TransEnterix, Inc. Reports Operating Results for the Fourth Quarter and Full Year 2014

RESEARCH TRIANGLE PARK, N.C.--()--TransEnterix, Inc. (NYSE MKT:TRXC), a medical device company that is pioneering the use of robotics and flexible instruments to improve minimally invasive surgery, today announced its operating and financial results for the fourth quarter and full year 2014. TransEnterix filed its Form 10-K for the year ended December 31, 2014 on Friday, February 20, 2015.

2014 Operating Highlights

  • Uplisted and began trading on NYSE MKT Market
  • Completed public offering of common stock, raising $52.4 million, net of issuance costs
  • Filed pre-submission documentation with FDA regarding the SurgiBot™ System
  • Completed 14 pre-clinical robotic surgical procedures using the SurgiBot System
  • Performed first human cases using SPIDER Flex Ligating Shears
  • Expanded loan agreement with Oxford Finance LLC and Silicon Valley Bank

“We continue to make solid progress towards our 510(k) submission for the SurgiBot System. We recently increased the frequency of our pre-clinical cases and have completed multiple general surgery and urology procedures using SurgiBot in the porcine model,” said Todd M. Pope, President and Chief Executive Officer of TransEnterix. “We remain on track to submit our 510(k) in mid-2015 and continue to focus on our goal to commercialize the first patient-side robotic surgery system following FDA clearance.”

For the three months ended December 31, 2014, the Company reported a net loss of $8.1 million, or $0.13 per share, including research and development expenses of $6.0 million, sales and marketing expenses of $0.4 million, and general and administrative expenses of $1.1 million. Operating expenses were primarily associated with the development of the SurgiBot System. For the full year ended December 31, 2014, the Company reported a net loss of $37.7 million, or $0.64 per share. On December 31, 2014, the Company's cash and cash equivalents totaled $34.8 million.

Conference Call

TransEnterix, Inc. will host a conference call on Tuesday, February 24, 2015 at 8:30 AM ET to discuss its 2014 fourth quarter and full year operating and financial results. To listen to the conference call on your telephone, please dial (888) 438-5449 for domestic callers or (719) 325-2142 for international callers approximately ten minutes prior to the start time. To access the live audio webcast or archived recording, use the following link http://ir.transenterix.com/events.cfm. The replay will be available on the Company's website.

About SurgiBot

The SurgiBot™ system, currently in development, is a minimally invasive, patient-side robotic surgery system. The system utilizes flexible instruments through articulating channels controlled directly by the surgeon, with robotic assistance, at the patient's bedside. The flexible nature of the system allows for multiple instruments to be introduced and deployed through a single incision. The SurgiBot system has not been cleared by the FDA for use the in United States.

About TransEnterix

TransEnterix is a medical device company that is pioneering the use of robotics and flexible instruments to improve minimally invasive surgery. The company is focused on the development and commercialization of the SurgiBot™ system, a minimally invasive surgical robotic system that allows the surgeon to be patient-side within the sterile field. For more information, visit the company's website at www.transenterix.com.

Forward-Looking Statements

This press release includes statements relating to the SurgiBot system, our flexible energy device and our current regulatory and commercialization plans for these products. These statements and other statements regarding our future plans and goals constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties that are often difficult to predict, are beyond our control, and which may cause results to differ materially from expectations. Factors that could cause our results to differ materially from those described include, but are not limited to, whether the SurgiBot system's 510(k) application(s) will be will be submitted by mid-2015 or cleared by the U.S. FDA, the pace of adoption of our products by surgeons, the success and market opportunity of our products, most notably the SurgiBot system, the effect on our business of existing and new regulatory requirements, and other economic and competitive factors. For a discussion of the most significant risks and uncertainties associated with TransEnterix's business, please review our filings with the Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K for the year ended December 31, 2014 filed with the SEC on February 20, 2015, and other filings we make with the SEC. You are cautioned not to place undue reliance on these forward looking statements, which are based on our expectations as of the date of this press release and speak only as of the date of this press release. We undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

TransEnterix, Inc.
Consolidated Statements of Operations and Comprehensive Loss
(unaudited)
(in thousands, except per share amounts)
 
       
Three months ended
December 31,
Year ended
December 31,
    2014     2013     2014     2013  
 
 
Sales $ 134 $ 219 $ 401 $ 1,431
 
Operating Expenses
Cost of goods sold 435 714 1,095 4,810
Research and development 5,984 4,845 27,944 12,700
Sales and marketing 404 453 1,727 1,943
General and administrative 1,111 1,556 6,244 4,221
Impairment loss on property and equipment 450 450
Merger expenses       20         2,911  
 
Total Operating Expenses   7,934     8,038     37,010     27,035  
 
 
Operating Loss   (7,800 )   (7,819 )   (36,609 )   (25,604 )
 
 
Other Expense
Remeasurement of fair value of preferred stock warrant liability (1,800 )
Interest expense, net   (279 )   (212 )   (1,043 )   (954 )
 
 
Total Other Expense, net   (279 )   (212 )   (1,043 )   (2,754 )
 
 
Net Loss $ (8,079 ) $ (8,031 ) $ (37,652 ) $ (28,358 )
 
 
Other comprehensive income (loss)                
 
 
Comprehensive loss $ (8,079 ) $ (8,031 ) $ (37,652 ) $ (28,358 )
 
 
Net loss per share - basic and diluted $ (0.13 ) $ (0.21 ) $ (0.64 ) $ (2.23 )
 
 
Weighted average common shares outstanding - basic and diluted   63,171     37,435     58,714     12,731  
 
TransEnterix, Inc.
Consolidated Balance Sheets
(unaudited)
(in thousands, except share amounts)
   
 

December 31,
2014

December 31,
2013
 
Assets
 
Current Assets
Cash and cash equivalents $ 34,766 $ 10,014
Short-term investments 6,191
Accounts receivable, net 133 188
Interest receivable 1 68
Inventory, net 701
Other current assets   789     593  
 
Total Current Assets   35,689     17,755  
 
 
Restricted cash 250 375
Property and equipment, net 3,120 1,864
Intellectual property, net 2,241 2,741
Trade names, net 7 10
Goodwill 93,842 93,842
Other long term assets   62     127  
 
Total Assets $ 135,211   $ 116,714  
 
 
Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable $ 1,768 $ 1,804
Accrued expenses 1,769 1,406
Note payable - current portion   610     3,879  
 
Total Current Liabilities 4,147 7,089
 
Long Term Liabilities
Note payable - less current portion, net of debt discount   9,275     4,602  
 
 
Total Liabilities 13,422 11,691
Commitments and Contingencies
 
Stockholders’ Equity
Common stock $0.001 par value, 750,000,000 shares authorized at December 31, 2014 and 2013; 63,182,806 and 48,841,417 shares issued and outstanding at December 31, 2014 and December 31, 2013, respectively (1) 63 49
Additional paid-in capital 257,642 203,238
Accumulated deficit   (135,916 )   (98,264 )
 
 
Total Stockholders’ Equity   121,789     105,023  
 
 
Total Liabilities and Stockholders’ Equity $ 135,211   $ 116,714  
 

(1) Adjusted for 1:5 reverse stock split on March 31, 2014.

TransEnterix, Inc.
Consolidated Statements of Cash Flows
(unaudited)
(in thousands)
   
 
Year Ended

December 31,

  2014     2013  
Operating Activities
Net loss $ (37,652 ) $ (28,358 )
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization 1,310 1,483
Amortization of debt discount 14
Amortization of debt issuance costs 69 103
Remeasurement of fair value of preferred stock warrant liability 1,800
Accretion/amortization of bond discount/premium 52
Stock-based compensation 1,840 941
Loss on disposal of property and equipment 86 31
Impairment loss on property and equipment 450
Changes in operating assets and liabilities:
Accounts receivable 55 402
Interest receivable 67 (52 )
Inventory 701 731
Other current and long term assets (170 ) (328 )
Restricted cash 125
Accounts payable (36 ) 641
Accrued expenses   363     868  
 
Net cash and cash equivalents used in operating activities   (33,228 )   (21,236 )
 
 
Investing Activities
Purchase of investments (6,240 )
Proceeds from sale and maturities of investments 6,191 904
Cash received in acquisition of a business, net of cash paid 246
Purchase of property and equipment (2,174 ) (1,377 )
Proceeds from sale of property and equipment   25      
 
Net cash and cash equivalents provided by (used in) investing activities   4,042     (6,467 )
 
 
Financing Activities
Proceeds from issuance of debt, net of debt discount 4,321 1,998
Payment of debt (2,877 ) (1,519 )
Proceeds from the issuance of common stock, net of issuance costs 52,433
Proceeds from issuance of preferred stock, net of issuance costs 28,199
Debt issuance costs (30 )
Proceeds from exercise of stock options and restricted stock units 75
Proceeds from exercise of warrants   16     143  
 
Net cash and cash equivalents provided by financing activities   53,938     28,821  
 
Net increase in cash and cash equivalents 24,752 1,118
Cash and Cash Equivalents, beginning of period   10,014     8,896  
 
Cash and Cash Equivalents, end of period $ 34,766   $ 10,014  
 
 
Supplemental Disclosure for Cash Flow Information
Interest paid $ 904   $ 824  
 
Supplemental Schedule of Noncash Investing and Financing Activities
Issuance of common stock warrants $ 54 $
Conversion of bridge notes to preferred stock $ $ 1,998
Conversion of preferred stock warrants to common stock warrants $ $ 1,909
Conversion of preferred stock to common stock $ $ 30,197
 

Contacts

Investor Contact:
Westwicke Partners
Mark Klausner, 443-213-0501
transenterix@westwicke.com
or
Media Contact:
TransEnterix, Inc.
Mohan Nathan, 919-917-6559
mnathan@transenterix.com

Contacts

Investor Contact:
Westwicke Partners
Mark Klausner, 443-213-0501
transenterix@westwicke.com
or
Media Contact:
TransEnterix, Inc.
Mohan Nathan, 919-917-6559
mnathan@transenterix.com