EX-99.1 2 biol-ex99_1.htm EX-99.1 EX-99.1

 

img239377025_0.jpg 

Exhibit 99.1

 

BIOLASE REPORTS 46% REVENUE GROWTH IN 2021 THIRD QUARTER; DEMAND FOR DENTAL LASERS FROM NEW CUSTOMERS REMAINS HIGH AND CONTINUES TO FUEL GROWTH

Expects Significant Revenue Growth Year-Over-Year in Fourth Quarter 2021

Foothill Ranch, Calif., November 10, 2021 – BIOLASE, Inc. (NASDAQ: BIOL), the global leader in dental lasers, today announced its financial results for its third quarter ended September 30, 2021 and provided fourth quarter 2021 revenue guidance.

2021 Third Quarter Operating Highlights (all comparisons are on a year-over-year basis unless specified otherwise):

Net revenue grew 46% to $9.5 million:
o
78% of U.S. laser sales came from new customers, continuing a positive trend
o
Approximately 35% of U.S. Waterlase sales came from dental specialists
Net revenue was 10% higher than third quarter of 2019, which was the last pre-pandemic comparable period
Laser system sales increased 64%
Consumables and other revenue increased 21%
U.S. and international revenue increased 25% and 101%, respectively, as more dental practices were operating during the 2021 third quarter compared to the year-ago third quarter due to the COVID-19 pandemic
Gross margin was 51%, up 1,600 basis points, due to the higher year-over-year revenue, favorable revenue mix and higher average selling prices for products sold during the quarter
Maintained strong balance sheet, as cash and cash equivalents totaled $33.4 million at quarter end

 

"Our strong third quarter performance continues to reflect the rising demand for our industry-leading dental lasers,” commented John Beaver, President and Chief Executive Officer. “Our efforts to both educate and train dental specialists is leading to increased adoption across these large and largely untapped markets. In today's environment, the fact that BIOLASE lasers provide increased safety to dentists and their patients is generating a high level of acceptance by dental practitioners - and we expect this to be a driving force for the foreseeable future. Our industry-leading dental lasers aim to provide a better standard of care for dental procedures and seek to ensure a safer experience while reducing the risk of future procedure and business disruptions by reducing aerosolization to mitigate the spread of infectious pathogens, such as COVID-19. Looking ahead, we expect significant year-over-year improvement across our key performance metrics, including revenue and gross margin in the fourth quarter as we continue to gain momentum with new customers and dental specialists.”

2021 Third Quarter Financial Results

Net revenue for the third quarter of 2021 was $9.5 million, an increase of 46% compared to net revenue of $6.5 million for the third quarter of 2020, which was impacted by the COVID-19 pandemic as many dental practitioners were forced to suspend procedures. U.S. laser revenue was $3.4 million for the third quarter of 2021, up 25% when compared to U.S. laser revenue of $2.7 million for the third quarter of 2020. U.S. consumables and other revenue for the third quarter of 2021, which consists of revenue from consumable products such as disposable tips, increased 26% compared to the third quarter of 2020. Outside the U.S., laser revenue increased 168% to $2.7 million for the third quarter of 2021, compared to $1.0 million for the third quarter of 2020, and consumables and other revenue increased 13% year over year as recovery from the pandemic improved internationally.

 

 

Gross margin for the third quarter of 2021 was 51%, compared to 35% for the third quarter of 2020. The higher gross margin reflects the impact of the increase in revenues and increased average selling prices for products sold during the third quarter of 2021. Total operating expenses were $7.5 million for the third quarter of 2021, compared to $5.9 million for the third quarter of 2020. Operating loss for the third quarter of 2021, was $2.7 million, compared to an operating loss of $3.7 million in the third quarter of 2020. Net loss for the third quarter of 2021 was $3.3 million, or $0.02 per share, compared to a net income of $12,000, or less than $0.01 per share, for the third quarter of 2020.

Adjusted EBITDA loss for the third quarter of 2021 was $2.5 million, or $0.02 per share, compared to Adjusted EBITDA loss of $2.5 million, or $0.03 per share, for the third quarter of 2020.

 

Cash and cash equivalents totaled $33.4 million as of September 30, 2021. Due to the proactive and strategic decisions the Company took over the past year, BIOLASE’s balance sheet remains historically strong, and is providing it with the resources the Company believes it needs to execute its growth strategies for several years without having to access the capital markets.

2021 Fourth Quarter Revenue Guidance

The Company continues to experience high demand for its dental lasers and is currently forecasting revenue for the fourth quarter ending December 31, 2021 to be above the pre-pandemic revenue in the fourth quarter of 2019 of $10.2 million.

Conference Call Information

BIOLASE, Inc. will host a conference call today at 4:30 p.m. Eastern Time to discuss its operating results for the third quarter ended September 30, 2021, and to answer questions. For both "listen-only" participants and those participants who wish to take part in the question-and-answer portion of the call, the dial-in number in the U.S./Canada is (800) 367-2403. For international participants outside the U.S./Canada, the dial-in number is (334) 777-6978. For all callers, refer to the Conference ID 3599686. To access the live webcast, visit the Investor Relations section of the BIOLASE website at www.biolase.com and see “Investor Events”.

An audio archive of the webcast will be available on the Investor Relations section of the BIOLASE website.

About BIOLASE

BIOLASE is a medical device company that develops, manufactures, markets, and sells laser systems in dentistry and medicine. BIOLASE's products advance the practice of dentistry and medicine for patients and healthcare professionals. BIOLASE's proprietary laser products incorporate approximately 271 patented and 40 patent-pending technologies designed to provide biologically and clinically superior performance with less pain and faster recovery times. BIOLASE's innovative products provide cutting-edge technology at competitive prices to deliver superior results for dentists and patients. BIOLASE's principal products are revolutionary dental laser systems that perform a broad range of dental procedures, including cosmetic and complex surgical applications. BIOLASE has sold over 41,200 laser systems to date in over 80 countries around the world. Laser products under development address BIOLASE's core dental market and other adjacent medical and consumer applications.

For updates and information on Waterlase iPlus®, Waterlase Express™, and laser dentistry, find BIOLASE online at www.biolase.com, Facebook at www.facebook.com/biolase, Twitter at www.twitter.com/biolaseinc, Instagram at www.instagram.com/waterlase_laserdentistry, and LinkedIn at www.linkedin.com/company/biolase.

BIOLASE®, Waterlase® and Waterlase iPlus® are registered trademarks of BIOLASE, Inc.

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties, including statements regarding BIOLASE’s expected

 

 

future revenue, gross margin and other key metrics; anticipated demand for BIOLASE's products and anticipated driving forces such as demand; and anticipated cash needs. Forward-looking statements can be identified through the use of words such as may,” “might,” “will,” “intend,” “should,” “could,” “can,” “would,” “continue,” “expect,” “believe,” “anticipate,” “estimate,” “predict,” “outlook,” "forecast," “guidance,” “potential,” “plan,” “seek,” and similar expressions and variations or the negatives of these terms or other comparable terminology. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect BIOLASE’s current expectations and speak only as of the date of this release. Actual results may differ materially from BIOLASE’s current expectations depending upon a number of factors. These factors include, among others, the coronavirus (COVID-19) and the effects of the pandemic and actions taken in connection therewith, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business, and those other risks and uncertainties that are described in the "Risk Factors" section of BIOLASE's most recent annual report filed on Form 10-K and BIOLASE's quarterly report for the second quarter of 2021 filed on Form 10-Q filed with the Securities and Exchange Commission. Except as required by law, BIOLASE does not undertake any responsibility to revise or update any forward-looking statements.

 

For further information, please contact:

BIOLASE, Inc.

John R. Beaver, President and Chief Executive Officer

833-BIOLASE

jbeaver@biolase.com

or

EVC Group LLC

Michael Polyviou / Todd Kehrli

(732) 933-2754

mpolyviou@evcgroup.com / tkehrli@evcgroup.com

Tables to Follow

 

 

 

BIOLASE, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited, in thousands, except per share data)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Net revenue

 

$

9,531

 

 

$

6,539

 

 

$

26,780

 

 

$

14,260

 

Cost of revenue

 

 

4,689

 

 

 

4,265

 

 

 

15,157

 

 

 

9,692

 

Gross profit

 

 

4,842

 

 

 

2,274

 

 

 

11,623

 

 

 

4,568

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Sales and marketing

 

 

3,451

 

 

 

2,678

 

 

 

10,315

 

 

 

7,475

 

General and administrative

 

 

2,479

 

 

 

2,300

 

 

 

8,613

 

 

 

7,446

 

Engineering and development

 

 

1,540

 

 

 

963

 

 

 

4,506

 

 

 

2,644

 

Loss on patent litigation settlement

 

 

29

 

 

 

—

 

 

 

190

 

 

 

—

 

Total operating expenses

 

 

7,499

 

 

 

5,941

 

 

 

23,624

 

 

 

17,565

 

Loss from operations

 

 

(2,657

)

 

 

(3,667

)

 

 

(12,001

)

 

 

(12,997

)

Gain (Loss) on foreign currency transactions

 

 

(36

)

 

 

53

 

 

 

(172

)

 

 

(68

)

Interest expense, net

 

 

(569

)

 

 

(568

)

 

 

(1,727

)

 

 

(1,782

)

Gain on debt forgiveness

 

 

—

 

 

 

—

 

 

 

3,014

 

 

 

—

 

Other income, net

 

 

—

 

 

 

4,209

 

 

 

—

 

 

 

4,209

 

Non-operating gain (loss), net

 

 

(605

)

 

 

3,694

 

 

 

1,115

 

 

 

2,359

 

Loss before income tax (provision) benefit

 

 

(3,262

)

 

 

27

 

 

 

(10,886

)

 

 

(10,638

)

Income tax (provision) benefit

 

 

(14

)

 

 

(15

)

 

 

7

 

 

 

(49

)

Net income (loss)

 

 

(3,276

)

 

 

12

 

 

 

(10,879

)

 

 

(10,687

)

Other comprehensive loss items:

 

 

 

 

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

 

 

(90

)

 

 

111

 

 

 

(173

)

 

 

167

 

Comprehensive income (loss)

 

$

(3,366

)

 

$

123

 

 

$

(11,052

)

 

$

(10,520

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss)

 

$

(3,276

)

 

$

12

 

 

$

(10,879

)

 

$

(10,687

)

Deemed dividend on convertible preferred stock

 

 

(9

)

 

 

(17,378

)

 

 

(546

)

 

 

(17,378

)

Net loss attributable to common stockholders

 

$

(3,285

)

 

$

(17,366

)

 

$

(11,425

)

 

$

(28,065

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share attributable to common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

(0.02

)

 

$

(0.21

)

 

$

(0.08

)

 

$

(0.56

)

Diluted

 

$

(0.02

)

 

$

(0.21

)

 

$

(0.08

)

 

$

(0.56

)

Shares used in the calculation of net loss per share:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

151,941

 

 

 

81,341

 

 

 

145,809

 

 

 

50,366

 

Diluted

 

 

151,941

 

 

 

81,341

 

 

 

145,809

 

 

 

50,366

 

 

 

 

 

BIOLASE, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except per share data)

 

 

September 30,

 

 

December 31,

 

 

 

2021

 

 

2020

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

33,385

 

 

$

17,564

 

Restricted cash

 

 

204

 

 

 

312

 

Accounts receivable, less allowance of $2,871 and $4,017 as of September 30, 2021 and December 31, 2020, respectively

 

 

3,637

 

 

 

3,059

 

Inventory

 

 

14,062

 

 

 

11,157

 

Prepaid expenses and other current assets

 

 

1,366

 

 

 

3,018

 

Total current assets

 

 

52,654

 

 

 

35,110

 

Property, plant, and equipment, net

 

 

889

 

 

 

782

 

Goodwill

 

 

2,926

 

 

 

2,926

 

Right of use asset

 

 

1,823

 

 

 

1,976

 

Other assets

 

 

222

 

 

 

231

 

Total assets

 

$

58,514

 

 

$

41,025

 

LIABILITIES, REDEEMABLE PREFERRED STOCK AND
   STOCKHOLDERS' EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Accounts payable

 

$

3,597

 

 

$

2,651

 

Accrued liabilities

 

 

6,182

 

 

 

6,667

 

Deferred revenue, current portion

 

 

2,278

 

 

 

1,905

 

Term loan, net of discount

 

 

1,400

 

 

 

—

 

Total current liabilities

 

 

13,457

 

 

 

11,223

 

Deferred revenue

 

 

294

 

 

 

374

 

Warranty accrual

 

 

472

 

 

 

384

 

Non current term loans, net of discount

 

 

12,114

 

 

 

16,186

 

Non current operating lease liability

 

 

1,557

 

 

 

1,774

 

Other liabilities

 

 

298

 

 

 

1,056

 

Total liabilities

 

 

28,192

 

 

 

30,997

 

Stockholders' equity:

 

 

 

 

 

 

Series F Preferred stock, par value $0.001 per share

 

 

34

 

 

 

118

 

Common stock, par value $0.001 per share

 

 

153

 

 

 

98

 

Additional paid-in capital

 

 

292,948

 

 

 

261,573

 

Accumulated other comprehensive loss

 

 

(558

)

 

 

(385

)

Accumulated deficit

 

 

(262,255

)

 

 

(251,376

)

Total stockholders' equity

 

 

30,322

 

 

 

10,028

 

Total liabilities, redeemable preferred stock and stockholders' equity

 

$

58,514

 

 

$

41,025

 

 

 

 

BIOLASE, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited, in thousands)

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2021

 

 

2020

 

Cash Flows from Operating Activities:

 

 

 

 

 

 

Net loss

 

$

(10,879

)

 

$

(10,687

)

Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

281

 

 

 

527

 

Provision for bad debts

 

 

(162

)

 

 

1,263

 

Provision for sales returns

 

 

—

 

 

 

87

 

Inventory write-offs and disposals

 

 

(117

)

 

 

—

 

Amortization of discount on lines of credit

 

 

126

 

 

 

123

 

Amortization of debt issuance costs

 

 

290

 

 

 

240

 

Patent litigation mark-to-market

 

 

190

 

 

 

—

 

Change in fair value of warrants

 

 

—

 

 

 

(5,850

)

Issuance of restricted shares

 

 

164

 

 

 

—

 

Issuance costs for common stock warrants

 

 

—

 

 

 

1,640

 

Stock-based compensation

 

 

1,488

 

 

 

2,367

 

Gain on debt forgiveness

 

 

(3,014

)

 

 

—

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

Accounts receivable

 

 

(417

)

 

 

4,017

 

Inventory

 

 

(2,788

)

 

 

(1,597

)

Prepaid expenses and other current assets

 

 

235

 

 

 

430

 

Accounts payable and accrued liabilities

 

 

705

 

 

 

(3,445

)

Deferred revenue

 

 

292

 

 

 

(562

)

Net cash and cash equivalents used in operating activities

 

 

(13,606

)

 

 

(11,447

)

Cash Flows from Investing Activities:

 

 

 

 

 

 

Purchases of property, plant, and equipment

 

 

(396

)

 

 

(78

)

Net cash and cash equivalents used in investing activities

 

 

(396

)

 

 

(78

)

Cash Flows from Financing Activities:

 

 

 

 

 

 

Proceeds from the sale of common stock

 

 

13,291

 

 

 

6,912

 

Proceeds from the sale of common stock warrants

 

 

—

 

 

 

15,300

 

Proceeds from the issuance of Series F Convertible Preferred Stock

 

 

—

 

 

 

2,700

 

Payments of equity offering costs

 

 

(6

)

 

 

(1,281

)

Payment of July 2020 Warrant issuance costs

 

 

—

 

 

 

(1,640

)

Borrowings on other long-term loans

 

 

—

 

 

 

3,140

 

Principal payment on loan

 

 

—

 

 

 

(700

)

Borrowings on credit facility

 

 

—

 

 

 

3,000

 

Repayment of credit facility

 

 

—

 

 

 

(3,000

)

Proceeds from the exercise of common stock warrants

 

 

16,560

 

 

 

46

 

Payment of debt issuance costs

 

 

(25

)

 

 

(75

)

Proceeds from exercise of stock options

 

 

66

 

 

 

—

 

Net cash and cash equivalents provided by financing activities

 

 

29,886

 

 

 

24,402

 

Effect of exchange rate changes

 

 

(171

)

 

 

181

 

Increase in cash, cash equivalents and restricted cash

 

 

15,713

 

 

 

13,058

 

Cash, cash equivalents and restricted cash, beginning of period

 

 

17,876

 

 

 

6,101

 

Cash, cash equivalents and restricted cash, end of period

 

$

33,589

 

 

$

19,159

 

Supplemental cash flow disclosure:

 

 

 

 

 

 

Cash paid for interest

 

$

1,328

 

 

$

1,438

 

Cash received for interest

 

$

44

 

 

$

—

 

Cash paid for income taxes

 

$

154

 

 

$

21

 

Cash paid for operating leases

 

$

185

 

 

$

417

 

Non-cash settlement of liability

 

$

510

 

 

$

151

 

Non-cash right-of-use assets obtained in exchange for lease obligation

 

$

48

 

 

$

2,037

 

Deemed dividend on preferred stock

 

$

546

 

 

$

17,378

 

Warrants issued in connection with debt instruments

 

$

—

 

 

$

67

 

 

 

 

Non-GAAP Financial Measures

In addition to the financial information prepared in conformity with generally accepted accounting principles in the U.S. (“GAAP”), this press release includes certain historical non-GAAP financial information. Management believes that these non-GAAP financial measures assist investors in making comparisons of period-to-period operating results and that, in some respects, these non-GAAP financial measures are more indicative of the Company’s ongoing core operating performance than their GAAP equivalents.

Adjusted EBITDA is defined as net income (loss) before interest, taxes, depreciation and amortization, loss on patent litigation settlement, stock-based and other non-cash compensation, debt forgiveness, other net income, and allowance for doubtful accounts. Management uses Adjusted EBITDA in its evaluation of the Company’s core results of operations and trends between fiscal periods and believes that these measures are important components of its internal performance measurement process. Therefore, investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Further, the non-GAAP financial measures presented by the Company may be different from similarly named non-GAAP financial measures used by other companies.

 

BIOLASE, INC.

Reconciliation of GAAP Net Loss to Adjusted EBITDA and

GAAP Net Loss Per Share to Adjusted EBITDA Per Share

(Unaudited, in thousands, except per share data)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

GAAP net loss attributable to common stockholders

 

$

(3,285

)

 

$

(17,366

)

 

$

(11,425

)

 

$

(28,065

)

Deemed dividend on convertible preferred stock

 

 

9

 

 

 

17,378

 

 

 

546

 

 

 

17,378

 

GAAP net income (loss)

 

$

(3,276

)

 

$

12

 

 

$

(10,879

)

 

$

(10,687

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

569

 

 

 

568

 

 

 

1,727

 

 

 

1,782

 

Income tax provision (benefit)

 

 

14

 

 

 

15

 

 

 

(7

)

 

 

49

 

Depreciation and amortization

 

 

101

 

 

 

46

 

 

 

281

 

 

 

527

 

Change in allowance for doubtful accounts

 

 

(83

)

 

 

256

 

 

 

(162

)

 

 

1,263

 

Loss on patent litigation settlement

 

 

29

 

 

 

—

 

 

 

190

 

 

 

—

 

Stock-based and other non-cash compensation

 

 

192

 

 

 

847

 

 

 

1,488

 

 

 

2,367

 

Gain on debt forgiveness

 

 

—

 

 

 

—

 

 

 

(3,014

)

 

 

—

 

Other (income) expense, net

 

 

—

 

 

 

(4,209

)

 

 

—

 

 

 

(4,209

)

Adjusted EBITDA

 

$

(2,454

)

 

$

(2,465

)

 

$

(10,376

)

 

$

(8,908

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP net loss attributable to common stockholders
   per share, basic and diluted

 

$

(0.02

)

 

$

(0.21

)

 

$

(0.08

)

 

$

(0.56

)

Deemed dividend on convertible preferred stock

 

 

—

 

 

 

0.21

 

 

 

—

 

 

 

0.35

 

GAAP net loss per share, basic and diluted

 

$

(0.02

)

 

$

—

 

 

$

(0.08

)

 

$

(0.21

)

Adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

 

 

—

 

 

 

0.01

 

 

 

0.01

 

 

 

0.04

 

Income tax provision (benefit)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Depreciation and amortization

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.01

 

Change in allowance for doubtful accounts

 

 

—

 

 

 

—

 

 

 

—

 

 

 

0.03

 

Loss on patent litigation settlement

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

Stock-based and other non-cash compensation

 

 

—

 

 

 

0.01

 

 

 

0.01

 

 

 

0.05

 

Gain on debt forgiveness

 

 

—

 

 

 

—

 

 

 

(0.02

)

 

 

—

 

Other (income) expense, net

 

 

—

 

 

 

(0.05

)

 

 

—

 

 

 

(0.10

)

Adjusted EBITDA per share, basic and diluted

 

$

(0.02

)

 

$

(0.03

)

 

$

(0.08

)

 

$

(0.18

)