Evolus Reports First Quarter 2023 Results and Provides Business Update
-
Q1 2023 Net Revenue of
, Up$41.7 Million 23% from Q1 2022 -
Reaffirms Full-Year 2023 Net Revenue Guidance of
to$180 $190 Million -
Raises 2028 Revenue Outlook from
to$500 Million Driven by Addition of Evolysse™ Dermal Filler Line Representing a$700 Million 29% CAGR -
Fully Funded to Profitability, Including the Dermal Filler Investment, by Utilizing Remaining
of Pharmakon Credit Facility$50 Million
“Following a record 2022, Evolus is off to a strong start to the year, reporting
Moatazedi continued, “Earlier this year we guided to
First Quarter 2023 Highlights and Recent Developments
-
The company’s key sales and marketing metrics demonstrated continued strong momentum during the first quarter.
-
Evolus added more than 600 new customer accounts in the quarter, bringing the total number of customers purchasing since launch to more than 10,000. The reorder rate among customers remains above
70% .2 - Enrollment in the Evolus Rewards consumer loyalty program grew by more than 60,000 members to 570,000.3
-
Total redemptions for the quarter hit an all-time high of nearly 140,000 as existing users continued to return for repeat treatments of Jeuveau® at a rate of
60% , demonstrating sustained brand loyalty.
-
Evolus added more than 600 new customer accounts in the quarter, bringing the total number of customers purchasing since launch to more than 10,000. The reorder rate among customers remains above
-
Evolus continued to broaden its international presence beyond
Canada andGreat Britain with the recently announced launch of Nuceiva® inGermany andAustria .
First Quarter 2023 Financial Results
-
Total net revenues for the first quarter of 2023 increased
23% to from$41.7 million in the first quarter of 2022 driven primarily by higher volumes of Jeuveau® and a modestly higher average selling price.$33.9 million -
Gross profit margin and adjusted gross profit margin were
69.1% and70.9% , respectively. Adjusted gross profit margin, which excludes amortization of intangible assets, was in line with company guidance. -
Operating expenses for the first quarter of 2023 were
compared to$53.8 million in the fourth quarter of 2022.$54.3 million -
Non-GAAP operating expenses for the first quarter of 2023 were
compared to$35.5 million in the fourth quarter of 2022. Non-GAAP operating expenses exclude product cost of sales, stock-based compensation expense, revaluation of the contingent royalty obligation, and depreciation and amortization.$35.7 million -
Loss from operations was
in the first quarter of 2023 compared to$12.0 million in the fourth quarter of 2022. Non-GAAP loss from operations in the first quarter of 2023 was$10.6 million compared to$5.9 million in the fourth quarter of 2022. Non-GAAP loss from operations excludes stock-based compensation expense, revaluation of the contingent royalty obligation, and depreciation and amortization.$5.4 million -
Cash and cash equivalents at March 31, 2023 were
, compared to$31.5 million at December 31, 2022. For the first quarter of 2023, net cash used for operating activities was$53.9 million , which included the final settlement payment of$20.6 million under the Medytox Settlement Agreement. Net cash used for operating activities in the first quarter of 2023 was lower than the first quarter of 2022, representing continued progress toward cash flow breakeven. Managing operating expenses and cash remain high priorities for the company.$5.0 million
Outlook
-
Evolus continues to expect total net revenues for the full year 2023 to be between
and$180 million , representing year-over-year growth of$190 million 21% to28% and more than double the estimated growth rate of the aesthetic neurotoxin market. The company also assumes a return to industry seasonal revenue patterns. -
The company expects its adjusted gross profit margin for the full year 2023 to be between
68% and71% . -
Evolus now expects its full-year non-GAAP operating expenses to be between
and$153 million . The increase from previous guidance is related to the investments associated with the dermal filler launch including the up-front payment of$158 million €4.1 million as described in the terms of the distribution agreement. - The company now expects to achieve positive non-GAAP operating income on a consolidated basis in 2025.
-
The company is fully funded to profitability4, including the dermal filler investment, by utilizing the remaining
tranche of its existing credit facility with Pharmakon Advisors.$50 million -
The company now projects its total net revenue3 can reach
by 2028, a compound annual growth rate of$700 million 29% , based on the combination of its existing aesthetic neurotoxin business and anticipated launch of the Evolysse™ HA dermal filler product line beginning in 2025.
Conference Call Information
Management will host a conference call and live webcast to discuss Evolus’ financial results today at 4:30 p.m. ET. To participate in the conference call, dial (877) 407-6184 (
Following the completion of the call, an audio replay can be accessed for 48 hours by dialing (877) 660-6853 (
About Evolus, Inc.
Evolus (Nasdaq: EOLS) is a performance beauty company evolving the aesthetic neurotoxin market for the next generation of beauty consumers through its unique, customer-centric business model and innovative digital platform. Our mission is to become a global, multi-product aesthetics company based on our flagship product, Jeuveau® (prabotulinumtoxinA-xvfs), the first and only neurotoxin dedicated exclusively to aesthetics and manufactured in a state-of-the-art facility using Hi-Pure™ technology. Visit us at www.evolus.com, and follow us on LinkedIn, Twitter, Instagram or Facebook.
Forward-Looking Statements
This press release contains forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties, including statements about future events, our business, financial condition, results of operations and prospects, our industry and the regulatory environment in which we operate. Any statements contained herein that are not statements of historical or current facts are forward-looking statements. In some cases, you can identify forward-looking statements by terms such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” or the negative of those terms, or other comparable terms intended to identify statements about the future. The company’s forward-looking statements include, but are not limited to, statements related to market conditions and consumer demand; financial and other benefits expected from the exclusive
The forward-looking statements included herein are based on our current expectations, assumptions, estimates and projections, which we believe to be reasonable, and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties, all of which are difficult or impossible to predict accurately and many of which are beyond our control, include, but are not limited to uncertainties associated with our ability to comply with the terms and conditions in the Medytox Settlement Agreements, our ability to fund our future operations or obtain financing to fund our operations, unfavorable global economic conditions and the impact on consumer discretionary spending, uncertainties related to customer and consumer adoption of Jeuveau® and Evolysse™, the efficiency and operability of our digital platform, competition and market dynamics, our ability to successfully launch and commercialize our products in new markets, including the Evolysse™ dermal filler product line in the
Use of Non-GAAP Financial Measures
Evolus’ financial results are prepared in accordance with accounting principles generally accepted in
For a reconciliation of our historical adjusted gross profit margin, non-GAAP operating expenses and non-GAAP loss from operations presented herein to gross profit margin, GAAP operating expenses and GAAP loss from operations, the most directly comparable GAAP financial measures, please see “Reconciliation of Gross Profit Margin to Adjusted Gross Profit Margin,” “Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses” and “Reconciliation of GAAP (Loss) from Operations to Non-GAAP (Loss) from Operations” in the financial schedules below. In addition, this press release includes information regarding the company’s expected adjusted gross profit margin and non-GAAP operating expenses for full year 2023. Evolus has not provided a reconciliation of such forward-looking non-GAAP adjusted gross profit margin or non-GAAP operating expenses because a reconciliation of such measures to GAAP gross profit margin, and GAAP operating expenses, respectively, the most directly comparable GAAP financial measures, is not available without unreasonable efforts. This is due to the inherent difficulty of forecasting the timing or amount of various reconciling items that would impact the forward-looking outlook for these non-GAAP financial measures that have not yet occurred and/or cannot be reasonably predicted. Such unavailable information could have a significant impact on Evolus’ GAAP financial results.
Jeuveau® and Nuceiva® are registered trademarks of Evolus, Inc.
Evolysse™ is a trademark of Evolus, Inc.
Hi-Pure™ is a trademark of Daewoong Pharmaceutical Co, Ltd.
1 |
Source: Medical Insights Dermal Filler Market Study, March 2023 (www.miinews.com), BCG Aesthetic Research presented at IMCAS 2023 and company estimates. |
|
2 |
Represents cumulative statistics from the launch of Jeuveau® in May 2019 through March 31, 2023. |
|
3 |
Represents cumulative statistics from the launch of Evolus Rewards in May 2020 through March 31, 2023. |
|
4 |
Within this press release, “profitability” is defined as achieving positive non-GAAP operating income. |
Evolus, Inc. Consolidated Statements of Operations and Comprehensive Loss (Unaudited, in thousands, except loss per share data) |
|||||||
|
Three Months Ended
|
||||||
|
|
2023 |
|
|
|
2022 |
|
Revenue: |
|
|
|
||||
Product revenue, net |
$ |
41,047 |
|
|
$ |
33,226 |
|
Service revenue |
|
674 |
|
|
|
682 |
|
Total net revenues |
|
41,721 |
|
|
|
33,908 |
|
|
|
|
|
||||
Operating expenses: |
|
|
|
||||
Product cost of sales (excludes amortization of intangible assets) |
|
12,146 |
|
|
|
13,208 |
|
Selling, general and administrative |
|
37,384 |
|
|
|
33,442 |
|
Research and development |
|
1,381 |
|
|
|
468 |
|
Revaluation of contingent royalty obligation payable to Evolus Founders |
|
1,648 |
|
|
|
1,316 |
|
Depreciation and amortization |
|
1,202 |
|
|
|
922 |
|
Total operating expenses |
|
53,761 |
|
|
|
49,356 |
|
Loss from operations |
|
(12,040 |
) |
|
|
(15,448 |
) |
Other income (expense): |
|
|
|
||||
Interest income |
|
99 |
|
|
|
— |
|
Interest expense |
|
(2,789 |
) |
|
|
(2,048 |
) |
Other expense, net |
|
(38 |
) |
|
|
(7 |
) |
Loss before income taxes: |
|
(14,768 |
) |
|
|
(17,503 |
) |
Income tax expense (benefit) |
|
23 |
|
|
|
(2 |
) |
Net loss |
$ |
(14,791 |
) |
|
$ |
(17,501 |
) |
Other comprehensive loss: |
|
|
|
||||
Unrealized loss, net of tax |
|
(79 |
) |
|
|
(103 |
) |
Comprehensive loss |
$ |
(14,870 |
) |
|
$ |
(17,604 |
) |
Net loss per share, basic and diluted |
$ |
(0.26 |
) |
|
$ |
(0.31 |
) |
Weighted-average shares outstanding used to compute basic and diluted net loss per share |
|
56,476 |
|
|
|
55,731 |
|
Evolus, Inc. Summary of Consolidated Balance Sheet Data (Unaudited, in thousands) |
|||||
|
March 31, 2023 |
|
December 31, 2022 |
||
Cash and cash equivalents |
$ |
31,463 |
|
$ |
53,922 |
Accounts receivable, net |
|
23,455 |
|
|
22,448 |
Inventories |
|
23,418 |
|
|
18,852 |
Prepaid expenses and other current assets |
|
5,749 |
|
|
5,580 |
Total current assets |
|
84,085 |
|
|
100,802 |
Noncurrent assets |
|
76,150 |
|
|
77,181 |
Total assets |
$ |
160,235 |
|
$ |
177,983 |
Accounts payable and accrued expenses |
$ |
32,294 |
|
$ |
33,729 |
Accrued litigation settlement |
|
— |
|
|
5,000 |
Other current liabilities |
|
8,384 |
|
|
7,780 |
Total current liabilities |
|
40,678 |
|
|
46,509 |
Term loan, net of discount and issuance costs |
|
72,046 |
|
|
71,879 |
Other noncurrent liabilities |
|
40,562 |
|
|
41,096 |
Total liabilities |
$ |
153,286 |
|
$ |
159,484 |
Total stockholders’ equity |
$ |
6,949 |
|
$ |
18,499 |
Evolus, Inc. Summary of Consolidated Cash Flows (Unaudited, in thousands) |
||||||||
|
Three Months Ended March 31, |
|||||||
|
|
2023 |
|
|
|
2022 |
|
|
Net cash used in: |
|
|
|
|
||||
Operating activities |
$ |
(20,587 |
) |
* |
$ |
(38,199 |
) |
* |
Investing activities |
|
(511 |
) |
|
|
(261 |
) |
|
Financing activities |
|
(1,282 |
) |
|
|
(1,022 |
) |
|
Effect of exchange rates on cash |
|
(79 |
) |
|
|
(103 |
) |
|
Change in cash and cash equivalents |
|
(22,459 |
) |
|
|
(39,585 |
) |
|
Cash and cash equivalents, beginning of period |
|
53,922 |
|
|
|
146,256 |
|
|
Cash and cash equivalents, end of period |
$ |
31,463 |
|
|
$ |
106,671 |
|
|
*Includes a settlement payment of
Evolus, Inc. Reconciliation of Gross Profit Margin to Adjusted Gross Profit Margin (Unaudited, in thousands) |
|||||||
|
Three Months Ended March 31, |
||||||
|
|
2023 |
|
|
|
2022 |
|
Total net revenues |
$ |
41,721 |
|
|
$ |
33,908 |
|
Cost of sales: |
|
|
|
||||
Product cost of sales (excludes amortization of intangible assets) |
|
12,146 |
|
|
|
13,208 |
|
Amortization of distribution right intangible asset |
|
739 |
|
|
|
739 |
|
Total cost of sales |
|
12,885 |
|
|
|
13,947 |
|
Gross profit |
|
28,836 |
|
|
|
19,961 |
|
Gross profit margin |
|
69.1 |
% |
|
|
58.9 |
% |
Add: Amortization of distribution right intangible asset |
|
739 |
|
|
|
739 |
|
Adjusted gross profit |
$ |
29,575 |
|
|
$ |
20,700 |
|
Adjusted gross profit margin |
|
70.9 |
% |
|
|
61.0 |
% |
Evolus, Inc. Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses (Unaudited, in thousands) |
||||||||
|
Three Months Ended March 31, |
|
Three Months Ended December 31, |
|||||
|
|
2023 |
|
|
2022 |
|
|
2022 |
GAAP operating expense |
$ |
53,761 |
|
$ |
49,356 |
|
$ |
54,283 |
Adjustments: |
|
|
|
|
|
|||
Product cost of sales (excludes amortization of intangible assets) |
|
12,146 |
|
|
13,208 |
|
|
13,370 |
Revaluation of contingent royalty obligation |
|
1,648 |
|
|
1,316 |
|
|
1,809 |
Stock-based compensation: |
|
|
|
|
|
|||
Included in selling, general and administrative |
|
3,167 |
|
|
2,914 |
|
|
2,329 |
Included in research and development |
|
127 |
|
|
45 |
|
|
83 |
Depreciation and amortization |
|
1,202 |
|
|
922 |
|
|
1,027 |
Non-GAAP operating expense |
$ |
35,471 |
|
$ |
30,951 |
|
$ |
35,665 |
Evolus, Inc. Reconciliation of GAAP (Loss) from Operations to Non-GAAP (Loss) from Operations (Unaudited, in thousands) |
|||||||||||
|
Three Months Ended March 31, |
|
Three Months Ended December 31, |
||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2022 |
|
GAAP (loss) from operations |
$ |
(12,040 |
) |
|
$ |
(15,448 |
) |
|
$ |
(10,637 |
) |
Adjustments: |
|
|
|
|
|
||||||
Revaluation of contingent royalty obligation |
|
1,648 |
|
|
|
1,316 |
|
|
|
1,809 |
|
Stock-based compensation: |
|
|
|
|
|
||||||
Included in selling, general and administrative |
|
3,167 |
|
|
|
2,914 |
|
|
|
2,329 |
|
Included in research and development |
|
127 |
|
|
|
45 |
|
|
|
83 |
|
Depreciation and amortization |
|
1,202 |
|
|
|
922 |
|
|
|
1,027 |
|
Non-GAAP (loss) from operations |
$ |
(5,896 |
) |
|
$ |
(10,251 |
) |
|
$ |
(5,389 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230509006062/en/
Investor Contact:
David K. Erickson
Vice President, Investor Relations
Tel: 949-966-1798
Email: david.erickson@evolus.com
Media Contact:
Email: media@evolus.com
Source: Evolus