Welcome!

News Feed Item

LabStyle Innovations Reports 2014 Second Quarter Results and Anticipated Milestones for the Remainder of the Year

Encouraging results of the initial Dario™ smart meter soft launch

CAESAREA, Israel, Aug. 15, 2014 /PRNewswire/ -- LabStyle Innovations Corp. (OTCQB: DRIO), developer of the Dario™ Diabetes Management Solution, today reported its financial and operational results for the three and six months period ending June 30, 2014. The company also presented an overview of results of the Dario™ smart meter soft launch, recent corporate achievements and anticipated milestones for the remainder of 2014.

The initial launch of the Dario™ smart meter which has been underway since late March 2014 has  met with promising market demand demonstrated in the initial soft launch territories; the United Kingdom, Italy, and New Zealand.

The initial launch feedback includes the following:

  • Dario™ has been well received with excellent feedback from users. This has resulted in over 20,000 thousand of Dario app downloads in the six month period only in the soft launch territories, and a higher than average pick up rate thus indicating the feasibility to convert downloads to users in an efficient and productive manner.
  • Built a strong supportive community of people with diabetes using Dario™ for their diabetes management needs, primarily in the United Kingdom.
  • Surpassed the accepted industry average pickup rate for new users. The current pick up rate of over 68% of these users is due to their very positive experience with Dario™.
  • Number of Dario™ smart meter users has passed 2,000 and is growing. Reimbursement codes took longer than expected to be obtained and therefore, the number of users has been constrained and below expectations.  Now that reimbursement codes have been secured the user growth rate is expected to accelerate.

During the first half and the early third quarter of 2014, LabStyle believes that its roll out execution is on target as he following milestones were achieved:

  • Commenced first shipments of the Dario™ Diabetes Management Solution to distributors in Italy, New Zealand, the United Kingdom and the Netherlands, collecting initial positive feedback from the market of people with diabetes.
  • Received reimbursement status in England, Wales, Scotland and Northern Ireland for strips and lancets to be utilized together with the Dario™ smart meter (effective September 1, 2014). 
  • Received national and regional insurance reimbursement approval for the Dario™ Personalized Smart Meter in Italy. LabStyle is actively seeking reimbursement in other strategic territories.
  • Received approval from Israel's Ministry of Health to sell the Dario™ smart meter for diabetes in Israel.
  • Released the Dario™ Diabetes Management App for Android smartphone users.  The mobile application has the same user interface and features as the iOS Dario™ Application and is currently available for download in select soft launch markets. The Android supported Dario smart meter will be released in early September.
  • Received a Notice of Allowance from the U.S. Patent and Trademark Office for core patent claims covering the Dario™ personalized smart meter, which works in tandem with the novel and powerful Dario™ software application to form the overall Dario™ Diabetes Management Solution.
  • Working with FDA towards potential clearance of the Dario™ smart meter in the U.S. following a 510K filing made in late December 2013.
  • Partnered with FatSecret, a leading global nutrition data source, to integrate such data into the Dario™ Diabetes Management Solution.
  • Raised $3.8 million in net proceeds from private placement which had its closing on February 2014.
  • LabStyle's business strategy and goals assuming adequate funding for the remainder of 2014 and into 2015 include: Expedite production of Dario™ personalized smart meters for both Android and iOS smartphone operating systems, in selected jurisdictions with maximum optimization and efficiency.
  • Continue to enhance logistics and shipment process in order to ship and deliver Dario™ personalized smart meters and test strips in a timely and productive manner.
  • Expand distributor network with purchase commitments from strategic markets.
  • Increase awareness of Dario™ and sales penetration in key target markets. 
  • Facilitate reimbursement in key target markets.
  • Continue to refine and enrich the cutting edge software component of the Dario™ Diabetes Management Solution.
  • Obtain 510K FDA clearance for the Dario™ personalized smart meter by early 2015.  
  • Establish an online sales strategy.
  • Utilize the information collected from customer feedback and strategic agile marketing techniques in the long-term roll-out strategy.
  • Augment LabStyle's intellectual property portfolio with additional potential patent approvals in the U.S. and globally.

"It was a very exciting quarter for LabStyle", stated Erez Raphael, president and chief executive officer of LabStyle. "We closed the quarter with first shipments of Dario™ to distributors in Italy, New Zealand and the United Kingdom. We are delighted with the initial market demand that has been demonstrated in the UK and New Zealand where we have marketed the Dario™ smart meter. Although Italy has lagged behind, we have been working very hard to increase market penetration in all the territories and to ensure customer supply and satisfaction. The soft launch has demonstrated product demand and the efficacy of our agile marketing techniques. Compared to the fourth quarter of 2013, our marketing and pre-production expenses have increased, as we prepared for the soft launch that began in March 2014, and we have reduced our research and development expenses and general and administrative spending during this quarter in order to preserve our resources for the ongoing commercialization efforts. The company will require additional funding and will continue to manage its capital resources by reducing the manufacturing costs and research and development expenses as we deal with market demand for the Dario™ smart meter."

Summary of Financial Results

As evidenced by a reduction in expenses as detailed below, LabStyle's management is working to focus the company's resources on activities aimed at driving stockholder value.

LabStyle commenced its initial "soft" commercial launch of the Dario™ Smart Meter in late March 2014 with first shipments occurring during April 2014. However, no revenues could be recognized for the second quarter of 2014 since not all revenue recognition criteria according to US-GAAP were met.

As of June 30, 2014, LabStyle had approximately $1,819,000 in cash on hand. The company forecasts such funds will be sufficient to continue its activities into October 2014, and additional funding will be required to meet the company's anticipated milestones.

Ramp up of manufacturing costs for the second quarter of 2014 were approximately $605,000 compared with none for the second quarter of 2013, and for the first half of 2014 were approximately $1,026,000 compared with none for the first half of 2013. The increase was due to the commencement of our initial commercial sales during March 2014 with first shipments occurring during April 2014.

Research and development expenses for the second quarter of 2014 were approximately $1,333,000 compared with approximately $1,416,000 for the second quarter of 2013, and for the first half of 2014 were approximately $2,440,000 compared with $2,091,000 for the first half of 2013. The increase was largely due to recruitment of new employees and progress in product development which resulted in our initial "soft" commercial launch.

Marketing and pre-production expenses were approximately $373,000 for the second quarter of 2014 compared with approximately $664,000 for the second quarter of 2013 and approximately $659,000 in the first half of 2014 compared with approximately $1,161,000 for the first half of 2013. This decrease was largely due to pre-production costs which, during 2013, were allocated to marketing and pre-production costs and in 2014, since we commenced the initial commercial sales of our product, we allocated production costs to ramp up of manufacturing costs. 

General and administrative expenses for the second quarter of 2014 were approximately $1,292,000 compared to approximately $1,516,000 for the second quarter of 2013 and approximately $2,146,000 for the first half of 2014 compared with approximately $3,420,000 for the first half of 2013. The decrease from 2013 was mainly due to non-cash stock based compensation and non-cash expenses related to the issuance of common stock and warrants granted to service provider during the first half of 2014 in the amount of approximately $1,199,000 and $0, respectively, compared to non-cash stock-based compensation expenses for the first half of 2013 of approximately $1,358,000 and $1,011,000, respectively.

Financing expenses for the second quarter of 2014 were mainly driven by gain of approximately $396,000 non-cash charge related to the revaluation of warrants, compared with a loss related to the revaluation of warrants of approximately $1,664,000 in the second quarter of 2013. Financing expenses for the first half of 2014 were mainly driven by a gain of approximately $538,000 non-cash charge related to the revaluation of warrants offset by a loss of approximately $489,000 from non-cash issuance costs related to warrants in the first half of 2014, compared with a loss related to the revaluation of warrants of approximately $3,800,000

The net loss for the second quarter of 2014 was approximately $3,254,000, or $0.14 per share, compared with a net loss of approximately $5,286,000, or $0.29 per share, for the second quarter of 2013. For the first six months of 2014 the net loss was approximately $6,238,000, or $0.28 per share, compared with a net loss of approximately $10,513,000, or $0.63 per share, for the first six months of 2013.

The non-GAAP adjusted loss for the second quarter of 2014 was approximately $2,753,000, or $0.11 per share, compared with a non-GAAP adjusted loss for the second quarter of 2013 of approximately $2,251,000, or $0.12 per share. The non-GAAP adjusted loss for the first half of 2014 was approximately $4,714,000, or $0.21 per share, versus a non-GAAP adjusted loss of approximately $3,497,000, or $0.21 per share, in the corresponding period in 2013.

LabStyle used approximately $4,418,000 in cash to fund operating activities during the first half of 2014. As of June 30, 2014, LabStyle had cash, cash equivalents, restricted cash and short-term bank deposits of approximately $1,985,000.

Note on Non-GAAP Measures

Readers should note that LabStyle has, in the schedule below, supplemented its GAAP net income (loss) with a non-GAAP measure of adjusted EBITDA.  Management believes that this non-GAAP financial measure provides useful supplemental information to management and investors regarding LabStyle's performance, facilitates a more meaningful comparison of results for current periods with previous operating results, and assists management in analyzing future trends, making strategic and business decisions and establishing internal budgets and forecasts. A reconciliation of non-GAAP adjusted EBITDA to GAAP net income (loss) in the most directly comparable GAAP measure is provided in the schedule below.

There are limitations in using this non-GAAP financial measure because it is not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. This non-GAAP financial measure should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP and the reconciliations of the non-GAAP financial measure provided in the schedule below:


Unaudited

US Dollars in thousands except stock and stock data


Three months ended June 30,


Six months ended June 30,



2014


2013


2014


2013










Net income (loss) as reported


$        (3,254)


$      (5,286)


$      (6,238)


$       (10,513)

Adjustments:









Depreciation


160


196


358


314

Revaluation of warrants


(396)


1,664


(538)


3,800

Other finance expenses


47


26


505


41










EBITDA


$        (3,443)


$      (3,400)


$      (5,913)


$         (6,358)










Stock-based compensation


690


531


1,199


1,850

Expenses related to Issuance of common stock and warrants to service provider


-


618


-


1,011










Non-GAAP adjusted EBITDA


$        (2,753)


$      (2,251)


$      (4,714)


$         (3,497)

Weighted average number of common stock used in computing basic and diluted net loss per share


22,985,523


18,327,387


 

 

 

22,152,675


16,590,423

Non-GAAP adjusted EBITDA per stock


$        (0.11)


$       (0.12)


$       (0.21)


$       (0.21)



















About LabStyle Innovations

LabStyle Innovations Corp. (OTCQB:DRIO) develops and commercializes patent-pending technology providing consumers with laboratory-testing capabilities using smart mobile devices. LabStyle's flagship product is the Dario Diabetes Management Solution.  Dario received CE mark certification in September 2013 and began a world rollout in select countries in December 2013.  LabStyle filed a Premarket Notification Application, also known as a 510(k), with the US Food and Drug Administration (FDA) for the Dario™ smart meter (Dario Blood Glucose Monitoring System) in December 2013. LabStyle is pursuing patent applications in multiple areas covering the specific processes related to blood glucose level measurement as well as more general methods of rapid tests of body fluids using mobile devices and cloud-based services. For more information: www.mydario.com and http://mydario.investorroom.com.

Cautionary Note Regarding Forward-Looking Statements

This news release and the statements of representatives and partners of LabStyle Innovations Corp. (the "Company") related thereto contains or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "plan," "project," "potential," "seek," "may," "will," "expect," "believe," "anticipate," "intend," "could," "estimate" or "continue" are intended to identify forward-looking statements. Readers are cautioned that certain important factors may affect the Company's actual results and could cause such results to differ materially from any forward-looking statements that may be made in this news release. Factors that may affect the Company's results include, but are not limited to, regulatory approvals, product demand, market acceptance, impact of competitive products and prices, product development, commercialization or technological difficulties, the success or failure of negotiations and trade, legal, social and economic risks, and the risks associated with the adequacy of existing cash resources. Additional factors that could cause or contribute to differences between the Company's actual results and forward-looking statements include, but are not limited to, those risks discussed in the Company's filings with the U.S. Securities and Exchange Commission. Readers are cautioned that actual results (including, without limitation, the timing for and results of the Company's commercial and regulatory plans for Dario™ as described herein) may differ significantly from those set forth in the forward-looking statements. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. 

 

CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands








June 30,


December 31,



2014


2013



Unaudited








ASSETS










CURRENT ASSETS:





Cash and cash equivalents


$           1,819


$          2,263

Restricted cash


-


38

Short-term bank deposits


166


154

Other accounts receivable and prepaid expenses


355


475

Inventory


22


-






Total current assets


2,362


2,930






LEASE DEPOSIT


49


41






PROPERTY AND EQUIPMENT, NET


991


1,145






Total assets


$           3,402


$          4,116






 

CONSOLIDATED BALANCE SHEETS

U.S. dollars in thousands (except stock and stock data) 








June 30,


December 31,



2014


2013



Unaudited








LIABILITIES AND STOCKHOLDERS' DEFICIT










CURRENT LIABILITIES:





Trade payables


$             681


$             586

Other accounts payable and accrued expenses


1,095


920






Total current liabilities


1,776


1,506






LIABILITY RELATED TO WARRANTS


5,379


2,696











COMMITMENTS AND CONTINGENT LIABILITIES










STOCKHOLDERS' EQUITY DEFICIT:





Common Stock of $0.0001 par value -

Authorized: 80,000,000 (unaudited) and 45,000,000 shares at June 30, 2014 and December 31, 2013; Issued and Outstanding: 23,013,889 (unaudited) and 20,071,816 shares at June 30, 2014 and December 31, 2013, respectively


2


2

Preferred Stock of $0.0001 par value -

Authorized: 5,000,000 shares at June 30, 2014 and December 31, 2013; Issued: None at June 30, 2014 and December 31, 2013; Outstanding: None at June 30, 2014 and December 31, 2013


-


-

Additional paid-in capital


22,486


19,915

Accumulated deficit


(26,241)


(20,003)






Total stockholders' deficit


(3,753)


(86)






Total liabilities and stockholders' deficit


$           3,402


$       4,116








 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

U.S. dollars in thousands (except stock and stock data)



Three months ended June 30


Six months ended June 30



2014


2013


2014


2013



Unaudited


Unaudited










Revenues


$                       -


$                      -


$                       -


$                       -

Ramp up of manufacturing costs


605


-


1,026


-










Gross loss


605


-


1,026


-










Operating expenses:









Research and development


$              1,333


$           1,416


$              2,440


$              2,091

Marketing and pre-production costs


373


664


659


1,161

General and administrative


1,292


1,516


2,146


3,420










Total operating expenses


2,998


3,596


5,245


6,672










Operating loss


3,603


3,596


6,271


6,672










Financial expenses (income), net:









Revaluation of warrants


(396)


1,664


(538)


3,800

Other financial expense


47


26


505


41










Total financial expenses (income), net


(349)


1,690


(33)


3,841










Net loss


$              3,254


$           5,286


$              6,238


$            10,513










Net loss per share


















Basic loss per share


$             (0.14)


$           (0.29)


$             (0.28)


$             (0.63)

Weighted average number of common stock 
     used in computing basic net loss per share


22,985,523


18,327,387


22,152,675


16,590,423










Diluted loss per share


$             (0.15)


$           (0.29)


$             (0.29)


$             (0.63)

Weighted average number of common stock 
     used in computing diluted net loss per share


23,202,077


18,327,387


22,260,952


16,590,423

 

Contacts:


Press

Investor Relations



Brenda Zeitlin

LabStyle Innovations

Book and Company Inc.

1 212 490 9095

1 800 896 9062

[email protected]

[email protected]


SOURCE LabStyle Innovations Corp.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
For far too long technology teams have lived in siloes. Not only physical siloes, but cultural siloes pushed by competing objectives. This includes informational siloes where business users require one set of data and tech teams require different data. DevOps intends to bridge these gaps to make tech driven operations more aligned and efficient.
Organizations planning enterprise data center consolidation and modernization projects are faced with a challenging, costly reality. Requirements to deploy modern, cloud-native applications simultaneously with traditional client/server applications are almost impossible to achieve with hardware-centric enterprise infrastructure. Compute and network infrastructure are fast moving down a software-defined path, but storage has been a laggard. Until now.
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, discussed how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team at D...
DXWorldEXPO LLC announced today that the upcoming DXWorldEXPO | CloudEXPO New York event will feature 10 companies from Poland to participate at the "Poland Digital Transformation Pavilion" on November 12-13, 2018.
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service.
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
With 10 simultaneous tracks, keynotes, general sessions and targeted breakout classes, @CloudEXPO and DXWorldEXPO are two of the most important technology events of the year. Since its launch over eight years ago, @CloudEXPO and DXWorldEXPO have presented a rock star faculty as well as showcased hundreds of sponsors and exhibitors!
JETRO showcased Japan Digital Transformation Pavilion at SYS-CON's 21st International Cloud Expo® at the Santa Clara Convention Center in Santa Clara, CA. The Japan External Trade Organization (JETRO) is a non-profit organization that provides business support services to companies expanding to Japan. With the support of JETRO's dedicated staff, clients can incorporate their business; receive visa, immigration, and HR support; find dedicated office space; identify local government subsidies; get...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
All organizations that did not originate this moment have a pre-existing culture as well as legacy technology and processes that can be more or less amenable to DevOps implementation. That organizational culture is influenced by the personalities and management styles of Executive Management, the wider culture in which the organization is situated, and the personalities of key team members at all levels of the organization. This culture and entrenched interests usually throw a wrench in the work...
Without lifecycle traceability and visibility across the tool chain, stakeholders from Planning-to-Ops have limited insight and answers to who, what, when, why and how across the DevOps lifecycle. This impacts the ability to deliver high quality software at the needed velocity to drive positive business outcomes. In his general session at @DevOpsSummit at 19th Cloud Expo, Eric Robertson, General Manager at CollabNet, will discuss how customers are able to achieve a level of transparency that e...
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...