Veracyte, Inc. (Nasdaq: VCYT) today announced financial results for the third quarter ended September 30, 2021.
“We are pleased with our third quarter performance as we experienced strong year-over-year revenue growth despite the headwind of the COVID-19 Delta variant,” said Marc Stapley, Veracyte’s chief executive officer. “With the completion of our acquisition of HalioDx, the launch of our novel noninvasive Percepta Nasal Swab test for early lung cancer risk assessment and of our Decipher Bladder test to help guide bladder cancer treatment decisions, the pieces are coming together to transform our company into a global cancer diagnostics leader.”
Third Quarter 2021 Financial Results
For the third quarter of 2021, as compared with the third quarter of 2020:
For the nine months ended September 30, 2021, compared to the prior year:
Third Quarter 2021 and Recent Business Highlights
Commercial Growth:
Evidence Development and Guideline Inclusion:
Pipeline Advancement:
HalioDx Acquisition:
2021 Financial Outlook
Veracyte is updating its 2021 annual total revenue guidance to $210 million to $218 million, from the previous guidance range of $200 million to $208 million, with HalioDx expecting to contribute approximately $10 million. This range represents 79% to 86% total revenue growth for fiscal 2021 compared to fiscal 2020.
Conference Call and Webcast Details
Veracyte will host a conference call and webcast today at 4:30 p.m. Eastern Time to discuss the company's financial results and provide a general business update. The conference call will be webcast live from the company’s website and will be available via the following link: https://edge.media-server.com/mmc/p/3rcxuu6u. The webcast should be accessed 10 minutes prior to the conference call start time. A replay of the webcast will be available for one year following the conclusion of the live broadcast and will be accessible on the company’s website at https://investor.veracyte.com/events-presentations.
The conference call can be accessed as follows:
U.S./Canada participant dial-in number (toll-free): |
(855) 541-0980 |
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International participant dial-in number: |
(970) 315-0440 |
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Conference I.D.: |
9065288 |
About Veracyte
Veracyte (Nasdaq: VCYT) is a global diagnostics company that improves patient care by providing answers to clinical questions, informing diagnosis and treatment decisions throughout the patient journey in cancer and other diseases. The company’s growing menu of diagnostic tests leverages advances in genomic science and technology, enabling patients to avoid risky, costly diagnostic procedures and quicken time to appropriate treatment. The company’s tests in lung cancer, prostate cancer, breast cancer, thyroid cancer, bladder cancer, colon cancer, and idiopathic pulmonary fibrosis are available to patients and its renal cancer and lymphoma subtyping tests are in development, the latter as a companion diagnostic. With Veracyte’s exclusive global license to a best-in-class diagnostics instrument platform, the company is positioned to deliver its genomic tests to patients worldwide. Veracyte is based in South San Francisco, California. For more information, please visit www.veracyte.com and follow the company on Twitter (@veracyte).
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements, including, but not limited to, our statements related to our expected total revenue and other financial and operating results for 2021 and our plans, objectives, expectations (financial and otherwise) or intentions with respect to our Prosigna, Afirma, Percepta, Envisia, LymphMark, Decipher Prostate, Percepta Nasal Swab, Percepta Genomic Atlas and Decipher Bladder test and products for use in diagnosing and treating diseases, Medicare coverage, and our commercial organization. Forward-looking statements can be identified by words such as: “appears,” "anticipate," "intend," "plan," "expect," "believe," "should," "may," "will," “positioned,” “designed” and similar references to future periods. Actual results may differ materially from those projected or suggested in any forward-looking statements. These statements involve risks and uncertainties, which could cause actual results to differ materially from our predictions, and include, but are not limited to Veracyte’s ability to launch, commercialize and receive reimbursement for our products, to successfully integrate the HalioDx and Decipher Biosciences businesses and execute on our business plans; and the performance and utility of Veracyte’s tests in the clinical environment. Additional factors that may impact these forward-looking statements can be found under the caption “Risk Factors” in our Annual Report on Form 10-K filed with the SEC on February 22, 2021 and our subsequent quarterly reports on Form 10-Q. Copies of these documents can be found at the Investors section of our website at www.veracyte.com. The risks and uncertainties may be amplified by the COVID-19 pandemic, which has caused significant economic uncertainty. The extent to which the COVID-19 pandemic impacts Veracyte’s businesses, operations, and financial results, including the duration and magnitude of such effects, will depend on numerous factors, which are unpredictable, including, but not limited to, the duration and spread of the outbreak, its severity, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume. These forward-looking statements speak only as of the date hereof and, except as required by law, Veracyte specifically disclaims any obligation to update these forward-looking statements or reasons why actual results might differ, whether as a result of new information, future events or otherwise.
Veracyte, the Veracyte logo, HalioDx, Brightplex, Decipher, Decipher GRID, Afirma, Percepta, Envisia, Prosigna, Lymphmark, “Know by Design” and “More about You” are registered trademarks of Veracyte, Inc. and its affiliates in the U.S. and selected countries. nCounter is the registered trademark of NanoString Technologies, Inc. in the U.S. and selected countries, and used by Veracyte under license. Immunoscore is the registered trademark of Inserm in the U.S. and selected countries, and is used by HalioDx under license.
VERACYTE, INC. |
|||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In thousands of dollars, except share and per share amounts) |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Revenues:(1) |
|
|
|
|
|
|
|
||||||||
Testing revenue |
$ |
50,897 |
|
|
$ |
28,270 |
|
|
$ |
134,768 |
|
|
$ |
70,473 |
|
Product revenue |
2,959 |
|
|
2,027 |
|
|
8,706 |
|
|
7,149 |
|
||||
Biopharmaceutical and other revenue |
6,514 |
|
|
824 |
|
|
8,704 |
|
|
5,325 |
|
||||
Total revenue |
60,370 |
|
|
31,121 |
|
|
152,178 |
|
|
82,947 |
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating Expenses:(1)(2) |
|
|
|
|
|
|
|
||||||||
Cost of testing revenue |
16,073 |
|
|
9,118 |
|
|
42,494 |
|
|
26,157 |
|
||||
Cost of product revenue |
1,491 |
|
|
1,048 |
|
|
4,304 |
|
|
3,539 |
|
||||
Cost of biopharmaceutical and other revenue |
4,079 |
|
|
204 |
|
|
4,720 |
|
|
572 |
|
||||
Research and development |
8,006 |
|
|
4,042 |
|
|
19,591 |
|
|
12,618 |
|
||||
Selling and marketing |
21,670 |
|
|
10,955 |
|
|
57,628 |
|
|
39,240 |
|
||||
General and administrative |
20,749 |
|
|
8,546 |
|
|
82,504 |
|
|
24,316 |
|
||||
Intangible asset amortization |
4,983 |
|
|
1,274 |
|
|
10,507 |
|
|
3,822 |
|
||||
Total operating expenses |
77,051 |
|
|
35,187 |
|
|
221,748 |
|
|
110,264 |
|
||||
Loss from operations |
(16,681 |
) |
|
(4,066 |
) |
|
(69,570 |
) |
|
(27,317 |
) |
||||
Other income (loss), net |
1,202 |
|
|
(58 |
) |
|
(762 |
) |
|
452 |
|
||||
Loss before income tax benefit |
(15,479 |
) |
|
(4,124 |
) |
|
(70,332 |
) |
|
(26,865 |
) |
||||
Income tax benefit |
(1,350 |
) |
|
— |
|
|
(5,297 |
) |
|
— |
|
||||
Net loss |
$ |
(14,129 |
) |
|
$ |
(4,124 |
) |
|
$ |
(65,035 |
) |
|
$ |
(26,865 |
) |
Net loss per common share, basic and diluted |
$ |
(0.20 |
) |
|
$ |
(0.08 |
) |
|
$ |
(0.97 |
) |
|
$ |
(0.52 |
) |
Shares used to compute net loss per common share, basic and diluted |
69,743,733 |
|
|
54,858,052 |
|
|
66,820,654 |
|
|
51,632,750 |
|
(1) The financial results of HalioDx are included from the date of acquisition which contributed the following revenue and operating expenses for the three and nine months ended September 30, 2021:
Revenues: |
|
||
Testing revenue |
$ |
75 |
|
Biopharmaceutical revenue |
4,645 |
|
|
Total revenue |
$ |
4,720 |
|
|
|
||
Operating Expenses: |
|
||
Cost of testing revenue |
$ |
269 |
|
Cost of biopharmaceutical revenue |
3,735 |
|
|
Research and development |
1,201 |
|
|
Selling and marketing |
1,508 |
|
|
General and administrative |
3,568 |
|
|
Intangible asset amortization |
1,259 |
|
|
Other income (loss), net |
(526 |
) |
|
Total operating expenses |
$ |
11,014 |
|
(2) Cost of revenue, research and development, sales and marketing and general and administrative expenses include the following stock-based compensation related expenses:
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||
HalioDx stock-based compensation expense |
2,567 |
|
|
— |
|
|
2,567 |
|
|
— |
|
Other stock-based compensation expense |
5,667 |
|
|
3,090 |
|
|
13,587 |
|
|
9,354 |
|
Total stock-based compensation expense |
8,234 |
|
|
3,090 |
|
|
16,154 |
|
|
9,354 |
|
VERACYTE, INC. |
|||||||||||||||
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS |
|||||||||||||||
(Unaudited) |
|||||||||||||||
(In thousands) |
|||||||||||||||
|
|
|
|
|
|
|
|
||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
Net loss |
$ |
(14,129 |
) |
|
$ |
(4,124 |
) |
|
$ |
(65,035 |
) |
|
$ |
(26,865 |
) |
Other comprehensive loss: |
|
|
|
|
|
|
|
||||||||
Change in currency translation adjustments |
(8,140 |
) |
|
— |
|
|
(8,140 |
) |
|
— |
|
||||
|
|
|
|
|
|
|
|
||||||||
Net comprehensive loss |
$ |
(22,269 |
) |
|
$ |
(4,124 |
) |
|
$ |
(73,175 |
) |
|
$ |
(26,865 |
) |
VERACYTE, INC. |
|||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
(In thousands) |
|||||||
|
|
|
|
||||
|
September 30, 2021 |
|
December 31, 20201 |
||||
|
(Unaudited) |
|
|
||||
Assets |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
164,029 |
|
|
$ |
349,364 |
|
Accounts receivable |
40,309 |
|
|
18,461 |
|
||
Supplies |
9,824 |
|
|
4,657 |
|
||
Prepaid expenses and other current assets |
15,146 |
|
|
3,197 |
|
||
Total current assets |
229,308 |
|
|
375,679 |
|
||
Property and equipment, net |
14,868 |
|
|
8,990 |
|
||
Right-of-use assets, operating lease |
16,001 |
|
|
7,843 |
|
||
Intangible assets, net |
209,521 |
|
|
59,924 |
|
||
Goodwill |
714,273 |
|
|
2,725 |
|
||
Restricted cash |
749 |
|
|
603 |
|
||
Other assets |
1,636 |
|
|
1,399 |
|
||
Total assets |
$ |
1,186,356 |
|
|
$ |
457,163 |
|
Liabilities and Stockholders’ Equity |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable |
$ |
11,201 |
|
|
$ |
3,116 |
|
Accrued liabilities |
29,044 |
|
|
11,705 |
|
||
Current portion of deferred revenue |
3,440 |
|
|
371 |
|
||
Current portion of acquisition-related contingent consideration |
2,646 |
|
|
— |
|
||
Current portion of operating lease liability |
3,465 |
|
|
1,589 |
|
||
Current portion of other liabilities |
241 |
|
|
— |
|
||
Total current liabilities |
50,037 |
|
|
16,781 |
|
||
Long-term debt |
1,075 |
|
|
810 |
|
||
Deferred revenue, net of current portion |
552 |
|
|
829 |
|
||
Deferred tax liability |
6,234 |
|
|
— |
|
||
Acquisition-related contingent consideration, net of current portion |
5,251 |
|
|
7,594 |
|
||
Operating lease liability, net of current portion |
14,236 |
|
|
9,917 |
|
||
Other liabilities |
1,891 |
|
|
— |
|
||
Total liabilities |
79,276 |
|
|
35,931 |
|
||
Total stockholders’ equity |
1,107,080 |
|
|
421,232 |
|
||
Total liabilities and stockholders’ equity |
$ |
1,186,356 |
|
|
$ |
457,163 |
|
|
|
|
|
||||
1 The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date included in the Company's Form 10-K filed with the Securities and Exchange Commission dated February 22, 2021. |
VERACYTE, INC. |
|||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||
(Unaudited) |
|||||||
(in thousands of dollars) |
|||||||
|
|
|
|
||||
|
Nine Months Ended September 30, |
||||||
|
2021 |
|
2020 |
||||
Operating activities |
|
|
|
||||
Net loss |
$ |
(65,035 |
) |
|
$ |
(26,865 |
) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
||||
Depreciation and amortization |
13,189 |
|
|
5,919 |
|
||
Stock-based compensation |
15,787 |
|
|
9,354 |
|
||
Benefit from income taxes |
(5,297 |
) |
|
— |
|
||
Interest on end-of-term debt obligation |
161 |
|
|
162 |
|
||
Write-down of excess supplies |
— |
|
|
1,088 |
|
||
Noncash lease expense |
1,566 |
|
|
714 |
|
||
Revaluation of acquisition-related contingent consideration |
303 |
|
|
332 |
|
||
Effect of foreign currency on operations |
1,601 |
|
|
(17 |
) |
||
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
(6,285 |
) |
|
1,742 |
|
||
Supplies |
4 |
|
|
1,262 |
|
||
Prepaid expenses and other current assets |
(1,905 |
) |
|
(923 |
) |
||
Other assets |
353 |
|
|
134 |
|
||
Operating lease liability |
(1,710 |
) |
|
(1,040 |
) |
||
Accounts payable |
3,872 |
|
|
(534 |
) |
||
Accrued liabilities and deferred revenue |
3,329 |
|
|
(3,300 |
) |
||
Net cash used in operating activities |
(40,067 |
) |
|
(11,972 |
) |
||
Investing activities |
|
|
|
||||
Acquisition of Decipher Biosciences, net of cash acquired |
(574,411 |
) |
|
— |
|
||
Acquisition of HalioDx, net of cash acquired |
(163,645 |
) |
|
— |
|
||
Proceeds from sale of equity securities |
3,000 |
|
|
— |
|
||
Purchase of equity securities |
— |
|
|
(1,000 |
) |
||
Purchases of property and equipment |
(4,535 |
) |
|
(1,949 |
) |
||
Net cash used in investing activities |
(739,591 |
) |
|
(2,949 |
) |
||
Financing activities |
|
|
|
||||
Proceeds from the issuance of common stock in a public offering, net of issuance costs |
593,821 |
|
|
193,831 |
|
||
Payment of long-term debt |
— |
|
|
(100 |
) |
||
Payment of taxes on vested restricted stock units |
(8,307 |
) |
|
(3,161 |
) |
||
Proceeds from the exercise of common stock options and employee stock purchases |
10,633 |
|
|
10,114 |
|
||
Net cash provided by financing activities |
596,147 |
|
|
200,684 |
|
||
(Decrease) increase in cash, cash equivalents and restricted cash |
(183,511 |
) |
|
185,763 |
|
||
Effect of foreign currency on cash, cash equivalents and restricted cash |
(1,678 |
) |
|
— |
|
||
Net (decrease) increase in cash, cash equivalents and restricted cash |
(185,189 |
) |
|
185,763 |
|
||
Cash, cash equivalents and restricted cash at beginning of period |
349,967 |
|
|
159,920 |
|
||
Cash, cash equivalents and restricted cash at end of period |
$ |
164,778 |
|
|
$ |
345,683 |
|
|
|
|
|
||||
Supplementary cash flow information: |
|
|
|
||||
Purchases of property and equipment included in accounts payable and accrued liability |
$ |
31 |
|
|
$ |
355 |
|
Interest paid on debt |
$ |
9 |
|
|
$ |
3 |
|
Issuance of common stock for acquisition of HalioDx |
$ |
147,089 |
|
|
$ |
— |
|
CASH, CASH EQUIVALENTS AND RESTRICTED CASH |
|||||||
(Unaudited) |
|||||||
(In thousands of dollars) |
|||||||
|
|
|
|
||||
|
September 30, |
|
December 31, |
||||
|
2021 |
|
2020 |
||||
Cash and cash equivalents |
$ |
164,029 |
|
|
$ |
349,364 |
|
Restricted cash |
749 |
|
|
603 |
|
||
Total cash, cash equivalents and restricted cash |
$ |
164,778 |
|
|
$ |
349,967 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20211109006376/en/
Investor and Media Contact:
Tracy Morris
Vice President of Corporate Communications & Investor Relations
650-380-4413
[email protected]