Delaware (State or other jurisdiction of incorporation or organization) | 13-3986004 (I.R.S. Employer Identification No.) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Common Stock, $0.001 par value per share | SSKN | The NASDAQ Stock Market LLC |
Large accelerated filer ☐ | Accelerated filer ☐ | |||
Non-accelerated filer ☒ | Smaller reporting company ☒ | |||
Emerging growth company ☐ |
March 31, 2023 | December 31, 2022 | |||||||||||||||
September 30, 2022 | December 31, 2021 | (unaudited) | ||||||||||||||
Assets | (unaudited) | |||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 7,454 | $ | 12,586 | $ | 2,825 | $ | 5,434 | ||||||||
Restricted cash | 1,361 | - | 1,361 | 1,361 | ||||||||||||
Accounts receivable, net of allowance for doubtful accounts of $299 and $275 at September 30, 2022 and December 31, 2021, respectively | 3,655 | 3,433 | ||||||||||||||
Accounts receivable, net of allowance for doubtful accounts of $242 and $382 at March 31, 2023 and December 31, 2022, respectively | 3,940 | 4,471 | ||||||||||||||
Inventories | 5,662 | 3,489 | 5,695 | 5,547 | ||||||||||||
Prepaid expenses and other current assets | 621 | 462 | 691 | 691 | ||||||||||||
Total current assets | 18,753 | 19,970 | 14,512 | 17,504 | ||||||||||||
Property and equipment, net | 6,566 | 6,883 | 8,182 | 7,498 | ||||||||||||
Operating lease right-of-use assets | 836 | 638 | 870 | 975 | ||||||||||||
Intangible assets, net | 18,110 | 10,083 | 16,674 | 17,394 | ||||||||||||
Goodwill | 8,803 | 8,803 | 8,803 | 8,803 | ||||||||||||
Other assets | 167 | 216 | 82 | 98 | ||||||||||||
Total assets | $ | 53,235 | $ | 46,593 | $ | 49,123 | $ | 52,272 | ||||||||
Liabilities and Stockholders’ Equity | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable | $ | 4,369 | $ | 2,822 | $ | 3,099 | $ | 3,425 | ||||||||
Accrued expenses and other current liabilities | 6,075 | 6,377 | 6,549 | 6,555 | ||||||||||||
Deferred revenues | 2,968 | 3,285 | 2,548 | 2,778 | ||||||||||||
Current portion of operating lease liabilities | 246 | 318 | 381 | 355 | ||||||||||||
Current portion of contingent consideration | 500 | - | 481 | 313 | ||||||||||||
Total current liabilities | 14,158 | 12,802 | 13,058 | 13,426 | ||||||||||||
Long-term debt | 7,435 | 7,319 | ||||||||||||||
Long-term debt, net | 7,517 | 7,476 | ||||||||||||||
Deferred revenues and other liabilities | 280 | 400 | 305 | 314 | ||||||||||||
Deferred tax liability | 266 | 266 | 306 | 306 | ||||||||||||
Operating lease liabilities net of current portion | 674 | 392 | ||||||||||||||
Operating lease liabilities, net of current portion | 489 | 610 | ||||||||||||||
Contingent consideration, net of current portion | 8,622 | - | 8,127 | 8,309 | ||||||||||||
Total liabilities | 31,435 | 21,179 | 29,802 | 30,441 | ||||||||||||
Commitments and contingencies (Note 14) | ||||||||||||||||
Stockholders’ equity: | ||||||||||||||||
Series C convertible preferred stock, $0.10 par value; 10,000,000 shares authorized; no shares issued and outstanding | - | - | ||||||||||||||
Common stock, $0.001 par value, 150,000,000 shares authorized; 34,723,046 and 34,364,679 shares issued and outstanding at September 30, 2022 and December 31, 2021, respectively | 35 | 34 | ||||||||||||||
Series C convertible preferred stock, $0.10 par value; 10,000,000 shares authorized; no shares issued and outstanding | — | — | ||||||||||||||
Common stock, $0.001 par value; 150,000,000 shares authorized; 34,881,453 and 34,723,046 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 35 | 35 | ||||||||||||||
Additional paid-in capital | 248,833 | 247,059 | 249,349 | 249,024 | ||||||||||||
Accumulated deficit | (227,068 | ) | (221,679 | ) | (230,063 | ) | (227,228 | ) | ||||||||
Total stockholders’ equity | 21,800 | 25,414 | 19,321 | 21,831 | ||||||||||||
Total liabilities and stockholders’ equity | $ | 53,235 | $ | 46,593 | $ | 49,123 | $ | 52,272 |
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Revenues, net | $ | 7,567 | $ | 7,041 | ||||
Cost of revenues | 3,179 | 2,913 | ||||||
Gross profit | 4,388 | 4,128 | ||||||
Operating expenses: | ||||||||
Engineering and product development | 315 | 163 | ||||||
Selling and marketing | 3,742 | 3,616 | ||||||
General and administrative | 2,917 | 2,652 | ||||||
6,974 | 6,431 | |||||||
Loss from operations | (2,586 | ) | (2,303 | ) | ||||
Other (expense) income: | ||||||||
Interest expense | (286 | ) | (199 | ) | ||||
Interest income | 37 | — | ||||||
(249 | ) | (199 | ) | |||||
Net loss | $ | (2,835 | ) | $ | (2,502 | ) | ||
Net loss per share of common stock, basic and diluted | $ | (0.08 | ) | $ | (0.07 | ) | ||
Weighted average shares of common stock outstanding, basic and diluted | 34,862,092 | 34,679,246 |
Additional | Total | |||||||||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||
Balance at January 1, 2023 | 34,723,046 | $ | 35 | $ | 249,024 | $ | (227,228 | ) | $ | 21,831 | ||||||||||
Stock-based compensation expense | — | — | 325 | — | 325 | |||||||||||||||
Issuance of restricted stock | 158,407 | — | — | — | — | |||||||||||||||
Net loss | — | — | — | (2,835 | ) | (2,835 | ) | |||||||||||||
Balance at March 31, 2023 | 34,881,453 | $ | 35 | $ | 249,349 | $ | (230,063 | ) | $ | 19,321 |
For the Three Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Revenues, net | $ | 9,413 | $ | 7,711 | ||||
Cost of revenues | 3,614 | 2,335 | ||||||
Gross profit | 5,799 | 5,376 | ||||||
Operating expenses: | ||||||||
Engineering and product development | 216 | 371 | ||||||
Selling and marketing | 3,754 | 3,295 | ||||||
General and administrative | 2,615 | 2,175 | ||||||
6,585 | 5,841 | |||||||
Loss from operations | (786 | ) | (465 | ) | ||||
Other income (expense): | ||||||||
Interest expense | (244 | ) | (53 | ) | ||||
Interest income | 35 | 1 | ||||||
(209 | ) | (52 | ) | |||||
Loss before income taxes | (995 | ) | (517 | ) | ||||
Income tax expense | - | (4 | ) | |||||
Net loss | $ | (995 | ) | $ | (521 | ) | ||
Net loss per share of common stock, basic and diluted | $ | (0.03 | ) | $ | (0.02 | ) | ||
Weighted average shares of common stock outstanding, basic and diluted | 34,723,046 | 34,150,438 |
Additional | Total | |||||||||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||
Balance at January 1, 2022 | 34,364,679 | $ | 34 | $ | 247,059 | $ | (221,679 | ) | $ | 25,414 | ||||||||||
Stock-based compensation expense | — | — | 368 | — | 368 | |||||||||||||||
Issuance of common stock for acquisition | 358,367 | 1 | 499 | — | 500 | |||||||||||||||
Net loss | — | — | — | (2,502 | ) | (2,502 | ) | |||||||||||||
Balance at March 31, 2022 | 34,723,046 | $ | 35 | $ | 247,926 | $ | (224,181 | ) | $ | 23,780 |
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (2,835 | ) | $ | (2,502 | ) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation and amortization | 1,397 | 1,321 | ||||||
Amortization of operating lease right-of-use assets | 105 | 89 | ||||||
Amortization of deferred financing costs and debt discount | 41 | 37 | ||||||
(Recoveries of) provision for doubtful accounts | (95 | ) | 13 | |||||
Stock-based compensation expense | 325 | 368 | ||||||
Loss on disposal of property and equipment | — | 17 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | 626 | 448 | ||||||
Inventories | (103 | ) | (1,198 | ) | ||||
Prepaid expenses and other assets | 16 | 85 | ||||||
Accounts payable | (326 | ) | 1,148 | |||||
Accrued expenses and other liabilities | (12 | ) | 175 | |||||
Deferred revenues | (247 | ) | (257 | ) | ||||
Operating lease liabilities | (95 | ) | (97 | ) | ||||
Net cash used in operating activities | (1,203 | ) | (353 | ) | ||||
Cash flows from investing activities: | ||||||||
Purchase of property and equipment | (1,406 | ) | (679 | ) | ||||
Cash paid in connection with TheraClear asset acquisition | — | (631 | ) | |||||
Net cash used in investing activities | (1,406 | ) | (1,310 | ) | ||||
Net decrease in cash, cash equivalents and restricted cash | (2,609 | ) | (1,663 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of period | 6,795 | 12,586 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 4,186 | $ | 10,923 | ||||
Cash and cash equivalents | $ | 2,825 | $ | 10,923 | ||||
Restricted cash | 1,361 | — | ||||||
$ | 4,186 | $ | 10,923 | |||||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid for interest | $ | 241 | $ | 160 | ||||
Supplemental disclosure of non-cash operating, investing and financing activities: | ||||||||
Inventories acquired in connection with TheraClear asset acquisition | $ | — | $ | 71 | ||||
Intangible assets acquired in connection with TheraClear asset acquisition | $ | — | $ | 10,182 | ||||
Contingent consideration issued in connection with TheraClear asset acquisition | $ | — | $ | 9,122 | ||||
Common stock issued in connection with TheraClear asset acquisition | $ | — | $ | 500 | ||||
Transfer of property and equipment to inventories | $ | 45 | $ | — | ||||
Accrued payment of contingent consideration | $ | 14 | $ | — |
For the Nine Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Revenues, net | $ | 25,559 | $ | 20,920 | ||||
Cost of revenues | 10,639 | 7,070 | ||||||
Gross profit | 14,920 | 13,850 | ||||||
Operating expenses: | ||||||||
Engineering and product development | 588 | 1,158 | ||||||
Selling and marketing | 11,516 | 9,387 | ||||||
General and administrative | 7,599 | 7,085 | ||||||
19,703 | 17,630 | |||||||
Loss from operations | (4,783 | ) | (3,780 | ) | ||||
Other income (expense): | ||||||||
Gain on debt extinguishment | - | 2,028 | ||||||
Interest expense | (651 | ) | (109 | ) | ||||
Interest income | 45 | 16 | ||||||
(606 | ) | 1,935 | ||||||
Loss before income taxes | (5,389 | ) | (1,845 | ) | ||||
Income tax expense | - | (12 | ) | |||||
Net loss | $ | (5,389 | ) | $ | (1,857 | ) | ||
Net loss per share of common stock, basic and diluted | $ | (0.16 | ) | $ | (0.05 | ) | ||
Weighted average shares of common stock outstanding, basic and diluted | 34,708,606 | 33,944,321 |
Common Stock | Additional Paid-In | Accumulated | Total Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||
Balance at January 1, 2022 | 34,364,679 | $ | 34 | $ | 247,059 | $ | (221,679 | ) | $ | 25,414 | ||||||||||
Stock-based compensation | - | - | 368 | - | 368 | |||||||||||||||
Issuance of common stock for acquisition | 358,367 | 1 | 499 | - | 500 | |||||||||||||||
Net loss | - | - | - | (2,502 | ) | (2,502 | ) | |||||||||||||
Balance at March 31, 2022 | 34,723,046 | 35 | 247,926 | (224,181 | ) | 23,780 | ||||||||||||||
Stock-based compensation | - | - | 452 | - | 452 | |||||||||||||||
Net loss | - | - | - | (1,892 | ) | (1,892 | ) | |||||||||||||
Balance at June 30, 2022 | 34,723,046 | 35 | 248,378 | (226,073 | ) | 22,340 | ||||||||||||||
Stock-based compensation | - | - | 455 | - | 455 | |||||||||||||||
Net loss | - | - | - | (995 | ) | (995 | ) | |||||||||||||
Balance at September 30, 2022 | 34,723,046 | $ | 35 | $ | 248,833 | $ | (227,068 | ) | $ | 21,800 |
Common Stock | Additional Paid-In | Accumulated | Total Stockholders’ | |||||||||||||||||
Shares | Amount | Capital | Deficit | Equity | ||||||||||||||||
Balance at January 1, 2021 | 33,801,045 | $ | 34 | $ | 244,831 | $ | (218,973 | ) | $ | 25,892 | ||||||||||
Stock-based compensation | - | - | 662 | - | 662 | |||||||||||||||
Issuance of restricted stock | 16,260 | - | - | - | - | |||||||||||||||
Net loss | - | - | - | (2,418 | ) | (2,418 | ) | |||||||||||||
Balance at March 31, 2021 | 33,817,305 | 34 | 245,493 | (221,391 | ) | 24,136 | ||||||||||||||
Stock-based compensation | - | - | 581 | - | 581 | |||||||||||||||
Issuance of restricted stock | 71,934 | - | - | - | - | |||||||||||||||
Net income | - | - | - | 1,082 | 1,082 | |||||||||||||||
Balance at June 30, 2021 | 33,889,239 | 34 | 246,074 | (220,309 | ) | 25,799 | ||||||||||||||
Stock-based compensation | - | - | 320 | - | 320 | |||||||||||||||
Exercise of stock options | 329,076 | - | - | - | - | |||||||||||||||
Issuance of restricted stock | 146,364 | - | - | - | - | |||||||||||||||
Issuance of warrants | - | - | 585 | - | 585 | |||||||||||||||
Net loss | - | - | - | (521 | ) | (521 | ) | |||||||||||||
Balance at September 30, 2021 | 34,364,679 | $ | 34 | $ | 246,979 | $ | (220,830 | ) | $ | 26,183 |
For the Nine Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Cash flows from operating activities: | ||||||||
Net loss | $ | (5,389 | ) | $ | (1,857 | ) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||
Amortization of intangible assets | 2,155 | 1,113 | ||||||
Amortization of operating lease right-of-use assets | 248 | 261 | ||||||
Depreciation and amortization | 1,816 | 1,576 | ||||||
Amortization of deferred financing costs and debt discount | 116 | - | ||||||
Provision (recoveries) for doubtful accounts | 24 | (26 | ) | |||||
Stock-based compensation | 1,275 | 1,563 | ||||||
Loss on disposal of property and equipment | 52 | 73 | ||||||
Gain on debt extinguishment | - | (2,028 | ) | |||||
Deferred taxes | - | 12 | ||||||
Changes in operating assets and liabilities: | ||||||||
Accounts receivable | (246 | ) | (181 | ) | ||||
Inventories | (1,616 | ) | 219 | |||||
Prepaid expenses and other assets | (110 | ) | (243 | ) | ||||
Accounts payable | 1,547 | (284 | ) | |||||
Accrued expenses and other liabilities | (267 | ) | 858 | |||||
Deferred revenues | (472 | ) | 58 | |||||
Operating lease liabilities | (236 | ) | (275 | ) | ||||
Net cash (used in) provided by operating activities | (1,103 | ) | 839 | |||||
Cash flows from investing activities: | ||||||||
Purchase of property and equipment | (2,037 | ) | (2,523 | ) | ||||
Cash paid in connection with TheraClear asset acquisition | (631 | ) | - | |||||
Cash paid in connection with Ra Medical asset acquisition | - | (3,473 | ) | |||||
Net cash used in investing activities | (2,668 | ) | (5,996 | ) | ||||
Cash flows from financing activities: | ||||||||
Proceeds from long-term debt | - | 8,000 | ||||||
Payment of deferred financing costs | - | (133 | ) | |||||
Repayment of note payable | - | (7,275 | ) | |||||
Repayment of long-term debt | - | (500 | ) | |||||
Net cash provided by financing activities | - | 92 | ||||||
Net decrease in cash, cash equivalents and restricted cash | (3,771 | ) | (5,065 | ) | ||||
Cash, cash equivalents and restricted cash, beginning of period | 12,586 | 18,112 | ||||||
Cash, cash equivalents and restricted cash, end of period | $ | 8,815 | $ | 13,047 | ||||
Cash and cash equivalents | $ | 7,454 | $ | 13,047 | ||||
Restricted cash | 1,361 | - | ||||||
$ | 8,815 | $ | 13,047 | |||||
Supplemental disclosure of cash flow information: | ||||||||
Cash paid for interest | $ | 523 | $ | 109 | ||||
Supplemental disclosure of non-cash operating, investing and financing activities: | ||||||||
Change in operating lease right-of-use assets and liability due to amended lease | $ | 446 | $ | - | ||||
Inventories acquired in connection with TheraClear asset acquisition | $ | 71 | $ | - | ||||
Intangible assets acquired in connection with TheraClear asset acquisition | $ | 10,182 | $ | - | ||||
Contingent consideration issued in connection with TheraClear asset acquisition | $ | 9,122 | $ | - | ||||
Common stock issued in connection with TheraClear asset acquisition | $ | 500 | $ | - | ||||
Transfer of property and equipment to inventories | $ | 486 | $ | - | ||||
Fair value of warrants issued in connection with debt | $ | - | $ | 585 | ||||
Assumed deferred revenue in connection with Ra Medical asset acquisition | $ | - | $ | 1,841 |
• | Level 1 – quoted market prices in active markets for identical assets or liabilities. | |
• | Level 2 – observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |
• | Level 3 – inputs that are generally unobservable and typically reflect the Company’s estimate of assumptions that market participants would use in pricing the asset or liability. |
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Balance, beginning of period | $ | 207 | $ | 79 | ||||
Additions | 27 | 34 | ||||||
Expirations and claims satisfied | (5 | ) | (14 | ) | ||||
Total | 229 | 99 | ||||||
Less current portion within accrued expenses and other current liabilities | (152 | ) | (66 | ) | ||||
Balance within deferred revenues and other liabilities | $ | 77 | $ | 33 |
September 30, | ||||||||
2022 | 2021 | |||||||
Restricted stock units | 278,004 | 144,497 | ||||||
Stock options | 4,544,714 | 3,963,889 | ||||||
Common stock warrants | 373,626 | 373,626 | ||||||
Total | 5,196,344 | 4,482,012 |
March 31, | ||||||||
2023 | 2022 | |||||||
Restricted stock units | 119,597 | 89,681 | ||||||
Stock options | 4,464,714 | 4,434,714 | ||||||
Common stock warrants | 373,626 | 373,626 | ||||||
Total | 4,957,937 | 4,898,021 |
• | identification of the contract, or contracts, with a customer; | |
• | identification of the performance obligations in the contract; | |
• | determination of the transaction price; | |
• | allocation of the transaction price to the performance obligations in the contract; and | |
• | recognition of revenue when, or as, performance obligations are satisfied. |
Remaining 2022 | $ | 313 | ||||||
2023 | 1,193 | |||||||
Remaining 2023 | $ | 914 | ||||||
2024 | 835 | 975 | ||||||
2025 | 218 | 384 | ||||||
2026 | 4 | 166 | ||||||
2027 | 4 | |||||||
Total | $ | 2,563 | $ | 2,443 |
Consideration: | ||||
Cash payment | $ | 500 | ||
Common stock issued | 500 | |||
Transaction costs | 131 | |||
Contingent consideration | 9,122 | |||
Total consideration | $ | 10,253 | ||
Assets acquired: | ||||
Technology intangible asset | $ | 10,182 | ||
Inventories | 71 | |||
Total assets acquired | $ | 10,253 |
Consideration: | ||||
Cash payment | $ | 3,700 | ||
Transaction costs | 57 | |||
Total consideration | $ | 3,757 | ||
Assets acquired: | ||||
Inventories | $ | 284 | ||
Customer lists intangible asset | 5,314 | |||
Total assets acquired | 5,598 | |||
Liabilities assumed: | ||||
Deferred revenues – service contracts | 1,841 | |||
Total liabilities assumed | 1,841 | |||
Net assets acquired | $ | 3,757 |
September 30, 2022 | December 31, 2021 | March 31, 2023 | December 31, 2022 | |||||||||||||
Raw materials and work-in-process | $ | 5,426 | $ | 3,201 | $ | 5,295 | $ | 5,418 | ||||||||
Finished goods | 236 | 288 | 400 | 129 | ||||||||||||
Total inventories | $ | 5,662 | $ | 3,489 | $ | 5,695 | $ | 5,547 |
September 30, 2022 | December 31, 2021 | March 31, 2023 | December 31, 2022 | |||||||||||||
Lasers placed-in-service | $ | 27,360 | $ | 25,949 | ||||||||||||
Dermatology devices placed-in-service | $ | 29,988 | $ | 28,790 | ||||||||||||
Equipment, computer hardware and software | 293 | 238 | 293 | 293 | ||||||||||||
Furniture and fixtures | 235 | 213 | 235 | 235 | ||||||||||||
Leasehold improvements | 80 | 254 | 115 | 136 | ||||||||||||
27,968 | 26,654 | 30,631 | 29,454 | |||||||||||||
Accumulated depreciation and amortization | (21,402 | ) | (19,771 | ) | (22,449 | ) | (21,956 | ) | ||||||||
Property and equipment, net | $ | 6,566 | $ | 6,883 | $ | 8,182 | $ | 7,498 |
Balance | Accumulated Amortization | Intangible Assets, net | ||||||||||
March 31, 2023 | ||||||||||||
Core technology | $ | 5,700 | $ | (4,418 | ) | $ | 1,282 | |||||
Product technology | 12,182 | (3,273 | ) | 8,909 | ||||||||
Customer relationships | 6,900 | (5,348 | ) | 1,552 | ||||||||
Tradenames | 1,500 | (1,163 | ) | 337 | ||||||||
Pharos customer lists | 5,314 | (720 | ) | 4,594 | ||||||||
$ | 31,596 | $ | (14,922 | ) | $ | 16,674 | ||||||
December 31, 2022 | ||||||||||||
Core technology | $ | 5,700 | $ | (4,275 | ) | $ | 1,425 | |||||
Product technology | 12,182 | (3,018 | ) | 9,164 | ||||||||
Customer relationships | 6,900 | (5,175 | ) | 1,725 | ||||||||
Tradenames | 1,500 | (1,125 | ) | 375 | ||||||||
Pharos customer lists | 5,314 | (609 | ) | 4,705 | ||||||||
$ | 31,596 | $ | (14,202 | ) | $ | 17,394 |
Balance | Accumulated Amortization | Intangible Assets, net | ||||||||||
Core technology | $ | 5,700 | $ | (4,133 | ) | $ | 1,567 | |||||
Product technology | 12,182 | (2,764 | ) | 9,418 | ||||||||
Customer relationships | 6,900 | (5,003 | ) | 1,897 | ||||||||
Tradenames | 1,500 | (1,088 | ) | 412 | ||||||||
Pharos customer lists | 5,314 | (498 | ) | 4,816 | ||||||||
$ | 31,596 | $ | (13,486 | ) | $ | 18,110 |
Balance | Accumulated Amortization | Intangible Assets, net | ||||||||||
Core technology | $ | 5,700 | $ | (3,705 | ) | $ | 1,995 | |||||
Product technology | 2,000 | (2,000 | ) | - | ||||||||
Customer relationships | 6,900 | (4,485 | ) | 2,415 | ||||||||
Tradenames | 1,500 | (975 | ) | 525 | ||||||||
Pharos customer lists | 5,314 | (166 | ) | 5,148 | ||||||||
$ | 21,414 | $ | (11,331 | ) | $ | 10,083 |
Remaining 2022 | $ | 717 | ||||||
2023 | 2,871 | |||||||
Remaining 2023 | $ | 2,151 | ||||||
2024 | 2,871 | 2,871 | ||||||
2025 | 2,166 | 2,166 | ||||||
2026 | 1,461 | 1,461 | ||||||
2027 | 1,461 |
September 30, 2022 | December 31, 2021 | |||||||||||||||
March 31, 2023 | December 31, 2022 | |||||||||||||||
Warranty obligations | $ | 118 | $ | 59 | $ | 152 | $ | 136 | ||||||||
Compensation and related benefits | 1,379 | 2,052 | 2,165 | 1,997 | ||||||||||||
State sales, use and other taxes | 3,742 | 3,697 | 4,043 | 3,986 | ||||||||||||
Professional fees and other | 836 | 569 | 189 | 436 | ||||||||||||
Total accrued expenses and other current liabilities | $ | 6,075 | $ | 6,377 | $ | 6,549 | $ | 6,555 |
2024 | $ | 1,000 | ||
2025 | 4,000 | |||
2026 | 3,000 | |||
Total | $ | 8,000 |
Number of shares | Weighted average exercise price per share | Weighted average remaining contractual term (years) | ||||||||||
Outstanding at January 1, 2022 | 3,938,613 | $ | 1.90 | |||||||||
Granted | 970,000 | $ | 1.43 | |||||||||
Exercised | (15,000 | ) | $ | 1.29 | ||||||||
Forfeited and expired | (348,899 | ) | $ | 2.97 | ||||||||
Outstanding at September 30, 2022 | 4,544,714 | $ | 1.72 | 8.3 | ||||||||
Exercisable at September 30, 2022 | 1,771,742 | $ | 1.88 | 7.4 | ||||||||
Vested and expected to vest | 4,544,714 | $ | 1.72 | 8.3 |
Number of Shares | Weighted Average Exercise Price per Share | Weighted Average Remaining Contractual Term (in years) | ||||||||||
Outstanding at January 1, 2023 | 4,474,714 | $ | 1.72 | |||||||||
Granted | — | $ | — | |||||||||
Exercised | — | $ | — | |||||||||
Forfeited and expired | (10,000 | ) | $ | 1.45 | ||||||||
Outstanding at March 31, 2023 | 4,464,714 | $ | 1.72 | 7.8 | ||||||||
Exercisable at March 31, 2023 | 2,623,841 | $ | 1.82 | 7.3 | ||||||||
Vested and expected to vest | 4,464,714 | $ | 1.72 | 7.8 |
Number of shares | Weighted average grant date fair value | Number of Shares | Weighted Average Grant Date Fair Value | |||||||||||||
Unvested at January 1, 2022 | 90,540 | $ | 1.45 | |||||||||||||
Unvested at January 1, 2023 | 119,597 | $ | 0.93 | |||||||||||||
Granted | 187,464 | $ | 0.96 | — | $ | — | ||||||||||
Vested | (118,543 | ) | $ | 1.37 | (39,866 | ) | $ | 0.93 | ||||||||
Unvested at September 30, 2022 | 159,461 | $ | 0.93 | |||||||||||||
Unvested at March 31, 2023 | 79,731 | $ | 0.93 |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Three Months Ended March 31, 2023 | ||||||||||||
Revenues, net | $ | 5,209 | $ | 2,358 | $ | 7,567 | ||||||
Cost of revenues | 2,020 | 1,159 | 3,179 | |||||||||
Gross profit | 3,189 | 1,199 | 4,388 | |||||||||
Gross profit % | 61.2 | % | 50.8 | % | 58.0 | % | ||||||
Allocated expenses: | ||||||||||||
Engineering and product development | 245 | 70 | 315 | |||||||||
Selling and marketing | 3,353 | 389 | 3,742 | |||||||||
Unallocated expenses | — | — | 2,917 | |||||||||
3,598 | 459 | 6,974 | ||||||||||
(Loss) income from operations | (409 | ) | 740 | (2,586 | ) | |||||||
Interest expense | — | — | (286 | ) | ||||||||
Interest income | — | — | 37 | |||||||||
Net (loss) income | $ | (409 | ) | $ | 740 | $ | (2,835 | ) |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Revenues, net | $ | 5,847 | $ | 3,566 | $ | 9,413 | ||||||
Costs of revenues | 2,057 | 1,557 | 3,614 | |||||||||
Gross profit | 3,790 | 2,009 | 5,799 | |||||||||
Gross profit % | 64.8 | % | 56.3 | % | 61.6 | % | ||||||
Allocated operating expenses: | ||||||||||||
Engineering and product development | 139 | 77 | 216 | |||||||||
Selling and marketing | 3,296 | 458 | 3,754 | |||||||||
Unallocated operating expenses | - | - | 2,615 | |||||||||
3,435 | 535 | 6,585 | ||||||||||
Income (loss) from operations | 355 | 1,474 | (786 | ) | ||||||||
Interest expense | - | - | (244 | ) | ||||||||
Interest income | - | - | 35 | |||||||||
Income (loss) before income taxes | $ | 355 | $ | 1,474 | $ | (995 | ) |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Three Months Ended March 31, 2022 | ||||||||||||
Revenues, net | $ | 5,067 | $ | 1,974 | $ | 7,041 | ||||||
Cost of revenues | 2,032 | 881 | 2,913 | |||||||||
Gross profit | 3,035 | 1,093 | 4,128 | |||||||||
Gross profit % | 59.9 | % | 55.4 | % | 58.6 | % | ||||||
Allocated expenses: | ||||||||||||
Engineering and product development | 126 | 37 | 163 | |||||||||
Selling and marketing | 3,300 | 316 | 3,616 | |||||||||
Unallocated expenses | — | — | 2,652 | |||||||||
3,426 | 353 | 6,431 | ||||||||||
(Loss) income from operations | (391 | ) | 740 | (2,303 | ) | |||||||
Interest expense | — | — | (199 | ) | ||||||||
Net (loss) income | $ | (391 | ) | $ | 740 | $ | (2,502 | ) |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Revenues, net | $ | 16,496 | $ | 9,063 | $ | 25,559 | ||||||
Costs of revenues | 6,387 | 4,252 | 10,639 | |||||||||
Gross profit | 10,109 | 4,811 | 14,920 | |||||||||
Gross profit % | 61.3 | % | 53.1 | % | 58.4 | % | ||||||
Allocated operating expenses: | ||||||||||||
Engineering and product development | 398 | 190 | 588 | |||||||||
Selling and marketing | 10,225 | 1,291 | 11,516 | |||||||||
Unallocated operating expenses | - | - | 7,599 | |||||||||
10,623 | 1,481 | 19,703 | ||||||||||
(Loss) income from operations | (514 | ) | 3,330 | (4,783 | ) | |||||||
Interest expense | - | - | (651 | ) | ||||||||
Interest income | - | - | 45 | |||||||||
(Loss) income before income taxes | $ | (514 | ) | $ | 3,330 | $ | (5,389 | ) |
Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Dermatology recurring procedures | $ | 1,213 | $ | 1,152 | ||||
Dermatology procedures equipment | 180 | 165 | ||||||
Unallocated expenses | 4 | 4 | ||||||
Consolidated total | $ | 1,397 | $ | 1,321 |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Revenues, net | $ | 5,710 | $ | 2,001 | $ | 7,711 | ||||||
Costs of revenues | 1,512 | 823 | 2,335 | |||||||||
Gross profit | 4,198 | 1,178 | 5,376 | |||||||||
Gross profit % | 73.5 | % | 58.9 | % | 69.7 | % | ||||||
Allocated operating expenses: | ||||||||||||
Engineering and product development | 333 | 38 | 371 | |||||||||
Selling and marketing | 3,094 | 201 | 3,295 | |||||||||
Unallocated operating expenses | - | - | 2,175 | |||||||||
3,427 | 239 | 5,841 | ||||||||||
Income (loss) from operations | 771 | 939 | (465 | ) | ||||||||
Interest expense | - | - | (53 | ) | ||||||||
Interest income | - | - | 1 | |||||||||
Income (loss) before income taxes | $ | 771 | $ | 939 | $ | (517 | ) |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Three Months Ended March 31, 2023 | ||||||||||||
Domestic | $ | 4,847 | $ | 496 | $ | 5,343 | ||||||
Foreign | 362 | 1,862 | 2,224 | |||||||||
Total | $ | 5,209 | $ | 2,358 | $ | 7,567 |
Three Months Ended March 31, 2022 | ||||||||||||
Domestic | $ | 4,689 | $ | 695 | $ | 5,384 | ||||||
Foreign | 378 | 1,279 | 1,657 | |||||||||
Total | $ | 5,067 | $ | 1,974 | $ | 7,041 |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Revenues, net | $ | 15,841 | $ | 5,079 | $ | 20,920 | ||||||
Costs of revenues | 4,648 | 2,422 | 7,070 | |||||||||
Gross profit | 11,193 | 2,657 | 13,850 | |||||||||
Gross profit % | 70.7 | % | 52.3 | % | 66.2 | % | ||||||
Allocated operating expenses: | ||||||||||||
Engineering and product development | 1,013 | 145 | 1,158 | |||||||||
Selling and marketing | 8,805 | 582 | 9,387 | |||||||||
Unallocated operating expenses | - | - | 7,085 | |||||||||
9,818 | 727 | 17,630 | ||||||||||
Income (loss) from operations | 1,375 | 1,930 | (3,780 | ) | ||||||||
Gain on debt extinguishment | - | - | 2,028 | |||||||||
Interest expense | - | - | (109 | ) | ||||||||
Interest income | - | - | 16 | |||||||||
Income (loss) before income taxes | $ | 1,375 | $ | 1,930 | $ | (1,845 | ) |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Domestic | $ | 5,527 | $ | 572 | $ | 6,099 | ||||||
Foreign | 320 | 2,994 | 3,314 | |||||||||
Total | $ | 5,847 | $ | 3,566 | $ | 9,413 |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Domestic | $ | 15,393 | $ | 1,814 | $ | 17,207 | ||||||
Foreign | 1,103 | 7,249 | 8,352 | |||||||||
Total | $ | 16,496 | $ | 9,063 | $ | 25,559 |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Domestic | $ | 5,370 | $ | 519 | $ | 5,889 | ||||||
Foreign | 340 | 1,482 | 1,822 | |||||||||
Total | $ | 5,710 | $ | 2,001 | $ | 7,711 |
Dermatology Recurring Procedures | Dermatology Procedures Equipment | TOTAL | ||||||||||
Domestic | $ | 14,923 | $ | 1,113 | $ | 16,036 | ||||||
Foreign | 918 | 3,966 | 4,884 | |||||||||
Total | $ | 15,841 | $ | 5,079 | $ | 20,920 |
Amount | ||||||||
Remaining 2022 | $ | 98 | ||||||
2023 | 369 | |||||||
Remaining 2023 | $ | 330 | ||||||
2024 | 328 | 386 | ||||||
2025 | 146 | 195 | ||||||
2026 | 76 | 55 | ||||||
Total remaining lease payments | 1,017 | $ | 966 | |||||
Less: imputed interest | (97 | ) | (96 | ) | ||||
Total lease liabilities | $ | 920 | $ | 870 |
• | XTRAC® Excimer Laser. XTRAC received FDA clearance in 2000 and has since become a widely recognized treatment among dermatologists for psoriasis and other skin diseases. The XTRAC System delivers ultra-narrowband ultraviolet B (“UVB”) light to affected areas of skin. Following a series of treatments typically performed twice weekly, psoriasis remission can be achieved, and vitiligo patches can be re-pigmented. XTRAC is endorsed by the National Psoriasis Foundation, and its use for psoriasis is covered by nearly all major insurance companies, including Medicare. We estimate that more than half of all major insurance companies now offer reimbursement for vitiligo as well, a figure that is increasing. |
• | In January 2020, we announced the FDA granted clearance of our XTRAC Momentum Excimer Laser Platform. In February 2022, we announced the commercial launch, with the first installation in the U.S. market, of our next generation excimer laser system, XTRAC MomentumTM 1.0. |
• | VTRAC® Lamp. VTRAC received FDA clearance in 2005 and provides targeted therapeutic efficacy demonstrated by excimer technology with the simplicity of design and reliability of a lamp system. |
• | TheraClear® X Acne Treatment Device. The TheraClear® Acne |
For the Three Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Dermatology Recurring Procedures | $ | 5,847 | $ | 5,710 | ||||
Dermatology Procedures Equipment | 3,566 | 2,001 | ||||||
Total Revenues | $ | 9,413 | $ | 7,711 |
For the Nine Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Dermatology Recurring Procedures | $ | 16,496 | $ | 15,841 | ||||
Dermatology Procedures Equipment | 9,063 | 5,079 | ||||||
Total Revenues | $ | 25,559 | $ | 20,920 |
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Dermatology recurring procedures | $ | 5,209 | $ | 5,067 | ||||
Dermatology procedures equipment | 2,358 | 1,974 | ||||||
Total revenues | $ | 7,567 | $ | 7,041 |
For the Three Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Dermatology Recurring Procedures | $ | 2,057 | $ | 1,512 | ||||
Dermatology Procedures Equipment | 1,557 | 823 | ||||||
Total Cost of Revenues | $ | 3,614 | $ | 2,335 |
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Dermatology recurring procedures | $ | 2,020 | $ | 2,032 | ||||
Dermatology procedures equipment | 1,159 | 881 | ||||||
Total cost of revenues | $ | 3,179 | $ | 2,913 |
For the Nine Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Dermatology Recurring Procedures | $ | 6,387 | $ | 4,648 | ||||
Dermatology Procedures Equipment | 4,252 | 2,422 | ||||||
Total Cost of Revenues | $ | 10,639 | $ | 7,070 |
Company Profit Analysis | For the Three Months Ended September 30, | |||||||
2022 | 2021 | |||||||
Revenues | $ | 9,413 | $ | 7,711 | ||||
Cost of revenues | 3,614 | 2,335 | ||||||
Gross profit | $ | 5,799 | $ | 5,376 | ||||
Gross profit percentage | 61.6 | % | 69.7 | % |
Company Profit Analysis | For the Nine Months Ended September 30, | |||||||
2022 | 2021 | |||||||
Revenues | $ | 25,559 | $ | 20,920 | ||||
Cost of revenues | 10,639 | 7,070 | ||||||
Gross profit | $ | 14,920 | $ | 13,850 | ||||
Gross profit percentage | 58.4 | % | 66.2 | % |
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Revenues | $ | 7,567 | $ | 7,041 | ||||
Cost of revenues | 3,179 | 2,913 | ||||||
Gross profit | $ | 4,388 | $ | 4,128 | ||||
Gross profit percentage | 58.0 | % | 58.6 | % |
Dermatology Recurring Procedures | For the Three Months Ended September 30, | |||||||
2022 | 2021 | |||||||
Revenues | $ | 5,847 | $ | 5,710 | ||||
Cost of revenues | 2,057 | 1,512 | ||||||
Gross profit | $ | 3,790 | $ | 4,198 | ||||
Gross profit percentage | 64.8 | % | 73.5 | % |
Dermatology Recurring Procedures | For the Nine Months Ended September 30, | |||||||
2022 | 2021 | |||||||
Revenues | $ | 16,496 | $ | 15,841 | ||||
Cost of revenues | 6,387 | 4,648 | ||||||
Gross profit | $ | 10,109 | $ | 11,193 | ||||
Gross profit percentage | 61.3 | % | 70.7 | % |
For the Three Months Ended March 31, | ||||||||
2023 | 2022 | |||||||
Revenues | $ | 5,209 | $ | 5,067 | ||||
Cost of revenues | 2,020 | 2,032 | ||||||
Gross profit | $ | 3,189 | $ | 3,035 | ||||
Gross profit percentage | 61.2 | % | 59.9 | % |
Dermatology Procedures Equipment | For the Three Months Ended September 30, | |||||||
2022 | 2021 | |||||||
Revenues | $ | 3,566 | $ | 2,001 | ||||
Cost of revenues | 1,557 | 823 | ||||||
Gross profit | $ | 2,009 | $ | 1,178 | ||||
Gross profit percentage | 56.3 | % | 58.9 | % |
Dermatology Procedures Equipment | For the Nine Months Ended September 30, | |||||||||||||||
For the Three Months Ended March 31, | ||||||||||||||||
2022 | 2021 | 2023 | 2022 | |||||||||||||
Revenues | $ | 9,063 | $ | 5,079 | $ | 2,358 | $ | 1,974 | ||||||||
Cost of revenues | 4,252 | 2,422 | 1,159 | 881 | ||||||||||||
Gross profit | $ | 4,811 | $ | 2,657 | $ | 1,199 | $ | 1,093 | ||||||||
Gross profit percentage | 53.1 | % | 52.3 | % | 50.8 | % | 55.4 | % |
For the Three Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Gross profit | $ | 5,799 | $ | 5,376 | ||||
Amortization of acquired intangible assets | 507 | 144 | ||||||
Non-GAAP gross profit | $ | 6,306 | $ | 5,520 | ||||
Gross profit percentage | 61.6 | % | 69.7 | % | ||||
Non-GAAP gross profit percentage | 67.0 | % | 71.6 | % |
For the Nine Months Ended September 30, | ||||||||||||||||
2022 | 2021 | For the Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||||
Gross profit | $ | 14,920 | $ | 13,850 | $ | 4,388 | $ | 4,128 | ||||||||
Amortization of acquired intangible assets | 1,523 | 428 | 508 | 484 | ||||||||||||
Non-GAAP gross profit | $ | 16,443 | $ | 14,278 | $ | 4,896 | $ | 4,612 | ||||||||
Gross profit percentage | 58.4 | % | 66.2 | % | 58.0 | % | 58.6 | % | ||||||||
Non-GAAP gross profit percentage | 64.3 | % | 68.3 | % | 64.7 | % | 65.5 | % |
For the Three Months Ended September 30, | ||||||||||||||||
2022 | 2021 | For the Three Months Ended March 31, | ||||||||||||||
2023 | 2022 | |||||||||||||||
Net loss | $ | (995 | ) | $ | (521 | ) | $ | (2,835 | ) | $ | (2,502 | ) | ||||
Adjustments: | ||||||||||||||||
Depreciation and amortization | 1,311 | 983 | 1,397 | 1,321 | ||||||||||||
Amortization of right-of-use asset | 67 | 87 | ||||||||||||||
Amortization of operating lease right-of-use asset | 105 | 89 | ||||||||||||||
Loss on disposal of property and equipment | 17 | 10 | — | 17 | ||||||||||||
Income tax expense | - | 4 | ||||||||||||||
Interest expense, net | 209 | 52 | 249 | 199 | ||||||||||||
Non-GAAP EBITDA | 609 | 615 | (1,084 | ) | (876 | ) | ||||||||||
Stock-based compensation | 455 | 320 | ||||||||||||||
Stock-based compensation expense | 325 | 368 | ||||||||||||||
Non-GAAP adjusted EBITDA | $ | 1,064 | $ | 935 | $ | (759 | ) | $ | (508 | ) |
For the Nine Months Ended September 30, | ||||||||
2022 | 2021 | |||||||
Net loss | $ | (5,389 | ) | $ | (1,857 | ) | ||
Adjustments: | ||||||||
Depreciation and amortization | 3,971 | 2,689 | ||||||
Amortization of right-of-use asset | 248 | 261 | ||||||
Loss on disposal of property and equipment | 52 | 73 | ||||||
Income tax expense | - | 12 | ||||||
Gain on debt extinguishment | - | (2,028 | ) | |||||
Interest expense, net | 606 | 93 | ||||||
Non-GAAP EBITDA | (512 | ) | (757 | ) | ||||
Stock-based compensation | 1,275 | 1,563 | ||||||
Non-GAAP adjusted EBITDA | $ | 763 | $ | 806 |
Rule 13a-14(a) Certificate of Chief Executive Officer (attached hereto) | ||
Rule 13a-14(a) Certificate of Chief Financial Officer (attached hereto) | ||
Certifications of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (attached hereto) | ||
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Schema | |
101.CAL | XBRL Taxonomy Calculation Linkbase | |
101.DEF | XBRL Taxonomy Definition Linkbase | |
101.LAB | XBRL Taxonomy Label Linkbase | |
101.PRE | XBRL Taxonomy Presentation Linkbase |
* | The certifications attached as Exhibit 32.1 accompany this Quarterly Report on Form 10-Q pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed “filed” by the Registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. |
STRATA SKIN SCIENCES, INC. | ||||
Date | By: | /s/ Robert J. Moccia | ||
Robert J. Moccia | ||||
President & Chief Executive Officer |
Date May 15, 2023 | By: | /s/ Christopher Lesovitz | ||
Name: | ||||
Title: | ||||