Exhibit 99.1
 
Tenon Medical, Inc. Reports First Quarter 2022 Financial Results
 
~ Closes $16 Million IPO and Commences Trading on the Nasdaq ~
 
Los Gatos, CA, June 7, 2022 -
Tenon Medical, Inc.
(“Tenon Medical” or the “Company”), a medical device company that has developed a proprietary, U.S. Food and Drug Administration (“FDA”) cleared surgical implant system for sacroiliac joint (“SI Joint”) fixation/fusion surgery, today reported financial results for the quarter ended March 31, 2022.
 
Recent Highlights
 
·
Closes $16 Million Initial Public Offering (“IPO”) on April 29, 2022
 
·
Company’s common stock commenced trading on the Nasdaq Capital Markets under the ticker symbol “TNON”
 
·
Initial commercialization commencement of the Catamaran SIJ Fusion System
 
·
Revenue of $71,000 in the first quarter of 2022, a 373% increase from the same period in 2021
 
·
As of March 31, 2022, the Company hosted 9 physician workshop events
 
“Tenon Medical kicked off 2022 achieving a tremendous milestone with our transition to a public company listing on the Nasdaq Capital Markets subsequent to quarter end,” commented Steve Foster, CEO and President of Tenon Medical.  “This milestone comes on the heels of the significant accomplishments the Company has achieved to date; inclusive of finalizing our commercial ready product, the CATAMARAN SIJ Fusion System and the completion of our first successful cases.  Additionally, it’s important to note, we have hosted a total of 9 physician workshop events all of which have provided remarkably positive feedback as the clinician community has been looking for the next generation device.  Physicians demand an authentic arthrodesis procedure that includes prepping, fixating, and grafting the joint.  We believe the CATAMARAN System delivers on these requirements.”
 
Rich Ferrari, Founder and Chairman of Tenon added, “We formed Tenon in 2012 to develop the CATAMARAN SIJ Fusion System designed to fuse one or both sacroiliac joints to treat SI-Joint dysfunction that very often causes lower back pain.  Studies indicate that 15 to 30% of all lower back pain is associated with the SI-Joint.  We believe Tenon is uniquely positioned to grow the adoption of the CATAMARAN delivering pain relief to individuals while driving significant value creation for our shareholders.”
 
First Quarter 2022 Financial Results
 
Revenue was $71,000 in the first quarter of 2022, an increase of 373%, compared to $15,000 in the comparable year ago period.  The increase was primarily due to an 80% increase in the number of surgical procedures in which the CATAMARAN System was used.
 
Gross loss was $(204,000) compared to a gross profit of $4,000 in the comparable year ago quarter, due to the increase in the operations overhead and spending. Gross margin percentage decreased from 27% to (283)%, driven by higher operations overhead, spending, and partially offset by higher revenue per procedure resulting from an amended and restated national distribution agreement.
 
Operating losses totaled $2.1 million for the first quarter of 2022, compared to a loss of $189,000 in the first quarter 2021. The increase in operating expenses was a result of the creation of an infrastructure to support future growth and the ongoing transition to an operating company.
 
 
Net loss was $2.4 million for the first quarter of 2022, compared a loss of $201,000 in the same period of 2021 and expect to incur additional losses in the future.
 
As of March 31, 2022, cash and cash equivalents totaled $4.7 million.  The Company believes that the net proceeds from the initial public offering, together with existing cash and cash equivalents, will enable Tenon Medical to fund hiring additional personnel, product development and sales and marketing activities including clinician training and clinical marketing.
 
About Tenon Medical, Inc.
 
Tenon Medical, Inc., a medical device company formed in 2012, has developed a proprietary, FDA cleared surgical implant system, which is designed to optimize SI-Joint fixation / fusion surgery and corresponding outcomes. Tenon is preparing a national launch of this system to address the greatly underserved market opportunity that exists in this space.  For more information, please visit
https://www.tenonmed.com/
.
 
Safe Harbor
 
This press release contains “forward-looking statements,” which are statements related to events, results, activities or developments that Tenon Medical expects, believes or anticipates will or may occur in the future. Forward-looking often contain words such as “intends,” “estimates,” “anticipates,” “hopes,” “projects,” “plans,” “expects,” “seek,” “believes,” "see," “should,” “will,” “would,” “target,” and similar expressions and the negative versions thereof. Such statements are based on Tenon Medical’s experience and perception of current conditions, trends, expected future developments and other factors it believes are appropriate under the circumstances, and speak only as of the date made. Forward-looking statements are inherently uncertain and actual results may differ materially from assumptions, estimates or expectations reflected or contained in the forward-looking statements as a result of various factors. For details on the uncertainties that may cause our actual results to be materially different than those expressed in our forward-looking statements, please review our Registration Statement on Form S-1 on file with the Securities and Exchange Commission at www.sec.gov, particularly the information contained in the section entitled “Risk Factors”. We undertake no obligation to publicly update or revise any forward-looking statements to reflect new information or future events or otherwise unless required by law.
 
Investor Contact
Shannon Devine
MZ North America
203-741-8811
tenon@mzgroup.us
 
 
Tenon Medical, Inc.
Interim Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited)
(In thousands, except per share data)
 
 
 
Three Months Ended
March 31,
 
 
 
2022
 
 
2021
 
Revenue
 
$
71
 
 
$
15
 
Cost of sales
 
 
275
 
 
 
11
 
Gross (Loss) Profit
 
 
(204
)
 
 
4
 
 
 
 
            
Operating Expenses
 
 
            
Research and development expenses
 
 
562
 
 
 
87
 
Sales and marketing expenses
 
 
276
 
 
 
4
 
General and administrative expenses
 
 
1,037
 
 
 
102
 
Total Operating Expenses
 
 
1,875
 
 
 
193
 
 
 
 
            
Loss from Operations
 
 
(2,079
)
 
 
(189
)
 
 
 
            
Other Income (Expense)
 
 
            
    Gain on investments
 
 
1
 
 
 
—
 
Interest expense
 
 
(274
)
 
 
(11
)
Other expense
 
 
(1
)
 
 
(1
)
Total Other Expense
 
 
(274
)
 
 
(12
)
Net Loss
 
 
(2,353
)
 
 
(201
)
Loss attributable to non-controlling interest
 
 
—
 
 
 
(1
)
Net Loss Attributable to Tenon Medical, Inc.
 
$
(2,353
)
 
$
(200
)
Net Loss Attributable to Tenon Medical, Inc. Per Share of Common Stock
 
 
            
Basic and diluted
 
$
(2.38
)
 
$
(0.24
)
 
 
 
            
Weighted-Average Shares of Common Stock Outstanding
 
 
            
Basic and diluted
 
 
989,954
 
 
 
830,000
 
 
 
 
            
Consolidated Statements of Comprehensive Loss:
 
 
            
Net loss
 
$
(2,353
)
 
$
(201
)
Unrealized loss on investments
 
 
—
 
 
 
—
 
Change in foreign currency translation adjustment
 
 
—
 
 
 
—
 
Total Comprehensive Loss
 
 
(2,353
)
 
 
(201
)
Comprehensive loss attributable to non-controlling interest
 
 
—
 
 
 
(1
)
Total comprehensive loss attributable to Tenon Medical, Inc.
 
$
(2,353
)
 
$
(200
)
 
 
Tenon Medical, Inc.
 
Interim Condensed Consolidated Balance Sheets (Unaudited)
(In thousands, except share data)
 
 
 
 
March 31,
 
 
December 31,
 
 
 
 
2022
 
 
 
 
2021
 
 
 
(Unaudited)
 
 
 
 
Assets
 
 
            
Current Assets
 
 
            
Cash and cash equivalents
 
$
4,677
 
 
$
2,917
 
Investments
 
 
—
 
 
 
4,404
 
Accounts receivable
 
 
64
 
 
 
76
 
Inventory
 
 
602
 
 
 
188
 
Prepaid expenses
 
 
82
 
 
 
87
 
Total current assets
 
 
5,425
 
 
 
7,672
 
    Fixed assets - net
 
 
219
 
 
 
101
 
    Deposits
 
 
41
 
 
 
41
 
    Operating lease right-of-use asset
 
 
1,032
 
 
 
1,084
 
Deferred offering costs
 
 
428
 
 
 
374
 
TOTAL ASSETS
 
$
7,145
 
 
$
9,272
 
 
 
 
            
Liabilities, Convertible Preferred Stock, and Stockholders’ Deficit
 
 
            
Current Liabilities
 
 
            
Accounts payable
 
$
425
 
 
$
478
 
Accrued expenses
 
 
970
 
 
 
1,088
 
Current portion of operating lease liability
 
 
227
 
 
 
202
 
Convertible notes payable and accrued interest – net of debt discount of $14 and $31 at March 31, 2022 and December 31, 2021, respectively
 
 
13,118
 
 
 
12,857
 
Convertible notes payable and accrued interest due to related parties – net of debt discount of $1 and $2 at March 31, 2022 and December 31, 2021, respectively
 
 
662
 
 
 
649
 
Total current liabilities
 
 
15,402
 
 
 
15,274
 
    Operating lease liability – net of current portion
 
 
839
 
 
 
911
 
Total Liabilities
 
 
16,241
 
 
 
16,185
 
 
 
 
            
 
 
 
 
 
 
 
 
 
Convertible Preferred Stock
 
 
            
Series A convertible preferred stock, $0.001 par value; 4,500,000 and 2,805,839 shares authorized at March 31, 2022 and December 31, 2021, respectively; 2,550,763 shares issued and outstanding at March 31, 2022 and December 31, 2021; liquidation preference of $3,891
 
 
12,367
 
 
 
12,367
 
Series B convertible preferred stock, $0.001 par value; 491,222 shares authorized; 491,222 shares issued and outstanding at March 31, 2022 and December 31, 2021; liquidation preference of $2,447
 
 
1,272
 
 
 
1,272
 
Stockholders’ Deficit
 
 
            
Common stock, $0.001 par value; 130,000,000 and 10,487,904 shares authorized at March 31, 2022 and December 31, 2021, respectively; 989,954 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively
 
 
1
 
 
 
1
 
Additional paid-in capital
 
 
282
 
 
 
113
 
Accumulated deficit
 
 
(22,928
)
 
 
(20,575
)
Accumulated other comprehensive income (loss)
 
 
(91
)
 
 
(91
)
Total stockholders’ deficit
 
 
(22,736
)
 
 
(20,552
)
TOTAL LIABILITIES, CONVERTIBLE PREFERRED STOCK, AND STOCKHOLDERS' DEFICIT
 
$
7,145
 
 
$
9,272