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BrainsWay Reports Second Quarter 2022 Financial Results and Operational Highlights

·11-min read
BrainsWay
BrainsWay

Revenue Growth of 14% Year-over-Year in Q2 2022

Conference call to be held today, August 10, 2022, at 8:30 AM ET

BURLINGTON, Mass. and JERUSALEM, Aug. 10, 2022 (GLOBE NEWSWIRE) -- BrainsWay Ltd. (NASDAQ & TASE: BWAY) (“BrainsWay” or the “Company”), a world leader in advanced and non-invasive treatment for brain disorders, today reported second quarter 2022 financial results and provided an operational update.

Recent Financial and Operational Highlights

  • For the three months ended June 30, 2022, revenues were $8.0 million, a 14% increase as compared to the prior year period.

  • As of June 30, 2022, BrainsWay’s Deep TMS™ installed base was 829 total systems, a 22% increase from the installed base at the same point in the prior year.

  • As of June 30, 2022, the Company had shipped 368 obsessive-compulsive disorder (OCD) coils as add-on helmets to certain of BrainsWay’s new and existing systems.

  • Cash, cash equivalents and short-term deposits as of June 30, 2022, amounted to $52.4 million, compared to $57.3 million as of December 31, 2021.

  • Announced that Highmark Blue Cross Blue Shield (BCBS), which covers 6.8 million members in the states of New York, Pennsylvania, West Virginia, and Delaware, and is the fourth largest BCBS health plan in the U.S., issued a positive coverage policy applicable to the BrainsWay Deep TMS system for the treatment of OCD, effective May 2, 2022.

  • Israeli Ministry of Health approved coverage applicable to Deep TMS for the treatment of depression.

“We recorded solid second quarter results, again reflecting the growing demand for our non-invasive therapy in multiple indications and markets, despite certain macroeconomic challenges impacting existing and potential new customers,” stated Christopher von Jako, Ph.D., President and Chief Executive Officer of BrainsWay. “We generated $8.0 million in revenue for the second quarter of 2022, which represented a 14% increase as compared to the second quarter of 2021, our eighth consecutive quarter of year-over-year growth. These results are especially impressive as the team faced the realities of inflation and concerns over an economic recession in the U.S. from our customers and their patients.”

“We also continue to achieve important reimbursement progress, highlighted by the recent Highmark BCBS positive coverage policy in OCD that increased the total number of lives eligible for Deep TMS coverage in this indication to nearly 70 million.”

“Given the increasing demand for mental healthcare, we believe that Deep TMS is well positioned to grow versus other non-invasive medical technology and pharmaceutical therapy options. With approved indications for Depression (including Anxious Depression), OCD, and Smoking Addiction, and data from 34 randomized clinical trials, many of which were placebo controlled, no other TMS therapy can equal the depth of the clinical evidence reinforcing the significant benefits of our Deep TMS system,” concluded Dr. von Jako.

Second Quarter 2022 Financial Results

  • Total revenues for the second quarter of 2022 were $8.0 million, compared to $7.0 million in the second quarter of 2021, an increase of 14%.

  • Gross margin for the second quarter of 2022 was 73%, compared to 81% for the second quarter 2021, largely attributable to expenses related to inventory obsolescence and a higher mix of international sales.

  • Operating expenses for the second quarter of 2022 totaled $7.8 million, compared to $7.2 million for the second quarter of 2021.

  • Operating loss for the second quarter of 2022 was $2.0 million, compared to a loss of $1.5 million for the same period in 2021.

Conference Call and Webcast

BrainsWay’s management will host a conference call on Wednesday, August 10, 2022, at 8:30 a.m. Eastern Time to discuss these results and answer questions.

Wednesday, August 10, 2022, at 8:30 AM Eastern Time:

United States:

1-877-407-3982

International:

1-201-493-6780

Conference ID:

13731331

Webcast:

https://viavid.webcasts.com/starthere.jsp?ei=1558822&tp_key=74e2e8e62b

To listen to a live webcast, please visit the Investors section of the BrainsWay website at www.BrainsWay.com. Please access the Company’s website at least 10 minutes ahead of the conference call to register. The webcast replay will be available on the website for two weeks following the completion of the call.

About BrainsWay
BrainsWay is a global leader in advanced noninvasive neurostimulation treatments for mental health disorders. The Company is boldly advancing neuroscience with its proprietary Deep Transcranial Magnetic Stimulation (Deep TMS™) platform technology to improve health and transform lives. BrainsWay is the first and only TMS company to obtain three FDA-cleared indications backed by pivotal studies demonstrating clinically proven efficacy. Current indications include major depressive disorder (including reduction of anxiety symptoms, commonly referred to as anxious depression), obsessive-compulsive disorder, and smoking addiction. The Company is dedicated to leading through superior science and building on its unparalleled body of clinical evidence. Additional clinical trials of Deep TMS in various psychiatric, neurological, and addiction disorders are underway. Founded in 2003, with offices in Burlington, MA and Jerusalem, Israel, BrainsWay is committed to increasing global awareness of and broad access to Deep TMS. For the latest news and information about BrainsWay, please visit www.BrainsWay.com.

Forward-Looking Statement
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. These forward-looking statements and their implications are based on the current expectations of the management of the Company only and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. In addition, historical results or conclusions from scientific research and clinical studies do not guarantee that future results would suggest similar conclusions or that historical results referred to herein would be interpreted similarly in light of additional research or otherwise. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: inadequacy of financial resources to meet future capital requirements; changes in technology and market requirements; delays or obstacles in launching and/or successfully completing planned studies and clinical trials; failure to obtain approvals by regulatory agencies on the Company’s anticipated timeframe, or at all; inability to retain or attract key employees whose knowledge is essential to the development of Deep TMS products; unforeseen difficulties with Deep TMS products and processes, and/or inability to develop necessary enhancements; unexpected costs related to Deep TMS products; failure to obtain and maintain adequate protection of the Company’s intellectual property, including intellectual property licensed to the Company; the potential for product liability; changes in legislation and applicable rules and regulations; unfavorable market perception and acceptance of Deep TMS technology; inadequate or delays in reimbursement from third-party payers, including insurance companies and Medicare; inability to commercialize Deep TMS, including internationally, by the Company or through third-party distributors; product development by competitors; inability to timely develop and introduce new technologies, products and applications, which could cause the actual results or performance of the Company to differ materially from those contemplated in such forward-looking statements.

Any forward-looking statement in this press release speaks only as of the date of this press release. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable securities laws. More detailed information about the risks and uncertainties affecting the Company is contained under the heading “Risk Factors” in the Company’s filings with the U.S. Securities and Exchange Commission.

Contacts:
BrainsWay:
Scott Areglado
SVP and Chief Financial Officer
844-386-7001
Scott.Areglado@BrainsWay.com

Investors:
Bob Yedid
LifeSci Advisors
646-597-6989
Bob@LifeSciAdvisors.com



BRAINSWAY LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

U.S. dollars in thousands

 

 

 

 

 

 

 

June 30,

 

December 31,

 

 

2022

 

2021

ASSETS

 

(Unaudited)

Current Assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

52,174

 

 

$

16,921

 

Short-term deposits

 

 

271

 

 

 

40,428

 

Trade receivables, net

 

 

7,412

 

 

 

6,332

 

Inventory

 

 

2,311

 

 

 

-

 

Other current assets

 

 

1,557

 

 

 

1,766

 

 

 

 

63,725

 

 

 

65,447

 

Non-Current Assets

 

 

 

 

 

 

 

 

System components

 

 

2,458

 

 

 

4,463

 

Leased systems, net

 

 

3,557

 

 

 

3,813

 

Other property and equipment, net

 

 

1,019

 

 

 

1,055

 

Other long-term assets

 

 

999

 

 

 

954

 

 

 

 

8,033

 

 

 

10,285

 

 

 

$

71,758

 

 

$

75,732

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

Current Liabilities

 

 

 

 

 

 

 

 

Trade payables

 

$

1,658

 

 

$

1,102

 

Deferred revenue

 

 

1,972

 

 

 

2,195

 

Liability in respect of research and development grants

 

 

1,011

 

 

 

978

 

Other accounts payable

 

 

3,625

 

 

 

4,792

 

 

 

 

8,266

 

 

 

9,067

 

Non-Current Liabilities

 

 

 

 

 

 

 

 

Deferred revenue and other liabilities

 

 

3,883

 

 

 

3,419

 

Liability in respect of research and development grants

 

 

5,946

 

 

 

5,921

 

 

 

 

9,829

 

 

 

9,340

 

 

 

 

 

 

 

 

 

 

Equity

 

 

 

 

 

 

 

 

Share capital

 

 

363

 

 

 

363

 

Share premium

 

 

137,904

 

 

 

137,566

 

Share-based payment reserve

 

 

5,783

 

 

 

5,340

 

Currency Translation Adjustments

 

 

(2,188

)

 

 

(2,188

)

Accumulated deficit

 

 

(88,199

)

 

 

(83,756

)

 

 

 

53,663

 

 

 

57,325

 

 

 

$

71,758

 

 

$

75,732

 



BRAINSWAY LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

U.S. dollars in thousands (except per share data)

 

 

 

 

 

 

 

 

 

 

 

For the three months ended June 30,

 

For the six months ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

 

 

(Unaudited)

 

(Unaudited)

Revenues

 

$

8,006

 

 

$

7,005

 

 

$

15,976

 

 

$

13,126

 

Cost of revenues

 

 

2,192

 

 

 

1,300

 

 

 

4,059

 

 

 

2,763

 

Gross profit

 

 

5,814

 

 

 

5,705

 

 

 

11,917

 

 

 

10,363

 

 

 

 

 

 

 

 

 

 

Research and development expenses, net

 

 

1,731

 

 

 

1,650

 

 

 

3,307

 

 

 

2,575

 

Selling and marketing expenses

 

 

4,552

 

 

 

4,191

 

 

 

8,698

 

 

 

7,320

 

General and administrative expenses

 

 

1,539

 

 

 

1,377

 

 

 

3,402

 

 

 

2,782

 

Total operating expenses

 

 

7,822

 

 

 

7,218

 

 

 

15,407

 

 

 

12,677

 

 

 

 

 

 

 

 

 

 

Operating loss

 

 

(2,008

)

 

 

(1,513

)

 

 

(3,490

)

 

 

(2,314

)

 

 

 

 

 

 

 

 

 

Finance expense, net

 

 

(329

)

 

 

(269

)

 

 

(653

)

 

 

(681

)

Loss before income taxes

 

 

(2,337

)

 

 

(1,782

)

 

 

(4,143

)

 

 

(2,995

)

Income taxes

 

 

113

 

 

 

156

 

 

 

300

 

 

 

316

 

Net loss and total comprehensive loss

 

$

(2,450

)

 

$

(1,938

)

 

$

(4,443

)

 

$

(3,311

)

 

 

 

 

 

 

 

 

 

Basic and diluted net loss per share

 

$

(0.07

)

 

$

(0.06

)

 

$

(0.13

)

 

$

(0.11

)


BRAINSWAY LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

U.S. dollars in thousands

 

 

 

 

 

 

 

 

 

 

 

For the three months ended June 30,

 

For the six months ended June 30,

 

 

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

 

 

(Unaudited)

 

(Unaudited)

Cash flows from operating activities:

 

 

 

 

 

 

 

 

Total comprehensive loss

 

$

(2,450

)

 

$

(1,938

)

 

$

(4,443

)

 

$

(3,311

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

 

Adjustments to profit or loss items:

 

 

 

 

 

 

 

 

Depreciation and amortization

 

 

154

 

 

 

131

 

 

 

296

 

 

 

281

 

Depreciation of leased systems

 

 

246

 

 

 

288

 

 

 

491

 

 

 

580

 

Impairments and disposals

 

 

301

 

 

 

227

 

 

 

233

 

 

 

480

 

Finance expenses, net

 

 

329

 

 

 

269

 

 

 

653

 

 

 

681

 

Cost of share based payment

 

 

408

 

 

 

280

 

 

 

782

 

 

 

1,083

 

Income taxes

 

 

113

 

 

 

156

 

 

 

300

 

 

 

316

 

Total adjustments to reconcile loss

 

 

1,551

 

 

 

1,351

 

 

 

2,755

 

 

 

3,421

 

Changes in asset and liability items:

 

 

 

 

 

 

 

 

Increase in trade receivables

 

 

(1,072

)

 

 

(38

)

 

 

(1,135

)

 

 

(1,131

)

Increase in inventory

 

 

(792

)

 

 

-

 

 

 

(2,105

)

 

 

-

 

Decrease in other accounts receivable

 

 

(257

)

 

 

(1,017

)

 

 

(318

)

 

 

(999

)

Increase (decrease) in trade payables

 

 

1,073

 

 

 

(377

)

 

 

561

 

 

 

(86

)

Increase (decrease) in other accounts payable

 

 

(384

)

 

 

12

 

 

 

(894

)

 

 

(200

)

Increase (decrease) in deferred revenues and other liabilities

 

 

(5

)

 

 

50

 

 

 

268

 

 

 

212

 

Total changes in asset and liability

 

 

(1,437

)

 

 

(1,370

)

 

 

(3,623

)

 

 

(2,204

)

Cash paid and received during the period for:

 

 

 

 

 

 

 

 

Interest paid

 

 

(11

)

 

 

(10

)

 

 

(23

)

 

 

(30

)

Interest received

 

 

304

 

 

 

-

 

 

 

307

 

 

 

2

 

Income taxes paid

 

 

(263

)

 

 

148

 

 

 

(266

)

 

 

(12

)

Total cash paid and received during the period

 

 

30

 

 

 

138

 

 

 

18

 

 

 

(40

)

Net cash used in operating activities:

 

 

(2,306

)

 

 

(1,819

)

 

 

(5,293

)

 

 

(2,134

)

 

 

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

Proceeds from (purchase of) property and equipment and system components, net

 

 

448

 

 

 

(538

)

 

 

1,399

 

 

 

(917

)

Investment in short-term deposits, net

 

 

40,304

 

 

 

(40,000

)

 

 

40,254

 

 

 

(40,000

)

Investment in long-term deposits, net

 

 

(2

)

 

 

(11

)

 

 

(5

)

 

 

(11

)

Net cash provided by (used in) investing activities

 

 

40,750

 

 

 

(40,549

)

 

 

41,648

 

 

 

(40,928

)

 

 

 

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

Repayment of liability in respect of research and development grants

 

 

-

 

 

 

(373

)

 

 

(498

)

 

 

(373

)

Receipt of government grants

 

 

-

 

 

 

77

 

 

 

6

 

 

 

167

 

Repayment of lease liability

 

 

(150

)

 

 

(227

)

 

 

(298

)

 

 

(227

)

Issuance of share capital, net

 

 

-

 

 

 

-

 

 

 

1

 

 

 

42,260

 

Net cash provided by (used in) financing activities

 

 

(150

)

 

 

(523

)

 

 

(789

)

 

 

41,827

 

Exchange rate differences on cash and cash equivalents

 

 

(225

)

 

 

207

 

 

 

(313

)

 

 

(130

)

 

 

 

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

 

 

38,069

 

 

 

(42,684

)

 

 

35,253

 

 

 

(1,365

)

Cash and cash equivalents at the beginning of the period

 

 

14,105

 

 

 

58,280

 

 

 

16,921

 

 

 

16,961

 

Cash and cash equivalents at the end of the period

 

$

52,174

 

 

$

15,596

 

 

$

52,174

 

 

$

15,596

 

 

 

 

 

 

 

 

 

 

(a) Significant non cash transactions:

 

 

 

 

 

 

 

 

Recognition of new lease liability and right-of-use

 

 

123

 

 

 

-

 

 

 

123

 

 

 

183