Full Press Release Details
Harold A. Hurwitz, Chief Financial Officer
MRI INTERVENTIONS, INC. ANNOUNCES 2016
FIRST QUARTER RESULTS
Company Sets Quarterly Records in Number
of ClearPoint Procedures
and Disposable Product Revenues
IRVINE, CA, April 28, 2016 - MRI
Interventions, Inc. (OTCQB: MRIC) today announced financial results for the quarter ended March 31, 2016.
million for the three months ended March 31, 2016, and $1.0 million for the same period in 2015, an increase of $384,000, or 38%,
attributable to increases in the Company's ClearPoint system reusable and disposable products.
ClearPoint disposable
product sales for the three months ended March 31, 2016 were $1.1 million, compared with $840,000 for the same period in 2015,
representing an increase of $264,000, or 31%. This increase was due primarily to a greater number of procedures performed using
the ClearPoint system within a larger installed base for ClearPoint in the three months ended March 31, 2016, relative to the same
product sales for the three months ended March 31, 2016 were $262,000, compared with $137,000 for the same period in 2015. Reusable
products consist primarily of computer hardware and software bearing sales prices that are appreciably higher than those for disposable
products and historically have fluctuated from quarter to quarter.
Gross margin on product
revenues was 49% for the three months ended March 31, 2016, compared to 61% for the same period in 2015. The decrease in gross
margin was due primarily to: (a) an increase in the three months ended March 31, 2016, relative to the same period in 2015, in
the allocation of indirect labor to production activities, commensurate with the Company's transition from a focus on research
and development to commercial activities; and (b) an unfavorable product mix related to reusable product sales.
Research and development
costs were $657,000 for the three months ended March 31, 2016, compared to $528,000 for the same period in 2015, an increase of
$129,000, or 25%. The increase was due primarily to increases in the three months ended March 31, 2016, relative to the same period
in 2015, in: (a) software development costs incurred in connection with the Company's development of the next generation
of the ClearPoint operating system; (b) compensation and recruiting costs related to new personnel; (c) project research costs
undertaken in connection with government grants; and (d) licensing fees. These increases were partially offset by: (i) an increase
in the three months ended March 31, 2016, relative to the same period in 2015, in the allocation of research and development personnel
costs to manufacturing in connection with the Company's transition from a focus on research and development to that commercial
activities; and (ii) a reduction in travel costs.
Selling, general and
administrative expenses were $2.0 million for the three months ended March 31, 2016, compared to $2.3 million in the same period
in 2015, a decrease of $314,000, or 14%. This
5 Musick, Irvine, California 92618 949.900.6833
decrease was attributable primarily to decreases in: (a) compensation costs, both
cash and stock-based; and (b) professional fees. Also contributing to the decrease was the allocation of costs, in the three months
ended March 31, 2016, to manufacturing in connection with the Company's transition from a research and development focus
to commercial activities. These fluctuations were partially offset by an increase in other general and administrative costs such
as public company and investor relations expenses.
During the three months
ended March 31, 2016, the Company recorded a gain of $160,000, and during the same period in 2015, the Company recorded a loss
of $783,000, from changes in the fair value of derivative liabilities associated with certain warrants the Company issued in the
2012 and 2013 private placement transactions.
operating loss for the three months ended March 31, 2016 was $1.9 million, as compared with $2.9 million for the same period in
2015, an improvement of $1.0 million, or 34%. Net loss for the three months ended March 31, 2016 was $2.0 million, as compared
with $3.9 million for the same period in 2015, an improvement of $1.9 million, or 48%.
strong quarter of growth," said Frank Grillo, President and Chief Executive Officer of MRI Interventions. "Our technology
was utilized in 122 procedures, and our disposable product revenue reached a new high of more than $1.1 million. With two capital
sales and an additional three sites starting evaluations, our installed base now consists of 45 hospitals, and interest continues
to grow. Word is out among surgeons and neurologists regarding our more patient friendly approach to deep brain stimulation, better
accuracy during laser ablation, and precision in biopsy.
to reduce our cash utilization continue to payoff. Our operating loss declined 34% from the first quarter of 2015, and our use
of cash for operations declined 43%. We continue to focus on growing our business efficiently, and we are achieving our goals.
quarter, we have two of our largest trade shows of the year, where we will have the opportunity to show our technology to surgeons
in hands-on workshops, in sponsored lectures and on the exhibit floor. We believe these events will be a great opportunity to educate
more surgeons regarding our technology and its positive impact on patient care.
in disposable revenue, adoption is clearly on the rise, and momentum continues to build. We believe our customers are realizing
the benefits our technology brings to hospitals, physicians and their patients."
Investors and analysts
are invited to listen to a live broadcast review of the Company's 2016 first quarter financial results today at 4:30 p.m. Eastern
Time (1:30 p.m. Pacific Time) that may be accessed by visiting the Company's website at www.mriinterventions.com and selecting
"Investors" / "News" / "IR Calendar." The conference call may also be accessed at http://mriinterventions.equisolvewebcast.com/q1-2016.
Investors and analysts who would like to participate in the conference call may do so via telephone at (877) 407-9034, or at (201)
493-6737 if calling from outside the U.S. or Canada.
For those who cannot
access the live broadcast, a replay will be available shortly after the completion of the call until May 5, 2016 by calling (877)
660-6853, or (201) 612-7415 if calling from outside the U.S. or Canada, and then entering conference I.D. number 413671. An online
archive of the broadcast will be available on the Company's website at www.mriinterventions.com, on the "Investor Relations"
MRI Interventions, Inc.
on the imaging power of magnetic resonance imaging, or MRI, MRI Interventions is creating innovative platforms for performing the
next generation of minimally invasive surgical procedures. The ClearPoint system, which has received 510(k) clearance and
is CE marked, utilizes a hospital's existing diagnostic or intraoperative MRI suite to enable a range of minimally invasive
procedures in the brain. For more information, please visit www.mriinterventions.com.
Statements herein concerning
the Company's plans, growth and strategies may include "forward-looking statements" within the context of the federal
securities laws. Statements regarding the Company's future events, developments and future performance, as well as management's
expectations, beliefs, plans, estimates or projections relating to the future, are forward-looking statements within the meaning
of these laws. The Company's actual results may differ materially from those suggested as a result of various factors. Particular
uncertainties and risks include those relating to: the Company's ability to obtain additional financing; estimates regarding
the sufficiency of the Company's cash resources; future revenues from sales of the Company's ClearPoint system products;
and the Company's ability to market, commercialize and achieve broader market acceptance for the Company's ClearPoint
system products. More detailed information on these and additional factors that could affect the Company's actual results
are described in the Company's Annual Report on Form 10-K for the year ended December 31, 2015 which has been filed with the Securities
and Exchange Commission, as well as the Company's Quarterly Report on Form 10-Q for the three months ended March 31, 2016, which
the Company expects to file in May 2016 with the Securities and Exchange Commission.
MRI INTERVENTIONS, INC.
Condensed Consolidated Statements of Operations
| For The Three Months Ended March 31, | ||||||||
| 2016 | 2015 | |||||||
| Revenues: | ||||||||
| Product revenues | $ | 1,366,153 | $ | 976,871 | ||||
| Other service revenues | 27,981 | 33,532 | ||||||
| Total revenues | 1,394,134 | 1,010,403 | ||||||
| Cost of product revenues | 696,546 | 385,609 | ||||||
| Research and development costs | 657,192 | 527,512 | ||||||
| Selling, general, and administrative expenses | 1,974,249 | 2,288,660 | ||||||
| Restructuring charges | - | 753,400 | ||||||
| Operating loss | (1,933,853 | ) | (2,944,778 | ) | ||||
| Other income (expense): | ||||||||
| Gain (loss) on change in fair value of derivative liabilities | 160,118 | (782,802 | ) | |||||
| Other income, net | 75,142 | 82,688 | ||||||
| Interest income | 4,333 | 7,451 | ||||||
| Interest expense | (349,558 | ) | (307,813 | ) | ||||
| Net loss | $ | (2,043,818 | ) | $ | (3,945,254 | ) | ||
| Net loss per share attributable to common stockholders: | ||||||||
| Basic and diluted | $ | (0.02 | ) | $ | (0.05 | ) | ||
| Weighted average shares outstanding: | ||||||||
| Basic and diluted | 91,645,881 | 74,842,841 |
MRI INTERVENTIONS, INC.
Condensed Consolidated Balance Sheets
| March 31, 2016 | December 31, 2015 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 3,582,227 | $ | 5,408,523 | ||||
| Accounts receivable | 1,497,537 | 1,218,043 | ||||||
| Inventory, net | 1,570,078 | 1,807,895 | ||||||
| Prepaid expenses and other current assets | 115,364 | 97,249 | ||||||
| Total current assets | 6,765,206 | 8,531,710 | ||||||
| Property and equipment, net | 459,259 | 440,606 | ||||||
| Software license inventory | 989,600 | 937,100 | ||||||
| Other assets | 77,446 | 27,306 | ||||||
| Total assets | $ | 8,291,511 | $ | 9,936,722 | ||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 818,047 | $ | 697,807 | ||||
| Accrued compensation | 455,915 | 557,784 | ||||||
| Other accrued liabilities | 1,305,943 | 1,398,707 | ||||||
| Derivative liabilities | 498,168 | 658,286 | ||||||
| Deferred product and service revenues | 151,706 | 116,009 | ||||||
| Senior secured note payable, net of unamortized discount of $64,835 at December 31, 2015 | - | 4,224,609 | ||||||
| Total current liabilities | 3,229,779 | 7,653,202 | ||||||
| Accrued interest | 577,125 | 542,500 | ||||||
| Senior secured note payable | 4,289,444 | - | ||||||
| 2014 junior secured notes payable, net of unamortized discount and deferred issuance costs of $434,408 and $467,611 at March 31, 2016 and December 31, 2015, respectively | 3,290,592 | 3,257,389 | ||||||
| 2010 junior secured notes payable, net of unamortized discount of $2,535,230 and $2,481,510 at March 31, 2016 and December 31, 2015, respectively | 518,490 | 464,770 | ||||||
| Total liabilities | 11,905,430 | 11,917,861 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' deficit: | ||||||||
| Common stock, $0.01 par value; 200,000,000 shares authorized; 91,916,634 shares issued and outstanding at March 31, 2016; and 91,381,488 issued and outstanding at December 31, 2015 | 919,165 | 913,814 | ||||||
| Additional paid-in capital | 83,237,314 | 82,831,627 | ||||||
| Accumulated deficit | (87,770,398 | ) | (85,726,580 | ) | ||||
| Total stockholders' deficit | (3,613,919 | ) | (1,981,139 | ) | ||||
| Total liabilities and stockholders' deficit | $ | 8,291,511 | $ | 9,936,722 |
MRI INTERVENTIONS, INC.
Condensed Consolidated Statements of Cash Flows
| For The Three Months Ended March 31, | ||||||||
| 2016 | 2015 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (2,043,818 | ) | $ | (3,945,254 | ) | ||
| Adjustments to reconcile net loss to net cash flows from operating activities: | ||||||||
| Depreciation and amortization | 41,022 | 86,680 | ||||||
| Share-based compensation | 260,149 | 377,892 | ||||||
| Expenses paid through the issuance of common stock | 192,166 | 37,583 | ||||||
| (Gain) loss on change in fair value of derivative liabilities | (160,118 | ) | 782,802 | |||||
| Amortization of debt issuance costs and original issue discounts | 151,759 | 110,015 | ||||||
| Increase (decrease) in cash resulting from changes in: | ||||||||
| Accounts receivable | (279,494 | ) | (136,769 | ) | ||||
| Inventory | 217,873 | (109,994 | ) | |||||
| Prepaid expenses and other current assets | (18,114 | ) | (6,909 | ) | ||||
| Other assets | (58,473 | ) | (4,000 | ) | ||||
| Accounts payable and accrued expenses | 52,790 | 13,782 | ||||||
| Deferred revenue | 35,697 | (4,870 | ) | |||||
| Net cash flows from operating activities | (1,608,561 | ) | (2,799,042 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (77,649 | ) | (6,635 | ) | ||||
| Net cash flows from investing activities | (77,649 | ) | (6,635 | ) | ||||
| Cash flows from financing activities | ||||||||
| Payment of 2015 private placement financing costs | (140,086 | ) | - | |||||
| Net cash flows from financing activities | (140,086 | ) | - | |||||
| Net change in cash and cash equivalents | (1,826,296 | ) | (2,805,677 | ) | ||||
| Cash and cash equivalents, beginning of period | 5,408,523 | 9,244,006 | ||||||
| Cash and cash equivalents, end of period | $ | 3,582,227 | $ | 6,438,329 | ||||
| SUPPLEMENTAL CASH FLOW INFORMATION | ||||||||
| Cash paid for: | ||||||||
| Income taxes | $ | - | $ | - | ||||
| Interest | $ | 223,500 | $ | 223,500 |