UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): March 12, 2019
STEREOTAXIS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
| 001-36159 | 94-3120386 | |
| (Commission File Number) | (IRS Employer Identification No.) |
| 4320 Forest Park Avenue, Suite 100, St. Louis, Missouri | 63108 | |
| (Address of Principal Executive Offices) | (Zip Code) |
(314) 678-6100
(Registrant’s Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[ ] 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))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item 2.02 Results of Operations and Financial Condition
On March 12, 2019, Stereotaxis, Inc. (the “Company”) issued a press release (the “Earnings Press Release”) setting forth its financial results for the 2018 fourth quarter and full year. A copy of the Earnings Press Release is being filed as Exhibit 99.1 hereto, and the statements contained therein are incorporated by reference herein.
Forward-Looking Statements and Additional Information
Statements are made herein or incorporated herein that are “forward-looking statements” as defined by the Securities and Exchange Commission (the “SEC”). All statements, other than statements of historical fact, included or incorporated herein that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are not guarantees of future events or the Company’s future performance and are subject to risks, uncertainties and other important factors that could cause events or the Company’s actual performance or achievements to be materially different than those projected by the Company. For a full discussion of these risks, uncertainties and factors, the Company encourages you to read its documents on file with the SEC. Except as required by law, the Company does not intend to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.
In accordance with General Instruction B.2. of Form 8-K, the information contained in Item 2.02 and Exhibit 99.1 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01 Financial Statements and Exhibits
| (d) | Exhibits. | |
| 99.1 | Stereotaxis, Inc. Earnings Press Release dated March 12, 2019. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| STEREOTAXIS, INC. | ||
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| Date: March 12, 2019 | By: | /s/ Martin C. Stammer |
| Name: | Martin C. Stammer | |
| Title: | Chief Financial Officer | |
Exhibit 99.1
 |
Stereotaxis Reports 2018 Full Year Financial Results
| ● | Record high annual recurring revenue of $27.8 million; 3% annual growth | |
| ● | Positive annual net income for the first time in Company history despite significantly increased R&D investments | |
| ● | Innovation initiatives to be showcased in May at Heart Rhythm Society meeting | |
| ● | Strong financial position to reach profitability without the need for additional financings | |
| ● | Conference call today at 10:00 a.m. Eastern Time |
ST. LOUIS, MO, March 12, 2019 – Stereotaxis, Inc. (OTCQX: STXS), the global leader in innovative robotic technologies for the treatment of cardiac arrhythmias, today reported financial results for the fourth quarter and full year ended December 31, 2018.
“2018 was an extremely active year at Stereotaxis with progress on multiple fronts,” said David Fischel, Chairman and CEO. “Our primary areas of focus have been advancing a robust innovation strategy and developing the commercial infrastructure to support improved performance. These have progressed well and have been accomplished while maintaining financial discipline.”
“We have made meaningful progress on our strategic innovation initiatives and look forward to showcasing our progress in the second quarter at the Heart Rhythm Society meeting. The collaborations announced over the past year reflect just a portion of the relationships we are building across the industry. We are confident that our innovation strategy is clinically and commercially sound, will provide significant benefits to patients, physicians and hospitals, and will substantially increase Stereotaxis’ opportunity.”
“We achieved record recurring revenue for the year while establishing the foundational commercial infrastructure crucial for ensuring the success of robotic electrophysiology practices. With this commercial infrastructure now in place we have begun more actively engaging with customers to help them showcase their clinical and technological leadership. We expect this to create the right environment for increased demand for robotics, and combined with specific innovation, to support a return to more robust system revenue.”
“We are proud that this fundamental progress was accomplished while maintaining financial discipline. Despite a significantly increased investment in R&D, the Company achieved a milestone of positive annual net income in 2018.”
2018 Fourth Quarter and Full Year Financial Results
Revenue for the fourth quarter of 2018 totaled $7.3 million. Recurring revenue for the quarter was $6.7 million and system revenue was $0.5 million. Revenue for the full year 2018 totaled $29.3 million. Recurring revenue for the full year 2018 of $27.8 million represents a 3% increase above the recurring revenue for the full year 2017. System revenue for the full year 2018 of $1.6 million declined from $4.3 million in 2017, primarily reflecting the impact from the shipment of two Niobe® Systems to an international distributor in 2017.
Gross margin for the fourth quarter and full year 2018 was approximately 80%. Operating expenses in the fourth quarter were $6.4 million, up from $5.9 million in the prior year quarter, predominantly driven by increased investment in R&D. Operating expenses for the full year 2018 totaled $26.1 million, down slightly from $26.3 million in 2017, with increased R&D investment offset by decreased general and administrative expenses. Operating loss and net loss in the fourth quarter were ($0.6) million. Operating loss and net income for the full year 2018 were ($2.5) million and $0.1 million, respectively. Negative free cash flow for the full year 2018 was ($2.8) million, compared to ($4.8) million for the full year 2017. The net income for 2018 represents the first full year of positive net income for the Company in its history.
Cash Balance and Liquidity
At December 31, 2018, Stereotaxis had cash and cash equivalents of $10.8 million, no debt, and $3.3 million in unused borrowing capacity on its revolving credit facility, for total net liquidity of $14.1 million.
Full Year 2019 Expectations
Stereotaxis enters 2019 with a solid plan for progress and a healthy financial foundation to execute on the plan. Stereotaxis expects its innovation initiatives to contribute to growth in systems revenue in 2019. Operating expenses are expected to moderately increase in 2019, primarily driven by increased R&D investment. Stereotaxis’ balance sheet will allow the Company to deliver on its commercial and innovation initiatives over the coming years and reach profitability without the need for additional financings.
Conference Call and Webcast
Stereotaxis will host a conference call and webcast today, March 12, 2019, at 10:00 a.m. Eastern Time. To access the conference call, dial 1-866-288-0540 (US and Canada) or 1-323-994-2131 (International) and give the participant pass code 5798362. Participants are asked to call 5-10 minutes prior to the start time. To access the live and replay webcast, please visit the investor relations section of the Stereotaxis website at www.stereotaxis.com.
About Stereotaxis
Stereotaxis is the global leader in innovative robotic technologies designed to enhance the treatment of arrhythmias and perform endovascular procedures. Its mission is the discovery, development and delivery of robotic systems, instruments, and information solutions for the interventional laboratory. These innovations help physicians provide unsurpassed patient care with robotic precision and safety, improved lab efficiency and productivity, and enhanced integration of procedural information. Over 100 issued patents support the Stereotaxis platform. The core components of Stereotaxis’ systems have received regulatory clearance in the United States, European Union, Japan, Canada, China, and elsewhere. For more information, please visit www.stereotaxis.com.
This press release includes statements that may constitute “forward-looking” statements, usually containing the words “believe”, “estimate”, “project”, “expect” or similar expressions. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, the Company’s ability to raise additional capital on a timely basis and on terms that are acceptable, its ability to continue to manage expenses and cash burn rate at sustainable levels, its ability to continue to work with lenders to extend, repay or refinance indebtedness, or to obtain additional financing, in either case on acceptable terms, continued acceptance of the Company’s products in the marketplace, the effect of global economic conditions on the ability and willingness of customers to purchase its systems and the timing of such purchases, competitive factors, changes resulting from healthcare reform in the United States, including changes in government reimbursement procedures, dependence upon third-party vendors, timing of regulatory approvals, and other risks discussed in the Company’s periodic and other filings with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release. There can be no assurance that the Company will recognize revenue related to its purchase orders and other commitments in any particular period or at all because some of these purchase orders and other commitments are subject to contingencies that are outside of the Company’s control. In addition, these orders and commitments may be revised, modified, delayed or canceled, either by their express terms, as a result of negotiations, or by overall project changes or delays.
Company Contacts:
David L. Fischel
Chairman and Chief Executive Officer
Martin C. Stammer
Chief Financial Officer
314-678-6100
investors@stereotaxis.com
STEREOTAXIS, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended December 31, | Twelve Months Ended December 31, | |||||||||||||||
| 2018 | 2017 | 2018 | 2017 | |||||||||||||
| Revenue: | ||||||||||||||||
| Systems | $ | 538,543 | $ | 630,927 | $ | 1,582,053 | $ | 4,275,798 | ||||||||
| Disposables, service and accessories | 6,729,561 | 6,924,740 | 27,764,564 | 26,868,302 | ||||||||||||
| Total revenue | 7,268,104 | 7,555,667 | 29,346,617 | 31,144,100 | ||||||||||||
| Cost of revenue: | ||||||||||||||||
| Systems | 530,679 | 4,169,883 | 1,788,658 | 6,199,643 | ||||||||||||
| Disposables, service and accessories | 898,646 | 1,204,116 | 3,928,521 | 4,554,596 | ||||||||||||
| Total cost of revenue | 1,429,325 | 5,373,999 | 5,717,179 | 10,754,239 | ||||||||||||
| Gross margin | 5,838,779 | 2,181,668 | 23,629,438 | 20,389,861 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development | 2,223,587 | 1,727,307 | 8,219,387 | 6,704,200 | ||||||||||||
| Sales and marketing | 3,054,404 | 3,148,096 | 12,965,920 | 13,627,724 | ||||||||||||
| General and administrative | 1,147,467 | 1,056,020 | 4,901,170 | 5,977,534 | ||||||||||||
| Total operating expenses | 6,425,458 | 5,931,423 | 26,086,477 | 26,309,458 | ||||||||||||
| Operating loss | (586,679 | ) | (3,749,755 | ) | (2,457,039 | ) | (5,919,597 | ) | ||||||||
| Other income | - | 1,241,510 | 2,590,361 | 212,031 | ||||||||||||
| Interest income (expense) | 16,705 | (44,509 | ) | (16,566 | ) | (179,844 | ) | |||||||||
| Net income (loss) | $ | (569,974 | ) | $ | (2,552,754 | ) | $ | 116,756 | $ | (5,887,410 | ) | |||||
| Cumulative dividend on convertible preferred stock | (361,447 | ) | (361,447 | ) | (1,434,000 | ) | (1,432,259 | ) | ||||||||
| Net loss attributable to common stockholders | $ | (931,421 | ) | $ | (2,914,201 | ) | $ | (1,317,244 | ) | $ | (7,319,669 | ) | ||||
| Net loss per share attributed to common stockholder: | ||||||||||||||||
| Basic | $ | (0.02 | ) | $ | (0.13 | ) | $ | (0.03 | ) | $ | (0.32 | ) | ||||
| Diluted | $ | (0.02 | ) | $ | (0.13 | ) | $ | (0.03 | ) | $ | (0.32 | ) | ||||
| Weighted average number of common shares and equivalents: | ||||||||||||||||
| Basic | 59,053,073 | 22,800,459 | 52,082,618 | 22,614,248 | ||||||||||||
| Diluted | 59,053,073 | 22,800,459 | 52,082,618 | 22,614,248 | ||||||||||||
Certain prior year amounts have been reclassified to conform to the 2018 presentation.
STEREOTAXIS, INC.
BALANCE SHEETS
| December 31, 2018 | December 31, 2017 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 10,796,072 | $ | 3,686,302 | ||||
| Accounts receivable, net of allowance of $398,847 and $361,350 in 2018 and 2017, respectively | 5,021,111 | 4,287,255 | ||||||
| Inventories, net | 1,191,666 | 1,146,971 | ||||||
| Prepaid expenses and other current assets | 963,700 | 750,085 | ||||||
| Total current assets | 17,972,549 | 9,870,613 | ||||||
| Property and equipment, net | 343,693 | 592,688 | ||||||
| Intangible assets, net | - | 159,470 | ||||||
| Other assets | 198,365 | 44,432 | ||||||
| Total assets | $ | 18,514,607 | $ | 10,667,203 | ||||
| Liabilities and stockholders’ equity (deficit) | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 1,726,360 | $ | 1,654,101 | ||||
| Accrued liabilities | 2,642,481 | 3,195,247 | ||||||
| Deferred revenue | 5,825,536 | 5,702,769 | ||||||
| Warrants | - | 19,574,977 | ||||||
| Total current liabilities | 10,194,377 | 30,127,094 | ||||||
| Long-term deferred revenue | 407,151 | 611,863 | ||||||
| Other liabilities | 641,461 | 535,369 | ||||||
| Total liabilities | 11,242,989 | 31,274,326 | ||||||
| Convertible preferred stock: | ||||||||
| Convertible preferred stock, par value $0.001; 10,000,000 shares authorized, 23,900 shares outstanding at 2018 and 2017 | 5,960,475 | 5,960,475 | ||||||
| Stockholders’ equity (deficit): | ||||||||
| Common stock, par value $0.001; 300,000,000 shares authorized, 59,058,297 and 22,805,731 shares issued at 2018 and 2017, respectively | 59,058 | 22,806 | ||||||
| Additional paid-in capital | 478,179,574 | 450,748,403 | ||||||
| Treasury stock, 4,015 shares at 2018 and 2017 | (205,999 | ) | (205,999 | ) | ||||
| Accumulated deficit | (476,721,490 | ) | (477,132,808 | ) | ||||
| Total stockholders’ equity (deficit) | 1,311,143 | (26,567,598 | ) | |||||
| Total liabilities and stockholders’ equity (deficit) | $ | 18,514,607 | $ | 10,667,203 | ||||