On November 9, 2022 Vericel Corporation (NASDAQ:VCEL), a leader in advanced therapies for the sports medicine and severe burn care markets, reported financial results and business highlights for the third quarter ended September 30, 2022 (Press release, Vericel, NOV 9, 2022, View Source [SID1234623529]).
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Third Quarter 2022 Financial Highlights
•Total net revenue of $38.6 million
•MACI net revenue of $31.0 million, Epicel net revenue of $7.3 million, and NexoBrid revenue of $0.2 million
•Gross margin of 65%
•Net loss of $6.6 million, or $0.14 per share
•Non-GAAP adjusted EBITDA of $3.3 million
•Operating cash flow of $4.1 million
•As of September 30, 2022, approximately $133 million in cash and investments, and no debt
Business Highlights and Updates
•Third-quarter MACI revenue growth of 30% compared to the prior year and 8% sequential growth versus the prior quarter, representing the highest quarterly revenue outside of the seasonally-high fourth quarter since the launch of MACI
•Ninth straight quarter of positive adjusted EBITDA and operating cash flow
•FDA’s review of NexoBrid BLA is progressing, with inspections of manufacturing facilities in Taiwan and Israel underway
•Type C meeting with the FDA scheduled for December to discuss MACI arthroscopic delivery program
"The Company executed well in the third quarter, delivering strong MACI revenue growth, record third-quarter total revenue, and continued quarterly profitability and positive operating
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Exhibit 99.1
cash flow," said Nick Colangelo, President and CEO of Vericel. "We also continued to advance important pipeline programs with planned meetings with the FDA for both the MACI arthroscopic delivery and ankle development programs, as well as continued pre-launch activities for the potential launch of NexoBrid, which we believe positions the Company for continued strong growth in the years ahead."
Full-Year 2022 Financial Guidance Update
•Total net revenue expected to be in the range of $164 to $166 million
•MACI revenue expected to be approximately $130 to $132 million
•Total burn care revenue, including Epicel and NexoBrid, expected to be approximately $34 million
•Gross margin expected to be in the mid-60% range
•Adjusted EBITDA margin in the mid-teens % range
Third Quarter 2022 Results
Total net revenue for the quarter ended September 30, 2022 increased 12% to $38.6 million, compared to $34.5 million in the third quarter of 2021. Total net product revenue for the quarter included $31.0 million of MACI (autologous cultured chondrocytes on porcine collagen membrane) net revenue and $7.3 million of Epicel (cultured epidermal autografts) net revenue, compared to $23.9 million of MACI net revenue and $9.8 million of Epicel net revenue, respectively, in the third quarter of 2021. Total net revenue for the quarter also included $0.2 million of revenue related to the procurement of NexoBrid (concentrate of proteolytic enzymes enriched in bromelain) by the U.S. Biomedical Advanced Research and Development Authority (BARDA) for emergency response preparedness, compared to $0.8 million in the third quarter of 2021.
Gross profit for the quarter ended September 30, 2022 was $25.2 million, or 65% of net revenue, compared to $22.1 million, or 64% of net revenue, for the third quarter of 2021.
Total operating expenses for the quarter ended September 30, 2022 were $32.0 million, compared to $27.1 million for the same period in 2021. The increase in operating expenses was primarily due to an increase in employee expenses, continued investment in commercialization initiatives and additional stock-based compensation expense.
Net loss for the quarter ended September 30, 2022 was $6.6 million, or $0.14 per share, compared to $4.9 million, or $0.11 per share, for the third quarter of 2021.
Non-GAAP adjusted EBITDA for the quarter ended September 30, 2022 was $3.3 million, or 9% of net revenue, compared to $4.3 million, or 12% of net revenue, for the third quarter of 2021. A table reconciling non-GAAP measures is included in this press release for reference.
As of September 30, 2022, the Company had approximately $133 million in cash and investments, compared to approximately $129 million as of December 31, 2021, and no debt.
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Exhibit 99.1
Conference Call Information
Today’s conference call will be available live at 8:30am Eastern Time and can be accessed through the Investor Relations section of the Vericel website at View Source A slide presentation with highlights from today’s conference call will be available on the webcast and in the Investor Relations section of the Vericel website. Please access the site at least 15 minutes prior to the scheduled start time in order to download the required audio software, if necessary. To participate by telephone, please register here to receive dial-in details and your personal passcode. A replay of the webcast will be available on the Vericel website until November 9, 2023.