STXS - Earnings call transcript Q3 2019

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Operator

Good morning. Thank you for joining us for the Stereotaxis Third Quarter 2019 Earnings Conference Call.

Certain statements during the conference call and the question-and-answer period to follow may relate to future events, expectations and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the company in the future to be materially different from the statements that the company's executives may make today. These risks are described in detail in our public filings with the Securities and Exchange Commission, including our latest periodic report on Form 10-K and 10-Q. to statements. duty no assume update these We [Operator Instructions].

being a today's is reminder, call recorded. As

my the Stereotaxis. It your to is pleasure now turn Fischel, and ahead. host, Chairman floor CEO go of Please David to over

David Fischel

in you, progress of Peery, these Chief collaboration. discuss commercial were each growth in the Kim we productive reengagement I'll and today several innovation as energetic remarks, markets, line prepared industry The our and our the morning, questions. I'm to and will with Financial topics strategy everyone. Thank joined our briefly operator, X we by and after in last Officer. months good made capital and performance, will Kim today's open in discuss which significant financial

fashion. Stereotaxis' near-term clinical invest longer-term in was Stock reintroduce financial and our commentary our reiterated New to effort drivers $XX Stereotaxis in and high-technology, awareness publicly quarter our will to These strength On value. operating traded and in strong the prudently forward with A growth uplisting Exchange thoughtful markets the equity September X to the how highlight and They I and deploying York provided financial to confidence increased financing announced and community additional reflect were our companies. our last a on us of allow Stereotaxis also I position growth reengage million our opportunity. activities accelerate into call, August. value of in methodical, the the in steps of commitment significant third capital to in

promised. a we the needing American able our I'm skepticism that to uplist ability as a fielded without have I reverse For were several quarters, and questions exchange execute split pleased on to split. without reverse stock to onto NYSE uplist investor

reengaging company. reflective aspects fashion the philosophy in approach natural a driving Our progress of all of and capital is the a markets with broader to methodical for

with strategy. combined wave proprietary will robotics launch growth next-generation fluoroscope, first commercial our of our The serve tightly as Genesis system, commercial broad significant our the integrated in

advance X primary areas fronts We regulatory broad supply customers. with effort: to are multiple engagement the commercialization. methodically process, towards and continue on chain here we significant optimization investing where There are

in making on are are working tandem tangible and progress X each. rapidly all on We

On the constructive in significant second and last for system recently the cleared application and appreciate We the application for efficient is pursuing such the for that regulatory FDA's a I FDA received Europe, I professional for and two want XXX(k) to the FDA. advancing process acknowledge side, submission undertakings. we on XXX(k) Genesis These commercialization stage call the September were engagement, our We commented a with submitted in first fashion. submissions in the and team were Genesis system. Stereotaxis clearance

components over system a X,XXX the chain incorporates From perspective, Genesis over supply suppliers. XXX from

through process pleased fashion. all I'm done suppliers for working sufficient been the capacity timely inventory still have be and a progress. the quantities of building key here, deliver our components have in commercial systems of to with but We ensuring work There's that to

that submission. process in have robotic with for activity I'm is local with construction the hospital existing plan customers lengthy there by submitted coordination so customers replacement requiring public extensive Europe, system pleased place are at layer contractors. been of our of aware robotic new In of are customers a we a schedules contracts building public of Commercially, potential layers on strategy and on U.S., multiple have a they tender with the of that labs. Europe. robotic The ensuring systems hospital we the and Europe, the In engaging that are added innovation projects approval, a can now taking multiple hospitals. often purchase in hospital There begun tenders with EP accordingly. is

with for discussions confident you is the coming advanced that cycle with meaningful, customers. clarity we real robotic in opportunity provide be other that in months, replacement able Genesis additional innovations are the hospitals. new by to and will I'm We our adoption support that

Genesis ablation is of significant growth. wave strategy. second lines. Stereotaxis' the first driver commercial system of more provided as accordance as to our serves serves proprietary in with next-generation go continues catheter in with time collaboration growth substantial even well the Launch in Development previously the revenue magnetic and Osypka advancing

design catheter catheter refined require additional working that and strategic successfully care improve will currently and they meaningfully physician improve are also such do next-generation prototypes, The aspects with catheter of iterative are iteration. design experience. through improvements many We having to in meant of patient the Stereotaxis' positioning. this the not proprietary been considerations A financial

that believe select and geographies to in XXXX. is in launch possible use clinical continue We commercial

able accurately; precision, needs A physician Acutus, procedure. are to preoperative physicians pleased a intraoperative more a diagnose analysis and patient cardiac therapy an innovative the the technologies capturing and the technologies. limited. mapping X Stereotaxis' from and final development We Companies want used the The to mapping during primary with, treat second technology of underlying on cardiac for advanced anatomical prevalence involve like suffering procedures various on physicians of Intraoperative order is mapping. ADAS and preoperative of and successful partnered deliver or and arrhythmias reliance clinical technologies: topic arrhythmia, elaborate mapping are successful supports technologies, and one-size-fits-all successfully. the ablation that crude, in I'm is task: second, where intraoperative are determine The Despite pioneering a of on include about be approaches. electrical we still industry, electrograms into understanding collaborations to the therapy. information the anatomical to heart the In critical mapping of cardiac therapy announced which XD arrhythmias critical ablation be and to by methods patient's multibillion-dollar recently then, delivery robotic VIVO. to integrations arrhythmias to, with safety first, stability excited inHEART, successful of deliver

VIVO, images mapping procedure that images of to safety ADAS to a extract in XD, their technologies. These drive increasingly preoperative to apply advanced in Preoperative intraoperative preoperative collaborations preoperative the mapping, integrate additive the help technology The captured guide way, and combination take each imaging or or advanced Enhancement in robotics, use prior patient-specific insights still therapy own from and therapy. information types of is electrophysiology. likely patients. and ablation and cardiac with by will Collectively, enhance enhance to for preoperative mapping contrast, complements mapping for MRI advanced involves insights success, using and inHEART of increase arrhythmias from its CT provided mapping insights the technologies is and to to is differ sophisticated In images. CT algorithms robotic MRI in the different ecosystem. each and best efficiency and procedures. be use suited personalized preoperative should of infancy

the will Kim then financial opening will commentary now a comments results, financial provide before I make to some few and on Q&A. call our

Kimberly Peery

hospital contracts. Niobe accounts and everyone. a Thanks, good due partially primarily system from to year X% the no for David, in the reported as reduced third quarter $X.X increase of aged, and was third quarter. the totaled the morning, revenue prior $X.X by This delivery was million Revenue active longer offset inactive million, to of customer service a XXXX new maintain certain increase service a U.S.

provided increased were XX%. on quarter Gross XXXX. of expenses million of the and breakeven, with the the count recurring quarter, quarter of million Operating free increase margin XX% in of year. and net operating of expenses near the of in XXXX. loss in reflects system third income project-based compare flow margins $XX,XXX. in head guidance revenue year. and for an $X operating expenses. was In prior cash in our increased revenue, was net in gross the both and revenue were each Negative timing XX% $XX,XXX the the loss cash of operating for and quarter to from net of ahead consistent third and loss $X.X utilization consistent Operating current the $X.X The with quarter with an million, for million and quarter These $X.X income previously

no profitability This cash of balance At and additional growth we allows to cash million in without increased equivalents strong sheet for and initiatives the ability debt. September had reach investment financings. XX, $XX.X and

to the back will David. now hand I call

David Fischel

Thank you, Kim.

we execute a solid aspect fashion financially our methodical while prudent. in remaining each delighted on business We that of to are able been have

this As XXXX has and towards reflect can sales we the in effect broad system impact any disproportionate and bottom a profitability. new robot look top both quarter sale the positive individual the that Stereotaxis. results on the line, commercialization On Genesis, impact of the and for growth financial of have

revenue growth activity in impact to as recurring remain support year. term been from value, sales but will has that on resurgence the focused and important the that robust drive accelerating We system longer we expect the commercial determining a next revenue

look open Operator, forward can fielding to now you line? questions. please We your the

Operator

our have is first do and coming Cowen. from we And question, Josh that Instructions]. Jennings [Operator at

Joshua Jennings

approval the progress you you table. the steps? can other progress including think exciting. just It's are to first the just continued just could with us David, specifics just -- help FDA preoperative ask Could Any what's put what I in the on FDA of process? in left just additional and provide collaborations the imaging that on made the through Congratulations with you you undoubtedly the maybe platforms. terms

David Fischel

Sure.

that to which changes stage recently, described a and years included for submission And much also answers, This XX-day XXX(k) had submission, the we on and submission indications made collaboratively it clock, the was broad that had pleased submission, September. changes taken fairly the over I Genesis that and/or which the system, the language. a received and substantial as questions. two of and of for have simpler questions with now software had and a those is in first It last broad was approach submission. we XXX(k). a in We call, worked was FDA So improvements FDA submission of we're range many was relatively has the to our that a the some a in kind place

is -- two-pronged stage. we the expectation from we simplify yet strategy but not second to obviously, So significantly FDA, the our received supposed was that have that, feedback

Joshua Jennings

of funnel announcement the Excellent. into funnel, mean And are XXXX. what approval get still is replacement us to in early the you the the full just was of very know how replacement to days evolving Genesis But then how And I made demand I States, it's launch into HRS. with launch the in similarly the States? is understand approval, maybe just approval funnel FDA over help And deeper discuss up? up you more and how post-CE at Mark is funnel front And could able Europe, shaping Europe? shaping CE and Mark clearly, customers? replacement United a United

David Fischel

Sure.

each cycle Europe, you X a replacement on about hospitals we that about year. that means are basis, in And hospital X, normalized customers. have have undergoing So that XX active should a

those, to looking earnings change We coordination are of multiple labs, described a their are approval, in of are take part activities hospital. is place. take the local are and for X-ray, with actively existing that Europe. of including have to public that of have almost robotic contracts submission. call. looking with I customers some on to multiple there's schedules process I in that the a to upgrade to activities There us layers multiple place be -- engaging then are always types replacement of there mentioned And construction their system the that extensive tender seems And hospital

a take -- system submission so cannot have that, of together And there complete. kind actually that before a a even you of the that lot tender take is comes until sale system order. place Orders there's and is

through Europe. those robot a in had similarly, of in there replacement customers new now. right working Europe have And that So projects multiple with that potential we're we're never working are

-- system. the We able innovation our to innovation obviously cannot we're to our plan. they U.S., physicians What insight to able are system, which with robotic discuss with Genesis. us we're a commercialize is to we're not purchasing not historical obviously in do Niobe And able we And our commercialize do provide into Genesis. pipeline, able is

sites a by excited shared there to FDA anticipation bit and are labs. with new with U.S. with planned replacement that of been us. similarly, in really terms updates engaging customers would again, sale. a we at think But so customers them the perhaps of a to engaging were of -- interested existing Many of that around to be until their the have time kind have obviously engage Genesis might potential have limited opportune some of and we our might kind push the system we're out we cycle otherwise I and HRS do in replace that more now, in approval And And of both that

Joshua Jennings

then and And any a system? that indications with ablation question. markets. of lot other know you thoughts could updated Stereotaxis last pursue just within cardiac Great. electrophysiology in I on But front just Genesis you the the have

David Fischel

catheter look much technology, have of Sure. Thanks. precision, device you interventional with That's I of navigate When you greater devices. is from to navigate precision handle greater course, until safer much a And great translation, the tip, tortuous be of stability, devices the from relying value more the you you ability than gentle navigate a from rather very a the you much you tip question, the directly at can interventional -- can the design Josh. traditional devices to Stereotaxis' than tip. robotic have on the and much anatomies. When have

would make sense indications barrier safety either be We of to working kind device. interventional range the are is attacking stability, primary any the a or of endoluminal of those and valuable. would There endovascular -- that other reach where precision, or applications broad

So system the itself. it's system be magnetic that device. The designed and applied interventional since of robotic is so anatomies less the providing could Genesis it's in largely fields various capable

enabling of those major financing was step think forward in applications. seriously completed some obviously that The critically us additional in and was about to August a

of think discussing refined additional with those real kind so milestones we comfortable And details publicly, there. share become some I feel we'll that are programs as of tangible concepts that and further

growing did calls, that kind the field. of intervention think applications be and I some Kind neural of obviously an -- section, one oncology mention was I also And a endoluminal as of is things a Q&A the interesting interventional interesting. little during bit, field. interesting there's like on I asked previous some could

Operator

[Operator Instructions].

come question Our next will from Judkowski Capital. Guy Logan with

Guy Judkowski

guess, on I a implementation that would sense it when do versus a the a -- we regarding announce end would they guess quarter? Or brand-new at And considered occur? each as an of the be material, out and schedules any deal, one, would sign of to of the like curious And is new -- time quarter, for is I'm would sort just for secondly, upgrade question looks deals sale, you just And My have seems of the it also, about -- find a versus I if you'll be deal then like you is sale It X frame? in of -- sale? that's X just that implementation? this to be difference typical made months. time what you it's terms anticipated upgrade the

David Fischel

Yes.

So -- it on really it depends actually factors. multiple

have process. you So purchasing the

all process, In terms of construction parallel involves that which the the second to from those unrelated question, the time kind kind line, you then the all some Europe. each are oftentimes have the contracts, other. And which one have extent X is track. in track tender of you purchasing approvals, of And that's a hospital the process process. of And

recognize a up we and And then lab completed is lab holding empty as tender the so And might soon as kind you where us. can perfectly suited be for a system the hospital and what's contract shell with if have on it other relatively revenue There rapidly. And can they're through months, that construction, and year not have that take working and a purchasing might times are their plus. contract where solid in a work signed. the even you then a still through is of process. signed, could tender an ship there's that situations that's already And construction is own that

you'd the willing of have to takes construction able the year and I signed take for think complete be been yet be the historically it delivery there's cases to system. where a for over kind still to and of and contracts, them

kind those that the we type equipment of with of -- only lines about time not take we're wide could our sort of dispersion Generally, and significant of in X kind be it place. company of orders tracks, there's kind capital that are going because orders, think payments backlogs kind down that will report of or So the that to in not things nonrefundable. take we're I

chance going anyways we're be so If by that order have be orders that becoming company then that of system reaped will Stereotaxis there has financial just an of not through. kind XX%-plus, type the should the order, sale. XX% if an to of it And in doesn't, process. And benefits a fall there be actual we

the determined of or to In not. orders of actually announce I we what admit -- to whether plan we have terms haven't should or not, that whether

I think over evolve time, order. from we're away definitely going announcing to every

of I Just expect a amount substantial that.

But a I they to that yet quarterly as than think basis determined come more report not it's plan. those in. on reasonable we've rather

Guy Judkowski

I guess versus an require construction on on would as specifically see. would general time? sale, be new upgrade new quicker good But implementation a -- upgrade and you you And much in do an answer. gave a anticipate, not I

David Fischel

that You not that are have are hospitals let's perfectly hospitals want of examples are generally have only shell more for has a looking us. might they do purchase procedural know correct. to designed people and are Though hospital lighter of do say, vacation on the And I that the yet summertime know I and replacement cycles, when labs contracts in volumes. to but do of examples replacement,

so driven of also ready And replacement. kind can things by available and outside whether space for be of it is just the the

Operator

Raul Our next CBTM Grande come question with from will [ph].

Unidentified Analyst

to have I more for [ph]. around in taken Grande than by $XX, have been of any Dr. comment be over is it? $XX Stereotaxis $XX? rumors range the ISRG on Do will between hearing $XX you that This

David Fischel

comment the on that would on biz be No, I side. dev to anything inappropriate apologize.

Unidentified Analyst

whatever very this have of and very and these have, given. happy the And they're you feel Stereotaxis, financial my all Congratulations with then system. you then surprised what the -- incredibly some -- reports, for friends

David Fischel

Thank you.

technology. our We are treat grateful physicians that the for patients with all

Operator

next Morganelli. coming our from question to move We'll John

John Morganelli

X comment, confidence brought to the tough and years, you've this long One is investor with just that say through product. a time I've just a been great want I to Stereotaxis things. I have David.

So with burn. both to crash brought And just this it good the product. great It's I straightforward want second, for didn't confidence since been been you've you've where been you've this And the that product. a involved. integrity and you has company thank integrity, to and

David Fischel

for and am I'm this to be and with very those comments, grateful technology clinical I with this honored to company value potential. and able a lead

to feel likewise Thank very very, John. grateful you, I So here. be

Operator

time, this further are no At questions. there

David Fischel

in hard your Thank to for your in questions and We for for growth support preparation continued of year your on you behalf the exciting interest and working months Thank in look coming for significant Okay. in XXXX. Stereotaxis. an comments forward and the you.

Operator

all participants you All attention. thank This And today's for conference. your concludes now may disconnect.

Stereotaxis (STXS) 14 Nov 192019 Q3 Earnings call transcript