SUWANEE, GA–(Marketwired – May 16, 2017) – SANUWAVE Health, Inc. (OTCQB: SNWV), today reported financial results for the three months ended March 31, 2017 and provided a business update. The Company will host a conference call at 9AM Eastern Time on Tuesday, May 16, 2017.
Highlights of the first quarter and recent weeks:
- The Company hired André Mouton to head the Company’s international sales and relations. André’s focus is on adding additional countries and regions to our portfolio and centralize the management of SANUWAVE’s existing distributor and customer base.
- SANUWAVE launched a blog entitled “SHOCK THIS” to bring together in one setting various information about the Company, the products and the science behind the technology in a useful and entertaining way. Two blogs have been published to date, with a third coming shortly. Please visit our website at www.sanuwave.com to view the blogs.
- SANUWAVE has appointed LOK North America to act as Territory Sales Manager for sourcing and screening of potential distributors for the Company’s products in Canada. LOK North America will give SANUWAVE an extended reach and establish rigorous evaluation methods of the regional distribution options in Canada to ensure the development of a strong distribution network.
- SANUWAVE exhibited, in conjunction with Ortho-Medico, a member of B&Co, at EWMA in Amsterdam, The Netherlands on May 3 -5, 2017.
“The first quarter came in as we had expected and announced on our most recent conference call. The weakness was due to economic concerns in South Korea. The good news is since the recent election in South Korea and a successful Korea Diabetic Conference, held in BEXCO from May 11th to 13th orders have returned and the outlook in South Korea for 2017 remains very robust. We also remain on track to add 3 new countries in the second quarter and 7-10 during the full year, as we had indicated on our year end conference call. Lastly, we have submitted our response to the FDA’s questions and are hopeful of a positive response by year end,” stated Kevin Richardson, CEO and Chairman.
First Quarter Financial Results
Revenues for the three months ended March 31, 2017 were $149,569, compared to $269,324 for the same period in 2016, a decrease of $119,755, or 44%. Revenues resulted primarily from sales in Europe, Asia and Asia/Pacific of our orthoPACE device and related applicators. The decrease in revenues for 2017 was due to lower sales of new orthoPACE devices and applicators, lower applicator refurbishments and lower wound kit sales in Europe and Asia/Pacific in 2017.
Research and development expenses for the three months ended March 31, 2017 were $260,338, compared to $309,955 for the same period in 2016, a decrease of $49,617, or 16%. Research and development expenses decreased in 2017 due to lower payments to consultants related to the de novo petition submission to the FDA in July 2016.
General and administrative expenses for the three months ended March 31, 2017 were $448,606, as compared to $499,132 for the same period in 2016, a decrease of $50,526, or 10%. The decrease in general and administrative expenses is primarily due to reduced salary and related costs due to reduction in headcount in June 2016, lower rent expense due to move to new facility and lower travel expenses.
Net loss for the three months ended March 31, 2017 was $493,532, or ($0.00) per basic and diluted share, compared to a net loss of $1,724,576, or ($0.02) per basic and diluted share, for the same period in 2016, a decrease in the net loss of $1,231,044, or 71%. The decrease in the net loss for 2017 was primarily due to a gain on warrant valuations and lower operating expenses as noted above.
Conference Call
The Company will also host a conference call on Tuesday, May 16, 2017, beginning at 9AM Eastern Time to discuss the first quarter financial results, provide a business update and answer questions. Shareholders and other interested parties can participate in the conference call by dialing 866-682-6100 (U.S.) or 862-255-5401 (international) or via webcast at http://www.investorcalendar.com/IC/CEPage.asp?ID=175965.
A replay of the conference call will be available beginning two hours after its completion through May 30, 2017, by dialing 877-481-4010 (U.S.) or 919-882-2331 (international) and entering Conference ID 10400.
About SANUWAVE Health, Inc.
SANUWAVE Health, Inc. (OTCQB: SNWV) (www.sanuwave.com) is a shock wave technology company initially focused on the development and commercialization of patented noninvasive, biological response activating devices for the repair and regeneration of skin, musculoskeletal tissue and vascular structures. SANUWAVE’s portfolio of regenerative medicine products and product candidates activate biologic signaling and angiogenic responses, producing new vascularization and microcirculatory improvement, which helps restore the body’s normal healing processes and regeneration. SANUWAVE applies its patented PACE technology in wound healing, orthopedic/spine, plastic/cosmetic and cardiac conditions. Its lead product candidate for the global wound care market, dermaPACE®, is CE Marked throughout Europe and has device license approval for the treatment of the skin and subcutaneous soft tissue in Canada, Australia and New Zealand. In the U.S., dermaPACE is currently under the FDA’s de novo petition review process for the treatment of diabetic foot ulcers. SANUWAVE researches, designs, manufactures, markets and services its products worldwide, and believes it has demonstrated that its technology is safe and effective in stimulating healing in chronic conditions of the foot (plantar fasciitis) and the elbow (lateral epicondylitis) through its U.S. Class III PMA approved OssaTron® device, as well as stimulating bone and chronic tendonitis regeneration in the musculoskeletal environment through the utilization of its OssaTron, Evotron® and orthoPACE® devices in Europe, Asia and Asia/Pacific. In addition, there are license/partnership opportunities for SANUWAVE’s shock wave technology for non-medical uses, including energy, water, food and industrial markets.
Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Forward-looking statements include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, its directors or its officers. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control. Actual results may differ materially from those projected in the forward-looking statements. Among the key risks, assumptions and factors that may affect operating results, performance and financial condition are risks associated with the regulatory approval and marketing of the Company’s product candidates and products, unproven pre-clinical and clinical development activities, regulatory oversight, the Company’s ability to manage its capital resource issues, competition, and the other factors discussed in detail in the Company’s periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statement.
For additional information about the Company, visit www.sanuwave.com.
| SANUWAVE HEALTH, INC. AND SUBSIDIARIES | |||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
| (UNAUDITED) | |||||||||
| March 31, | December 31, | ||||||||
| 2017 | 2016 | ||||||||
| ASSETS | |||||||||
| CURRENT ASSETS | |||||||||
| Cash and cash equivalents | $ | 97,538 | $ | 133,571 | |||||
| Accounts receivable, net of allowance for doubtful accounts | 451,369 | 460,799 | |||||||
| Inventory | 202,879 | 231,953 | |||||||
| Prepaid expenses | 115,377 | 87,823 | |||||||
| TOTAL CURRENT ASSETS | 867,163 | 914,146 | |||||||
| PROPERTY AND EQUIPMENT, at cost, less accumulated depreciation | 70,818 | 76,938 | |||||||
| OTHER ASSETS | 13,841 | 13,786 | |||||||
| TOTAL ASSETS | $ | 951,822 | $ | 1,004,870 | |||||
| LIABILITIES | |||||||||
| CURRENT LIABILITIES | |||||||||
| Accounts payable | $ | 1,033,341 | $ | 712,964 | |||||
| Accrued expenses | 546,829 | 375,088 | |||||||
| Accrued employee compensation | 64,860 | 64,860 | |||||||
| Interest payable, related parties | 246,264 | 109,426 | |||||||
| Short term loan, net | 100,000 | 47,440 | |||||||
| Warrant liability | 861,525 | 1,242,120 | |||||||
| Notes payable, related parties, net | 5,367,912 | 5,364,572 | |||||||
| TOTAL LIABILITIES | 8,220,731 | 7,916,470 | |||||||
| COMMITMENTS AND CONTINGENCIES | |||||||||
| STOCKHOLDERS’ DEFICIT | |||||||||
| PREFERRED STOCK, SERIES A CONVERTIBLE, par value $0.001, | |||||||||
| 6,175 authorized; 6,175 shares issued and 0 shares outstanding | |||||||||
| in 2017 and 2016 | – | – | |||||||
| PREFERRED STOCK, SERIES B CONVERTIBLE, par value $0.001, | |||||||||
| 293 authorized; 293 shares issued and 0 shares outstanding | |||||||||
| in 2017 and 2016, respectively | – | – | |||||||
| PREFERRED STOCK – UNDESIGNATED, par value $0.001, 4,993,532 | |||||||||
| shares authorized; no shares issued and outstanding | – | – | |||||||
| COMMON STOCK, par value $0.001, 350,000,000 shares authorized; | |||||||||
| 138,815,329 and 137,219,968 issued and outstanding in 2017 and | |||||||||
| 2016, respectively | 138,815 | 137,220 | |||||||
| ADDITIONAL PAID-IN CAPITAL | 92,569,540 | 92,436,697 | |||||||
| ACCUMULATED DEFICIT | (99,926,980 | ) | (99,433,448 | ) | |||||
| ACCUMULATED OTHER COMPREHENSIVE LOSS | (50,284 | ) | (52,069 | ) | |||||
| TOTAL STOCKHOLDERS’ DEFICIT | (7,268,909 | ) | (6,911,600 | ) | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT | $ | 951,822 | $ | 1,004,870 | |||||
| SANUWAVE HEALTH, INC. AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||||||||||
| (UNAUDITED) | ||||||||||
| Three Months Ended | Three Months Ended | |||||||||
| March 31, | March 31, | |||||||||
| 2017 | 2016 | |||||||||
| REVENUES | $ | 149,569 | $ | 269,324 | ||||||
| COST OF REVENUES (exclusive of depreciation and amortization shown below) | 55,144 | 73,181 | ||||||||
| OPERATING EXPENSES | ||||||||||
| Research and development | 260,338 | 309,955 | ||||||||
| General and administrative | 448,606 | 499,132 | ||||||||
| Depreciation | 6,120 | 836 | ||||||||
| Amortization | – | 76,689 | ||||||||
| Gain of sale of assets, property and equipment | – | (1,000 | ) | |||||||
| TOTAL OPERATING EXPENSES | 715,064 | 885,612 | ||||||||
| OPERATING LOSS | (620,639 | ) | (689,469 | ) | ||||||
| OTHER INCOME (EXPENSE) | ||||||||||
| Gain (loss) on warrant valuation adjustment and conversion | 323,223 | (797,697 | ) | |||||||
| Interest expense, net | (192,738 | ) | (234,430 | ) | ||||||
| Loss on foreign currency exchange | (3,378 | ) | (2,980 | ) | ||||||
| TOTAL OTHER INCOME (EXPENSE), NET | 127,107 | (1,035,107 | ) | |||||||
| NET LOSS | (493,532 | ) | (1,724,576 | ) | ||||||
| OTHER COMPREHENSIVE LOSS | ||||||||||
| Foreign currency translation adjustments | 1,785 | 2,972 | ||||||||
| TOTAL COMPREHENSIVE LOSS | $ | (491,747 | ) | $ | (1,721,604 | ) | ||||
| LOSS PER SHARE: | ||||||||||
| Net loss – basic and diluted | $ | 0.00 | $ | (0.02 | ) | |||||
| Weighted average shares outstanding – basic and diluted | 138,042,070 | 75,220,485 | ||||||||
| SANUWAVE HEALTH, INC. AND SUBSIDIARIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||
| (UNAUDITED) | |||||||||||
| Three Months Ended | Three Months Ended | ||||||||||
| March 31, | March 31, | ||||||||||
| 2017 | 2016 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||
| Net loss | $ | (493,532 | ) | $ | (1,724,576 | ) | |||||
| Adjustments to reconcile net loss to net cash used by operating activities to net cash used by operating activities | |||||||||||
| Depreciation | 6,120 | 836 | |||||||||
| Change in allowance for doubtful accounts | 5,152 | 1,052 | |||||||||
| Amortization | – | 76,689 | |||||||||
| Stock-based compensation – employees, directors and advisors | – | 4,500 | |||||||||
| (Gain) loss on warrant valuation adjustment | (323,223 | ) | 873,118 | ||||||||
| Amortization of debt discount | 55,900 | 5,694 | |||||||||
| Amortization of debt issuance costs | – | 74,549 | |||||||||
| Gain on sale of asset, property and equipment | – | (1,000 | ) | ||||||||
| Changes in assets – (increase)/decrease | |||||||||||
| Accounts receivable – trade | 4,278 | 27,370 | |||||||||
| Inventory | 29,074 | 26,413 | |||||||||
| Prepaid expenses | (27,554 | ) | (23,530 | ) | |||||||
| Other | (55 | ) | (94 | ) | |||||||
| Changes in liabilities – increase/(decrease) | |||||||||||
| Accounts payable | 320,377 | (153,022 | ) | ||||||||
| Accrued expenses | 171,741 | (107,371 | ) | ||||||||
| Accrued employee compensation | – | 44,613 | |||||||||
| Interest payable, related parties | 136,838 | (56,835 | ) | ||||||||
| Promissory notes, accrued interest | – | (79,948 | ) | ||||||||
| NET CASH USED BY OPERATING ACTIVITIES | (114,884 | ) | (1,011,542 | ) | |||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | |||||||||||
| Proceeds from sale of property and equipment | – | 1,000 | |||||||||
| NET CASH PROVIDED BY INVESTING ACTIVITIES | – | 1,000 | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | |||||||||||
| Proceeds from warrant exercise | 77,066 | – | |||||||||
| Proceeds from 2016 Public Offering, net | – | 1,352,775 | |||||||||
| Proceeds from convertible promissory notes, net | – | 106,000 | |||||||||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | 77,066 | 1,458,775 | |||||||||
| EFFECT OF EXCHANGE RATES ON CASH | 1,785 | 2,972 | |||||||||
| NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS | (36,033 | ) | 451,205 | ||||||||
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 133,571 | 152,930 | |||||||||
| CASH AND CASH EQUIVALENTS, END OF PERIOD | $ | 97,538 | $ | 604,135 | |||||||
| SUPPLEMENTAL INFORMATION | |||||||||||
| Cash paid for interest, related parties | $ | – | $ | 209,549 | |||||||
CONTACT INFORMATION
- Contact:
Millennium Park Capital LLC
Christopher Wynne
312-724-7845
cwynne@mparkcm.comSANUWAVE Health, Inc.
Kevin Richardson II
Chairman of the Board
978-922-2447
investorrelations@sanuwave.com
