Earnings Release • Nov 15, 2023
Earnings Release
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For the month of November 2023
Commission File Number: 001-35165
BRAINSWAY LTD. (Translation of registrant's name into English)
19 Hartum Street Bynet Building, 3rd Floor Har HaHotzvim Jerusalem, 9777518, Israel
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F [ X ] Form 40-F [ ]
This Form 6-K is incorporated by reference into the Company's Registration Statement on Form S-8 filed with the Securities and Exchange Commission on April 22, 2019 (Registration No. 333- 230979) and the Company's Registration Statement on Form F-3 filed with the Securities and Exchange Commission on September 17, 2021 (Registration No. 333-259610). The Company's press release, filed as Exhibit 99.1 hereto, contains non-IFRS financial measures. Pursuant to guidance relating to the requirements of Regulation G, the Company has provided within the press release quantitative reconciliations of the non-IFRS financial measures to comparable IFRS financial measures. The non-IFRS financial measures are used in addition to and in conjunction with results presented in accordance with IFRS and should not be relied upon to the exclusion of IFRS financial measures.
| Exhibit Number | Description |
|---|---|
| 99.1 | BrainsWay Reports Third Quarter 2023 Financial Results and Operational Highlights |
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, thereunto duly authorized.
Date: November 15, 2023 /s/ Hadar Levy
Hadar Levy Chief Executive Officer
Generated Robust 61% Year-over-Year Revenue Growth in Q3 2023
BURLINGTON, Mass. and JERUSALEM, Nov. 15, 2023 (GLOBE NEWSWIRE) -- BrainsWay Ltd. (NASDAQ & TASE: BWAY) ("BrainsWay" or the "Company"), a world leader in advanced and non-invasive treatment for brain disorders, today reported third quarter 2023 financial results and provided an operational update.
"Our third quarter revenues of \$8.3 million represent an increase of 61% year-over-year, reflecting the strong and growing demand for our innovative Deep TMS technology," said Hadar Levy, BrainsWay's Chief Executive Officer. "Our increasingly robust sales pipeline continues to pay off, securing multi-system contracts with large networks in the U.S. as well as continued momentum internationally in various countries including Taiwan."
"Importantly, our third quarter operating results included nearing breakeven operating income, achieving positive Adjusted EBITDA ahead of schedule, and generating cash flow from operations exceeding \$1 million – all of which were driven by our revenue growth and the cost optimization measures we executed on earlier this year," continued Mr. Levy. "We are now targeting positive operating income and increased Adjusted EBITDA for the fourth quarter of 2023, while demonstrating full-year revenue growth over 2022."
BrainsWay's management will host a conference call today, Wednesday, November 15, 2023, at 8:30 a.m. Eastern Time to discuss these results and answer questions.
| United States: | 1-877-407-3982 |
|---|---|
| International: | 1-201-493-6780 |
| Israel: | 1-809-406-247 |
| Conference ID: | 13741239 |
| Webcast: | https://viavid.webcasts.com/starthere.jsp?ei=1634586&tp_key=97bf97c30c |
To listen to a live webcast, please visit the Investors section of the BrainsWay website at www.BrainsWay.com. Please access the Company's website at least 10 minutes ahead of the conference call to register. The webcast replay will be available on the website for two weeks following the completion of the call.
1See Adjusted EBITDA details and reconciliation table in the appendix below.
In addition to our results determined in accordance with International Financial Reporting Standards (IFRS), including, in particular operating income, and net income, we believe that Adjusted EBITDA, a non-IFRS measure, is useful in evaluating our operating performance. We define Adjusted EBITDA as net income adjusted for depreciation and amortization, finance income, finance expenses, income taxes, cost of share-based payments, and one-time restructuring and litigation expenses.
In addition to operating loss and net loss, we use Adjusted EBITDA as a measure of operational efficiency. We believe that this non-IFRS financial measure is useful to investors for period-to-period comparisons of our business and in understanding and evaluating our operating results for the following reasons:
Adjusted EBITDA, however, should not be considered as an alternative to operating loss or net loss for the period and may not be indicative of the historic operating results of the Company; nor is it meant to be predictive of potential future results. Adjusted EBITDA is not a measure of financial performance under IFRS and may not be comparable to other similarly titled measures for other companies. A reconciliation between the Company's net loss and Adjusted EBITDA is presented in the attached summary financial statements.
Because of these and other limitations, you should consider Adjusted EBITDA along with other IFRS-based financial performance measures, including net loss and our IFRS financial results.
BrainsWay is a global leader in advanced noninvasive neurostimulation treatments for mental health disorders. The Company is boldly advancing neuroscience with its proprietary Deep Transcranial Magnetic Stimulation (Deep TMS™) platform technology to improve health and transform lives. BrainsWay is the first and only TMS company to obtain three FDA-cleared indications backed by pivotal clinical studies demonstrating clinically proven efficacy. Current indications include major depressive disorder (including reduction of anxiety symptoms, commonly referred to as anxious depression), obsessive-compulsive disorder, and smoking addiction. The Company is dedicated to leading through superior science and building on its unparalleled body of clinical evidence. Additional clinical trials of Deep TMS in various psychiatric, neurological, and addiction disorders are underway. Founded in 2003, with offices in Burlington, MA and Jerusalem, Israel, BrainsWay is committed to increasing global awareness of and broad access to Deep TMS. For the latest news and information about BrainsWay, please visit www.brainsway.com.
This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words "intends," "may," "will," "plans," "expects," "anticipates," "projects," "predicts," "estimates," "aims," "believes," "hopes," "potential" or similar words. These forward-looking statements and their implications are based on the current expectations of the management of the Company only and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. In addition, historical results or conclusions from scientific research and clinical studies do not guarantee that future results would suggest similar conclusions or that historical results referred to herein would be interpreted similarly in light of additional research or otherwise. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: inadequacy of financial resources to meet future capital requirements; changes in technology and market requirements; delays or obstacles in launching and/or successfully completing planned studies and clinical trials; failure to obtain approvals by regulatory agencies on the Company's anticipated timeframe, or at all; inability to retain or attract key employees whose knowledge is essential to the development of Deep TMS products; unforeseen difficulties with Deep TMS products and processes, and/or inability to develop necessary enhancements; unexpected costs related to Deep TMS products; failure to obtain and maintain adequate protection of the Company's intellectual property, including intellectual property licensed to the Company; the potential for product liability; changes in legislation and applicable rules and regulations; unfavorable market perception and acceptance of Deep TMS technology; inadequate or delays in reimbursement from third-party payers, including insurance companies and Medicare; inability to commercialize Deep TMS, including internationally, by the Company or through third-party distributors; product development by competitors; inability to timely develop and introduce new technologies, products and applications, which could cause the actual results or performance of the Company to differ materially from those contemplated in such forward-looking statements.
Any forward-looking statement in this press release speaks only as of the date of this press release. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable securities laws. More detailed information about the risks and uncertainties affecting the Company is contained under the heading "Risk Factors" in the Company's filings with the U.S. Securities and Exchange Commission.
BrainsWay: Ido Marom Chief Financial Officer 844-386-7001 ext. 5 [email protected]
Investors: Brian Ritchie LifeSci Advisors 212-915-2578 [email protected]
September 30, 2023 December 31, 2022 Current Assets ASSETS (Unaudited) (Audited) Cash and cash equivalents \$ 43,893 \$ 47,581 Short-term deposits 271 271 Trade receivables, net 3,418 4,844 Inventory 3,504 3,837 Other current assets 1,460 1,556 52,546 58,089 Non-Current Assets System components 1,678 1,220 Leased systems, net 3,243 3,118 Other property and equipment 912 1,008 Other long-term assets 1,395 1,042 7,228 6,388 \$ 59,774 \$ 64,477 Current Liabilities LIABILITIES AND EQUITY Trade payables \$ 493 \$ 1,116 Deferred revenues 1,693 1,477 Liability in respect of research and development grants 1,320 1,057 Derivative liabilities 106 - Other accounts payable 4,651 4,491 8,263 8,141 Non-Current Liabilities Deferred revenues and other liabilities 4,923 4,923 Liability in respect of research and development grants 5,370 6,016 10,293 10,939 Equity Share capital 365 364 Share premium 140,951 138,146 Share-based payment reserve 3,519 6,180 Currency Translation Adjustments (2,188) (2,188) Accumulated deficit (101,429) (97,105) 41,218 45,397 \$ 59,774 \$ 64,477
| For the three months ended September 30, |
For the nine months ended September 30, |
||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | ||||||
| (Unaudited) | (Unaudited) | ||||||||
| Revenues | \$ | 8,302 | \$ | 5,168 | \$ | 22,756 | \$ | 21,144 | |
| Cost of revenues | 2,131 | 1,341 | 6,018 | 5,400 | |||||
| Gross profit | 6,171 | 3,827 | 16,738 | 15,744 | |||||
| Research and development expenses, net | 1,544 | 2,220 | 5,231 | 5,527 | |||||
| Selling and marketing expenses | 3,602 | 4,751 | 12,497 | 13,449 | |||||
| General and administrative expenses | 1,158 | 1,726 | 4,153 | 5,128 | |||||
| Total operating expenses | 6,304 | 8,697 | 21,881 | 24,104 | |||||
| Operating loss | (133) | (4,870) | (5,143) | (8,360) | |||||
| Finance income (expense), net | (38) | (99) | 1,234 | (752) | |||||
| Loss before income taxes | (171) | (4,969) | (3,909) | (9,112) | |||||
| Taxes on income | 59 | 70 | 415 | 370 | |||||
| Net loss and total comprehensive loss | \$ | (230) | \$ | (5,039) | \$ | (4,324) | \$ | (9,482) | |
| Basic and diluted net loss per share | \$ | (0.01) | \$ | (0.15) | \$ | (0.13) | \$ | (0.29) |
| For the three months ended September 30, |
For the nine months ended September 30, |
|||||||
|---|---|---|---|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |||||
| (Unaudited) | (Unaudited) | |||||||
| Cash flows from operating activities: | ||||||||
| Total comprehensive loss | \$ | (230) | \$ | (5,039) | \$ | (4,324) | \$ | (9,482) |
| Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
| Adjustments to profit or loss items: | ||||||||
| Depreciation and amortization | 85 | 160 | 279 | 457 | ||||
| Depreciation of leased systems | 247 | 244 | 719 | 735 | ||||
| Impairments and disposals | 481 | 183 | 938 | 416 | ||||
| Finance (income) expenses, net | 38 | 99 | (1,234) | 752 | ||||
| Cost of share based payment | 95 | 339 | 147 | 1,121 | ||||
| Income taxes | 59 | 70 | 415 | 370 | ||||
| Total adjustments to reconcile loss | 1,005 | 1,095 | 1,264 | 3,851 | ||||
| Changes in asset and liability items: | ||||||||
| Decrease (increase) in trade receivables | (31) | 1,770 | 1,404 | 635 | ||||
| Increase in inventory | (373) | (846) | (6) | (2,952) | ||||
| Decrease (increase) in other accounts receivable | 369 | (340) | (243) | (658) | ||||
| Increase (decrease) in trade payables | (58) | (392) | (639) | 169 | ||||
| Increase (decrease) in other accounts payable | 382 | 461 | (356) | (433) | ||||
| Increase (decrease) in deferred revenues and other | ||||||||
| liabilities | (173) | 835 | 238 | 1,103 | ||||
| Total changes in asset and liability | 116 | 1,488 | 398 | (2,136) | ||||
| Cash paid and received during the period for: | ||||||||
| Interest paid | (81) | (10) | (103) | (34) | ||||
| Interest received | 546 | 313 | 1,586 | 620 | ||||
| Income taxes paid | - | (70) | (11) | (336) | ||||
| Total cash paid and received during the period | 465 | 233 | 1,472 | 250 | ||||
| Net cash provided by (used in) operating activities: | 1,356 | (2,223) | (1,190) | (7,517) | ||||
| Cash flows from investing activities: Proceeds from (purchase of) property and equipment and |
||||||||
| system components, net | (514) | 108 | (1,945) | 1,508 | ||||
| Withdrawal of (investment in) short-term deposits, net | - | - | - | 40,254 | ||||
| Investment in long-term deposits, net | 8 | (15) | (8) | (20) | ||||
| Net cash provided by (used in) investing activities | (506) | 93 | (1,953) | 41,742 | ||||
| Cash flows from financing activities: | ||||||||
| Repayment of liability in respect of research and | ||||||||
| development grants | - | (479) | (345) | (977) | ||||
| Receipt of government grants | - | 9 | 32 | 15 | ||||
| Repayment of lease liability | (56) | (162) | (186) | (460) | ||||
| Issuance of share capital, net | - | (53) | - | (52) | ||||
| Net cash used in financing activities | (56) | (685) | (499) | (1,474) | ||||
| Exchange rate differences on cash and cash equivalents | (69) | (7) | (46) | (320) | ||||
| Increase (decrease) in cash and cash equivalents | 725 | (2,822) | (3,688) | 32,431 | ||||
| Cash and cash equivalents at the beginning of the period | 43,168 | 52,174 | 47,581 | 16,921 | ||||
| Cash and cash equivalents at the end of the period | \$ | 43,893 | \$ | 49,352 | \$ | 43,893 | \$ | 49,352 |
| (a) Significant non cash transactions: | ||||||||
| Recognition of new lease liability and right-of-use | - | 117 | 207 | 240 | ||||
| Termination of lease liability and right-of-use | - | - | 70 | - |
| For the three months ended September 30, |
For the nine months ended September 30, |
|||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 2023 | 2022 | 2023 | 2022 | |||||||
| (Unaudited) | (Unaudited) | |||||||||
| Net loss and total comprehensive loss | \$ | (230) | \$ | (5,039) | \$ | (4,324) | \$ | (9,482) | ||
| Finance (income) expense, net | 38 | 99 | (1,234) | 752 | ||||||
| Income taxes | 59 | 70 | 415 | 370 | ||||||
| Depreciation and amortization | 85 | 160 | 279 | 457 | ||||||
| Depreciation of leased systems | 247 | 244 | 719 | 735 | ||||||
| Cost of share based payment | 95 | 339 | 147 | 1,121 | ||||||
| Restructuring and litigation Cost | 50 | - | 852 | - | ||||||
| Adjusted EBITDA | \$ | 344 | \$ | (4,127) | \$ | (3,146) | \$ | (6,047) |
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