BIOLASE, Inc. (NASDAQ: BIOL), the global leader in dental lasers, today announced its financial results for the fourth quarter and full year ended December 31, 2022
LAKE FOREST, Calif., March 28, 2023 /PRNewswire/ -- BIOLASE, Inc. (NASDAQ: BIOL), the global leader in dental lasers, today announced its financial results for the fourth quarter and full year ended December 31, 2022.
2022 Full-Year Financial Highlights
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Achieved year-over-year revenue growth of 24% to $48.5 million
Increased U.S. laser sales by 39% year over year
Achieved record U.S. consumable sales, up 25% year over year, driven by increased procedures using BIOLASE lasers
Generated increased adoption of its industry-leading laser, with approximately 84% of U.S. Waterlase sales for the full-year 2022 coming from new customers
Sales conversion rate continued to rise throughout the year due to the success of its Waterlase Exclusive Trial Program
"The rising demand for our industry-leading lasers, which is being driven by the execution of our growth strategy, enabled us to achieve our business objectives for 2022 while positioning us for continued success in 2023," commented John Beaver, President and Chief Executive Officer. "We reported revenue growth of 24% year over year, primarily from U.S. laser sales increasing 39% year over year and U.S. consumable sales growing 25% year over year. Our strong performance is being driven by the market's positive reaction to the Waterlase Exclusive Trial Program and the team's sales conversion rate of nearly 50%. This initiative, along with the emphasis on education and training for endodontists, periodontists, pediatric dentists, and dental hygienists, generated increased adoption of our laser technology in the U.S., with approximately 84% of our U.S. Waterlase sales in the year coming from new customers.
"We expect much of the same in 2023 as we currently anticipate total revenue growth of at least 25%. Moreover, we expect our gross margins to improve significantly in 2023 due to increased sales volume and pricing increases, lower trunk fiber costs resulting from our recent acquisition, and other manufacturing cost savings. We believe all of this positions us to achieve positive adjusted EBITDA for the full year of 2023.
"Our results and future expectations clearly demonstrate that we are moving the needle, and with less than 10% of the U.S. dental community currently using dental lasers, we are confident we can leverage the enhanced capabilities of our product and our successful sales and marketing initiatives, to drive further adoption and become the new standard of care."
Net revenue for the year ended December 31, 2022, was $48.5 million, an increase of 24% compared to net revenue of $39.2 million for the year ended December 31, 2021. U.S. laser revenue was $20.4 million for the year ended December 31, 2022, an increase of 39% compared to U.S. laser revenue of $14.8 million for the year ended December 31, 2021. U.S. consumables and other revenue for the year ended December 31, 2022, which consists of revenue from consumable products such as disposable tips, increased 25% year over year. International laser revenue was $11.0 million for the year ended December 31, 2022, compared to $10.3 million for the year ended December 31, 2021.
Gross margin for the year ended December 31, 2022, was 33% compared to 42% for the year ended December 31, 2021. Total operating expenses were $41.2 million for the year ended December 31, 2022, compared to $33.0 million for the year ended December 31, 2021, a 25% increase year over year. Operating loss for the year ended December 31, 2022, was $25.3 million, compared to an operating loss of $16.4 million for the year ended December 31, 2021, an increase of 54% year over year.
The Company had cash and cash equivalents of approximately $4.2 million on December 31, 2022. Following its January 2023 equity raise of an additional $9.0 million in net proceeds, the Company believes it has sufficient liquidity to execute its near-term growth strategies and greatly improve profitability.
Net Loss and Adjusted EBITDA
The reconciliation of GAAP Net Loss to Adjusted EBITDA at the end of this news release provides the details of the Company's non-GAAP disclosures and the reconciliation of GAAP net loss and net loss per share to the Company's Adjusted EBITDA and Adjusted EBITDA per share.
Net loss attributable to common stockholders for the year ended December 31, 2022, was $28.9 million, or $4.16 per share, compared to a net loss of $16.7 million, or $2.83 per share, for the year ended December 31, 2021. Adjusted EBITDA for the year ended December 31, 2022, was a loss of $20.1 million, or $2.91 per share, compared with an Adjusted EBITDA loss of $14.7 million, or $2.49 per share, for the year ended December 31, 2021.
2023 First Quarter and Full Year Financial Guidance
BIOLASE is anticipating first-quarter net revenue to exceed $10.0 million, representing relatively flat revenue compared to the year-ago quarter. The Company expects 2023 full-year net revenue to increase at least 25% year over year and expects to achieve positive adjusted EBITDA results for the full year of 2023 (adjusted EBITDA is defined as net loss before interest, taxes, depreciation and amortization, patent litigation settlements, stock-based and other non-cash compensation, and the change in allowance for doubtful accounts).
Conference Call Information
BIOLASE, Inc. will host a conference call today at 4:30 p.m. Eastern Time to discuss its operating results for the fourth quarter and full year ended December 31, 2022, and to answer questions. To access the live call, dial 1-888-506-0062 (U.S.) or +1 973-528-0011 (International) and provide the following code: 121864.
A live and archived webcast of the conference call will be accessible on the BIOLASE Investor Relations page. In addition, a phone replay will be available approximately two hours following the end of the call, and it will remain available for one week. To access the call replay dial 1-877-481-4010 or +1 919-882-2331 (International) and enter replay passcode: 47764.
BIOLASE is a medical device company that develops, manufactures, markets, and sells laser systems in dentistry and medicine. BIOLASE's products advance the practice of dentistry and medicine for patients and healthcare professionals. BIOLASE's proprietary laser products incorporate approximately 259 actively patented and 24 patent-pending technologies designed to provide biologically and clinically superior performance with less pain and faster recovery times. BIOLASE's innovative products provide cutting-edge technology at competitive prices to deliver superior results for dentists and patients. BIOLASE's principal products are dental laser systems that perform a broad range of dental procedures, including cosmetic and complex surgical applications. From 1998 through December 31, 2022, BIOLASE has sold over 45,500 laser systems in over 80 countries around the world. Laser products under development address BIOLASE's core dental market and other adjacent medical and consumer applications.
BIOLASE®, Waterlase® and Waterlase iPlus® are registered trademarks of BIOLASE, Inc.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties, including statements, regarding BIOLASE's expected revenue and revenue growth. Forward-looking statements can be identified through the use of words such as "may," "might," "will," "intend," "should," "could," "can," "would," "continue," "expect," "believe," "anticipate," "estimate," "predict," "outlook," "potential," "plan," "seek," and similar expressions and variations or the negatives of these terms or other comparable terminology. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect BIOLASE's current expectations and speak only as of the date of this release. Actual results may differ materially from BIOLASE's current expectations depending upon a number of factors. These factors include, among others, the coronavirus (COVID-19) and the effects of the outbreak and actions taken in connection therewith, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business, substantial doubt regarding BIOLASE's ability to continue as a going concern, and those other risks and uncertainties that are described in the "Risk Factors" section of BIOLASE's most recent annual report on Form 10-K and quarterly report on Form 10-Q filed with the Securities and Exchange Commission. Except as required by law, BIOLASE does not undertake any responsibility to revise or update any forward-looking statements.
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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(Unaudited, in thousands, except per share data)
General and administrative
Engineering and development
Loss on patent litigation settlement
Gain (Loss) on foreign currency transactions
Non-operating gain (loss), net
Loss before income tax provision
Deemed dividend on convertible preferred stock
Net loss attributable to common stockholders
Net loss per share attributable to common stockholders:
Shares used in the calculation of net loss per share:
CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except per share data)
Cash and cash equivalents
Accounts receivable, less allowance of $2,164 and $2,154 as of December 31, 2022 and 2021, respectively
Prepaid expenses and other current assets
Property, plant, and equipment, net
LIABILITIES AND STOCKHOLDERS' EQUITY
Deferred revenue, current portion
Term loan, net of discount
Total current liabilities
Non current term loans, net of discount
Non current operating lease liability
Series F Preferred stock, par value $0.001 per share
Common stock, par value $0.001 per share
Additional paid-in capital
Accumulated other comprehensive loss
Total stockholders' equity
Total liabilities and stockholders' equity
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)
Cash Flows from Operating Activities:
Adjustments to reconcile net loss to net cash and cash equivalents
used in operating activities:
Depreciation and amortization
Provision for inventory excess and obsolescence
Inventory disposals and recoveries, net
Amortization of debt issuance costs
Patent litigation mark-to-market
Issuance of restricted shares
Changes in operating assets and liabilities:
Prepaid expenses and other current assets
Accounts payable and accrued liabilities
Net cash and cash equivalents used in operating activities
Cash Flows from Investing Activities:
Purchases of property, plant, and equipment
Net cash and cash equivalents used in investing activities
Cash Flows from Financing Activities:
Proceeds from the issuance of common stock and June 2020 Warrants, net
Payments of equity offering costs
Principal payment on term loan
Payments of debt issuance costs
Proceeds from the exercise of common stock warrants
Proceeds from exercise of stock options
Net cash and cash equivalents provided by financing activities
Effect of exchange rate changes
Increase (decrease) in cash and cash equivalents
Cash, cash equivalents and restricted cash, beginning of year
Cash, cash equivalents and restricted cash, end of year
Supplemental cash flow disclosure:
Cash received for interest
Cash paid for income taxes
Cash paid for operating leases
Non-cash settlement of liability
Non-cash right-of-use assets obtained in exchange for lease obligations
Deemed dividend on preferred stock
Receivable from warrants exercised and included in prepaid and other current assets
Non-GAAP Financial Measures
In addition to the financial information prepared in conformity with generally accepted accounting principles in the U.S. ("GAAP"), this press release includes certain historical non-GAAP financial information. Management believes that these non-GAAP financial measures assist investors in making comparisons of period-to-period operating results and that, in some respects, these non-GAAP financial measures are more indicative of the Company's ongoing core operating performance than their GAAP equivalents.
Adjusted EBITDA is defined as net income (loss) before interest, taxes, depreciation and amortization, loss on patent litigation settlement, stock-based and other non-cash compensation, allowance for doubtful accounts, increase in inventory reserves, and gain on debt forgiveness. Management uses Adjusted EBITDA in its evaluation of the Company's core results of operations and trends between fiscal periods and believes that these measures are important components of its internal performance measurement process. Therefore, investors should consider non-GAAP financial measures in addition to, and not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. Further, the non-GAAP financial measures presented by the Company may be different from similarly named non-GAAP financial measures used by other companies.
Reconciliation of GAAP Net Loss to Adjusted EBITDA and
GAAP Net Loss Per Share to Adjusted EBITDA Per Share
(Unaudited, in thousands, except per share data)
GAAP net loss attributable to common stockholders
Deemed dividend on convertible preferred stock
Depreciation and amortization
Change in allowance for doubtful accounts
Loss on patent litigation settlement
Stock-based and other non-cash compensation
Increase in inventory reserve and disposals
GAAP net loss attributable to common stockholders
per share, basic and diluted
Deemed dividend on convertible preferred stock
GAAP net loss per share, basic and diluted
Depreciation and amortization
Change in allowance for doubtful accounts
Loss on patent litigation settlement
Stock-based and other non-cash compensation
Increase in inventory reserve and disposals
Adjusted EBITDA per share, basic and diluted
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