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NxStage Reports First Quarter 2013 Financial Results



             NxStage Reports First Quarter 2013 Financial Results

Highlights:

- Revenue Increases to $61.6 million, up 8% from Q1'12

- Home Revenue Increases to $31.5 million, up 6% from Q1'12

- Gross Margin Increases to 39%, up from 37% in Q1'12

- Company Announces FDA Clearance of High Flow Capabilities with System One™

- Company Reaffirms Full-Year Outlook for 2013

PR Newswire

LAWRENCE, Mass., May 2, 2013

LAWRENCE, Mass., May 2, 2013 /PRNewswire/ -- NxStage^® Medical, Inc. (Nasdaq:
NXTM), a leading manufacturer of innovative dialysis products, today reported
first quarter financial results with revenue at the upper end of its guidance
range.

(Logo:  http://photos.prnewswire.com/prnh/20110503/MM94799LOGO )

Revenue for the first quarter of 2013 increased 8% to $61.6 million, compared
with revenue of $57.0 million for the first quarter of 2012.  The higher
revenues were driven by increased adoption of the NxStage System One™.

Home revenue for the first quarter of 2013 increased 6% to $31.5 million
compared with revenue of $29.6 million for the first quarter of 2012.  These
results, which reflect the Company's transition to a direct sales operation
from a distribution relationship in the United Kingdom, were in-line with the
Company's guidance.

Critical Care revenue increased to $10.7 million for the first quarter of 2013
compared with revenue of $9.8 million for the first quarter of 2012. 
In-center revenue increased to $18.7 million for the first quarter of 2013
compared with revenue of $17.6 million for the first quarter of 2012. 

NxStage reported a net loss of $5.0 million or $(0.08) per share for the first
quarter of 2013 compared with a net loss of $5.1 million or $(0.09) per share
for the first quarter of 2012.  The Company's first quarter net loss reflects
increased investments in new products and market development efforts to
accelerate future revenue growth.

"Our first quarter performance represents a good start to the year," stated
Jeffrey H. Burbank, Founder and Chief Executive Officer of NxStage.  "In
addition to meeting our near-term financial objectives, we're on track with
strong and systematic execution against initiatives that are focused on
accelerating growth over the long term.  Our recent regulatory successes which
include approval for a number of significant product innovations, including CE
mark for nocturnal home dialysis and both CE mark and FDA clearance for our
new high flow capabilities with our System One, reinforce our confidence in
our ability to reduce barriers to home adoption and drive demand for our
therapy."

Burbank continued, "Based on our outlook and our continuing progress in key
areas, we are reaffirming both our guidance for 2013, and our belief that we
are creating significant catalysts for adoption of NxStage therapies in 2014
and beyond."

Guidance:

For the second quarter of 2013, the Company is forecasting revenues to be
between $64.0 million and $65.5 million, a net loss in the range of $4.0
million to $5.0 million, or $(0.07) to $(0.08) per share.  The Company
reaffirmed its full year guidance for 2013.

Conference Call:

NxStage will also host a conference call today, Thursday, May 2, 2013 at 9:00
a.m. Eastern Time to discuss its first quarter financial results. To listen to
the conference call, please dial 877-392-9886 (domestic) or 707-287-9329
(international).  The call will also be webcast LIVE and can be accessed via
the investor relations section of the Company's website at www.nxstage.com.

A replay of the conference call will be available 2 hours after the completion
of the call through May 9, 2013.  To access the replay dial 855-859-2056
(domestic) or 404-537-3406 (international) and reference conference ID
34519800.  An online archive of the conference call can be accessed via the
investor relations section of the Company's website at www.nxstage.com.

About NxStage

NxStage Medical, Inc. (Nasdaq: NXTM) is a medical device company,
headquartered in Lawrence, Massachusetts, USA, that develops, manufactures and
markets innovative products for the treatment of ESRD and acute kidney
failure. For more information on NxStage and its products, please visit the
company's website at www.nxstage.com.

Forward-Looking Statements

This release contains "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. All statements contained in
this release that are not clearly historical in nature are forward-looking,
and the words "anticipate," "believe," "expect," "estimate," "plan," and
similar expressions are generally intended to identify forward-looking
statements. Examples of these forward-looking statements include statements as
to the anticipated demand for the Company's products, anticipated operating
results, including revenues, loss, gross margin and Adjusted EBITDA numbers,
and other expectations as to future operating results. All forward-looking
statements involve risks, uncertainties and contingencies, many of which are
beyond NxStage's control, which may cause actual results, performance, or
achievements to differ materially from anticipated results, performance or
achievements, including market acceptance and demand for NxStage's products,
growth in home and/or daily hemodialysis, unanticipated difficulties in
achieving operational efficiencies and cost reductions, changes in
reimbursement for home and daily hemodialysis, changes in the regulatory
environment, changes in the historical purchasing patterns and preferences of
our customers, including DaVita Healthcare Partners Inc. and Fresenius Medical
Care, and certain other factors that may affect future operating results and
which are detailed in NxStage's filings with the Securities and Exchange
Commission, including its Annual Report on Form 10-K for the year ended
December 31, 2012.

In addition, the statements in this press release represent NxStage's
expectations and beliefs as of the date of this press release. NxStage
anticipates that subsequent events and developments may cause these
expectations and beliefs to change. However, while NxStage may elect to update
these forward-looking statements at some point in the future, it specifically
disclaims any obligation to do so, whether as a result of new information,
future events, or otherwise. These forward-looking statements should not be
relied upon as representing NxStage's expectations or beliefs as of any date
subsequent to the date of this press release.

Contact:
Kristen K. Sheppard, Esq.
VP, Investor Relations
ksheppard@nxstage.com

Non-GAAP Financial Measure

The Company discloses a certain non-GAAP financial measure to supplement the
Company's consolidated financial statements presented on a GAAP basis. This
non-GAAP measure is not in accordance with, or an alternative for, generally
accepted accounting principles in the United States and may be different from
similar non-GAAP financial measures used by other companies. The non-GAAP
financial measure disclosed by the Company is not meant to be considered
superior to or a substitute for results of operations prepared in accordance
with GAAP. Management uses Adjusted EBITDA (EBITDA adjusted for stock
based-compensation, deferred revenue recognized, manufacturing transition
costs and other non-cash expenses) to understand operational cash usage.  The
Company believes the non-GAAP financial measure provides useful and
supplementary information allowing investors greater transparency to one
measure used by management.  The non-GAAP financial measure is meant to
supplement, and to be viewed in conjunction with, GAAP financial measures.
 The non-GAAP financial measure is reconciled to the most comparable GAAP
financial measure below.

 

 

 

NxStage Medical, Inc.
Condensed Consolidated Statements of Comprehensive Loss
(in thousands, except per share data)
(unaudited)
                                                   Three Months Ended
                                                   March 31,
                                                   2013          2012
Revenues                                           $    61,644   $     56,951
Cost of revenues                                   37,644        35,639
Gross profit                                       24,000        21,312
Operating expenses:
Selling and marketing                              10,696        9,920
Research and development                           5,108         3,897
Distribution                                       4,908         4,532
General and administrative                         7,824         6,622
Total operating expenses                           28,536        24,971
Loss from operations                               (4,536)       (3,659)
Other expense:
Interest expense                                   (150)         (1,193)
Other expense, net                                 (176)         (52)
                                                   (326)         (1,245)
Net loss before income taxes                       (4,862)       (4,904)
Provision for income taxes                         132           240
Net loss                                           $   (4,994)   $    (5,144)
Net loss per share, basic and diluted              $     (0.08)  $      (0.09)
Weighted-average shares outstanding, basic and     59,381        55,773
diluted
Other comprehensive gain                           145           173
Total comprehensive loss                           $   (4,849)   $    (4,971)

 

NxStage Medical, Inc.

Condensed Consolidated Balance Sheets

(in thousands, except share data)

(unaudited)
                                                     March 31,    December 31,
                                                     2013         2012
ASSETS
Current assets:
Cash and cash equivalents                            $  99,803    $   106,439
Accounts receivable, net                             22,058       18,990
Inventory                                            36,966       33,504
Prepaid expenses and other current assets            4,825        2,534
Total current assets                                 163,652      161,467
Property and equipment, net                          37,317       36,320
Field equipment, net                                 10,297       10,101
Deferred cost of revenues                            36,135       38,028
Intangible assets, net                               19,120       19,819
Goodwill                                             42,421       42,421
Other assets                                         3,261        3,793
Total assets                                         $  312,203   $   311,949
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                                     $  20,593    $   16,645
Accrued expenses                                     19,561       20,400
Other current liabilities                            2,165        2,187
Total current liabilities                            42,319       39,232
Deferred revenues                                    57,191       59,262
Other long-term liabilities                          15,920       15,864
Total liabilities                                    115,430      114,358
Commitments and contingencies
Stockholders' equity:
Undesignated preferred stock: par value $0.001,
5,000,000 shares authorized;  no                     —            —
       shares issued and outstanding as of March 31,
2013 and December 31, 2012
Common stock: par value $0.001, 100,000,000 shares
authorized; 60,279,658 and                           60           59
       59,850,117 shares issued as of March 31, 2013
and December 31, 2012, respectively
Additional paid-in capital                           555,850      551,594
Accumulated deficit                                  (349,975)    (344,981)
Accumulated other comprehensive income               615          470
Treasury stock, at cost: 561,808 and 541,584 shares
as of March 31, 2013 and                             (9,777)      (9,551)
       December 31, 2012, respectively
Total stockholders' equity                           196,773      197,591
Total liabilities and stockholders' equity           $  312,203   $   311,949

 

 

NxStage Medical, Inc.

Cash Flows from Operating Activities

(in thousands)

(unaudited)
                                              Three Months Ended March 31,
                                            2013             2012
Cash flows from operating activities:
Net loss                                    $  (4,994)       $  (5,144)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization               6,080            5,720
Stock-based compensation                    2,646            3,199
Other                                       230              794
Changes in operating assets and
liabilities:
Accounts receivable                         (3,072)          (1,779)
Inventory                                   (6,350)          (4,738)
Prepaid expenses and other assets           (1,474)          (96)
Accounts payable                            4,124            (32)
Accrued expenses and other liabilities      (511)            1,916
Deferred revenues                           (1,887)          (1,248)
Net cash used in operating activities       $  (5,208)       $  (1,408)

 

NxStage Medical, Inc.
Revenues by Segment
(in thousands)
(unaudited)
                           Three Months Ended
                           March 31,
                           2013      2012
System One segment
Home                       $ 31,459  $ 29,553
Critical Care              10,710    9,787
Total System One segment   42,169    39,340
In-Center segment          18,700    17,611
Other                      775       —
Total                      $ 61,644  $ 56,951

 

NxStage Medical, Inc.

Non-GAAP Financial Measures

(in millions)

(unaudited)
                                                  Three Months Ended March 31,
                                                  2013               2012
Net loss                                          $          (5.0)   $  (5.1)
Less: Depreciation, amortization, interest, and   6.5                7.2
taxes
Less: Adjusting items*                            (1.2)              (0.3)
Adjusted EBITDA                                   $          0.3     $  1.8
* Adjusting items include stock-based compensation, deferred revenue
recognized,
  manufacturing transition costs and other non-cash expenses

 

SOURCE NxStage Medical, Inc.

Website: http://www.nxstage.com
Contact: Kristen K. Sheppard, Esq., VP, Investor Relations, +1-978-332-5923,
ksheppard@nxstage.com
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