UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 3, 2017
ReWalk Robotics Ltd.
(Exact name of registrant as specified in its charter)
| Israel | 001-36612 | N/A |
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
|
3 Hatnufa St., Floor 6, Yokneam Ilit, Israel |
2069203 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: +972.4.959.0123
| Not applicable |
| (Former name or former address, if changed since last report) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x
TABLE OF CONTENTS
| ITEM 2.02 — RESULTS OF OPERATIONS AND FINANCIAL CONDITION | 3 |
| ITEM 9.01 — FINANCIAL STATEMENTS AND EXHIBITS | 3 |
| SIGNATURES | 4 |
| EXHIBIT INDEX | 5 |
2
Item 2.02 Results of Operations and Financial Condition.
On August 3, 2017, ReWalk Robotics Ltd. (the “Company”) issued a press release announcing its financial results for the second quarter ended June 30, 2017. A copy of the press release is being furnished herewith as Exhibit 99.1. As set forth in the press release, the Company will host a conference call to discuss its financial results for the second quarter ended June 30, 2017 on Thursday, August 3, 2017 at 8:30 AM EST. A listen-only live webcast of the call may be accessed through the Company’s website at www.rewalk.com under the “Investors” section or by dialing (844) 423-9889 in the United States, 18 09 45 78 77 in Israel or (716) 247-5804 outside the United States and Israel. The access code for the call is 47740857.
An archived recording of the call will be made available shortly after the completion of the call for two weeks at (855) 859-2056 in the United States or (404) 537-3406 outside of the United States. The access code for the replay is 47740857. The archived webcast will also be available through the Company’s website at www.rewalk.com under the “Investors” section for 30 days after the completion of the call.
The information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “1934 Act”), nor shall it be deemed “incorporated by reference” into any filing under the Securities Act of 1933, as amended, or the 1934 Act, except as may be expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
|
Exhibit Number |
Description | |
| 99.1 | Press release dated August 3, 2017 of ReWalk Robotics Ltd. announcing financial results for the second quarter ended June 30, 2017, furnished herewith. |
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ReWalk Robotics Ltd. | ||
| By: | /s/ Kevin Hershberger | |
| Name: Title: |
Kevin Hershberger Chief Financial Officer | |
Dated: August 3, 2017
4
EXHIBIT INDEX
|
Exhibit Number |
Description | |
| 99.1 | Press release dated August 3, 2017 of ReWalk Robotics Ltd. announcing financial results for the second quarter ended June 30, 2017, furnished herewith. |
5
Exhibit 99.1
For Immediate Release
ReWalk
Robotics Reports Second Quarter 2017 Financial Results
-- 146% YOY growth in Q2 revenue to $2 million and
record 1H revenue of $4.5 million –
-- 11 favorable commercial case-by-case insurance
coverage decisions --
-- 217 pending insurance claims in the U.S. and Germany
--
-- Unveiled Restore soft-exosuit for stroke patients
--
YOKNEAM ILIT, ISRAEL / MARLBOROUGH, MA, August 3, 2017 – ReWalk Robotics Ltd. (Nasdaq: RWLK) (“ReWalk”
or “the Company”) today announced its financial results for the three- and six-month periods ended June 30, 2017.
Highlights of and subsequent to the second quarter include:
| • | Total revenue for the second quarter of 2017 grew 146% year-over-year to $2 million, compared to $817,000 for the second quarter of 2016; |
| • | Placed 31 ReWalk units during the second quarter, of which 17 were placed in the U.S., 11 were in our direct markets in Europe, and three were in other markets; |
| • | Increased pending insurance claims to 217 in the U.S. and Germany, as of the end of the quarter; |
| • | Secured 11 favorable commercial insurance coverage decisions; |
| • | Announced a Florida court ruling that Blue Cross Blue Shield of Florida must provide coverage of a ReWalk exoskeleton system for a plan member; |
| • | Signed exclusive distribution agreement in France with Harmonie Medical Service (HMS), one of the largest medical device providers in the country; and |
| • | Unveiled the Restore lightweight soft-exosuit base design for clinical studies and commercialization of an initial indication designed for stroke patients. |
“This was another strong quarter for ReWalk as we advanced our key initiatives: securing insurance reimbursement coverage for the ReWalk personal device, expanding our global footprint and progressing our innovative ‘soft suit’ exoskeleton technology designed for individuals with stroke. We’ve submitted extensive data for review by a large commercial insurer in the U.S. and await a decision. We believe that a positive coverage decision would be an important catalyst for our business and the industry. It would also reflect the growing consensus among multiple courts and insurers who have determined, on a case by case basis, that our technology is not experimental and offers health benefits to its users,” stated Larry Jasinski, Chief Executive Officer.
“At the same time, we are excited to have introduced our Restore lightweight ‘soft suit’ design for stroke patients. We plan to begin clinical studies and pursue regulatory approvals so that we can commercialize the Restore in 2018, in order to broaden the reach of our technology to the millions of patients who can benefit from access to the device,” he added.
Second Quarter 2017 Financial Results
Total revenue was $2 million for the second quarter of 2017, an increase of 146% compared with $817,000 in the second quarter of 2016. 31 ReWalk units were placed during the second quarter, compared with 25 ReWalk systems placed in the prior year period, of which 17 were placed in the U.S., 11 in Europe, and three with distributors.
Gross margin improved to 37% during the second quarter of 2017 compared to 10% in the prior year period, primarily attributable to the increase in volume, conversion of rental units to purchases, and lower product costs.
Total operating expenses in the second quarter of 2017 were $6.1 million compared with $8.7 million in the second quarter of 2016. Operating expenses in the second quarter of 2017 reflect initiatives to reduce spending announced earlier in 2017. Second quarter 2016 expenses include a one-time R&D charge related to the licensing agreement with the Wyss Institute at Harvard University.
Net loss was $6.3 million for the second quarter of 2017 compared with a net loss of $9.1 million in the prior year quarter. Non-GAAP net loss for the second quarter was $4.9 million compared with a non-GAAP net loss of $8.0 million in the second quarter of 2016.*
*A reconciliation of net loss to non-GAAP net loss is included at the end of this press release.
Liquidity
As of June 30, 2017, ReWalk had $16.3 million in cash on its balance sheet.
Conference Call
ReWalk management will host its second quarter conference call as follows:
| Date | August 3, 2017 | |
| Time | 8:30 AM EDT | |
| Telephone | U.S: | (844) 423-9889 |
| International: | (716) 247-5804 | |
| Israel: | 18 09 45 78 77 | |
| Access code | 47740857 | |
| Webcast (live and archive) | www.rewalk.com under the “Investors” section. | |
A telephone replay will be available shortly after the completion of the call for two weeks at (855) 859-2056 (U.S.) or (404) 537-3406 (International). The passcode for the replay is 47740857.
About ReWalk
Robotics Ltd.
ReWalk Robotics Ltd. develops, manufactures and markets wearable robotic
exoskeletons for individuals with spinal cord injury. ReWalk’s
mission is to fundamentally change the quality of life for individuals with lower limb disability through the creation and development
of market leading robotic technologies. Founded in 2001, ReWalk has headquarters in the U.S., Israel and Germany. For more information
on the ReWalk systems, please visit www.rewalk.com.
ReWalk® is a registered trademark of ReWalk Robotics Ltd. in Israel.
Forward-Looking Statements
In addition to historical information, this press release contains forward-looking statements within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995, Section 27A of the U.S. Securities Act of 1933, and Section 21E of the U.S. Securities
Exchange Act of 1934. Such forward-looking statements may include projections regarding ReWalk’s future performance and,
in some cases, may be identified by words like “anticipate,” “assume,” “believe,” “continue,”
“could,” “estimate,” “expect,” “intend,” “may,” “plan,”
“potential,” “predict,” “project,” “future,” “will,” “should,”
“would,” “seek” and similar terms or phrases. The forward-looking statements contained in this press release
are based on management’s current expectations, which are subject to uncertainty, risks and changes in circumstances that
are difficult to predict and many of which are outside of ReWalk’s control. Important factors that could cause ReWalk’s
actual results to differ materially from those indicated in the forward-looking statements include, among others: ReWalk’s
expectations regarding future growth, including its ability to increase sales in its existing geographic markets, expand to new
markets and achieve its planned expense reductions; the conclusion of ReWalk’s management for the financial statements for
the second quarter of 2017 and for fiscal 2016, and the opinion of ReWalk’s auditors in their report on the Company’s
financial statements for fiscal 2016, that there are substantial doubts as to ReWalk’s ability to continue as a going concern;
ReWalk’s ability to maintain and grow its reputation and the market acceptance of its products; ReWalk’s ability to
achieve reimbursement from third-party payors for its products; ReWalk’s expectations as to its clinical research program
and clinical results; ReWalk’s expectations as to the results of, and the Food and Drug Administration’s potential
regulatory developments with respect to, ReWalk’s mandatory post-market 522 surveillance study; the outcome of ongoing shareholder
class action litigation relating to ReWalk’s initial public offering; ReWalk’s ability to repay its secured indebtedness;
ReWalk’s ability to improve its products and develop new products; ReWalk’s ability to maintain adequate protection
of its intellectual property and to avoid violation of the intellectual property rights of others; ReWalk’s ability to gain
and maintain regulatory approvals; ReWalk’s ability to secure capital from its equity and debt financings in light of limitations
under its Form S-3, the price range of its ordinary shares and conditions in the financial markets, and the risk that such financings
may dilute ReWalk’s shareholders or restrict its business; ReWalk’s ability to use effectively the proceeds of its
2016 follow-on offering; ReWalk’s ability to maintain relationships with existing customers and develop relationships with
new customers; the impact of the market price of ReWalk’s ordinary shares on the determination of whether ReWalk is a passive
foreign investment company; ReWalk’s compliance with medical device reporting regulations to report adverse events involving
its products and the potential impact of such adverse events on ReWalk’s ability to market and sell its products; and other
factors discussed under the heading “Risk Factors” in ReWalk’s Annual Report on Form 10-K for the year ended
December 31, 2016, as amended, filed with the U.S. Securities and Exchange Commission and other documents subsequently filed with
or furnished to the U.S. Securities and Exchange Commission. Any forward-looking statement made in this press release speaks only
as of the date hereof. Factors or events that could cause ReWalk’s actual results to differ from the statements contained
herein may emerge from time to time, and it is not possible for ReWalk to predict all of them. Except as required by law, ReWalk
undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments
or otherwise.
Non-GAAP Financial Measures
To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. Generally Accepted
Accounting Principles (GAAP), ReWalk believes that the use of non-GAAP net loss is helpful to its investors. This measure is not
prepared in accordance with GAAP.
For the three- and six-months ended June 30, 2017 and 2016, non-GAAP net loss is calculated as GAAP net loss excluding (i) non-cash share-based compensation expense, (ii) depreciation and (iii) non-cash financial expenses.
Because of varying available valuation methodologies, subjective assumptions, and the variety of equity instruments that can impact a company’s non-cash expenses, ReWalk believes that providing non-GAAP net loss that excludes non-cash share-based compensation expense, depreciation and non-cash financial (income) expenses allows for more meaningful comparisons between operating results from period to period. This non-GAAP financial measure is an important tool for financial and operational decision-making and for the Company’s evaluation of its operating results over different periods of time. Non-GAAP net loss is not a measure of the Company’s financial performance under U.S. GAAP, and should not be considered as an alternative to operating loss or net loss or any other performance measures derived in accordance with GAAP. Non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in ReWalk’s industry, as other companies in the industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures in general, because non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact on the Company’s reported financial results. Further, share-based compensation expense has been, and will continue to be for the foreseeable future, a significant recurring expense in the Company’s business and an important part of the compensation provided to its employees. ReWalk urges investors to review the below reconciliation of the Company’s non-GAAP net loss to net loss, the comparable GAAP financial measure, and not to rely on any single financial measure to evaluate the Company’s business.
Investor Contact:
Lisa M. Wilson
President
In-Site Communications, Inc.
T: 212-452-2793
E: lwilson@insitecony.com
Media Contact:
Jennifer Wlach
Senior Vice President
Mercury LLC
T: 202-261-4000
E: jwlach@mercuryllc.com
(tables follow)
ReWalk Robotics Ltd.
Condensed Consolidated Statements of Operations
In thousands except per share data
(unaudited)
| Three Months Ended | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Revenue | $ | 2,007 | $ | 817 | $ | 4,506 | $ | 2,878 | ||||||||
| Cost of revenues | 1,266 | 732 | 2,716 | 2,300 | ||||||||||||
| Gross profit | 741 | 85 | 1,790 | 578 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Research and development, net | 1,385 | 3,074 | 2,815 | 4,769 | ||||||||||||
| Sales and marketing | 2,873 | 3,504 | 6,006 | 6,803 | ||||||||||||
| General and administration | 1,850 | 2,095 | 3,991 | 4,009 | ||||||||||||
| Total operating expenses | 6,108 | 8,673 | 12,812 | 15,581 | ||||||||||||
| Operating loss | (5,367 | ) | (8,588 | ) | (11,022 | ) | (15,003 | ) | ||||||||
| Loss on extinguishment of debt | 313 | - | 313 | - | ||||||||||||
| Financial expenses, net | 633 | 517 | 1,364 | 1,006 | ||||||||||||
| Loss before income taxes | (6,313 | ) | (9,105 | ) | (12,699 | ) | (16,009 | ) | ||||||||
| Income taxes (tax benefit) | (4 | ) | 12 | 10 | 30 | |||||||||||
| Net loss | $ | (6,309 | ) | $ | (9,117 | ) | $ | (12,709 | ) | $ | (16,039 | ) | ||||
| Net loss per ordinary share, basic and diluted | $ | (0.37 | ) | $ | (0.74 | ) | $ | (0.75 | ) | $ | (1.30 | ) | ||||
| Weighted average shares outstanding, basic and diluted | 17,218,154 | 12,403,541 | 16,837,903 | 12,363,698 | ||||||||||||
| Reconciliation of GAAP to Non-GAAP net loss | ||||||||||||||||
| Net loss | $ | (6,309 | ) | $ | (9,117 | ) | $ | (12,709 | ) | $ | (16,039 | ) | ||||
| Non-cash share based compensation expense | 847 | 826 | 1,698 | 1,543 | ||||||||||||
| Depreciation | 177 | 164 | 357 | 327 | ||||||||||||
| Non-cash financial expenses | 346 | 166 | 379 | 322 | ||||||||||||
| Non-GAAP net loss | $ | (4,939 | ) | $ | (7,961 | ) | $ | (10,275 | ) | $ | (13,847 | ) | ||||
ReWalk Robotics Ltd.
Condensed Consolidated Balance Sheets
In thousands
| June 30, | December 31, | |||||||
| 2017 | 2016 | |||||||
| Assets | Unaudited | Audited | ||||||
| Current assets | ||||||||
| Cash & cash equivalents | $ | 16,255 | $ | 23,678 | ||||
| Trade receivable, net | 1,114 | 1,254 | ||||||
| Prepaid expenses and other current assets | 1,259 | 1,291 | ||||||
| Inventory | 3,415 | 3,264 | ||||||
| Total current assets | 22,043 | 29,487 | ||||||
| Other long-term assets | 1,210 | 1,018 | ||||||
| Property and equipment, net | 1,068 | 1,258 | ||||||
| Total assets | $ | 24,321 | $ | 31,763 | ||||
| Liabilities and equity | ||||||||
| Current liabilities | ||||||||
| Current maturities of long term loan | $ | 7,441 | $ | 7,495 | ||||
| Trade payables | 2,910 | 3,424 | ||||||
| Other current liabilities | 1,462 | 1,479 | ||||||
| Total current liabilities | 11,813 | 12,398 | ||||||
| Long term loan | 8,537 | 10,518 | ||||||
| Other long-term liabilities | 568 | 587 | ||||||
| Shareholders' equity | 3,403 | 8,260 | ||||||
| Total liabilities and equity | $ | 24,321 | $ | 31,763 | ||||
ReWalk Robotics Ltd.
Condensed Consolidated Statements of Cash Flows
In thousands
(unaudited)
| Six months ended | ||||||||
| June 30, | ||||||||
| 2017 | 2016 | |||||||
| Net cash used in operating activities | $ | (11,231 | ) | $ | (13,513 | ) | ||
| Net cash used in investing activities | (22 | ) | (395 | ) | ||||
| Net cash provided by financing activities | 3,830 | 11,725 | ||||||
| Decrease in cash and cash equivalents | (7,423 | ) | (2,183 | ) | ||||
| Cash and cash equivalents at beginning of period | 23,678 | 17,869 | ||||||
| Cash and cash equivalents at end of period | $ | 16,255 | $ | 15,686 | ||||
ReWalk Robotics Ltd.
Revenue and Units Placed by Region and Product
In thousands except units
(unaudited)
| Three Months Ended | Six months ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||
| Revenue: | ||||||||||||||||
| United States | $ | 1,342 | $ | 527 | $ | 3,441 | $ | 2,266 | ||||||||
| Europe | 665 | 244 | 1,065 | 504 | ||||||||||||
| Asia Pacific | - | 46 | - | 108 | ||||||||||||
| Total Revenue | $ | 2,007 | $ | 817 | $ | 4,506 | $ | 2,878 | ||||||||
| Units Placed: | ||||||||||||||||
| United States | 17 | 13 | 43 | 39 | ||||||||||||
| Europe | 14 | 10 | 25 | 15 | ||||||||||||
| Asia Pacific | - | 2 | - | 3 | ||||||||||||
| Total Units Placed | 31 | 25 | 68 | 57 | ||||||||||||
| Revenue: | ||||||||||||||||
| Personal units revenue | $ | 1,903 | $ | 708 | $ | 4,326 | $ | 2,679 | ||||||||
| Rehabilitation units revenue | 104 | 109 | 180 | 199 | ||||||||||||
| Total Revenue | $ | 2,007 | $ | 817 | $ | 4,506 | $ | 2,878 | ||||||||
| Units Placed: | ||||||||||||||||
| Personal units placed | 30 | 24 | 66 | 55 | ||||||||||||
| Rehabilitation units placed | 1 | 1 | 2 | 2 | ||||||||||||
| Total Units Placed | 31 | 25 | 68 | 57 | ||||||||||||