Digirad Corporation (Nasdaq: DRAD; DRADP) (“Digirad” or the
“Company”) reported today its financial results for the second
quarter (Q2) and six months (6M) ended June 30, 2020.
Q2 2020 Financial Highlights vs. Q2 2019*
- Total revenue decreased to $22.3
million from $25.8 million
- Gross profit decreased to $4.0
million from $5.0 million
- Net loss from continuing operations
was $1.3 million (or $0.42 per basic and diluted share) compared to
a net loss of $1.5 million (or $0.72 per basic and diluted share)
**
- Non-GAAP adjusted EBITDA from
continuing operations decreased to $1.8 million from $2.1
million
- Non-GAAP free cash outflow of $0.6
million versus inflow of $3.3 million
- Cash and cash equivalents and
restricted cash of $9.3 million versus $1.0 million and net debt
was $16.5 million versus $14.3 million
6M 2020 Financial Highlights vs. 6M
2019*
- Total revenue increased to $51.2
million from $49.7 million
- Gross profit decreased to $8.5
million from $9.0 million
- Net loss from continuing operations
was $4.2 million (or $1.66 per basic and diluted share) compared to
a net loss from continuing operations of $3.1 million (or $1.54 per
basic and diluted share) **
- Non-GAAP adjusted EBITDA from
continuing operations decreased to $2.3 million from $2.9
million
* Since September 10, 2019, Digirad has been
operating as a diversified holding company (“HoldCo”) with three
divisions: Healthcare, Building & Construction, and Real Estate
& Investments. Digirad’s Q2 2020 and 6M 2020 results include
financial and operational data for the two newly created divisions
- Building & Construction and Real Estate & Investments. No
operational or financial data was recorded in the 2019
corresponding periods for these two divisions.
** In May 28, 2020, Digirad completed a public
offering through the issuance of 2,225,000 shares of its common
stock. Per share amounts for Q2 2020 and 6M 2020 periods, reflect
the new share count.
Jeff Eberwein, Chairman of Digirad, noted, “Our
Q2 2020 operations and financial results were impacted by the
nationwide shutdown due to COVID-19. Revenue for all three
businesses of our Healthcare division declined as many doctor
offices temporarily closed in mid-March and many hospitals
temporarily suspended non-emergency scanning procedures. In late
June, we noticed a slow but steady return to normal operations at
both doctor offices and hospitals.”
“Our Building & Construction division
experienced some startup delays in Q2 on several commercial
projects, but our outlook for the rest of the year is strong. KBS
was recently awarded two significant commercial projects – a $5.2
million contract to manufacture living units for the U.S. Army and
a $2.0 million contract to manufacture housing units for military
veterans. Deliveries for these projects are expected to be
completed before year-end. To meet the higher manufacturing
requirements for these two commercial projects, KBS recently hired
back all factory employees previously furloughed due to COVID-19
and increased its work force by an incremental 20%. Our growth
strategy for the Building & Construction division is to further
expand the commercial construction business for KBS in the New
England market. If KBS grows as expected in 2020, we will explore
re-opening our Oxford, Maine plant, which we believe would
effectively double KBS’s production capacity.”
Mr. Eberwein concluded, “We continue to execute
on our HoldCo growth strategy and value enhancement initiatives to
maximize stockholder value. Our HoldCo structure allows division
CEOs to focus on operations and growth, while HoldCo management
focuses on capital allocation. In addition to looking for
attractive bolt-on acquisitions for our existing operating
businesses, we will also look to create new business divisions in
the future through the disciplined acquisition of businesses
complementary to our HoldCo structure. Also, we are exploring the
potential divestiture of non-strategic assets.”
Revenue
The Company’s total Q2 2020 revenue decreased by 13.4% to $22.3
million from $25.8 million in the second quarter of the prior year.
6M 2020 total revenue of $51.2 million slightly increased from 6M
2019 revenue of $49.7 million.
|
Revenue in $ million |
|
Q2 2020 |
|
Q2 2019 |
|
% change |
|
6M 2020 |
|
6M 2019 |
|
% change |
|
Healthcare |
|
$ |
17,305 |
|
|
$ |
25,798 |
|
|
(32.9 |
)% |
|
$ |
40,647 |
|
|
$ |
49,710 |
|
|
(18.2 |
)% |
|
Building & Construction |
|
5,035 |
|
|
— |
|
|
— |
% |
|
10,519 |
|
|
— |
|
|
— |
% |
| Real Estate &
Investments |
|
161 |
|
|
— |
|
|
— |
% |
|
350 |
|
|
— |
|
|
— |
% |
|
Corporate, eliminations and other |
|
(159 |
) |
|
— |
|
|
— |
% |
|
(317 |
) |
|
— |
|
|
— |
% |
|
Total Revenue |
|
$ |
22,342 |
|
|
$ |
25,798 |
|
|
(13.4 |
)% |
|
$ |
51,199 |
|
|
$ |
49,710 |
|
|
3.0 |
% |
Revenue for the Healthcare division for Q2 2020
decreased from Q2 2019 by $8.5 million, offset by a $5.0 million
increase in Building and Construction revenue. The decrease in
revenue for the Healthcare division was due to the COVID-19
pandemic as many doctors’ offices were temporarily closed and many
hospitals stopped performing non-emergency procedures, tests, and
scans.
Gross Profit
|
Gross Profit in $ million |
|
Q2 2020 |
|
Q2 2019 |
|
% change |
|
6M 2020 |
|
6M 2019 |
|
% change |
|
Healthcare |
|
$ |
3,036 |
|
|
$ |
5,181 |
|
|
(41.4 |
)% |
|
$ |
7,109 |
|
|
$ |
9,162 |
|
|
(22.4 |
)% |
|
Building & Construction |
|
1,053 |
|
|
— |
|
|
— |
% |
|
1,456 |
|
|
— |
|
|
— |
% |
|
Real Estate & Investments |
|
95 |
|
|
(177 |
) |
|
(153.7 |
)% |
|
218 |
|
|
(177 |
) |
|
(223.2 |
)% |
|
Corporate, eliminations and other |
|
(158 |
) |
|
— |
|
|
— |
% |
|
(316 |
) |
|
— |
|
|
— |
% |
|
Total Gross Profit |
|
$ |
4,026 |
|
|
$ |
5,004 |
|
|
(19.5 |
)% |
|
$ |
8,467 |
|
|
$ |
8,985 |
|
|
(5.8 |
)% |
Q2 2020 gross profit for the Healthcare division
decreased by 41.4% from the prior year’s quarter due to reduced
revenue as a result of the COVID-19 pandemic.
Operating Expenses
Q2 2020 marketing, sales, general and
administrative (MSG&A) expenses decreased by 2.4% or
$0.1 million from the prior year period, mainly due to costs
savings from lower travelling costs and marketing and selling
expenses offset by MSG&A expenses for the Building and
Construction division. Our 6M 2020 MSG&A expenses increased by
13.2% or $1.3 million, compared to the same period of 2019 due
to the addition of MSG&A in the Building and Construction
division.
Non-GAAP Adjusted EBITDA
Q2 2020 non-GAAP adjusted EBITDA from continuing
operations decreased to $1.8 million from $2.1 million in the same
quarter of the prior year due to lower revenue generated from
high-margin mobile scanning services because of the COVID-19
pandemic. 6M 2020 non-GAAP adjusted EBITDA from continuing
operations decreased to $2.3 million, compared to $2.9 million in
the prior year period, reflecting COVID-19 impact.
Net Loss
Q2 2020 net loss from continuing operations for
the second quarter was $1.3 million, or $0.42 per basic and diluted
share, compared to net loss of $1.5 million, or $0.72 per basic and
diluted share, in the same period in the prior year. Q2 2020
non-GAAP adjusted net loss from continuing operations was $0.3
million, or $0.11 per basic and diluted share, compared to adjusted
net income of $0.1 million, or $0.04 per basic and diluted share,
in the prior year period.
6M 2020 net loss from continuing operations was
$4.2 million, or $1.66 per basic and diluted share, compared to net
loss from continuing operations of $3.1 million, or $1.54 per basic
and diluted share, in the same period in the prior year. 6M 2020
non-GAAP adjusted net loss from continuing operations decreased to
$2.0 million, or $0.78 per basic and diluted share, compared to
adjusted net loss of $0.9 million, or $0.46 per basic and diluted
share, in the prior year period.
Operating cash flow
Q2 2020 cash flow from operations was an outflow
of $0.6 million, compared to an inflow of $2.6 million for the same
period in the prior year. 6M 2020 cash flow from operations was an
inflow of $49 thousand, compared to an inflow of $0.4 million for
the prior year period.
Free Cash Flow
The Company calculates a non-GAAP measure of
free cash flow. The Company defines free cash flow as net cash
provided by (used in) operating activities, less purchases of
property and equipment, plus net dispositions of property and
equipment, and the acquisition-related net working capital. The
Company believes this measure of free cash flow provides management
and investors further useful information about cash generation (or
use) in our primary operations.
Q2 2020 non-GAAP free cash flow was an outflow
of $0.6 million, compared to an inflow of $3.3 million in the same
quarter in the prior year period. 6M 2020 non-GAAP free cash flow
was an outflow of $38 thousand, compared to an inflow of $1.2
million in the prior year period.
Net Operating Loss Carryforward
(NOL)
Digirad Corporation has approximately $91.6
million of usable net operating losses (“NOL”) in the U.S. as of
year end 2019, which the Company considers to be a very valuable
asset for its stockholders. In order to protect the value of
the NOL for all stockholders, the Company has a charter amendment
in place limiting beneficial ownership of Digirad common stock to
4.99%. Stockholders who wish to own more than 4.99% of Digirad
common stock, or who already own more than 4.99% of Digirad common
stock and wish to buy more, may only acquire additional shares with
the Board’s prior written approval.
Conference Call Information
A conference call is scheduled for 11:00 a.m. ET
(8:00 a.m. PT) on August 13, 2020 to discuss the results and
management’s outlook. The call may be accessed by dialing
1-877-407-9039 (international callers: +1-201-689-8470) five
minutes prior to the scheduled start time and referencing Digirad.
A simultaneous webcast of the call may be accessed online from the
Events & Presentations link on the Investor Relations page at
http://ir.digirad.com/events-presentations; an archived replay of
the webcast will be available within 15 minutes of the end of the
conference call.
If you have any questions, either prior to or after our
scheduled Earnings Conference call, please e-mail
ir@digirad.com or lcati@equityny.com.
Use of Non-GAAP Financial Measures by
Digirad Corporation
This release presents the non-GAAP financial
measures “adjusted net income (loss),” “adjusted net income (loss)
per basic and diluted share,” “free cash flow”, and “adjusted
EBITDA from continuing operations.” The most directly comparable
measure for these non-GAAP financial measures are “net income and
basic and diluted net income per share”, and “cash flows from
operating activities”. The Company has included below unaudited
adjusted financial information, which presents the Company’s
results of operations after excluding acquired intangible asset
amortization, one time transaction costs, litigation costs,
restructuring costs, loss on sale of buildings, COVID-19 protection
equipment, unrealized gain (loss) on available-for-sale securities,
non-recurring costs related to sales and use tax and income tax
adjustments. Further excluded in the measure of adjusted EBITDA are
interest, taxes, depreciation, amortization, and stock-based
compensation.
A discussion of the reasons why management
believes that the presentation of non-GAAP financial measures
provides useful information to investors regarding Digirad’s
financial condition and results of operations is included as
Exhibit 99.2 to Digirad’s report on Form 8-K filed with the
Securities and Exchange Commission on August 13, 2020.
About Digirad Corporation
Digirad Corporation is a diversified holding
company with three divisions: Healthcare, Building &
Construction, and Real Estate & Investments.
Healthcare Division (Digirad
Health)
Digirad Health designs, manufactures, and
distributes diagnostic medical imaging products and services.
Digirad Health operates in three businesses: Diagnostic Imaging,
Diagnostic Services, and Mobile Healthcare. The Diagnostic Imaging
business designs, manufactures, and sells proprietary solid-state
gamma cameras. It also services the installed base of these
proprietary cameras. The Diagnostic Services business offers
imaging and monitoring services to healthcare providers as an
alternative to purchasing equipment or outsourcing procedures. The
Mobile Healthcare business provides contract diagnostic imaging,
including computerized tomography (“CT”), magnetic resonance
imaging (“MRI”), positron emission tomography (“PET”), PET/CT, and
nuclear medicine and healthcare expertise through a convenient,
mobile service.
Building & Construction Division
(ATRM)
ATRM Holdings, Inc. (“ATRM”) manufactures
modular housing units for commercial and residential real estate
projects. ATRM operates in two businesses: (i) modular building
manufacturing and (ii) structural wall panel and wood foundation
manufacturing, including building supply retail operations. The
modular building manufacturing business is operated by KBS
Builders, Inc. (“KBS”), the structural wall panel and wood
foundation manufacturing segment is operated by EdgeBuilder, Inc.
(“EdgeBuilder”), and the retail building supplies are sold through
Glenbrook Building Supply, Inc. (“Glenbrook”). KBS, EdgeBuilder,
and Glenbrook are wholly-owned subsidiaries of ATRM, which is a
wholly-owned subsidiary of Digirad.
Real Estate & Investments
Division
This business division manages the Company’s
real estate assets and investments.
Forward-Looking Statements
“Safe Harbor” Statement under the Private
Securities Litigation Reform Act of 1995: This release contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. All statements in this
release that are not statements of historical fact are hereby
identified as “forward-looking statements” for the purpose of the
safe harbor provided by Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. Forward-looking Statements include, without limitation,
statements regarding (i) the plans and objectives of management for
future operations, including plans or objectives relating to
acquisitions and related integration, development of commercially
viable products, novel technologies, and modern applicable
services, (ii) projections of income (including income/loss),
EBITDA, earnings (including earnings/loss) per share, free cash
flow (FCF), capital expenditures, cost reductions, capital
structure or other financial items, (iii) the future financial
performance of Digirad Corporation or acquisition targets and (iv)
the assumptions underlying or relating to any statement described
above. Moreover, forward-looking statements necessarily involve
assumptions on the Company’s part. These forward-looking statements
generally are identified by the words “believe”, “expect”,
“anticipate”, “estimate”, “project”, “intend”, “plan”, “should”,
“may”, “will”, “would”, “will be”, “will continue” or similar
expressions. Such forward-looking statements are not meant to
predict or guarantee actual results, performance, events or
circumstances and may not be realized because they are based upon
the Company's current projections, plans, objectives, beliefs,
expectations, estimates and assumptions and are subject to a number
of risks and uncertainties and other influences, many of which the
Company has no control over. Actual results and the timing of
certain events and circumstances may differ materially from those
described above as a result of these risks and uncertainties.
Factors that may influence or contribute to the inaccuracy of
forward-looking statements or cause actual results to differ
materially from expected or desired results may include, without
limitation, the substantial amount of debt of the Company and the
Company’s ability to repay or refinance it or incur additional debt
in the future; the Company’s need for a significant amount of cash
to service and repay the debt and to pay dividends on the Company
preferred stock; the restrictions contained in the debt agreements
that limit the discretion of management in operating the business;
the length of time associated with servicing customers; losses of
significant contracts; disruptions in the relationship with third
party vendors; accounts receivable turnover; insufficient cash
flows and resulting in liquidity; the Company's inability to expand
the Company's business; unfavorable changes in the extensive
governmental legislation and regulations governing healthcare
providers and the provision of healthcare services and the
competitive impact of such changes (including unfavorable changes
to reimbursement policies); high costs of regulatory compliance;
the liability and compliance costs regarding environmental
regulations; the underlying condition of the technology support
industry; the lack of product diversification; development and
introduction of new technologies and intense competition in the
healthcare industry; existing or increased competition; risks to
the price and volatility of the Company’s common stock and
preferred stock; stock volatility and in liquidity; risks to
preferred stockholders of not receiving dividends and risks to the
Company’s ability to pursue growth opportunities if the Company
continues to pay dividends according to the terms of the Company
preferred stock; the Company’s ability to execute on its business
strategy (including any cost reduction plans); the Company’s
failure to realize expected benefits of restructuring and
cost-cutting actions; the Company’s ability to preserve and
monetize its net operating losses; risks associated with the
Company’s possible pursuit of acquisitions; the Company’s ability
to consummate successful acquisitions and execute related
integration, including to successfully integrate ATRM’s operations
and realize the synergies from the acquisition of ATRM, as well as
factors related to the Company’s business (including ATRM)
including economic and financial market conditions generally and
economic conditions in the Company’s markets; failure to keep pace
with evolving technologies and difficulties integrating
technologies; system failures; losses of key management personnel
and the inability to attract and retain highly qualified management
and personnel in the future; and the continued demand for and
market acceptance of the Company’s services. For a detailed
discussion of cautionary statements and risks that may affect the
Company’s future results of operations and financial results,
please refer to the Company’s filings with the Securities and
Exchange Commission, including, but not limited to, the risk
factors in the Company’s most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q. This release reflects management’s
views as of the date presented.
All forward-looking statements are necessarily
only estimates of future results, and there can be no assurance
that actual results will not differ materially from expectations,
and, therefore, you are cautioned not to place undue reliance on
such statements. Further, any forward-looking statement speaks only
as of the date on which it is made, and we undertake no obligation
to update any forward-looking statement to reflect events or
circumstances after the date on which the statement is made or to
reflect the occurrence of unanticipated events.
|
For more information contact: |
|
| Digirad Corporation |
The Equity Group |
| Jeffrey E. Eberwein |
Lena Cati |
| Chairman of the Board |
The Equity Group |
| 203-489-9501 |
212-836-9611 |
| ir@digirad.com |
lcati@equityny.com |
(Financial tables follow)
Digirad
CorporationCondensed Consolidated Statements of
Operations and Comprehensive Income
(Loss)(Unaudited)(In thousands,
except for per share amounts)
| |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
| |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| Revenues: |
|
|
|
|
|
|
|
|
|
Healthcare |
|
$ |
17,305 |
|
|
$ |
25,798 |
|
|
$ |
40,647 |
|
|
$ |
49,710 |
|
|
Building and Construction |
|
5,035 |
|
|
— |
|
|
10,519 |
|
|
— |
|
|
Real Estate and Investments |
|
2 |
|
|
— |
|
|
33 |
|
|
— |
|
|
Total revenues |
|
22,342 |
|
|
25,798 |
|
|
51,199 |
|
|
49,710 |
|
| Cost of revenues: |
|
|
|
|
|
|
|
|
|
Healthcare |
|
14,268 |
|
|
20,617 |
|
|
33,538 |
|
|
40,548 |
|
|
Building and Construction |
|
3,982 |
|
|
— |
|
|
9,063 |
|
|
— |
|
|
Real Estate and Investments |
|
66 |
|
|
177 |
|
|
131 |
|
|
177 |
|
|
Total cost of revenues |
|
18,316 |
|
|
20,794 |
|
|
42,732 |
|
|
40,725 |
|
| Gross profit |
|
4,026 |
|
|
5,004 |
|
|
8,467 |
|
|
8,985 |
|
| Operating expenses: |
|
|
|
|
|
|
|
|
|
Marketing, sales and general and administrative expenses |
|
4,751 |
|
|
4,867 |
|
|
10,979 |
|
|
9,700 |
|
|
Amortization of intangible assets |
|
801 |
|
|
283 |
|
|
1,618 |
|
|
566 |
|
|
Merger and finance costs |
|
— |
|
|
1,000 |
|
|
— |
|
|
1,000 |
|
|
Total operating expenses |
|
5,552 |
|
|
6,150 |
|
|
12,597 |
|
|
11,266 |
|
| Loss from operations |
|
(1,526 |
) |
|
(1,146 |
) |
|
(4,130 |
) |
|
(2,281 |
) |
| Other income (expense): |
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
672 |
|
|
(5 |
) |
|
832 |
|
|
(203 |
) |
|
Interest expense, net |
|
(383 |
) |
|
(254 |
) |
|
(858 |
) |
|
(435 |
) |
|
Loss on sale of building |
|
— |
|
|
(232 |
) |
|
— |
|
|
(232 |
) |
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
(151 |
) |
| Total other income
(expense) |
|
289 |
|
|
(491 |
) |
|
(26 |
) |
|
(1,021 |
) |
| Loss before income taxes |
|
(1,237 |
) |
|
(1,637 |
) |
|
(4,156 |
) |
|
(3,302 |
) |
|
Income tax (expense) benefit |
|
(50 |
) |
|
162 |
|
|
(84 |
) |
|
170 |
|
| Net loss from continuing
operations |
|
(1,287 |
) |
|
(1,475 |
) |
|
(4,240 |
) |
|
(3,132 |
) |
| Net income from discontinued
operations |
|
— |
|
|
266 |
|
|
— |
|
|
266 |
|
| Net loss |
|
(1,287 |
) |
|
(1,209 |
) |
|
(4,240 |
) |
|
(2,866 |
) |
|
Deemed dividend on Series A redeemable preferred stock |
|
(484 |
) |
|
— |
|
|
(968 |
) |
|
— |
|
| Net loss attributable to
common shareholders |
|
$ |
(1,771 |
) |
|
$ |
(1,209 |
) |
|
$ |
(5,208 |
) |
|
$ |
(2,866 |
) |
| |
|
|
|
|
|
|
|
|
| Net (loss) income per share -
basic and diluted |
|
|
|
|
|
|
|
|
|
Net loss per share, continuing operations attributable to common
shareholders |
|
$ |
(0.58 |
) |
|
$ |
(0.72 |
) |
|
$ |
(2.04 |
) |
|
$ |
(1.54 |
) |
|
Net income per share, discontinued operations attributable to
common shareholders |
|
— |
|
|
0.13 |
|
|
— |
|
|
0.13 |
|
| Net loss per share,
attributable to common shareholders — basic and diluted: |
|
$ |
(0.58 |
) |
|
$ |
(0.59 |
) |
|
$ |
(2.04 |
) |
|
$ |
(1.41 |
) |
| Weighted-average shares
outstanding – basic and diluted |
|
3,041 |
|
|
2,038 |
|
|
2,547 |
|
|
2,034 |
|
| |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
| Net loss |
|
$ |
(1,287 |
) |
|
$ |
(1,209 |
) |
|
$ |
(4,240 |
) |
|
$ |
(2,866 |
) |
| Other comprehensive income
(loss): |
|
|
|
|
|
|
|
|
|
Reclassification of tax provision impact |
|
— |
|
|
— |
|
|
— |
|
|
22 |
|
|
Total other comprehensive income |
|
— |
|
|
— |
|
|
— |
|
|
22 |
|
| Comprehensive loss |
|
$ |
(1,287 |
) |
|
$ |
(1,209 |
) |
|
$ |
(4,240 |
) |
|
$ |
(2,844 |
) |
Digirad
CorporationCondensed Consolidated Balance
Sheets(Unaudited)(In thousands,
except share amounts)
| |
|
June 30, 2020 |
|
December 31, 2019 |
| Assets: |
|
|
|
|
| Current assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
9,111 |
|
|
$ |
1,821 |
|
|
Restricted cash |
|
169 |
|
|
240 |
|
|
Equity securities |
|
27 |
|
|
26 |
|
|
Accounts receivable, net |
|
14,523 |
|
|
18,571 |
|
|
Inventories, net |
|
7,638 |
|
|
7,097 |
|
|
Other current assets |
|
1,433 |
|
|
1,794 |
|
|
Total current assets |
|
32,901 |
|
|
29,549 |
|
| Property and equipment,
net |
|
19,210 |
|
|
22,138 |
|
| Operating lease right-of-use
assets |
|
4,907 |
|
|
4,827 |
|
| Intangible assets, net |
|
21,286 |
|
|
22,903 |
|
| Goodwill |
|
9,978 |
|
|
9,978 |
|
| Other assets |
|
997 |
|
|
1,165 |
|
|
Total assets |
|
$ |
89,279 |
|
|
$ |
90,560 |
|
| |
|
|
|
|
| Liabilities, Mezzanine
Equity and Stockholders’ Equity |
|
|
|
|
| Current liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
5,807 |
|
|
$ |
8,932 |
|
|
Accrued compensation |
|
4,132 |
|
|
4,579 |
|
|
Accrued warranty |
|
272 |
|
|
421 |
|
|
Deferred revenue |
|
2,185 |
|
|
1,786 |
|
|
Short-term debt and current portion of long-term debt |
|
4,459 |
|
|
4,036 |
|
|
Payable to related parties |
|
2,155 |
|
|
1,920 |
|
|
Operating lease liabilities, current portion |
|
1,980 |
|
|
1,866 |
|
|
Other current liabilities |
|
3,270 |
|
|
4,638 |
|
|
Total current liabilities |
|
24,260 |
|
|
28,178 |
|
| Long-term debt, net of current
portion |
|
19,124 |
|
|
17,038 |
|
| Deferred tax liabilities |
|
89 |
|
|
23 |
|
| Operating lease liabilities,
net of current portion |
|
3,024 |
|
|
3,073 |
|
| Other liabilities |
|
1,102 |
|
|
1,551 |
|
|
Total liabilities |
|
47,599 |
|
|
49,863 |
|
| |
|
|
|
|
| Preferred stock, $0.0001 par
value: 10,000,000 shares authorized: 10% Series A Cumulative
Redeemable preferred stock, 8,000,000 shares liquidation preference
($10.00 per share), 1,915,637 shares issued or outstanding at June
30, 2020 and December 31, 2019, respectively |
|
20,570 |
|
|
19,602 |
|
| |
|
|
|
|
| Stockholders’ equity: |
|
|
|
|
|
Common stock, $0.0001 par value: 30,000,000 shares authorized;
4,692,451 and 2,050,659 shares issued and outstanding (net of
treasury shares) at June 30, 2020 and December 31, 2019,
respectively |
|
— |
|
|
— |
|
|
Treasury stock, at cost; 258,849 shares at June 30, 2020 and
December 31, 2019, respectively |
|
(5,728 |
) |
|
(5,728 |
) |
| Additional paid-in
capital |
|
149,607 |
|
|
145,352 |
|
| Accumulated deficit |
|
(122,769 |
) |
|
(118,529 |
) |
|
Total stockholders’ equity |
|
21,110 |
|
|
21,095 |
|
|
Total liabilities, mezzanine equity and stockholders’ equity |
|
$ |
89,279 |
|
|
$ |
90,560 |
|
Digirad
CorporationReconciliation of Non-GAAP Financial
Measures(Unaudited)(In thousands,
except per share amounts)
| |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
| |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| |
|
|
|
|
|
|
|
|
|
Net loss from continuing operations |
|
$ |
(1,287 |
) |
|
$ |
(1,475 |
) |
|
$ |
(4,240 |
) |
|
$ |
(3,132 |
) |
|
Acquired intangible amortization |
|
801 |
|
|
283 |
|
|
1,618 |
|
|
566 |
|
|
Unrealized (gain) loss on equity securities (1) |
|
(6 |
) |
|
5 |
|
|
20 |
|
|
(23 |
) |
|
Litigation costs (2) |
|
19 |
|
|
— |
|
|
179 |
|
|
— |
|
|
Restructuring costs (3) |
|
— |
|
|
62 |
|
|
— |
|
|
62 |
|
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
151 |
|
|
Loss on sale of buildings |
|
— |
|
|
232 |
|
|
— |
|
|
232 |
|
|
Write-off of DMS assets due to litigation (4) |
|
— |
|
|
— |
|
|
135 |
|
|
— |
|
|
Write-off of Star Real Estate Holding assets |
|
— |
|
|
143 |
|
|
— |
|
|
143 |
|
|
Transaction cost (5) |
|
— |
|
|
726 |
|
|
115 |
|
|
956 |
|
|
Write-off of preferred stock issuance cost (6) |
|
— |
|
|
273 |
|
|
— |
|
|
273 |
|
|
COVID -19 protection equipment (7) |
|
29 |
|
|
— |
|
|
29 |
|
|
— |
|
|
Sales and use tax costs (8) |
|
73 |
|
|
— |
|
|
73 |
|
|
— |
|
|
Income tax expense (benefit) |
|
50 |
|
|
(162 |
) |
|
84 |
|
|
(170 |
) |
| Non-GAAP adjusted net
(loss) income from continuing operations |
|
$ |
(321 |
) |
|
$ |
87 |
|
|
$ |
(1,987 |
) |
|
$ |
(942 |
) |
| |
|
|
|
|
|
|
|
|
| Net loss per diluted
share from continuing operations |
|
$ |
(0.42 |
) |
|
$ |
(0.72 |
) |
|
$ |
(1.66 |
) |
|
$ |
(1.54 |
) |
|
Acquired intangible amortization |
|
0.26 |
|
|
0.14 |
|
|
0.64 |
|
|
0.28 |
|
|
Unrealized (gain) loss on equity securities (1) |
|
— |
|
|
— |
|
|
0.01 |
|
|
(0.01 |
) |
|
Litigation costs (2) |
|
0.01 |
|
|
— |
|
|
0.07 |
|
|
— |
|
|
Restructuring costs (3) |
|
— |
|
|
0.03 |
|
|
— |
|
|
0.03 |
|
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
0.07 |
|
|
Loss on sale of buildings |
|
— |
|
|
0.11 |
|
|
— |
|
|
0.11 |
|
|
Write-off of DMS assets due to litigation (4) |
|
— |
|
|
— |
|
|
0.05 |
|
|
— |
|
|
Write-off of Star Real Estate Holding assets |
|
— |
|
|
0.07 |
|
|
— |
|
|
0.07 |
|
|
Transaction cost (5) |
|
— |
|
|
0.36 |
|
|
0.05 |
|
|
0.47 |
|
|
Write-off of preferred stock issuance cost (6) |
|
— |
|
|
0.13 |
|
|
— |
|
|
0.13 |
|
|
COVID -19 Protection Equipment (7) |
|
0.01 |
|
|
— |
|
|
0.01 |
|
|
— |
|
|
Sales and use tax costs (8) |
|
0.02 |
|
|
— |
|
|
0.03 |
|
|
— |
|
|
Income tax expense (benefit) |
|
0.02 |
|
|
(0.08 |
) |
|
0.03 |
|
|
(0.08 |
) |
| Non-GAAP adjusted net
(loss) income per basic and diluted share from continuing
operations (9) |
|
$ |
(0.11 |
) |
|
$ |
0.04 |
|
|
$ |
(0.78 |
) |
|
$ |
(0.46 |
) |
(1) Reflects change in fair value of investments
in equity securities.(2) Reflects one time litigation costs.(3)
Reflects severance related costs.(4) Reflects write-off of assets
related to litigation.(5) Reflects legal and other costs related to
the ATRM merger and HoldCo conversion.(6) Reflects write-off of
costs related to a potential offering of preferred stock the
Company did not complete.(7) Reflects purchases related to COVID
-19 Protection Equipment.(8) Reflects additional sales and use tax
as a result of a South Dakota sales tax audit.(9) Per share amounts
are computed independently for each discrete item presented.
Therefore, the sum of the quarterly per share amounts will not
necessarily equal to the total for the year, and sum of individual
items may not equal the total.
Digirad
CorporationReconciliation of Non-GAAP Financial
Measures(Unaudited)(In
thousands)
| |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
| |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
Net loss from continuing operations |
|
$ |
(1,287 |
) |
|
$ |
(1,475 |
) |
|
$ |
(4,240 |
) |
|
$ |
(3,132 |
) |
|
Unrealized (gain) loss on equity securities (1) |
|
(6 |
) |
|
5 |
|
|
20 |
|
|
(23 |
) |
|
Litigation costs (2) |
|
19 |
|
|
— |
|
|
179 |
|
|
— |
|
|
Restructuring costs (3) |
|
— |
|
|
62 |
|
|
— |
|
|
62 |
|
|
Loss on extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
151 |
|
|
Depreciation and amortization |
|
2,374 |
|
|
1,851 |
|
|
4,782 |
|
|
3,660 |
|
|
Stock-based compensation |
|
151 |
|
|
190 |
|
|
260 |
|
|
302 |
|
|
Write-off of DMS assets due to litigation (4) |
|
— |
|
|
— |
|
|
135 |
|
|
— |
|
|
Write-off of Star Real Estate Holding assets |
|
— |
|
|
143 |
|
|
— |
|
|
143 |
|
|
Loss on sale of building |
|
— |
|
|
232 |
|
|
— |
|
|
232 |
|
|
Interest expense, net |
|
383 |
|
|
254 |
|
|
858 |
|
|
435 |
|
|
Transaction cost (5) |
|
— |
|
|
726 |
|
|
115 |
|
|
956 |
|
|
Write-off of preferred stock issuance cost (6) |
|
— |
|
|
273 |
|
|
— |
|
|
273 |
|
|
COVID -19 protection equipment (7) |
|
29 |
|
|
— |
|
|
29 |
|
|
— |
|
|
Sales and use tax costs (8) |
|
73 |
|
|
— |
|
|
73 |
|
|
— |
|
|
Income tax expense (benefit) |
|
50 |
|
|
(162 |
) |
|
84 |
|
|
(170 |
) |
| Non-GAAP adjusted
EBITDA from continuing operations |
|
$ |
1,786 |
|
|
$ |
2,099 |
|
|
$ |
2,295 |
|
|
$ |
2,889 |
|
(1) Reflects change in fair value of investments
in equity securities.(2) Reflects one time litigation costs.(3)
Reflects severance related costs.(4) Reflects write-off of assets
related to litigation.(5) Reflects legal and other costs related to
the ATRM merger and HoldCo conversion.(6) Reflects write-off of
costs related to a potential offering of preferred stock the
Company did not complete.(7) Reflects purchases related to COVID-19
Protection Equipment.(8) Reflects additional sales and use tax as a
result of a South Dakota sales tax audit.
Digirad
CorporationReconciliation of Operating Cash Flow
to Free Cash Flow(Unaudited)(In
thousands)
| |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
| |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
Net cash (used in) provided by operating
activities |
|
$ |
(574 |
) |
|
$ |
2,553 |
|
|
$ |
49 |
|
|
$ |
368 |
|
| Less purchases of property and
equipment |
|
(128 |
) |
|
(1,059 |
) |
|
(286 |
) |
|
(1,446 |
) |
| Gross free cash flow |
|
(702 |
) |
|
1,494 |
|
|
(237 |
) |
|
(1,078 |
) |
| Plus net dispositions |
|
61 |
|
|
1,063 |
|
|
84 |
|
|
1,320 |
|
| Plus merger related net
working capital adjustment |
|
— |
|
|
726 |
|
|
115 |
|
|
956 |
|
| Free cash
flow |
|
$ |
(641 |
) |
|
$ |
3,283 |
|
|
$ |
(38 |
) |
|
$ |
1,198 |
|
Digirad
CorporationSupplemental Debt
Information(Unaudited)(In
thousands)
A summary of the Company’s credit facilities and
related party notes are as follows (in thousands):
| |
|
June 30, 2020 |
|
December 31, 2019 |
| |
|
Amount |
|
Weighted-Average InterestRate |
|
Amount |
|
Weighted-Average InterestRate |
|
Revolving Credit Facility - Gerber KBS |
|
$ |
1,180 |
|
|
6.00 |
% |
|
$ |
1,111 |
|
|
7.50 |
% |
| Revolving Credit Facility -
Premier |
|
— |
|
|
— |
% |
|
2,925 |
|
|
6.25 |
% |
| Total Short Term
Revolving Credit Facilities |
|
$ |
1,180 |
|
|
6.00 |
% |
|
$ |
4,036 |
|
|
6.59 |
% |
| Revolving Credit Facility -
SNB |
|
$ |
11,785 |
|
|
2.66 |
% |
|
$ |
17,038 |
|
|
4.26 |
% |
| Revolving Credit Facility -
Gerber EBGL |
|
1,374 |
|
|
6.00 |
% |
|
— |
|
|
— |
% |
| Total Long Term
Revolving Credit Facilities |
|
$ |
13,159 |
|
|
3.01 |
% |
|
$ |
17,038 |
|
|
4.26 |
% |
| LSV Co-Invest I Promissory
Note (“January Note”) |
|
$ |
668 |
|
|
12.00 |
% |
|
$ |
595 |
|
|
12.00 |
% |
| LSV Co-Invest I Promissory
Note (“June Note”) |
|
1,150 |
|
|
12.00 |
% |
|
1,023 |
|
|
12.00 |
% |
| LSVM Note |
|
337 |
|
|
12.00 |
% |
|
302 |
|
|
12.00 |
% |
| Total Notes Payable
From Related Parties |
|
$ |
2,155 |
|
|
12.00 |
% |
|
$ |
1,920 |
|
|
12.00 |
% |
| Short Term Paycheck Protection
Program Notes |
|
$ |
2,518 |
|
|
1.00 |
% |
|
$ |
— |
|
|
— |
% |
| Long Term Paycheck Protection
Program Notes |
|
4,130 |
|
|
1.00 |
% |
|
$ |
— |
|
|
— |
% |
| Total Paycheck
Protection Program Notes |
|
$ |
6,648 |
|
|
1.00 |
% |
|
$ |
— |
|
|
— |
% |
Term Loan Facilities
The following table presents the Star and
Premier term loans balance net of unamortized debt issuance costs
as of June 30, 2020 (in thousands):
| |
|
June 30, 2020 |
| |
|
Amount |
|
Gerber - Star Term Loan |
|
$ |
2,125 |
|
| Premier - Term Loan |
|
897 |
|
| Total Principal |
|
3,022 |
|
| Unamortized debt issuance
costs |
|
(426 |
) |
| Total |
|
$ |
2,596 |
|
Digirad
CorporationSupplemental Segment
Information(Unaudited)(In
thousands)
| |
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
| |
|
2020 |
|
2019 |
|
2020 |
|
2019 |
| Revenue by segment |
|
|
|
|
|
|
|
|
|
Diagnostic Services |
|
$ |
7,140 |
|
|
$ |
12,318 |
|
|
$ |
17,954 |
|
|
$ |
24,044 |
|
|
Diagnostic Imaging |
|
2,333 |
|
|
3,049 |
|
|
5,194 |
|
|
5,572 |
|
|
Mobile Healthcare |
|
7,832 |
|
|
10,431 |
|
|
17,499 |
|
|
20,094 |
|
|
Building and Construction |
|
5,035 |
|
|
— |
|
|
10,519 |
|
|
— |
|
|
Real Estate and Investments |
|
161 |
|
|
— |
|
|
350 |
|
|
— |
|
|
Corporate, eliminations and other |
|
(159 |
) |
|
— |
|
|
(317 |
) |
|
— |
|
| Consolidated revenue |
|
$ |
22,342 |
|
|
$ |
25,798 |
|
|
$ |
51,199 |
|
|
$ |
49,710 |
|
| |
|
|
|
|
|
|
|
|
| Gross profit by segment: |
|
|
|
|
|
|
|
|
|
Diagnostic Services |
|
$ |
953 |
|
|
$ |
2,805 |
|
|
$ |
2,958 |
|
|
$ |
5,386 |
|
|
Diagnostic Imaging |
|
1,232 |
|
|
1,080 |
|
|
2,101 |
|
|
1,866 |
|
|
Mobile Healthcare |
|
851 |
|
|
1,296 |
|
|
2,050 |
|
|
1,910 |
|
|
Building and Construction |
|
1,053 |
|
|
— |
|
|
1,456 |
|
|
— |
|
|
Real Estate and Investments |
|
95 |
|
|
(177 |
) |
|
218 |
|
|
(177 |
) |
|
Corporate, eliminations and other |
|
(158 |
) |
|
— |
|
|
(316 |
) |
|
— |
|
| Consolidated gross profit |
|
$ |
4,026 |
|
|
$ |
5,004 |
|
|
$ |
8,467 |
|
|
$ |
8,985 |
|
| |
|
|
|
|
|
|
|
|
| Income (loss) from continuing
operations by segment: |
|
|
|
|
|
|
|
|
|
Diagnostic Services |
|
$ |
515 |
|
|
$ |
1,957 |
|
|
$ |
1,539 |
|
|
$ |
3,693 |
|
|
Diagnostic Imaging |
|
934 |
|
|
565 |
|
|
1,455 |
|
|
908 |
|
|
Mobile Healthcare |
|
135 |
|
|
439 |
|
|
312 |
|
|
(184 |
) |
|
Building and Construction |
|
130 |
|
|
— |
|
|
(729 |
) |
|
— |
|
|
Real Estate and Investments |
|
10 |
|
|
(199 |
) |
|
116 |
|
|
(199 |
) |
|
Corporate, eliminations and other |
|
(158 |
) |
|
(2,908 |
) |
|
(316 |
) |
|
— |
|
|
Unallocated corporate and other expenses |
|
(3,092 |
) |
|
— |
|
|
(6,507 |
) |
|
(5,499 |
) |
| Segment loss from
operations |
|
(1,526 |
) |
|
(146 |
) |
|
(4,130 |
) |
|
(1,281 |
) |
|
Merger and finance costs |
|
— |
|
|
(1,000 |
) |
|
— |
|
|
(1,000 |
) |
| Consolidated loss from
operations |
|
$ |
(1,526 |
) |
|
$ |
(1,146 |
) |
|
$ |
(4,130 |
) |
|
$ |
(2,281 |
) |
| |
|
|
|
|
|
|
|
|
| Depreciation and amortization
by segment: |
|
|
|
|
|
|
|
|
|
Diagnostic Services |
|
$ |
307 |
|
|
$ |
305 |
|
|
$ |
637 |
|
|
$ |
609 |
|
|
Diagnostic Imaging |
|
66 |
|
|
73 |
|
|
129 |
|
|
151 |
|
|
Mobile Healthcare |
|
1,364 |
|
|
1,438 |
|
|
2,742 |
|
|
2,865 |
|
|
Building and Construction |
|
571 |
|
|
— |
|
|
1,143 |
|
|
— |
|
|
Real Estate and Investments |
|
66 |
|
|
35 |
|
|
131 |
|
|
35 |
|
| Total depreciation and
amortization |
|
$ |
2,374 |
|
|
$ |
1,851 |
|
|
$ |
4,782 |
|
|
$ |
3,660 |
|
Digirad (NASDAQ:DRAD)
過去 株価チャート
から 10 2024 まで 11 2024
Digirad (NASDAQ:DRAD)
過去 株価チャート
から 11 2023 まで 11 2024
