Accelerate Diagnostics(US:AXDX)2024-05-10 21:41Financial Performance - For the three months ended March 31, 2024, net sales increased to $2,921,000, representing a 4% increase compared to $2,812,000 for the same period in 2023, primarily due to higher sales of Accelerate PhenoTest consumables[236]. - Cost of sales for the three months ended March 31, 2024, rose to $2,198,000, a 22% increase from $1,801,000 in the same period in 2023, driven by increased manufacturing costs and higher sales volume of consumables[237]. - Gross profit for the three months ended March 31, 2024, decreased to $723,000, down 28% from $1,011,000 in the same period in 2023, with a gross margin of 25% compared to 36% in 2023[239]. - Loss from operations improved to $(10,156,000) for the three months ended March 31, 2024, a reduction of 37% from $(16,062,000) in 2023[245]. - The company reported a net loss of $14.2 million and negative cash flows from operations of $8.5 million for the three months ended March 31, 2024[249]. Cash and Financing - As of March 31, 2024, the company had $15.8 million in cash and cash equivalents, an increase of $2.6 million from $13.2 million at December 31, 2023[252]. - The company completed an underwritten public offering in January 2024, generating net proceeds of $11.0 million[251]. - Net cash used in operating activities for the three months ended March 31, 2024, was $8.5 million, an improvement of $4.9 million compared to $13.4 million in the same period of 2023[266]. - Net cash provided by financing activities increased to $11.4 million in Q1 2024, compared to a net cash used of $0.1 million in Q1 2023, primarily due to proceeds from the sale and issuance of Units[266][269]. - The Company issued $66.9 million in 5.00% Notes in June 2023, which mature on December 15, 2026, and bear interest at 5.00% per annum, payable in kind[270]. - The January 2024 Public Units Offering generated gross proceeds of approximately $10.2 million, with an additional private placement raising about $2.0 million[281][282]. - The Schuler Trust has a forward contract to purchase an additional 1.6 million Units at a price of $1.73 per unit, expected to generate approximately $2.7 million in gross proceeds[283]. - The Company has a non-cancellable purchase obligation for raw materials totaling $11.9 million, with delivery required by March 15, 2027[261][264]. - As of March 31, 2024, approximately $0.7 million of 2.50% Notes remains outstanding and in default, accruing interest at 2.5% per annum[276]. - The Company plans to finance future cash requirements through equity offerings, debt financings, or collection of exclusivity fees from BD[264]. - The 5.00% Notes Indenture includes customary events of default, allowing for immediate payment upon certain conditions[271]. Operational Developments - The Accelerate Wave system, currently in development, aims to deliver antibiotic susceptibility testing results within 4.5 hours, significantly faster than traditional methods[232]. - The Accelerate Arc system and BC Kit were launched in 2022, with ongoing discussions with the FDA regarding commercialization in the U.S. as Class I devices exempt from 510(k) clearance requirements[228]. - A collaboration with Bruker Corporation was announced in November 2023 to validate the use of the Accelerate Arc system with Bruker's MALDI Biotyper system for microbial identification[231]. - The company anticipates significant workflow benefits for microbiology labs by offering consolidated testing for positive blood cultures and isolates with the Accelerate Wave system[233]. - The Accelerate Wave system is expected to have a lower production cost compared to the Accelerate PhenoTest BC Kit, potentially improving the company's margin profile[234]. - The company continues to invest in research and development to enhance existing products and develop new applications for the Accelerate Arc Products[231]. Financial Health and Concerns - The company has expressed the need to secure additional funds to continue operations and meet financial obligations, indicating insufficient financial resources for at least the next twelve months[218]. - The company has 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[259]. - The primary use of capital has been for the development and commercialization of the Accelerate Pheno® system and the next generation Accelerate Wave™ system[253]. - As of March 31, 2024, total cash requirements amount to $94.2 million, with significant obligations including $67.6 million in 5.00% Notes and $11.9 million in purchase obligations[261][276]. - The company's accumulated deficit totaled $683.1 million as of March 31, 2024[249]. Accounting and Reporting - The financial statements are prepared in accordance with U.S. GAAP, requiring estimates and assumptions that may affect reported amounts[285]. - There have been no material changes to critical accounting policies and estimates, except for the accounting of warrants issued in January 2024[285]. - As of March 31, 2024, the company reported no off-balance sheet arrangements[284].