|
||
(State or Other Jurisdiction of Incorporation)
|
(Commission File Number)
|
(I.R.S. Employer Identification No.)
|
|
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
Title of each class
|
Trading
Symbol(s)
|
Name of each exchange on which registered
|
|
|
|
Item 2.02. |
Results of Operations and Financial Condition.
|
Item 7.01. |
Regulation FD Disclosure.
|
Item 9.01. |
Financial Statements and Exhibits.
|
(d) |
Exhibits.
|
Press Release dated May 15, 2024 issued by STRATA Skin Sciences, Inc.
|
||
104
|
Cover Page Interactive Data File (embedded within the Inline XBRL document).
|
STRATA SKIN SCIENCES, INC.
|
|||
Date: May 15, 2024
|
By:
|
/s/ Christopher Lesovitz
|
|
Christopher Lesovitz
|
|||
Chief Financial Officer
|
• |
Revenue in the first quarter of 2024 was $6.8 million (-11% YOY) vs. $7.6 million in the first quarter of 2023
|
o |
Global net recurring revenue in the first quarter of 2024 was $4.7 million (-10% YOY) vs. $5.2 million in the first quarter of 2023, and was negatively impacted by deferred billings
|
o |
Gross domestic recurring billings were $4.6 million (-3% YOY) vs. $4.7 million in the first quarter of 2023; the 3% YOY decline in 1Q24 halted the trend of YOY double-digit declines seen in the prior
three quarters, evidence of early positive effects from STRATA’s new strategy
|
• |
Operating expenses in the first quarter of 2024 were $6.0 million (-14% YOY) vs. $7.0 million in the first quarter of 2023
|
• |
Domestic installed base of 907 XTRAC® devices under the Company’s recurring revenue business model at March 31, 2024 vs. 923 XTRAC® devices at December 31, 2023, as the Company
is starting to realign its assets and remove underperforming accounts
|
• |
Domestic installed base of 104 TheraClear®X devices under the Company’s recurring revenue business model at March 31, 2024 vs. 92 TheraClear®X devices at December 31, 2023
|
• |
Renewed 3-year agreements with exclusive distributors in China and Japan – each agreement carries minimum unit placements and/or purchases of the XTRAC® and VTRAC® devices
|
• |
Amended the credit agreement with MidCap Financial Trust to refinance existing debt and ensure alignment with the Company’s current and future business projections by supporting operational and
capital needs
|
• |
Initiated outreach initiative focused on broadening Current Procedural Terminology (“CPT”) code coverage to increase patient access to advanced treatments and enable higher provider reimbursement
rates
|
• |
Showcased TheraClear®X and XTRAC® products at Maui Derm 2024, highlighting the safety and efficacy from TheraClear®X in significantly reducing cystic and popular acne
lesions by over 50% within 1-2 weeks
|
Three Months Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Net loss
|
$
|
(3,368
|
)
|
$
|
(2,835
|
)
|
||
Adjustments:
|
||||||||
Depreciation and amortization
|
1,249
|
1,397
|
||||||
Amortization of operating lease right-of-use asset
|
95
|
105
|
||||||
Loss on disposal of property and equipment
|
13
|
—
|
||||||
Interest income
|
(45
|
)
|
(37
|
)
|
||||
Interest expense
|
524
|
286
|
||||||
Non-GAAP EBITDA
|
(1,532
|
)
|
(1,084
|
)
|
||||
Stock-based compensation
|
112
|
325
|
||||||
Inventory write-off
|
$
|
141
|
—
|
|||||
Non-GAAP adjusted EBITDA
|
$
|
(1,279
|
)
|
$
|
(759
|
)
|
Three Months Ended
March 31,
|
YTD
|
|||||||||||||||
2024
|
2023
|
2024
|
2023
|
|||||||||||||
Gross domestic recurring billings
|
$
|
4,578
|
$
|
4,735
|
$
|
4,578
|
$
|
4,735
|
||||||||
Co-Pay adjustments
|
(80
|
)
|
(83
|
)
|
(80
|
)
|
(83
|
)
|
||||||||
Other discounts
|
(30
|
)
|
(28
|
)
|
(30
|
)
|
(28
|
)
|
||||||||
Deferred revenue from prior quarters
|
1,624
|
2,170
|
1,624
|
2,170
|
||||||||||||
Deferral of revenue to future quarters
|
(1,901
|
)
|
(2,025
|
)
|
(1,901
|
)
|
(2,025
|
)
|
||||||||
GAAP Recorded domestic revenue
|
$
|
4,191
|
$
|
4,769
|
$
|
4,191
|
$
|
4,769
|
March 31, 2024
|
December 31, 2023
|
|||||||
(unaudited)
|
||||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
5,237
|
$
|
6,784
|
||||
Restricted cash
|
1,334
|
1,334
|
||||||
Accounts receivable, net of allowance for credit losses of $306 and
$222 at March 31, 2024 and December 31, 2023, respectively
|
3,630
|
4,440
|
||||||
Inventories
|
2,695
|
2,673
|
||||||
Prepaid expenses and other current assets
|
343
|
312
|
||||||
Total current assets
|
13,239
|
15,543
|
||||||
Property and equipment, net
|
11,726
|
11,778
|
||||||
Operating lease right-of-use assets
|
1,508
|
626
|
||||||
Intangible assets, net
|
6,825
|
7,319
|
||||||
Goodwill
|
6,519
|
6,519
|
||||||
Other assets
|
231
|
231
|
||||||
Total assets
|
$
|
40,048
|
$
|
42,016
|
||||
Liabilities and Stockholders’ Equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
3,592
|
$
|
3,343
|
||||
Accrued expenses and other current liabilities
|
6,269
|
6,306
|
||||||
Deferred revenues
|
2,366
|
2,120
|
||||||
Current portion of operating lease liabilities
|
300
|
352
|
||||||
Current portion of contingent consideration
|
61
|
53
|
||||||
Total current liabilities
|
12,588
|
12,174
|
||||||
Long-term debt, net
|
15,075
|
15,044
|
||||||
Deferred revenues and other liabilities
|
480
|
552
|
||||||
Deferred tax liability
|
186
|
186
|
||||||
Operating lease liabilities, net of current portion
|
1,166
|
237
|
||||||
Contingent consideration, net of current portion
|
1,121
|
1,135
|
||||||
Total liabilities
|
30,616
|
29,328
|
||||||
Commitments and contingencies
|
||||||||
Stockholders’ equity:
|
||||||||
Series C convertible preferred stock, $0.10 par value; 10,000,000 shares authorized, no shares
issued and outstanding
|
—
|
—
|
||||||
Common stock, $0.001 par value; 150,000,000 shares authorized;
35,060,920 shares issued and outstanding at March 31, 2024 and December 31, 2023
|
35
|
35
|
||||||
Additional paid-in capital
|
250,823
|
250,711
|
||||||
Accumulated deficit
|
(241,426
|
)
|
(238,058
|
)
|
||||
Total stockholders’ equity
|
9,432
|
12,688
|
||||||
Total liabilities and stockholders’ equity
|
$
|
40,048
|
$
|
42,016
|
Three Months Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Revenues, net
|
$
|
6,754
|
$
|
7,567
|
||||
Cost of revenues
|
3,674
|
3,179
|
||||||
Gross profit
|
3,080
|
4,388
|
||||||
Operating expenses:
|
||||||||
Engineering and product development
|
241
|
315
|
||||||
Selling and marketing
|
3,018
|
3,742
|
||||||
General and administrative
|
2,710
|
2,917
|
||||||
5,969
|
6,974
|
|||||||
Loss from operations
|
(2,889
|
)
|
(2,586
|
)
|
||||
Other (expense) income:
|
||||||||
Interest expense
|
(524
|
)
|
(286
|
)
|
||||
Interest income
|
45
|
37
|
||||||
(479
|
)
|
(249
|
)
|
|||||
Net loss
|
$
|
(3,368
|
)
|
$
|
(2,835
|
)
|
||
Net loss per share of common stock, basic and diluted
|
$
|
(0.10
|
)
|
$
|
(0.08
|
)
|
||
Weighted average shares of common stock outstanding, basic and diluted
|
35,060,920
|
34,862,092
|
Three Months Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Cash flows from operating activities:
|
||||||||
Net loss
|
$
|
(3,368
|
)
|
$
|
(2,835
|
)
|
||
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation and amortization
|
1,249
|
1,397
|
||||||
Amortization of operating lease right-of-use assets
|
95
|
105
|
||||||
Amortization of deferred financing costs and debt discount
|
31
|
41
|
||||||
Change in allowance for credit losses
|
84
|
(95
|
)
|
|||||
Stock-based compensation expense
|
112
|
325
|
||||||
Loss on disposal of property and equipment
|
13
|
—
|
||||||
Inventory write-off
|
141
|
—
|
||||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
726
|
626
|
||||||
Inventories
|
(154
|
)
|
283
|
|||||
Prepaid expenses and other assets
|
(31
|
)
|
16
|
|||||
Accounts payable
|
261
|
(326
|
)
|
|||||
Accrued expenses and other liabilities
|
(57
|
)
|
(12
|
)
|
||||
Deferred revenues
|
194
|
(247
|
)
|
|||||
Operating lease liabilities
|
(100
|
)
|
(95
|
)
|
||||
Net cash used in operating activities
|
(804
|
)
|
(817
|
)
|
||||
Cash flows from investing activities:
|
||||||||
Purchase of property and equipment
|
(725
|
)
|
(1,792
|
)
|
||||
Net cash used in investing activities
|
(725
|
)
|
(1,792
|
)
|
||||
Cash flows from financing activities:
|
||||||||
Payment of contingent consideration
|
(18
|
)
|
—
|
|||||
Net cash used in financing activities
|
(18
|
)
|
—
|
|||||
Net decrease in cash, cash equivalents and restricted cash
|
(1,547
|
)
|
(2,609
|
)
|
||||
Cash, cash equivalents and restricted cash at beginning of period
|
8,118
|
6,795
|
||||||
Cash, cash equivalents and restricted cash at end of period
|
$
|
6,571
|
$
|
4,186
|
||||
Cash and cash equivalents
|
$
|
5,237
|
$
|
2,825
|
||||
Restricted cash
|
1,334
|
1,361
|
||||||
$
|
6,571
|
$
|
4,186
|
|||||
Supplemental disclosure of cash flow information:
|
||||||||
Cash paid during the year for interest
|
$
|
480
|
$
|
241
|
||||
Supplemental schedule of non-cash operating, investing and financing activities:
|
||||||||
Operating lease right-of-use assets obtained in exchange for operating lease liabilities
|
$
|
977
|
$
|
—
|
||||
Transfer of property and equipment to inventories
|
$
|
9
|
$
|
45
|
||||
Accrued payment of contingent consideration
|
$
|
6
|
$
|
14
|