Insulet Reports Third Quarter 2012 Results
Third Quarter 2012 Revenue Increases 23% Year Over Year; Gross Profit Improves by 31% Compared to Q3'11
BEDFORD, MA, Nov 08, 2012 (Menafn - MARKETWIRE via COMTEX) --Insulet Corporation PODD, the leader in tubeless insulinpump technology with its OmniPod(R) Insulin Management System, todayannounced financial results for the three and nine months endedSeptember 30, 2012.
Third quarter 2012 revenue increased 23% to 54.8 million, comparedto 44.6 million in the third quarter of 2011. Third quarter 2012revenue increased 7% over second quarter 2012 revenue of 51.0million. Gross profit for the third quarter of 2012 was 24.4million, an increase of 31% compared to a gross profit of 18.6million for the third quarter of 2011. The Company acquiredNeighborhood Diabetes on June 1, 2011 and its financial position andresults of operations have been included in the Company's financialresults since that date.
Operating loss in the third quarter of 2012 was 8.5 million,compared to operating loss of 9.8 million in the third quarter of2011. Total operating expenses were 32.9 million in the thirdquarter of 2012, compared to 28.3 million in the third quarter of2011. The increase is primarily due to the incremental costs relatedto the development and regulatory approval of the next generationOmniPod insulin pump and expansion of the commercial team throughoutthe year.
"Insulet delivered strong results once again in the third quarter,with sustained revenue growth, expanding gross margins and our firstmonth of operating cash profitability," said Duane DeSisto, Presidentand Chief Executive Officer of Insulet. "We achieved record levels ofOmniPod referrals and initial shipments this quarter. Our partner,Ypsomed, launched the next generation OmniPod in Europe and customershave been reporting that they love its smaller size and lighter feel.We are eagerly awaiting feedback from the U.S. Food and DrugAdministration on the additional data we submitted in late Septemberand are hopeful that we will soon receive 510(k) clearance of thenext generation OmniPod."
Net loss for the third quarter of 2012 was 12.4 million, or 0.26per share, compared to a net loss of 13.6 million, or 0.29 pershare, for the third quarter of 2011. Net loss for the third quarterof 2012 includes approximately 3.9 million of net interest expense,compared to 3.8 million of net interest expense in the third quarterof 2011.
For the nine months ended September 30, 2012, revenue increased 46%to 153.5 million from 105.1 million for the first nine months of2011. Gross profit for the first nine months of 2012 was 67.0million, as compared to a gross profit of 46.6 million in the firstnine months of 2011. Operating loss for the first nine months endedSeptember 30, 2012 was 29.9 million, as compared to an operatingloss of 32.0 million in the first nine months ended September 30,2011. Net loss for the first nine months of 2012 was 41.7 million,or 0.87 per share, compared to 42.8 million, or 0.92 per share,for the first nine months of 2011.
As of September 30, 2012, the Company had cash and cash equivalentsof 63.4 million compared to 94.0 million as of December 31, 2011.
Guidance The Company refined its estimate for full year 2012revenue to be in the range of 210 to 215 million and its estimatefor operating loss to be in the range of 35 to 38 million. For thefourth quarter of 2012, the Company is estimating revenue of 56.5 to61.5 million.
Conference Call Insulet will host a conference call on Thursday,November 8, 2012 at 5:00PM Eastern time to discuss the Company'sthird quarter results and present information concerning itsbusiness, strategies and outlook. To listen to the conference call,please dial 877-831-5664 for domestic callers and 832-412-1780 forinternational callers. The conference ID is 55165900. A replay of theconference call will be available two hours after the start of thecall through November 15, 2012 by dialing 855-859-2056 (domestic) and404-537-3406 (international), conference ID 55165900. An onlinearchive of the conference call will also be available by accessingthe Investor Information section of the company's website athttp://investors.insulet.com.
Forward-Looking Statement The September 30, 2012 financial resultscontained in this news release are subject to finalization inconnection with the preparation of the Company's Quarterly Report onForm 10-Q for the three and nine months ended September 30, 2012.This press release contains forward-looking statements which are madepursuant to the safe harbor provisions of Section 27A of theSecurities Act of 1933 and of Section 21E of the Securities ExchangeAct of 1934 concerning Insulet's expectations, anticipations,intentions, beliefs or strategies regarding the future, includingthose related to its expected revenue and operating losses, plannedexpansion of sales of the next generation OmniPod System in the U.S.and abroad, product demand, the market acceptance of our nextgeneration OmniPod System, regulatory matters and financialperformance. These forward-looking statements are based on itscurrent expectations and beliefs concerning future developments andtheir potential effects on Insulet. There can be no assurance thatfuture developments affecting Insulet will be those that it hasanticipated. These forward-looking statements involve a number ofrisks, uncertainties (some of which are beyond its control) or otherassumptions that may cause actual results or performance to bematerially different from those expressed or implied by theseforward-looking statements. These risks and uncertainties include,but are not limited to: risks associated with the Company'sdependence on the OmniPod System; Insulet's ability to increasecustomer orders and manufacturing volumes; adverse changes in generaleconomic conditions; impact of healthcare reform legislation;Insulet's inability to raise additional funds in the future onacceptable terms or at all; potential supply problems or pricefluctuations with sole source or other third-party suppliers on whichInsulet is dependent; international business risks; Insulet'sinability to obtain adequate coverage or reimbursement fromthird-party payors for the OmniPod System and potential adversechanges in reimbursement rates or policies relating to the OmniPod;potential adverse effects resulting from competition withcompetitors; technological innovations adversely affecting theCompany's business; potential termination of Insulet's license toincorporate a blood glucose meter into the OmniPod System; Insulet'sability to protect its intellectual property and other proprietaryrights; conflicts with the intellectual property of third parties,including claims that Insulet's current or future products infringethe proprietary rights of others; adverse regulatory or legal actionsrelating to the OmniPod System; failure to obtain timely regulatoryapproval for the sale of the next generation OmniPod System; failureof Insulet's contract manufacturers or component suppliers to complywith FDA's quality system regulations, the potential violation offederal or state laws prohibiting "kickbacks" or protecting patienthealth information, or any challenges to or investigations intoInsulet's practices under these laws; product liability lawsuits thatmay be brought against Insulet; reduced retention rates; unfavorableresults of clinical studies relating to the OmniPod System or theproducts of Insulet's competitors; potential future publication ofarticles or announcement of positions by physician associations orother organizations that are unfavorable to Insulet's products; theexpansion, or attempted expansion, into foreign markets; theconcentration of substantially all of Insulet's manufacturingcapacity at a single location in China and substantially all ofInsulet's inventory at a single location in Massachusetts; Insulet'sability to attract and retain key personnel; Insulet's ability tomanage its growth; intense competition among distributors of diabetessupplies impairing Insulet's business; loss of an opportunity to sellinsulin pumps supplied by Insulet's competitors; failure to retainkey supplier and payor partners; failure by Neighborhood Diabetes toretain supplier pricing discounts and achieve satisfactory grossmargins; failure to retain and manage successfully Insulet's Medicareand Medicaid business; existence of unanticipated liabilities arisingin connection with the Neighborhood Diabetes business; fluctuationsin quarterly results of operations; risks associated with potentialfuture acquisitions; Insulet's ability to generate sufficient cash toservice all of its indebtedness; the expansion of Insulet'sdistribution network; Insulet's ability to successfully maintaineffective internal controls; and other risks and uncertaintiesdescribed in its Annual Report on Form 10-K, which was filed with theSecurities and Exchange Commission on February 28, 2012 in thesection entitled "Risk Factors," and in its other filings from timeto time with the Securities and Exchange Commission. Should one ormore of these risks or uncertainties materialize, or should any ofits assumptions prove incorrect, actual results may vary in materialrespects from those projected in these forward-looking statements.Insulet undertakes no obligation to publicly update or revise anyforward-looking statements.
About Insulet Corporation Insulet Corporation PODD is aninnovative medical device company dedicated to making the lives ofpeople with diabetes easier. Through its OmniPod Insulin ManagementSystem, Insulet seeks to expand the use of insulin pump therapy amongpeople with insulin-dependent diabetes. The OmniPod is arevolutionary and easy-to-use tubeless insulin pump that featuresjust two parts and fully-automated cannula insertion. Insulet'ssubsidiary, Neighborhood Diabetes, is a leading distributor fordiabetes products and supplies, delivered through a high touchcustomer service model. Founded in 2000, Insulet Corporation is basedin Bedford, Mass. For more information, please visit:http://www.myomnipod.com.
INSULET CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months EndedNine Months Ended
September 30,September 30,
------------------------------------------------
2012201120122011
--------------------------------------------
(Unaudited)
(In thousands, except share and per share data)
Revenue54,75244,594153,541105,063
Cost of revenue30,36226,03386,52458,431
--------------------------------------------
Gross profit24,39018,56167,01746,632
Operating expenses:
Research and
development6,5594,63818,51216,059
General and
administrative12,73111,37938,41631,585
Sales and marketing13,57112,31239,97430,943
--------------------------------------------
Total operating
expenses32,86128,32996,90278,587
--------------------------------------------
Operating loss(8,471)(9,768)(29,885)(31,955)
Other expense, net(3,918)(3,794)(11,645)(10,876)
--------------------------------------------
Net loss before income
taxes(12,389)(13,562)(41,530)(42,831)
Income tax expense(28)-(143)-
--------------------------------------------
Net loss(12,417) (13,562) (41,673) (42,831)
============================================
Net loss per share basic
and diluted(0.26) (0.29) (0.87) (0.92)
============================================
Weighted average number
of shares used in
calculating basic and
diluted net loss per
share48,041,39247,321,98947,825,13646,442,236
============================================
INSULET CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
As ofAs of
September 30,December 31,
20122011
--------------------------
(Unaudited)
(In thousands, except share
data)
ASSETS
Current Assets
Cash and cash equivalents63,44393,955
Accounts receivable, net30,14523,190
Inventories15,08911,838
Prepaid expenses and other current assets4,7172,802
--------------------------
Total current assets113,394131,785
Property and equipment, net24,91019,422
Intangible assets, net24,35829,002
Goodwill26,64726,647
Other assets2,3332,727
--------------------------
Total assets191,642209,583
==========================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable16,21611,418
Accrued expenses17,81613,064
Deferred revenue1,1382,582
Current portion of long-term debt14,134-
Other current liabilities38931
--------------------------
Total current liabilities49,34227,995
Long-term debt101,517108,540
Other long-term liabilities1,6701,652
--------------------------
Total liabilities152,529138,187
Stockholders' Equity
Preferred stock, .001 par value:
Authorized: 5,000,000 shares at September
30, 2012 and December 31, 2011. Issued and
outstanding: zero shares at September 30,
2012 and December 31, 2011--
Common stock, .001 par value:
Authorized: 100,000,000 shares at September
30, 2012 and December 31, 2011. Issued and
outstanding: 48,114,876 and 47,504,131
shares at September 30, 2012 and December
31, 2011, respectively4848
Additional paid-in capital521,761512,371
Accumulated deficit(482,696)(441,023)
--------------------------
Total stockholders' equity39,11371,396
--------------------------
Total liabilities and stockholders' equity 191,642209,583
==========================
Contact:
Stephanie Marks for Insulet Corporation
ir@insulet.com
877-PODD-IR1 (877-763-3471)
SOURCE: Insulet Corporation
mailto:ir@insulet.com
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