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Alimera Sciences Announces Third Quarter 2019 Financial Results and Provides Corporate Update

Third Quarter and Recent Company Highlights:

  • Consolidated Net Revenue Up 16% Compared to Third Quarter 2018

  • International Net Revenue Up 62% Compared to Third Quarter 2018

  • Launch of ILUVIEN® for Non-Infectious Posterior Uveitis in U.K. and Germany

  • Approval of ILUVIEN for Non-Infectious Posterior Uveitis Indication in Portugal

ATLANTA, Oct. 29, 2019 (GLOBE NEWSWIRE) -- Alimera Sciences, Inc. (ALIM) (Alimera), a leader in the commercialization and development of prescription ophthalmology treatments for the management of retinal diseases, announces financial results for the quarter ended September 30, 2019. Alimera will host a conference call on Wednesday, October 30, 2019 at 9:00 AM ET to review these financial results and provide an update on corporate developments.

“We are pleased to report consolidated revenue of $12.9 million for the third quarter of 2019, a 16% gain over the third quarter of last year and significant growth over the recently reported second quarter of 2019,” said Rick Eiswirth, President and CEO of Alimera. “Our international business contributed greatly to our growth, delivering a 62% increase in revenue on a combined basis, and our U.S. sales team, which was fully staffed, delivered increases in end user demand month-to-month during the quarter.”

Third Quarter 2019 Financial Results

Net Revenue

Consolidated net revenue for the third quarter of 2019 grew 16% to $12.9 million, compared to $11.1 million for the third quarter of 2018. U.S. net revenue was $8.7 million during the third quarter of 2019, up 2% from $8.5 million during the same period in 2018, and up 19% over the second quarter of 2019. End user demand, which represents units purchased by physicians and pharmacies from Alimera’s U.S. distributors, decreased slightly for the third quarter of 2019, to 973 units compared to 978 units from the third quarter of 2018, but increased sequentially from 917 units in the second quarter of 2019 after the sales force was fully staffed.

The discrepancy between GAAP revenue and end user demand in the U.S. is due to the timing of distributor purchases from quarter to quarter. In the third quarter of 2018, Alimera’s distributors purchased approximately 5% more units than they sold to end users, increasing their stock on hand during that quarter. In the third quarter of 2019, Alimera’s distributors purchased approximately 9% more units than they sold to end users, increasing their stock on hand during the quarter.

International net revenue increased 62% to approximately $4.2 million during the third quarter of 2019, compared to approximately $2.6 million for the same period during 2018, driven by increased unit sales across all markets. We expect revenue in the international segment to fluctuate from quarter to quarter depending primarily on the timing and size of our international distributor ordering patterns.

Operating Expenses
Total operating expenses for the third quarter of 2019 increased by $600,000 or 5% to $13.0 million, compared to $12.4 million during the same period of 2018. The increase was primarily attributable to an approximately $900,000 increase in sales and marketing expenses, partially offset by a $300,000 decrease in general and administrative expenses. The increase in sales and marketing expenses was due to increases in personnel costs and marketing costs, including those related to our direct-to-patient campaign.

Net Loss and Non-GAAP Adjusted EBITDA
For the third quarter of 2019, Alimera reported a net loss of approximately $3.1 million, compared to a net loss of $3.5 million for the same period in 2018. “Adjusted EBITDA,” a non-GAAP financial measure defined below, was a loss of approximately $500,000 for the third quarter of 2019, compared to a similar Adjusted EBITDA loss for the third quarter of 2018.

Net (Loss) Income per Share
Basic and diluted net loss per share for the third quarter of 2019 was $0.04 on approximately 71.0 million weighted average shares outstanding. This compares to basic net income per share for the third quarter of 2018 of $0.40 on approximately 88.0 million weighted average shares outstanding, which includes approximately 17.9 million participating securities. Diluted net income per share for the third quarter of 2018 was $0.39 on approximately 88.5 million weighted average shares outstanding, which includes approximately 18.5 million dilutive and participating securities. Net income available to stockholders for the third quarter of 2018 was primarily attributable to the gain on the extinguishment of Alimera’s Series B Convertible Preferred Stock resulting from its exchange in September 2018 for new Series C Convertible Preferred Stock.

Cash and Cash Equivalents
As of September 30, 2019, Alimera had cash and cash equivalents of approximately $7.9 million, compared to $13.0 million in cash and cash equivalents as of December 31, 2018.

On October 25, 2019, Alimera announced a $20.0 million equity purchase agreement with Lincoln Park Capital Fund, LLC. Under that agreement, Lincoln Park has purchased $1.0 million of Alimera’s registered common stock. This agreement will provide a flexible and efficient option to invest in Alimera’s current business to pursue strategies to leverage its global sales infrastructure and build a leading company focused on the treatment of retinal diseases.

Definition of Non-GAAP Financial Measure
For purposes of this press release, “Adjusted EBITDA” is defined as earnings before interest, taxes, depreciation, amortization, stock-based compensation expenses, net unrealized gains and losses from foreign currency exchange transactions, losses on extinguishment of debt and severance expenses. Please refer to the sections of this press release entitled “Non-GAAP Financial Measure” and “Reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA.”

Conference Call to Be Held October 30, 2019
A live conference call will be hosted on October 30, 2019 at 9:00am eastern time by Rick Eiswirth, president and chief executive officer, and Phil Jones, chief financial officer, to discuss Alimera’s financial results. Please refer to the information below for conference call dial-in information and webcast registration.

Conference date: Wednesday, October 30, 2019, 9:00 AM ET
Conference dial-in: 866-777-2509
International dial-in: 412-317-5413
Conference Call Name: Alimera Sciences (ALIM) Third Quarter 2019 Financial Results and Corporate Update Conference Call
Conference Call Pre-registration:
Participants can register for the conference by navigating to http://dpregister.com/10136395
Please note that registered participants will receive their dial in number upon registration and will dial directly into the call without delay.
Live Webcast URL: https://services.choruscall.com/links/alimera191030.html

A replay will be available on Alimera’s website, www.alimerasciences.com, under “Investor Relations” one hour following the live call.
Conference Call replay: US Toll Free: 1-877-344-7529
International Toll: 1-412-317-0088
Canada Toll Free: 855-669-9658
Replay Access Code: 10136395
End Date: November 13, 2019

About Alimera Sciences, Inc.

www.alimerasciences.com

Alimera, founded in June 2003, is a pharmaceutical company that specializes in the commercialization and development of prescription ophthalmic pharmaceuticals. Alimera is presently focused on diseases affecting the back of the eye, or retina, because these diseases are not well treated with current therapies and affect millions of people in our aging populations. For more information, please visit www.alimerasciences.com.

Non-GAAP Financial Measure

This press release contains a discussion of a non-GAAP financial measure, as defined in Regulation G promulgated under the Securities Exchange Act of 1934, as amended. Alimera reports its financial results in compliance with GAAP but believes that the non-GAAP measure of Adjusted EBITDA provides useful information to investors regarding Alimera’s operating performance. Alimera uses Adjusted EBITDA in the management of its business. Accordingly, Adjusted EBITDA for the three and nine months ended September 30, 2019 and 2018 has been presented in certain instances excluding items identified in the reconciliations provided in the table entitled “Reconciliation of GAAP Net Loss to non-GAAP Adjusted EBITDA.” GAAP net loss is the most directly comparable GAAP financial measure to Adjusted EBITDA.

Adjusted EBITDA, as presented, may not be comparable to similarly titled measures reported by other companies because not all companies may calculate Adjusted EBITDA in an identical manner. Therefore, Adjusted EBITDA is not necessarily an accurate measure of comparison between companies.

The presentation of Adjusted EBITDA is not intended to be considered in isolation or as a substitute for guidance prepared in accordance with GAAP. The principal limitation of this non-GAAP financial measure is that it excludes significant elements required by GAAP to be recorded in Alimera’s financial statements. In addition, Adjusted EBITDA is subject to inherent limitations as it reflects the exercise of judgments by management in determining this non-GAAP financial measure.

Forward Looking Statements

This press release contains “forward-looking statements,” within the meaning of the Private Securities Litigation Reform Act of 1995, regarding, among other things, Alimera’s expectation regarding its use of the Lincoln Park purchase agreement to obtain capital and Alimera’s expectation that revenue in its international segment will fluctuate from quarter to quarter depending primarily on the timing and size of its international distributor ordering patterns. Such forward-looking statements are based on current expectations and involve inherent risks and uncertainties, including factors that could delay, divert or change them, and could cause actual results to differ materially from those projected in the forward-looking statements. Meaningful factors that could cause actual results to differ include, but are not limited to, (a) Alimera’s ability to satisfy the conditions in the purchase agreement to direct Lincoln Park to make purchases of common stock, (b) the possible negative effects on the market liquidity of Alimera’s common stock of the reverse stock split that Alimera expects to implement if its stockholders approve it at the upcoming special stockholders meeting on November 4, 2019, (c) changes in Alimera’s international sales due to a reduction in end user demand, unanticipated competition, regulatory issues, including delays in obtaining reimbursement approval in various countries in the EU for the treatment of non-infectious posterior uveitis, or other unexpected circumstances, and (d) other factors discussed in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of Alimera’s Annual Report on Form 10-K for the year ended December 31, 2018, and Alimera’s Quarterly Reports on Form 10-Q for the first and second quarters of 2019, which are on file with the Securities and Exchange Commission (SEC) and available on the SEC’s website at http://www.sec.gov. Additional factors will also be described in those sections of Alimera’s Quarterly Report on Form 10-Q for the third quarter of 2019, to be filed with the SEC soon.

The forward-looking statements in this press release speak only as of the date of this press release (unless another date is indicated). Alimera undertakes no obligation, and specifically declines any obligation, to publicly update or revise any such forward-looking statements, whether as a result of new information, future events or otherwise.

For investor inquiries:
Scott Gordon
for Alimera Sciences
scottg@coreir.com

For media inquiries:
Jules Abraham
for Alimera Sciences
julesa@coreir.com



ALIMERA SCIENCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)

September 30,
2019

December 31,
2018

(unaudited)

CURRENT ASSETS:

Cash and cash equivalents

$

7,903

$

13,043

Restricted cash

31

32

Accounts receivable, net

16,377

17,259

Prepaid expenses and other current assets

2,155

2,109

Inventory

1,642

2,405

Total current assets

28,108

34,848

NON-CURRENT ASSETS:

Property and equipment, net

1,060

1,355

Right of use assets, net

1,162

Intangible asset, net

15,272

16,723

Deferred tax asset

1,127

1,182

TOTAL ASSETS

$

46,729

$

54,108

CURRENT LIABILITIES:

Accounts payable

$

6,728

$

6,355

Accrued expenses

3,916

3,643

Note payable

3,333

Finance lease obligations

258

236

Total current liabilities

14,235

10,234

NON-CURRENT LIABILITIES:

Note payable

35,166

37,873

Finance lease obligations — less current portion

132

305

Other non-current liabilities

3,672

2,974

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS’ (DEFICIT) EQUITY:

Preferred stock:

Series A Convertible Preferred Stock

19,227

19,227

Series C Convertible Preferred Stock

11,117

11,117

Common stock

710

701

Additional paid-in capital

348,035

346,108

Common stock warrants

3,707

3,707

Accumulated deficit

(388,068

)

(377,127

)

Accumulated other comprehensive loss

(1,204

)

(1,011

)

TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY

(6,476

)

2,722

TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

$

46,729

$

54,108



ALIMERA SCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018
(in thousands, except share and per share data)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2019

2018

2019

2018

(Unaudited)

NET REVENUE

$

12,850

$

11,137

$

36,595

$

31,484

COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION

(1,579

)

(965

)

(4,353

)

(2,982

)

GROSS PROFIT

11,271

10,172

32,242

28,502

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES

2,761

2,799

8,322

8,398

GENERAL AND ADMINISTRATIVE EXPENSES

3,121

3,446

10,189

10,530

SALES AND MARKETING EXPENSES

6,437

5,480

18,458

17,375

DEPRECIATION AND AMORTIZATION

668

642

1,974

1,941

OPERATING EXPENSES

12,987

12,367

38,943

38,244

NET LOSS FROM OPERATIONS

(1,716

)

(2,195

)

(6,701

)

(9,742

)

INTEREST EXPENSE AND OTHER

(1,232

)

(1,211

)

(3,696

)

(3,540

)

UNREALIZED FOREIGN CURRENCY (LOSS) GAIN, NET

(115

(16

(135

18

LOSS ON EARLY EXTINGUISHMENT OF DEBT

(1,766

)

NET LOSS BEFORE TAXES

(3,063

)

(3,422

)

(10,532

)

(15,030

)

PROVISION FOR TAXES

(77

)

(28

)

(409

)

(104

)

NET LOSS

(3,140

)

(3,450

)

(10,941

)

(15,134

)

GAIN ON EXTINGUISHMENT OF PREFERRED STOCK

38,330

38,330

NET (LOSS) INCOME AVAILABLE TO STOCKHOLDERS

$

(3,140

$

34,880

$

(10,941

$

23,196

NET (LOSS) INCOME PER SHARE — Basic

$

(0.04

)

$

0.40

$

(0.15

)

$

0.26

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — Basic

71,002,307

70,038,411

70,912,124

69,981,744

WEIGHTED AVERAGE PARTICIPATING SHARES – Basic

17,934,164

17,604,533

TOTAL WEIGHTED AVERAGE SHARES OUTSTANDING — Basic

71,002,307

87,972,575

70,912,124

87,586,277

NET (LOSS) INCOME PER SHARE — Diluted

$

(0.04

)

$

0.39

$

(0.15

)

$

0.26

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING — Diluted

71,002,307

70,038,411

70,912,124

69,981,744

WEIGHTED AVERAGE PARTICIPATING AND DILUTIVE SHARES – Diluted

18,445,093

18,126,536

TOTAL WEIGHTED AVERAGE SHARES OUTSTANDING — Diluted

71,002,307

88,483,504

70,912,124

88,108,280



ALIMERA SCIENCES, INC.
CONSOLIDATING STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018
(in thousands)

Three Months Ended
September 30, 2019

Three Months Ended
September 30, 2018

U.S.

International

Other

Consolidated

U.S.

International

Other

Consolidated

(unaudited)

NET REVENUE

$

8,692

$

4,158

$

$

12,850

$

8,492

$

2,645

$

$

11,137

COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION

(1,001

)

(578

)

(1,579

)

(715

)

(250

)

(965

)

GROSS PROFIT

7,691

3,580

11,271

7,777

2,395

10,172

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES

1,573

1,100

88

2,761

1,684

904

211

2,799

GENERAL AND ADMINISTRATIVE EXPENSES

2,032

768

321

3,121

2,050

786

610

3,446

SALES AND MARKETING EXPENSES

4,502

1,840

95

6,437

3,913

1,356

211

5,480

DEPRECIATION AND AMORTIZATION

668

668

642

642

OPERATING EXPENSES

8,107

3,708

1,172

12,987

7,647

3,046

1,674

12,367

SEGMENT (LOSS) INCOME FROM OPERATIONS

(416

)

(128

)

(1,172

)

(1,716

)

130

(651

)

(1,674

)

(2,195

)

OTHER INCOME AND EXPENSES, NET

(1,347

)

(1,347

)

(1,227

)

(1,227

)

NET LOSS BEFORE TAXES

$

(3,063

)

$

(3,422

)


Nine Months Ended
September 30, 2019

Nine Months Ended
September 30, 2018

U.S.

International

Other

Consolidated

U.S.

International

Other

Consolidated

(unaudited)

NET REVENUE

$

22,778

$

13,817

$

$

36.595

$

23,096

$

8,388

$

$

31,484

COST OF GOODS SOLD, EXCLUDING DEPRECIATION AND AMORTIZATION

(2,494

)

(1,859

)

(4,353

)

(2,084

)

(898

)

(2,982

)

GROSS PROFIT

20,284

11,958

32,242

21,012

7,490

28,502

RESEARCH, DEVELOPMENT AND MEDICAL AFFAIRS EXPENSES

4,629

3,361

332

8,322

4,926

2,808

664

8,398

GENERAL AND ADMINISTRATIVE EXPENSES

6,116

2,876

1,197

10,189

6,209

2,416

1,905

10,530

SALES AND MARKETING EXPENSES

12,760

5,324

374

18,458

12,427

4,127

821

17,375

DEPRECIATION AND AMORTIZATION

1,974

1,974

1,941

1,941

OPERATING EXPENSES

23,505

11,561

3,877

38,943

23,562

9,351

5,331

38,244

SEGMENT (LOSS) INCOME FROM OPERATIONS

(3,221

)

397

(3,877

)

(6,701

)

(2,550

)

(1,861

)

(5,331

)

(9,742

)

OTHER INCOME AND EXPENSES, NET

(3,831

)

(3,831

)

(5,288

)

(5,288

)

NET LOSS BEFORE TAXES

$

(10,532

)

$

(15,030

)



RECONCILIATION OF GAAP MEASURES TO NON-GAAP ADJUSTED MEASURES
GAAP NET LOSS TO NON-GAAP ADJUSTED EBITDA
(in thousands)

Three Months Ended
September 30,

Nine Months Ended
September 30,

2019

2018

2019

2018

(Unaudited)

GAAP NET LOSS

$

(3,140

)

$

(3,450

)

$

(10,941

)

$

(15,134

)

Adjustments to net loss:

Interest expense and other

1,232

1,211

3,696

3,540

Provision for taxes

77

28

409

104

Depreciation and amortization

668

642

1,974

1,941

Stock-based compensation expenses

504

1,032

1,903

3,390

Unrealized foreign currency exchange losses (gains)

115

16

135

(18

)

Loss on early extinguishment of debt

1,766

Severance expenses

23

198

NON-GAAP ADJUSTED EBITDA

$

(521

)

$

(521

)

$

(2,626

)

$

(4,411

)