MDxHealth SA(MDXH) - 2024 Q4 - Annual Report

Key Highlights & CEO Commentary Mdxhealth reported strong Q4 and full-year 2024 results with 28% revenue growth, driven by robust demand for its precision diagnostics, with the CEO highlighting the company is on track for adjusted EBITDA profitability in the first half of 2025 and has strengthened its balance sheet with a new debt facility to support its 2025 business plan and an earnout obligation to Exact Sciences - CEO Michael K. McGarrity stated the company is on track to achieve adjusted EBITDA profitability in the first half of 2025, driven by strong adoption of its test menu and commercial team execution[2] - The balance sheet will be significantly strengthened by drawing the second tranche of the OrbiMed debt facility, intended to meet the 2025 earnout obligation to Exact Sciences and fund the 2025 business plan[2] Q4 and Full-Year 2024 Key Metrics | Metric | Q4 2024 | Q4 YoY Change | Full Year 2024 | FY YoY Change | | :--- | :--- | :--- | :--- | :--- | | Revenue (USD) | $24.7 million | +28% | $90.0 million | +28% | | Adjusted EBITDA (USD) | ($1.4) million | +68% improvement | ($14.7) million | +24% improvement | | Tissue-based Test Volume | 11,789 | +50% | N/A | N/A | | Liquid-based Test Volume | 12,036 | +10% | N/A | N/A | | Year-End Cash (USD) | N/A | N/A | $46.8 million | N/A | Financial Performance Analysis Mdxhealth achieved 28% revenue growth for both the fourth quarter and the full year of 2024, reaching $24.7 million and $90.0 million, respectively, accompanied by improved operating and net losses and a significant improvement in Adjusted EBITDA, although gross margins saw a slight decline due to test mix Fourth Quarter 2024 Financial Results Q4 2024 revenue grew 28% YoY to $24.7 million, primarily driven by tissue-based tests which accounted for 81% of revenue, with gross profit increasing 22% to $15.5 million, though gross margin slightly declined to 62.7% from 65.3% due to test mix and payment timing, and the company significantly improved its bottom line, with net loss decreasing by 36% to $6.8 million and Adjusted EBITDA improving by 68% to ($1.4) million Q4 2024 vs Q4 2023 Financial Performance (USD in millions) | Metric | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $24.7 | $19.4 | +28% | | Gross Profit | $15.5 | $12.7 | +22% | | Gross Margin | 62.7% | 65.3% | -2.6 p.p. | | Operating Expenses | $20.1 | $19.0 | +6% | | Net Loss | ($6.8) | ($10.7) | -36% | | Adjusted EBITDA | ($1.4) | ($4.4) | +68% improvement | - Tissue-based tests (Confirm mdx and GPS) were the primary revenue driver, accounting for 81% of total Q4 2024 revenue[6] - The 6% increase in operating expenses was primarily driven by higher R&D expenses related to clinical studies[7] Full Year 2024 Financial Results For the full year 2024, revenue increased 28% to $90.0 million, with tissue-based tests representing 80% of the total, gross profit rose 26% to $55.1 million, with a slight margin contraction to 61.2%, operating expenses grew 12% due to increased R&D for clinical trials and higher sales and marketing incentive compensation, net loss improved by 12% to $38.1 million, and Adjusted EBITDA improved by 24% to ($14.7) million, with the company ending the year with a strong cash position of $46.8 million Full Year 2024 vs 2023 Financial Performance (USD in millions) | Metric | FY 2024 | FY 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $90.0 | $70.2 | +28% | | Gross Profit | $55.1 | $43.9 | +26% | | Gross Margin | 61.2% | 62.6% | -1.4 p.p. | | Operating Expenses | $79.9 | $71.3 | +12% | | Net Loss | ($38.1) | ($43.1) | -12% | | Adjusted EBITDA | ($14.7) | ($19.4) | +24% improvement | - The increase in operating expenses was driven by R&D for clinical trials and higher sales and marketing expenses tied to revenue growth and incentive compensation[10] - Cash and cash equivalents stood at $46.8 million as of December 31, 2024[12] 2025 Outlook The company reaffirms its previously issued 2025 revenue guidance of $108-110 million and confirms its expectation to achieve adjusted EBITDA profitability in the first half of 2025 - Maintains 2025 revenue guidance of $108-110 million[13] - Expects to achieve adjusted EBITDA profitability in the first half of 2025[13] Consolidated Financial Statements This section presents the unaudited condensed consolidated financial statements for the year ended December 31, 2024, including the Statement of Profit or Loss, Statement of Financial Position, and Statement of Cash Flows, providing a detailed view of the company's financial health and performance Unaudited Condensed Consolidated Statement of Profit or Loss The statement details the company's revenues, costs, and expenses for Q4 and the full year of 2024 compared to 2023, with the company reporting revenues of $90.0 million and a net loss of $38.1 million for the full year 2024, an improvement from the $43.1 million net loss in 2023, and basic and diluted loss per share for FY 2024 was ($1.16), compared to ($1.66) in FY 2023 Full Year 2024 vs 2023 Statement of Profit or Loss (USD in thousands) | Account | 2024 | 2023 | | :--- | :--- | :--- | | Revenues | $90,049 | $70,193 | | Gross profit | $55,141 | $43,929 | | Operating loss | $(24,722) | $(27,327) | | Loss for the period | $(38,069) | $(43,100) | | Basic and diluted loss per share | $(1.16) | $(1.66) | Unaudited Condensed Consolidated Statement of Financial Position The balance sheet as of December 31, 2024, shows total assets of $157.3 million and total liabilities of $142.5 million, resulting in total equity of $14.8 million, with cash and cash equivalents significantly increasing to $46.8 million from $22.4 million at the end of 2023, while total liabilities also grew from $121.9 million Statement of Financial Position Highlights (USD in thousands) | Account | Dec 31, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | ASSETS | | | | Cash and cash equivalents | $46,798 | $22,380 | | Total current assets | $66,895 | $38,161 | | Total non-current assets | $90,434 | $90,971 | | TOTAL ASSETS | $157,329 | $129,132 | | EQUITY & LIABILITIES | | | | Total equity | $14,841 | $7,208 | | Total current liabilities | $42,663 | $19,523 | | Total non-current liabilities | $99,825 | $102,401 | | TOTAL EQUITY AND LIABILITIES | $157,329 | $129,132 | Unaudited Condensed Consolidated Statement of Cash Flows For the year ended December 31, 2024, net cash outflow from operating activities was $18.5 million, with a net cash inflow from financing activities of $44.6 million, largely from share issuance ($40.7 million) and new loan proceeds ($53.0 million) offset by repayments, driving a net increase in cash of $24.4 million, and the company ended the year with a cash balance of $46.8 million Statement of Cash Flows Summary (USD in thousands) | Cash Flow Activity | Year Ended Dec 31, 2024 | Year Ended Dec 31, 2023 | | :--- | :--- | :--- | | Net cash outflow from operating activities | $(18,530) | $(21,497) | | Net cash outflow from investing activities | $(1,636) | $(3,931) | | Net cash inflow from financing activities | $44,598 | $32,280 | | Net increase in cash and cash equivalents | $24,432 | $6,852 | | Cash and cash equivalents at end of year | $46,798 | $22,380 | Non-IFRS Measures Reconciliation This section provides a reconciliation of the IFRS net loss to the non-IFRS measure, Adjusted EBITDA, which management uses to evaluate core operating performance, with the full year 2024 IFRS net loss of $38.1 million adjusted for items such as amortization ($4.9 million), depreciation ($3.1 million), interest expense ($6.6 million), and fair value adjustments ($3.0 million) to arrive at an Adjusted EBITDA of ($14.7) million, a 24% improvement over the prior year - Adjusted EBITDA is defined as net loss adjusted for interest expense, depreciation and amortization, share-based compensation, fair-value adjustments, debt extinguishment costs, and other financial and non-cash expenses[17] Reconciliation of IFRS Net Loss to Adjusted EBITDA (USD in thousands) | Reconciliation Item | Q4 2024 | Q4 2023 | FY 2024 | FY 2023 | | :--- | :--- | :--- | :--- | :--- | | IFRS net loss | $(6,841) | $(10,720) | $(38,069) | $(43,100) | | Amortization of intangible assets | $1,330 | $1,127 | $4,905 | $4,494 | | Depreciation expense | $863 | $455 | $3,134 | $2,365 | | Share-based compensation expense | $666 | $208 | $1,725 | $665 | | Interest expense, net | $1,589 | $1,064 | $6,551 | $4,494 | | Other Adjustments | $967 | $3,594 | $6,700 | $11,700 | | Adjusted EBITDA | $(1,378) | $(4,371) | $(14,672) | $(19,382) |