Engaged in advancing innovative solutions for large-scale market applications
OMER, Israel, April 21, 2020 (GLOBE NEWSWIRE) — Medigus Ltd. (“Medigus” or the “Company”) (NASDAQ: MDGS) (TASE: MDGS), a medical device company developing minimally invasive endo-surgical tools and an innovator in direct visualization technology, today announced its financial results for the year ended December 31, 2019 and reported that the Company’s annual report on Form 20-F, containing audited consolidated financial statements for the year ended December 31, 2019 was filed with the Securities and Exchange Commission on April 21, 2020.
For the year ended December 31, 2019, the Company reported IFRS loss of $14,178,000 and non-IFRS loss of $3,963,000.
1. In June 3, 2019, the Company announced the signing of a $3,000,000 agreement with Golden Grand for the know-how licensing and sale of goods for Medigus Ultrasonic Surgical Endostapler (MUSE™) system in China, Hong Kong, Taiwan and Macao.
2. On June 19, 2019, the Company signed an agreement with Algomizer Ltd. and its wholly-owned subsidiary Linkury Ltd. for an investment of approximately $5 million in the Algomizer group. The investment was subject to certain pre-conditions, which were met at September 3, 2019.
3. On December 30, 2019 the Company consummated a securities exchange agreement with Intellisense Solutions Inc., a Nevada corporation (Intellisense), and as a result the Company assigned, transferred and delivered 100% of its holdings in ScoutCam to Intellisense, in exchange for (i) common stock representing 60% of Intellisense’s issued and outstanding share capital as of the closing, and (ii) in the event ScoutCam achieves $33,000,000 in aggregate sales within the first three (3) years immediately following the closing, the Company will receive additional shares of Intellisense’s common stock representing 10% of its outstanding share capital as of the closing. Simultaneous with the closing, Intellisense consummated a financing transaction in the aggregate amount of $3.3 million (gross) based on a company post-money valuation of $13.3 million.
4. On February 18, 2020, the Company purchased 2,284,865 shares of Matomy, representing 2.32% of its issued and outstanding share capital. On March 24, 2020 the Company completed an additional purchase of 22,326,246 shares of Matomy, raising the Company’s aggregated holding in Matomy to 24.99% of Matomy’s issued and outstanding share capital.
1. Revenues for the year ended December 31, 2019 were $273,000, a decrease of 37% compared to the year ended December 31, 2018.
2. Research and development expenses for the year ended December 31, 2019 were $609,000, a decrease of 66% compared to the year ended December 31, 2018. The decrease was primarily due to the decision of the Company to cease the MUSE™ operation.
3. Sales and marketing expenses for the year ended December 31, 2019 were $326,000, a decrease of 76% compared to the year ended December 31, 2018. The decrease was primarily due to the decision to abandon the strategy to commercialize the MUSE™ system.
4. General and administrative expenses for the year ended December 31, 2019 were $3,081,000, a decrease of 8% compared to the year ended December 31, 2018.
5. IFRS loss for the year ended December 31, 2019 was $14,178,000, compared to IFRS loss of $6,598,000 for the year ended December 31, 2018. The increase is attributed mainly to a listing expense, and partially offset by the decrease in research and development expenses, decrease in sales and marketing expenses and decrease in general and administrative expenses.
6. Non-IFRS loss for the year ended December 31, 2019 was $3,963,000, compared to Non-IFRS loss of $6,589,000 for the year ended December 31, 2018. The decrease is attributed mainly to the decrease in research and development expenses, decrease in sales and marketing expenses and decrease in general and administrative expenses.
7. Non-IFRS results exclude the effect of stock-based compensation expenses, revaluation of warrants at fair value and listing expenses.
Balance Sheet Highlights:
1. Cash and short-term deposits as of December 31, 2019 amounted to $7 million, compared to $10.6 million as of December 31, 2018.
2. The investment in Algomizer group as of December 31, 2019 amounted to $4.8 million.
3. IFRS equity as of December 31, 2019 amounted to $8.1 million, compared to $8.1 million as of December 31, 2018.
4. Non-IFRS equity as of December 31, 2019 amounted to $18.1 million, compared to $7.9 million as of December 31, 2018.
A reconciliation between IFRS equity results and non-IFRS equity results is provided bellow, following the financial statements presented as part of this release.
PR 2019 results new
Use of Non-IFRS Financial Results
In addition to disclosing financial results in accordance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board, this press release contains non-IFRS financial measures of net loss for the periods presented that exclude the effect of share-based compensation expenses, non-cash listing expenses and the revaluation of warrants at fair value. The Company’s management believes the non-IFRS financial information provided in this release is useful to investors’ understanding and assessment of the Company’s ongoing operations. Management also uses both IFRS and non-IFRS information in evaluating and operating its business internally, and as such, deemed it important to provide this information to the investors. The non-IFRS financial measures disclosed by the Company should not be considered in isolation, or as a substitute for, or superior to, financial measures calculated in accordance with IFRS, and the financial results calculated in accordance with IFRS and reconciliations to those financial statements should be carefully evaluated. Investors are encouraged to review the reconciliations of these non-IFRS measures to their most directly comparable IFRS financial measures provided in the financial statement tables herein.
The Company’s Annual Report on Form 20-F is available through the Securities and Exchange Commission’s website (www.sec.gov) as well as via the Medigus website (www.medigus.com). Shareholders may receive a hard copy of the annual report free of charge upon request to the Company.
Medigus Ltd. is a technology-based company engaged in advancing innovative solutions for large-scale market applications. To learn more about Medigus’ advanced technology, please visit www.medigus.com.