EX-99.1 2 d620472dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

 

LOGO

Contact:

AtriCure, Inc.

Andy Wade

Vice President and Chief Financial Officer

(513) 755-4564

awade@atricure.com

Investor Relations Contact:

Lynn Pieper

Westwicke Partners

(415) 202-5678

lynn.pieper@westwicke.com

AtriCure Reports Third Quarter 2013 Financial Results

 

    Revenue of $20.1 million – up 24.8%; 24.0% constant currency

 

    U.S. sales of $15.8 million – up 28.1%

 

    International sales of $4.3 million – up 14.2%; 10.8% constant currency

WEST CHESTER, Ohio – October 29, 2013 – AtriCure, Inc. (Nasdaq: ATRC), a leading Atrial Fibrillation medical device provider, today announced financial results for the third quarter of 2013.

“We are pleased with our performance in the third quarter. Our results reflect our third consecutive quarter of double digit year over year revenue growth, driven by overall strength and our U.S. business which was up 28% versus the prior year. We are seeing the results of our training and education efforts in capturing market share, and we are gaining momentum with the AtriClip,” said Mike Carrel, President and Chief Executive Officer of AtriCure. “Based on continued strength across all of our product lines, we are updating our outlook for 2013 to reflect anticipated revenue growth of 14% from 2012.”

Third Quarter 2013 Financial Results

Revenue for the third quarter of 2013 was $20.1 million, an increase of $4.0 million or 24.8% (24.0% on a constant currency basis), compared to third quarter 2012 revenue. Domestic revenue increased 28.1% to $15.8 million, driven by strong sales of ablation-related open-heart products and AtriClip products. International revenue was $4.3 million, an increase of $0.5 million or 14.2% (10.8% on a constant currency basis) when compared to $3.8 million for the third quarter of 2012. International revenue growth was driven primarily by increased sales to direct customers and certain distributors.

Gross profit for the third quarter of 2013 was $14.7 million compared to $11.5 million for the third quarter of 2012. Gross margin for the third quarter of 2013 and 2012 was 72.9% and 71.6%, respectively. The increase in gross margin was due primarily to volume-driven leverage of manufacturing overhead expenses, a higher mix of domestic sales and the strong performance of the new AtriClip Pro product.


Operating expenses for the third quarter of 2013 increased 22.9%, or $3.2 million, compared to the third quarter of 2012. The increase in operating expenses was driven primarily by an increase in selling, marketing and training expenses.

Loss from operations for the third quarter of 2013 was $2.6 million compared to $2.5 million for the third quarter of 2012. Net loss per share was $0.13 for the third quarter of 2013 and $0.16 for the third quarter of 2012.

Cash, cash equivalents and investments were $34.4 million at September 30, 2013 and cash provided by operations during the third quarter of 2013 was $0.7 million.

2013 Guidance

Management projects that 2013 revenue will be approximately $80.0 million, an increase of 14% from 2012. This compares to the previous outlook for 2013 revenue in the range of $77.0 - $78.5 million, an increase of 10% - 12% from 2012.

Adjusted EBITDA, a non-GAAP measure, is projected to be a loss in the range of $4.5 to $5.5 million including the impact of the medical device excise tax which is estimated to be in the range of $0.6 - $0.8 million for 2013. Management expects to continue making investments targeted at future revenue growth.

Conference Call

AtriCure will host a conference call at 4:30 p.m. Eastern Time on Tuesday, October 29, 2013 to discuss its third quarter 2013 financial results. A live webcast of the conference call will be available online from the investor relations page of AtriCure’s corporate website at www.atricure.com.

You may also access this call through an operator by calling (888) 713-4211 for domestic callers and (617) 213-4864 for international callers at least 15 minutes prior to the call start time using reservation code 83850169.

The webcast will be available on AtriCure’s website and a telephonic replay of the call will also be available through November 29, 2013. The replay dial-in numbers are (888) 286-8010 for domestic callers and (617) 801-6888 for international callers. The reservation code is 29085641.

About AtriCure, Inc.

AtriCure, Inc. is a leading atrial fibrillation solutions partner, providing innovative products, professional education and support for clinical science to reduce the economic and social burden of atrial fibrillation. AtriCure’s Synergy Ablation System is the first and only device approved by the Food and Drug Administration (FDA) for the surgical treatment of Persistent and Longstanding Persistent forms of Afib in patients undergoing certain open heart procedures concomitantly (simultaneously). AtriCure's AtriClip™ Left Atrial Appendage (LAA) occlusion device is the most widely implanted device for LAA management worldwide. Afib affects more than two million people worldwide and is estimated to cost more than $6.5 billion annually in healthcare expenses. The number affected by Afib is expected to grow to 12 million by 2050.


Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements that address activities, events or developments that AtriCure expects, believes or anticipates will or may occur in the future, such as earnings estimates (including projections and guidance), other predictions of financial performance, launches by AtriCure of new products and market acceptance of AtriCure’s products. Forward-looking statements are based on AtriCure’s experience and perception of current conditions, trends, expected future developments and other factors it believes are appropriate under the circumstances and are subject to numerous risks and uncertainties, many of which are beyond AtriCure’s control. These risks and uncertainties include the rate and degree of market acceptance of AtriCure’s products, AtriCure’s ability to develop and market new and enhanced products, the timing of and ability to obtain and maintain regulatory clearances and approvals for its products, the timing of and ability to obtain reimbursement of procedures utilizing AtriCure’s products, competition from existing and new products and procedures or AtriCure’s ability to effectively react to other risks and uncertainties described from time to time in AtriCure’s SEC filings, such as fluctuation of quarterly financial results, reliance on third party manufacturers and suppliers, litigation or other proceedings, government regulation and stock price volatility. AtriCure does not guarantee any forward-looking statement, and actual results may differ materially from those projected. AtriCure undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. A further list and description of risks, uncertainties and other matters can be found in our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q.

Use of Non-GAAP Financial Measures

To supplement AtriCure’s condensed consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles, or GAAP, AtriCure uses certain non-GAAP financial measures in this release as supplemental financial metrics. Non-GAAP financial measures provide an indication of performance excluding certain items. Our management believes that in order to properly understand short-term and long-term financial trends, investors may wish to consider the impact of these excluded items in addition to GAAP measures. The excluded items vary in frequency and/or impact on our continuing operations and our management believes that the excluded items are typically not reflective of our ongoing core business operations. Further, management uses results of operations before these excluded items as a basis for its strategic planning. The non-GAAP financial measures used by AtriCure may not be the same or calculated the same as those used by other companies. Reconciliations of the non-GAAP financial measures used in this release to the most comparable GAAP measures for the respective periods can be found in tables later in this release. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for AtriCure’s financial results prepared and reported in accordance with GAAP.


ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Amounts)

(Unaudited)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2013     2012     2013     2012  

Revenue:

        

Open-heart

   $ 9,637      $ 7,656      $ 27,912      $ 24,529   

Minimally invasive

     3,486        3,112        10,129        9,324   

AtriClip

     2,709        1,593        7,884        5,113   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total United States

     15,832        12,361        45,925        38,966   

International

     4,314        3,778        14,080        12,917   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

     20,146        16,139        60,005        51,883   

Cost of revenue

     5,461        4,590        16,111        14,871   
  

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

     14,685        11,549        43,894        37,012   

Operating expenses:

        

Research and development expenses

     3,237        2,905        9,792        9,180   

Selling, general and administrative expenses

     14,062        11,173        40,155        33,178   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

     17,299        14,078        49,947        42,358   
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss from operations

     (2,614     (2,529     (6,053     (5,346

Other expense

     (130     (27     (415     (148
  

 

 

   

 

 

   

 

 

   

 

 

 

Loss before income tax expense

     (2,744     (2,556     (6,468     (5,494

Income tax expense

     (4     (11     (14     (20
  

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

   $ (2,748   $ (2,567   $ (6,482   $ (5,514
  

 

 

   

 

 

   

 

 

   

 

 

 

Basic and diluted net loss per share

   $ (0.13   $ (0.16   $ (0.32   $ (0.34
  

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares used in computing net loss per common share:

        

Basic and diluted

     20,725        16,278        20,311        16,143   
  

 

 

   

 

 

   

 

 

   

 

 

 


ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Per Share Amounts)

(Unaudited)

 

     September 30,     December 31,  
     2013     2012  

Assets

    

Current assets:

    

Cash, cash equivalents and short-term investments

   $ 29,685      $ 12,000   

Accounts receivable, net

     11,031        9,948   

Inventories

     7,062        5,718   

Other current assets

     779        873   
  

 

 

   

 

 

 

Total current assets

     48,557        28,539   

Property and equipment, net

     4,135        3,430   

Intangible assets

     23        32   

Long-term investments

     4,678        —     

Other assets

     244        430   
  

 

 

   

 

 

 

Total assets

   $ 57,637      $ 32,431   
  

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

    

Current liabilities:

    

Accounts payable and accrued liabilities

   $ 14,238      $ 10,176   

Current maturities of long-term debt and capital lease obligations

     2,037        2,029   
  

 

 

   

 

 

 

Total current liabilities

     16,275        12,205   

Long-term debt and capital lease obligations

     4,922        6,407   

Other liabilities

     195        1,319   
  

 

 

   

 

 

 

Total liabilities

     21,392        19,931   

Stockholders’ equity:

    

Common stock

     21        17   

Additional paid-in capital

     153,420        123,157   

Other comprehensive income

     37        77   

Accumulated deficit

     (117,233     (110,751
  

 

 

   

 

 

 

Total stockholders’ equity

     36,245        12,500   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 57,637      $ 32,431   
  

 

 

   

 

 

 


ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands)

(Unaudited)

 

     Nine Months Ended September 30,  
     2013     2012  

Cash flows from operating activities:

    

Net loss

   $ (6,482   $ (5,514

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

    

Share-based compensation expense

     2,072        2,941   

Depreciation and amortization of intangible assets

     1,465        1,520   

Amortization of deferred financing costs

     69        81   

Loss (gain) on disposal of equipment

     30        (12

Amortization/accretion on investments

     (4     16   

Change in allowance for doubtful accounts

     (14     (21

Changes in assets and liabilities

    

Accounts receivable

     (1,049     125   

Inventories

     (1,313     (319

Other current assets

     117        122   

Accounts payable and accrued liabilities

     2,744        (510

Other non-current assets and liabilities

     207        (174
  

 

 

   

 

 

 

Net cash used in operating activities

     (2,158     (1,745

Cash flows from investing activities:

    

Purchases of available-for-sale securities

     (9,186     (8,538

Maturities of available-for-sale securities

     4,900        8,100   

Purchases of property and equipment

     (1,930     (2,372

Net proceeds from the sale of equipment

     2        24   
  

 

 

   

 

 

 

Net cash used in investing activities

     (6,214     (2,786

Cash flows from financing activities:

    

Net proceeds from sale of stock

     26,872        —     

Proceeds from debt borrowings

     —          10,000   

Payments on debt and capital leases

     (1,547     (7,568

Payment of debt fees

     (99     (78

Proceeds from stock option exercises

     1,277        562   

Shares repurchased for payment of taxes on stock awards

     (279     (372

Proceeds from issuance of common stock under employee stock purchase plan

     326        372   
  

 

 

   

 

 

 

Net cash provided by financing activities

     26,550        2,916   

Effect of exchange rate changes on cash and cash equivalents

     (110     59   
  

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

     18,068        (1,556

Cash and cash equivalents - beginning of period

     7,753        9,759   
  

 

 

   

 

 

 

Cash and cash equivalents - end of period

   $ 25,821      $ 8,203   
  

 

 

   

 

 

 


ATRICURE, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP RESULTS TO NON-GAAP RESULTS

(In Thousands)

(Unaudited)

Reconciliation of Non-GAAP Adjusted Loss (Adjusted EBITDA)

 

     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
     2013     2012     2013     2012  

Net loss, as reported

   $ (2,748   $ (2,567   $ (6,482   $ (5,514

Income tax expense

     4        11        14        20   

Other expense (a)

     130        27        415        148   

Depreciation and amortization expense

     508        467        1,465        1,520   

Share-based compensation expense

     734        1,111        2,072        2,941   
  

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP adjusted loss (adjusted EBITDA)

   $ (1,372   $ (951   $ (2,516   $ (885
  

 

 

   

 

 

   

 

 

   

 

 

 
     Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
(a) Other includes:    2013     2012     2013     2012  

Net interest expense

   $ (121   $ (187   $ (420   $ (609

Grant income

     —          117        —          379   

Gain (loss) due to exchange rate fluctuation

     17        (42     73        (77

Non-employee stock option (expense) income

     (26     85        (68     159   
  

 

 

   

 

 

   

 

 

   

 

 

 

Other expense

   $ (130   $ (27   $ (415   $ (148
  

 

 

   

 

 

   

 

 

   

 

 

 

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