HORSHAM, Pa., Nov. 10, 2020 (GLOBE NEWSWIRE) -- STRATA Skin Sciences, Inc. (NASDAQ: SSKN), a medical technology company in Dermatology and Plastic Surgery dedicated to developing, commercializing and marketing innovative products for the treatment of dermatologic conditions, today announced financial results for the quarter ended September 30, 2020.
Recent Highlights
- Total revenue for the third quarter of 2020 was $5.6 million, a decrease of 25.0% over the third quarter of 2019
– Recurring revenue for the third quarter of 2020 was $3.8 million, a 35.9% decrease over the third quarter of 2019 and a 37.2% increase over the second quarter of 2020
– Gross domestic recurring billings were $4.7 million, a 155% increase over the second quarter 2020 (See Reconciliation of Non-GAAP measures below) - Total gross margins in the third quarter of 2020 were 57.5%, a 4.3% decrease over third quarter 2019
- Cash, cash equivalents and restricted cash at September 30, 2020 were $18.5 million
- Concluded the quarter with a global recurring revenue installed base of 837 XTRAC devices, an increase of 31 from June 30, 2020
- Results of our sponsored, peer-reviewed study entitled, “Therapies for Psoriasis: Clinical and Economic Comparisons,” published in the Journal of Drugs in Dermatology. XTRAC® was found to be most effective and economical treatment for plaque psoriasis compared to other therapies
- Cigna, a global health company insuring over 20 million people in the United States, issued a new medical coverage policy insuring the previously uncovered condition of vitiligo
“We are pleased by our performance in the third quarter, underscored by strong growth in both recurring revenue and gross domestic recurring billings over the second quarter of 2020, commensurate with broader trends in regional recovery. We are confident that these results demonstrate the measures we implemented in 2018 – to strategically focus on driving recurring revenue – are resonating once again, picking up from the meaningful momentum that we built in 2019,” said Dr. Dolev Rafaeli, Chief Executive Officer of STRATA Skin Sciences.
Dr. Rafaeli continued, “While we are encouraged by these positive trends, we remain cautiously optimistic with variability expected from COVID-19 resurgences and rising cases across the U.S. and the world. Despite this continued level of uncertainty, we remain confident in the core strength of our business and the resiliency of our team and partner clinics. We believe that we are strategically poised to deliver durable growth over the long term, as we continue to lead the way for improved patient care with XTRAC.”
Third Quarter 2020 Financial Results
Revenues for the third quarter of 2020 were $5.6 million, as compared to revenues of $7.5 million for the third quarter of 2019. Recurring revenues for the third quarter of 2020 were $3.8 million, as compared to recurring revenues of $6.0 million for the third quarter of 2019. Equipment revenues were $1.8 million for the third quarter of 2020, as compared to $1.5 million for the third quarter of 2019.
Gross profit for the third quarter of 2020 was $3.2 million, or 57.5% of revenues, as compared to $4.6 million, or 61.8% of revenues, for the third quarter of 2019. Gross profit on recurring revenues for the third quarter of 2020 was $2.5 million, or 64.3% of revenues, as compared to $4.0 million, or 67.2% of revenues, for the third quarter of 2019. The decrease in gross profit is the result of lower sales due to the COVID-19 pandemic, fixed costs in manufacturing and the impact of the change in deferred revenues.
Selling and marketing costs for the third quarter of 2020 were $2.1 million, as compared to $2.9 million for the third quarter of 2019, primarily as a result of lower tradeshow costs, travel costs, compensation costs and direct to consumer advertising costs. General and administrative costs for the third quarter of 2020 were $1.9 million, as compared to $2.2 million for the third quarter of 2019, as a result of lower legal, accounting and consulting costs partially offset by higher insurance and stock compensation costs. Other expense for the third quarter of 2020 was $21,000, compared to $153,000 for the third quarter of 2019, as a result of lower interest expense due to refinancing of the Company’s long-term debt in December 2019.
Net loss for third quarter 2020 was $1.3 million, or a loss of $0.04 per basic and diluted common share, as compared to the net loss for the third quarter of 2019 of $0.9 million, or a net loss of $0.03 per basic and diluted common share.
About STRATA Skin Sciences, Inc.
STRATA Skin Sciences is a medical technology company in Dermatology and Plastic Surgery dedicated to developing, commercializing and marketing innovative products for the treatment of dermatologic conditions. Its products include the XTRAC® excimer laser and VTRAC® lamp systems utilized in the treatment of psoriasis, vitiligo and various other skin conditions.
The Company’s proprietary XTRAC® excimer laser delivers a highly targeted therapeutic beam of UVB light to treat psoriasis, vitiligo, eczema, atopic dermatitis and leukoderma; diseases which impact over 35 million patients in the United States alone. The technology is covered by multiple patents, including exclusive rights for patents for the delivery of treatments to vitiligo patients.
STRATA’s unique business model leverages targeted Direct to Consumer (DTC) advertising to generate awareness and utilizes its in-house call center and insurance advocacy teams to increase volume for the Company’s partner dermatology clinics.
The XTRAC business has used this proven DTC model to grow its domestic dermatology partner network to over 813 clinics, with a worldwide installed base of over 2,000 devices. The Company is able to offer 90% of DTC patients an introduction to physicians prescribing a reimbursable solution, using XTRAC, within a 10-mile radius of their house. The Company is a leader in dermatology in-clinic business generation for its partners.
