ReWalk(RWLK) - 2024 Q1 - Quarterly Report

Financial Performance - Total revenues for Q1 2024 were $5,283,000, a significant increase from$1,230,000 in Q1 2023, representing a growth of approximately 329%[24] - Gross profit for Q1 2024 was $1,395,000, compared to$571,000 in Q1 2023, indicating an increase of about 144%[24] - Operating loss for Q1 2024 was $(6,502,000), which is a larger loss compared to$(4,375,000) in Q1 2023, reflecting a deterioration of approximately 48%[24] - Net loss for Q1 2024 was $(6,276,000), compared to$(4,321,000) in Q1 2023, marking an increase in losses of about 45%[24] - The company reported a net cash used in operating activities of $7.7 million for the three months ended March 31, 2024, compared to$5.2 million for the same period in 2023[30] - Interest income for Q1 2024 was $288,000, compared to$73,000 in Q1 2023, representing a substantial increase of 294%[136] - The company recognized a total financial income of $232,000 in Q1 2024, compared to$78,000 in Q1 2023, indicating a growth of 197%[136] Cash and Assets - Cash and cash equivalents decreased to $20,744,000 as of March 31, 2024, down from$28,083,000 at the end of 2023, a decline of approximately 26%[16] - Total current assets decreased to $32,786,000 as of March 31, 2024, from$39,222,000 at December 31, 2023, a reduction of about 16%[16] - As of March 31, 2024, the company reported a cash balance of $396,000, an increase from$348,000 at December 31, 2023, reflecting a usage of $198,000 and a provision of$246,000 during the period[78] - The fair value of total assets measured at fair value was $5,169 thousand as of March 31, 2024, compared to$5,075 thousand at the end of 2023, reflecting a slight increase of about 1.85%[55] Liabilities and Equity - Total liabilities decreased to $14,603,000 as of March 31, 2024, down from$16,682,000 at December 31, 2023, a decrease of approximately 12.5%[21] - Total shareholders' equity fell to $40,615,000 as of March 31, 2024, compared to$46,510,000 at December 31, 2023, a decline of about 12.6%[19] Expenses - Research and development expenses increased to $1,291,000 in Q1 2024, up from$752,000 in Q1 2023, representing a rise of approximately 72%[24] - Sales and marketing expenses surged to $5,014,000 in Q1 2024, compared to$2,484,000 in Q1 2023, indicating an increase of about 102%[24] - Lease expenses for the three months ended March 31, 2024, were $328,000, compared to$192,000 for the same period in 2023[100] - General and administrative expenses increased to $220,000 in Q1 2024 from$193,000 in Q1 2023, which is an increase of 14%[130] Acquisitions and Investments - The company paid approximately $19 million for the acquisition of AlterG, Inc., with potential additional cash earnouts based on revenue growth over the next two years[36] - The total consideration for the acquisition of AlterG, Inc. amounted to$22.1 million, which includes cash payments of $18.493 million and earnout payments of$3.607 million[86] - The company has $7.5 million of goodwill related to the acquisition of AlterG, Inc., which has an indefinite life and is not tax-deductible[93] Future Outlook - The company expects to incur future net losses, with its transition to profitability dependent on successful product development and commercialization[40] - The company has sufficient funds to support its operations for more than 12 months following the issuance date of its financial statements[39] Shareholder Information - The company approved a one-for-seven reverse share split, reducing the number of issued and outstanding ordinary shares from approximately 60.1 million to approximately 8.6 million[109] - As of March 31, 2024, there were 2,734,504 warrants outstanding and exercisable, with various exercise prices ranging from$8.75 to $65.63[123] - The total unrecognized compensation costs related to non-vested share-based compensation arrangements amounted to$2.3 million, expected to be recognized over approximately 2.7 years[116] Revenue Breakdown - Revenue breakdown by geographic area shows the United States contributed $3,747,000, Europe$1,169,000, Asia-Pacific $180,000, and the rest of the world$187,000 for Q1 2024[138] - Major customer data indicates Customer A accounted for 26% of total revenues in Q1 2024, while Customer B contributed less than 10%[139] Legal and Regulatory - The company is involved in various legal claims, but is not currently party to any material litigation that could materially affect its financial condition[107] - On April 11, 2024, CMS approved a final payment level of $91,032 for Medicare reimbursement of the ReWalk Personal Exoskeleton, effective April 1, 2024[140]