Co-Diagnostics, Inc. Reports Full Year 2023 Financial Results
- Revenue of $6.8 million in 2023, down from $34.2 million in the prior year
- Operating expenses decreased to $45.3 million
- Operating loss of $42.7 million in 2023
- Net loss of $35.3 million, with an adjusted EBITDA loss of $33.0 million
- Completed clinical evaluations for the new Co-Dx PCR platform
- Submitted EUA to FDA for Co-Dx PCR Pro instrument and COVID-19 test kit
- Received grant funding of $12.6 million for test development activities
- Appointed Ivory Chang as Chief Regulatory Affairs Officer
- Built new manufacturing facility to support test production
- Revenue decline due to lower demand for COVID-19 tests
- Significant increase in operating loss compared to the prior year
- Net loss of $35.3 million in 2023
- Adjusted EBITDA loss of $33.0 million
- Challenges in financial performance
Insights
The reported decline in revenue for Co-Diagnostics, Inc. from $34.2 million to $6.8 million, a significant drop year-over-year, is indicative of the volatility in demand for COVID-19 related products. As the pandemic situation evolves, the need for such tests is decreasing, impacting companies that thrived during the peak of COVID-19. The financial health of Co-Diagnostics is a concern, evidenced by the operating loss widening from $27.0 million to $42.7 million. The share repurchase program seems to be an attempt to signal confidence in the company's future, yet it contrasts with the substantial net loss. Looking forward, the success of the new Co-Dx PCR platform, including the EUA submission for the Co-Dx PCR Pro instrument, could be pivotal. However, the market for at-home testing is highly competitive and regulatory approval is uncertain. The expansion of manufacturing capabilities is a strategic move, potentially reducing costs and preparing for increased production should their new tests gain market traction.
From a financial perspective, the significant net loss increase to $35.3 million raises concerns about Co-Diagnostics' profitability and cash burn rate. The adjusted EBITDA loss of $33.0 million further underscores the company's current lack of operational profitability. Despite this, the company's cash reserves of $58.5 million provide a cushion for continued research and development. Investors should note the grants totaling $12.6 million, which offset some R&D costs and signal institutional support for the company's test development. The strategic appointment of Ivory Chang as Chief Regulatory Affairs Officer could streamline the regulatory process, potentially reducing the time to market for new products. The stock repurchase at an average price of $1.41 per share also presents a mixed signal, as it may reflect management's belief in undervaluation or alternatively, a lack of better investment opportunities for the company's capital.
The clinical evaluations and regulatory submissions for Co-Diagnostics' new testing platforms, including tests for tuberculosis, upper respiratory infections and HPV, reflect the company's pivot from COVID-19 to other infectious diseases. The NIH and Bill and Melinda Gates Foundation grants suggest that the company's research is aligned with broader public health goals. However, the actual impact on the company's bottom line will depend on the successful commercialization of these tests. The expansion of the manufacturing facility in Salt Lake City and the planned capacity in India for test cup and instrument manufacturing are strategic for scaling up production. However, the regulatory challenges faced by in-vitro diagnostics, especially for at-home tests, should not be underestimated. The success of the EUA submission for the Co-Dx PCR Pro instrument and associated tests will be critical for the company's future revenue streams and market position.
Full Year 2023 Financial Results:
- Revenue of
$6.8 million $34.2 million $5.8 million $1.0 million - Operating expenses of
$45.3 million 18.6% from the prior year due to goodwill impairment charges in the prior year, offset by an increase in research and development costs incurred for the development of our Co-Dx™ PCR platform in the current year - Operating loss of
$42.7 million $27.0 million - Net loss of
$35.3 million $14.2 million $1.20 $0.45 - Adjusted EBITDA loss of
$33.0 million - Repurchased approximately 967,000 shares of common stock at an average price of
$1.41 $1.4 million - Cash, cash equivalents, and marketable securities of
$58.5 million
Full Year 2023 Business Highlights:
- Initiated and completed the clinical evaluations for the first test on the new Co-Dx PCR point-of-care and at-home platform
- Submitted an EUA to the FDA in December for our Co-Dx PCR Pro™ instrument, mobile app, and Co-Dx COVID-19 test kit
- Awarded grant funding in the aggregate amount of approximately
$12.6 million - Three awards from the Bill and Melinda Gates Foundation to support the development of tuberculosis and HPV tests and expansion of manufacturing capacity; and
- An award from the NIH as part of the Rapid Acceleration of Diagnostics (RADx®) Tech program for upper respiratory multiplex panel
- Appointed Ivory Chang as Chief Regulatory Affairs Officer. Ms. Chang previously worked at multiple large, renowned diagnostic companies, and brings many years of experience to Co-Diagnostics in in-vitro diagnostic product and point-of-care regulatory submissions
- Built out new manufacturing facility which will serve to support production of our test cups and Co-Dx PCR Pro instruments
"We are pleased to have made great progress towards our strategic goals in the fourth quarter, highlighted by an Emergency Use Authorization submission to the FDA for our Co-Dx PCR Pro™ instrument, mobile app, and COVID-19 test," said Dwight Egan, Co-Diagnostics' Chief Executive Officer. "We believe that our EUA submission will serve as a steppingstone in our effort to decentralize PCR diagnostics and to expand to the point-of-care and at-home settings. Co-Diagnostics' investment in additional production capacity in
"We remain excited for 2024 and look forward to providing updates on our test development and platform. Co-Diagnostics plans to continue the development of our TB, multiplex respiratory, and HPV tests throughout the year," said Brian Brown, Co-Diagnostics' Chief Financial Officer.
Conference Call and Webcast
Co-Diagnostics will host a conference call and webcast at 4:30 p.m. EDT today to discuss its financial results with analysts and institutional investors. The conference call and webcast will be available via:
Webcast: ir.co-dx.com on the Events & Webcasts page
Conference Call: 844-481-2661 (domestic) or 412-317-0652 (international)
The call will be recorded and later made available on the Company's website: https://co-dx.com.
*The Co-Dx PCR platform (including the PCR Home™, PCR Pro™, mobile app, and all associated tests) is subject to review by the FDA and/or other regulatory bodies and is not yet available for sale. The Co-Dx PCR Pro instrument and Co-Dx COVID-19 Test are currently under review by the FDA.
About Co-Diagnostics, Inc.:
Co-Diagnostics, Inc., a
Non-GAAP Financial Measures:
This press release contains adjusted EBITDA, which is a non-GAAP measure defined as net income excluding depreciation, amortization, income tax (benefit) expense, net interest (income) expense, stock-based compensation, and one-time transaction related costs. The Company believes that adjusted EBITDA provides useful information to management and investors relating to its results of operations. The Company's management uses this non-GAAP measure to compare the Company's performance to that of prior periods for trend analyses, and for budgeting and planning purposes. The Company believes that the use of adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company's financial measures with other companies, many of which present similar non-GAAP financial measures to investors, and that it allows for greater transparency with respect to key metrics used by management in its financial and operational decision-making.
Management does not consider the non-GAAP measure in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of the non-GAAP financial measure is that it excludes significant expenses that are required by GAAP to be recorded in the Company's financial statements. In order to compensate for these limitations, management presents the non-GAAP financial measure together with GAAP results. Non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. A reconciliation table of the net income, the most comparable GAAP financial measure to adjusted EBITDA, is included at the end of this release. The Company urges investors to review the reconciliation and not to rely on any single financial measure to evaluate the company's business.
Forward-Looking Statements:
This press release contains forward-looking statements. Forward-looking statements can be identified by words such as "believes," "expects," "estimates," "intends," "may," "plans," "will" and similar expressions, or the negative of these words. Such forward-looking statements are based on facts and conditions as they exist at the time such statements are made and predictions as to future facts and conditions. Forward-looking statements in this release include statements regarding (i) continued development and FDA submissions for the Co-Dx PCR platform and (ii) our belief that our EUA submission will serve as a steppingstone in our effort to decentralize PCR diagnostics and to expand to the point-of-care and at-home settings. Forward-looking statements are subject to inherent uncertainties, risks and changes in circumstances. Actual results may differ materially from those contemplated or anticipated by such forward-looking statements. Readers of this press release are cautioned not to place undue reliance on any forward-looking statements. There can be no assurance that any of the anticipated results will occur on a timely basis or at all due to certain risks and uncertainties, a discussion of which can be found in our Risk Factors disclosure in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (SEC) on March 14, 2024, and in our other filings with the SEC. The Company does not undertake any obligation to update any forward-looking statement relating to matters discussed in this press release, except as may be required by applicable securities laws.
CO-DIAGNOSTICS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS | ||||||||
December 31, 2023 | December 31, 2022 | |||||||
Assets | ||||||||
Current assets | ||||||||
Cash and cash equivalents | $ | 14,916,878 | $ | 22,973,803 | ||||
Marketable investment securities | 43,631,510 | 58,289,066 | ||||||
Accounts receivable, net | 303,926 | 3,453,723 | ||||||
Inventory, net | 1,664,725 | 5,310,473 | ||||||
Income taxes receivable | 26,955 | 1,870,419 | ||||||
Prepaid expenses and other current assets | 1,597,114 | 761,187 | ||||||
Note receivable | - | 75,000 | ||||||
Total current assets | 62,141,108 | 92,733,671 | ||||||
Property and equipment, net | 3,035,729 | 2,539,483 | ||||||
Operating lease right-of-use asset | 2,966,774 | 372,115 | ||||||
Intangible assets, net | 26,403,667 | 26,768,333 | ||||||
Investment in joint venture | 773,382 | 672,679 | ||||||
Total assets | $ | 95,320,660 | $ | 123,086,281 | ||||
Liabilities and stockholders' equity | ||||||||
Current liabilities | ||||||||
Accounts payable | $ | 1,482,109 | $ | 952,296 | ||||
Accrued expenses, current | 2,172,959 | 934,447 | ||||||
Operating lease liability, current | 838,387 | 297,209 | ||||||
Contingent consideration liabilities, current | 891,666 | 1,689,471 | ||||||
Deferred revenue | 362,449 | - | ||||||
Total current liabilities | 5,747,570 | 3,873,423 | ||||||
Long-term liabilities | ||||||||
Income taxes payable | 659,186 | 1,181,284 | ||||||
Deferred tax liability | - | 2,417,987 | ||||||
Operating lease liability | 2,152,180 | 50,708 | ||||||
Contingent consideration liabilities | 748,109 | 1,042,885 | ||||||
Total long-term liabilities | 3,559,475 | 4,692,864 | ||||||
Total liabilities | 9,307,045 | 8,566,287 | ||||||
Commitments and contingencies (Note 12) | ||||||||
Stockholders' equity | ||||||||
Convertible preferred stock, | - | - | ||||||
Common stock, | 36,108 | 34,754 | ||||||
Treasury stock, at cost; 4,848,678 and 3,881,658 shares held as | (15,575,795) | (14,211,866) | ||||||
Additional paid-in capital | 96,808,436 | 88,472,935 | ||||||
Accumulated other comprehensive income (loss) | 146,700 | 293,140 | ||||||
Accumulated earnings | 4,598,166 | 39,931,031 | ||||||
Total stockholders' equity | 86,013,615 | 114,519,994 | ||||||
Total liabilities and stockholders' equity | $ | 95,320,660 | $ | 123,086,281 | ||||
CO-DIAGNOSTICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||||||||
Years Ended December 31, | ||||||||
2023 | 2022 | |||||||
Product revenue | $ | 991,473 | $ | 34,218,209 | ||||
Grant revenue | 5,820,565 | - | ||||||
Total revenue | 6,812,038 | 34,218,209 | ||||||
Cost of revenue | 4,184,949 | 5,481,093 | ||||||
Gross profit | 2,627,089 | 28,737,116 | ||||||
Operating expenses | ||||||||
Sales and marketing | 6,860,815 | 7,344,628 | ||||||
General and administrative | 14,279,441 | 14,262,963 | ||||||
Research and development | 22,962,593 | 17,438,098 | ||||||
Depreciation and amortization | 1,230,474 | 1,282,718 | ||||||
Goodwill impairment charges | - | 15,388,546 | ||||||
Total operating expenses | 45,333,323 | 55,716,953 | ||||||
Loss from operations | (42,706,234) | (26,979,837) | ||||||
Other income, net | ||||||||
Interest income | 1,161,913 | 704,045 | ||||||
Realized gain on investments | 2,243,059 | - | ||||||
Loss on disposition of assets | (2,578) | (138,117) | ||||||
Gain on remeasurement of acquisition contingencies | 1,092,581 | 7,899,644 | ||||||
Gain (loss) on equity method investment in joint venture | 100,703 | (332,969) | ||||||
Total other income, net | 4,595,678 | 8,132,603 | ||||||
Loss before income taxes | (38,110,556) | (18,847,234) | ||||||
Income tax benefit | (2,777,691) | (4,608,985) | ||||||
Net loss | $ | (35,332,865) | $ | (14,238,249) | ||||
Other comprehensive loss | ||||||||
Change in net unrealized gains on marketable securities, net of tax | $ | (146,440) | $ | 293,140 | ||||
Total other comprehensive income (loss) | $ | (146,440) | $ | 293,140 | ||||
Comprehensive loss | $ | (35,479,305) | $ | (13,945,109) | ||||
Loss per common share: | ||||||||
Basic | $ | (1.20) | $ | (0.45) | ||||
Diluted | $ | (1.20) | $ | (0.45) | ||||
Weighted average shares outstanding: | ||||||||
Basic | 29,346,599 | 31,479,028 | ||||||
Diluted | 29,346,599 | 31,479,028 | ||||||
CO-DIAGNOSTICS, INC. AND SUBSIDIARIES GAAP AND NON-GAAP MEASURES
| ||||||||
Reconciliation of net loss to adjusted EBITDA: | ||||||||
Years Ended December 31, | ||||||||
2023 | 2022 | |||||||
Net loss | $ | (35,332,865) | $ | (14,238,249) | ||||
Interest income | (1,161,913) | (704,045) | ||||||
Realized gain on investments | (2,243,059) | - | ||||||
Depreciation and amortization | 1,230,474 | 1,282,718 | ||||||
Transaction costs | 310 | 139,342 | ||||||
Change in fair value of contingent consideration | (1,092,581) | (7,899,644) | ||||||
Stock-based compensation expense | 8,336,855 | 7,543,223 | ||||||
Income tax benefit | (2,777,691) | (4,608,985) | ||||||
Goodwill impairment charges | - | 15,388,546 | ||||||
Adjusted EBITDA | $ | (33,040,470) | $ | (3,097,094) | ||||
Reconciliation of net loss to adjusted net income (loss): | ||||||||
Years Ended December 31, | ||||||||
2023 | 2022 | |||||||
Net income (loss) | $ | (35,332,865) | $ | (14,238,249) | ||||
Goodwill impairment charges | - | 15,388,546 | ||||||
Adjusted net income (loss) | $ | (35,332,865) | $ | 1,150,297 | ||||
View original content to download multimedia:https://www.prnewswire.com/news-releases/co-diagnostics-inc-reports-full-year-2023-financial-results-302089736.html
SOURCE Co-Diagnostics
FAQ
What was Co-Diagnostics' revenue in 2023?
What were the operating expenses in 2023?
What was the net loss in 2023?
What milestones did Co-Diagnostics achieve in 2023?
Who was appointed as Chief Regulatory Affairs Officer?
