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SANUWAVE Health Reports Second Quarter 2022 Financial Results & Will Host Live Conference Call With Business Update

Eden Prairie, MN - (NewMediaWire) - August 15, 2022 - SANUWAVE Health, Inc. (OTCPK: SNWV), a leading provider of next-generation wound care products, reported financial results for their second quarter ending June 30, 2022, with the SEC on Friday, August 12, 2022. The Company will host a live conference call on Tuesday, August 16, 2022, at 12:30 (EDT) to provide a business update (Dial-in information below).

Quarter Highlights:

  • Over 50 systems placed to treat wounds  
    • 100% increase from the 25 systems placed in Q2 2021
  • Over 40,000 wound treatments administered 
    • Up from 31,000 treatments administered in Q2 2021
  • Successfully completed MDSAP audit
  • Company transitioned from Suwanee, GA to Eden Prairie, MN
  • Became current on SEC filings
  • Launched Cosmetic and Orthopedics verticals with initial sales in each

“Our key ENERGY FIRST products, dermaPACE® and UltraMIST®, continue to show strong acceptance and growth due to their robust clinical and financial profiles and increasingly attractive reimbursement, driven by a shift in payor focus to evidence-based medicine in wound care.  As our devices ship and our footprint widens, it has allowed the company to build a high degree of recurring usage revenue.  This effort has been hampered over the past year as the company has also spent significant time and effort on fixing our accounting implementation that did not go as planned.  Disruption from this process flow issue led to late filings, which led to our issues on the OTC and Pink Sheets. It also had a significant financial impact as it drew attention and resources away from growth.  That is in the past, and as we sit today, we are now timely and current in our SEC filings, and the excessive outside costs to fix the problem have abated, lowering our break-even point.  The company is now positioned to focus on profitable growth as we capture the opportunity in the wound care space,” stated Kevin Richardson, CEO.

Quarter Financial Results

Revenues for the quarter, starting April 1, 2022, and ending June 30, 2022, came in at $3.9 million, an increase of $1 million or 33% when compared to the $ 2.9 million for the same period in 2021.  The increased revenue was primarily driven by an increase in sales of the UltraMIST system. The company moved manufacturing from Georgia to Minnesota, which impacted the timing of international shipments resulting in a $100,000 reduction in international revenue year-over-year.

Gross margin increased to 72% from 64% as cost of revenue remained flat.  The improvements were driven due to product mix and more efficient customer service and shipping.   

Operating loss was $2 million compared to $4 million in the year prior.  The improvement is due to an increase in gross income and a reduction in sales, marketing, and R&D expenses.    

Conference Call 

SANUWAVE Health, Inc. will host a live conference call on Tuesday, August 16, 2022, at 12:30 (EDT) to discuss recent business activity, provide an update on SEC filings, and detail strategic initiatives. A visual presentation accompaniment will be made available Tuesday morning via SANUWAVE’s website (https://sanuwave.com/about-us/news/).

Telephone access to the call will be available by dialing the following numbers:

Toll-Free: 1-877-407-0784

International: 1-201-689-8560

A replay will be made available through August 30, 2022:

Toll-Free: 1-844-512-2921

International: 1-412-317-6671

Replay Passcode: 13732361

About SANUWAVE

SANUWAVE Health is focused on the research, development, and commercialization of its patented, non-invasive and biological response-activating medical systems for the repair and regeneration of skin, musculoskeletal tissue, and vascular structures.  

SANUWAVE’s ENERGY FIRST wound care portfolio consists of regenerative medicine products and product candidates help restore the body’s normal healing processes. SANUWAVE applies and researches its patented energy transfer technologies in wound healing, orthopedic/spine, aesthetic/cosmetic, and cardiac/endovascular conditions.

Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, such as statements relating to financial results and plans for future business development activities and are thus prospective. Forward-looking statements include all statements that are not statements of historical fact regarding intent, belief or current expectations of the Company, its directors or its officers. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company’s ability to control. Actual results may differ materially from those projected in the forward-looking statements. Among the key risks, assumptions and factors that may affect operating results, performance and financial condition are risks associated with the regulatory approval and marketing of the Company’s product candidates and products, unproven pre-clinical and clinical development activities, regulatory oversight, the Company’s ability to manage its capital resource issues, competition, and the other factors discussed in detail in the Company’s periodic filings with the Securities and Exchange Commission. The Company undertakes no obligation to update any forward-looking statement. 

MEDIA CONTACT: 

Sabrina Ruelle

Senior Director, Marketing & Program Management

Sabrina.Ruelle@Sanuwave.com

INVESTOR RELATIONS CONTACT:

Kevin Richardson II
Chief Executive Officer
Investor.relations@Sanuwave.com

 

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands
  3 Months Ended 6 Months Ended
Jun. 30, 2022 Jun. 30, 2021 Jun. 30, 2022 Jun. 30, 2021
Revenues:
Total Revenue  $ 3,882   $ 2,909   $ 7,077   $ 5,025 
Cost of Revenues 1,096 1,048 1,986 2,103
Gross Margin 2,786 1,861 5,091 2,922
Operating Expenses:
General and administrative 2,937 2,923 5,078 6,045
Selling and marketing 1,672 2,520 3,387 4,300
Research and development 171 272 337 626
Gain on sale of property and equipment, net -136 0 -690 0
Depreciation and amortization 210 192 386 391
Total Operating Expenses 4,854 5,907 8,498 11,362
Operating Loss -2,068 -4,046 -3,407 -8,440
Other Income (Expense):
Interest expense -2,826 -1,437 -5,903 -2,559
Interest expense, related party -56 -48 -112 -95
Change in fair value of derivative liabilities 7,861 -591 11,343 44
Loss on issuance of debt 0 -2,484 -3,434 -2,484
Loss on extinguishment of debt -211 0 -211 0
Gain / (loss) on foreign currency exchange 2 -3 2 4
Other Income (Expense), net 4,770 -4,563 1,685 -5,090
Net Loss before Income Taxes 2,702 -8,609 -1,722 -13,530
Provision for Income Taxes 0 6 0 22
Net Income (loss) 2,702 -8,615 -1,722 -13,552
Other Comprehensive Income (Loss)
Foreign currency translation adjustments 0 -3 0 -11
Total Comprehensive Income (Loss)  $ 2,702   $ (8,618)  $ (1,722)  $ (13,563)
Gain (loss) per Share:
Basic (in dollars per share)  $ 0.01   $ (0.02)  $ 0   $ (0.03)
Diluted (in dollars per share)  $ 0   $ (0.02)  $ 0   $ (0.03)
Weighted average shares outstanding, basic and diluted
Basic (in shares) 538,560,051 518,310,781 532,589,825 518,400,008
Diluted (in shares) 871,984,091 518,310,781 532,589,825 518,400,008
Accessory and Parts Revenue [Member]

 

 

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands    
     
Current Assets: Jun. 30, 2022 Dec. 31, 2021
Cash  $ 1,484   $ 619 
Accounts receivable, net of allowance for doubtful accounts of $0.8 million, respectively 1,749 2,415
Inventory 925 1,040
Prepaid expenses and other current assets 1,181 326
Total Current Assets 5,339 4,400
Property, Equipment and Other, net 535 1,118
Other Intangible Assets, net 5,489 5,841
Goodwill 7,260 7,260
Total Assets 18,623 18,619
Current Liabilities:    
Senior secured promissory note payable, in default 12,334 11,586
Convertible promissory notes payable, in default 6,523 11,601
Convertible promissory notes, related parties, in default 1,596 1,596
Short-term loans 1,484 0
Advances on future cash receipts 398 446
Accounts payable 7,083 7,644
Accrued expenses 5,900 4,394
Accrued employee compensation 4,264 4,247
Due under factoring agreement 1,792 1,737
Warrant liability 5,295 9,614
Current portion of SBA loans 272 158
Accrued interest 3,600 2,521
Accrued interest, related parties 402 289
Current portion of lease liabilities 185 268
Current portion of contract liabilities 64 48
Other 107 114
Total Current Liabilities 51,299 56,263
Non-current Liabilities    
SBA loans 761 875
Lease liabilities 40 118
Contract liabilities 295 293
Deferred tax liability 28 28
Total Non-current Liabilities 1,124 1,314
Total Liabilities 52,423 57,577
Commitments and Contingencies (Footnote 11)    
STOCKHOLDERS' DEFICIT    
Preferred Stock, par value $0.001, 5,000,000 shares authorized; 6,175, 293, 90 and 8 shares designated Series A, Series B, Series C and Series D, respectively; no shares issued and outstanding at June 30, 2022 and December 31, 2021 0 0
Common Stock, par value $0.001, 800,000,000 shares authorized; 529,293,205 and 481,619,621 issued and outstanding at June 30, 2022 December 31, 2021, respectively 529 482
Additional Paid-in Capital 151,409 144,582
Accumulated Deficit -185,671 -183,949
Accumulated Other Comprehensive Loss -67 -73
Total Stockholders' Deficit -33,800 -38,958
Total Liabilities and Stockholders' Deficit  $ 18,623   $ 18,619 

 

 

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands 6 Months Ended
Jun. 30, 2022 Jun. 30, 2021
Cash Flows - Operating Activities:    
Net income (loss)  $ (1,722)  $ (13,552)
Adjustments to reconcile net loss to net cash used by operating activities    
Amortization of intangibles 352 352
Depreciation 94 198
Bad debt expense 52 240
Income tax expense 0 22
Shares issued for services 888 0
Loss on extinguishment of debt 211 0
Gain on sale of property and equipment, net -541 0
Change in fair value of derivative liabilities -11,343 -44
Loss on issuance of debt 3,434 2,484
Amortization of debt issuance costs and original issue discount 1,304 719
Accrued interest 1,078 390
Interest payable, related parties 112 95
Changes in operating assets and liabilities    
Accounts receivable - trade 733 218
Inventory 115 521
Prepaid expenses -855 -191
Other assets 47 -83
Accounts payable -562 1,475
Accrued expenses 1,407 1,350
Accrued employee compensation 103 553
Contract liabilities -108 4
Net Cash Used by Operating Activities -5,201 -5,249
Cash Flows - Investing Activities    
Proceeds from sale of property and equipment 948 0
Purchase of property and equipment 0 -277
Net Cash Flows Used in Investing Activities 948 -277
Cash Flows - Financing Activities    
Proceeds from senior promissory notes 2,940 1,263
Proceeds from short term notes 2,130 1,033
Proceeds from factoring 55 1,038
Proceeds from warrant exercises 100 0
Payments of principal on finance leases -121 -94
Proceeds from related party advances 0 125
Net Cash Flows Provided by Financing Activities 5,104 3,365
Effect of Exchange Rates on Cash 14 -12
Net Change in Cash During Period 865 -2,173
Cash at Beginning of Period 619 2,437
Cash at End of Period 1,484 264
Supplemental Information:    
Cash paid for interest 2,045 1,434
Non-cash Investing and Financing Activities:    
Reclassification of warrant liability due to cashless warrant exercise 2,167 2,030
Warrants issued in conjunction with senior secured promissory note payable 2,654 0
Common shares issued in conjunction with senior secured promissory note payable 3,720 0
Embedded conversion option with issuances of convertible debt 0 2,740
Warrant issuance in conjunction with convertible debt  $ 0   $ 758