Full Press Release Details
Nanox Announces Third Quarter 2021 Financial
Provides Business Update
Reports progress towards global supply chain
Ended the third quarter with cash and marketable
securities of $180.3 million
Management to host conference call and webcast
today, November 17, at 8:30 AM ET
NEVE ILAN, Israel-November 17, 2021 -- NANO-X
IMAGING LTD (NASDAQ: NNOX) ("Nanox" or the "Company"), an innovative medical imaging technology
company, today announced results for the third quarter ended September 30, 2021 and provided a business update.
As previously reported, Nanox completed the merger
with NANO-X AI LTD (formerly Zebra Medical Vision LTD, "Nanox AI"), a deep-learning medical imaging analytics company, in
an all-stock deal valued at approximately $110 million at closing, with up to $84 million in contingent consideration to be paid in additional
stock if Nanox AI enters into any of two designated commercial agreements and achieve certain milestones. Additionally, the Company completed
the acquisition of USARAD Holdings, Inc., a leading provider of teleradiology services, and the assets of MDWEB, LLC., a decentralized
marketplace connecting imaging facilities with radiologists, together, for approximately $7.3 million in cash and $12.9 million in stock,
with up to $2.0 million in cash and up to $8.0 million in stock in deferred consideration upon the completion of various milestones.
"The third quarter was pivotal for Nanox, as
we made meaningful progress toward the commercialization of the Nanox System across multiple fronts. Among our recent accomplishments,
we continued to secure our supply chain, enlarged our backlog of orders by signing additional MSaaS agreements, and, importantly, finalized
three previously announced strategic M&A transactions," said Ran Poliakine, Chairman of the Board and Chief Executive Officer
of Nanox. "We look forward to continuing our progress toward our goal of bringing the groundbreaking technology to market in 2022."
Third Quarter Highlights and Recent Developments:
results for three months ended September 30, 2021
For the three months ended September 30, 2021, the
Company reported a net loss of $13.5 million, compared to a net loss of $11.1 million for the three-month period ended September 30, 2020,
largely due to an increase in our research and development expenses and general and administrative expenses, which were partially offset
by a decrease in our marketing expenses.
Research and development expenses for the third
quarter 2021 were $3.7 million, as compared to $2.1 million for the same period in 2020. The increase was due to Research and Development
costs related to the multi-source Nanox.ARC and cloud, including increased R&D headcount, costs related to the ongoing regulatory
approval process and share-based compensation.
Marketing expenses for the third quarter 2021
were $1.5 million, as compared to $2.7 million for the same period in 2020. The decrease was mainly due to decrease of $1.7 million in
share-based compensation which was partially offset by an increase of $0.5 million in marketing and branding expenses.
General and administrative expenses for the third
quarter 2021 were $8.2 million, as compared to $6.3 million for the same period in 2020. The increase of $1.9 million was mainly due to
an increase in our labor cost of approximately $0.5 million primarily as a result of an increase in our head count in connection with
the expansion of the Company's management team and the overall organization infrastructure, increase in our D&O insurance expenses
of approximately $0.5, increase on in our legal fees in the amount of approximately $0.6 million due to the SEC inquiry and class-action
litigation as described in our Form 6-K filed on November 17, 2021 and transaction expenses with connection to the acquisitions of Nanox
AI, USARAD Holdings, Inc. and the assets of MDWEB, LLC in the amount of approximately $0.5 million.
Net cash used in operating activities during the
three months ended September 30, 2021 was $7.0 million. The Company ended the third quarter 2021 with cash, cash equivalents and marketable
securities of $180.3 million.
Non-GAAP net loss for the three months ended September
30, 2021 was $8.5 million, as compared to $5.1 million for the same period in 2020 primarily due to an increase in our research and development
expenses, general and administrative expenses and our marketing expenses. Non-GAAP research and development expenses for the three months
ended September 30, 2021 were $3.0 million, as compared to $1.5 million for the same period in 2020. Non-GAAP Marketing expenses for the
three months ended September 30, 2021 were $1.0 million, as compared to $0.5 million for the same period in 2020. Non-GAAP General and
administrative expenses for the three months ended September 30, 2021 were $4.5 million, as compared to $3.1 million for the same period
A reconciliation between GAAP and non-GAAP financial
measures for the three-month and nine-month periods ended September 30, 2021 and 2020 is provided in the financial results that are part
of this press release. The difference between the GAAP and non-GAAP financial measures above is mainly attributable to share-based compensation,
secondary offering expenses and legal fees in connection with class-action litigation and the SEC inquiry.
As of September 30, 2021, the Company had approximately
47.9 million shares outstanding.
Conference call and webcast details
Wednesday, November 17, 2021 @ 8:30am ET
Investor US/Canada toll-free dial-in: (877) 550-3765
Investor US/Canada International dial-in: (409)
Conference ID: 7872065
Webcast link: Nanox Q3 2021 Earnings Call
Nanox, founded by the serial entrepreneur Ran
Poliakine, is an Israeli corporation developing a commercial-grade digital X-ray source designed to be used in real-world medical
imaging applications. Nanox believes that its novel technology could significantly reduce the costs of medical imaging systems and plans
to seek collaborations with world-leading healthcare organizations and companies to provide affordable, early detection imaging service
for all. For more information, please visit www.nanox.vision.
Forward-Looking Statements:
This press release may contain forward-looking
statements that are subject to risks and uncertainties. All statements that are not historical facts contained in this press release
are forward-looking statements. Such statements include, but are not limited to, any statements relating to the initiation, timing, progress
and results of the Company's research and development, manufacturing and commercialization activities with respect to its X-ray source
technology and the Nanox.Arc, the ability to realize the expected benefits of the acquisitions and the projected business prospects of
the Company and the acquired companies. In some cases, you can identify forward-looking statements by terminology such as "can,"
"might," "believe," "may," "estimate," "continue," "anticipate,"
"intend," "should," "plan," "should," "could," "expect," "predict,"
"potential," or the negative of these terms or other similar expressions. Forward-looking statements are based on information
the Company has when those statements are made or management's good faith belief as of that time with respect to future events, and are
subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested
by the forward-looking statements. Factors that could cause actual results to differ materially from those currently anticipated include:
risks related to (1) the inability to successfully integrate the acquired companies, (2) the inability to realize the anticipated benefits
of the acquisitions, which may be affected by, among other things, competition, brand recognition, the ability of the acquired companies
to grow and manage growth profitably and retain their key employees, (3) costs related to the acquisitions and/or unknown or inestimable
liabilities, (4) changes in applicable laws or regulations that impact the operations of the acquired companies, (5) the failure to meet
projected technology development targets, (6) the failure of the acquired companies to effectively scale end-to-end medical imaging solutions
worldwide, (7) changes in global, political, economic, business, competitive, market and regulatory forces, and (8) (i) Nanox's
ability to complete development of the Nanox.Arc; (ii) Nanox's ability to successfully demonstrate the feasibility of its technology
for commercial applications; (iii) Nanox's expectations regarding the necessity of, timing of filing for, and receipt and maintenance
of, regulatory clearances or approvals regarding its X-ray source technology and the Nanox.Arc from regulatory agencies worldwide and
its ongoing compliance with applicable quality standards and regulatory requirements; (iv) Nanox's ability to enter into and maintain
commercially reasonable arrangements with third-party manufacturers and suppliers to manufacture the Nanox.Arc; (v) the market acceptance
of the Nanox.Arc and the proposed pay-per-scan business model; (vi) Nanox's expectations regarding collaborations with third-parties
and their potential benefits; and (vii) Nanox's ability to conduct business globally, among other things.
For a discussion of other
risks and uncertainties, and other important factors, any of which could cause Nanox's actual results to differ from those contained
in the Forward-Looking Statements, see the section titled "Risk Factors" in Nanox's Annual Report on Form 20-F for the
year ended December 31, 2020, and subsequent filings with the U.S. Securities and Exchange Commission. The reader should not place undue
reliance on any forward-looking statements included in this press release
Except as required by