DexCom, Inc. (Nasdaq:DXCM) today reported its unaudited financial results for the quarter ended September 30, 2008.
Product revenue grew to $1.9 million for the third quarter of 2008, an increase of 53% from the $1.2 million in product revenue reported for the third quarter of 2007. Total third quarter 2008 revenue, which included development grant revenue, was $1.9 million, an increase of 57% from the same quarter in 2007. The company reported a net loss of $14.7 million or $0.50 per share for the third quarter of 2008, up from $11.4 million or $0.40 per share for the third quarter of 2007. The net loss for the third quarter of 2008 included $2.7 million in non-cash expenses, centered primarily in share-based compensation.
Cost of sales totaled $3.8 million for the third quarter of 2008, compared to $3.1 million for the third quarter of 2007. The increase was due to additional product sales and development expenses relating to a development agreement entered into during the first quarter of 2008. Research and development expense increased by approximately $1.7 million to $5.4 million for the third quarter of 2008, compared to $3.7 million for the third quarter of 2007. Changes in research and development expense included higher consulting, facility, and supply costs. Selling, general and administrative expense increased by approximately $0.7 million to $6.7 million for the third quarter of 2008, compared to $5.9 million for the third quarter of 2007, with the change primarily due to additional general and administrative costs, including increased share-based compensation. As of September 30, 2008, the Company had $30.2 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 (888) 487-0359 (US/Canada) or (719) 325-2462 (International) and use the participant code "8557648" 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 people with diabetes.
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 reimbursement 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, 2008, as filed with the Securities and Exchange Commission on November 10, 2008.
DexCom, Inc. Consolidated Balance Sheets (In thousands—except par value data) (Unaudited) | |||||||
| September 30, 2008 | December 31, 2007 | ||||||
| Assets | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 4,642 | $ | 23,115 | |||
| Short-term marketable securities, available-for-sale | 20,741 | 41,208 | |||||
| Accounts receivable, net | 429 | 215 | |||||
| Inventory | 2,590 | 1,139 | |||||
| Prepaid and other current assets | 1,382 | 1,614 | |||||
| Total current assets | 29,784 | 67,291 | |||||
| Property and equipment, net | 6,442 | 6,649 | |||||
| Restricted cash | 4,839 | 914 | |||||
| Other assets | 2,010 | 2,405 | |||||
| Total assets | $ | 43,075 | $ | 77,259 | |||
| Liabilities and stockholders’ equity | |||||||
| Current liabilities: | |||||||
| Accounts payable and accrued liabilities | $ | 2,663 | $ | 4,535 | |||
| Accrued payroll and related expenses | 2,722 | 2,537 | |||||
| Current portion of long-term debt | 2,275 | 1,375 | |||||
| Current portion of deferred revenue | 167 | — | |||||
| Total current liabilities | 7,827 | 8,447 | |||||
| Long-term portion of deferred revenue | 212 | — | |||||
| Other liabilities | 679 | 666 | |||||
| Long-term debt, net of current portion | 61,650 | 61,031 | |||||
| Total liabilities | 70,368 | 70,144 | |||||
| Commitments and contingencies | |||||||
| Stockholders’ (deficit) equity: | |||||||
| Preferred stock, $0.001 par value, 5,000 shares authorized; no shares issued and outstanding at September 30, 2008 and December 31, 2007, respectively | — | — | |||||
| Common stock, $0.001 par value, 100,000 authorized; 30,067 and 29,788 issued and outstanding at September 30, 2008; 28,778 and 28,624 shares issued and outstanding at December 31, 2007 | 30 | 29 | |||||
| Additional paid-in capital | 190,744 | 183,325 | |||||
| Accumulated other comprehensive income (loss) | (81 | ) | 13 | ||||
| Accumulated deficit | (217,986 | ) | (176,252 | ) | |||
| Total stockholders’ (deficit) equity | (27,293 | ) | 7,115 | ||||
| Total liabilities and stockholders’ (deficit) equity | $ | 43,075 | $ | 77,259 | |||
DexCom Inc. Consolidated Statements of Operations (In thousands—except per share data) (Unaudited) | |||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||
| 2008 | 2007 | 2008 | 2007 | ||||||||||
Product revenue | $ | 1,878 | $ | 1,224 | $ | 5,643 | $ | 3,099 | |||||
| Development grant revenue | 42 | — | 122 | — | |||||||||
| Total revenue | 1,920 | 1,224 | 5,765 | 3,099 | |||||||||
| Product cost of sales | 3,577 | 3,113 | 9,833 | 9,081 | |||||||||
| Development cost of sales | 263 | — | 643 | — | |||||||||
| Total cost of sales | 3,840 | 3,113 | 10,476 | 9,081 | |||||||||
| Gross margin (deficit) | (1,920 | ) | (1,889 | ) | (4,711 | ) | (5,982 | ) | |||||
| Operating expenses | |||||||||||||
| Research and development | 5,418 | 3,671 | 15,058 | 11,734 | |||||||||
| Selling, general and administrative | 6,652 | 5,943 | 20,320 | 16,783 | |||||||||
| Total operating expenses | 12,070 | 9,614 | 35,378 | 28,517 | |||||||||
| Operating loss | (13,990 | ) | (11,503 | ) | (40,089 | ) | (34,499 | ) | |||||
| Interest income | 215 | 1,014 | 1,087 | 2,932 | |||||||||
| Interest expense | (913 | ) | (895 | ) | (2,732 | ) | (2,082 | ) | |||||
| Net loss | ($14,688 | ) | ($11,384 | ) | ($41,734 | ) | ($33,649 | ) | |||||
| Basic and diluted net loss per share | ($0.50 | ) | ($0.40 | ) | ($1.42 | ) | ($1.19 | ) | |||||
| Shares used to compute basic and diluted net loss per share | 29,627 | 28,325 | 29,415 | 28,283 | |||||||||
Contacts:
Jess Roper
Vice President and Chief Financial
Officer
(858) 200-0200
www.dexcom.com
