SUWANEE, GA–(Marketwired – Aug 14, 2017) – SANUWAVE Health, Inc. (OTCQB: SNWV), today reported financial results for the three and six months ended June 30, 2017 and provided a business update. The Company will host a conference call at 10:30AM Eastern Time on Tuesday, August 15, 2017.
Highlights of the second quarter and recent weeks:
- The Company appointed Dr. Maj-Britt Kaltoft to its Board of Directors. Dr. Kaltoft currently heads the business development and patent functions at the Danish State Serum Institute, an institution under the Danish Ministry of Health.
- The Company appointed retired Colonel Dr. Patrick Sesto to its Medical and Science Advisory Board. Dr. Sesto served 27 years active duty in the US Army and during that time was appointed by Major General Peake, US Army Surgeon General, to be his Consultant for Army Podiatry, a position he held for seven years.
- SANUWAVE signed a third amendment with HealthTronics, Inc. to extend the due date of its two promissory notes from January 31, 2018 to December 31, 2018.
- SANUWAVE entered into a Memorandum of Understanding with eKare, Inc. to develop novel wound care analysis and management solutions. Linking SANUWAVE’s dermaPACE wound treatment device with eKare’s inSight® 3D wound imaging and analytics system, the two companies will strive to produce the industry’s most comprehensive wound management solution.
- SANUWAVE appointed LITHOMED to act as distributors for the orthopedic products in Taiwan. LITHOMED has a wealth of experience within this specific indication in Taiwan as well as access and relationships with key opinion leaders which will prove to be of immense value for market development.
- SANUWAVE appointed Alat Medika Indonesia as distributor for dermaPACE® and liaison for clinical trials participation for their wound care product in Indonesia. It is well known that diabetes and related concerns need to be addressed within Indonesia and having access to outstanding technology such as SANUWAVE’s within the country is a positive step.
- SANUWAVE appointed Interventional Concepts, Inc. to act as Territory Sales Manager for sourcing and screening of potential distributors for the Company’s products in Columbia. Interventional Concepts will give SANUWAVE access to a multidisciplinary team of life science professionals in Columbia that provide regulatory and commercial support when introducing SANUWAVE’s products.
“The second quarter came in below plan but we remain confident we will achieve our seven goals for 2017 and as you can see we make great progress toward reaching these goals,” stated Kevin Richardson, CEO and Chairman. “The seven goals that we projected for 2017 were:
1. FDA approval in late 2017 or early 2018,
2. Add 7 to 10 new countries/regions to our portfolio,
3. Expand Board of Directors members from 4 to 7,
4. Expand Medical Advisory Board members from 2 to 5,
5. Produce record international sales,
6. Launch clinical work both domestically and internationally, and
7. Obtain at least one non-medical partner.
If we can achieve these goals in 2017, we will be well prepared for a rapid sales increase in 2018 as our commercialization efforts take effect,” concluded Mr. Richardson.
Second Quarter Financial Results
Revenues for the three months ended June 30, 2017 were $111,045, compared to $203,406 for the same period in 2016, a decrease of $92,361, or 45%. Revenues resulted primarily from sales in Europe, Asia and Asia/Pacific of our orthoPACE device and related applicators. The decrease in revenues for 2017 was due to lower sales of new orthoPACE devices and applicators in Europe and Asia/Pacific in 2017.
Research and development expenses for the three months ended June 30, 2017 were $437,909, compared to $476,167 for the same period in 2016, a decrease of $38,258, or 8%. Research and development expenses decreased in 2017 due to lower payments to consultants related to the de novo petition submission to the FDA in July 2016 and lower travel costs. This was partially offset by non-cash stock compensation expense for stock options issued in June 2017.
General and administrative expenses for the three months ended June 30, 2017 were $951,908, as compared to $589,896 for the same period in 2016, an increase of $362,012, or 61%. The increase in general and administrative expenses was due non-cash stock compensation expense for stock options issued in June 2017, tradeshow attendance in Europe and related travel expenses and increase in bad debt reserve.
Net loss for the three months ended June 30, 2017 was $1,415,937, or ($0.01) per basic and diluted share, compared to a net loss of $1,122,123, or ($0.01) per basic and diluted share, for the same period in 2016, an increase in the net loss of $293,814, or 26%. The increase in the net loss for 2017 was primarily due to the stock compensation expense for stock options issued during in June 2017 and an increase in the bad debt reserve and was partially offset by lower research and development expenses as noted above.
Six Months Ended June 30, 2017 Financial Results
Revenues for the six months ended June 30, 2017 were $260,614, compared to $472,730 for the same period in 2016, a decrease of $212,116, or 45%. Revenues resulted primarily from sales in Europe, Asia and Asia/Pacific of our orthoPACE device and related applicators. The decrease in revenues for 2017 was due to lower sales of new orthoPACE devices and applicators and lower applicator refurbishments in Europe and Asia/Pacific in 2017.
Research and development expenses for the six months ended June 30, 2017 were $698,247, compared to $786,122 for the same period in 2016, a decrease of $87,875, or 11%. Research and development expenses decreased in 2017 as a result of lower payments to consultants related to the de novo petition submission to the FDA in July 2016, which was partially offset by higher audit costs related to ISO certification and non-cash stock compensation expense for stock option issued in June 2017.
General and administrative expenses for the six months ended June 30, 2017 were $1,400,514, as compared to $1,089,028 for the same period in 2016, an increase of $311,486, or 29%. The increase in general and administrative expenses was due to non-cash stock compensation expense for stock options issued in June 2017, tradeshow attendance in Europe and related travel expenses and increase in bad debt reserve.
Net loss for the six months ended June 30, 2017 was $1,909,469, or ($0.01) per basic and diluted share, compared to a net loss of $2,846,699, or ($0.03) per basic and diluted share, for the same period in 2016, a decrease in the net loss of $937,230, or 33%. The decrease in the net loss for 2017 was primarily due to a gain on the warrant valuation and lower operating expenses as noted above.
The Company will also host a conference call on Tuesday, August 15, 2017, beginning at 10:30AM Eastern Time to discuss the second quarter financial results, provide a business update and answer questions. Shareholders and other interested parties can participate in the conference call by dialing 866-682-6100 (U.S.) or 862-255-5401 (international) or via webcast at
A replay of the conference call will be available beginning two hours after its completion through August 29, 2017, by dialing 877-481-4010 (U.S.) or 919-882-2331 (international) and entering Conference ID 19907.
About SANUWAVE Health, Inc.
SANUWAVE Health, Inc. (OTCQB: SNWV) (www.sanuwave.com) is a shock wave technology company initially focused on the development and commercialization of patented noninvasive, biological response activating devices for the repair and regeneration of skin, musculoskeletal tissue and vascular structures. SANUWAVE’s portfolio of regenerative medicine products and product candidates activate biologic signaling and angiogenic responses, producing new vascularization and microcirculatory improvement, which helps restore the body’s normal healing processes and regeneration. SANUWAVE applies its patented PACE technology in wound healing, orthopedic/spine, plastic/cosmetic and cardiac conditions. Its lead product candidate for the global wound care market, dermaPACE, is CE Marked throughout Europe and has device license approval for the treatment of the skin and subcutaneous soft tissue in Canada, Australia and New Zealand. In the U.S., dermaPACE is currently under the FDA’s de novo petition review process for the treatment of diabetic foot ulcers. SANUWAVE researches, designs, manufactures, markets and services its products worldwide, and believes it has demonstrated that its technology is safe and effective in stimulating healing in chronic conditions of the foot (plantar fasciitis) and the elbow (lateral epicondylitis) through its U.S. Class III PMA approved OssaTron® device, as well as stimulating bone and chronic tendonitis regeneration in the musculoskeletal environment through the utilization of its OssaTron, Evotron® and orthoPACE® devices in Europe, Asia and Asia/Pacific. In addition, there are license/partnership opportunities for SANUWAVE’s shock wave technology for non-medical uses, including energy, water, food and industrial markets.
This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities, and are thus prospective. Forward-looking statements include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, its directors or its officers. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control. Actual results may differ materially from those projected in the forward-looking statements. Among the key risks, assumptions and factors that may affect operating results, performance and financial condition are risks associated with the regulatory approval and marketing of the Company’s product candidates and products, unproven pre-clinical and clinical development activities, regulatory oversight, the Company’s ability to manage its capital resource issues, competition, and the other factors discussed in detail in the Company’s periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statement.
For additional information about the Company, visit www.sanuwave.com.
|SANUWAVE HEALTH, INC. AND SUBSIDIARIES|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|June 30,||December 31,|
|Cash and cash equivalents||$||62,069||$||133,571|
|Accounts receivable, net of allowance for doubtful accounts||191,932||460,799|
|TOTAL CURRENT ASSETS||548,520||914,146|
|PROPERTY AND EQUIPMENT, at cost, less accumulated depreciation||64,860||76,938|
|Accrued employee compensation||65,154||64,860|
|Advances from related parties||421,690||–|
|Interest payable, related parties||388,095||109,426|
|Short term loan, net||100,000||47,440|
|Notes payable, related parties, net||5,369,361||5,364,572|
|COMMITMENTS AND CONTINGENCIES|
|PREFERRED STOCK, SERIES A CONVERTIBLE, par value $0.001, 6,175 authorized; 6,175 shares issued and 0 shares outstanding in 2017 and 2016||–||–|
|PREFERRED STOCK, SERIES B CONVERTIBLE, par value $0.001, 293 authorized; 293 shares issued and 0 shares outstanding in 2017 and 2016, respectively||–||–|
|PREFERRED STOCK – UNDESIGNATED, par value $0.001, 4,993,532 shares authorized; no shares issued and outstanding||–||–|
|COMMON STOCK, par value $0.001, 350,000,000 shares authorized; 139,099,843 and 137,219,968 issued and outstanding in 2017 and 2016, respectively||139,100||137,220|
|ADDITIONAL PAID-IN CAPITAL||93,077,145||92,436,697|
|ACCUMULATED OTHER COMPREHENSIVE LOSS||(65,836||)||(52,069||)|
|TOTAL STOCKHOLDERS’ DEFICIT||(8,192,508||)||(6,911,600||)|
|TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT||$||627,357||$||1,004,870|
|SANUWAVE HEALTH, INC. AND SUBSIDIARIES|
|CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS|
|Three Months Ended||Three Months Ended||Six Months Ended||Six Months Ended|
|June 30,||June 30,||June 30,||June 30,|
|COST OF REVENUES (exclusive of depreciation and amortization shown below)||24,695||77,988||79,839||151,169|
|Research and development||437,909||476,167||698,247||786,122|
|General and administrative||951,908||589,896||1,400,514||1,089,028|
|Gain on sale of property and equipment||–||–||–||(1,000||)|
|TOTAL OPERATING EXPENSES||1,395,775||1,143,589||2,110,839||2,029,201|
|OTHER INCOME (EXPENSE)|
|Gain (loss) on warrant valuation adjustment and conversion||35,410||28,250||358,633||(769,447||)|
|Interest expense, net||(143,281||)||(129,334||)||(336,019||)||(363,764||)|
|Gain (loss) on foreign currency exchange||1,359||(2,868||)||(2,019||)||(5,848||)|
|TOTAL OTHER INCOME (EXPENSE), NET||(106,512||)||(103,952||)||20,595||(1,139,059||)|
|OTHER COMPREHENSIVE LOSS|
|Foreign currency translation adjustments||(15,552||)||(5,684||)||(13,767||)||(2,713||)|
|TOTAL COMPREHENSIVE LOSS||$||(1,431,489||)||$||(1,127,807||)||$||(1,923,236||)||$||(2,849,412||)|
|LOSS PER SHARE:|
|Net loss – basic and diluted||$||(0.01||)||$||(0.01||)||$||(0.01||)||$||(0.03||)|
|Weighted average shares outstanding – basic and diluted||138,992,669||102,645,697||138,517,370||88,933,089|
|SANUWAVE HEALTH, INC. AND SUBSIDIARIES|
|CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS|
|Six Months Ended||Six Months Ended|
|June 30,||June 30,|
|CASH FLOWS FROM OPERATING ACTIVITIES|
|Adjustments to reconcile net loss to net cash used by operating activities to net cash used by operating activities|
|Change in allowance for doubtful accounts||116,833||5,613|
|Stock-based compensation – employees, directors and advisors||482,295||116,550|
|(Gain) loss on warrant valuation adjustment||(358,633||)||769,447|
|Amortization of debt discount||57,349||11,472|
|Amortization of debt issuance costs||–||87,548|
|Loss on conversion option of promissory note payable||–||75,422|
|Gain on sale of property and equipment||–||(1,000||)|
|Changes in assets – (increase)/decrease|
|Accounts receivable – trade||152,034||(28,313||)|
|Changes in liabilities – increase/(decrease)|
|Accrued employee compensation||294||167,397|
|Interest payable, related parties||278,669||(131,579||)|
|Promissory notes, accrued interest||–||(77,615||)|
|NET CASH USED BY OPERATING ACTIVITIES||(572,492||)||(1,731,124||)|
|CASH FLOWS FROM INVESTING ACTIVITIES|
|Proceeds from sale of property and equipment||–||1,000|
|NET CASH PROVIDED BY INVESTING ACTIVITIES||–||1,000|
|CASH FLOWS FROM FINANCING ACTIVITIES|
|Proceeds from warrant exercise||93,067||–|
|Advances from related parties||421,690||–|
|Proceeds from 2016 Public Offering, net||–||1,596,855|
|Proceeds from convertible promissory notes, net||–||106,000|
|NET CASH PROVIDED BY FINANCING ACTIVITIES||514,757||1,702,855|
|EFFECT OF EXCHANGE RATES ON CASH||(13,767||)||(2,713||)|
|NET DECREASE IN CASH AND CASH EQUIVALENTS||(71,502||)||(29,982||)|
|CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD||133,571||152,930|
|CASH AND CASH EQUIVALENTS, END OF PERIOD||$||62,069||$||122,948|
|Cash paid for interest, related parties||$||–||$||392,516|
Millennium Park Capital LLC
SANUWAVE Health, Inc.
Kevin Richardson II
Chairman of the Board