Mauna Kea Technologies Reports Second Quarter and First Half of 2020 Sales

First Half of 2020 total sales down 47%; U.S. sales down 19%
Second Quarter total sales down 72%; U.S. sales down 47%
Sufficient liquidity to manage the business through the third quarter of 2021

PARIS & BOSTON--()--Regulatory News:

Mauna Kea Technologies (Paris:MKEA) (OTCQX:MKEAY) inventor of Cellvizio®, the multidisciplinary probe and needle-based confocal laser endomicroscopy (p/nCLE) platform, today announced its sales for the second quarter and first half of 2020 ended June 30, 2020.

Second Quarter 2020 Sales Summary

  • Total sales for the second quarter of 2020 decreased €1.6 million, or 72% year-over-year, to €0.6 million
    • Consumables sales decreased €0.8 million, or 71% year-over-year, to €0.3 million
    • Systems sales decreased €0.8 million, or 100% year-over-year, to €0.0 million
    • Services sales increased €35 thousand, or 14% year-over-year, to €0.3 million

First Half of 2020 Sales Summary

  • Total sales for the first half of 2020 decreased €1.8 million, or 47% year-over-year, to €2.1 million
    • Consumables sales decreased €1.1 million, or 52% year-over-year, to €1.0 million
    • Systems sales decreased €0.8 million, or 59% year-over-year, to €0.6 million
    • Services sales increased €36 thousand, or 7% year-over-year, to €0.6 million

“As expected, second quarter procedure and adoption trends in our primary commercial markets around the world were significantly impacted by the global crisis caused by the coronavirus, or COVID-19,” stated Robert L. Gershon, Chief Executive Officer of Mauna Kea Technologies. “We reported a decrease in sales of €1.6 million, or 72% year-over-year, in the second quarter with half of the decline coming from lower system sales and half of the decline coming from lower consumables demand. While we are not pleased with the year-over-year decline in total sales in Q2, we are encouraged by the fact that we have seen a pronounced improvement in our underlying business trends as we moved through the second quarter as restrictions were lifted and practices began to re-open; specifically we saw U.S. procedure volume return to pre-COVID levels for the month of June. We continue to navigate the unprecedented changes in our target markets responsibly and we are focused on ensuring that the organization is well-positioned to drive growth post COVID-19 when normal case loads resume in the U.S., APAC and EMEA/ROW regions.”

Mr. Gershon continued: “Importantly, we made significant progress in recent months towards our goal of enhancing our financial condition and maximizing our capital resources to support the Company's strategic growth initiatives. We have implemented a series of significant cost-cutting actions designed to tightly control operating expenses, we secured non-dilutive financings of $0.7 million (€0.64 million) and €4 million through the Paycheck Protection Program and the French state-guaranteed loans program, respectively, and we announced the drawndown of the €6m second tranche of our financing agreement with the European Investment Bank. Together, these actions should provide sufficient liquidity to manage the business through the third quarter of 2021.”

Second Quarter and First Half of 2020 Sales by Category

(in € millions) –
IFRS

Q2
2020

Q2
2019

% Chg.
Y/Y

6 Months
2020

6 Months
2019

% Chg.
Y/Y

Systems

0.0

0.8

(100%)

0.6

1.3

(59%)

Consumables

0.3

1.2

(71%)

1.0

2.1

(52%)

Services

0.3

0.2

14%

0.6

0.5

7%

Total Sales

0.6

2.2

(72%)

2.1

3.9

(47%)

Total sales for the second quarter of 2020 were €0.6 million, down 72% year-over-year. Second quarter sales results were driven by a 14% increase in services revenue, which partially offset declines in sales of systems and consumables of 100% and 71%, respectively, compared to the prior year period.

Total sales for the first half of 2020 were €2.1 million, down 47% year-over-year. First half of 2020 sales results were driven by a 7% increase in services revenue, which partially offset declines in sales of systems and consumables of 59% and 52%, respectively, compared to the prior year period.

Second Quarter and First Half of 2020 Sales by Geography with split by activity (Clinical / Pre-clinical)

(in € thousands) –
IFRS

 

Q2
2020

Q2
2019

% Chg.
Y/Y

6
Months
2020

6
Months
2019

% Chg.
Y/Y

U.S. & Canada

 

487

917

(47%)

1,321

1,629

(19%)

Clinical

 

478

916

(48%)

1,309

1,612

(19%)

Pre-clinical

 

9

1

841%

12

17

(31%)

Asia-Pacific

 

47

947

(95%)

519

1,497

(65%)

Clinical

 

41

941

(96%)

512

1,491

(66%)

Pre-clinical

 

6

6

(4%)

7

6

14%

EMEA & ROW

 

92

357

(74%)

260

810

(68%)

Clinical

 

75

339

(78%)

228

675

(66%)

Pre-clinical

 

17

19

(10%)

32

135

(76%)

Total Clinical Sales

 

595

2,195

(73%)

2,049

3,778

(46%)

Total Pre-clinical Sales

 

32

26

24%

51

159

(68%)

Total Sales

 

627

2,221

(72%)

2,100

3,937

(47%)

Clinical Sales
Total clinical sales for the second quarter of 2020 were €0.6 million, down 73% year-over-year, driven primarily by a 95% decrease in sales in the Asia-Pacific region, a 47% decrease in the U.S. and Canada regions and a 74% decrease in sales in the EMEA and Rest of World regions.

Total clinical sales for the first half of 2020 period were €2 million, down 46% year-over-year, driven primarily by a 65% decrease in sales in the Asia-Pacific region, a 68% decrease in sales in the EMEA and Rest of World regions and a 19% decrease in sales in the U.S. and Canada regions.

Pre-Clinical Sales
Total pre-clinical sales were €32 thousand and €51 thousand in the second quarter and first half of 2020 periods, respectively, compared to €26 thousand and €159 thousand, respectively, in the prior year periods. The decrease in pre-clinical sales of 68% year-over-year in the first half of 2020 was driven by the Company’s strategic focus on clinical sales opportunities and, as stated in prior quarters, these sales are less recurring than clinical sales which presents difficult comparisons from one period to another.

Second Quarter and First Half of 2020 Units Sales by Type

Units (#)

Q2
2020

Q2
2019

% Chg.
Y/Y

6Mo
2020

6Mo
2019

% Chg.
Y/Y

New Systems Sold

0

9

(100%)

6

15

(60%)

New System Placements

2

3

(33%)

4

10

(60%)

Consumable Probe Shipments

43

266

(84%)

150

461

(67%)

Total Cellvizio System shipments decreased 84% year-over-year to 2 in the second quarter of 2020, compared to 12 total shipments in the prior year period. Second quarter of 2020 included 2 new system placements, in May, driven by the Company’s new, more targeted strategy for driving future adoption of Cellvizio in the U.S. GI market by focusing on the high-volume upper GI clinicians. Consumable probe shipments declined 84% year-over-year and 67% year-over-year in the second quarter and first half of 2020, respectively, as a result of the global pandemic.

●●●

Financial calendar
Please note that the 2020 financial calendar is available on the Mauna Kea Technologies website:
https://www.maunakeatech.com/en/investors/financial-calendar

About Mauna Kea Technologies
Mauna Kea Technologies is a global medical device company focused on eliminating uncertainties related to the diagnosis and treatment of cancer and other diseases thanks to real time in vivo microscopic visualization. The Company’s flagship product, Cellvizio®, has received clearance/approval for a wide range of applications in the United States and more than 40 countries around the World. For more information on Mauna Kea Technologies, visit www.maunakeatech.com

Disclaimer
This press release contains forward-looking statements concerning Mauna Kea Technologies and its activities. Such forward looking statements are based on assumptions that Mauna Kea Technologies considers to be reasonable. However, there can be no assurance that the anticipated events contained in such forward-looking statements will occur. Forward- looking statements are subject to numerous risks and uncertainties including the risks set forth in the registration document of Mauna Kea Technologies registered by the French Financial Markets Authority (Autorité des marchés financiers (AMF)) on July 12, 2019 under number D.19-0683 and available on the Company's website (www.maunakeatech.com), and to the development of economic situation, financial markets, and the markets in which Mauna Kea Technologies operates. The forward-looking statements contained in this release are also subject to risks unknown to Mauna Kea Technologies or that Mauna Kea Technologies does not consider material at this time. The realization of all or part of these risks could lead to actual results, financial conditions, performances or achievements by Mauna Kea Technologies that differ significantly from the results, financial conditions, performances or achievements expressed in such forward-looking statements. This press release and the information it contains do not constitute an offer to sell or to subscribe for, or a solicitation of an order to purchase or subscribe for, Mauna Kea Technologies shares in any country.

Contacts

United States
Mike Piccinino, CFA
Westwicke, an ICR Company
443-213-0500

France and Europe
NewCap - Investor Relations
Thomas Grojean
+33 (0)1 44 71 94 94
maunakea@newcap.eu

Contacts

United States
Mike Piccinino, CFA
Westwicke, an ICR Company
443-213-0500

France and Europe
NewCap - Investor Relations
Thomas Grojean
+33 (0)1 44 71 94 94
maunakea@newcap.eu