BeautyHealth Reports Second Quarter 2023 Financial Results
- Net sales for the second quarter ended June 30, 2023, were $117.5 million, reflecting a 13% year-over-year increase, with net income of $3.4 million and an adjusted EBITDA margin of 15.1%.
- Consumables net sales growth was +34% year-over-year, while delivery system net sales growth was +1% year-over-year, or +30% excluding trade-ups.
- Net sales in the APAC region grew +143% year-over-year, and in the Americas region, the change in net sales was (16)%, or +18% when excluding trade-ups.
- Gross margin decreased from 67.6% in Q2 2022 to 57.8% in Q2 2023, and adjusted gross margin decreased from 71.0% to 64.8% over the same period.
- Net income decreased from $6.3 million in Q2 2022 to $3.4 million in Q2 2023.
- Adjusted EBITDA margin decreased from 14.1% in Q2 2022 to 15.1% in Q2 2023.
Delivers double-digit net sales growth on demand for Hydrafacial
Confirms 2023 net sales and 2025 financial guidance, refines 2023 adjusted EBITDA margin guidance
“In the second quarter, we recommitted to our core and, in doing so, delivered consistent double-digit top-line performance and profitability in line with expectations,” said BeautyHealth President and CEO Andrew Stanleick. “At the same time, we are readying the organization for the next phase of growth, with a fortified executive team, robust innovation pipeline and disciplined approach to harnessing the enormous global market opportunity in front of us.”
Consumables net sales growth was +
Delivery system net sales growth for the quarter was +
Of note, the mix of delivery systems sold shifted towards lower-margin refurbished devices amidst a tightening credit environment and as
Net sales in the APAC region grew +
- Strategic and Pipeline Highlights
-
Partnered with LaserAway, one of the largest aesthetic chains in the
U.S. , to supply Hydrafacial Syndeo devices to its more than 125 locations and any new practice sites to be opened through 2025. -
Continued expansion of Hydrafacial's Sephora presence now to three continents with new doors in
Australia andMalaysia anticipated in the second half of the year. - Received FDA clearance for a new facial acne scarring indication for SkinStylus, making it the only microneedling device FDA-cleared for treatment on both the face and abdomen.
- Collaborating with Amazon Web Services, Inc. (AWS) Generative AI Innovation Center to expand the functionalities of the BeautyHealth data platform and to design new generative AI products and processes.
- Unveiled a custom Dior by Hydrafacial Syndeo delivery system at Dior Spa Cruise 2023 for exclusive use at select Dior spas worldwide.
-
Launched a re-imagined GLOWvolution campaign in
New York andLos Angeles , generating more than 1,200% growth in earned media value compared to last year's program.
Key Operational and Business Metrics
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||
Unaudited ($ in 000's) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
New systems sold |
|
2,389 |
|
|
1,535 |
|
|
4,025 |
|
|
3,104 |
Trade-up systems sold |
|
433 |
|
|
1,203 |
|
|
571 |
|
|
1,461 |
Total systems sold |
|
2,822 |
|
|
2,738 |
|
|
4,596 |
|
|
4,565 |
|
|
|
|
|
|
|
|
||||
Delivery system average selling price |
$ |
22.9 |
|
$ |
23.5 |
|
$ |
23.8 |
|
$ |
22.7 |
Active install base |
|
29,682 |
|
|
22,929 |
|
|
29,682 |
|
|
22,929 |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
Unaudited ($ in millions) (3) |
|
2023 |
|
|
|
2022(1) |
|
|
|
2023 |
|
|
|
2022(1) |
|
Delivery Systems net sales |
$ |
65.6 |
|
|
$ |
64.8 |
|
|
$ |
110.9 |
|
|
$ |
106.4 |
|
Consumables net sales |
|
51.9 |
|
|
|
38.8 |
|
|
|
92.8 |
|
|
|
72.5 |
|
Total net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
|
|
|
|
|
|
|
|
||||||||
Gross profit |
$ |
67.9 |
|
|
$ |
70.0 |
|
|
$ |
122.0 |
|
|
$ |
120.9 |
|
Gross margin |
|
57.8 |
% |
|
|
67.6 |
% |
|
|
59.9 |
% |
|
|
67.6 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted gross profit(2) |
$ |
76.2 |
|
|
$ |
73.5 |
|
|
$ |
136.5 |
|
|
$ |
127.6 |
|
Adjusted gross margin(2) |
|
64.8 |
% |
|
|
71.0 |
% |
|
|
67.0 |
% |
|
|
71.3 |
% |
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
3.4 |
|
|
$ |
6.3 |
|
|
$ |
(16.9 |
) |
|
$ |
37.8 |
|
Adjusted EBITDA(2) |
$ |
17.8 |
|
|
$ |
14.6 |
|
|
$ |
17.3 |
|
|
$ |
18.3 |
|
Adjusted EBITDA margin(2) |
|
15.1 |
% |
|
|
14.1 |
% |
|
|
8.5 |
% |
|
|
10.2 |
% |
___________________
(1) |
Reflects the impact of immaterial revisions to the financial statements. |
|
(2) |
See "Non-GAAP Financial Measures" below. |
|
(3) |
Amounts may not sum due to rounding. |
Financial Highlights
-
Net sales were
$117.5 million 13% compared to the prior year period, driven by strong demand for Hydrafacial from providers and by strength in consumables. -
Gross margin was
57.8% in Q2 2023 compared to67.6% in Q2 2022. Adjusted gross margin was64.8% in Q2 2023 compared to71.0% in Q2 2022. Gross margin was impacted by an increase in sales of lower margin refurbished systems, particularly in theU.S. , and the sell-through of higher cost inventory. -
Net income was
$3.4 million $6.3 million -
Adjusted EBITDA was
$17.8 million $14.6 million
Net Sales by Region
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||
Unaudited ($ in millions) (1) |
|
2023 |
|
|
2022 |
|
|
2023 |
|
|
2022 |
|
$ |
63.6 |
|
$ |
75.4 |
|
$ |
116.6 |
|
$ |
120.0 |
|
|
25.2 |
|
|
10.4 |
|
|
38.9 |
|
|
23.3 |
|
|
28.6 |
|
|
17.8 |
|
|
48.3 |
|
|
35.7 |
Total net sales |
$ |
117.5 |
|
$ |
103.5 |
|
$ |
203.8 |
|
$ |
179.0 |
___________________
(1) |
Amounts may not sum due to rounding. |
-
Net sales in the
Americas region decreased (16)% to$63.6 million Americas total net sales grew by +18% . -
Net sales in the APAC region increased +
143% to$25.2 million China's recovery. When excluding the impact of trade-ups, APAC total net sales grew by +92% . -
Net sales in the EMEA region increased +
61% to$28.6 million 37% .
Operating Expenses
-
Selling and marketing expenses were
$43.0 million $44.9 million -
General and administrative expenses were
$35.1 million $27.6 million
Balance Sheet and Cash Flow Highlights
-
Cash and cash equivalents were approximately
$549.7 million $568.2 million -
The Company had approximately 7.0 million private placement warrants and approximately 132.9 million shares of Class A common stock outstanding as of June 30, 2023. In April 2023, the Company completed its second
$100.0 million $100.0 million $10.78
Financial Guidance
|
Current as of August 2023 |
Previous |
Fiscal Year 2023 |
|
|
Net sales |
|
|
Adjusted gross margin(1) |
— |
> Fiscal 2022 |
Adjusted EBITDA margin(1) |
|
|
|
|
|
Fiscal Year 2025 |
|
|
Net sales |
|
|
Adjusted EBITDA margin(1) |
|
|
___________________
(1) |
See "Non-GAAP Financial Measures" below. |
-
The Company re-affirmed its fiscal year 2023 net sales due to continued demand for Hydrafacial, strong trends in
China and ability to drive operating leverage, and refined its fiscal year 2023 adjusted EBITDA guidance to a range of 18-19% from 18-20% previously. - The Company retracted its 2023 fiscal year 2023 adjusted gross margin guidance due to Q2 margin headwinds carrying into the back half of 2023.
- The Company re-affirmed its fiscal year 2025 long-range outlook, due to continued strong business fundamentals, fortified leadership team and its expected pipeline of innovation.
Financial guidance reflects the following external environment assumptions:
- Assumes no material deterioration in general market conditions or other unforeseen circumstances beyond the Company's control.
- Excludes any unannounced acquisitions, dispositions or financings during 2023.
- Assumes a largely re-opened global market, which would be negatively impacted if closures related to COVID-19 or other restrictive measures are reimplemented.
- Assumes no material deterioration in foreign currency exchange rates.
Conference Call
BeautyHealth will host a conference call on Wednesday, August 9, 2023, at 8:30 a.m. ET to review its second quarter 2023 financial results. The call may be accessed via live webcast through the Events & Presentations page on our Investor Relations website at https://investors.beautyhealth.com. A replay of the conference call will be available approximately three hours after the conclusion of the call and can be accessed online at https://investors.beautyhealth.com.
Non-GAAP Financial Measures
In addition to results determined in accordance with accounting principles generally accepted in
Management believes that these non-GAAP financial measures, when reviewed collectively with the Company’s GAAP financial information, provide useful supplemental information to investors in assessing the Company's operating performance. These non-GAAP financial measures should not be considered as an alternative to GAAP financial information or as an indication of operating performance or any other measure of performance derived in accordance with GAAP, and may not provide information that is directly comparable to that provided by other companies in its industry, as these other companies may calculate non-GAAP financial measures differently, particularly related to unusual items.
Net sales excluding trade-ups is calculated as net sales excluding the effect of net sales associated with delivery systems sold under a trade-up program.
Adjusted gross profit is gross profit excluding the effects of depreciation expense, amortization expense, stock-based compensation expense and other items such as write-off of discontinued and obsolete product, Syndeo product optimization logistics & service costs and accrual for annual cash incentives.
Adjusted selling and marketing expense is calculated as selling and marketing expense excluding the effects of depreciation expense, amortization expense, stock-based compensation expense and other items such as the accrual for annual cash incentives and severance, restructuring and other. Adjusted research and development expense is calculated as research and development expense excluding the effects of stock-based compensation expense and other items such as the accrual for annual cash incentives and severance, restructuring and other. Adjusted general and administrative expense is calculated as general and administrative expense excluding the effects of depreciation expense, amortization expense, stock-based compensation expense, loss on disposal of assets, transaction related costs, litigation related costs, accrual for annual cash incentives and severance, restructuring and other.
Adjusted EBITDA is calculated as net income (loss) excluding the effects of (benefit) expense for income taxes, depreciation expense, amortization expense, stock-based compensation expense, interest expense, interest income, other (income) expense, change in fair value of warrant liability, foreign currency (gain) loss, net, loss on disposal of assets, transaction related costs, write-off of discontinued and obsolete product, litigation related costs, Syndeo product optimization logistics & service costs, accrual for annual cash incentives and severance, restructuring and other.
The Company does not provide a reconciliation of its fiscal 2023 adjusted EBITDA margin guidance to net income (loss), the most directly comparable forward looking GAAP financial measures, due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation, which cannot be done without unreasonable efforts, including adjustments that could be made for changes in fair value of warrant liabilities, integration and acquisition-related expenses, amortization expenses, non-cash stock-based compensation, gains/losses on foreign currency, and other charges reflected in our reconciliation of historic numbers, the amount of which, based on historical experience, could be significant. The presentation of this 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. The Company's fiscal 2023 adjusted gross margin and adjusted EBITDA margin guidance is merely an outlook and is not a guarantee of future performance. Stockholders should not rely or place an undue reliance on such forward-looking statements. See “Forward-Looking Statements” for additional information.
The Beauty Health Company Condensed Consolidated Statements of Comprehensive Income (Loss) (1) ($ in millions, except share and per share amounts) (Unaudited) |
|||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2023 |
|
|
|
2022(2) |
|
|
|
2023 |
|
|
|
2022(2) |
|
Net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
Cost of sales |
|
49.6 |
|
|
|
33.5 |
|
|
|
81.8 |
|
|
|
58.0 |
|
Gross profit |
|
67.9 |
|
|
|
70.0 |
|
|
|
122.0 |
|
|
|
120.9 |
|
Operating expenses: |
|
|
|
|
|
|
|
||||||||
Selling and marketing |
|
43.0 |
|
|
|
44.9 |
|
|
|
81.7 |
|
|
|
81.3 |
|
Research and development |
|
2.9 |
|
|
|
2.6 |
|
|
|
5.2 |
|
|
|
4.8 |
|
General and administrative |
|
35.1 |
|
|
|
27.6 |
|
|
|
65.5 |
|
|
|
53.8 |
|
Total operating expenses |
|
81.0 |
|
|
|
75.1 |
|
|
|
152.4 |
|
|
|
140.0 |
|
Loss from operations |
|
(13.1 |
) |
|
|
(5.0 |
) |
|
|
(30.5 |
) |
|
|
(19.0 |
) |
Interest expense, net |
|
3.4 |
|
|
|
3.2 |
|
|
|
6.8 |
|
|
|
6.6 |
|
Interest income |
|
(5.7 |
) |
|
|
(0.7 |
) |
|
|
(10.0 |
) |
|
|
(0.7 |
) |
Other (income) expense, net |
|
— |
|
|
|
(0.9 |
) |
|
|
(0.5 |
) |
|
|
— |
|
Change in fair value of warrant liabilities |
|
(11.6 |
) |
|
|
(15.2 |
) |
|
|
(2.5 |
) |
|
|
(67.2 |
) |
Foreign currency transaction (gain) loss, net |
|
(0.4 |
) |
|
|
2.2 |
|
|
|
(1.5 |
) |
|
|
1.8 |
|
Income (loss) before provision for income taxes |
|
1.2 |
|
|
|
6.4 |
|
|
|
(22.8 |
) |
|
|
40.5 |
|
Income tax (benefit) expense |
|
(2.2 |
) |
|
|
0.1 |
|
|
|
(5.9 |
) |
|
|
2.7 |
|
Net income (loss) |
|
3.4 |
|
|
|
6.3 |
|
|
|
(16.9 |
) |
|
|
37.8 |
|
Comprehensive income (loss), net of tax: |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments |
|
(0.4 |
) |
|
|
(3.7 |
) |
|
|
0.5 |
|
|
|
(3.8 |
) |
Comprehensive income (loss) |
$ |
3.0 |
|
|
$ |
2.6 |
|
|
$ |
(16.4 |
) |
|
$ |
33.9 |
|
Net income (loss) per share |
|
|
|
|
|
|
|
||||||||
Basic |
$ |
0.03 |
|
|
$ |
0.04 |
|
|
$ |
(0.13 |
) |
|
$ |
0.25 |
|
Diluted |
$ |
0.03 |
|
|
$ |
(0.06 |
) |
|
$ |
(0.13 |
) |
|
$ |
(0.19 |
) |
Weighted average common shares outstanding |
|
|
|
|
|
|
|
||||||||
Basic |
|
132,716,024 |
|
|
|
150,731,491 |
|
|
|
132,569,209 |
|
|
|
150,665,166 |
|
Diluted |
|
132,716,024 |
|
|
|
151,719,451 |
|
|
|
132,569,209 |
|
|
|
152,274,394 |
|
___________________
(1) |
Amounts may not sum due to rounding. |
|
(2) |
Reflects the impact of immaterial revisions to the financial statements. |
The Beauty Health Company Condensed Consolidated Balance Sheets (1) ($ in millions) (Unaudited) |
|||||||
|
June 30, 2023 |
|
December 31, 2022 (2) |
||||
ASSETS |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
549.7 |
|
|
$ |
568.2 |
|
Accounts receivable, net |
|
74.6 |
|
|
|
76.5 |
|
Inventories |
|
107.0 |
|
|
|
109.7 |
|
Income tax receivable |
|
5.6 |
|
|
|
1.3 |
|
Prepaid expenses and other current assets |
|
30.9 |
|
|
|
27.6 |
|
Total current assets |
|
767.9 |
|
|
|
783.3 |
|
Property and equipment, net |
|
18.0 |
|
|
|
18.2 |
|
Right-of-use assets, net |
|
13.8 |
|
|
|
15.6 |
|
Intangible assets, net |
|
65.6 |
|
|
|
46.4 |
|
Goodwill |
|
125.4 |
|
|
|
124.6 |
|
Deferred income tax assets, net |
|
0.8 |
|
|
|
0.8 |
|
Other assets |
|
16.1 |
|
|
|
14.2 |
|
TOTAL ASSETS |
$ |
1,007.5 |
|
|
$ |
1,003.1 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
29.4 |
|
|
$ |
28.5 |
|
Accrued payroll-related expenses |
|
26.2 |
|
|
|
21.7 |
|
Other accrued expenses |
|
19.1 |
|
|
|
15.2 |
|
Lease liabilities, current |
|
4.9 |
|
|
|
5.0 |
|
Income tax payable |
|
3.2 |
|
|
|
1.4 |
|
Total current liabilities |
|
82.8 |
|
|
|
71.7 |
|
Lease liabilities, non-current |
|
10.6 |
|
|
|
12.7 |
|
Deferred income tax liabilities, net |
|
2.0 |
|
|
|
2.0 |
|
Warrant liabilities |
|
13.0 |
|
|
|
15.5 |
|
Convertible senior notes, net |
|
736.3 |
|
|
|
734.1 |
|
Other long-term liabilities |
|
1.0 |
|
|
|
— |
|
TOTAL LIABILITIES |
$ |
845.6 |
|
|
$ |
836.0 |
|
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
||||
Class A Common Stock |
$ |
— |
|
|
$ |
— |
|
Additional paid-in capital |
|
561.5 |
|
|
|
550.3 |
|
Accumulated other comprehensive loss |
|
(4.0 |
) |
|
|
(4.5 |
) |
Accumulated deficit |
|
(395.6 |
) |
|
|
(378.8 |
) |
Total stockholders’ equity |
$ |
161.8 |
|
|
$ |
167.1 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
1,007.5 |
|
|
$ |
1,003.1 |
|
___________________
(1) |
Amounts may not sum due to rounding. |
|
(2) |
Reflects the impact of immaterial revisions to the financial statements. |
The Beauty Health Company Condensed Consolidated Statement of Cash Flows (1) ($ in millions) (Unaudited) |
|||||||
|
Six Months Ended June 30, |
||||||
|
|
2023 |
|
|
|
2022 (2) |
|
Cash and cash equivalents at beginning of period |
$ |
568.2 |
|
|
$ |
901.9 |
|
Operating activities: |
|
|
|
||||
Net (loss) income |
|
(16.9 |
) |
|
|
37.8 |
|
Non-cash adjustments |
|
36.0 |
|
|
|
(33.2 |
) |
Change in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
(0.1 |
) |
|
|
(34.4 |
) |
Inventories |
|
(2.6 |
) |
|
|
(38.6 |
) |
Prepaid expenses, other current assets, and income tax receivable |
|
(12.2 |
) |
|
|
(5.2 |
) |
Accounts payable, accrued expenses, and income tax payable |
|
9.2 |
|
|
|
8.4 |
|
Other, net |
|
(4.4 |
) |
|
|
(4.6 |
) |
Net cash provided by (used for) operating activities |
|
9.0 |
|
|
|
(69.8 |
) |
Net cash used for investing activities |
|
(24.9 |
) |
|
|
(8.3 |
) |
Net cash used for financing activities |
|
(3.7 |
) |
|
|
(2.8 |
) |
Net decrease in cash and cash equivalents |
|
(19.7 |
) |
|
|
(80.9 |
) |
Effect of foreign currency translation |
|
1.2 |
|
|
|
— |
|
Cash and cash equivalents at end of period |
$ |
549.7 |
|
|
$ |
821.0 |
|
___________________
(1) |
Amounts may not sum due to rounding. |
|
(2) |
Reflects the impact of immaterial revisions to the financial statements. |
The following table reconciles gross profit to adjusted gross profit for the periods presented: |
|||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
Unaudited ($ in millions) (2) |
|
2023 |
|
|
|
2022(1) |
|
|
|
2023 |
|
|
|
2022(1) |
|
Net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
|
|
|
|
|
|
|
|
||||||||
Gross profit |
$ |
67.9 |
|
|
$ |
70.0 |
|
|
$ |
122.0 |
|
|
$ |
120.9 |
|
Gross margin |
|
57.8 |
% |
|
|
67.6 |
% |
|
|
59.9 |
% |
|
|
67.6 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted to exclude the following: |
|
|
|
|
|
|
|
||||||||
Depreciation expense |
|
0.6 |
|
|
|
0.6 |
|
|
|
1.1 |
|
|
|
1.0 |
|
Amortization expense |
|
4.5 |
|
|
|
2.4 |
|
|
|
6.9 |
|
|
|
4.6 |
|
Stock-based compensation expense |
|
0.4 |
|
|
|
0.2 |
|
|
|
0.7 |
|
|
|
0.4 |
|
Write-off of discontinued and obsolete product |
|
1.0 |
|
|
|
— |
|
|
|
4.0 |
|
|
|
— |
|
Syndeo product optimization logistics & service costs |
|
1.4 |
|
|
|
— |
|
|
|
1.4 |
|
|
|
— |
|
Accrual for annual cash incentives(3) |
|
0.4 |
|
|
|
0.3 |
|
|
|
0.4 |
|
|
|
0.6 |
|
Adjusted gross profit |
$ |
76.2 |
|
|
$ |
73.5 |
|
|
$ |
136.5 |
|
|
$ |
127.6 |
|
Adjusted gross margin |
|
64.8 |
% |
|
|
71.0 |
% |
|
|
67.0 |
% |
|
|
71.3 |
% |
___________________
(1) |
Reflects the impact of immaterial revisions to the financial statements. |
|
(2) |
Amounts may not sum due to rounding. |
|
(3) |
Amount in the prior periods adjusted to exclude its impact for comparability purposes. |
The following table reconciles selling and marketing expense to adjusted selling and marketing expense for the periods presented: |
|||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
Unaudited ($ in millions) (2) |
|
2023 |
|
|
|
2022(1) |
|
|
|
2023 |
|
|
|
2022(1) |
|
Net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
|
|
|
|
|
|
|
|
||||||||
Selling and marketing expense |
$ |
43.0 |
|
|
$ |
44.9 |
|
|
$ |
81.7 |
|
|
$ |
81.3 |
|
% net sales |
|
36.6 |
% |
|
|
43.3 |
% |
|
|
40.1 |
% |
|
|
45.4 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted to exclude the following: |
|
|
|
|
|
|
|
||||||||
Depreciation expense |
|
1.1 |
|
|
|
0.2 |
|
|
|
1.4 |
|
|
|
0.7 |
|
Amortization expense |
|
1.0 |
|
|
|
0.6 |
|
|
|
1.6 |
|
|
|
1.3 |
|
Stock-based compensation expense |
|
1.7 |
|
|
|
2.0 |
|
|
|
3.5 |
|
|
|
4.8 |
|
Accrual for annual cash incentives(3) |
|
1.8 |
|
|
|
1.1 |
|
|
|
1.8 |
|
|
|
1.4 |
|
Severance, restructuring and other |
|
1.5 |
|
|
|
0.8 |
|
|
|
1.7 |
|
|
|
0.8 |
|
Adjusted selling and marketing expense |
$ |
36.0 |
|
|
$ |
40.1 |
|
|
$ |
71.8 |
|
|
$ |
72.2 |
|
Adjusted % net sales |
|
30.6 |
% |
|
|
38.8 |
% |
|
|
35.2 |
% |
|
|
40.4 |
% |
___________________
(1) |
Reflects the impact of immaterial revisions to the financial statements. |
|
(2) |
Amounts may not sum due to rounding. |
|
(3) |
Amount in the prior periods adjusted to exclude its impact for comparability purposes. |
The following table reconciles research and development expense to adjusted research and development expense for the periods presented: |
|||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
Unaudited ($ in millions) (2) |
|
2023 |
|
|
|
2022(1) |
|
|
|
2023 |
|
|
|
2022(1) |
|
Net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
|
|
|
|
|
|
|
|
||||||||
Research and development expense |
$ |
2.9 |
|
|
$ |
2.6 |
|
|
$ |
5.2 |
|
|
$ |
4.8 |
|
% net sales |
|
2.5 |
% |
|
|
2.5 |
% |
|
|
2.6 |
% |
|
|
2.7 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted to exclude the following: |
|
|
|
|
|
|
|
||||||||
Stock-based compensation expense |
|
0.4 |
|
|
|
0.3 |
|
|
|
0.4 |
|
|
|
0.4 |
|
Accrual for annual cash incentives(3) |
|
0.4 |
|
|
|
0.8 |
|
|
|
0.4 |
|
|
|
0.6 |
|
Severance, restructuring and other |
|
0.1 |
|
|
|
— |
|
|
|
0.5 |
|
|
|
— |
|
Adjusted research and development expense |
$ |
2.0 |
|
|
$ |
1.6 |
|
|
$ |
4.0 |
|
|
$ |
3.8 |
|
Adjusted % net sales |
|
1.7 |
% |
|
|
1.5 |
% |
|
|
1.9 |
% |
|
|
2.1 |
% |
___________________
(1) |
Reflects the impact of immaterial revisions to the financial statements. |
|
(2) |
Amounts may not sum due to rounding. |
|
(3) |
Amount in the prior periods adjusted to exclude its impact for comparability purposes. |
The following table reconciles general and administrative expense to adjusted general and administrative expense for the period presented: |
|||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
Unaudited ($ in millions) (2) |
|
2023 |
|
|
|
2022(1) |
|
|
|
2023 |
|
|
|
2022(1) |
|
Net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
|
|
|
|
|
|
|
|
||||||||
General and administrative expense |
$ |
35.1 |
|
|
$ |
27.6 |
|
|
$ |
65.5 |
|
|
$ |
53.8 |
|
% net sales |
|
29.9 |
% |
|
|
26.6 |
% |
|
|
32.1 |
% |
|
|
30.1 |
% |
|
|
|
|
|
|
|
|
||||||||
Adjusted to exclude the following: |
|
|
|
|
|
|
|
||||||||
Depreciation expense |
|
0.9 |
|
|
|
1.1 |
|
|
|
1.9 |
|
|
|
1.5 |
|
Amortization expense |
|
2.3 |
|
|
|
0.9 |
|
|
|
3.7 |
|
|
|
1.8 |
|
Stock-based compensation expense |
|
6.1 |
|
|
|
3.9 |
|
|
|
7.6 |
|
|
|
7.8 |
|
Loss on disposal of assets |
|
— |
|
|
|
1.0 |
|
|
|
0.1 |
|
|
|
1.0 |
|
Transaction related costs |
|
0.8 |
|
|
|
2.0 |
|
|
|
0.8 |
|
|
|
3.0 |
|
Litigation related costs |
|
0.5 |
|
|
|
— |
|
|
|
1.5 |
|
|
|
— |
|
Accrual for annual cash incentives(3) |
|
2.8 |
|
|
|
1.5 |
|
|
|
2.8 |
|
|
|
3.4 |
|
Severance, restructuring and other |
|
1.3 |
|
|
|
0.1 |
|
|
|
3.5 |
|
|
|
2.1 |
|
Adjusted general and administrative expense |
$ |
20.4 |
|
|
$ |
17.1 |
|
|
$ |
43.6 |
|
|
$ |
33.3 |
|
Adjusted % net sales |
|
17.4 |
% |
|
|
16.6 |
% |
|
|
21.4 |
% |
|
|
18.6 |
% |
___________________
(1) |
Reflects the impact of immaterial revisions to the financial statements. |
|
(2) |
Amounts may not sum due to rounding. |
|
(3) |
Amount in the prior periods adjusted to exclude its impact for comparability purposes. |
The following table reconciles net income (loss) to adjusted EBITDA for the periods presented: |
|||||||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
Unaudited ($ in millions) (2) |
|
2023 |
|
|
|
2022(1) |
|
|
|
2023 |
|
|
|
2022(1) |
|
Net sales |
$ |
117.5 |
|
|
$ |
103.5 |
|
|
$ |
203.8 |
|
|
$ |
179.0 |
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) |
$ |
3.4 |
|
|
$ |
6.3 |
|
|
$ |
(16.9 |
) |
|
$ |
37.8 |
|
Adjusted to exclude the following: |
|
|
|
|
|
|
|
||||||||
(Benefit) expense for income taxes |
|
(2.2 |
) |
|
|
0.1 |
|
|
|
(5.9 |
) |
|
|
2.7 |
|
Depreciation expense |
|
2.6 |
|
|
|
1.9 |
|
|
|
4.5 |
|
|
|
3.3 |
|
Amortization expense |
|
7.8 |
|
|
|
3.9 |
|
|
|
12.2 |
|
|
|
7.7 |
|
Stock-based compensation expense |
|
8.5 |
|
|
|
6.4 |
|
|
|
12.1 |
|
|
|
13.4 |
|
Interest expense |
|
3.4 |
|
|
|
3.2 |
|
|
|
6.8 |
|
|
|
6.6 |
|
Interest income |
|
(5.7 |
) |
|
|
(0.7 |
) |
|
|
(10.0 |
) |
|
|
(0.7 |
) |
Other (income) expense, net |
|
— |
|
|
|
(0.9 |
) |
|
|
(0.5 |
) |
|
|
— |
|
Change in fair value of warrant liability |
|
(11.6 |
) |
|
|
(15.2 |
) |
|
|
(2.5 |
) |
|
|
(67.2 |
) |
Foreign currency (gain) loss, net |
|
(0.4 |
) |
|
|
2.2 |
|
|
|
(1.5 |
) |
|
|
1.8 |
|
Loss on disposal of assets |
|
— |
|
|
|
1.0 |
|
|
|
0.1 |
|
|
|
1.0 |
|
Transaction related costs |
|
0.8 |
|
|
|
2.0 |
|
|
|
0.8 |
|
|
|
3.0 |
|
Write-off of discontinued and obsolete product |
|
1.0 |
|
|
|
— |
|
|
|
4.0 |
|
|
|
— |
|
Litigation related costs |
|
0.5 |
|
|
|
— |
|
|
|
1.5 |
|
|
|
— |
|
Syndeo product optimization logistics & service costs |
|
1.4 |
|
|
|
— |
|
|
|
1.4 |
|
|
|
— |
|
Accrual for annual cash incentives(3) |
|
5.4 |
|
|
|
3.6 |
|
|
|
5.4 |
|
|
|
6.1 |
|
Severance, restructuring and other |
|
2.8 |
|
|
|
0.9 |
|
|
|
5.7 |
|
|
|
2.9 |
|
Adjusted EBITDA |
$ |
17.8 |
|
|
$ |
14.6 |
|
|
$ |
17.3 |
|
|
$ |
18.3 |
|
Adjusted EBITDA margin |
|
15.1 |
% |
|
|
14.1 |
% |
|
|
8.5 |
% |
|
|
10.2 |
% |
___________________
(1) |
Reflects the impact of immaterial revisions to the financial statements. |
|
(2) |
Amounts may not sum due to rounding. |
|
(3) |
Amount in the prior periods adjusted to exclude its impact for comparability purposes. |
About The Beauty Health Company
The Beauty Health Company (NASDAQ: SKIN) is a global category-creating company delivering millions of skin health experiences every year that help consumers reinvent their relationship with their skin, bodies and self-confidence. Our brands are pioneers: Hydrafacial™ in hydradermabrasion, SkinStylus™ in microneedling, and Keravive™ in scalp health. Together, with our powerful community of estheticians, partners and consumers, we are personalizing skin health for all ages, genders, skin tones, and skin types in more than 90 countries. We are committed to being ever more mindful in how we conduct our business to positively impact our communities and the planet. Find a local provider at https://hydrafacial.com/find-a-provider/, and learn more at beautyhealth.com or LinkedIn.
Forward-Looking Statements
Certain statements made in this release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, including statements regarding The Beauty Health Company’s strategy, plans, objectives, initiatives and financial outlook. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements.
These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside The Beauty Health Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. As such, readers are cautioned not to place undue reliance on any forward-looking statements.
Important factors that may affect actual results or outcomes include, among others: The Beauty Health Company’s ability to manage growth; The Beauty Health Company’s ability to execute its business plan; potential litigation involving The Beauty Health Company; changes in applicable laws or regulations; the possibility that The Beauty Health Company may be adversely affected by other economic, business, and/or competitive factors; the impact of the continuing COVID-19 pandemic on the Company’s business; and other risks and uncertainties set forth in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 filed with the
View source version on businesswire.com: https://www.businesswire.com/news/home/20230809785640/en/
The One Nine Three Group
Investors: BeautyHealthIR@the193.com
Press: BeautyHealth@the193.com
Source: The Beauty Health Company
FAQ
What were The Beauty Health Company's net sales for the second quarter of 2023?
What was the adjusted EBITDA margin for the second quarter of 2023?
How did the net sales in the APAC region change in the second quarter of 2023?
What caused the decrease in gross margin from Q2 2022 to Q2 2023?
What was the change in net sales in the Americas region in the second quarter of 2023?
