LEXINGTON, Massachusetts, United States and SYDNEY, Australia–(BUSINESS WIRE)–GI Dynamics, Inc. (ASX: GID) (GI Dynamics or the Company), a medical device company developing innovative treatments for type 2 diabetes and obesity, is pleased to provide its financial results for the quarter ended 31 March 2015 (Quarter). The Appendix 4C, which has been prepared in U.S. dollars under U.S. GAAP, is attached and the results disclosed in the Appendix 4C are unaudited.
The Company plans to file its Quarterly Report on Form 10-Q (Form 10-Q) with the U.S. Securities and Exchange Commission and with the Australian Securities Exchange on or before 15 May 2015. The Form 10-Q will provide financial statements for the Quarter, along with Management’s Discussion and Analysis of Financial Condition and Results of Operations for the Quarter.
At the recommendation of the FDA, the Company has discontinued placing any additional devices in its U.S. pivotal clinical trial of EndoBarrier Therapy (the ENDO Trial); although monitoring and data collection of the 325 currently enrolled subjects continues. The Company has already implemented several risk mitigation strategies in the ENDO Trial and is preparing to submit the information requested by the FDA for their review.
The Company’s key financial results for the Quarter include the following:
- Revenue decreased to US$0.6 million for the Quarter compared to US$0.9 million for the same period last year, a decrease of US$0.3 million. The decrease in the Company’s revenue in the Quarter compared to the same period last year was a result of a decrease in sales across all markets. Compared to the fourth quarter of 2014, revenue increased US$0.1 million due to increased sales in Europe and the Middle East.
- Cost of revenue for the Quarter and same period last year was US$0.9 million. The Quarter experienced decreased manufacturing efficiency due to lower production volume compared to the same period last year. As a result, gross loss increased by US$0.3 million for the Quarter.
- Operating expenses decreased to US$9.6 million for the Quarter compared to US$10.1 million for the same period last year, a decrease of US$0.5 million.
- Research and development expenses were US$5.6 million for the Quarter compared to US$5.3 million for the same period last year, an increase of US$0.3 million. The increase in research and development expenses for the Quarter was primarily a result of increased expenses to support the ENDO Trial and increased consulting expenses. These were partially offset by a decrease in personnel related costs.
- Sales and marketing expenses were US$1.7 million for the Quarter compared to US$2.5 million for the same period last year, a decrease of US$0.8 million. The decrease in sales and marketing expenses for the Quarter compared to the same period last year was the result of lower spending on marketing related activities to support the Company’s commercialization effort as well as lower personnel related costs, particularly share-based compensation.
- General and administrative expenses were US$2.3 million for the Quarter and the same period last year.
- Other income (expense) for the Quarter was a US$0.5 million loss compared to a gain of US$0.4 million for the same period last year, a decrease of US$0.9 million. The decrease in the Quarter compared to the same period last year was primarily associated with a US$0.5 million foreign exchange loss due to the depreciation of the Australian dollar versus the U.S. dollar during the Quarter as compared to a US$0.2 million foreign exchange gain in the same period last year as a result of a stronger Australian dollar. Additionally, in the first quarter of 2014 the Company had a US$0.2 million gain on the remeasurement of the warrant liability while in the Quarter it had a minimal loss on remeasurement.
- As a result, the Company recorded a net loss of US$10.3 million for the Quarter compared to US$9.7 million for the same period last year, an increase of US$0.6 million.
- The Company had cash and cash equivalents of US$40.0 million at 31 March 2015 compared to US$51.2 million at 31 December 2014, a decrease of US$11.2 million.
****************CONFERENCE CALL & WEBCAST INFORMATION****************
GI Dynamics, Inc. (ASX: GID) will hold a conference call to discuss the Company’s financial results for the quarter ended 31 March 2015, and its business outlook. Michael Dale, president and chief executive officer, will host the call.
The briefing call to discuss financial results and business outlook will be held at 6 p.m. U.S. EDT on Tuesday, 5 May 2015 (8 a.m. AEST on Wednesday, 6 May 2015).
Accessing the Briefing Call via Webcast:
A live webcast of the call will be available on the GI Dynamics website at investor.gidynamics.com. The webcast can be directly accessed at: http://edge.media-server.com/m/p/hccn2odi/lan/en.
Accessing the Briefing Call via Telephone:
For those preferring to listen by telephone, please dial in five minutes prior to the start of the call and provide the passcode 39430802. Regional dial-in numbers are as follows:
- United States callers please dial toll-free 1 (888) 771-4371
- Australia callers please dial toll-free 1 (800) 507-265
- International callers please dial 1 (847) 585-4405
The webcast will be archived for 30 days following the call on the GI Dynamics website at investor.gidynamics.com.
Vice President of Finance & Company Secretary