Delcath Reports 2013 Fourth Quarter And Full Year Results

          Delcath Reports 2013 Fourth Quarter And Full Year Results

- Conference Call and Webcast Today at 4:30 p.m. ET -

PR Newswire

NEW YORK, March 12, 2014

NEW YORK, March 12, 2014 /PRNewswire/ --Delcath Systems, Inc. (NASDAQ: DCTH)
today reported financial results and operational developments for the fiscal
fourth quarter and full year ended December 31, 2013. Developments for the
quarter and recent weeks subsequent to quarter end are as follows:

  oThe Company's cash and cash equivalents increased in the fourth quarter
    2013 and the first quarter of 2014; cash position as of February 28, 2014
    was $32.7 million; fourth quarter 2013 cash utilization was $6.2 million
  o2014 average quarterly cash utilization expected to be between $5 and $6
    million
  oIn December 2013 Delcath received comments from FDA on its proposed HCC
    trial protocol to investigate Melphalan HDS for first-line treatment of
    patients with unresectable advanced hepatocellular carcinoma (HCC) or
    primary liver cancer; a supplemental Investigational New Drug (IND)
    application incorporating FDA comments was submitted to FDA in February
    2014; FDA review of the IND is pending
  oThe Company received the approval from shareholders authorizing its Board
    of Directors, at its discretion, to effect a reverse stock split of the
    common stock at a specific ratio within a range from 1-for-8 to 1-for-16,
    inclusive, on or prior to December 31, 2014

"During our fourth quarter we continued to make steady progress on our main
priorities of CHEMOSAT clinical adoption inEuropeand our clinical
development program for HCC," commented Jennifer K. Simpson, Interim
Co-President and Co-CEO. "We are optimistic that clinical adoption is
progressing in Germany and the U.K., key target markets that we believe offer
the best near-term revenue opportunities. Experience with CHEMOSAT therapy
continues to build, with 89 procedures performed on 61 patients since we first
introduced CHEMOSAT in Europe. Concurrently, we had dialogue with the FDA on
our supplemental IND submission and with the clinical institutions that will
be conducting our HCC studies. As a result of our February IND submission, and
assuming scientific review and institutional review board approvals, we now
anticipate clinical institutions to become activated in the second quarter of
2014."

Financial Results

For the fourth quarter ended December 31, 2013, total revenue was $0.3 million
compared with total revenue of $0.2 million in the fourth quarter 2012.
Operating expenses decreased by approximately 52% to $5.8 million from $12.0
million for the same period in 2012. The decrease is primarily due to a
significant reduction in expenses related to the Company's NDA submission to
the FDA, as well as the Company's overall cost management efforts. Operating
loss was $5.5 million, which included non-cash stock-based compensation income
of $0.3 million, as compared with an operating loss of $11.8 million,
including $0.9 million in non-cash stock-based compensation expense, in the
year ago period.

For the full year ended December 31, 2013, total revenue was approximately
$0.8 million of which $0.3 million was related to the recognition of
previously deferred revenue. Total operating expenses decreased by
approximately 38% to $33.3 million from $54.2 million for the same period in
2012. Operating loss for the year was $33.0 million, which included $0.3
million in non-cash stock-based compensation expense, as compared with an
operating loss of $53.9 million, including $3.8 million in non-cash
stock-based compensation expense, in the year ago period.

In 2013, Delcath raised approximately $43.2 million before related expenses,
including approximately $26.7 million through the Company's At-the-Market
equity offering program, $9.0 million through its Committed Equity Financing
Facility program, and approximately $7.5 million through a registered direct
offering.

Cash and cash equivalents as of December 31, 2013 were $31.2 million, compared
with $23.7 million at December 31, 2012. During the year, cash used in
operating activities was $34.1 million, a 32% reduction compared to $50.0
million in the comparable period in 2012. The decrease in cash utilization was
in part due to a reduction in NDA submission-related costs, and improved
organizational and operational efficiencies.

During the first quarter through February 28, 2014, the Company raised
approximately $4.5 million before related expenses through our At-the-Market
offering program. As of February 28, 2014, the Company's cash and cash
equivalents were $32.7 million, including $0.4 million in accounts receivables
collection.

"During the second half of 2013, we made significant progress in streamlining
our business operations and improving our operational efficiencies, while
focusing on our key priorities. As a result, we successfully reduced our
operating costs and cash burn to more sustainable levels, and we believe we
have sufficient resources to execute our plan into the first half of 2015,"
said Graham G. Miao, Interim Co-President and Co-CEO.

On February 24, 2014, shareholders approved an amendment to the Company's
Amended and Restated Certificate of Incorporation authorizing the Board of
Directors to affect a reverse stock split of the Company's common stock at a
specific ratio within a range from 1-for-8 to 1-for-16, inclusive, on or prior
to December 31, 2014. If deemed necessary by the Board, a reverse stock split
may enable the Company to regain compliance with NASDAQ's $1.00 minimum bid
price requirement by June 9, 2014, and maintain its listing on the NASDAQ
Capital Market.

Conference Call and Webcast

The Company will host a conference call today, March 12, 2014 at 4:30 p.m. ET
to discuss its financial results for the fourth quarter and full year of 2013
ended December 31, 2013, and provide an update on recent corporate progress.
The dial-in numbers for the conference call are 800-706-7749 (U.S.
participants) and 617-614-3474 (international participants); both numbers
require passcode 27241849. To access the live webcast, go to the Events &
Presentations page on the Investor Relations section of the Company's website
at http://www.delcath.com/investors/events/.

A taped replay of the call will be available beginning approximately two hours
after the call's conclusion and will be available for seven days. Dial-in
numbers for the replay are 888-286-8010 and 617-801-6888 for U.S. and
International callers, respectively. The replay passcode for both U.S. and
International callers is 49674508. An archived webcast will also be available
athttp://www.delcath.com/investors/events/.

About Delcath Systems

Delcath Systems, Inc. is a specialty pharmaceutical and medical device company
focused on oncology. Our proprietary drug/device combination product, the
Delcath Hepatic Delivery System, is designed to administer high dose
chemotherapy and other therapeutic agents to the liver, while controlling the
systemic exposure of those agents. The Company's initial focus is on the
treatment of primary and metastatic liver cancers. Outside of the United
States, our proprietary product to deliver and filter melphalan hydrochloride
is marketed under the trade name Delcath Hepatic CHEMOSAT® Delivery System for
Melphalan Hydrochloride. The Company obtained authorization to affix a CE Mark
for the Generation Two CHEMOSAT Delivery System for Melphalan in April 2012.
The right to affix the CE mark allows the Company to market and sell the
CHEMOSAT Delivery System for Melphalan in Europe. The Delcath Hepatic Delivery
System for Melphalan has not been approved for sale in the United States by
the United States Food and Drug Administration. The Company has initiated
plans to investigate Melphalan Hydrochloride for Injection for use with the
Delcath Hepatic Delivery System for primary liver cancer.

Private Securities Litigation Reform Act of 1995 provides a safe harbor for
forward-looking statements made by the Company or on its behalf. This news
release contains forward-looking statements, which are subject to certain
risks and uncertainties that can cause actual results to differ materially
from those described. Factors that may cause such differences include, but are
not limited to, uncertainties relating to:the Company's ability to achieve
the estimated average quarterly cash utilization for 2014, the impact of the
potential reverse stock split and the Company's ability to regain compliance
with the NASDAQ Marketplace Rules and maintain its listing on the NASDAQ
Capital market, FDA clearance of the Company's IND supplement including the
protocol for the Phase II HCC clinical trial and IRB clearance of the same
from participating site and the timing of site activation and subject
enrollment in the HCC Phase II trial, the timing and results of future
clinical trials including without limitation the HCC clinical trial program,
the ability of hospitals in Germany to successfully negotiate and receive
reimbursement for the CHEMOSAT procedure in their region under Value 4 status
and the amount of reimbursement, if any, to be provided under Value 4 status
in 2014, approval of Individual Funding Requests for reimbursement of the
CHEMOSAT procedure, the impact of Value 4 status on potential CHEMOSAT product
use and sales in Germany, clinical adoption, use and resulting sales, if any,
for the CHEMOSAT system to deliver and filter Melphalan in Europe including
the key markets of Germany and the UK, the Company's ability to successfully
commercialize the Melphalan HDS/ CHEMOSAT system and the potential of the
Melphalan HDS/CHEMOSAT system as a treatment for patients with primary and
metastatic disease in the liver, our ability to obtain reimbursement for the
CHEMOSAT system in various markets, the Company's ability to satisfy the
requirements of the FDA's Complete Response Letter and provide the same in a
timely manner, approval of the current or future Melphalan HDS/CHEMOSAT system
for delivery and filtration of Melphalan, doxorubicin or other
chemotherapeutic agents for various indications in the US and/or in foreign
markets, actions by the FDA or other foreign regulatory agencies, the
Company's ability to successfully enter into strategic partnership and
distribution arrangements in foreign markets and the timing and revenue, if
any, of the same, uncertainties relating to the timing and results of research
and development projects, and uncertainties regarding the Company's ability to
obtain financial and other resources for any research, development, clinical
trials and commercialization activities. These factors, and others, are
discussed from time to time in our filings with the Securities and Exchange
Commission. You should not place undue reliance on these forward-looking
statements, which speak only as of the date they are made. We undertake no
obligation to publicly update or revise these forward-looking statements to
reflect events or circumstances after the date they are made.

Contact Information: 
Investor Contact:                Media Contact:
Michael Polyviou/Patty Eisenhaur John Carter
EVC Group                        EVC Group
212-850-6020/951-316-0577        212-850-6021



DELCATH SYSTEMS, INC.
Consolidated Balance Sheets
as of December 31, 2013 and December 31, 2012
(in thousands, except share data)
                                              December 31,    December 31,
                                              2013              2012
Assets:
Current assets
 Cash and cash equivalents                  $ 31,249          $ 23,726
 Accounts receivables, net                    349               144
 Inventories                                  719               1,105
 Prepaid expenses and other current assets    1,711             1,457
         Total current assets                 34,028            26,432
 Property, plant and equipment, net           3,069             4,042
         Total assets                       $ 37,097          $ 30,474
Liabilities and Stockholders' Equity:
Current liabilities
 Accounts payable                           $ 582             $ 939
 Accrued expenses                             3,740             5,790
 Warrant liability                            2,310             3,427
         Total current liabilities            6,632             10,156
Long term liabilities
 Deferred revenue                             6                 309
 Accrued expenses                             360               -
         Total long term liabilities          366               309
Commitments and contingencies                 -                 -
Stockholders' equity
 Preferred stock, $.01 par value;
 10,000,000 shares authorized;no shares      -                 -
 issued and outstanding at December 31,
 2013 and December 31, 2012
 Common stock, $.01 par value; 170,000,000
 shares authorized; 134,310,337 and
 76,849,033 shares issued and 134,282,237     1,343             768
 and 76,820,933 shares outstanding at
 December 31, 2013 and December 31, 2012,
 respectively
 Additional paid-in capital                   257,843           218,063
 Accumulated deficit                          (229,132)         (198,808)
 Treasury stock, at cost; 28,100 shares at    (51)              (51)
 December 31, 2013 and December 31, 2012
 Accumulated other comprehensive income       96                37
         Total stockholders' equity           30,099            20,009
         Total liabilities and              $ 37,097          $ 30,474
         stockholders' equity



Delcath Systems, Inc.
Consolidated Statements of Operations and Comprehensive Loss
for the three and twelve months ended December 31, 2013 and 2012
(in thousands, except share data)
                      Three months ended December  Twelve Months Ended
                      31,                          December 31,
                      2013           2012          2013           2012
Product revenue       $ 338          $ 200         $ 490          $ 346
Other revenues          -              -             300            -
Total revenue           338            200           790            346
Cost of goods sold      (78)           (39)          (464)          (39)
Gross profit            260            161           326            307
Operating expenses:
   Selling, general
   and                $ 3,737        $ 6,360       $ 20,657       $ 27,963
   administrative^1
   Research and         2,049          5,626         12,688         26,215
   development^1
Total operating         5,786          11,986        33,345         54,178
expenses
Operating loss          (5,526)        (11,825)      (33,019)       (53,871)
Change in fair value
of warrant              410            1,134         2,756          2,159
liability, net
Interest income         2              4             20             19
Other expense and       322            30            (81)           (175)
interest expense
Net loss              $ (4,792)      $ (10,657)    $ (30,324)     $ (51,868)
Common share data:
   Basic loss per     $ (0.04)       $ (0.14)      $ (0.30)       $ (0.85)
   share
   Diluted loss per   $ (0.04)       $ (0.14)      $ (0.31)       $ (0.85)
   share
Weighted average
number of basic         120,849,824    74,440,509    100,809,824    61,275,527
common
sharesoutstanding
Weighted average
number of diluted       120,849,824    74,440,509    105,104,177    61,275,527
common
sharesoutstanding
Other comprehensive
income (loss):
   Foreign currency
   translation        $ (325)        $ (46)        $ 59           $ 37
   adjustments
Comprehensive loss    $ (5,117)      $ (10,703)    $ (30,265)     $ (51,831)
   Note 1:
   Includes non-cash
   stock-based
   compensation as
   follows:
                      Three months ended          Twelve Months Ended
                      December 31,                December 31,
                      2013           2012          2013           2012
   Selling, general
   and                $ 9            $ 569         $ 379          $ 2,398
   administrative
   Research and         (305)          334           (88)           1,427
   development
   Total stock-based
   compensation       $ (296)        $ 903         $ 291          $ 3,825
   expense

SOURCE Delcath Systems, Inc.

Website: http://www.delcath.com
 
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