Tivic Reports Second Quarter 2023 Financial Results
- Gross profit increased to 37.5%
- Operating expenses reduced to $2.2 million
- Signed distribution agreement with Cardinal Health
- Sold shares of common stock for $5.2 million
- Q2 revenue decreased by 70% to $161 thousand
- Net loss decreased to $2.1 million
- Marketing expense reductions led to 82% decline in unit sales
Second Quarter 2023 Financial Summary
-
Gross profit of
37.5% in the second quarter of 2023, compared to23.4% in the second quarter of 2022, on total revenue of$60 thousand $123 thousand -
Net loss of
$2.1 million $3.0 million -
Cash and cash equivalents totaled
$2.7 million
Second Quarter 2023 Business Highlights
-
Significant cost structure changes resulting in lower operating expenses of
$2.2 million $3.1 million - Broadened our intellectual property portfolio to include new therapeutic targets via vagus nerve stimulation.
- Collaborated with The Feinstein Institute for Medical Research on a pilot study of Tivic’s internally tested non-invasive targeting of vagus nerve activity. Successful completion of this study has the potential to open new product opportunities in neurology, cardiology, and rheumatology.
- Signed a distribution agreement with Cardinal Health. This agreement is a key step in expanding distribution and marketing targeted at healthcare professionals. Cardinal Health is a leading distributor and manufacturer of medical products and services for healthcare facilities worldwide.
- Launched B2B (business-to-business) sales portal in April 2023.
- Implemented pricing increases on ClearUP in April 2023, aligned with rigorous price testing completed in the first quarter of 2023.
Recent Developments
-
From July 11, 2023, to August 9, 2023, we sold shares of common stock in a series of public offerings, resulting in aggregate gross proceeds of approximately
$5.2 million $4.8 million - On August 11, 2023, Tivic shareholders voted in favor of a reverse stock split in order to regain compliance with the Nasdaq minimum bid price requirement and maintain our Nasdaq listing.
Management Commentary
“This quarter was, in many ways, a reset for the company. Q2 included the tough decisions necessary to move the company forward. As I discussed in a Letter to Shareholders a few weeks ago, we faced compliance issues with our Nasdaq listing, which we believe are now on the verge of being resolved following a positive shareholder vote. In addition, we brought
“Internally we downsized the team, reduced operating overhead, and narrowed our focus to critical strategic areas. We are working with a strong marketing leader, Elizabeth Jackson, and an interim CFO, Kim Bambach -- both of whom have successfully developed and executed transformational business strategies to drive growth and enhance operating performance.
“Several of those decisions had a significant short-term impact on revenue this quarter. The pricing increase, while making product sales more profitable, negatively impacted near-term sales. Additionally, we held back on marketing spend where it was unproductive as we retooled the marketing strategy. We began to refine the market to address segments having the highest likelihood of purchase and willingness to pay, as well as develop the tools needed to address new healthcare-oriented sales channels, such as the recently announced Cardinal Health agreement.
“We were to begin the active phase of our collaboration at Feinstein Institutes for Medical Research on a pilot study using a new neurostimulation approach, one expected to enable a more precise targeting of vagus nerve activity for the treatment of neurologic, cardiac and auto-immune responses.”
Ernst concluded, “This quarter was all about ensuring cost-cutting measures were implemented, processes were streamlined, and market and sales targets were realigned. These decisions, while difficult on a quarterly basis, are essential to strengthening company performance and we expect to see growth and improved performance in the second half of 2023.”
Second Quarter 2022 Financial Review
Net revenue for the second quarter of 2023 was
The cost of sales for the second quarter of 2023 was
Gross profit for the second quarter of 2023 was
Sales and marketing expenses were
Research and development expenses were
General and administrative expenses were
As of June 30, 2023, the company had
The company’s MD&A and consolidated financial statements for the second quarter ended June 30, 2023, will be filed on August 14, 2023, with the company’s Quarterly Report on Form 10-Q. The company's previous public filings may be found on www.sec.gov and can also be located on Tivic’s website at: https://tivichealth.com/investor/#SEC.
Conference Call and Webcast Information
Management will host a conference call on Monday, August 14th, 2023 at 1:30 pm PT / 4:30 pm ET to discuss the company’s second-quarter 2023 financial results and provide a business update.
The conference call will be available via telephone by dialing toll-free 877-545-0523 for local callers; or 973-528-0016 for international callers and using entry code 679005.
The conference call will also be available via the Webcast link: https://www.webcaster4.com/Webcast/Page/2865/48652
An audio replay of the call will be available from the “Investor” page on the Tivic Health website at https://tivichealth.com/investor/.
About Tivic
Tivic is a commercial health tech company advancing the field of bioelectronic medicine. Tivic’s patented technology platform leverages stimulation on the trigeminal, sympathetic, and vagus nerve structures. Tivic’s non-invasive and targeted approach to the treatment of inflammatory chronic health conditions gives consumers and providers drug-free therapeutic solutions with high safety profiles, low risk, and broad applications. Tivic’s first commercial product, ClearUP, is an FDA approved, award-winning, handheld bioelectronic sinus device. ClearUP is clinically proven, doctor-recommended, and is available through online retailers and commercial distributors. For more information, visit http://tivichealth.com @TivicHealth
Forward-Looking Statements
This press release may contain “forward-looking statements” that are subject to substantial risks and uncertainties. All statements, other than statements of historical fact, contained in this press release are forward-looking statements. Forward-looking statements contained in this press release may be identified by the use of words such as “anticipate,” “believe,” “contemplate,” “could,” “estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “target,” “aim,” “should,” “will” “would,” or the negative of these words or other similar expressions, although not all forward-looking statements contain these words. Forward-looking statements are based on Tivic Health Systems, Inc.’s current expectations and are subject to inherent uncertainties, risks, and assumptions that are difficult to predict. Further, certain forward-looking statements are based on assumptions as to future events that may not prove to be accurate. Actual results could differ materially from those contained in any forward-looking statement as a result of various factors, including, without limitation: market, economic and other conditions; the continued listing of the company’s common stock on the Nasdaq Capital Market; supply chain constraints; macroeconomic factors, including inflation; the company's financial condition; the company’s ability to raise additional capital on favorable terms if and when necessary; changes in regulatory requirements; and unexpected costs, charges or expenses that reduce Tivic’s capital resources. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. For a discussion of other risks and uncertainties, and other important factors, any of which could cause Tivic’s actual results to differ from those contained in the forward-looking statements, see Tivic’s filings with the SEC, including, its Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 31, 2023, under the heading “Risk Factors,” as well as the company’s subsequent filings with the SEC. Forward-looking statements contained in this press release are made as of this date, and Tivic Health Systems, Inc. undertakes no duty to update such information except as required by applicable law.
Tivic Health Systems, Inc. Condensed Balance Sheets (in thousands, except share and per share data) |
||||||||
|
|
June 30, 2023 |
|
December 31, 2022 |
||||
|
|
(Unaudited) |
|
(Audited) |
||||
ASSETS |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
2,659 |
|
|
$ |
3,517 |
|
Other current assets |
|
|
1,341 |
|
|
|
1,770 |
|
TOTAL CURRENT ASSETS |
|
|
4,000 |
|
|
|
5,287 |
|
PROPERTY AND EQUIPMENT, NET |
|
|
124 |
|
|
|
12 |
|
NONCURRENT ASSETS |
|
|
472 |
|
|
|
557 |
|
TOTAL ASSETS |
|
$ |
4,596 |
|
|
$ |
5,856 |
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||||
Accounts payable and accrued expenses |
|
$ |
975 |
|
|
$ |
1,696 |
|
Other current liabilities |
|
|
185 |
|
|
|
163 |
|
TOTAL CURRENT LIABILITIES |
|
|
1,160 |
|
|
|
1,859 |
|
TOTAL LONG-TERM LIABILITIES |
|
|
275 |
|
|
|
367 |
|
STOCKHOLDERS' EQUITY |
|
|
|
|
||||
Common stock |
|
|
3 |
|
|
|
1 |
|
Additional paid in capital |
|
|
37,041 |
|
|
|
33,271 |
|
Accumulated deficit |
|
|
(33,883 |
) |
|
|
(29,642 |
) |
TOTAL STOCKHOLDERS' EQUITY |
|
|
3,161 |
|
|
|
3,630 |
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
$ |
4,596 |
|
|
$ |
5,856 |
|
Tivic Health Systems, Inc. Condensed Statements of Operations (Unaudited) (in thousands, except share and per share data) |
||||||||||||||||
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
REVENUES |
|
$ |
161 |
|
|
$ |
528 |
|
|
$ |
537 |
|
|
$ |
956 |
|
COST OF SALES |
|
|
100 |
|
|
|
403 |
|
|
|
363 |
|
|
|
760 |
|
GROSS PROFIT |
|
|
61 |
|
|
|
125 |
|
|
|
174 |
|
|
|
196 |
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
||||||||
Research and development |
|
|
468 |
|
|
|
497 |
|
|
|
958 |
|
|
|
898 |
|
Sales and marketing |
|
|
452 |
|
|
|
1,125 |
|
|
|
910 |
|
|
|
1,809 |
|
General and administrative |
|
|
1,266 |
|
|
|
1,521 |
|
|
|
2,547 |
|
|
|
2,747 |
|
TOTAL OPERATING EXPENSES |
|
|
2,186 |
|
|
|
3,143 |
|
|
|
4,415 |
|
|
|
5,454 |
|
NET OPERATING LOSS |
|
|
(2,125 |
) |
|
|
(3,018 |
) |
|
|
(4,241 |
) |
|
|
(5,258 |
) |
OTHER INCOME, NET |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
NET LOSS |
|
$ |
(2,125 |
) |
|
$ |
(3,018 |
) |
|
$ |
(4,241 |
) |
|
$ |
(5,258 |
) |
NET LOSS PER SHARE - BASIC AND DILUTED |
|
$ |
(0.07 |
) |
|
$ |
(0.32 |
) |
|
$ |
(0.17 |
) |
|
$ |
(0.55 |
) |
WEIGHTED-AVERAGE NUMBER OF SHARES - BASIC AND DILUTED |
|
|
29,677,734 |
|
|
|
9,621,484 |
|
|
|
24,926,353 |
|
|
|
9,668,100 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20230814274591/en/
Investor Contact:
Hanover International, Inc.
ir@tivichealth.com
Source: Tivic Health Systems, Inc.
