NASHUA, N.H., Aug. 05, 2021 (GLOBE NEWSWIRE) — iCAD, Inc. (NASDAQ: ICAD), a global medical technology leader providing innovative cancer detection and therapy solutions, today reported its financial and operating results for the three and six months ended June 30, 2021.

Revenues for the three-month and six-month periods ended June 30, 2021 were $7.8 million and $16.5 million, respectively, compared to $5.6 million and $12.1 million in the three and six month periods ended June 30, 2020, respectively. Net loss for the three-month and six-month periods ended June 30, 2021 were $3.3 million and $4.9 million, respectively, compared to $2.4 million and $14.2 million in the three and six month periods ended June 30, 2020, respectively.

Recent Highlights:

• Continued market penetration with ProFound AI
  
  ^®
  
  Risk, the first and only commercially available clinical decision support tool providing two-year breast cancer risk estimation personalized for each woman, for 2D mammography in the U.S. and Europe, with approximately 250 software licenses installed to date
• Showed continued strength in the Therapy business with $3 million in revenues, which represents 3.8% growth over a very strong first quarter, driven largely by the continued surge in dermatology controller installations reflecting positive shifts in market dynamics
• Signed a global distribution agreement with Sectra, a leading international medical imaging IT and cybersecurity company, expanding access to ProFound AI
  
  ^®
  
  and ProFound AI
  
  ^®
  
  Risk to additional facilities and imaging centers worldwide
• Received CE Mark approval for ProFound AI
  
  ^®
  
  Version 3.0 for 3D Mammography
  • Company’s third-generation AI solution offers significant improvement in algorithm specificity performance and faster processing time compared to the prior versions
• Enhanced our senior leadership, including
  • appointed Charles Carter as full time Chief Financial Officer
  • promoted Jeffrey Sirek to Chief Commercial Officer
  • hired Brian Testa as Chief People Officer
    

“Our second quarter total revenue was negatively impacted by longer than expected Enterprise sales cycles in several large prospective accounts.   We began to close some of these accounts in July. While we anticipate the longer Enterprise sales cycle will continue to be a meaningful component of our pipeline, the addition of these Enterprise sales will increase our addressable market and future average deal size,” said Mike Klein, Chairman and CEO.

“We continue to be pleased with the performance of our Therapy segment. Total Therapy revenues of $3 million represented a 109% percent increase over the second quarter of last year and a 3.8% increase over a strong first quarter in 2021. This growth was primarily driven by dermatology controller installations, which are being heavily influenced by the emergence of positive shifts in reimbursement, payor coverage and regulatory changes,” concluded Mr. Klein.

Second Quarter 2021 Financial Results


Total Detection and Therapy revenue for the second quarter of 2021 was $7.8 million, an increase of $2.3 million, or 41%, as compared to the second quarter of 2020.

Revenue: Cancer Detection revenue for the second quarter of 2021, which includes the Company’s mammography and breast density products, and the associated service and supplies revenue, increased by approximately $0.7 million, or 16%, to $4.8 million, as compared to the second quarter of 2020. Therapy revenue for the second quarter of 2021, which includes Xoft

^®

Axxent

^®

eBx

^®

System

^®

sales, as well as the associated service and supplies revenue, increased by $1.6 million, or 109%, to $3.0 million, as compared to the second quarter of 2020.

Gross Profit: Gross profit for the second quarter of 2021 was $5.5 million, or 71% of revenue, as compared to $4.4 million, or 78% of revenue, in the second quarter of 2020.

Operating Expenses: Total operating expenses for the second quarter of 2021 were $8.4 million, a $1.7 million, or 26% increase from $6.7 million in the second quarter of 2020.

GAAP Net Loss: Net loss for the second quarter of 2021 was ($3.3) million, or ($0.13) per diluted share, as compared to a net loss of ($2.4) million, or ($0.11) per diluted share, for the second quarter of 2020. GAAP Net Loss in 2021 included a $0.4 million charge related to the losses on the extinguishment of debentures and debt.

Non-GAAP Adjusted Net Loss: Non-GAAP Adjusted Net Loss, a non-GAAP financial measure as defined below, for the second quarter of 2021 was ($2.8) million, or ($0.11) per diluted share, as compared to a Non-GAAP Adjusted Net Loss of ($2.5) million, or ($0.12) per diluted share, for the second quarter of 2020. Please refer to the section entitled “Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Measures” and the accompanying financial table included at the end of this release for a reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Loss results for the three-month periods ended June 30, 2021 and 2020, respectively.

Non-GAAP Adjusted EBITDA: Non-GAAP Adjusted EBITDA, a non-GAAP financial measure as defined below, for the second quarter of 2021 was a loss of ($2.1) million, a ($1.4) million increased loss as compared to the second quarter 2020 Non-GAAP Adjusted EBITDA loss of ($0.7) million. Please refer to the section entitled “Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Measures” and the accompanying financial table included at the end of this release for a reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA results for the three-month periods ended June 30, 2021 and 2020, respectively.

Six Months Ended June 30, 2021 Financial Results

Total Detection and Therapy revenue for the six months ended June 30, 2021 was $16.5 million, an increase of $4.4 million, or 36%, as compared to the same period in 2020.

Revenue: Cancer Detection revenue for the six months ended June 30, 2021, which includes the Company’s mammography and breast density products, and the associated service and supplies revenue, increased by approximately $1.9 million, or 22%, to $10.5 million, as compared to the same period in 2020. Therapy revenue for the six months ended June 30, 2021, which includes Xoft

^®

Axxent

^®

eBx

^®

System

^®

sales, as well as the associated service and supplies revenue, increased by $2.4 million, or 69%, to $6.0 million, as compared to the same period in 2020.

Gross Profit: Gross profit for the six months ended June 30, 2021 was $11.8 million, or 72% of revenue, as compared to $8.9 million, or 73% of revenue, in the same period in 2020.

Operating Expenses: Total operating expenses for the six months ended June 30, 2021 were $16.2 million, a $1.1 million, or 7.6%, increase from $15.1 million in the same period in 2020.

GAAP Net Loss: Net loss for the six months ended June 30, 2021 was ($4.9) million, or ($0.20) per diluted share, as compared to a net loss of ($14.2) million, or ($0.67) per diluted share, for the same period in 2020. GAAP Net Loss in 2020 included a $7.5 million charge related to the losses on fair value of convertible debentures.

Non-GAAP Adjusted Net Loss: Non-GAAP Adjusted Net Loss, a non-GAAP financial measure as defined below, for the first half of 2021 was ($4.4) million, or ($0.18) per diluted share, as compared to a Non-GAAP Adjusted Net Loss of ($6.4) million, or ($0.30) per diluted share, for the first half of 2020. Please refer to the section entitled “Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Measures” and the accompanying financial table included at the end of this release for a reconciliation of GAAP Net Loss to Non-GAAP Adjusted Net Loss results for the six-month periods ended June 30, 2021 and 2020, respectively.

Non-GAAP Adjusted EBITDA: Non-GAAP Adjusted EBITDA, a non-GAAP financial measure as defined below, for the first half of 2021 was a loss of ($2.6) million, a $1.2 million decrease as compared to the first half 2020 Non-GAAP Adjusted EBITDA loss of ($3.8) million. Please refer to the section entitled “Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Measures” and the accompanying financial table included at the end of this release for a reconciliation of GAAP Net Loss to Non-GAAP Adjusted EBITDA results for the six-month periods ended June 30, 2021 and 2020, respectively.

Use of Non-GAAP Financial Measures


In its quarterly news releases, conference calls, slide presentations or webcasts, the Company may use or discuss non-GAAP financial measures as defined by SEC Regulation G. The GAAP financial measures most directly comparable to each non-GAAP financial measure used or discussed, and a reconciliation of the differences between each non-GAAP financial measure and the comparable GAAP financial measure, are included in this press release after the condensed consolidated financial statements. When analyzing the Company’s operating performance, investors should not consider these non-GAAP measures as a substitute for the comparable financial measures prepared in accordance with GAAP. The Company’s quarterly news releases containing such non-GAAP reconciliations can be found on the Investors section of the Company’s website at www.icadmed.com.

About iCAD, Inc.


Headquartered in Nashua, NH, iCAD is a global medical technology leader providing innovative cancer detection and therapy solutions. For more information, visit

www.icadmed.com

.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995


Certain statements contained in this News Release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. For example, when the Company discusses the potential of ProFound AI

^®

Risk, the benefits of the Company’s products, the Enterprise sales cycle, trends driving positive shifts, and clinical plans and updates, it is using forward-looking statements. Such forward-looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited, to the Company’s ability to achieve business and strategic objectives, increase sales and acceptance of products, adoption by CMS of a new payment model, and that such model will prove beneficial to the Company, which is not assured, implement expansion plans, the risks of uncertainty of patent protection, the impact of supply and manufacturing constraints or difficulties, uncertainty of future sales levels, protection of patents and other proprietary rights, the impact of supply and manufacturing constraints or difficulties, product market acceptance, possible technological obsolescence of products, increased competition, to successfully defend itself in litigation matters, government regulation, changes in Medicare or other reimbursement policies, risks relating to our existing and future debt obligations, competitive factors, the effects of a decline in the economy or markets served by the Company; the effects of a global pandemic, and other risks detailed in the Company’s filings with the Securities and Exchange Commission. The words “believe,” “demonstrate,” “intend,” “expect,” “estimate,” “will,” “continue,” “anticipate,” “likely,” “seek,” and similar expressions identify forward-looking statements. Readers are cautioned not to place undue reliance on those forward-looking statements, which speak only as of the date the statement was made. The Company is under no obligation to provide any updates to any information contained in this release. For additional disclosure regarding these and other risks faced by iCAD, please see the disclosure contained in our public filings with the Securities and Exchange Commission, available on the Investors section of our website at http://www.icadmed.com and on the SEC’s website at

http://www.sec.gov

.

Contact:


Media Inquiries:

Jessica Burns, iCAD

1-201-423-4492


[email protected]

Investor Relations:

Jeremy Feffer, LifeSci Advisors

+ 1-212-915-2568


[email protected]

Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Measures


The Company reports its financial results in accordance with United States generally accepted accounting principles, or GAAP. However, management believes that in order to understand the Company’s short-term and long-term financial and operational trends, investors may wish to consider the impact of certain non-cash or non-recurring items, when used as a supplement to financial performance measures in accordance with GAAP. These items result from facts and circumstances that vary in frequency and/or impact on continuing operations. Management also uses results of operations before such items to evaluate the operating performance of the Company and compare it against past periods, make operating decisions, and serve as a basis for strategic planning. These non-GAAP financial measures provide management with additional means to understand and evaluate the operating results and trends in the Company’s ongoing business by eliminating certain non-cash expenses and other items that management believes might otherwise make comparisons of the Company’s ongoing business with prior periods more difficult, obscure trends in ongoing operations or reduce management’s ability to make useful forecasts. Management believes that these non-GAAP financial measures provide additional means of evaluating period-over-period operating performance. In addition, management understands that some investors and financial analysts find this information helpful in analyzing the Company’s financial and operational performance and comparing this performance to its peers and competitors.

Management defines “Non-GAAP Adjusted EBITDA” as the sum of GAAP Net Loss before provisions for interest expense, other income, stock-based compensation expense, depreciation and amortization, tax expense, severance, gain on sale of assets, loss on disposal of assets, acquisition and litigation related expenses. Management considers this non-GAAP financial measure to be an indicator of the Company’s operational strength and performance of its business and a good measure of its historical operating trends, in particular the extent to which ongoing operations impact the Company’s overall financial performance.

The non-GAAP financial measures do not replace the presentation of the Company’s GAAP financial results and should only be used as a supplement to, not as a substitute for, the Company’s financial results presented in accordance with GAAP. The Company has provided a reconciliation of each non-GAAP financial measure used in its financial reporting and investor presentations to the most directly comparable GAAP financial measure.

Management excludes each of the items identified below from the applicable non-GAAP financial measure referenced above for the reasons set forth with respect to that excluded item:

• Interest expense: The Company excludes interest expense which includes interest from the facility agreement, interest on capital leases and interest on the convertible debentures from its non-GAAP Adjusted EBITDA calculation.
• Stock-based compensation expense: excluded as these are non-cash expenses that management does not consider part of ongoing operating results when assessing the performance of the Company’s business, and also because the total amount of expense is partially outside of the Company’s control as it is based on factors such as stock price volatility and interest rates, which may be unrelated to our performance during the period in which the expense is incurred.
• Tax Expense: The Company excludes this non-cash item from the 2020 periods as it was not considered by management in making operating decisions, and management believes that such item does not have a direct correlation to future business operations. In January 2021, the Company adopted ASU 2019-12 requiring these taxes be moved to operating expenses and are no longer excluded.
• CARES Act Credit: The Company excludes this item as it is related to COVID-19 legislation that does not have a direct correlation to future business operations, as this item was in direct response to the initial wave of the COVID-19 pandemic.
• Severance and Furlough: The Company excludes this item as it is related to COVID-19 business impact that does not have a direct correlation to future business operations, as this item was in direct response to the initial wave of the COVID-19 pandemic.
• Amortization and Depreciation: Purchased assets and intangibles are amortized over a period of several years and generally cannot be changed or influenced by management after they are acquired. Accordingly, these non-cash items are not considered by management in making operating decisions, and management believes that such expenses do not have a direct correlation to future business operations. Thus, including such charges does not accurately reflect the performance of the Company’s ongoing operations for the period in which such charges are incurred.
• Loss on fair value of convertible debentures. The Company excludes this non-cash item as it is not considered by management in making operating decisions, and management believes that such item does not have a direct correlation to future business operations.
• Litigation related: These expenses consist primarily of settlement, legal and other professional fees related to litigation. The Company excludes these costs from its non-GAAP measures primarily because the Company believes that these costs have no direct correlation to the core operations of the Company.
• Loss on extinguishment of debt: The Company excludes this non-cash item as it is not considered by management in making operating decisions, and management believes that such item does not have a direct correlation to future business operations.
  

On occasion in the future, there may be other items, such as significant asset impairments, restructuring charges or significant gains or losses from contingencies that the Company may exclude if it believes that doing so is consistent with the goal of providing useful information to investors and management.