
|
372 |
|
Stock-based compensation
expense |
|
|
|
670 |
|
|
|
862 |
|
Change in fair value of warrant liability …………………………………………………… |
|
|
|
(758 |
) |
|
|
(11,827 |
) |
Financing expense ………………………………………………………………………… |
|
|
|
3,483 |
|
|
|
9,247 |
|
Net realized and unrealized gains on marketable securities
……………………………….. |
|
|
|
(65 |
) |
|
|
124 |
|
Changes in operating assets
and liabilities: |
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
|
|
(545 |
) |
|
|
(656 |
) |
Inventory |
|
|
|
697 |
|
|
|
140 |
|
Other current assets
|
|
|
|
(65 |
) |
|
|
(68 |
) |
Other assets and liabilities |
|
|
|
(7 |
) |
|
|
(96 |
) |
Accounts payable and accrued expenses
|
|
|
|
(1,500 |
) |
|
|
1,278 |
|
Net cash used in
operations
|
|
|
|
(17,937 |
) |
|
|
(15,149 |
) |
|
|
|
|
|
|
|
|
|
|
Investing
activities: |
|
|
|
|
|
|
|
|
|
Additions to intangible assets ……………………………………………………………... |
|
|
|
(99 |
) |
|
|
— |
|
Proceeds from sales of marketable securities
……………………………………………... |
|
|
|
578 |
|
|
|
14,850 |
|
Purchase of property and equipment ……………………………………………………… |
|
|
|
(149 |
) |
|
|
(122 |
) |
Net cash provided by
investing activities
|
|
|
|
330 |
|
|
|
14,728 |
|
|
|
|
|
|
|
|
|
|
|
Financing
activities: |
|
|
|
|
|
|
|
|
|
Proceeds from public stock offerings,
net |
|
|
|
2,109 |
|
|
|
9,449 |
|
Proceeds from Series J Preferred Stock and
Warrants….………………………………….. |
|
|
|
1,482 |
|
|
|
— |
|
Proceeds from the exercise of warrants…………………………….. ..…………………… |
|
|
|
120 |
|
|
|
— |
|
Payments on finance lease
liability |
|
|
|
(28 |
) |
|
|
(26 |
) |
Net cash provided by
financing activities
|
|
|
|
3,683 |
|
|
|
9,423 |
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate
changes on cash
|
|
|
|
(13 |
) |
|
|
(7 |
) |
Net increase in cash and cash
equivalents |
|
|
|
(13,937 |
) |
|
|
8,995 |
|
Cash and cash
equivalents—beginning of year
|
|
|
|
17,737 |
|
|
|
8,742 |
|
Cash and cash
equivalents—end of year
|
|
|
$ |
$3,800 |
|
|
$ |
17,737 |
|
|
|
|
|
|
|
|
|
|
|
Supplemental schedule
of non-cash activities |
|
|
|
|
|
|
|
|
|
Inventory transferred to property, plant and equipment |
|
|
$ |
41 |
|
|
$ |
42 |
|
Issuance of Common Stock for exercise of Series I Warrants |
|
|
$ |
7,623 |
|
|
$ |
— |
|
Issuance of Series J Preferred Stock for exercise of Warrants |
|
|
$ |
2,927 |
|
|
$ |
— |
|
Deemed dividend on Series J Preferred Stock |
|
|
$ |
2,297 |
|
|
$ |
— |
|
Series J Preferred Stock issued for payment in kind dividend |
|
|
$ |
121 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow
information |
|
|
|
|
|
|
|
|
|
Cash paid for income
taxes |
|
|
$ |
12 |
|
|
$ |
9 |
|
See notes to the consolidated financial
statements.
Newellis (NASDAQ:NUWE)
Historical Stock Chart
From May 2024 to Jun 2024
Newellis (NASDAQ:NUWE)
Historical Stock Chart
From Jun 2023 to Jun 2024