BIOLASE Reports 31% Sequential Revenue Growth In 2020 Fourth Quarter; Demand From New Users Driving Positive Performance
BIOLASE, Inc. (NASDAQ: BIOL) reported its financial results for Q4 and the full year 2020, revealing a 31% sequential revenue growth to $8.5 million. Despite COVID-19 challenges, U.S. revenue showed resilience, particularly from new users (78%) and dental specialists (40%). Cash reserves reached $17.9 million, boosted by a recent $14.4 million placement. However, year-over-year revenue dropped 17%. The company projects a 65% revenue growth for Q1 2021 compared to Q1 2020.
- 31% sequential increase in Q4 revenue to $8.5 million.
- 78% of sales from new users, indicating strong market interest.
- 40% of sales from dental specialists, showing improved market penetration.
- Increased cash reserves to approximately $40 million post $14.4 million funding.
- Projected revenue growth of 60% to 70% for Q1 2021.
- Q4 2020 revenue declined 17% year-over-year from $10.2 million.
- International laser revenue fell 52% compared to Q4 2019.
- Gross margin decreased to 19% from 43% in Q4 2019.
- Operating loss increased to $5.5 million in Q4 2020 from $3.0 million in Q4 2019.
- Full year 2020 revenue down 40% from 2019.
FOOTHILL RANCH, Calif., March 25, 2021 /PRNewswire/ -- BIOLASE, Inc. (NASDAQ: BIOL), the global leader in dental lasers, today announced its financial results for the fourth quarter and full year ended December 31, 2020.
2020 Fourth Quarter Operating Highlights and Recent Developments:
- Total revenue was
$8.5 million , representing sequential quarterly growth of31% . - U.S. revenue exceeded the prior-year fourth quarter, despite COVID-19 headwinds.
78% of sales came from new users, continuing a positive trend.40% of sales came from dental specialists, a significant increase compared to recent prior periods.- Several Dental Services Organizations ("DSOs") purchased BIOLASE products in the fourth quarter, including Heartland Dental, Dental Care Alliance, Aspen Dental and Virginia Family Dentistry.
- BIOLASE significantly bolstered its balance sheet during the COVID-19 pandemic as cash and cash equivalents totaled
$17.9 million on December 31, 2020. - The Company completed a
$14.4 million bought deal in February 2021 increasing its current cash and cash equivalents to approximately$40.0 million as of February 28, 2021, including the proceeds from the exercise of warrants sold in the Company's July 2020 rights offering.
"Our strong fourth quarter revenue performance is our second consecutive quarter of significant sequential growth and was driven by sales to new customers, dental specialists and DSOs in the U.S.," commented John Beaver, President and Chief Executive Officer. "Dental specialists, such as endodontist and periodontists, comprised
"We have continued to make adjustments to our go-to-market approach during the pandemic, and the momentum we are seeing in the current 2021 first quarter gives us greater confidence that we are nearing a resumption of the growth we were generating prior to COVID-19. Specifically, despite the ongoing impact of the pandemic, we expect to report total revenue growth of approximately
2020 Fourth Quarter Financial Results
Net revenue for the fourth quarter of 2020 was
Gross margin for the fourth quarter of 2020 was
Full Year 2020 Financial Results
Net revenue for the year ended December 31, 2020 was
Gross margin for the year ended December 31, 2020 was
Adjusted EBITDA – Use of Non-GAAP Measures
The Reconciliation of GAAP Net Loss to Adjusted EBITDA at the end of this news release provides the details of the Company's non-GAAP disclosures and the reconciliation of GAAP net loss and net loss per share to the Company's Adjusted EBITDA and Adjusted EBITDA per share.
Adjusted EBITDA loss for the fourth quarter of 2020 was
Adjusted EBITDA for the year ended December 31, 2020 was a loss of
2021 First Quarter Revenue Guidance
For the first quarter ending March 31, 2021, the Company expects total revenue of
Conference Call Information
BIOLASE, Inc. will host a conference call today at 4:30 p.m. Eastern Time to discuss its operating results for the fourth quarter and full year ended December 31, 2020, and to answer questions. For both "listen-only" participants and those participants who wish to take part in the question-and-answer portion of the call, the dial-in number in the U.S./Canada is 800-353-6461. For international participants outside the U.S./Canada, the dial-in number is 334-323-0501. For all callers, refer to the Conference ID 7623727. To access the live webcast, visit the Investor Relations section of the BIOLASE website at www.biolase.com and see "Investor Events".
An audio archive of the webcast will be available for 30 days on the Investor Relations section of the BIOLASE website.
About BIOLASE
BIOLASE is a medical device company that develops, manufactures, markets, and sells laser systems in dentistry and medicine. BIOLASE's products advance the practice of dentistry and medicine for patients and healthcare professionals. BIOLASE's proprietary laser products incorporate approximately 271 patented and 40 patent-pending technologies designed to provide biologically and clinically superior performance with less pain and faster recovery times. BIOLASE's innovative products provide cutting-edge technology at competitive prices to deliver superior results for dentists and patients. BIOLASE's principal products are revolutionary dental laser systems that perform a broad range of dental procedures, including cosmetic and complex surgical applications. BIOLASE has sold over 41,200 laser systems to date in over 80 countries around the world. Laser products under development address BIOLASE's core dental market and other adjacent medical and consumer applications.
For updates and information on Waterlase iPlus®, Waterlase Express™, and laser dentistry, find BIOLASE online at www.biolase.com, Facebook at www.facebook.com/biolase, Twitter at www.twitter.com/biolaseinc, Instagram at www.instagram.com/waterlase_laserdentistry, and LinkedIn at www.linkedin.com/company/biolase.
BIOLASE®, Waterlase® and Waterlase iPlus® are registered trademarks of BIOLASE, Inc.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties, including statements, regarding BIOLASE's expected revenue and revenue growth during the first quarter of 2021. Forward-looking statements can be identified through the use of words such as may," "might," "will," "intend," "should," "could," "can," "would," "continue," "expect," "believe," "anticipate," "estimate," "predict," "outlook," "potential," "plan," "seek," and similar expressions and variations or the negatives of these terms or other comparable terminology. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect BIOLASE's current expectations and speak only as of the date of this release. Actual results may differ materially from BIOLASE's current expectations depending upon a number of factors. These factors include, among others, the coronavirus (COVID-19) and the effects of the outbreak and actions taken in connection therewith, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business, and those other risks and uncertainties that are described in the "Risk Factors" section of BIOLASE's most recent annual report filed on Form 10-K and quarterly report filed on Form 10-Q filed with the Securities and Exchange Commission. Except as required by law, BIOLASE does not undertake any responsibility to revise or update any forward-looking statements.
Tables to Follow
BIOLASE, INC. | ||||||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
(In thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | Twelve Months Ended | |||||||||||||||||||
December 31, | December 31, | |||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||
Net revenue | $ | 8,520 | $ | 10,182 | $ | 22,780 | $ | 37,799 | ||||||||||||
Cost of revenue | 6,915 | 5,765 | 16,607 | 23,511 | ||||||||||||||||
Gross profit | 1,605 | 4,417 | 6,173 | 14,288 | ||||||||||||||||
Operating expenses: | ||||||||||||||||||||
Sales and marketing | 3,767 | 3,731 | 11,242 | 14,396 | ||||||||||||||||
General and administrative | 2,326 | 2,634 | 9,772 | 10,748 | ||||||||||||||||
Engineering and development | 1,051 | 1,100 | 3,695 | 4,765 | ||||||||||||||||
Total operating expenses | 7,144 | 7,465 | 24,709 | 29,909 | ||||||||||||||||
Loss from operations | (5,539) | (3,048) | (18,536) | (15,621) | ||||||||||||||||
(Gain) loss on foreign currency transactions | (47) | 53 | 21 | 121 | ||||||||||||||||
Interest expense, net | 577 | 598 | 2,359 | 2,157 | ||||||||||||||||
Other (income) expense, net | (6) | — | (4,215) | — | ||||||||||||||||
Non-operating (loss) gain | 524 | 651 | (1,835) | 2,278 | ||||||||||||||||
Loss before income tax provision | (6,063) | (3,699) | (16,701) | (17,899) | ||||||||||||||||
Income tax provision (benefit) | 79 | (112) | 128 | (44) | ||||||||||||||||
Net loss | $ | (6,142) | $ | (3,587) | $ | (16,829) | $ | (17,855) | ||||||||||||
Net loss | $ | (6,142) | $ | (3,587) | $ | (16,829) | $ | (17,855) | ||||||||||||
Deemed dividend on convertible preferred stock | — | — | (17,378) | — | ||||||||||||||||
Net loss attributable to common stockholders | $ | (6,142) | $ | (3,587) | $ | (34,207) | $ | (17,855) | ||||||||||||
Net loss per share attributable to common stockholders: | ||||||||||||||||||||
Basic | $ | (0.07) | $ | (0.13) | $ | (0.56) | $ | (0.77) | ||||||||||||
Diluted | $ | (0.07) | $ | (0.13) | $ | (0.56) | $ | (0.77) | ||||||||||||
Shares used in the calculation of net loss per share: | ||||||||||||||||||||
Basic | 93,211 | 28,118 | 61,136 | 23,201 | ||||||||||||||||
Diluted | 93,211 | 28,118 | 61,136 | 23,201 | ||||||||||||||||
BIOLASE, INC. | ||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||
(In thousands, except per share data) | ||||||||||
December 31, | December 31, | |||||||||
2020 | 2019 | |||||||||
(Unaudited) | (Audited) | |||||||||
ASSETS | ||||||||||
Current assets: | ||||||||||
Cash and cash equivalents | $ | 17,564 | $ | 5,789 | ||||||
Restricted cash | 312 | 312 | ||||||||
Accounts receivable, less allowance of | 3,059 | 8,760 | ||||||||
Inventory | 11,157 | 10,995 | ||||||||
Prepaid expenses and other current assets | 3,018 | 1,163 | ||||||||
Total current assets | 35,110 | 27,019 | ||||||||
Property, plant and equipment, net | 782 | 1,193 | ||||||||
Goodwill | 2,926 | 2,926 | ||||||||
Right of use asset | 1,976 | 276 | ||||||||
Other assets | 231 | 433 | ||||||||
Total assets | $ | 41,025 | $ | 31,847 | ||||||
LIABILITIES, REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY | ||||||||||
Current liabilities: | ||||||||||
Accounts payable | $ | 2,651 | $ | 5,332 | ||||||
Accrued liabilities | 6,667 | 4,744 | ||||||||
Deferred revenue, current portion | 1,905 | 2,237 | ||||||||
Total current liabilities | 11,223 | 12,313 | ||||||||
Deferred revenue | 374 | 358 | ||||||||
Warranty accrual | 384 | 245 | ||||||||
Non current term loans, net of discount | 16,186 | 13,466 | ||||||||
Non current operating lease liability | 1,774 | 4 | ||||||||
Other liabilities | 1,056 | 1,119 | ||||||||
Total liabilities | 30,997 | 27,505 | ||||||||
Redeemable preferred stock: | ||||||||||
Series E Preferred stock, par value | — | 3,965 | ||||||||
Total redeemable preferred stock | — | 3,965 | ||||||||
Stockholders' equity: | ||||||||||
Series F Preferred stock, par value | 118 | — | ||||||||
Common stock, par value | 98 | 31 | ||||||||
Additional paid-in capital | 261,573 | 235,594 | ||||||||
Accumulated other comprehensive loss | (385) | (701) | ||||||||
Accumulated deficit | (251,376) | (234,547) | ||||||||
Total stockholders' equity | 10,028 | 377 | ||||||||
Total liabilities, redeemable preferred stock and stockholders' equity | $ | 41,025 | $ | 31,847 | ||||||
BIOLASE, INC. | ||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
(Unaudited, in thousands) | ||||||||||
Twelve Months Ended | ||||||||||
December 31, | ||||||||||
2020 | 2019 | |||||||||
Cash Flows from Operating Activities: | ||||||||||
Net loss | $ | (16,829) | $ | (17,855) | ||||||
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities: | ||||||||||
Depreciation and amortization | 499 | 982 | ||||||||
Provision for bad debts | 1,328 | 1,695 | ||||||||
Provision for sales returns | 87 | — | ||||||||
Provision for inventory excess and obsolescence | (591) | 413 | ||||||||
Inventory disposals | 1,300 | 15 | ||||||||
Amortization of discounts on lines of credit | 165 | 140 | ||||||||
Amortization of debt issuance costs | 331 | 188 | ||||||||
Change in fair value of warrants | (5,850) | — | ||||||||
Issuance costs for common stock warrants | 1,641 | — | ||||||||
Stock-based compensation | 3,370 | 2,742 | ||||||||
Warrants issued to consultants | — | 48 | ||||||||
Deferred income taxes | — | 7 | ||||||||
Earned interest income | — | 2 | ||||||||
Changes in operating assets and liabilities: | ||||||||||
Accounts receivable | 4,286 | 655 | ||||||||
Inventory | (871) | 825 | ||||||||
Prepaid expenses and other current assets | 825 | 439 | ||||||||
Accounts payable and accrued liabilities | (2,107) | (3,156) | ||||||||
Deferred revenue | (379) | 114 | ||||||||
Net cash and cash equivalents used in operating activities | (12,795) | (12,746) | ||||||||
Cash Flows from Investing Activities: | ||||||||||
Purchases of property, plant, and equipment | (96) | (207) | ||||||||
Net cash and cash equivalents used in investing activities | (96) | (207) | ||||||||
Cash Flows from Financing Activities: | ||||||||||
Proceeds from the issuance of common stock | 6,912 | 9,171 | ||||||||
Proceeds from the issuance of Series F Convertible Preferred Stock | 2,700 | — | ||||||||
Proceeds from the issuance of July 2020 Warrants | 15,300 | — | ||||||||
Payments of equity offering costs | (1,281) | (821) | ||||||||
Payments of warrant issuance costs | (1,640) | — | ||||||||
Borrowings on other long-term loans | 3,140 | — | ||||||||
Borrowings under term loan | — | 2,500 | ||||||||
Principal payment on term loan | (700) | — | ||||||||
Borrowings on credit facility | 3,000 | — | ||||||||
Repayment of credit facility | (3,000) | — | ||||||||
Payment of debt issuance costs | (128) | (133) | ||||||||
Proceeds from the exercise of common stock warrants | 46 | — | ||||||||
Proceeds from exercise of stock options | — | 4 | ||||||||
Net cash and cash equivalents provided by financing activities | 24,349 | 10,721 | ||||||||
Effect of exchange rate changes | 317 | (23) | ||||||||
Decrease in cash, cash equivalents and restricted cash | 11,775 | (2,255) | ||||||||
Cash, cash equivalents and restricted cash, beginning of period | 6,101 | 8,356 | ||||||||
Cash, cash equivalents and restricted cash, end of period | $ | 17,876 | $ | 6,101 | ||||||
Supplemental cash flow disclosure: | ||||||||||
Cash paid for interest | $ | 1,881 | $ | 1,784 | ||||||
Cash received for interest | $ | 11 | $ | — | ||||||
Cash paid for income taxes | $ | 22 | $ | 35 | ||||||
Cash paid for operating leases | $ | 489 | $ | 797 | ||||||
Non-cash accrual for capital expenditures | $ | — | $ | 18 | ||||||
Non-cash settlement of performance award liability | $ | 151 | $ | 201 | ||||||
Non-cash right-of-use assets obtained in exchange for lease obligation | $ | 2,037 | $ | 276 | ||||||
Equity financing costs in accounts payable | $ | 74 | $ | 129 | ||||||
Deemed dividend on convertible preferred stock | $ | 17,378 | $ | — | ||||||
Forgiveness of debt | $ | 10 | $ | — | ||||||
Warrants exercised in other receivables | $ | 1,498 | $ | — | ||||||
Warrants issued in connection with debt instruments | $ | 67 | $ | 161 | ||||||
Non-GAAP Disclosure
In addition to the financial information prepared in conformity with generally accepted accounting principles in the U.S. ("GAAP"), this press release includes certain historical non-GAAP financial information. Management believes that these non-GAAP financial measures assist investors in making comparisons of period-to-period operating results and that, in some respects, these non-GAAP financial measures are more indicative of the Company's ongoing core operating performance than their GAAP equivalents. In 2019, the Company revised its non-GAAP financial measures to include the change in allowance for doubtful accounts in an effort to better align its Adjusted EBITDA with its loan covenants and how management evaluates business performance.
Adjusted EBITDA is defined as net income (loss) before interest, taxes, depreciation and amortization, stock-based compensation, and allowance for doubtful accounts. Management uses Adjusted EBITDA in its evaluation of the Company's core results of operations and trends between fiscal periods and believes that these measures are important components of its internal performance measurement process. Therefore, investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Further, the non-GAAP financial measures presented by the Company may be different from similarly named non-GAAP financial measures used by other companies.
BIOLASE, INC. | |||||||||||||||||||
Reconciliation of GAAP Net Loss to Adjusted EBITDA | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(In thousands, except per share data) | |||||||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||||||
December 31, | December 31, | ||||||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||||||
GAAP net loss attributable to common stockholders | $ | (6,142) | $ | (3,587) | $ | (34,207) | $ | (17,855) | |||||||||||
Deemed dividend on convertible preferred stock | — | — | 17,378 | — | |||||||||||||||
GAAP net income (loss) | $ | (6,142) | $ | (3,587) | $ | (16,829) | $ | (17,855) | |||||||||||
Adjustments: | |||||||||||||||||||
Interest expense, net | 577 | 598 | 2,359 | 2,157 | |||||||||||||||
Income tax (benefit) provision | 79 | (112) | 128 | (44) | |||||||||||||||
Depreciation and amortization | (28) | 228 | 499 | 982 | |||||||||||||||
Change in allowance for doubtful accounts | 65 | 452 | 1,328 | 1,695 | |||||||||||||||
Stock-based compensation | 1,003 | 768 | 3,370 | 2,742 | |||||||||||||||
Other (income) expense, net | (6) | — | (4,215) | — | |||||||||||||||
Adjusted EBITDA | $ | (4,452) | $ | (1,653) | $ | (13,360) | $ | (10,323) | |||||||||||
GAAP net loss attributable to common stockholders per share, basic and diluted | $ | (0.07) | $ | (0.13) | $ | (0.56) | $ | (0.77) | |||||||||||
Deemed dividend on convertible preferred stock | — | — | 0.28 | — | |||||||||||||||
GAAP net income (loss) per share, basic and diluted | $ | (0.07) | $ | (0.13) | $ | (0.28) | $ | (0.77) | |||||||||||
Adjustments: | |||||||||||||||||||
Interest expense, net | 0.01 | 0.02 | 0.04 | 0.09 | |||||||||||||||
Income tax (benefit) provision | — | — | — | — | |||||||||||||||
Depreciation and amortization | — | 0.01 | 0.01 | 0.04 | |||||||||||||||
Change in allowance for doubtful accounts | — | 0.02 | 0.02 | 0.07 | |||||||||||||||
Stock-based compensation | 0.01 | 0.03 | 0.06 | 0.12 | |||||||||||||||
Other (income) expense, net | — | — | (0.07) | — | |||||||||||||||
Adjusted EBITDA per share, basic and diluted | $ | (0.05) | $ | (0.05) | $ | (0.22) | $ | (0.45) | |||||||||||
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SOURCE BIOLASE, Inc.
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