DexCom, Inc. (Nasdaq: DXCM) today reported its unaudited financial results for the quarter ended September 30, 2009.
Product revenue grew to approximately $4.6 million for the third quarter of 2009, an increase of 146% from the $1.9 million in product revenue reported for the third quarter of 2008, and an increase of approximately 12% from the $4.1 million reported for the second quarter of 2009. Total third quarter 2009 revenue, which includes development grant revenue, was $7.3 million, an increase of approximately 278% from the same quarter in 2008, and approximately 8% from the second quarter of 2009. The Company reported a net loss of $13.5 million, down from $15.6 million for the third quarter of 2008. Net loss was $0.29 per share for the third quarter of 2009, down from a net loss of $0.53 per share for the third quarter of 2008. The net loss included $4.2 million in non-cash expenses during the third quarter of 2009, centered primarily in share-based compensation and expense of the convertible debt discount.
Product cost of sales increased $1.0 million to $4.6 million for the third quarter of 2009 compared to $3.6 million for the same quarter in 2008, primarily due to increased product sales. Total cost of sales was $6.4 million for the third quarter of 2009, compared to $3.8 million for the third quarter of 2008. The increase was due to additional product sales and development costs related to development and collaboration agreements entered into during 2008. Research and development expense decreased by approximately $1.9 million to $3.5 million for the third quarter of 2009, compared to $5.4 million for the third quarter of 2008. The decrease in research and development expense was due primarily to the allocation of expenses to development cost of sales for activities performed pursuant to development and collaboration agreements entered into in 2008. Selling, general and administrative expense increased by approximately $2.3 million to $8.9 million for the third quarter of 2009, compared to $6.7 million for the third quarter of 2008, with the change primarily due to additional marketing, customer service, insurance reimbursement and sales costs. As of September 30, 2009, the Company had $40.4 million in cash, marketable securities, and restricted cash.
Conference Call
Management will hold a conference call today starting at 4:30 pm (Eastern Time). The conference call will be concurrently webcast. The link to the webcast will be available on the DexCom, Inc. website at www.dexcom.com under the investor webcast section and will be archived for future reference. To listen to the conference call, please dial (800) 447-0521 (US/Canada) or 1 (847) 413-3238 (International) and use the participant code "25516624" approximately five minutes prior to the start time.
About DexCom, Inc.
DexCom, Inc., headquartered in San Diego, California, is developing and marketing continuous glucose monitoring systems for ambulatory use by patients and by healthcare providers in the hospital.
Cautionary Statement Regarding Forward Looking Statements
DexCom is a medical device company with a limited operating history. Successful commercialization and sale of the company’s products is subject to numerous risks and uncertainties, including product performance, a lack of acceptance in the marketplace by physicians and patients, the company’s inability to manufacture products in commercial quantities at an acceptable cost and quality level, possible delays in the company’s development programs, the inability of patients to receive reimbursements from third-party payors and inadequate financial and other resources. Certain of these risks and uncertainties, in addition to other risks, are more fully described in the company's quarterly report on Form 10-Q for the period ending September 30, 2009, as filed with the Securities and Exchange Commission on November 4, 2009.
DexCom, Inc. Balance Sheets (In thousands – except par value data) (Unaudited) | ||||||||
| September 30, 2009 | December 31, 2008 (1) | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 6,362 | $ | 12,700 | ||||
| Short-term marketable securities, available-for-sale | 31,356 | 14,368 | ||||||
| Accounts receivable, net | 2,487 | 1,118 | ||||||
| Inventory, net | 1,932 | 2,446 | ||||||
| Prepaid and other current assets | 1,239 | 1,426 | ||||||
| Total current assets | 43,376 | 32,058 | ||||||
| Property and equipment, net | 6,731 | 6,105 | ||||||
| Restricted cash | 2,639 | 4,270 | ||||||
| Other assets | 1,210 | 1,449 | ||||||
| Total assets | $ | 53,956 | $ | 43,882 | ||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 4,373 | $ | 4,599 | ||||
| Accrued payroll and related expenses | 3,560 | 2,115 | ||||||
| Current portion of long-term debt | 900 | 1,931 | ||||||
| Current portion of deferred revenue | 8,702 | 6,351 | ||||||
| Total current liabilities | 17,535 | 14,996 | ||||||
| Long-term portion of deferred revenue | — | 5,669 | ||||||
| Other liabilities | 839 | 889 | ||||||
| Long-term debt, net of current portion | 44,683 | 41,796 | ||||||
| Total liabilities | 63,057 | 63,350 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity (deficit): | ||||||||
| Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued and outstanding at September 30, 2009 and December 31, 2008, respectively | — | — | ||||||
| Common stock, $0.001 par value, 100,000 authorized; 46,307 and 46,027 issued and outstanding at September 30, 2009; 30,103 and 29,824 shares issued and outstanding at December 31, 2008 | 46 | 30 | ||||||
| Additional paid-in capital | 270,496 | 218,136 | ||||||
| Accumulated other comprehensive income | 36 | 50 | ||||||
| Accumulated deficit | (279,679 | ) | (237,684 | ) | ||||
| Total stockholders’ deficit | (9,101 | ) | (19,468 | ) | ||||
| Total liabilities and stockholders’ deficit | $ | 53,956 | $ | 43,882 | ||||
(1) The Consolidated Balance Sheet at December 31, 2008 has been derived from the audited consolidated financial statements as adjusted for the adoption on January 1, 2009 of authoritative guidance for accounting for convertible debt instruments that may be settled in cash upon conversion.
DexCom, Inc. Statements of Operations (In thousands – except per share data) (Unaudited) | ||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2009 | 2008 (1) | 2009 | 2008 (1) | |||||||||||||
| Product revenue | $ | 4,620 | $ | 1,878 | $ | 11,404 | $ | 5,643 | ||||||||
| Development grant revenue | 2,639 | 42 | 7,818 | 122 | ||||||||||||
| Total revenue | 7,259 | 1,920 | 19,222 | 5,765 | ||||||||||||
| Product cost of sales | 4,589 | 3,577 | 12,738 | 9,833 | ||||||||||||
| Development cost of sales | 1,805 | 263 | 6,930 | 643 | ||||||||||||
| Total cost of sales | 6,394 | 3,840 | 19,668 | 10,476 | ||||||||||||
| Gross margin (deficit) | 865 | (1,920 | ) | (446 | ) | (4,711 | ) | |||||||||
| Operating expenses | ||||||||||||||||
| Research and development | 3,496 | 5,418 | 10,122 | 15,058 | ||||||||||||
| Selling, general and administrative | 8,948 | 6,652 | 25,803 | 20,320 | ||||||||||||
| Total operating expenses | 12,444 | 12,070 | 35,925 | 35,378 | ||||||||||||
| Operating loss | (11,579 | ) | (13,990 | ) | (36,371 | ) | (40,089 | ) | ||||||||
| Interest and other income | 93 | 215 | 323 | 1,087 | ||||||||||||
| Interest expense | (2,037 | ) | (1,856 | ) | (5,947 | ) | (5,409 | ) | ||||||||
| Net loss | $ | (13,523 | ) | $ | (15,631 | ) | $ | (41,995 | ) | $ | (44,411 | ) | ||||
| Basic and diluted net loss per share | $ | (0.29 | ) | $ | (0.53 | ) | $ | (0.96 | ) | $ | (1.51 | ) | ||||
| Shares used to compute basic and diluted net loss per share | 45,919 | 29,627 | 43,797 | 29,415 | ||||||||||||
(1) The Consolidated Statements of Operations for the three and nine months ended September 30, 2008 have been derived from the audited consolidated financial statements as adjusted for the adoption on January 1, 2009 of authoritative guidance for accounting for convertible debt instruments that may be settled in cash upon conversion.
Contacts:
Steven R. Pacelli
Chief Administrative Officer
858-200-0200
www.dexcom.com
