BELGRADE, Mont., March 05, 2020 (GLOBE NEWSWIRE) — Xtant Medical Holdings, Inc. (NYSE American: XTNT), a global medical technology company focused on surgical solutions for the treatment of spinal disorders, today reported financial and operating results for the fourth quarter and year ended December 31, 2019.
Fourth Quarter 2019 Financial Highlights and Recent Announcements:
- Revenue for the fourth quarter of 2019 was $17.0 million, compared to $18.3 million for the same prior-year period.
- Operating expenses in the fourth quarter of 2019 were $11.6 million, compared to $62.0 million for the same prior-year period. Excluding non-cash impairment charges, operating expenses were $13.8 million in the fourth quarter of 2018.
- Net loss incurred in the fourth quarter of 2019 was $1.6 million, compared to a net loss of $56.7 million for the same prior-year period. Excluding non-cash impairment charges and inventory reserves, net loss in the fourth quarter of 2018 was $3.9 million.
- Non-GAAP Adjusted EBITDA for the fourth quarter of 2019 was $1.2 million, compared to $1.7 million for the same prior-year period.
Sean Browne, President and CEO of Xtant Medical, said, “I am very pleased with the commitment and contributions made by each of our team members. It is their commitment that allowed us to execute numerous strategic and operational initiatives during the year and to fulfill our mission of ‘Honoring the gift of donation, by helping our patients live as full, and complete a life as possible.’ I am looking forward to 2020 to see what the team can accomplish as we roll out exciting new products that will update some current product lines and expand our product offerings. We understand our future success is tied to our ability to expand the breadth and depth of our product offerings, and these new products are a step in the right direction for our patients, surgeons, distribution network partners, and the Company.”
Fourth Quarter and Full Year 2019 Financial Results
Fourth-quarter 2019 revenue was $17.0 million, compared to $18.3 million for the same period in 2018. Full-year 2019 revenue was $64.7 million, compared to $72.2 million for 2018. Fourth-quarter 2019 revenues benefitted from sales growth from the Company’s key biologics customers, which was offset by discontinued distributor arrangements related to the Company’s hardware business and lower demand for certain hardware products.
Gross profit for the fourth quarter of 2019 was 66.8%, compared to 39.7% for the same period in 2018 and was 65.7% for 2019, compared to 60.2% in 2018. In the fourth quarter of 2018, the Company increased its inventory reserve by $4.6 million, primarily due to excess inventory in the spinal implant product line. Excluding the inventory reserve adjustment, gross profit in 2018 would have been 65.1% for the fourth quarter, and 67.1% for the full year.
Operating expenses for the fourth quarter of 2019 were $11.6 million, compared to $62.0 million for the fourth quarter of 2018, and were $44.8 million in 2019 compared to $103.6 million in 2018. In the fourth quarter of 2018, the Company incurred non-cash impairment charges to goodwill and intangibles attributed to the X-spine acquisition totaling $48.1 million. Excluding the non-cash impairment charge, operating expenses were $13.8 million in the fourth quarter of 2018 and $55.4 million in 2018. These decreases in operating expenses were primarily attributable to lower sales commissions, reduced restructuring expenses, and a decrease in amortization expense as a result of the impairment of intangible assets that occurred in the fourth quarter of 2018, which were partially offset by higher general and administrative expenses.
Fourth-quarter 2019 net loss was $1.6 million, or $0.12 per share, compared to the fourth quarter 2018 net loss of $56.7 million, or $4.31 per share. Net loss for 2019 was $8.2 million, or $0.62 per share, compared to $70.1 million, or $5.97 per share, in 2018. Excluding the non-cash impairment charges and the inventory reserve charges, the net loss was $3.9 million, or $0.30 per share, in the fourth quarter of 2018, and $17.0 million, or $1.45 per share, in 2018.
Non-GAAP Adjusted EBITDA for the fourth quarter of 2019 was $1.2 million compared to $1.7 million for the same period of 2018. Non-GAAP Adjusted EBITDA for 2019 was $3.9 million, compared to $5.4 million for 2018. The Company defines non-GAAP Adjusted EBITDA as net income/loss from operations before depreciation, amortization, and interest expense, and as further adjusted to add back in or exclude, as applicable, impairment of goodwill and intangible assets, provision for losses on accounts receivable and inventory, stock-based compensation, changes in warrant derivative liability, remediation expenses, separation-related expenses, litigation reserves, facility consolidation costs, and restructuring expenses. A calculation and reconciliation of non-GAAP Adjusted EBITDA to net loss and the other non-GAAP financial measures included in this release to their respective most comparable GAAP measures can be found in the attached financial tables.
Xtant Medical will host a webcast and conference call to discuss the fourth quarter and full-year 2019 financial results on Thursday, March 5, 2020, at 9:00 AM ET. To access the webcast, Click Here. To access the conference call, dial 877-407-6184 within the U.S. or 201-389-0877 outside the U.S. A replay of the call will be available at www.xtantmedical.com, under “Investor Info.”