ReWalk(RWLK) - 2024 Q3 - Quarterly Report

Financial Performance - Revenues for the three months ended September 30, 2024, were $6.128 million, an increase of 39$4.403 million for the same period in 2023[19]. - Gross profit for the three months ended September 30, 2024, was $2.220 million, compared to$863 thousand for the same period in 2023, reflecting a significant improvement[19]. - Operating loss for the three months ended September 30, 2024, was $(3.174) million, an improvement from$(7.942) million for the same period in 2023[19]. - Net loss for the three months ended September 30, 2024, was $(3.084) million, compared to$(7.531) million for the same period in 2023, indicating a narrowing loss[19]. - The net loss for the nine months ended September 30, 2024, was $13,664,000, compared to a net loss of$16,494,000 for the same period in 2023, indicating an improvement of about 17.5%[23]. - Gross profit for Q3 2024 was $2.22 million, representing 36.2$6.37 million, or 35.2% of revenue, compared to 28.8% in the same period of 2023[160]. Expenses - Research and development expenses for the three months ended September 30, 2024, were $998 thousand, down from$1.262 million for the same period in 2023, reflecting cost management efforts[19]. - Sales and marketing expenses for the three months ended September 30, 2024, were $4.156 million, slightly up from$4.088 million for the same period in 2023[19]. - Research and development expenses for Q3 2024 were $0.998 million, a decrease of 20.1$3.49 million, primarily due to the acquisition of AlterG[163]. - Sales and marketing expenses for Q3 2024 were $4.16 million, a slight increase of 2$13.57 million, reflecting a 49.5% increase from the same period in 2023[167]. - General and administrative expenses for Q3 2024 were $0.24 million, a significant decrease of 93$11,014,000, down from $33,286,000 at the end of September 30, 2023, representing a decrease of approximately 66.9$17,749,000 for the nine months ended September 30, 2024, compared to $16,183,000 for the same period in 2023, showing an increase of about 9.7$10.7 million as of September 30, 2024, with a negative operating cash flow of $17.7 million for the nine months ended September 30, 2024[32]. - Net cash used in operating activities increased by$1.6 million, or 9.7%, for the nine months ended September 30, 2024, primarily due to increased trade receivables and inventory purchases[188]. - Net cash used in investing activities decreased by $18.1 million, primarily due to the acquisition of AlterG in 2023[189]. - Net cash used in financing activities decreased by$1 million, or 100%, for the nine months ended September 30, 2024, due to the expiration of the share repurchase program[189]. Assets and Liabilities - Total current liabilities decreased to $9.657 million as of September 30, 2024, from$11.795 million as of December 31, 2023, indicating improved financial health[17]. - Total liabilities decreased to $11.877 million as of September 30, 2024, from$16.682 million as of December 31, 2023, showing a reduction in overall debt[17]. - The balance of accumulated deficit increased to $249,547,000 as of September 30, 2024, from$230,244,000 as of September 30, 2023, reflecting a rise of approximately 8.4%[22]. - The company reported a total shareholders' equity of $33.893 million as of September 30, 2024, down from$46.510 million as of December 31, 2023[17]. - As of September 30, 2023, total shareholders' equity decreased to $51,776,000 from$58,974,000 as of June 30, 2023, reflecting a decline of approximately 12.3%[22]. Acquisition and Business Development - The Company acquired AlterG, Inc. for a cash purchase price of approximately $19 million, with potential additional cash earnouts based on AlterG's year-over-year revenue growth over the next two years[29]. - The acquisition of AlterG, Inc. resulted in$7.5 million of goodwill, which has an indefinite life and is not tax-deductible[88]. - The company has established distribution agreements in the U.S. for its ReStore Exo-Suit and is the exclusive distributor of MYOLYN MyoCycle devices[27]. - Lifeward Ltd. designs and develops medical devices, including the ReWalk Personal and Rehabilitation Exoskeleton devices for individuals with spinal cord injuries, which utilize patented technology for mobility[26]. - The company is pursuing updates with CMS to clarify Medicare coverage for personal exoskeletons, with 57% of the SCI population relying on Medicare and Medicaid as primary payors[144]. Shareholder Actions - A reverse share split of 1-for-7 was approved, reducing the number of issued and outstanding ordinary shares from approximately 60.1 million to 8.6 million[105]. - As of September 30, 2024, the company repurchased a total of 574,658 ordinary shares at a total cost of $3.5 million[118]. - The company received court approval for a share repurchase program totaling$8.0 million, which was later extended by an additional $5.8 million[117]. Future Outlook - The Company expects to incur future net losses and its transition to profitability depends on successful product development and commercialization, as well as establishing distribution contracts[33]. - The company intends to fund future operations through cash on hand, additional private and/or public offerings, and may seek additional capital through strategic partnerships[33]. - The company expects to save approximately$3 million in operating expenses from the consolidation of U.S. operations following the AlterG acquisition[179]. - The company has contractual obligations totaling $7.78 million as of September 30, 2024, including purchase obligations and operating lease obligations[191].