UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
_________________________________________________________________
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 27, 2023
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(Exact name of registrant as specified in its charter)
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| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
(Address of principal executive offices) (Zip Code)
(949 ) 396-6322
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | ||||||||
Securities registered pursuant to Section 12(b) of the Exchange Act:
| Title of class | Trading symbol | Name of exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
| Emerging growth company | |||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On July 27, 2023, Axonics, Inc. (the Company) issued a press release announcing its financial results for the quarter ended June 30, 2023. The full text of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The information in this Current Report on Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall it be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |||||||
| 99.1 | ||||||||
| 104 | Cover Page Interactive Date File - the cover page XBRL tags are embedded within the Inline XBRL document. | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| AXONICS, INC. | ||||||||||||||
Date: July 27, 2023 | By: | /s/ Raymond W. Cohen | ||||||||||||
| Raymond W. Cohen | ||||||||||||||
| Chief Executive Officer | ||||||||||||||
Exhibit 99.1
Axonics Reports Second Quarter 2023 Financial Results
Generated quarterly revenue of $92.9 million, an increase of 35% year over year
Fiscal year 2023 revenue guidance increased to $358 million
IRVINE, Calif. – July 27, 2023 – Axonics, Inc. (Nasdaq: AXNX), a global medical technology company that is developing and commercializing novel products for the treatment of bladder and bowel dysfunction, today reported financial results for the three months ended June 30, 2023.
“Our commercial team continues to execute at a high level, generating revenue growth of 35% year over year in the second quarter,” said Raymond W. Cohen, chief executive officer. “Our growth was driven by higher utilization and share of wallet at existing customers and the onboarding of new accounts. Based on the strong results generated in the second quarter, we are raising our fiscal year 2023 revenue guidance to $358 million, representing growth of 31% year over year.”
Cohen continued, “Higher manufacturing yields, insourcing certain processes, and a keen focus on managing our supply chain resulted in a gross margin of over 75% in the second quarter. This gross margin result combined with record revenue and the inherent operating leverage of our business model resulted in adjusted EBITDA of over $18 million in the second quarter. Axonics is growing rapidly and profitably as we advance on our path to incontinence market leadership.”
2Q23 Financial Results
•Net revenue was $92.9 million in 2Q23, an increase of 35% compared to the prior year period.
◦Sacral neuromodulation revenue was $74.2 million, of which $72.2 million was generated in the U.S. and the remainder in international markets.
◦Bulkamid revenue was $18.7 million, of which $14.8 million was generated in the U.S. and the remainder in international markets.
•Gross margin was 75.6% in 2Q23 compared to 72.8% in the prior year period.
•Operating expenses were $82.3 million in 2Q23 and included a $15.4 million non-cash charge for acquired in-process research and development related to the Radian technology acquisition and a $0.6 million non-cash charge for the change in fair value of contingent consideration related to the Bulkamid acquisition. Operating expenses were $71.6 million in the prior year period.
◦Excluding the above-referenced non-cash charges, adjusted operating expenses were $66.2 million in 2Q23.
•Adjusted EBITDA was $18.4 million in 2Q23 compared to $1.6 million in the prior year period.
•Net loss was $7.3 million in 2Q23 compared to a net loss of $21.4 million in the prior year period.
•Cash, cash equivalents and short-term investments were $331.5 million as of June 30, 2023.
◦In 2Q23, Axonics made a $35 million milestone payment to Contura Holdings Limited related to Bulkamid achieving over $50 million of sales in the 12-month period ended March 31, 2023.
Fiscal Year 2023 Revenue Guidance
Axonics has updated its fiscal year 2023 revenue guidance as follows:
•Total company revenue of $358 million, an increase of 31% compared to fiscal year 2022. This compares to prior fiscal year 2023 revenue guidance of $348 million.
◦Sacral neuromodulation revenue of $285.5 million, an increase of 29% compared to fiscal year 2022.
◦Bulkamid revenue of $72.5 million, an increase of 40% compared to fiscal year 2022.
Webcast and Conference Call
Axonics will host a conference call today at 4:30 p.m. Eastern Time to discuss financial results and recent business developments. To access the conference call by telephone, interested parties may register at the following link: Axonics 2Q23 registration.
For those not planning to ask a question, the company recommends accessing the conference call by webcast at the following link: Axonics 2Q23 webcast. A replay of the webcast will be archived in the Events section of the Axonics investor relations website.
About Axonics
Axonics is a global medical technology company that is developing and commercializing novel products for adults with bladder and bowel dysfunction. Axonics recently ranked No. 2 on the 2023 Financial Times ranking of the fastest growing companies in the Americas and No. 4 on the 2022 Deloitte Technology Fast 500.
Axonics® sacral neuromodulation systems provide adults with overactive bladder and/or fecal incontinence with long-lived, easy to use, safe, clinically effective therapy. In addition, the company’s best-in-class urethral bulking hydrogel, Bulkamid®, provides safe and durable symptom relief to women with stress urinary incontinence. In the U.S., moderate to severe urinary incontinence affects an estimated 28 million women and fecal incontinence affects an estimated 19 million adults. For more information, visit www.axonics.com.
Forward-Looking Statements
Statements made in this press release that relate to future plans, events, prospects or performance are forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Words such as “plans,” “expects,” “believes,” “anticipates,” “designs,” and similar words are intended to identify forward-looking statements. While these forward-looking statements are based on the current expectations and beliefs of management, such forward-looking statements are subject to a number of risks, uncertainties, assumptions and other factors that could cause actual results to differ materially from the expectations expressed in this press release, including the risks and uncertainties disclosed in Axonics filings with the Securities and Exchange Commission, all of which are available online at www.sec.gov. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. Except as required by law, Axonics undertakes no obligation to update or revise any forward-looking statements to reflect new information, changed circumstances or unanticipated events.
Use of Non-GAAP Financial Measures
To supplement Axonics’ consolidated financial statements prepared in accordance with generally accepted accounting principles (GAAP), Axonics provides certain non-GAAP financial measures in this release as supplemental financial metrics.
Adjusted EBITDA is calculated as net income (loss) before other income/expense (including interest), income tax expense (benefit), depreciation and amortization expense, stock-based compensation expense, acquisition-related costs, acquired in-process research and development expense, loss on disposal of property and equipment, and expense related to impairment of intangible assets. Management believes that in order to properly understand short-term and long-term financial trends, investors may want to consider the impact of these excluded items in addition to GAAP measures. The excluded items vary in frequency and/or impact on our results of operations and management believes that the excluded items are typically not reflective of our ongoing core business operations and financial condition. Further, management uses adjusted EBITDA for both strategic and annual operating planning. A reconciliation of adjusted EBITDA reported in this release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA” later in this release.
The non-GAAP financial measures used by Axonics may not be the same or calculated in the same manner as those used and calculated by other companies. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for Axonics’ financial results prepared and reported in accordance with GAAP. We urge investors to review the reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures included in this press release, and not to rely on any single financial measure to evaluate our business.
Axonics contact:
Neil Bhalodkar
Neil Bhalodkar
949-336-5293
IR@axonics.com
Axonics, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share data)
| June 30, | December 31, | ||||||||||
| 2023 | 2022 | ||||||||||
| (unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current assets | |||||||||||
| Cash and cash equivalents | $ | 145,343 | $ | 238,846 | |||||||
| Short-term investments | 186,173 | 118,365 | |||||||||
| Accounts receivable, net of allowance for credit losses of $367 and $321 at June 30, 2023 and December 31, 2022, respectively | 47,436 | 44,817 | |||||||||
| Inventory, net | 70,083 | 55,765 | |||||||||
| Prepaid expenses and other current assets | 6,361 | 7,282 | |||||||||
| Total current assets | 455,396 | 465,075 | |||||||||
| Property and equipment, net | 6,349 | 6,798 | |||||||||
| Intangible assets, net | 85,543 | 86,253 | |||||||||
| Other assets | 2,817 | 6,813 | |||||||||
| Goodwill | 98,880 | 94,414 | |||||||||
| Total assets | $ | 648,985 | $ | 659,353 | |||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current liabilities | |||||||||||
| Accounts payable | $ | 12,185 | $ | 9,070 | |||||||
| Accrued liabilities | 5,571 | 6,520 | |||||||||
| Accrued compensation and benefits | 12,559 | 15,495 | |||||||||
| Operating lease liability, current portion | 1,769 | 1,562 | |||||||||
| Other current liabilities | — | 32,600 | |||||||||
| Total current liabilities | 32,084 | 65,247 | |||||||||
| Operating lease liability, net of current portion | 1,199 | 7,555 | |||||||||
| Deferred tax liabilities, net | 15,173 | 16,412 | |||||||||
| Total liabilities | 48,456 | 89,214 | |||||||||
| Commitments and contingencies | |||||||||||
| Stockholders’ equity | |||||||||||
| Preferred stock, par value $0.0001 per share; 10,000,000 shares authorized, no shares issued and outstanding at June 30, 2023 and December 31, 2022 | — | — | |||||||||
| Common stock, par value $0.0001, 75,000,000 shares authorized at June 30, 2023 and December 31, 2022; 50,461,257 and 49,546,727 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively | 5 | 5 | |||||||||
| Additional paid-in capital | 1,009,704 | 969,545 | |||||||||
| Accumulated deficit | (390,854) | (374,264) | |||||||||
| Accumulated other comprehensive loss | (18,326) | (25,147) | |||||||||
| Total stockholders’ equity | 600,529 | 570,139 | |||||||||
| Total liabilities and stockholders’ equity | $ | 648,985 | $ | 659,353 | |||||||
Axonics, Inc.
Consolidated Statements of Comprehensive Loss
(in thousands, except share and per share data)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
| Net revenue | $ | 92,894 | $ | 68,980 | $ | 163,544 | $ | 117,400 | |||||||||||||||
| Cost of goods sold | 22,704 | 18,784 | 40,854 | 33,962 | |||||||||||||||||||
| Gross profit | 70,190 | 50,196 | 122,690 | 83,438 | |||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||
| Research and development | 8,949 | 7,135 | 17,005 | 18,371 | |||||||||||||||||||
| General and administrative | 10,713 | 10,572 | 22,881 | 20,585 | |||||||||||||||||||
| Sales and marketing | 44,270 | 39,381 | 86,924 | 72,444 | |||||||||||||||||||
| Amortization of intangible assets | 2,279 | 2,332 | 4,501 | 4,795 | |||||||||||||||||||
| Acquisition-related costs | 602 | 12,205 | 2,368 | 12,205 | |||||||||||||||||||
| Acquired in-process research & development | 15,447 | — | 15,447 | — | |||||||||||||||||||
| Total operating expenses | 82,260 | 71,625 | 149,126 | 128,400 | |||||||||||||||||||
| Loss from operations | (12,070) | (21,429) | (26,436) | (44,962) | |||||||||||||||||||
| Other income (expense) | |||||||||||||||||||||||
| Interest and other income | 4,250 | 360 | 7,878 | 403 | |||||||||||||||||||
| Interest and other expense | 174 | (839) | 857 | (1,128) | |||||||||||||||||||
| Other income (expense), net | 4,424 | (479) | 8,735 | (725) | |||||||||||||||||||
| Loss before income tax benefit | (7,646) | (21,908) | (17,701) | (45,687) | |||||||||||||||||||
| Income tax benefit | (304) | (465) | (1,111) | (1,576) | |||||||||||||||||||
| Net loss | (7,342) | (21,443) | (16,590) | (44,111) | |||||||||||||||||||
| Foreign currency translation adjustment | 3,750 | (12,648) | 6,821 | (17,568) | |||||||||||||||||||
| Comprehensive loss | $ | (3,592) | $ | (34,091) | $ | (9,769) | $ | (61,679) | |||||||||||||||
| Net loss per share, basic and diluted | $ | (0.15) | $ | (0.47) | $ | (0.34) | $ | (0.98) | |||||||||||||||
| Weighted-average shares used to compute basic and diluted net loss per share | 49,088,373 | 45,311,001 | 48,835,135 | 45,225,494 | |||||||||||||||||||
Axonics, Inc.
Net Revenue by Product and Region
(in thousands)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
| Sacral neuromodulation | |||||||||||||||||||||||
| United States | $ | 72,205 | $ | 54,468 | $ | 126,058 | $ | 92,183 | |||||||||||||||
| International | 1,983 | 1,290 | 3,288 | 2,645 | |||||||||||||||||||
| Sacral neuromodulation total | $ | 74,188 | $ | 55,758 | $ | 129,346 | $ | 94,828 | |||||||||||||||
| Bulkamid | |||||||||||||||||||||||
| United States | $ | 14,806 | $ | 10,223 | $ | 26,419 | $ | 16,792 | |||||||||||||||
| International | 3,900 | 2,999 | 7,779 | 5,780 | |||||||||||||||||||
| Bulkamid total | $ | 18,706 | $ | 13,222 | $ | 34,198 | $ | 22,572 | |||||||||||||||
| Total net revenue | $ | 92,894 | $ | 68,980 | $ | 163,544 | $ | 117,400 | |||||||||||||||
Axonics, Inc.
Reconciliation of GAAP Net Loss to Adjusted EBITDA
(in thousands)
(unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
| 2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
| GAAP Net loss | $ | (7,342) | $ | (21,443) | $ | (16,590) | $ | (44,111) | |||||||||||||||
| Non-GAAP Adjustments: | |||||||||||||||||||||||
| Interest and other income | (4,250) | (360) | (7,878) | (403) | |||||||||||||||||||
| Interest and other expense | (174) | 839 | (857) | 1,128 | |||||||||||||||||||
| Income tax benefit | (304) | (465) | (1,111) | (1,576) | |||||||||||||||||||
| Depreciation and amortization expense | 3,228 | 2,891 | 6,041 | 5,920 | |||||||||||||||||||
| Stock-based compensation expense | 11,204 | 7,905 | 21,918 | 15,043 | |||||||||||||||||||
| Acquisition-related costs | 602 | 12,205 | 2,368 | 12,205 | |||||||||||||||||||
| Acquired in-process research & development | 15,447 | — | 15,447 | — | |||||||||||||||||||
| Adjusted EBITDA | $ | 18,411 | $ | 1,572 | $ | 19,338 | $ | (11,794) | |||||||||||||||