Microbot Medical(MBOT) - 2025 Q1 - Quarterly Report

Part I Financial Statements Microbot Medical Inc.'s unaudited interim financial statements as of March 31, 2025, show total assets increased to $30.9 million, a net loss of $2.6 million, and strong financing cash inflows of $27.8 million Interim Condensed Consolidated Balance Sheets As of March 31, 2025, total assets significantly increased to $30.9 million, driven by marketable securities, while shareholders' equity grew to $29.0 million due to capital raises Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2025 (Unaudited) | December 31, 2024 (Audited) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $3,217 | $3,114 | | Marketable securities | $27,173 | $2,356 | | Total current assets | $30,656 | $5,819 | | Total assets | $30,892 | $6,031 | | Liabilities & Equity | | | | Total current liabilities | $1,893 | $2,460 | | Total liabilities | $1,941 | $2,501 | | Total shareholders' equity | $28,951 | $3,530 | | Total liabilities and shareholders' equity | $30,892 | $6,031 | Interim Condensed Consolidated Statements of Comprehensive Loss For Q1 2025, the company reported a net loss of $2.6 million, an increase from $2.4 million in Q1 2024, primarily due to higher R&D and G&A expenses Statements of Comprehensive Loss (in thousands, except per share data) | Metric | Q1 2025 (Unaudited) | Q1 2024 (Unaudited) | | :--- | :--- | :--- | | Research and development, net | $(1,459) | $(1,169) | | General and administrative | $(1,562) | $(1,215) | | Operating loss | $(3,021) | $(2,384) | | Other income | $316 | $0 | | Net loss | $(2,601) | $(2,371) | | Basic and diluted net loss per share | $(0.08) | $(0.17) | | Weighted average common shares outstanding | 31,085,606 | 14,055,973 | Interim Condensed Consolidated Statements of Shareholders' Equity Shareholders' equity significantly increased to $29.0 million by March 31, 2025, primarily driven by $25.9 million from common stock and warrant issuances and $1.0 million from ATM offerings - In Q1 2025, the company issued 13,891,840 shares of common stock and warrants, raising $25.9 million net of issuance costs[15] - An additional 842,606 shares were issued under the at-the-market (ATM) offering program, generating $997,000 net of costs[15] - The exercise of 610,517 warrants brought in an additional $852,000[15] Interim Condensed Consolidated Statements of Cash Flows In Q1 2025, net cash used in operating activities was $2.9 million and investing activities $24.8 million, offset by $27.8 million from financing activities, resulting in a $102,000 increase in cash Statements of Cash Flows Highlights (in thousands) | Activity | Q1 2025 (Unaudited) | Q1 2024 (Unaudited) | | :--- | :--- | :--- | | Net cash flows used in operating activities | $(2,874) | $(2,420) | | Net cash flows used in investing activities | $(24,830) | $(1,284) | | Net cash flows provided by financing activities | $27,806 | $2,397 | | Increase (decrease) in cash, cash equivalents and restricted cash | $102 | $(1,307) | Notes to Interim Unaudited Condensed Consolidated Financial Statements The notes detail the company's pre-commercial status, sufficient funding for over twelve months, ongoing monitoring of geopolitical risks, grant obligations, and significant share capital activities - The company is a pre-commercial, clinical-stage medical device company focused on robotic endoluminal surgery devices[22] - Management has concluded that available funds are sufficient to fund operations for more than twelve months from the financial statement issuance date[26] - The company has received grants from the Israeli Innovation Authority (IIA) and is obligated to pay royalties of 3.0%-5% on future sales of related products[48][49] - In Q1 2025, the company raised approximately $28.6 million in gross proceeds through registered direct offerings and private placements[67][68][69] - Subsequent to the quarter end, in April and May 2025, the company raised an additional $2.56 million from the exercise of preferred investment options[85][86] Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's pre-commercial status, the LIBERTY system's FDA 510(k) submission, strengthened financial condition from $31.8 million in capital raises, and increased R&D and G&A expenses in Q1 2025 - The company is a pre-commercial, clinical-stage medical device company developing the LIBERTY Endovascular Robotic Surgical System, the first fully disposable robot for endovascular procedures[90][91] - A 510(k) premarket notification for the LIBERTY system was submitted to the FDA on December 10, 2024, with marketing clearance anticipated in Q2 2025[100][101] - The company raised approximately $31.8 million in gross proceeds since January 1, 2025, through various offerings and warrant exercises[126] - Management believes the company has sufficient funds for its operations for in excess of one year as of the filing date[128] Results of Operations In Q1 2025, R&D expenses increased by $290,000 and G&A expenses by $347,000, while other income of $316,000 was recognized from a litigation settlement Comparison of Results of Operations (in thousands) | Expense/Income | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Research and development expenses, net | $(1,459) | $(1,169) | $(290) | | General and administrative expenses | $(1,562) | $(1,215) | $(347) | | Other income | $316 | $0 | $316 | | Financing income, net | $104 | $13 | $91 | - The increase in R&D expenses was primarily due to an increase in payroll and manufacturing of the LIBERTY product[118] - The increase in G&A expenses was primarily due to increases in payroll, professional services, rent, and travel expenses[119] Liquidity and Capital Resources The company's net working capital significantly increased to $28.8 million by March 31, 2025, supported by approximately $31.8 million in gross proceeds from financing activities since January 1, 2025 - As of March 31, 2025, the company had net working capital of approximately $28.8 million[121] - Since January 1, 2025, the company has raised significant capital, including approximately $15.6 million and $13.0 million from institutional investors in January and February, respectively, and additional funds from ATM sales and warrant exercises[126] Summary of Net Cash Flow (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash flows used in operating activities | $(2,874) | $(2,420) | | Net cash flows used in investing activities | $(24,830) | $(1,284) | | Net cash flows provided by financing activities | $27,806 | $2,397 | Quantitative and Qualitative Disclosures About Market Risk The company's primary market risk is interest rate sensitivity on short-term instruments, with foreign exchange risk from non-USD operating expenses, while inflation has not significantly impacted operations - Primary market risk is interest income sensitivity on cash and marketable securities, but the short-term nature of these instruments mitigates this risk[131] - The company has foreign exchange risk as a significant portion of its operating expenses are in currencies other than the U.S. dollar[132] - Inflation is not considered to have had a significant impact on the company's results of operations[134] Controls and Procedures Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - Management concluded that as of March 31, 2025, the company's disclosure controls and procedures were effective[135] - No changes in internal control over financial reporting occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[136] Part II Legal Proceedings Information on legal proceedings is disclosed in Note 3G, detailing the favorable outcome of the Mona litigation, which resulted in the company receiving approximately $316,000 - For information on legal proceedings, the report refers to Note 3G of the financial statements[138] - Note 3G describes the Mona litigation, where an appellate court ruled in the company's favor, resulting in a judgment of approximately $316,000, which was recorded as other income[65] Risk Factors This section is not required for a smaller reporting company, and therefore no information is provided - Disclosure of risk factors is not required as the company is classified as a smaller reporting company[139] Unregistered Sales of Equity Securities and Use of Proceeds The company reported several unregistered sales of common stock from preferred investment option exercises, raising approximately $916,000 in January 2025, $2.3 million in April 2025, and $262,500 in May 2025 - In January 2025, the company issued 610,517 shares of common stock upon the exercise of Series E options, generating gross proceeds of approximately $916,000[140] - In April 2025, the company issued 1,533,336 shares upon exercise of Series E and F options, generating gross proceeds of approximately $2,300,000[141] - In May 2025, the company issued 175,000 shares upon exercise of Series F options, generating gross proceeds of approximately $262,500[142] Other Information During the first quarter of 2025, no director or officer of the company adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No director or officer adopted or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2025[145] Exhibits This section lists all exhibits filed with the Form 10-Q, including merger agreements, corporate governance documents, forms of warrants and investment options, securities purchase agreements, and officer certifications