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Accelerate Diagnostics Reports Fourth Quarter and Full-Year 2021 Financial Results

TUCSON, Ariz., March 8, 2022 /PRNewswire/ -- Accelerate Diagnostics, Inc. (Nasdaq: AXDX) today announced financial results for the fourth quarter and full year ended December 31, 2021.

Jack Phillips, Chief Executive Officer of Accelerate Diagnostics, Inc., commented, "The addition of new contracts, clinically live customers, and new prospects to our sales funnel, made the fourth quarter our most commercially productive quarter of the year.  Strong R&D execution in 2021 has enabled the sale and early marketing of our expanded product portfolio.  The new PhenoAST Test Kit is being well received in the market, and customer interest for Accelerate Arc is accelerating ahead of our launch later this month.  We expect continued improvement in our level of commercial activity on the back of strong interest in these new products and an improved hospital environment in 2022."

Fourth Quarter 2021 Highlights

  • Added 16 contracted instruments in the quarter and brought 13 instruments live in the U.S.
  • Additionally, contracted 14 Pheno instruments with distributors and new customers in EMEA in the quarter.
  • Ended the fourth quarter with 313 U.S. live revenue-generating instruments, with another 81 U.S. contracted Pheno instruments not yet live.
  • Net sales of $3.3 million, compared to $3.1 million in the fourth quarter of 2020, or a 6% increase.
  • Gross margin excluding non-cash adjustments to inventory was 35% for the quarter, compared to 37% in the fourth quarter of 2020. This decrease was the result of pandemic-related effects on manufacturing.
  • Selling, general, and administrative expenses for the quarter were $11.5 million, compared to $11.2 million in the fourth quarter of 2020. This slight increase was driven by increases to non-cash stock-based compensation expense. Excluding non-cash stock-based compensation expense, SG&A costs decreased due to cost savings initiatives.
  • Research and development (R&D) costs for the quarter were $4.6 million, compared to $5.1 million in the fourth quarter of 2020. This decrease was the result of Arc costs decreasing in the period partially offset by increases in Pheno II program investment.
  • Net loss was $22.8 million in the fourth quarter, or $0.34 per share, which included $3.0 million in non-cash stock-based compensation expense and $4.5 million from a non-cash inventory write-down. Net loss excluding non-cash charges was $15.3 million in the fourth quarter, or $0.23 per share.
  • Net cash used in the quarter was $13.3 million, and the company ended the quarter with total cash, investments, and cash equivalents of $63.6 million.

2021 Full Year Highlights

  • Net sales were $11.8 million for the year as compared to $11.2 million from the same period in the prior year, or 5% growth.
  • Gross margin excluding non-cash adjustments to inventory valuation was 35% for the year, compared to 40% for the prior year. This decrease was the result of pandemic-related effects on manufacturing.
  • Selling, general, and administrative expenses were $49.2 million for the year, compared to $46.9 million in 2020. This increase was driven by increases to non-cash stock-based compensation expense. Excluding this non-cash expense, SG&A decreased year-over-year due to cost savings initiatives.
  • Research and development (R&D) costs were $21.9 million year-to-date, compared to $21.3 million in 2020. This slight increase was the result of costs to complete Arc development and Pheno II program investment.
  • Net loss was $77.7 million, or $1.26 per share, which included $22.0 million in non-cash stock-based compensation expense and a $4.5 million non-cash inventory write-down. Net loss excluding non-cash charges was $51.2 million, or $0.83 per share.
  • Net cash used was $47.2 million, and the company ended the year with total cash, investments, and cash equivalents of $63.6 million.

Full financial results for the year ending December 31, 2021, will be filed on Form 10-K through the Securities and Exchange Commission's (SEC) website at http://www.sec.gov.

Audio Webcast and Conference Call

The company will host a conference call at 4:30PM ET today to review its fourth quarter and full year 2021 results. To listen to the 2021 fourth quarter and full year 2021 financial results call by phone, +1.877.883.0383 and enter Elite Entry Number: 8732862.  International participants may dial +1.412.902.6506. Please dial in 10–15 minutes prior to the start of the conference. A replay of the call will be available by telephone at +1.877.344.7529 (U.S.) or +1.412.317.0088 (International) using the replay code 7365004 until March 29, 2022.

This conference call will also be webcast and can be accessed from the "Investors" section of the company's website at ir.axdx.com. A replay of the audio webcast will be available until June 8, 2022.

About Accelerate Diagnostics, Inc.

Accelerate Diagnostics, Inc. is an in vitro diagnostics company dedicated to providing solutions for the global challenges of antibiotic resistance and sepsis. The Accelerate Pheno® system and Accelerate PhenoTest® BC kit combine several technologies aimed at reducing the time clinicians must wait to determine the most optimal antibiotic therapy for deadly infections. The FDA cleared system and kit fully automate the sample preparation steps to report phenotypic antibiotic susceptibility results in approximately 7 hours direct from positive blood cultures. Recent external studies indicate the solution offers results 1-2 days faster than existing methods, enabling clinicians to optimize antibiotic selection and dosage specific to the individual patient days earlier.

The "ACCELERATE DIAGNOSTICS" and "ACCELERATE PHENO" and "ACCELERATE PHENOTEST" and "ACCELERATE ARC" and diamond shaped logos and marks are trademarks or registered trademarks of Accelerate Diagnostics, Inc.

For more information about the company, its products and technology, or recent publications, visit axdx.com.

Forward-Looking Statements

Certain of the statements made in this press release are forward looking, such as, among others, Mr. Phillips statements regarding strong research and development initiatives enabling sales of new products, customer interest in PhenoAST and Accelerate Arc leading to future sales, the expected launch of the Accelerate Arc instrument in March 2022, and our expectation for improved commercial activity because of strong interest in our new products and an improved hospital environment in 2022. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. Information about the risks and uncertainties faced by Accelerate Diagnostics is contained in the section captioned "Risk Factors" in the company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 2, 2021, and in any other reports that the company files with the Securities and Exchange Commission. The company's forward-looking statements could be affected by general industry and market conditions. Except as required by federal securities laws, the company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies.

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

BALANCE SHEETS

(in thousands, except share data)



December 31,


2021

2020

ASSETS

Current assets:



Cash and cash equivalents

$39,898

$35,781

Investments

23,720

32,488

Trade accounts receivable

2,320

1,550

Inventory

5,067

9,216

Prepaid expenses

768

1,172

Other current assets

1,558

1,780

Total current assets

73,331

81,987

Property and equipment, net

5,389

6,135

Right of use assets

2,510

3,183

Other non-current assets

1,817

2,120

Total assets

$83,047

$93,425




LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:



Accounts payable

$1,983

$1,290

Accrued liabilities

2,853

2,991

Accrued interest

909

1,262

Deferred revenue

451

376

Current portion of long-term debt

80

553

Current operating lease liability

669

497

Total current liabilities

6,945

6,969

Non-current operating lease liability

2,381

3,063

Other non-current liabilities

808

335

Long-term debt

4,659

Convertible notes

107,984

141,211

Total liabilities

118,118

156,237




Commitments and contingencies






Stockholders' deficit:



Preferred shares, $0.001 par value;



5,000,000 preferred shares authorized and 3,954,546 outstanding as of December 31, 2021 and 5,000,000 preferred shares authorized and none outstanding as of December 31, 2020

4

Common stock, $0.001 par value;



100,000,000 common shares authorized with 67,649,018 shares issued and outstanding on December 31, 2021 and 85,000,000 common shares authorized with 57,607,939 shares issued and outstanding on December 31, 2020

68

58

Contributed capital

580,652

475,072

Treasury stock

(45,067)

(45,067)

Accumulated deficit

(570,668)

(492,966)

Accumulated other comprehensive loss

(60)

91

Total stockholders' deficit

(35,071)

(62,812)

Total liabilities and stockholders' deficit

$83,047

$93,425

 

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(in thousands, except per share data)



Years Ended December 31,


2021

2020

2019

Net sales

$11,782

$11,165

$9,297





Cost of sales:




Cost of sales of products and services

7,663

6,706

4,897

Inventory write-down

4,500

Total cost of sales

12,163

6,706

4,897





Gross profit

(381)

4,459

4,400





Costs and expenses:




Research and development

21,943

21,255

25,345

Sales, general and administrative

49,236

46,904

51,886

Total costs and expenses

71,179

68,159

77,231





Loss from operations

(71,560)

(63,700)

(72,831)





Other income (expense):




Interest expense

(15,545)

(15,550)

(14,256)

Gain on extinguishment of debt

9,793

Foreign currency exchange (loss) gain

(413)

252

(124)

Interest and dividend income

88

855

2,809

Other expense, net

(20)

(60)

(14)

Total other expense, net

(6,097)

(14,503)

(11,585)





Net loss before income taxes

(77,657)

(78,203)

(84,416)

(Provision) benefit for income taxes

(45)

(5)

111

Net loss

$(77,702)

$(78,208)

$(84,305)





Basic and diluted net loss per share

$(1.26)

$(1.40)

$(1.55)

Weighted average shares outstanding

61,727

56,010

54,506





Other comprehensive loss:




Net loss

$(77,702)

$(78,208)

$(84,305)

Net unrealized (loss) gain on investments

(34)

(2)

193

Foreign currency translation adjustment

(117)

151

(102)

Comprehensive loss

$(77,853)

$(78,059)

$(84,214)

 

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENTS OF STOCKHOLDERS' DEFICIT

(in thousands)



Preferred
Shares

Preferred
Stock
Amount

Common
Shares

Common
Stock
Amount

Contributed
Capital

Accumulated
Deficit

Treasury
Stock

Accumulated
Other
Comprehensive
Income (Loss)

Total
Stockholders'
Equity (Deficit)

Balances, January 1, 2019

54,232

$54

$432,885

$(330,348)

$(45,067)

$(149)

$57,375

Net loss

(84,305)

(84,305)

Issuance of common stock

56

1,000

1,000

Exercise of options and restricted stock awards issued

396

1

5,364

5,365

Issuance of common stock under employee purchase plan

25

458

458

Unrealized gain on investments

193

193

Foreign currency translation adjustment

(102)

(102)

Equity-based compensation

12,637

12,637

Balances, December 31, 2019

54,709

55

452,344

(414,653)

(45,067)

(58)

(7,379)

Net loss

(78,208)

(78,208)

Exercise of options and restricted stock awards issued

2,858

3

6,059

6,062

Issuance of common stock under employee purchase plan

41

359

359

Unrealized gain on investments

(2)

(2)

Foreign currency translation adjustment

151

151

Cumulative impact of accounting change

(105)

(105)

Equity-based compensation

16,310

16,310

Balances, December 31, 2020

57,608

58

475,072

(492,966)

(45,067)

91

(62,812)

Net loss

(77,702)

(77,702)

Issuance of common stock

4,937

5

32,400

32,405

Exchange of common stock for preferred

(2,643)

(3)

(20,297)

(20,300)

Issuance of preferred stock

3,955

4

30,446

30,450

Exercise of options and restricted stock awards issued

1,090

1

1,619

1,620

Issuance of common stock under employee purchase plan

54

326

326

Unrealized loss on investments

(34)

(34)

Foreign currency translation adjustment

(117)

(117)

Issuance of shares in exchange for Convertible Senior Notes

6,603

7

38,896

38,903

Equity-based compensation

22,190

22,190

Balances, December 31, 2021

$3,955

$4

$67,649

$68

$580,652

$(570,668)

$(45,067)

$(60)

$(35,071)

 

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENT OF CASH FLOWS

(in thousands)



Years Ended December 31,


2021

2020

2019

Cash flows from operating activities:




Net loss

$(77,702)

$(78,208)

$(84,305)

Adjustments to reconcile net loss to net cash used in operating activities:




Depreciation and amortization

2,518

2,997

2,602

Amortization of investment discount

226

99

(427)

Equity-based compensation expense

22,047

16,464

12,618

Amortization of debt discount and issuance costs

11,542

11,168

9,969

Realized loss on available-for-sale securities

3

(Gain) loss on disposal of property and equipment

(75)

785

837

Contributions to deferred compensation plan

(484)

(357)

Gain on extinguishment of debt

(9,793)

Inventory write-down

4,500

(Increase) decrease in assets:




Accounts receivable

(770)

1,592

(1,362)

Inventory

(415)

(1,356)

(3,655)

Prepaid expense and other assets

1,014

(2,087)

(752)

Increase (decrease) in liabilities:




Accounts payable

273

(1,006)

988

Accrued liabilities

(469)

(909)

(1,327)

Accrued interest

(283)

Deferred revenue and income

75

105

54

Deferred compensation

473

316

(34)

Net cash used in operating activities

(47,323)

(50,394)

(64,794)

Cash flows from investing activities:




Purchases of equipment

(603)

(1,362)

(330)

Purchase of marketable securities

(30,081)

(46,933)

(50,226)

Proceeds from sales of marketable securities

250

14,500

Maturities of marketable securities

38,738

61,901

88,867

Net cash provided by investing activities

8,304

13,606

52,811

Cash flows from financing activities:




Proceeds from issuance of common and preferred shares

42,880

359

1,458

Proceeds from exercise of options

1,620

5,703

4,907

Proceeds from issuance of common stocks under employee purchase plan

326

359

458

Proceeds from debt

5,578

Payment of debt

(360)

(366)

Common stock issuance cost

(325)

Payment of costs related to debt exchange

(915)

Net cash provided by financing activities

43,226

11,633

6,823





Effect of exchange rate on cash

(90)

(78)

(86)





Increase (decrease) in cash and cash equivalents

4,117

(25,233)

(5,246)

Cash and cash equivalents, beginning of period

35,781

61,014

66,260

Cash and cash equivalents, end of period

$39,898

$35,781

$61,014

 

ACCELERATE DIAGNOSTICS, INC.

CONSOLIDATED

STATEMENT OF CASH FLOWS (CONTINUED)

(in thousands)



Years Ended December 31,


2021

2020

2019

Non-cash investing activities:




Net transfer of instruments from inventory to property and equipment

$688

$1,525

$3,361

Supplemental cash flow information:




Interest paid

$4,288

$4,288

$4,288

Income taxes paid, net of refunds

$—

$43

$41

Extinguishment of Convertible Senior Notes through issuance of common stock

$38,902

$—

$—


See accompanying notes to consolidated financial statements.

 

SOURCE Accelerate Diagnostics, Inc.

For further information: Investor Inquiries & Media Contact: Laura Pierson, Accelerate Diagnostics, +1 520 365-3100, investors@axdx.com