EX-99.1 2 d918810dex991.htm PRESS RELEASE Press Release

Exhibit 99.1

 

 

LOGO

Contact:

AtriCure, Inc.

Andy Wade

Senior 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 First Quarter 2015 Financial Results and

Updates 2015 Outlook

 

    Revenue of $29.9 million – up 20.3% as reported, 24% constant currency

 

    U.S. sales of $22.9 million – up 26.3%

 

    International sales of $7.0 million – up 3.9% as reported, 17.6% constant currency

WEST CHESTER, Ohio – April 29, 2015 – AtriCure, Inc. (Nasdaq: ATRC), a leading innovator in technologies for the surgical treatment of atrial fibrillation and left atrial appendage management, today announced first quarter 2015 financial results.

“We had a strong start to the year and remain well positioned to help treat patients suffering from atrial fibrillation through our continued investment in education, training and growth initiatives,” said Mike Carrel, President and Chief Executive Officer of AtriCure.

“We are particularly excited about partnering with the American Association for Thoracic Surgery (AATS) Graham Foundation to initiate the inaugural Dr. James Cox Fellowship in Atrial Fibrillation Surgery. Educational efforts such as this will increase awareness and the ability of physicians to treat atrial fibrillation and manage the left atrial appendage. We continue to work toward penetrating the multi-billion dollar market opportunity ahead of us, which is increasingly being validated by leading physicians,” continued Mr. Carrel.

First Quarter 2015 Financial Results

Revenue for the first quarter of 2015 was $29.9 million, an increase of $5.0 million or 20.3% (24.0% on a constant currency basis), compared to first quarter 2014 revenue. Domestic revenue increased 26.3% to $22.9 million, driven by strong sales of ablation-related open-heart products, ablation-related minimally invasive products, and AtriClip products. International revenue was $7.0 million, an increase of $0.3 million or 3.9% (17.6% on a constant currency basis) compared to $6.7 million for the first quarter of 2014. International revenue growth was driven primarily by increases in product sales in Europe.


Gross profit for the first quarter of 2015 was $21.7 million compared to $17.7 million for the first quarter of 2014. Gross margin for the first quarter of 2015 and 2014 was 72.7% and 71.1%, respectively. The increase in gross margin was primarily due to the heavier U.S. sales mix, favorable product costs and the elimination of certain acquisition transition costs included in the three months ended March 31, 2014.

Operating expenses for the first quarter of 2015 increased 5.1%, or $1.3 million, compared to the first quarter of 2014. The increase in operating expenses was driven primarily by an increase in selling, clinical, product development, and training expenses partially offset by certain acquisition transition costs included in the three months ended March 31, 2014.

Loss from operations for the first quarter of 2015 was $5.1 million, compared to $7.9 million for the first quarter of 2014. Adjusted EBITDA, a non-GAAP measure, was a loss of $2.1 million for the first quarter of 2015, compared to a $4.7 million loss for the first quarter of 2014. Net loss per share was $0.19 for the first quarter of 2015 and $0.31 for the first quarter of 2014.

2015 Guidance

Management projects that 2015 revenue will be in the range of $123.5 million to $125.5 million, which represents an increase of 15% to 17% over 2014 (17% to 19% on a constant currency basis). This compares to previous expectations of 2015 revenue in the range of $122.5 million to $124.5 million.

Management continues to project Adjusted EBITDA, a non-GAAP measure, to be a loss in the range of $7 million to $9 million for 2015 in order to continue making strategic investments to drive the long-term growth plan.

Conference Call

AtriCure will host a conference call at 4:30 p.m. Eastern Time on Wednesday, April 29, 2015 to discuss its first quarter 2015 financial results. A live webcast of the conference call will be available online on the Investors page of AtriCure’s corporate website at www.atricure.com. You may also access this call through an operator by calling (866) 515-2911 for domestic callers and (617) 399-5125 for international callers at least 15 minutes prior to the call start time using participant passcode 15114945.

The webcast will be available on AtriCure’s website and a telephonic replay of the call will be available through May 6, 2015. The replay dial-in numbers are (888) 286-8010 for domestic callers and (617) 801-6888 for international callers. The participant passcode is 62321731.

About AtriCure, Inc.

AtriCure, Inc. is a medical device company providing innovative atrial fibrillation (Afib) solutions designed to produce superior outcomes that reduce the economic and social burden of atrial fibrillation. AtriCure’s Synergy™ Ablation System is the first and only surgical device approved for the treatment of persistent and longstanding persistent forms of Afib in patients undergoing certain open concomitant procedures. AtriCure’s AtriClip left atrial appendage management (LAAM) exclusion device is the most widely sold device worldwide that’s indicated for the occlusion of the left atrial appendage. The company believes cardiothoracic surgeons are adopting its ablation and LAAM devices for the treatment of Afib and reduction of Afib related complications such as stroke. Afib affects more than 33 million people worldwide.


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, AtriCure’s ability to retain and attract key employees, 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, AtriCure’s ability to continue to be in compliance with applicable U.S. federal and state and foreign government laws and regulations, AtriCure’s ability to consummate acquisitions or, if consummated, to successfully integrate acquired businesses into AtriCure’s operations, AtriCure’s ability to recognize the benefits of acquisitions, including potential synergies and cost savings, failure of an acquisition or acquired company to achieve its plans and objectives generally, risk that proposed or consummated acquisitions may disrupt operations or pose difficulties in employee retention or otherwise affect financial or operating results, competition from existing and new products and procedures, including the development of drug or catheter-based technologies, 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, fluctuations in exchange rates for future sales denominated in foreign currency, which represent a majority of AtriCure’s sales outside of the United States, 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 accounting principles generally accepted in the United States of America, 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 March 31,  
     2015     2014  

Domestic Revenue:

    

Open-heart ablation

   $ 12,354      $ 10,377   

Minimally invasive ablation

     4,347        3,448   

AtriClip

     5,503        3,620   
  

 

 

   

 

 

 

Total ablation and AtriClip

  22,204      17,445   

Valve tools

  719      698   
  

 

 

   

 

 

 

Total domestic

  22,923      18,143   

International Revenue:

Open-heart ablation

  4,216      3,971   

Minimally invasive ablation

  1,968      2,003   

AtriClip

  671      443   
  

 

 

   

 

 

 

Total ablation and AtriClip

  6,855      6,417   

Valve tools

  108      287   
  

 

 

   

 

 

 

Total international

  6,963      6,704   

Total revenue

  29,886      24,847   

Cost of revenue

  8,151      7,190   
  

 

 

   

 

 

 

Gross profit

  21,735      17,657   

Operating expenses:

Research and development expenses

  5,609      4,001   

Selling, general and administrative expenses

  21,270      21,581   
  

 

 

   

 

 

 

Total operating expenses

  26,879      25,582   
  

 

 

   

 

 

 

Loss from operations

  (5,144   (7,925

Other (expense) income, net

  (116   243   
  

 

 

   

 

 

 

Loss before income tax expense

  (5,260   (7,682

Income tax expense

  6      27   
  

 

 

   

 

 

 

Net loss

$ (5,266 $ (7,709
  

 

 

   

 

 

 

Basic and diluted net loss per share

$ (0.19 $ (0.31
  

 

 

   

 

 

 

Weighted average shares used in computing net loss per share:

Basic and diluted

  27,069      24,766   
  

 

 

   

 

 

 


ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Per Share Amounts)

(Unaudited)

 

     March 31,
2015
    December 31,
2014
 

Assets

    

Current assets:

    

Cash, cash equivalents and short-term investments

   $ 55,733      $ 59,649   

Accounts receivable, net

     19,786        17,558   

Inventories

     15,106        14,257   

Other current assets

     2,790        2,044   
  

 

 

   

 

 

 

Total current assets

  93,415      93,508   

Property and equipment, net

  13,874      11,552   

Long-term investments

  2,025      8,894   

Goodwill and intangible assets, net

  43,961      44,264   

Other noncurrent assets

  131      186   
  

 

 

   

 

 

 

Total assets

$ 153,406    $ 158,404   
  

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable and accrued liabilities

$ 18,633    $ 21,662   

Other current liabilities and current maturities of capital leases

  5,996      3,981   
  

 

 

   

 

 

 

Total current liabilities

  24,629      25,643   

Capital leases

  79      74   

Other noncurrent liabilities

  139      149   
  

 

 

   

 

 

 

Total liabilities

  24,847      25,866   

Stockholders’ equity:

Common stock

  28      28   

Additional paid-in capital

  273,019      271,282   

Accumulated other comprehensive loss

  (798   (348

Accumulated deficit

  (143,690   (138,424
  

 

 

   

 

 

 

Total stockholders’ equity

  128,559      132,538   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

$ 153,406    $ 158,404   
  

 

 

   

 

 

 


ATRICURE, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In Thousands)

(Unaudited)

 

     Three Months Ended March 31,  
     2015     2014  

Cash flows from operating activities:

    

Net loss

   $ (5,266   $ (7,709

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

    

Share-based compensation expense

     1,724        2,142   

Depreciation and amortization of intangible assets

     1,311        1,085   

Amortization of deferred financing costs

     16        59   

Loss on disposal of property and equipment

     57        14   

Realized loss from foreign exchange on intercompany transactions

     251        —     

Amortization/accretion on investments

     184        83   

Change in allowance for doubtful accounts

     100        (17

Other

     —          95   

Changes in operating assets and liabilities

    

Accounts receivable

     (2,685     (1,045

Inventories

     (1,104     (862

Other current assets

     (779     312   

Accounts payable and accrued liabilities

     (2,807     (8,500

Other non-current assets and liabilities

     28        (55
  

 

 

   

 

 

 

Net cash used in operating activities

  (8,970   (14,398

Cash flows from investing activities:

Purchases of available-for-sale securities

  (6,086   —     

Sales and maturities of available-for-sale securities

  11,899      8,434   

Purchases of property and equipment

  (1,434   (1,020

Increases in property under build-to-suit obligation

  (1,822   —     
  

 

 

   

 

 

 

Net cash provided by investing activities

  2,557      7,414   

Cash flows from financing activities:

Net proceeds from sale of stock

  —        65,872   

Payments on debt and capital leases

  (14   (6,343

Increases in build-to-suit obligation

  1,822      —     

Payment of debt fees and premium on retirement of debt

  —        (100

Proceeds from stock option exercises

  516      1,395   

Shares repurchased for payment of taxes on stock awards

  (503   (88
  

 

 

   

 

 

 

Net cash provided by financing activities

  1,821      60,736   

Effect of exchange rate changes on cash and cash equivalents

  (233   (5
  

 

 

   

 

 

 

Net (decrease) increase in cash and cash equivalents

  (4,825   53,747   

Cash and cash equivalents - beginning of period

  28,384      14,892   
  

 

 

   

 

 

 

Cash and cash equivalents - end of period

$ 23,559    $ 68,639   
  

 

 

   

 

 

 

Supplemental cash flow information:

Cash paid for interest

$ 2    $ 102   

Cash paid for income taxes

  —        146   

Noncash investing and financing activities:

Accrued purchases of property and equipment

  751      124   

Assets acquired through capital lease

  36      —     


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 March 31,  
     2015     2014  

Net loss, as reported

   $ (5,266   $ (7,709

Income tax expense

     6        27   

Other expense (income), net (a)

     116        (243

Depreciation and amortization expense

     1,311        1,085   

Share-based compensation expense

     1,724        2,142   
  

 

 

   

 

 

 

Non-GAAP adjusted loss (adjusted EBITDA)

$ (2,109 $ (4,698
  

 

 

   

 

 

 

 

     Three Months Ended March 31,  
     2015     2014  

(a) Other includes:

    

Net interest income (expense)

   $ 25      $ (223

Grant income

     35        363   

(Loss) gain due to exchange rate fluctuation

     (163     5   

Non-employee stock option (expense) income

     (13     98   
  

 

 

   

 

 

 

Other (expense) income, net

$ (116 $ 243   
  

 

 

   

 

 

 

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