Accelerate Diagnostics(US:AXDX)2023-08-13 16:00Financial Performance - For the three and six months ended June 30, 2023, net sales decreased to $2,921,000, a 24% decline compared to $3,861,000 in the same period of 2022[248]. - Total revenues for the six months ended June 30, 2023, were $5,733,000, down 16% from $6,820,000 in the prior year[250]. - Gross profit for the three months ended June 30, 2023, was $799,000, a decrease of 26% compared to $1,080,000 for the same period in 2022[254]. - Gross margin for the three months ended June 30, 2023, was 27%, consistent with the same period in 2022, while the six-month gross margin increased to 32% from 28% in 2022 due to lower non-cash equity-based compensation[255]. - The company recorded a net loss of $49.5 million and negative cash flows from operations of $24.2 million for the six months ended June 30, 2023[270]. - The company's accumulated deficit totaled $656.8 million as of June 30, 2023[270]. Cost Management - Cost of sales for the three months ended June 30, 2023, was $2,122,000, a decrease of 24% from $2,781,000 in 2022[251]. - Non-cash equity-based compensation as a component of cost of sales decreased to $98,000 for the three months ended June 30, 2023, down 57% from $228,000 in 2022[252]. - Research and development expenses for the three months ended June 30, 2023, decreased by 23% to $5,820,000 from $7,576,000 in 2022, primarily due to reduced contracted service costs[257]. - Sales, general and administrative expenses for the three months ended June 30, 2023, decreased by 34% to $7,564,000 from $11,493,000 in 2022, mainly due to lower non-cash equity-based compensation[260]. Restructuring and Financial Strategy - The company entered into a restructuring support agreement on April 21, 2023, to negotiate the restructuring of its capital structure[271]. - The Company completed Restructuring Transactions on June 9, 2023, exchanging approximately $55.9 million of 2.50% Notes for $56.9 million of newly issued 5.00% Senior Secured Convertible Notes due 2026[272]. - The Company has a total contractual cash requirement of $97.2 million, with significant obligations including $67.6 million related to 5.00% Notes and $11.9 million in purchase obligations[281]. - The Company issued $66.9 million aggregate principal amount of 5.00% Notes in connection with the Restructuring Transactions, maturing on December 15, 2026[289]. - The Company exchanged $49.9 million of 2.50% Notes for a Secured Note of $34.9 million and a warrant for approximately 0.2 million shares at an exercise price of $21.2 per share[293]. Cash Flow and Liquidity - As of June 30, 2023, the Company had $30.7 million in cash and cash equivalents, a decrease of $14.9 million from $45.6 million at December 31, 2022, primarily due to cash used in operations[273]. - The Company reported net cash used in operating activities of $24.2 million for the six months ended June 30, 2023, compared to $25.6 million for the same period in 2022, reflecting a $1.4 million improvement[284]. - The net cash provided by financing activities was $9.7 million for the six months ended June 30, 2023, driven by proceeds from the issuance of common stock and 5.00% Notes[288]. - The Company has determined there is substantial doubt about its ability to continue as a going concern due to inadequate financial resources to fund forecasted operating costs for at least twelve months[278]. - The Company is actively exploring additional funding options, including equity and debt financing, but there is no assurance that necessary financing will be available[275]. Inventory and Product Development - The company continues to invest in new product development, focusing on enhancing existing products and developing a next-generation AST platform[245]. - The Accelerate Arc Products are currently on hold in the U.S. due to ongoing discussions with the FDA regarding their regulatory pathway[243]. - The company has sufficient inventory of Accelerate Pheno system instruments to mitigate the impact of rising costs on these devices[247]. - The Company has not taken material delivery of any inventory under a non-cancellable purchase obligation totaling $11.9 million, which must be fulfilled by March 15, 2027[281]. Other Financial Information - The Company has an available aggregate of $39.1 million for future sales under its at-the-market equity offering program[298]. - There were no off-balance sheet arrangements as of June 30, 2023[299]. - The Company’s financial statements are prepared in accordance with U.S. GAAP, requiring estimates and judgments affecting reported amounts[300].