Organovo Announces Select Preliminary Second-Quarter 2017 Results; Company Updates Full-Year Fiscal 2017 Outlook
Organovo’s preliminary fiscal second quarter total revenue was approximately
Selected Organovo Financial Highlights
Revenue
- Product and service revenue was approximately
$1.0 million , up 400 percent from the prior-year period, largely driven by an increase in customer contracts for the Company’s tissue research services. - Collaborations and grant revenue(2) totaled approximately
$0.4 million , primarily supported by a milestone achievement from the Company’s agreement withMerck & Co. to develop multiple custom tissue models.
Liquidity & Capital Resources
- The Company’s preliminary cash and cash equivalents balance was approximately
$51.7 million as of the end of the fiscal second quarter, which compares to$53.5 million for the fiscal first quarter. Organovo’s preliminary net cash utilization(3) during the period was approximately$6.8 million . During the fiscal second quarter, the Company generated net proceeds of approximately$4.5 million from the issuance of 997,181 shares of common stock in at-the-market (“ATM”) offerings at a weighted average price of$4.67 per share and approximately$0.5 million from the exercise of stock options and warrants.
Fiscal-Year 2017 Outlook
The Company updated its full-year fiscal 2017 outlook for total revenue and net cash utilization. The Company now expects:
- Total revenue of between
$4.5 million and $6.2 million for fiscal-year 2017. Fiscal 2016 total revenue was$1.5 million . - Net cash utilization of between
$31.0 million and $34.0 million for fiscal-year 2017. The Company had a cash and cash equivalents balance of$62.1 million for its fiscal year endedMarch 31 , 2016.
Fiscal-Year 2017 Outlook (August 2016) |
Fiscal-Year 2017 Outlook (October 2016) |
|
Fiscal-Year 2017 Total Revenue | $4 million - $6 million | $4.5 million - $6.2 million |
Net Cash Utilization | $32.5 million - $36.5 million | $31.0 million - $34.0 million |
Long-Range Outlook
The Company affirmed its long-range outlook for potential revenue from its liver and kidney tissue products. The Company continues to expect:
- As it penetrates the toxicology market, Organovo’s ExVive™ Human Liver Tissue service will grow into the tens of millions in annual revenue, and has $100 million+ revenue potential in the future (inside of a total addressable market of over
$1 billion ). - As it penetrates the toxicology market, Organovo’s ExVive Human Kidney Tissue service will grow into the tens of millions in annual revenue, and has $100 million+ revenue potential in the future (inside of a total addressable market of over
$2 billion ).
Definitions & Supplemental Financial Measures
(1) Product and service revenue includes tissue research service agreements and product sales, including product sales from the Company’s wholly-owned subsidiary,
(2) Collaborations revenue consists of license and collaboration agreements that contain multiple elements, which may include non-refundable up-front fees, payments for reimbursement of third-party research costs, payments for ongoing research, payments associated with achieving specific development milestones and royalties based on specified percentages of net product sales, if any.
(3) In addition to disclosing financial results that are determined in accordance with U.S. GAAP, the Company provides net cash utilization as a supplemental measure to help investors evaluate the Company’s fundamental operational performance. The Company defines net cash utilization as the net decrease in cash and cash equivalents during the reporting period (which was (
About
Organovo designs and creates functional, three-dimensional human tissues for use in medical research and therapeutic applications. The Company develops 3D human tissue models through internal development and in collaboration with pharmaceutical, academic and other partners.
Forward-Looking Statements
Any statements contained in this press release that do not describe historical facts constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Any forward-looking statements contained herein are based on current expectations, but are subject to a number of risks and uncertainties. Forward-looking statements include, but are not limited to, statements regarding the Company’s select preliminary financial results for the second quarter of fiscal year 2017, the Company’s fiscal year 2017 outlook and the Company’s long-range outlook. The Company’s select quarterly financial results for the second quarter of fiscal year 2017 are preliminary and subject to adjustments in the ongoing review by the Company and its external auditors. The factors that could cause the Company’s actual future results to differ materially from current expectations include, but are not limited to, risks and uncertainties relating to the Company’s ability to develop, market and sell products and services based on its technology; the expected benefits and efficacy of the Company’s products, services and technology; the market acceptance of the Company’s products and services; the Company’s business, research, product development, regulatory approval, marketing and distribution plans and strategies; the Company’s ability to successfully complete the contracts and recognize the revenue represented by the contracts included in its previously reported total contract bookings; the Company’s ability to secure additional contracted collaborative relationships; the risk of further adjustments to the Company’s select preliminary financial results; and the Company’s ability to meet its fiscal year 2017 outlook and/or its long-range outlook. These and other factors are identified and described in more detail in the Company’s filings with the SEC, including its Annual Report on Form 10-K filed with the SEC on June 9, 2016 and its Quarterly Report on Form 10-Q filed with the
Investor Contact:Steve Kunszabo Organovo Holdings, Inc. +1 (858) 224-1092 skunszabo@organovo.com Press Contact:Jessica Yingling Little Dog Communications +1 (858) 344-8091 jessica@litldog.com