Senseonics(US:SENS)2019-11-12 21:47Financial Performance - The company reported net losses of $19.5 million and $31.8 million for the three months ended September 30, 2019 and 2018, respectively, and $79.9 million and $86.7 million for the nine months ended September 30, 2019 and 2018, respectively[148]. - Net revenue decreased by $0.8 million to $4.3 million for the three months ended September 30, 2019, compared to $5.2 million for the same period in 2018[162]. - Gross profit was $(3.3) million for the three months ended September 30, 2019, with a gross margin of (77)%, compared to $(2.6) million and (50)% for the same period in 2018[164]. - Net loss improved by $12.4 million to $(19.5) million for the three months ended September 30, 2019, compared to $(31.9) million for the same period in 2018[162]. - Net revenue increased by $1.9 million to $12.3 million for the nine months ended September 30, 2019, compared to $11.7 million for the same period in 2018[173]. - Gross profit was $(11.2) million for the nine months ended September 30, 2019, with a gross margin of (91)%, compared to $(3.2) million and (27)% for the same period in 2018[175]. - Total other income, net, was $11.9 million for the three months ended September 30, 2019, compared to total other expense of $8.9 million for the same period in 2018, an increase of $20.8 million[169]. - Total other income, net, was $15.8 million for the nine months ended September 30, 2019, compared to total other expense of $27.7 million for the same period in 2018, an increase of $43.5 million[180]. Operational Developments - The company completed enrollment of the PROMISE 180-day U.S. pivotal clinical trial with 208 subjects across eight clinical sites, expecting to report topline data in the first half of 2020[136]. - A voluntary recall of 844 Eversense CGM Sensors was issued due to a malfunction in 1.4% of inserted sensors, costing the company $0.4 million[137][138]. - The company implemented a restructuring plan, reducing its workforce by approximately 30% and incurring one-time restructuring costs of about $0.8 million in Q4 2019[138]. - The Eversense system received FDA approval for non-adjunctive indication, allowing it to be used for dosing decisions, with a rollout planned for Q4 2019[147]. - The company introduced the Eversense Bridge Program in March 2019 to provide financial assistance to eligible patients, which is expected to enhance patient access to the Eversense system[146]. - The Eversense XL system is available in Europe, the Middle East, and Africa, with a sensor life of up to 180 days, compared to the 90-day life of the original Eversense system[135]. Financial Position and Funding - As of September 30, 2019, the company's accumulated deficit totaled $437.7 million, primarily due to expenses related to research and development and manufacturing costs for the Eversense system[148]. - The company expects to continue incurring net losses for the foreseeable future and will need to obtain additional funding to support ongoing operations[149]. - The company aims to reduce cash burn while ensuring the best allocation of capital to support the launch of the 180-day product in the U.S.[143]. - As of September 30, 2019, the company reported net cash used in operating activities of $101.5 million, compared to $67.1 million for the same period in 2018[214]. - The company provided $96.2 million in net cash from financing activities for the nine months ended September 30, 2019, primarily from the issuance of common stock and 2025 Notes[218]. - The company borrowed an aggregate principal amount of $45.0 million under the Solar Term Loan Agreement, with a maturity date of July 1, 2024[197]. - The company anticipates needing to finance cash needs through a combination of debt financings, equity offerings, and collaboration agreements[190]. - The company may face dilution of stockholder ownership if additional capital is raised through debt or equity offerings[190]. - Total contractual obligations amount to $190.074 million, with principal payments under the 2025 Notes totaling $82 million due after 2023[221]. - Cash and cash equivalents as of September 30, 2019, stand at $130.6 million, primarily held in interest-bearing money market accounts[228]. Debt and Interest Obligations - The interest rate on the Solar Term Loan is set at a floating annual rate of 6.50% plus a minimum floor interest rate of 8.98%[198]. - Interest payments under the Solar Term Loan total $13.835 million, with $8.111 million due in 2021 and $4.437 million due in 2023[221]. - The company issued $82.0 million in aggregate principal amount of 2025 Notes, which bear interest at a rate of 5.25% per year[206]. - The outstanding principal amount of the 2023 Notes was $15.7 million as of September 30, 2019[206]. - The interest rates on the 2023 Notes and 2025 Notes are fixed, while the Solar Term Loan has a variable rate subject to a minimum floor[228]. Risk Management and Compliance - The company does not currently engage in hedging transactions to manage exposure to interest rate risk or foreign currency exchange rate risk[228][229]. - A hypothetical 10% change in foreign currency exchange rates would not have a material impact on the company's operating results or financial condition[229]. - The company has irrevocably elected not to take advantage of the extended transition period under the JOBS Act, adopting new accounting standards as required[223]. - The company will no longer be classified as an emerging growth company at the end of the 2019 fiscal year, impacting its compliance with certain audit requirements[224]. - There have been no material changes to the company's critical accounting policies and estimates as disclosed in the previous year's financial statements[227].