SANTA ROSA, Calif., May 5, 2015 (GLOBE NEWSWIRE) -- TriVascular Technologies, Inc. (Nasdaq:TRIV), manufacturer of the Ovation Prime® Abdominal Stent Graft System, today reported financial results for the first quarter ended March 31, 2015.
Recent Accomplishments:
- First quarter revenue of $8.0 million, up 14.1% over the first quarter of 2014 as reported and 19.3% on a constant currency basis
- First quarter gross margin of 58.1%, an increase from 47.9% in the first quarter of 2014
- Over 50 patients enrolled in U.S. LIFE study to date
- Ovation iX™ Aortic stent graft submitted for regulatory approvals in the United States
"Our first quarter revenue demonstrated market share gains, which we expect to continue based on the broad clinical label, meaningful technological advantages and overall ease of use of the Ovation® system. We remain focused on strengthening our sales and marketing capabilities to match our technology excellence. We are making significant progress in advancing our product development and clinical initiatives, and look forward to continually expanding our reach to a broader group of patients," said President and Chief Executive Officer, Chris Chavez. "The Ovation Prime system is a clinically proven, less invasive solution that can expand EVAR to more patients and provides us with a platform for sustained growth."
First Quarter Financial Results
Revenue for the three months ended March 31, 2015 increased 14.1% to $8.0 million, from $7.0 million in the same period of the prior year. This increase was primarily attributable to the growth of our U.S. business as our sales force continued to gain traction and customer utilization increased. Geographically, revenue in the United States was $5.5 million, an increase of 19.9% from the three months ended March 31, 2014. International revenue totaled $2.5 million, an increase of 3% from the three months ended March 31, 2014. On a constant currency basis our international and worldwide revenue increased 18.1% and 19.3%, respectively, in the quarter.
Gross margin for the first quarter of 2015 was 58.1%, up from 47.9% in the three months ended March 31, 2014. The increase in gross margin was primarily due to spreading our manufacturing overhead costs over higher production volumes.
Operating expenses for the first quarter of 2015 were $18.2 million, an increase of 13.8% compared to the first quarter of 2014. The increase in operating expenses was driven primarily by an increase in selling, marketing and general and administrative expenses.
Loss from operations for the first quarter of 2015 was $13.5 million, compared to $12.6 million for the first quarter of 2014. Net loss for the first quarter of 2015 was $15.6 million, compared to $14.4 million for the first quarter of 2014. Adjusted EBITDA, a non-GAAP measure, was a loss of $12.5 million for the first quarter of 2015 compared to $12.0 million in the first quarter of 2014.
Cash and cash equivalents and short term investments were $66.2 million as of March 31, 2015.
2015 Financial Guidance
TriVascular anticipates revenue for full-year 2015 to be in the range of $36 million to $39 million, reflecting year-over-year growth of approximately 13% to 23% over 2014 on a reported basis and 17% to 27% on a constant currency basis. Gross margin is expected to be between 60% and 62%.
Conference Call
Management will host an investment community conference call today beginning at 1:30 p.m. PT / 4:30 p.m. ET. Individuals interested in listening to the conference call may dial (844) 831-3024 for domestic callers or (315) 625-6887 for international callers (Conference ID: 18558429), or access the webcast on the "Investors" section of the Company's web site at: www.trivascular.com. The webcast will be available on the Company's web site for 14 days following the completion of the call.
Use of Non-GAAP Financial Measures
This press release includes the non-GAAP financial measures of Adjusted EBITDA and of constant currency revenue growth percentage. We evaluate our results of operations on an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. We believe presenting constant currency information provides valuable supplemental information regarding our results of operations, consistent with how we evaluate our performance. We calculate constant currency percentages by converting our prior-period local currency financial results using the current period exchange rates and comparing these adjusted amounts to our current period reported results. We define EBITDA as net loss plus interest expense, income tax expense, and depreciation and amortization. We define Adjusted EBITDA as EBITDA plus stock-based compensation expense and the change in value of our warrants. For a reconciliation of Adjusted EBITDA to the most comparable GAAP financial measure of net loss, please refer to the table appearing at the end of this press release. We present Adjusted EBITDA because we believe it is a useful indicator of our operating performance. Our management uses Adjusted EBITDA principally as a measure of our operating performance, and believes that Adjusted EBITDA is useful to our investors because it is frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies in industries similar to ours. Our management also uses Adjusted EBITDA for planning purposes, including the preparation of our annual operating budget and financial projections. Adjusted EBITDA should not be considered in isolation or as a substitute for a measure of our liquidity or operating performance prepared in accordance with U.S. GAAP, and is not indicative of net loss from operations as determined under GAAP. Adjusted EBITDA and other non-GAAP financial measures have limitations that should be considered before using these measures to evaluate our liquidity or financial performance. Adjusted EBITDA does not include certain expenses that may be necessary to review our operating results and liquidity requirements. Our definition and calculation of Adjusted EBITDA may differ from that of other companies. In addition, to facilitate the explanation of the earnings per share calculation for the three months ended March 31, 2015 and 2014, we are also providing a pro forma calculation reflecting conversion of our convertible preferred stock in connection with the closing of our initial public offering in April 2014.
About TriVascular Technologies, Inc. - TriVascular is a medical device company developing and commercializing innovative technologies to significantly advance minimally invasive treatment of abdominal aortic aneurysms. The company manufactures the Ovation Prime Abdominal Stent Graft System, the lowest profile FDA-approved endovascular aortic repair (EVAR) system, which utilizes a novel, polymer-based sealing mechanism. TriVascular is based in Santa Rosa, California.
Forward-Looking Statements
In addition to the historical information, this press release contains forward-looking statements with respect to our business, capital resources, strategic initiatives, financial outlook and growth. These forward-looking statements are based upon information that is currently available to us or our current expectations, speak only as of the date hereof, and are subject to numerous risks and uncertainties, including our ability to successfully commercialize our products; continued market acceptance of our endovascular aortic repair systems; our ability to manufacture our products to meet demand; the level and availability of third party payor reimbursement for our products; our ability to effectively manage our anticipated growth; our ability to protect our intellectual property rights and proprietary technologies; our ability to operate our business without infringing the intellectual property rights and proprietary technology of third parties; our ability to develop new or complementary technologies; the regulatory requirements applicable to us and our competitors; competition in our industry; additional capital and credit availability; our ability to attract and retain qualified personnel; product liability claims; and general economic and worldwide business conditions. These factors, together with those that are described in greater detail in our Annual Report on Form 10-K filed with the SEC on March 9, 2015 and our other filings with the SEC, may cause our actual results, performance or achievements to differ materially and adversely from those anticipated or implied by our forward-looking statements. We expressly disclaim any obligation, except as required by law, or undertaking to update or revise any such forward-looking statements. Our results for the quarter ended March 31, 2015 are not necessarily indicative of our operating results for any future periods.
-- Financial Tables Follow --
| TRIVASCULAR TECHNOLOGIES, INC. | ||
| Consolidated Statements of Comprehensive Loss | ||
| (in thousands, except per share data) | ||
| Three Months Ended | ||
| March 31, | ||
| 2015 | 2014 | |
| (unaudited) | ||
| Revenue | $ 8,025 | $ 7,034 |
| Cost of goods sold | 3,360 | 3,665 |
| Gross profit | 4,665 | 3,669 |
| Gross Margin | 58.1% | 47.9% |
| Operating expenses: | ||
| Sales, general and administrative | 14,167 | 12,192 |
| Research and development | 4,045 | 3,806 |
| Total operating expenses | 18,212 | 15,998 |
| Loss from operations | (13,547) | (12,629) |
| Other expense: | ||
| Interest expense | (1,874) | (1,689) |
| Interest income and other income expense, net | (149) | (82) |
| Loss before income tax expense | (15,570) | (14,400) |
| Provision for income tax | 67 | 23 |
| Net loss | $ (15,637) | $ (14,423) |
| Other comprehensive loss: | ||
| Change in foreign currency translation adjustment | (154) | (20) |
| Change in unrealized gain on short-term investments | 10 | -- |
| Other comprehensive loss | (144) | (20) |
| Comprehensive loss | $ (15,781) | $ (14,443) |
| Net loss per share, basic and diluted | $ (0.77) | $ (21.77) |
| Weighted average shares used to compute net loss per share, basic and diluted | 20,198 | 663 |
Non-GAAP Financial Measures Reconciliation – Pro Forma Net Loss Per Share
To facilitate the explanation of the earnings per share calculation for the three months ended March 31, 2015 and 2014, we are also providing a pro forma calculation reflecting conversion of our convertible preferred stock in connection with the closing of our initial public offering in April 2014. Pro forma basic and diluted net loss per share were computed to give effect to the conversion of the convertible preferred stock which were automatically converted into common stock upon the closing of our initial public offering using the as-if converted method into common shares as though the conversion had occurred as of January 1, 2014 or the original date of issuance, if later. The following table summarizes the unaudited pro forma net loss per share (in thousands, except per share data):
| Three Months Ended | ||
| March 31, | ||
| 2015 | 2014 | |
| (unaudited) | ||
| Numerator | ||
| Net loss | $ (15,637) | $ (14,423) |
| Add: Pro forma adjustment to reverse the mark-to-market adjustments attributable to the convertible preferred stock warrants | -- | 70 |
| Pro forma net loss | $ (15,637) | $ (14,353) |
| Denominator | ||
| Weighted average shares used to compute net loss per share, basic and diluted | 20,198 | 663 |
| Add: Pro forma adjustments to reflect weighted average effect of conversion of convertible preferred stock | -- | 11,602 |
| Weighted average shares used to compute pro forma net loss per share, basic and diluted | 20,198 | 12,265 |
| Pro forma net loss per share, basic and diluted | $ (0.77) | $ (1.17) |
Non-GAAP Financial Measures Reconciliation – EBITDA and Adjusted EBITDA
The following table presents a reconciliation of net loss to EBITDA and Adjusted EBITDA for the periods presented (in thousands):
| Three Months Ended | ||
| March 31, | ||
| 2015 | 2014 | |
| (unaudited) | ||
| Net Loss | $ (15,637) | $ (14,423) |
| Interest expense | 1,874 | 1,689 |
| Provision for income taxes | 67 | 23 |
| Depreciation & amortization | 122 | 141 |
| EBITDA | (13,574) | (12,570) |
| Stock-based compensation | 1,047 | 462 |
| Change in value of warrants | -- | 70 |
| Adjusted EBITDA | $ (12,527) | $ (12,038) |
| TRIVASCULAR TECHNOLOGIES, INC. | ||
| Consolidated Balance Sheets | ||
| (in thousands, except par value data) | ||
| March 31, | December 31, | |
| 2015 | 2014 | |
| (unaudited) | ||
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | $ 20,121 | $ 32,896 |
| Short-term investments | 46,087 | 46,084 |
| Accounts receivable | 6,149 | 6,565 |
| Inventories, net | 9,037 | 8,570 |
| Prepaid expenses and other current assets | 2,151 | 2,932 |
| Total current assets | 83,545 | 97,047 |
| Property and equipment, net | 1,174 | 1,248 |
| Goodwill | 8,259 | 8,259 |
| Other intangible assets | 1,182 | 1,182 |
| Other assets | 774 | 797 |
| Total assets | $ 94,934 | $ 108,533 |
| Liabilities and Stockholders' Equity | ||
| Current liabilities | ||
| Accounts payable | $ 3,695 | $ 1,862 |
| Accrued liabilities and other | 6,803 | 8,465 |
| Total current liabilities | 10,498 | 10,327 |
| Notes payable | 55,601 | 55,004 |
| Other long term liabilities | 3,505 | 3,629 |
| Total liabilities | 69,604 | 68,960 |
| Stockholders' equity | ||
| Preferred stock, $0.01 par value, 5,000 shares authorized, 0 shares issued and outstanding at March 31, 2015 and December 31, 2014 | -- | -- |
| Common stock, $0.01 par value, 100,000 shares authorized, 20,225 and 20,168 shares issued and outstanding at March 31, 2015 and December 31, 2014, respectively | 202 | 202 |
| Additional paid-in capital | 336,983 | 335,445 |
| Accumulated other comprehensive income | (324) | (180) |
| Accumulated deficit | (311,531) | (295,894) |
| Total stockholders' equity | 25,330 | 39,573 |
| Total liabilities and stockholders' equity | $ 94,934 | $ 108,533 |