Quarterly Product Revenue Up 39% Year-over-Year;
Reiterates Full-Year Revenue Guidance of $6 Million
SOUTH ORANGE, NJ, May 9, 2018 /PR Newswire-FirstCall/ — Nephros, Inc. (OTCQB: NEPH) (“Nephros”), a commercial stage medical device company that develops and sells high performance liquid purification ultrafilters and an on-line mid-dilution hemodiafiltration system for use with a hemodialysis (HD) machine for the treatment of patients with End Stage Renal Disease (ESRD), today announced financial results for the three months ended March 31, 2018.
“Our 39% growth in the first quarter, traditionally a low season for waterborne pathogens, bodes well for continued strong growth in 2018,” said Daron Evans, President and Chief Executive Officer. “We continue to increase our hospital and dialysis clinic footprint thanks to the performance of our filtration devices and to the support of our strategic distributor partners in the field. We believe that we are on track for achieving our previously reported full-year revenue guidance of $6 million.”
Mr. Evans continued, “After our recent financing, our office relocation and expansion, and almost two years of year-over-year quarterly growth, we are now well positioned to execute on the expansion phase of the Nephros turnaround story. Over 2018 and 2019, we expect to continue our growth trajectory in the medical space, to push commercial versions of current medical products into new markets, to make progress on getting the second-generation HDF system to patients, and to opportunistically review potential additions to our water purification portfolio.”
Financial Performance for the Quarter Ended March 31, 2018
Product revenues for the three months ended March 31, 2018 were approximately $958,000, compared to approximately $690,000 for the three months ended March 31, 2017, an increase of approximately $268,000, or 39%. Total revenues for the three months ended March 31, 2018 were approximately $985,000 compared to approximately $734,000 for the three months ended March 31, 2017, an increase of approximately $251,000, or 34%.
Cost of goods sold was approximately $518,000 for the three months ended March 31, 2018 compared to approximately $279,000 for the three months ended March 31, 2017. Research and development expenses were approximately $289,000 and $231,000 for the three months ended March 31, 2018 and 2017, respectively. Selling, general and administrative expenses were approximately $1,260,000, for the three months ended March 31, 2018 compared to approximately $770,000 for the three months ended March 31, 2017, representing an increase of $490,000, or 64%.
As of March 31, 2018, Nephros had cash and cash equivalents of approximately $1,189,000. Subsequent to the end of the first quarter, and as previously announced on April 11, 2018, Nephros sold approximately 6.5 million shares of its common stock at a purchase price of $0.45 per share, resulting in total gross proceeds to Nephros of over $2.9 million.
About Nephros, Inc.
Nephros is a commercial stage medical device company that develops and sells high performance liquid purification filters, as well as a hemodiafiltration system for the treatment of patients with End Stage Renal Disease. Nephros filters or ultrafilters are used primarily in medical applications in various settings. These ultrafilters are used by dialysis centers for assisting in the added removal of biological contaminants from the water and bicarbonate concentrate supplied to hemodialysis machines and the patients. Additionally, Nephros ultrafilters are used in hospitals and medical clinics for added protection in retaining bacteria (i.e. Legionella, Pseudomonas), virus and endotoxin from water. These ultrafilters provide barriers that assist in improving infection control with showers, sinks, and ice machines.
For more information about Nephros, please visit its website at www.nephros.com.
This release contains forward-looking statements that are subject to various risks and uncertainties. Such statements include statements regarding Nephros’s expected financial results for the fiscal year ending December 31, 2018, its expected growth in medical, commercial and industrial filter sales, including the expansion into new markets, anticipated investment in the development of a second-generation HDF system, potential expansion of the water purification portfolio, and other statements that are not historical facts, including statements which may be accompanied by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. Actual results could differ materially from those described in these forward-looking statements due to certain factors, including uncertainty in clinical outcomes, potential delays in the regulatory approval process, changes in business, economic and competitive conditions, the availability of capital when needed, dependence on third party manufacturers and researchers, regulatory reforms, uncertainties in litigation or investigative proceedings, and the availability of financing. These and other risks and uncertainties are detailed in Nephros’s reports filed with the U.S. Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2017. Nephros does not undertake any responsibility to update the forward-looking statements in this release.
Andrew Astor, Chief Financial Officer