Avinger, Inc. (NASDAQ:AVGR) Q3 2020 Earnings Conference Call November 10, 2020 4:30 PM ET Company Participants Matt Kreps – Investor Relations Jeff Soinski – Chief Executive Officer Mark Weinswig – Chief Financial Officer Conference Call Participants Rommel Dionisio – Aegis Capital Operator Greetings, and welcome to the Avinger Third Quarter 2020 Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Ins ...

Financial Performance - The company generated revenues of $9.1 million in 2019, an increase from $7.9 million in 2018, primarily due to the launch of the next-generation Pantheris and Pantheris SV products [124]. - As of September 30, 2020, the company reported a net loss of $4.5 million for the third quarter and a comprehensive net loss of $14.4 million for the nine months, with an accumulated deficit of $362.7 million [135]. - For the three months ended September 30, 2020, revenues were $2.302 million, a decrease of 4.5% compared to $2.410 million for the same period in 2019 [158]. - The net loss for the three months ended September 30, 2020, was $4.525 million, compared to a net loss of $4.623 million for the same period in 2019 [158]. - For the nine months ended September 30, 2020, revenue decreased by $0.5 million or 8% compared to the same period in 2019, reflecting the impact of COVID-19 on elective procedures [167]. Sales and Market Impact - The company experienced a significant decline in sales during the second quarter of 2020 due to COVID-19, but saw a rebound in sales in the third quarter as elective procedures resumed [125]. - The company is focused on interventional cardiologists, vascular surgeons, and interventional radiologists for its marketing efforts, considering hospitals as key customers [123]. Product Development and Regulatory Approvals - The company received 510(k) clearance for the Pantheris SV in April 2019, targeting smaller vessels, and commenced sales in July 2019 [116]. - The company received 510(k) clearance for the Ocelaris ("Tigereye") system in September 2020, which features high-definition imaging and a user-controlled deflectable tip [117]. - The company is developing the next generation of the Lightbox imaging console, the L300, with enhanced imaging capabilities and plans to file a 510(k) submission in the first quarter of 2021 [122]. Expenses and Cost Management - Total operating expenses for the three months ended September 30, 2020, were $4.878 million, down from $5.462 million in the same period of 2019 [158]. - Research and development expenses for the three months ended September 30, 2020, were $1.417 million, an increase from $1.371 million in the same period of 2019 [158]. - Selling, general and administrative expenses for the three months ended September 30, 2020, were $3.461 million, down from $4.091 million in the same period of 2019 [158]. - SG&A expense for the three months ended September 30, 2020 decreased by approximately $0.6 million or 15% compared to the same period in 2019, mainly due to reduced compensation costs and lower third-party expenses [164]. Financing and Cash Flow - The company received a loan of $2.3 million under the Paycheck Protection Program on April 23, 2020, to help mitigate the effects of COVID-19 [129]. - The company completed a public offering of 12.6 million shares of common stock at an offering price of $0.25 per share on April 30, 2020, resulting in net proceeds of approximately $3.0 million [145]. - Net cash used in operating activities for the nine months ended September 30, 2020 was $11.7 million, consisting primarily of a net loss of $14.4 million and an increase in net operating assets of approximately $0.8 million [191]. - Net cash provided by financing activities for the nine months ended September 30, 2020 was $26.0 million, primarily from the issuance of common stock and $2.3 million from borrowings under the PPP [194]. Future Outlook - The company expects gross margin to increase over the long term as production volume increases and fixed manufacturing overhead costs are spread over a larger number of units produced [153]. - The company expects to incur losses for the foreseeable future and believes its current cash and expected revenues will be sufficient to fund operations through at least the fourth quarter of 2021 [174]. Compliance and Risk Management - The company is actively monitoring compliance with Nasdaq Listing Rules, having received a notice regarding non-compliance due to the stock price being below $1 [131]. - An immediate 100 basis point change in interest rates would not have a material effect on the fair value of the company's cash equivalents [200]. - The company maintains cash and cash equivalents with one financial institution, which is believed to have sufficient assets and liquidity, posing little credit risk [201].

Financial Data and Key Metrics Changes - Total revenue for Q2 2020 was $1.5 million, a decrease of 37% from $2.3 million in Q2 2019 and a decline from $2.3 million in Q1 2020, primarily due to COVID-19 impacts [21][10] - Gross margin in Q2 2020 was 24%, compared to 31% in the same quarter last year, affected by reduced volumes and excess inventory charges [22] - Operating expenses decreased to $4 million in Q2 2020 from $6 million in Q1 2020 and $5.4 million in Q2 2019, reflecting successful cost reduction efforts [23] - Net loss attributable to common shareholders was $5 million in Q2 2020, down from $6.8 million in Q1 2020 and $5.5 million in Q2 2019 [23] - Adjusted EBITDA loss was $2.9 million, an improvement from $4.8 million in Q1 2020 and $4 million in Q2 2019, marking the best results in the company's history [24] - Cash and cash equivalents totaled $16.6 million as of June 30, 2020, up from $9.9 million as of March 31, 2020, bolstered by financing activities [25] Business Line Data and Key Metrics Changes - Pantheris revenue declined by 13% year-over-year, with strong relative performance attributed to the introduction of Pantheris SV [21] - Disposable sales decreased by 28%, but Pantheris sales only declined by 13%, indicating resilience in the product line [11] - Console-related sales and service revenue increased slightly on a sequential basis as new sites were rolled out [22] Market Data and Key Metrics Changes - Procedural volume saw a significant increase in May and June as states began to loosen restrictions, with July 2020 revenues higher than both July 2019 and July 2018 [10] - The company added 27 new lumivascular sites in the trailing 12 months, with five new sites launched in July 2020 [12][13] Company Strategy and Development Direction - The company is focused on expanding its proprietary image-guided approach to treating peripheral artery disease (PAD) and anticipates growth from the upcoming launch of Ocellaris, its next-generation CTO crossing system [8] - Avinger is committed to improving operational efficiency and has implemented cost-reduction measures while continuing to invest in product development [19][23] - The company plans to submit a 510(k) application for the L300 Lightbox imaging console, expected to enhance new account acquisition and operational efficiency [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery from COVID-19 impacts, noting increased case activity and utilization trends continuing into the third quarter [27] - The company remains aware of ongoing challenges posed by the pandemic but is encouraged by positive progress and the resilience shown by the team [20][19] - Management anticipates FDA clearance for Ocellaris in the second half of 2020, with plans for a limited launch following approval [14][34] Other Important Information - The company has maintained its manufacturing operations as an essential business during the pandemic and has built safety inventory to meet customer needs [19] - Avinger has made significant progress in clinical studies despite delays due to COVID-19, with plans to resume patient enrollment in the fourth quarter [18][35] Q&A Session Summary Question: How was the sales performance in the recent quarter better than expected? - Management noted that the impact of COVID-19 was less severe than anticipated, with increased utilization in May and June contributing to better-than-expected revenue [30][31] Question: Are there any anticipated disruptions in the new product pipeline due to COVID? - Management confirmed that the Ocellaris timeline remains on track, with no significant delays expected in product development despite some slowdowns in clinical studies [34][35] Question: What is the outlook on the reimbursement environment? - Management indicated no significant changes are expected in reimbursement for atherectomy codes, with potential incremental opportunities related to imaging claims [37]

Financial Performance - The company generated revenues of $9.9 million in 2017, $7.9 million in 2018, and $9.1 million in 2019, with growth in 2019 attributed to the next-generation Pantheris and the launch of Pantheris SV[114]. - As of June 30, 2020, the company reported a net loss of $4.0 million for the quarter and $9.9 million for the six months, with an accumulated deficit of $358.2 million since inception[123]. - For the three months ended June 30, 2020, revenue decreased by approximately $0.9 million or 37% compared to the same period in 2019, primarily due to the deferral of elective procedures caused by the COVID-19 pandemic[147]. - For the six months ended June 30, 2020, revenue decreased by $0.4 million or 10% compared to the same period in 2019, reflecting the impact of COVID-19[156]. - The company reported a net loss of $9.9 million for the six months ended June 30, 2020, which was partially offset by non-cash charges of $2.4 million[178]. COVID-19 Impact - The company has experienced a significant decline in sales due to COVID-19, particularly as elective procedures were deferred[115]. - The company has taken measures to manage cash and resources during COVID-19, including a 20% reduction in base salaries for non-manufacturing employees and a 20% reduction in hours for manufacturing workers[117]. Financing Activities - The company received loan proceeds of $2.3 million under the Paycheck Protection Program on April 23, 2020, as part of the CARES Act[119]. - The company received loan proceeds of $2.3 million under the Paycheck Protection Program, which may be forgiven if used for qualifying expenses[133]. - Net cash provided by financing activities for the six months ended June 30, 2020 was $14.0 million, an increase of 74.4% compared to $8.0 million in the same period in 2019[181][183]. - The company completed a public offering of 17,979 shares of Series B preferred stock, receiving net proceeds of approximately $15.5 million after fees[127]. - The company sold 216,618 shares of common stock at an offering price of $16.425 per share, resulting in net proceeds of approximately $3.0 million[128]. - The company completed a public offering of 728,500 shares of common stock and 8,586 shares of Series C convertible preferred stock, receiving net proceeds of approximately $10.2 million[130]. - The company filed a universal shelf registration statement to offer up to $50.0 million of its securities, with a public offering of 3,813,559 shares of common stock at an offering price of $1.18 per share, resulting in net proceeds of approximately $3.8 million[131]. - The company completed a public offering of 6,428,572 shares of common stock at an offering price of $0.70 per share, receiving net proceeds of approximately $3.9 million[132]. - The company completed a public offering of 12,600,000 shares of common stock at an offering price of $0.25 per share, resulting in net proceeds of approximately $3.0 million[135]. - The company completed a public offering of 20,000,000 shares of common stock at an offering price of $0.27 per share, receiving net proceeds of approximately $5.5 million[136]. - The company completed a public offering of 23,000,000 shares at an offering price of $0.27 per share, resulting in net proceeds of approximately $5.5 million[174]. Operating Expenses - Total operating expenses for the three months ended June 30, 2020 were $3.951 million, a decrease of $1.475 million or 27% compared to $5.426 million in the same period of 2019[150]. - Research and development expenses for the three months ended June 30, 2020 decreased by less than $0.1 million or 3% compared to the same period in 2019, primarily due to cost reduction measures[151]. - Selling, general and administrative expenses for the three months ended June 30, 2020 decreased by approximately $1.4 million or 35% compared to the same period in 2019[153]. - Interest expense, net for the three months ended June 30, 2020 increased by $0.1 million or 50% compared to the same period in 2019, primarily due to a higher loan balance[154]. Cash and Liquidity - As of June 30, 2020, the company had cash and cash equivalents of $16.6 million, up from $10.9 million as of December 31, 2019[164]. - Net cash used in operating activities for the six months ended June 30, 2020 was $8.4 million, compared to $9.6 million for the same period in 2019, reflecting a decrease of 12.5%[178][179]. - The total CRG Loan amount as of June 30, 2020 is $9.8 million, with a contractual obligation of $14.2 million including future interest[182]. - The total PPP Loan amount as of June 30, 2020 is $2.33 million, with a contractual obligation of $2.36 million including future interest[186]. - The company maintains cash and cash equivalents with one financial institution, which is believed to have sufficient assets and liquidity to mitigate credit risk[189]. Future Outlook - The company anticipates 510(k) clearance for the Ocelaris product line extension by the end of 2020, which features enhanced imaging capabilities and a user-controlled deflectable tip[111]. - The company is progressing on the next generation Lightbox imaging console, the L300, with a 510(k) submission expected in Q4 2020 or Q1 2021[112]. - The company plans to submit a 510(k) application to expand the indication for the Pantheris device to include in-stent restenosis once the INSIGHT clinical trial is fully enrolled[110]. - The company expects gross margin to increase over the long term as production volume increases and fixed manufacturing overhead costs are spread over a larger number of units produced[141]. - The company expects to incur losses for the foreseeable future and may require additional financing to fund operations[165]. Regulatory and Compliance - The company received a Nasdaq delisting notice on March 10, 2020, due to the minimum bid price for its common stock being below $1 for 30 consecutive business days[120]. - There were no customers that represented more than 10% of accounts receivable as of June 30, 2020[190]. - The company does not currently use or plan to use financial derivatives in its investment portfolio, limiting interest rate risk exposure[188]. - The company had no investing activities during the six months ended June 30, 2020[185].

Avinger, Inc. (NASDAQ:AVGR) Q1 2020 Earnings Conference Call May 13, 2020 4:30 PM ET Company Participants Matt Kreps - Managing Director of Darrow Associates Jeff Soinski - Chief Executive Officer Mark Weinswig - Chief Financial Officer Conference Call Participants Nathan Weinstein - Aegis Capital Operator Good day, ladies and gentlemen, and welcome to your Avinger First Quarter 2020 Results Call. All lines have been placed on a listen-only mode. And the floor will be open for questions following the presen ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Title of each class: Trading Symbol(s): Name of each exchange on which registered: Common Stock, par value $0.001 per share AVGR The Nasdaq Capital Market FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36817 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 001-36817 AVINGER, INC. (Exact name of registrant as specified in its charter) Delaware 20-8873453 (State or other jurisdiction of (I.R.S. Employer incorporation or organ ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2019 was $2.4 million, a 19% increase from $2 million in Q3 2018 [20] - Catheter sales increased by 33% year-over-year, contributing to the overall revenue growth [7][20] - Gross margin improved to 35%, up from 31% in Q2 2019 and 27% in Q3 2018 [22] - Net loss before preferred dividends was $4.6 million, an improvement of 14% from $5.4 million in the prior year [24] Business Line Data and Key Metrics Changes - Pantheris revenue increased by 81% year-over-year and 48% quarter-over-quarter to $1.6 million, including over $400,000 from Pantheris SV [9] - Pantheris SV was launched in 25 sites during Q3, with expectations for increased revenue contribution in Q4 [7][11] - Sales for the Pantheris seven-French catheter increased by 29% year-over-year [8] Market Data and Key Metrics Changes - The atherectomy market in the U.S. is over $500 million and growing, with significant interest in the Pantheris product line [37] - The CTO crossing market is estimated at $90 million to $100 million, with potential for growth through the Ocellaris product [38] Company Strategy and Development Direction - The company is focused on expanding its product line with Pantheris SV and preparing for the launch of Ocellaris, aimed at treating chronic total occlusions [13][14] - Aiming to increase sales productivity and expand the customer base through a growing sales team, which increased from 20 to 28 members [12][41] - The company plans to maintain a lean operating cost structure while driving revenue growth and improving margins [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth potential of Pantheris SV and the overall product line, anticipating continued revenue growth [26] - The company is optimistic about the upcoming CE Marking for Ocellaris, which will facilitate its entry into the European market [14] - Management highlighted the importance of clinical outcomes and safety data in driving product adoption and market expansion [45] Other Important Information - Cash and cash equivalents totaled $14.5 million as of September 30, 2019, down slightly from $14.8 million at the end of Q2 2019 [25] - The company has made significant strides in reducing operating expenses while increasing sales and marketing investments [23] Q&A Session Summary Question: What was debt as of Sep 30? - The company had a debt balance of $8.6 million at the end of September, with payment terms beginning in 2021 [27] Question: Will operating expenses remain flat going forward? - The company expects to keep total operating expenses roughly flat while increasing sales and marketing spending [29] Question: What are total FTEs now approximately? - The company has approximately 83 employees, with about 28 in sales [30] Question: How does the company view future gross margin improvements? - Management is optimistic about further gross margin increases as revenue grows and operating efficiencies improve [32] Question: What is the user profile and utilization trends for Pantheris? - Pantheris SV has been shipped to 43 accounts, with ongoing interest and utilization primarily from the seven-French product [34] Question: What is the total addressable market (TAM) for the company's products? - The total market for atherectomy and CTO crossing is estimated to exceed $600 million, with significant growth potential [39] Question: Does the company feel it has good coverage in high PAD incident areas? - The company has strategically placed its sales team in key markets with high atherectomy procedure volumes and plans to expand further [41] Question: Will positive feedback on Pantheris SV accelerate broader rollout? - The company is currently in full national launch mode for Pantheris SV, having transitioned quickly from a limited launch [44]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Title of each class: Trading Symbol(s): Name of each exchange on which registered: Common Stock, par value $0.001 per share AVGR The Nasdaq Capital Market FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ...