Allurion Technologies(US:ALUR)2024-08-14 20:30Financial Performance - Allurion generated revenue of $21.2 million for the six months ended June 30, 2024, compared to $27.0 million for the same period in 2023, reflecting a decrease of approximately 21%[159]. - The company incurred a net loss of $39.8 million for the six months ended June 30, 2023, while achieving a net income of $3.4 million for the same period in 2024[159]. - Revenue decreased by $1.2 million, or 9%, to $11.8 million for the three months ended June 30, 2024, and decreased by $5.8 million, or 22%, to $21.2 million for the six months ended June 30, 2024, compared to the same periods in 2023[185]. - Gross profit decreased by $1.0 million, or 10%, to $9.0 million for the three months ended June 30, 2024, and decreased by $5.2 million, or 25%, to $15.9 million for the six months ended June 30, 2024[187]. - The company recorded a loss of $8.7 million on extinguishment of debt for both the three and six months ended June 30, 2024[195]. - As of June 30, 2024, the company had $19.3 million in cash and cash equivalents, with an accumulated deficit of $209.4 million[198]. - Cash outflows from operating activities were $17.6 million for the six months ended June 30, 2024, compared to $20.0 million for the same period in 2023[198]. - The company has substantial doubt about its ability to continue as a going concern for a period of one year from the date of the financial statements due to recurring losses and the need for additional capital[199]. Product Development and Market Presence - Allurion completed the enrollment of 550 patients in the AUDACITY clinical trial across 17 sites in the United States during the third quarter of 2023[158]. - The Allurion VCS was launched in the United States in April 2024 for patients utilizing various weight loss treatments, including anti-obesity medications and bariatric surgery[157]. - The Allurion Program includes the world's first swallowable, procedure-less intragastric balloon for weight loss, along with AI-powered remote patient monitoring tools[155]. - The Allurion App integrates data from the Allurion Connected Scale to monitor various health metrics and is available in 15 languages[156]. - Allurion's products are currently sold in multiple regions, including Europe, the Middle East, Africa, Latin America, Canada, and the Asia-Pacific region[158]. - The company aims to increase market acceptance of its products to drive sales growth and expand its customer base in existing and new markets[171]. - Regulatory approval and timely introduction of new products are critical for the company's sales growth and market presence[172]. Financial Agreements and Capital Structure - The company issued $48 million in convertible senior secured notes with an annual interest rate of 6.0%, maturing on April 16, 2031[163]. - The company has increased the revenue interest payments to be paid to RTW from 6% to 12% for net sales less than or equal to $100 million prior to December 31, 2026[164]. - The public offering on June 28, 2024, resulted in gross proceeds of $17.3 million from the sale of 14,406,508 shares at an offering price of $1.20 per share[167]. - A private placement on June 28, 2024, generated approximately $2.7 million from the sale of 2,260,159 shares of Series A Preferred Stock and accompanying warrants[168]. - The company received $48 million in gross proceeds from the Amended Note Purchase Agreement with RTW on April 16, 2024, which was used to repay the Fortress Term Loan[205]. - The Revenue Interest Financing Agreement with RTW provided $40 million in proceeds, with an increased revenue interest payment rate from 6% to 12% for net sales less than or equal to $100 million prior to December 31, 2026[206]. Operational Expenses - Operating expenses include sales and marketing, research and development, and general and administrative costs, impacting overall financial performance[176][177]. - Sales and marketing expenses decreased by $3.6 million, or 35%, to $6.7 million for the three months ended June 30, 2024, and decreased by $9.3 million, or 42%, to $12.8 million for the six months ended June 30, 2024[188]. - Research and development expenses decreased by $2.3 million, or 35%, to $4.3 million for the three months ended June 30, 2024, and decreased by $4.4 million, or 30%, to $10.0 million for the six months ended June 30, 2024[189]. - General and administrative expenses increased by $0.9 million, or 14%, to $7.3 million for the three months ended June 30, 2024, and increased by $2.0 million, or 17%, to $13.7 million for the six months ended June 30, 2024[190][191]. - Interest expense decreased by $2.2 million, or 86%, to $0.3 million for the three months ended June 30, 2024, and decreased by $2.5 million, or 52%, to $2.3 million for the six months ended June 30, 2024[192]. Regulatory and Compliance Issues - The French regulatory authority suspended sales of the Allurion Balloon, prompting the company to withdraw the device from the French market pending a remediation plan[169]. - The company received a letter from NYSE regarding non-compliance with the minimum share price requirement, with an average closing price below $1.00 for 30 consecutive business days[170]. - The company is classified as an emerging growth company, allowing it to delay adopting new accounting standards[221]. Cash Flow and Investments - Net cash used in investing activities was $0.5 million for the six months ended June 30, 2024, primarily for purchases of property and equipment[212]. - Cash used in financing activities was $0.7 million for the six months ended June 30, 2024, including a $47.7 million repayment of the Fortress Term Loan[213]. - As of June 30, 2024, the company had cash and cash equivalents totaling $19.3 million, primarily invested in money market funds[222]. - A hypothetical 10% change in interest rates would not have a material impact on the value of cash, cash equivalents, net loss, or cash flows[222]. - A 10% adverse change in foreign exchange rates could impact revenues by approximately 7% and net income by approximately 6%[222].