MYOS RENS Technology Announces Net Revenues Increase 39% for the Three Months Ended September 30, 2020
MYOS RENS Technology, known for Fortetropin®, reported Q3 2020 financial results with a revenue increase of 39% to $485K, driven by its Canine Muscle Formula. Despite a 4% drop in operating expenses, costs surged 42% due to increased sales. Gross profit rose by 35% to $237K. Year-to-date, revenues jumped 69% to $1.1M. Operating losses narrowed by 26% to $2.4M. MYOS is preparing for a merger with MedAvail, with a shareholder vote scheduled for November 16, 2020, aiming for enhanced operational efficiencies and shareholder value.
- Q3 2020 revenues increased by $135K or 39% year-over-year.
- Gross profit rose by $61K or 35% compared to Q3 2019.
- Operating expenses decreased by $42K or 4%, showcasing cost management.
- Year-to-date revenues up 69% to $1.1M compared to the same period in 2019.
- Merger with MedAvail expected to strengthen balance sheet and reduce expenses.
- Cost of revenues increased by $74K or 42%, impacting margins.
- Operating loss for Q3 was $808K, though improved from $911K in Q3 2019.
- Net loss for the nine months ended September 30, 2020, was $2.45M, although reduced from $3.07M in the prior year.
CEDAR KNOLLS, N.J., Nov. 6, 2020 /PRNewswire/ -- MYOS RENS Technology Inc. ("MYOS" or the "Company") (NASDAQ: MYOS), an advanced nutrition company and the owner of Fortetropin®, a proprietary bioactive composition that helps build lean muscle, announced today its results for the three and nine months ended September 30, 2020.
"Q3 results have shown that Myos met the challenges of the new and uncertain "normal" with sensitivity, creativity and smarter, more aggressive marketing which helped us build deeper business relationships with our customers. This resulted in a significant increase in revenues while decreasing expenses during the quarter," said Joseph Mannello, CEO of MYOS. "These challenges have brought out the best in our staff and set the bar for even greater future results."
FINANCIAL HIGHLIGHTS
Three Months Ended September 30, 2020 Compared to September 30, 2019
Net revenues for the three months ended September 30, 2020 increased by
Cost of revenues for the three months ended September 30, 2020 increased by
Gross profit increased
Operating expenses for the three months ended September 30, 2020 decreased by
(amounts in thousands) | Three Months Ended | Change | ||||||||||||||
2020 | 2019 | Dollars | % | |||||||||||||
Net revenues | $ | 485 | $ | 350 | $ | 135 | 39 | % | ||||||||
Cost of revenues | 248 | 174 | 74 | 42 | % | |||||||||||
Gross profit | 237 | 176 | 61 | 35 | % | |||||||||||
Operating expenses: | ||||||||||||||||
Selling, marketing and research | 233 | 339 | (106) | -31 | % | |||||||||||
Personnel and benefits | 393 | 406 | (13) | -3 | % | |||||||||||
General and administrative | 419 | 342 | 77 | 18 | % | |||||||||||
Total operating expenses | 1,045 | 1,087 | (42) | -4 | % | |||||||||||
Operating loss | (808) | (911) | 103 | -21 | % | |||||||||||
Interest expense | (7) | (10) | 3 | -30 | % | |||||||||||
Net loss | $ | (815) | $ | (921) | $ | 106 | -12 | % | ||||||||
Nine Months Ended September 30, 2020 Compared to September 30, 2019
Net revenues for the nine months ended September 30, 2020 increased by
Cost of revenues for the nine months ended September 30, 2020 increased by
Gross profit increased
Operating expenses for the nine months ended September 30, 2020 decreased by
(amounts in thousands) | Nine Months Ended | Change | ||||||||||||||
2020 | 2019 | Dollars | % | |||||||||||||
Net revenues | $ | 1,104 | $ | 653 | $ | 451 | 69 | % | ||||||||
Cost of revenues | 578 | 316 | 262 | 83 | % | |||||||||||
Gross profit | 526 | 337 | 189 | 56 | % | |||||||||||
Operating expenses: | ||||||||||||||||
Selling, marketing and research | 662 | 951 | (289) | -30 | % | |||||||||||
Personnel and benefits | 1,226 | 1,226 | - | - | ||||||||||||
General and administrative | 1,063 | 1,200 | (137) | -11 | % | |||||||||||
Total operating expenses | 2,951 | 3,377 | (426) | -13 | % | |||||||||||
Operating loss | (2,425) | (3,040) | 615 | -26 | % | |||||||||||
Interest expense | (27) | (31) | 4 | -11 | % | |||||||||||
Net loss | $ | (2,452) | $ | (3,071) | $ | 619 | -20 | % | ||||||||
BUSINESS HIGHLIGHTS:
"It was a great quarter for Myos," said Mr. Mannello. "Our team was able to grow revenues in each vertical while decreasing unnecessary expenses. There is an art to leveraging spend to get the most ROI, and we hit the sweet spot in Q3. Our momentum continues to build as our foundation gets stronger.
OTHER HIGHLIGHTS:
- Appointed the S3 Agency to implement public relations and social media efforts around the ability of Fortetropin®, MYOS' proprietary ingredient, to improve muscle health.
- Received approval from the American Association of Veterinary State Boards (AAVSB) to offer a Continuing Education Course to Veterinarians titled, "Nutritional Management of Canine Osteoarthritis" for 1 Credit Hour.
"On the corporate front, our merger with MedAvail is almost complete with the vote taking place on November 16th. This will give shareholders ownership in both an exciting public company, MedAvail, and a larger piece of a private company. Myos, as a private company, will have fewer expenses and a stronger balance sheet. As a significant shareholder in Myos I am very excited about the merger and what lies ahead for both companies.
"On November 16, 2020 there will be a virtual shareholder meeting for shareholders of record of October 2, 2020, to vote the proposals in the Proxy Statement/Prospectus/Information Statement filed with the U.S. Securities and Exchange Commission by MYOS on October 15, 2020 in connection with the merger with MedAvail.
"I want to thank all of you for your continued support and wish you and your families continued health and safety during these trying times," said Mr. Mannello.
MYOS RENS TECHNOLOGY INC. AND SUBSIDIARY | |||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||
(in thousands, except share and per share amounts) | |||||||
September 30, | December 31, | ||||||
2020 | 2019 | ||||||
ASSETS | (Unaudited) | ||||||
Current assets: | |||||||
Cash | $ | 791 | $ | 64 | |||
Accounts receivable, net | 60 | 5 | |||||
Inventories, net | 1,368 | 1,666 | |||||
Prepaid expenses | 94 | 23 | |||||
Total current assets | 2,313 | 1,758 | |||||
Operating lease right of use asset | 151 | 192 | |||||
Deferred offering costs | - | 95 | |||||
Fixed assets, net | 78 | 97 | |||||
Intangible assets, net | 739 | 896 | |||||
Total assets | $ | 3,281 | $ | 3,038 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 127 | $ | 277 | |||
Accrued expenses and other current liabilities | 4 | 230 | |||||
Operating lease liabilities – current portion | 62 | 46 | |||||
Related party promissory note payable and accrued interest | 661 | 1,159 | |||||
Total current liabilities | 854 | 1,712 | |||||
Long-term liabilities: | |||||||
Note Payable PPP loan | 310 | - | |||||
Operating lease liabilities – net of current portion | 95 | 146 | |||||
Total liabilities | 1,259 | 1,858 | |||||
Commitments and contingencies (Note 11) | |||||||
Stockholders' equity: | |||||||
Preferred stock, | |||||||
Common stock, | 12 | 9 | |||||
Additional paid-in capital | 43,787 | 40,496 | |||||
Accumulated deficit | (41,777) | (39,325) | |||||
Total stockholders' equity | 2,022 | 1,180 | |||||
Total liabilities and stockholders' equity | $ | 3,281 | $ | 3,038 | |||
MYOS RENS TECHNOLOGY INC. AND SUBSIDIARY | |||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||
(Unaudited; in thousands, except share and per share amounts) | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Net revenues | $ | 485 | $ | 350 | $ | 1,104 | 653 | ||||||||
Cost of revenues | 248 | 174 | 578 | 316 | |||||||||||
Gross profit | 237 | 176 | 526 | 337 | |||||||||||
Operating expenses: | |||||||||||||||
Selling, marketing and research | 233 | 339 | 662 | 951 | |||||||||||
Personnel and benefits | 393 | 406 | 1,226 | 1,226 | |||||||||||
General and administrative | 419 | 342 | 1,063 | 1,200 | |||||||||||
Total operating expenses | 1,045 | 1,087 | 2,951 | 3,377 | |||||||||||
Operating loss | (808) | (911) | (2,425) | (3,040) | |||||||||||
Interest expense, net | (7) | (10) | (27) | (31) | |||||||||||
Net loss | $ | (815) | $ | (921) | $ | (2,452) | $ | (3,071) | |||||||
Net loss per share attributable to common shareholders: | |||||||||||||||
Basic and diluted | $ | (0.07) | $ | (0.10) | $ | (0.22) | $ | (0.35) | |||||||
Weighted average number of common shares outstanding: | |||||||||||||||
Basic and diluted | 11,846,795 | 9,173,851 | 10,996,891 | 8,675,666 | |||||||||||
MYOS RENS TECHNOLOGY INC. AND SUBSIDIARY | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(Unaudited; in thousands) | |||||||
Nine Months Ended | |||||||
September 30, | |||||||
2020 | 2019 | ||||||
Cash Flows From Operating Activities: | |||||||
Net loss | $ | (2,452) | $ | (3,071) | |||
Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
Depreciation | 19 | 20 | |||||
Amortization | 157 | 262 | |||||
Stock-based compensation | 236 | 93 | |||||
Non-cash lease expense | 41 | - | |||||
Changes in operating assets and liabilities: | |||||||
(Increase) decrease in accounts receivable | (55) | 34 | |||||
Decrease in other current asset | - | 1,124 | |||||
Decrease in inventories | 298 | 51 | |||||
Increase in prepaid expenses and other assets | (71) | (88) | |||||
Decrease in operating lease liabilities | (35) | - | |||||
Decrease in other asset bond deposit | - | 50 | |||||
Increase in deferred revenue | - | 20 | |||||
Increase in accrued interest on promissory note payable | 27 | 29 | |||||
Decrease in accounts payable and accrued expenses | (376) | (428) | |||||
Net cash used in operating activities | (2,211) | (1,904) | |||||
Cash Flows From Financing Activities: | |||||||
Proceeds from registered direct offering of common stock, net | 1,298 | 438 | |||||
Proceeds from related party promissory note | 300 | - | |||||
Proceeds from note payable PPP loan | 310 | - | |||||
Deferred offering costs from at-the market transaction | - | (3) | |||||
Proceeds from issuance of common stock in private placement | 1,030 | 1,850 | |||||
Net cash provided by financing activities | 2,938 | 2,285 | |||||
Net increase in cash | 727 | 381 | |||||
Cash at beginning of period | 64 | 15 | |||||
Cash at end of period | $ | 791 | $ | 396 | |||
Supplemental schedule of non-cash investing and financing activities: | |||||||
Conversion of related party promissory note payable into shares of common stock | 825 | 250 | |||||
Reclassification of deferred offering costs to additional paid in capital | 95 | 16 | |||||
MYOS RENS TECHNOLOGY INC. AND SUBSIDIARY | ||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY | ||||||||||||||||||||
(in thousands, except share amounts) | ||||||||||||||||||||
Nine Months Ended September 30, 2020 | ||||||||||||||||||||
Common Stock | Additional | Accumulated | Total | |||||||||||||||||
Shares | Amount | capital | deficit | equity | ||||||||||||||||
Balance at December 31, 2019 | 9,176,908 | $ | 9 | $ | 40,496 | $ | (39,325) | $ | 1,180 | |||||||||||
Proceeds from sale of common stock, net | 964,102 | 1 | 1,202 | - | 1,203 | |||||||||||||||
Proceeds from private placement of common stock | 851,240 | 1 | 1,029 | - | 1,030 | |||||||||||||||
Issuance of common stock upon exchange of related party promissory note payable | 681,818 | 1 | 824 | - | 825 | |||||||||||||||
Stock-based compensation expense | - | - | 27 | - | 27 | |||||||||||||||
Issuance of restricted common stock | 172,727 | - | 209 | - | 209 | |||||||||||||||
Net loss | - | - | - | (2,452) | (2,452) | |||||||||||||||
Balance at September 30, 2020 | 11,846,795 | $ | 12 | $ | 43,787 | $ | (41,777) | $ | 2,022 | |||||||||||
Nine Months Ended September 30, 2019 | ||||||||||||||||||||
Common Stock | Additional | Accumulated | Total | |||||||||||||||||
Shares | Amount | capital | deficit | equity | ||||||||||||||||
Balance at December 31, 2018 | 7,481,723 | $ | 8 | $ | 37,880 | $ | (35,067) | $ | 2,821 | |||||||||||
Proceeds from sale of common stock | 111,129 | - | 211 | - | 211 | |||||||||||||||
Proceeds from private placement of common stock | 1,267,123 | 1 | 1,849 | - | 1,850 | |||||||||||||||
Issuance of common stock upon exchange of related party promissory note payable | 171,233 | - | 250 | - | 250 | |||||||||||||||
Stock-based compensation expense | - | - | 93 | - | 93 | |||||||||||||||
Issuance of restricted common stock | 145,700 | - | 211 | - | 211 | |||||||||||||||
Net loss | - | - | - | (3,071) | (3,071) | |||||||||||||||
Balance at September 30, 2019 | 9,176,908 | $ | 9 | $ | 40,494 | $ | (38,138) | $ | 2,365 | |||||||||||
Three Months Ended September 30, 2020 | ||||||||||||||||||||
Common Stock | Additional | Accumulated | Total | |||||||||||||||||
Shares | Amount | capital | deficit | equity | ||||||||||||||||
Balance at June 30, 2020 | 11,846,795 | $ | 12 | $ | 43,778 | $ | (40,962) | $ | 2,828 | |||||||||||
Stock-based compensation expense | - | - | 9 | 9 | ||||||||||||||||
Net loss | - | (815) | (815) | |||||||||||||||||
Balance at September 30, 2020 | 11,846,795 | $ | 12 | $ | 43,787 | $ | (41,777) | $ | 2,022 | |||||||||||
Three Months Ended September 30, 2019 | ||||||||||||||||||||
Common Stock | Additional | Accumulated | Total | |||||||||||||||||
Shares | Amount | capital | deficit | equity | ||||||||||||||||
Balance at June 30, 2019 | 9,170,658 | $ | 9 | $ | 40,462 | $ | (37,217) | $ | 3,254 | |||||||||||
Stock-based compensation expense | - | - | 22 | - | 22 | |||||||||||||||
Issuance of restricted common stock | 6,250 | - | 10 | - | 10 | |||||||||||||||
About MYOS RENS Technology Inc.
MYOS RENS Technology Inc. (MYOS), "The Muscle Company®", is a Cedar Knolls, NJ-based advanced nutrition company that develops and markets products that improve muscle health and performance. MYOS is the owner of Fortetropin®, a fertilized egg yolk-based product manufactured via a proprietary process to retain and optimize its biological activity. Fortetropin has been clinically shown to increase muscle size, lean body mass and reduce muscle atrophy. MYOS believes Fortetropin has the potential to redefine existing standards of physical health and wellness and produces muscle health support products featuring Fortetropin under the names of Yolked®, Physician Muscle Health Formula®, MYOS Canine Muscle Formula®, (Regular & Vet Strength) and Qurr®. For more information, please visit www.myosrens.com.
Forward-Looking Statements
Any statements in this release that are not historical facts are forward-looking statements. Actual results may differ materially from those projected or implied in any forward-looking statements. Such statements involve risks and uncertainties, including but not limited to those relating to product and customer demand, market acceptance of our products, the ability to create new products through research and development, the successful results of strategic initiatives, the success of our products, including Yolked®, Physician Muscle Health Formula®, MYOS Canine Muscle Formula®, Qurr®, and MYOS Enteral Nutrition Formula™, the success of our research and development, the results of the clinical evaluation of Fortetropin® and its effects, the ability to enter into new partnership opportunities and the success of our existing partnerships, the ability to generate revenue and cash flow from sales of our products, the ability to increase our revenue and gross profit margins, the ability to achieve a sustainable, profitable business, the effect of adverse economic conditions, including as a result of the COVID-19 pandemic, the ability to consummate the Merger Agreement with MedAvail, Inc., the ability to protect our intellectual property rights, competition from other providers and products, the continued listing of our securities on the Nasdaq Stock Market, risks in product development, our ability to raise capital to fund continuing operations, and other factors discussed from time to time in our filings with the Securities and Exchange Commission. We undertake no obligation to update or revise any forward-looking statement for events or circumstances after the date on which such statement is made except as required by law.
These statements have not been evaluated by the Food and Drug Administration. Our products are not intended to diagnose, treat, cure or prevent any disease.
Investor Relations:
MYOS RENS Technology
Joanne Goodford
Phone: 973-509-0444
Email: jgoodford@myoscorp.com
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