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InMode Reports Second Quarter 2019 Financial Results; Record Quarterly Revenue of $38.8 Million Reflects Growth of 55% Over Prior Year

LAKE FOREST, Calif., Aug. 13, 2019 /PRNewswire/ -- InMode Ltd. (Nasdaq: INMD) ("InMode"), a leading global provider of innovative medical technologies, today announced financial results for the second quarter ended June 30, 2019.

Second Quarter 2019 Highlights:

  • Quarterly revenue of $38.8 million, a 55% increase year-over-year
  • Gross margins of 87%, compared to 84% year-over-year
  • Net income of $15.8 million, a 109% increase year-over-year
  • Total cash position of $82.8 million, including cash and cash equivalents, marketable securities and deposits. This excludes proceeds raised in InMode's initial public offering

Management Comments

"We are pleased with our second quarter results, which are consistent with both our reported expectations and the positive trends we are continuing to see in our business," commented Moshe Mizrahy, Chief Executive Officer and Chairman of the Board.

2019 Second Quarter Results

Total revenues for the second quarter of 2019 were $38.8 million, an increase of 55% compared to the second quarter of 2018. This was primarily driven by higher revenues in the U.S. resulting from an expansion of our direct sales organization, and an increase in the number of clinical workshops for customers and prospects and an increase in the average sale price of platforms.

Gross margin for the second quarter of 2019 was 87%, compared to the gross margin of 84% in the second quarter of 2018. This increase is primarily attributable to an increase in average sale price of our platforms in the U.S.

Operating margin for the second quarter of 2019 was 41%, compared to the operating margin of 31% in the second quarter of 2018. This increase is primarily attributable to an estimated increase in our gross profit exceeding the increase in our operating expenses.

The company reported net income of $15.8 million, or $0.45 per diluted share, in the second quarter of 2019. This is compared with net income of $7.6 million, or $0.21 per diluted share, in the second quarter of 2018.

Total cash position, including cash and cash equivalents, marketable securities and deposits, was $82.8 million as of June 30, 2019. This excludes proceeds raised in InMode's initial public offering.

About InMode

InMode is a leading global provider of innovative medical technologies.  InMode develops, manufactures, and markets devices harnessing novel radio-frequency ("RF") technology.  InMode strives to enable new emerging surgical procedures as well as improve existing treatments.  InMode has leveraged its medically-accepted minimally-invasive RF technologies to offer a comprehensive line of products across several categories for plastic surgery, gynecology, dermatology, otolaryngology, and ophthalmology.  For more information about InMode, please visit www.inmodemd.com.

Forward-Looking Statements 

The information in this press release includes forward-looking statements within the meaning of the federal securities laws. These statements generally relate to future events or our future financial or operating performance. Actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. In some cases, you can identify these statements because they contain words such as "anticipate," "believe," "estimate," "expect," "intend," "may," "plan," "predict," "project," "will," "would" and similar expressions that concern our expectations, strategy plans or intentions. Forward-looking statements are based on management's current expectations and assumptions, and are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. As a result, actual results could differ materially from those indicated in these forward-looking statements. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements contained in our prospectus (included in the Registration Statement on Form F-1, filed with the Securities and Exchange Commission (File No. 333-232615), as amended). InMode undertakes no obligation and does not intend to update these forward-looking statements to reflect events or circumstances occurring after this press release. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release.

 

INMODE LTD.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

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

(Unaudited)



Three months ended
June 30

Six months ended
June 30


2019

2018

2019

2018






REVENUES

38,797

25,050

69,349

45,961

COST OF REVENUES

4,875

3,917

9,146

7,449

GROSS PROFIT

33,922

21,133

60,203

38,512

OPERATING EXPENSES:





Research and development

1,584

941

2,783

1,821

Sales and marketing

15,898

11,330

29,995

20,995

General and administrative

713

1,019

1,766

1,914

TOTAL OPERATING EXPENSES

18,195

13,290

34,544

24,730

INCOME FROM OPERATIONS

15,727

7,843

25,659

13,782

Finance income (expense), net

382

(70)

785

208

INCOME BEFORE TAXES

16,109

7,773

26,444

13,990

INCOME TAX

274

193

451

44

NET INCOME

15,835

7,580

25,993

13,946

Less: Net income attributable to non-controlling interests

(38)

-

(72)

-

NET INCOME ATTRIBUTABLE TO INMODE LTD. SHAREHOLDERS

15,797

7,580

25,921

13,946






NET INCOME PER SHARE (1):





Basic

0.58

0.27

0.96

0.50

Diluted

0.45

0.21

0.73

0.38






WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING USED IN COMPUTATION OF NET INCOME PER SHARE  (1)





Basic

26,963

26,627

26,891

26,563

Diluted

35,344

35,060

35,334

34,949



(1)

The number of shares have been adjusted retroactively for a 1-for-1.789 stock split of InMode shares by way of an issuance of bonus shares, that occurred pursuant to a resolution of our board of directors dated July 24, 2019.

 

INMODE LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

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

(Unaudited)



June 30,

December 31,


2019

2018

Assets



CURRENT ASSETS:



Cash and cash equivalents

28,877

24,721

Marketable securities

36,677

26,532

Short-term bank deposits

17,220

10,045

Accounts receivable, net of allowance for doubtful accounts

5,238

7,008

Other receivables

1,326

2,495

Inventories

7,616

6,963

TOTAL CURRENT ASSETS

96,954

77,764

NON-CURRENT ASSETS:



Accounts receivable

486

544

Deferred offering costs

1,185

895

Deferred income taxes, net

1,452

1,309

Property and equipment, net

871

544

Operating lease right-of-use assets

1,609

-

TOTAL NON-CURRENT ASSETS

5,603

3,292

TOTAL ASSETS

102,557

81,056




Liabilities and shareholders' equity



CURRENT LIABILITIES:



Accounts payable

4,867

4,509

Contract liabilities

8,276

5,755

Other liabilities

9,802

9,165

Accrued contingencies

-

10,000

TOTAL CURRENT LIABILITIES

22,945

29,429

NON-CURRENT LIABILITIES:



Contract liabilities

3,839

3,982

Other liabilities

771

771

Operating lease liabilities

1,021

-

Deferred income taxes

57

11

TOTAL NON-CURRENT LIABILITIES

5,688

4,764

TOTAL LIABILITIES

28,633

34,193




REDEEMABLE NON-CONTROLLING INTEREST

2,317

2,187




TOTAL SHAREHOLDERS' EQUITY

71,607

44,676

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

102,557

81,056

 

INMODE LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

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

(Unaudited)



Three months ended
June 30

Six months ended
June 30


2019

2018

2019

2018






CASH FLOWS FROM OPERATING ACTIVITIES:





Net income

15,835

7,580

25,993

13,946

Adjustments required to reconcile net income to net cash provided by operating activities:





Depreciation and amortization

74

43

137

78

Stock-based compensation expense

412

891

814

1,724

Allowance for doubtful accounts

19

44

78

(29)

Gains on marketable securities, net

-

(21)

-

(54)

Changes in fair value of marketable securities, net

-

(30)

-

(36)

Finance income, net

(126)

-

(309)

-

Provision for deferred income taxes, net

(77)

(123)

(143)

(127)

Changes in operating assets and liabilities:





Decrease in accounts receivable

1,580

2,308

1,727

1,744

Decrease in other receivables

291

204

1,164

455

Decrease (increase) in inventories

(524)

72

(653)

(752)

Increase (decrease) in accounts payable

1,085

(722)

70

(235)

Increase (decrease) in other liabilities

465

(1,840)

16

(1,657)

Increase (decrease) in contract liabilities

(533)

4,396

2,378

5,142

Decrease in accrued contingencies

-

-

(10,000)

-

     Net cash provided by operating activities

18,501

12,802

21,272

20,199

CASH FLOWS FROM INVESTING ACTIVITIES:





Investment in short-term deposit

(6,090)

-

(17,090)

-

Proceeds from short-term deposit

5,000

-

10,000

-

Purchase of fixed assets

(86)

(166)

(464)

(211)

Purchase of marketable securities

(9,421)

(4,733)

(14,339)

(7,177)

Proceeds from sale of marketable securities

2,000

2,059

4,603

2,555

Net cash (used in) investing activities

(8,597)

(2,840)

(17,290)

(4,833)

CASH FLOWS FROM FINANCING ACTIVITIES:





Exercise of options

15

7

137

157

Net cash provided by financing activities

15

7

137

157

EFFECT OF EXCHANGE RATE CHANGES ON CASH

7

(107)

37

(118)

NET INCREASE IN CASH AND CASH EQUIVALENTS

9,926

9,862

4,156

15,405






CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD

18,951

23,136

24,721

17,593

CASH AND CASH EQUIVALENTS AT END OF PERIOD

28,877

32,998

28,877

32,998

 

INMODE LTD.

CONDENSED CONSOLIDATED FINANCIAL HIGHLIGHTS

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

(Unaudited)



Three months ended
June 30

Six months ended
June 30


2019

2018

2019

2018






Revenues by Geography:





United States

32,720

20,547

56,806

37,865

International

6,077

4,503

12,543

8,096

Total Net Revenue

38,797

25,050

69,349

45,961

U.S as percentage of total revenue

84%

82%

82%

82%

 

Company Contact:

Investor Relations Contact:

Yair Malca

Miri Segal

Chief Financial Officer

MS-IR LLC

Phone: (949) 305-0108

Phone: (917) 607-8654

Email: Yair.Malca@inmodemd.com 

Email: ir@inmodemd.com

 

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SOURCE InMode