Invitae Reports 106% Annual Revenue Growth Driven by 95% Annual Growth in Volume in Third Quarter 2018
-- Raising annual volume and revenue guidance amid strong performance --
-- Q3 2018 gross profit of $16.9M up from nearly $5.0M in Q3 2017 --
-- Management hosting conference call and webcast today at 4:30pm Eastern/1:30pm Pacific --
PR Newswire
SAN FRANCISCO, Nov. 7, 2018
SAN FRANCISCO, Nov. 7, 2018 /PRNewswire/ -- Invitae Corporation (NYSE: NVTA), one of the fastest growing genetics companies, today announced financial and operating results for the third quarter ended September 30, 2018. Based on progress in the quarter, Invitae is raising its volume guidance from more than 275,000 samples to more than 285,000 samples and raising its revenue guidance from between $135 and $140 million to between $140 and $145 million in 2018.
"We have had another strong quarter of growth and execution, building momentum among our expanding base of customers," said Sean George, co-founder and chief executive officer of Invitae. "In addition to the volume and revenue growth, we achieved our goal of reducing cash burn by nearly 50% from the first quarter of this year. With access to more than $250 million in capital, we are well positioned to continue to grow the business as we emerge as a leading provider and partner of choice in genetics."
Third Quarter 2018 Results
- Accessioned approximately 78,000 samples in the third quarter of 2018, representing a 95% increase over the 40,000 samples in the third quarter of 2017
- Generated revenue of $37.4 million in the third quarter of 2018, representing a 106% increase over the third quarter of 2017 revenue of $18.1 million
- Reduced the average cost per sample to approximately $260 in the third quarter of 2018, representing a 21% reduction from an approximate $330 average cost per sample in the third quarter of 2017
- Achieved positive gross profit of $16.9 million in the third quarter of 2018 compared to nearly $5.0 million gross profit in the third quarter of 2017
Total operating expenses for the third quarter of 2018, excluding cost of goods sold, were $47.0 million compared to $35.9 million in the third quarter of 2017. For the third quarter of 2018, Invitae reported a net loss of $31.7 million, or a $0.45 loss per share, compared to a net loss of $27.4 million in the third quarter of 2017, or a $0.57 loss per share.
At September 30, 2018, cash, cash equivalents, restricted cash and marketable securities totaled $134.6 million. Net increase in cash, cash equivalents and restricted cash for the quarter was $52.6 million, with cash burn for the quarter at $18.4 million.
Corporate & Scientific Highlights
- Closed equity financing of $59.0 million in net proceeds in the quarter
- Subsequent to the quarter close, we entered into new financing arrangements for up to $200 million in debt and $5 million in equity from funds managed by Oberland Capital
- Notified of agreement to receive payments from Medicare for Lynch syndrome analysis (CPT code 81436)
- Continued growing our biopharma and patient advocacy network with the expansion of the company's partnership with Alnylam Pharmaceuticals to provide genetic testing at no cost to patients through the Alnylam Act® program for individuals who may carry gene mutations associated with primary hyperoxaluria, an ultra-rare genetic disorder affecting the kidneys that most often presents in childhood
- Presented findings at annual American Society of Human Genetics meeting, showing proactive genetic testing identifies medically significant findings for 16.5% of healthy individuals, adding to a growing body of evidence showing expanding clinical genetic testing to people without identified risks could be beneficial
- Announced the appointment of Chitra Nayak to the company's Board of Directors, noting her considerable track record of helping companies achieve transformational growth to scale and innovate globally
Webcast and Conference Call Details
Management will host a conference call and webcast today at 4:30 p.m. Eastern / 1:30 p.m. Pacific to discuss financial results and recent developments. The dial-in numbers for the conference call are (866) 393-4306 for domestic callers and (734) 385-2616 for international callers, and the reservation number for both is 9887569. Following prepared remarks, management will respond to questions from investors and analysts, subject to time limitations.
The live webcast of the call may be accessed by visiting the investors section of the company's website at ir.invitae.com. A replay of the webcast will be available shortly after the conclusion of the call and will be archived on the company's website.
About Invitae
Invitae Corporation (NYSE: NVTA) is a genetics company whose mission is to bring comprehensive genetic information into mainstream medicine to improve healthcare for billions of people. Invitae's goal is to aggregate most of the world's genetic tests into a single service with higher quality, faster turnaround time and lower prices.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements relating to the company's future financial performance and estimated guidance for 2018; and the company's belief that it is building momentum with its expanding base of customers, and that it is well positioned to continue to grow the business as it emerges as a leading provider and partner of choice in genetics. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, and reported results should not be considered as an indication of future performance. These risks and uncertainties include, but are not limited to: the company's actual 2018 results; the company's history of losses; the company's ability to compete; the company's failure to manage growth effectively; the company's need to scale its infrastructure in advance of demand for its tests and to increase demand for its tests; the risk that the company may not obtain or maintain sufficient levels of reimbursement for its tests; the company's failure to successfully integrate or fully realize the anticipated benefits of acquired businesses; the company's ability to use rapidly changing genetic data to interpret test results accurately and consistently; security breaches, loss of data and other disruptions; laws and regulations applicable to the company's business; and the other risks set forth in the company's filings with the Securities and Exchange Commission, including the risks set forth in the company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2018. These forward-looking statements speak only as of the date hereof, and Invitae Corporation disclaims any obligation to update these forward-looking statements.
Non-GAAP Financial Measures
To supplement Invitae's consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States (GAAP), the company monitors and considers cash burn, which is a non-GAAP financial measure. This non-GAAP financial measure is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similarly-titled measures presented by other companies. Cash burn excludes (1) changes in marketable securities other than investments made in privately held companies, (2) cash received from equity financings, (3) cash received from loan proceeds, and (4) cash received from exercises of acquisition-related warrants. Management believes cash burn is a liquidity measure that provides useful information to management and investors about the amount of cash consumed by the operations of the business. A limitation of using this non-GAAP measure is that cash burn does not represent the total change in cash, cash equivalents, and restricted cash for the period because it excludes cash provided by or used for other operating, investing or financing activities. Management accounts for this limitation by providing information about its operating, investing and financing activities in the statements of cash flows in its consolidated financial statements in its most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K and by presenting net cash provided by (used in) operating, investing and financing activities as well as the net increase in cash, cash equivalents and restricted cash in its reconciliation of cash burn. In addition, other companies, including companies in the same industry, may not use cash burn, may calculate cash burn in a different manner than management or may use other financial measures to evaluate their performance, all of which could reduce the usefulness of cash burn as a comparative measure.
Because of these limitations, cash burn should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of net increase in cash, cash equivalents and restricted cash to cash burn provided in the table below.
INVITAE CORPORATION | |||||||
Condensed Consolidated Statements of Operations | |||||||
(In thousands, except share and per share amounts) | |||||||
(Unaudited) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2018 | 2017 | 2018 | 2017 | ||||
Revenue: | |||||||
Test revenue | $ 36,611 | $ 17,310 | $ 100,014 | $ 40,597 | |||
Other revenue | 755 | 838 | 2,329 | 2,225 | |||
Total revenue | 37,366 | 18,148 | 102,343 | 42,822 | |||
Costs and operating expenses: | |||||||
Cost of test revenue | 20,441 | 13,274 | 58,964 | 33,093 | |||
Research and development | 15,776 | 11,502 | 46,926 | 32,864 | |||
Selling and marketing | 17,591 | 13,246 | 55,222 | 37,338 | |||
General and administrative | 13,668 | 11,102 | 37,884 | 25,915 | |||
Total costs and operating expenses | 67,476 | 49,124 | 198,996 | 129,210 | |||
Loss from operations | (30,110) | (30,976) | (96,653) | (86,388) | |||
Other income (expense), net | 231 | (56) | 2,066 | (596) | |||
Interest expense | (1,844) | (1,128) | (4,927) | (2,517) | |||
Net loss before taxes | (31,723) | (32,160) | (99,514) | (89,501) | |||
Income tax benefit | - | (4,758) | - | (6,614) | |||
Net loss | $ (31,723) | $ (27,402) | $ (99,514) | $ (82,887) | |||
Net loss per share, basic and diluted | $ (0.45) | $ (0.57) | $ (1.56) | $ (1.86) | |||
Shares used in computing net loss per share, basic and diluted | 70,152,804 | 48,221,896 | 63,935,336 | 44,639,416 | |||
INVITAE CORPORATION | |||
Condensed Consolidated Balance Sheets | |||
(In thousands) | |||
September 30, | December 31, | ||
2018 | 2017 | ||
(Unaudited) | |||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 101,419 | $ 12,053 | |
Marketable securities | 27,760 | 52,607 | |
Accounts receivable | 25,488 | 10,422 | |
Prepaid expenses and other current assets | 12,659 | 11,599 | |
Total current assets | 167,326 | 86,681 | |
Property and equipment, net | 29,287 | 30,341 | |
Restricted cash | 5,006 | 5,406 | |
Marketable securities, non-current | 367 | 5,983 | |
Intangible assets, net | 31,725 | 35,516 | |
Goodwill | 47,233 | 46,575 | |
Other assets | 3,456 | 576 | |
Total assets | $ 284,400 | $ 211,078 | |
Liabilities and stockholders' equity | |||
Current liabilities: | |||
Accounts payable | $ 8,044 | $ 8,606 | |
Accrued liabilities | 24,821 | 22,742 | |
Capital lease obligation, current portion | 1,857 | 2,039 | |
Debt, current portion | 8,135 | — | |
Total current liabilities | 42,857 | 33,387 | |
Capital lease obligation, net of current portion | 1,923 | 3,373 | |
Debt, net of current portion | 50,354 | 39,084 | |
Other long-term liabilities | 9,871 | 13,440 | |
Total liabilities | 105,005 | 89,284 | |
Stockholders' equity: | |||
Common stock | 7 | 5 | |
Accumulated other comprehensive loss | (46) | (171) | |
Additional paid-in capital | 666,305 | 520,558 | |
Accumulated deficit | (486,871) | (398,598) | |
Total stockholders' equity | 179,395 | 121,794 | |
Total liabilities and stockholders' equity | $ 284,400 | $ 211,078 | |
The condensed consolidated balance sheet at December 31, 2017 has been derived from the audited consolidated financial statements at that date included in the company's annual report on Form 10-K for the year ended December 31, 2017. |
INVITAE CORPORATION | |||
Condensed Consolidated Statements of Cash Flows | |||
(In thousands) | |||
(Unaudited) | |||
Nine Months Ended September 30, | |||
2018 | 2017 | ||
Cash flows from operating activities: | |||
Net loss | $ (99,514) | $ (82,887) | |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 10,268 | 5,876 | |
Stock-based compensation | 15,711 | 14,387 | |
Amortization of debt issuance costs | 681 | 326 | |
Amortization of premium on marketable securities | 9 | 108 | |
Impairment losses | 1,883 | — | |
Loss on disposal of assets | — | 268 | |
Loss on sales of available-for-sale securities | 24 | — | |
Remeasurements of liabilities associated with business combinations | 593 | 556 | |
Benefit from income taxes | — | (6,614) | |
Changes in operating assets and liabilities net of effects of business combination: | |||
Accounts receivable | (4,483) | (1,801) | |
Prepaid expenses and other current assets | (1,060) | 1,761 | |
Other assets | (555) | (45) | |
Accounts payable | (1,226) | 1,278 | |
Accrued expenses and other liabilities | 922 | 61 | |
Net cash used in operating activities | (76,747) | (66,726) | |
Cash flows from investing activities: | |||
Purchases of marketable securities | (1,575) | (94,563) | |
Proceeds from sales of marketable securities | 19,965 | — | |
Proceeds from maturities of marketable securities | 10,957 | 52,918 | |
Acquisition of businesses, acquired cash | — | 1,489 | |
Purchases of property and equipment | (4,258) | (4,115) | |
Other | (500) | — | |
Net cash provided by (used in) in investing activities | 24,589 | (44,271) | |
Cash flows from financing activities: | |||
Proceeds from public offerings of common stock, net of issuance costs | 112,480 | — | |
Proceeds from issuance of common stock | 10,732 | 71,687 | |
Proceeds from loan and security agreement | 19,544 | 39,661 | |
Loan payments | — | (30,457) | |
Capital lease principal payments | (1,632) | (2,153) | |
Net cash provided by financing activities | 141,124 | 78,738 | |
Net increase (decrease) in cash, cash equivalents and restricted cash | 88,966 | (32,259) | |
Cash, cash equivalents and restricted cash at beginning of period | 17,459 | 71,522 | |
Cash, cash equivalents and restricted cash at end of period | $ 106,425 | $ 39,263 | |
INVITAE CORPORATION | |||||
Reconciliation of Net Increase in Cash, Cash Equivalents and Restricted Cash to Cash Burn | |||||
(in thousands) | |||||
(Unaudited) | |||||
Three Months Ended | |||||
March 31, 2018 | June 30, 2018 | September 30, 2018 | |||
Net cash used in operating activities | $ (32,902) | $ (25,765) | $ (18,080) | ||
Net cash provided by (used in) investing activities | 19,947 | (1,888) | 6,530 | ||
Net cash provided by financing activities | 19,345 | 57,679 | 64,100 | ||
Net increase in cash, cash equivalents and restricted cash | 6,390 | 30,026 | 52,550 | ||
Adjustments: | |||||
Purchases of investments | (225) | (675) | (675) | ||
Sales of investments | (19,965) | - | - | ||
Maturities of investments | (2,078) | - | (8,879) | ||
Purchases of investments in privately held companies | 225 | 675 | 675 | ||
Proceeds from public offering of common stock, net of issuance costs | - | (53,480) | (59,000) | ||
Proceeds from loan and security agreement | (19,792) | 11 | 237 | ||
Proceeds from exercises of acquisition-related warrants | (191) | (3,083) | (3,277) | ||
Cash burn | $ (35,636) | $ (26,526) | $ (18,369) | ||
Contact:
Laura D'Angelo
ir@invitae.com
(628) 213-3369
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SOURCE Invitae Corporation
