Acutus Medical(US:AFIB)2022-08-12 21:54Financial Data and Key Metrics Changes - Net revenue for Q1 2022 was $3.7 million, a 3% increase from $3.6 million in Q1 2021 [20] - Non-GAAP net loss for Q1 2022 was $28.5 million or $1 per share, compared to a non-GAAP net loss of $27.2 million or $0.97 per share in Q1 2021 [24] - Total cash and cash equivalents at the end of Q1 2022 were $78.8 million [24] Business Line Data and Key Metrics Changes - Disposable revenue increased by 37% year-over-year to $3.2 million, driven by increased procedure volumes and adoption of AcQBlate therapy [21] - Capital equipment revenue was non-existent in Q1 2022, compared to $1 million in Q1 2021 [21] - Service and other revenue rose to $470,000 from $280,000 in Q1 2021, attributed to higher service contracts and console rentals [22] Market Data and Key Metrics Changes - U.S. sales grew by 28% to $2 million, while sales outside the U.S. decreased to $1.7 million from $2 million in Q1 2021, primarily due to a decline in capital revenue [20][21] - Mapping procedures increased by 27% year-over-year, achieving record global procedure volumes in Q1 2022 [21] Company Strategy and Development Direction - The company is focusing on enhancing its mapping platform and integrating therapy, particularly in the electrophysiology (EP) atrial fibrillation (AFib) market [9][10] - A strategic review is underway to maximize customer value, improve operational performance, and manage cash burn [9][10] - The sale of the left heart access portfolio to Medtronic is seen as a transformative step to focus on mapping and therapy solutions [19] Management's Comments on Operating Environment and Future Outlook - Management noted that COVID-related headwinds are moderating, allowing for a return to normal operations [38] - The company expects to see continued pressure on gross margins in 2022 but anticipates improvements in 2023 as operational efficiencies are realized [22][76] - The outlook for 2022 remains flat to slightly up compared to $17.3 million in revenue generated in 2021, with growth in procedure volumes expected to offset declines in capital [29] Other Important Information - The company completed a restructuring that included a reduction in force and is expected to see benefits reflected in Q2 2022 [17][23] - A definitive agreement to sell the left heart access portfolio includes a $50 million payment upon closing and additional contingent considerations [26][27] Q&A Session Summary Question: Revenue progression across capital and disposable over the next few quarters - Management expects capital sales to build throughout the year, with the largest contribution in Q4, while disposable revenue is expected to follow a seasonal pattern [31][33] Question: Impact of COVID on adoption and capital equipment sales - COVID had a significant impact on the business, but related headwinds are fading, allowing for a return to normal operations [36][38] Question: Cash position post-Medtronic agreement - Current cash outlook suggests the company will have cash until the end of 2024, with initiatives underway to extend this runway [40][41] Question: Approval timeline for AcQBlate in the U.S. - The company plans to file for PMA by mid-2022, with approval expected in early 2023 [42][43] Question: Changes to the commercial strategy - The commercial strategy is moving in the right direction, focusing on utilization and procedure volume growth [49][50] Question: Status of left heart access portfolio sales - There will be no disruption in product supply to customers during the transition to Medtronic [60] Question: Gross margin expectations for 2023 - Gross margins are expected to improve throughout 2022, with a break-even point at approximately $8 million in quarterly revenue [76]