Mazor Robotics Reports Record First Quarter Results

 - First Quarter 2018 Revenue Increased 32% Year Over Year -
- Conference Call Today at 8:30 AM EDT (3:30PM IDT) -

CAESAREA, Israel – May 14, 2018 – Mazor Robotics Ltd. (TASE: MZOR; NASDAQGM: MZOR), a pioneer and a leader in the field of robotic guidance systems, reported record first quarter revenue of $15.5 million compared to $11.7 million in the first quarter of 2017.

 “Our record first quarter revenue reflects clinical adoption, as we surpassed 33,000 cases performed, and the continued global demand for the Mazor X and Renaissance systems,” commented Ori Hadomi, Chief Executive Officer. “Commercially, we successfully expanded into a new international market with the Mazor X and making progress penetrating into the Ambulatory Surgery Center ("ASC") market in the U.S. with the Renaissance.  Our performance, coupled with the growing number of peer-reviewed papers, presentations and the interim data from our prospective studies, is transforming spine surgery in markets around the world.  Finally, we are also advancing and expanding our technology development efforts with Medtronic, and I am pleased to share that commercialization of the Mazor X platform, which integrates Medtronic's Stealth navigation and offers a unique robot-guided implant solution that eliminates the need for guidewires, is expected at the end of 2018.”

FIRST QUARTER 2018 FINANCIAL RESULTS ON IFRS BASIS ("GAAP")

Revenue for the three months ended March 31, 2018 increased 32% to $15.5 million compared to $11.7 million in the year-ago first quarter, mainly due to increased recurring revenue from kit sales, services and other.  U.S. revenue increased 27% to $14.2 million compared to $11.2 million in the year-ago first quarter. International revenue increased 160% to $1.3 million compared to $0.5 million in the year-ago first quarter.

The Company’s gross margin for the three months ended March 31, 2018 was 58.3% compared to 64.6% in the year-ago first quarter.  This expected decrease is attributed mainly to the pricing terms with Medtronic. Total operating expenses were $10.5 million compared to $13.3 million in the year-ago first quarter, mainly due to lower selling and marketing expenses, following the transition to the global distribution phase of the Medtronic partnership.  Operating loss was $1.4 million compared to an operating loss of $5.7 million in the year-ago first quarter. Net loss for the first quarter of 2018 was $1.3 million, or $0.02 per share, compared to a net loss of $5.2 million, or $0.11 per share, for the year-ago first quarter.

 Cash provided by operating activities was $2.7 million compared to cash provided by operating activities of $0.7 million in last year’s first quarter as a result of high collection efforts from customers. As of March 31, 2018, cash, cash equivalents and investments totaled $114.5 million.

 

FIRST QUARTER 2018 FINANCIAL RESULTS ON NON-GAAP BASIS

The tables below include reconciliations of the Company’s GAAP results to non-GAAP results. The reconciliations relate to non-cash expenses in the amount of $1.6 million with respect to share-based payments and amortization of intangible assets recorded in the first quarter of 2018. On a non-GAAP basis, the net income in the first quarter of 2018 was $0.3 million, or $0.01 per share, compared to net loss of $3.9 million, or $0.08 per share, for the year-ago first quarter.

 

CONFERENCE CALL INFORMATION

The company will host a conference call to discuss these results on Monday, May 14, 2018, at 8:30 AM EDT (3:30 PM IDT).  Investors within the United States interested in participating are invited to call 800-239-9838.   Participants in Israel can use the toll-free dial-in number 1809 212 883. All other international participants can use the dial-in number +1 323-794-2551.

A replay of the event will be available for two weeks following the conclusion of the call. To access the replay, callers in the United States can call 1-888-203-1112 and reference the Replay Access Code: 3873868. All international callers can dial +1 719-457-0820, using the same Replay Access Code. To access the webcast, please visit www.mazorrobotics.com and select ‘Investor Relations.’

Use of Non-GAAP Measures

In addition to disclosing financial results calculated in accordance with generally accepted accounting principles in conformity with International Financial Reporting Standards (GAAP), this press release contains Non-GAAP financial measures for gross profit, operating expenses, operating profit (loss), net income (loss) and basic and diluted earnings (loss) per share that exclude the effects of non-cash expense of amortization of intangible assets and share-based payments. Management believes that these non-GAAP financial measures provide meaningful supplemental information regarding the Company’s performance that enhances management's and investors' ability to evaluate the Company's net income (loss) and earnings (loss) per share and to compare them to historical net income (loss) and earnings (loss) per share.

The presentation of this non-GAAP financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Management uses both GAAP and non-GAAP measures when operating and evaluating the Company’s business internally and therefore decided to make these non-GAAP adjustments available to investors.

About Mazor

Mazor Robotics (TASE: MZOR; NASDAQGM: MZOR) believes in healing through innovation by developing and introducing revolutionary technologies and products aimed at redefining the gold standard of quality care. Mazor Robotics Guidance System enables surgeons to conduct spine and brain procedures in an accurate and secure manner. For more information, please visit www.MazorRobotics.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. Any statements in this release about future expectations, plans or prospects for the Company, including without limitation, statements regarding interim data from prospective studies, advancing and expanding technology development efforts, timing of integration of Stealth navigation, and other statements containing the words “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions are forward-looking statements. These statements are only predictions based on Mazor's current expectations and projections about future events. There are important factors that could cause Mazor's actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements. Those factors include, but are not limited to, the impact of general economic conditions, competitive products, product demand and market acceptance risks, reliance on key strategic alliances, fluctuations in operating results, and other factors indicated in Mazor's filings with the Securities and Exchange Commission (SEC) including those discussed under the heading "Risk Factors" in Mazor’s annual report on Form 20-F filed with the SEC on April 30, 2018 and in subsequent filings with the SEC. For more details, refer to Mazor's SEC filings. Mazor undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or to changes in our expectations, except as may be required by law.

 

U.S. Contacts: EVC Group

Michael Polyviou/Doug Sherk - Investors                                             

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732.232.6914; 415.652.9100

 

Mazor Robotics Ltd.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AS OF

(U.S. Dollars in thousands)

 

 

March 31,

 

December 31,

 

2018

 

2017

 

(Unaudited)

 

(Audited)

Current assets

         

Cash and cash equivalents

$

47,003

 

$

46,376

Short-term investments

 

62,484

 

 

56,708

Trade receivables

 

1,608

 

 

5,460

Other current assets

 

2,445

 

 

2,054

Inventory

 

7,954

 

 

7,864

Total current assets

 

121,494

 

 

118,462

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

Long-term investments

 

4,993

 

 

5,171

Property and equipment, net

 

4,505

 

 

4,323

Intangible assets, net

 

1,843

 

 

1,925

Other non-current assets

 

1,058

 

 

1,115

Total non-current assets

 

12,399

 

 

12,534

 

 

 

 

 

 

Total assets

$

133,893

 

$

130,996

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Trade payables

$

2,561

 

$

3,474

Deferred revenue

 

3,250

 

 

3,471

Other current liabilities

 

9,466

 

 

9,874

Total current liabilities

 

15,277

 

 

16,819

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

Employee benefits

 

472

 

 

414

Total non-current liabilities

 

472

 

 

414

 

 

 

 

 

 

Total liabilities

 

15,749

 

 

17,233

 

 

 

 

 

 

 Equity

 

 

 

 

 

Share capital

 

138

 

 

136

Share premium

 

231,253

 

 

225,678

Amounts allocated to warrants

 

9,629

 

 

9,629

Capital reserve for share-based payment  transactions

 

10,561

 

 

10,480

Foreign currency translation reserve

 

2,119

 

 

2,119

Accumulated loss

 

(135,556)

 

 

(134,279)

Total equity

 

118,144

 

 

113,763

 

 

 

 

 

 

Total liabilities and equity

$

133,893

 

$

130,996

 

 

 

 

 

 

Mazor Robotics Ltd.
CONSOLIDATED CASH FLOW STATEMENTS
 (U.S. Dollars in thousands)

 

Three month period

 

ended March 31,

 

2018

(Unaudited)

   

2017

(Unaudited)

Cash flows from operating activities:

 

 

 

 

 

 

 

Loss for the period

 

$

(1,277)

 

 

$

(5,232)

Adjustments:

 

 

 

 

 

 

 

Depreciation and amortization

 

$

421

 

 

$

342

Finance income, net

 

$

(174)

 

 

$

(50)

Share-based payments

 

$

1,535

 

 

$

1,201

Income tax expense (tax benefit)

 

$

(1)

 

 

$

(243)

 

 

$

1,781

 

 

$

1,250

 

 

 

 

 

 

 

 

Change in inventory

 

$

(140)

 

 

$

(1,362)

Change in trade and other accounts receivable

 

$

3,534

 

 

$

4,771

Change in prepaid lease fees

 

$

5

 

 

$

(21)

Change in trade and other accounts payable

 

$

(1,524)

 

 

$

1,103

Change in employee benefits

 

$

58

 

 

$

78

 

 

$

1,933

 

 

$

4,569

 

 

 

 

 

 

 

 

Interest received

 

$

281

 

 

$

72

Income tax paid

 

$

(28)

 

 

$

-

 

 

$

253

 

 

$

72

Net cash provided by operating activities

 

$

2,690

 

 

$

659

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Proceeds from (investment in) short-term investments, net

 

$

(2,244)

 

 

$

8,957

Investments in long-term investments

 

$

(3,354)

 

 

$

(98)

Purchase of property and equipment

 

$

(488)

 

 

$

(809)

Net cash provided by investing activities

 

$

(6,086)

 

 

$

8,050

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Proceeds from exercise of share options by employees

 

$

4,122

 

 

$

2,259

Net cash provided by financing activities

 

$

4,122

 

 

$

2,259

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

$

726

 

 

$

10,968

Cash and cash equivalents at the beginning of the period

 

$

46,376

 

 

$

14,954

Effect of exchange rate differences on balances of

 

 

 

 

 

 

 

 cash and cash equivalents

 

$

(99)

 

 

$

(26)

Cash and cash equivalents at the end of the period

 

$

47,003

 

 

$

25,896

Supplementary cash flows information:

 

 

 

 

 

 

 

Purchase of property and equipment in credit

 

$

(7)

 

 

$

(148)

Classification of inventory to fixed assets

 

$

50

 

 

$

300

                   


Mazor Robotics
Ltd.
RECONCILIATIONS OF GAAP TO NON-GAAP FINANCIAL MEASURES

 (U.S. Dollars in thousands, except per share data)

                                                                                  (UNAUDITED)

 

     

Three month period

     

ended March 31,

     

2018

   

2017

GAAP gross profit

 

 

$

9,042

   

$

7,570

Amortization of intangible assets

 

 

 

82

 

 

 

82

Share-based payments

 

 

 

118

 

 

 

53

Non-GAAP gross profit

 

 

$

9,242

 

 

$

7,705

GAAP gross profit as percentage of revenues

 

 

 

58.3%

 

 

 

64.6%

Non-GAAP gross profit as percentage of revenues

 

 

 

59.6%

 

 

 

65.7%

 

 

 

 

 

 

 

 

 

GAAP operating expenses

 

 

$

10,490

 

 

$

13,256

Share-based payments:

 

 

 

 

 

 

 

 

Research and development

 

 

$

304

 

 

$

158

Selling and marketing

 

 

$

512

 

 

$

440

General and administrative

 

 

$

601

 

 

$

550

Non-GAAP operating expenses

 

 

$

9,073

 

 

$

12,108

 

 

 

 

 

 

 

 

 

GAAP operating loss

 

 

$

(1,448)

 

 

$

(5,686)

 

 

 

 

 

 

 

 

 

Non-GAAP operating profit (loss)

 

 

$

169

 

 

$

(4,403)

 

 

 

 

 

 

 

 

 

GAAP net loss

 

 

$

(1,277)

 

 

$

(5,232)

Amortization of intangible assets

 

 

 

82

 

 

 

82

Share-based payments

 

 

$

1,535

 

 

$

1,201

Non-GAAP net income (loss)

 

 

$

340

 

 

$

(3,949)

 

 

 

 

 

 

 

 

 

GAAP basic and diluted loss per share

 

 

$

(0.02)

 

 

$

(0.11)

 

 

 

 

 

 

 

 

 

Non-GAAP basic and diluted earnings (loss) per share

 

 

$

0.01

 

 

$

(0.08)

 

 

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