Accelerate Diagnostics Reports Fourth Quarter and Full Year 2022 Financial Results

TUCSON, Ariz., March 29, 2023 /PRNewswire/ -- Accelerate Diagnostics, Inc. (Nasdaq: AXDX) today announced financial results for the fourth quarter and year ended December 31, 2022.

"In 2022, we achieved another year of revenue growth thanks to our base book of satisfied customers," commented Jack Phillips, Chief Executive Officer of Accelerate Diagnostics, Inc., "Though we fell short of our guidance target, we're emboldened by our new partnership with Becton Dickinson and the significant product development milestones we've achieved. The Accelerate Team is fully committed to driving growth and delivering value to our stakeholders."

Fourth Quarter 2022 Highlights

• Added 3 contracted instruments and brought 5 instruments live in the U.S. in the quarter.
• Ended the fourth quarter with 328 U.S. clinically live and revenue-generating instruments, with another 69 U.S. contracted instruments in the process of being implemented and not yet revenue-generating.
• Net sales were $3.0 million, compared to $3.3 million in the fourth quarter of the prior year, or a 9% decrease. This decrease was driven by the timing of capital equipment sales, while recurring revenues grew by 8% compared to the same period in the prior year.
• Gross margin was 28% for the quarter, compared to an adjusted 35% in the fourth quarter of the prior year, excluding non-cash adjustments for inventory impairment. The decline in gross margins resulted from inflation in manufacturing related costs and other factors.
• Selling, general, and administrative (SG&A) costs for the quarter were $8.8 million, compared to $11.5 million from the same quarter of the prior year. SG&A costs for the quarter excluding non-cash stock-based compensation were $6.8 million, compared to $8.3 million from the same quarter of the prior year. SG&A reductions over these periods were driven by streamlining our spend within the scope of our BD collaboration.
• Research and development (R&D) costs for the quarter were $6.0 million, compared to $4.6 million from the same quarter of the prior year. R&D costs excluding non-cash stock-based compensation expense for the quarter were $5.7 million, compared to $4.8 million from the quarter of the prior year. This increase was the result of investment in our next generation AST platform.
• GAAP net loss was $14.6 million in the fourth quarter, resulting in $0.15 net loss per share. Net loss excluding non-cash stock-based compensation expense for the fourth quarter was $12.2 million.
• Net cash used in the quarter excluding financing was $9.8 million.
• We continue to work with the holders of our convertible notes, which have matured, and other key stakeholders, and have agreed to an extension of the forbearance period to facilitate those continued discussions.

Year-to-date 2022 Highlights

• Net sales were $12.8 million year-to-date, compared to $11.8 million from the same period of the prior year, or an 8% increase. Growth was driven from increases in recurring revenues.
• Gross margin was 26% year-to-date, compared to an adjusted gross margin of 35% for the same period of the prior year, excluding non-cash adjustments for inventory impairment. The overall decline in gross margins resulted from ongoing pandemic-related impacts to manufacturing costs and other factors.
• Selling, general, and administrative (SG&A) costs year-to-date were $39.2 million, compared to $49.2 million from the same period of the prior year. SG&A costs excluding non-cash stock-based compensation were $30.7 million year to date, compared to $31.6 million from the same period of the prior year.
• Research and development (R&D) costs were $26.9 million year to date, compared to $21.9 million from the same period of the prior year. R&D costs excluding non-cash stock-based compensation expense were $25.5 million year to date, compared to $17.8 million from the same period of the prior year. These increases were the result of accelerating investment in our next generation AST platform, Wave.
• GAAP net loss was $62.5 million year to date, resulting in $0.76 net loss per share. Net loss excluding non-cash stock-based compensation expense was $51.9 million.
• Net cash used for the year was $50.9 million, excluding financing.
• Ended the year with total cash, investments, and cash equivalents of $45.6 million.

Full financial results for the year ended December 31, 2022 will be filed on Form 10-K through the Securities and Exchange Commission's (SEC) website at https://www.sec.gov.

Audio Webcast and Conference Call

To listen to the 2022 fourth quarter financial results, call by phone, +1.877.883.0383 and enter Elite Entry Number: 6648486. International participants may dial +1.412.902.6506. Please dial in 10–15 minutes prior to the start of the conference. A replay of the call will be available by telephone at +1.877.344.7529 (U.S.) or +1.412.317.0088 (International) using the replay code 2450672 until April 19, 2023.

This conference call will also be webcast and can be accessed from the company's website at ir.axdx.com. A replay of the audio webcast will be available for 30 days.

Use of Non-GAAP Financial Measures

This press release contains certain financial measures that are not recognized measures under accounting principles generally accepted in the United States of America ("GAAP"), which include SG&A, R&D, and operating income (loss) amounts excluding stock-based compensation expenses. 

Our management and board of directors use expenses excluding the cost of stock-based compensation to understand and evaluate our operating performance and trends, to prepare and approve our annual budget and to develop short-term and long-term operating and financing plans. Accordingly, we believe that expenses excluding the cost of stock-based compensation provides useful information for investors in understanding and evaluating our operating results in the same manner as our management and our board of directors. Expenses excluding the cost of stock-based compensation is a non-GAAP financial measure and should be considered in addition to, not as superior to, or as a substitute for, SG&A expenses, R&D expenses, and operating income (loss) reported in accordance with GAAP. The following tables present a reconciliation of SG&A expenses, R&D expenses and operating income (loss) excluding stock-based compensation to comparable GAAP measures for the periods indicated: 

About Accelerate Diagnostics, Inc.

Accelerate Diagnostics, Inc. is an in vitro diagnostics company dedicated to providing solutions for the global challenges of antibiotic resistance and sepsis. The Accelerate Pheno^® system and Accelerate PhenoTest^® BC kit combine several technologies aimed at reducing the time clinicians must wait to determine the most optimal antibiotic therapy for deadly infections. The FDA cleared system and kit fully automate the sample preparation steps to report phenotypic antibiotic susceptibility results in approximately 7 hours direct from positive blood cultures. Recent external studies indicate the solution offers results 1–2 days faster than existing methods, enabling clinicians to optimize antibiotic selection and dosage specific to the individual patient days earlier.

The "ACCELERATE DIAGNOSTICS" and "ACCELERATE PHENO" and "ACCELERATE PHENOTEST" and diamond shaped logos and marks are trademarks or registered trademarks of Accelerate Diagnostics, Inc.

For more information about the company, its products and technology, or recent publications, visit axdx.com.

Forward-Looking Statements

Certain of the statements made in this press release and the related web cast and conference call are forward-looking or may have forward-looking implications, such as, among others: the company's future financial performance; the company's future development plans and growth strategy, including plans and objectives relating to its future operations, products and performance, such as the development of the company's next generation AST platform; the company's expectations regarding the potential or benefits of its products and technologies; projections of future demand for the company's products; the anticipated impacts from the COVID-19 pandemic on the company, including to its business, results of operations, cash flows and financial position, as well as the company's future responses to the COVID-19 pandemic; the company's expectations relating to current supply chain impacts and inflationary pressures; the company's expectations regarding its commercial partnership with Becton, Dickinson and Company ("BD"), including anticipated benefits from such collaboration and BD's commercialization preparations and commitment to the company's long-term commercial partnership; the company's expectations and plans relating to regulatory approvals, including with respect to the U.S. Food and Drug Administration and 510(k) clearance for its Accelerate Arc products; and the company's expectations and plans regarding its financial condition, indebtedness and its liquidity and capital requirements, including, without limitation, as to the company's ability to continue as a going concern, obligations under the company's 2.50% Senior Convertible Notes due 2023 ("Notes") and discussions with holders of the Notes in connection with the related forbearance agreement.  Actual results or developments may differ materially from those projected or implied in these forward-looking statements due to significant risks and uncertainties, including, but not limited to: general industry and market conditions; regulatory developments; the duration and severity of the ongoing COVID-19 pandemic, including any new variants that may become predominant, any government and other third-party responses to it, the consequences for the global economy and the businesses of the company's suppliers and customers, such as the possibility of customer demand fluctuations, supply chain constraints and inflationary pressures, and ultimate effect of the COVID-19 pandemic on the company's business, results of operations, cash flows and financial position, as well as the company's ability (or inability) to execute on its plans to respond to the COVID-19 pandemic; and difficulties in resolving the company's continuing financial condition and ability to obtain additional capital to meet its financial obligations, including, without limitation, difficulties in obtaining adequate capital resources to fund the company's operations and address its debt obligations, including under the Notes.  Other important factors that could cause the company's actual results to differ materially from those in its forward-looking statements include those discussed in the company's filings with the Securities and Exchange Commission (the "SEC"), including in the "Risk Factors" sections of the company's most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings with the SEC. Except as required by federal securities laws, the company undertakes no obligation to update or revise these forward-looking statements to reflect new events, uncertainties or other contingencies.

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SOURCE Accelerate Diagnostics, Inc.