Market Overview

Mauna Kea Technologies Reports Second Quarter and First Half 2018 Sales

Share:

U.S. momentum underway with 12 new Cellvizio® deals in Q2, including
11 consignments vs. 2 in Q2 2017

US sales Q2 2018 up 56% vs. Q2 2017, with miniprobes sales up 60%

Global sales Q2 2018 stable vs. Q2 2017, with miniprobes sales up 33%

Mauna Kea Technologies will host a conference call today at 1:15 PM
(ET / New York time) to discuss the Company's second quarter and first
half 2018 sales results and to provide a business update. The conference
call will be hosted by Sacha Loiseau, CEO, and Christophe Lamboeuf, CFO.
To access the conference call, please use one of the following dial-in
numbers at least 5 minutes prior to the scheduled start time and follow
the instructions: USA: +1 877-407-4018 / UK: +44 (0) 800-756-3429 / FR:
+33 (0) 800-912-848. The passcode for the conference call is: 13681934.
Following the conclusion of the live call, a replay will be available
for seven days. To access the replay, please dial one of the following
numbers: USA: +1 844-512-2921 / UK/FR: +1 412-317-6671. The passcode for
the replay is: 13681934.

Regulatory News:

Mauna Kea Technologies (Paris:MKEA) (OTCQX:MKEAY) (Euronext:
MKEA, OTCQX: MKEAY, MKEAF) inventor of Cellvizio®, the multidisciplinary
confocal laser endomicroscopy platform, today announced its sales for
the second quarter 2018 and for the half-year ended June 30, 2018.

Sacha Loiseau, Ph.D., Founder and Chief Executive Officer of Mauna Kea
Technologies, stated, "In the second quarter, we began to see the
benefits of having a complete U.S. commercial team in the field. Our
commercial focus, which emphasizes pay-per-use agreements in the U.S.,
is gaining traction as we placed more consignment systems in the first
six months of 2018 than we did in all of 2017. Second quarter global
consumables sales, which we view as a key leading indicator for
recurring revenues, were up 33% over the second quarter of 2017 and more
importantly, were up 60% in the U.S. However, there is an inherent lag
between initial system placements and revenue ramp up in our pay-per-use
model, and we are not yet benefitting from the full effect of our
installed base growth. We are working hard to continue driving wider
adoption and higher utilization of Cellvizio®, with increasing efforts
on reimbursement coverage and peer-to-peer training. We are encouraged
by the current momentum in the U.S. as well as in Asia-Pacific, where we
continue to see growing investments on the part of our partner in China,
which has yielded 8% growth for the first half."

Second Quarter 2018 Sales by Category

(in € thousands) – IFRS  

Q2 2018
(June 30, 2018)

 

 

Q2 2017
(June 30, 2017)

 

  Change %
Systems   617   838   (26%)
Consumables   751   564   33%
o/w pay-per-use program   193   180   8%
Services   297   284   5%
Total Sales   1,665   1,686   (1%)

Total sales for the second quarter were €1.7 million, which was in line
with the second quarter of last year. The 26% decline in system sales
was compensated by a 33% increase in consumables, reflecting the
Company's successful focus on its recurring revenue model. This shift in
focus is expected to continue to drive recurring revenue growth in
future quarters.

When compared to the first quarter of 2018, total sales increased 60%,
driven by a 68% increase in consumables coupled with a 65% increase in
system sales. The increase in consumables was due to a 69% increase in
U.S. pay-per-use sales, while the increase in system sales was primarily
attributable to placements in China. There were no sales to the
Company's partner, Cook Medical, in the second quarter.

Second quarter 2018 Unit Sales by Type

Units   Q2 2018   Q2 2017   Change %
New systems straight sales (per unit) 6 9 (33%)
New consignments placed 11 2 450%
 
Probes 163 129 26%
o/w reorders or pay-per-use 146 107 36%

Shipped consumable probes unit volume for the quarter was 163 units, an
increase of 26% compared to 129 probes sold in the second quarter of
2017. Probe reorders and pay-per-use orders totaled 146 this quarter, an
increase of 36% compared to 107 for the same period in 2017.

First Half 2018 Sales

(in € thousands) – IFRS     2018   2017   Change %
1st Quarter       1,042   1,599   (35%)
2nd Quarter       1,665   1,686   (1%)
q/q % growth 60% 5%
Total 1H Sales       2,707   3,285   (18%)

First-half 2018 sales declined 18% compared with a year ago, primarily
attributable to a 35% decline in the first quarter compared with the
first quarter of 2017. This was partially offset by accelerating
momentum in the second quarter, with total Q2 sales essentially flat on
a year-over-year basis, and up 60% sequentially on strong growth in
consumables sales.

First Half 2018 Sales by Category

(in € thousands) – IFRS   2018

(June 30, 2018)

  2017

(June 30, 2017)

  Change %
Systems   990   1,522   (35%)
Consumables   1,197   1,098   9%
o/w pay-per-use program   308   357   (14%)
Services   520   664   (22%)
Total Sales   2,707   3,285   (18%)

The Company shipped 25 Cellvizio® systems in the first half of 2018,
including 16 systems placed under the Company's pay-per-use program,
compared to 22 systems in the first half of 2017, including 8 systems
under the pay-per-use program. First half revenue from the pay-per-use
program declined 14% year-over-year due low usage associated with
limited commercial personnel in place in the United States in the first
quarter.

First Half 2018 Quarterly Sales by Geography with split by activity
(Clinical / Pre-clinical)

(in € thousands) – IFRS   Q1 2018   Q2 2018   1H 2018       Q1 2017   Q2 2017   1H 2017       1H 2018 Change %

US & Canada1

  459   866   1,326       824   556   1,379       (4%)
Clinical   446   846   1,291       844   539   1,383       (7%)
Pre-clinical   14   21   35       -20   18   -4       900%
Asia-Pacific   242   485   728       202   476   677       7%
Clinical   242   319   561       171   262   433       29%
Pre-clinical   0   166   166       31   213   244       (32%)
EMEA   337   294   630       547   502   1,049       (40%)
Clinical   74   259   333       219   419   638       (48%)
Pre-clinical   263   35   297       328   83   411       (28%)
LATAM   4   19   23       27   153   180       (87%)
Clinical   4   19   23       27   153   180       (87%)
Pre-clinical   0   0   0       0   0   0       --
Total Clinical Sales   766   1,443   2,209       1,260   1,372   2,634       (16%)
Total Pre-clinical Sales   276   222   498       338   313   651       (23%)
Total Sales   1,042   1,665   2,707       1,599   1,686   3,285       (18%)

Clinical sales

Clinical sales in the US & Canada in the first half of 2018 were €1.3
million, a decrease of 7% compared to the same period last year. A total
of 16 systems were consigned to the U.S. & Canada in the first half of
the year, of which 11 systems were placed during the second quarter in
addition to the five placed during the first quarter, reflecting the
U.S. sales team's early ability to execute. The 16 systems consigned in
the first half of 2018 represent a 100% progression compared to first
half 2017 placements of 8 systems, and exceeds the 13 systems placed for
all of 2017.

Clinical sales increased by 29% in the Asia-Pacific region as the
Company continued generating top-line growth in China, driven by our
partner's activities. This was offset by a 48% decline in EMEA coupled
with an 87% decline in LATAM as the Company continued to focus its
resources on the growth of its core clinical business in the U.S.

Pre-clinical sales

As stated in prior quarters, pre-clinical sales are by nature less
recurring than clinical ones, resulting in a difficult comparison from
one period to another. Pre-clinical sales declined by 23% in the first
half 2018 compared to the year-ago period.

First Half 2018 Quarterly Unit Sales by Type

Units   Q1   Q2   1H18       Q1   Q2   1H17   Change % 1H
New systems straight sales (per unit)   3   6   9       5   9   14   -35%
New consignments placed   5   11   16       6   2   8   +100%
                                 
Probes   106   163   269       125   129   254   +6%
o/w reorders or pay-per-use   101   146   247       115   107   222   +14%

Shipped consumable probes unit volume was 269 units, an increase of 6%
compared to 254 probes sold in the first half of 2017. Probe reorders
and pay-per-use orders totaled 247 in the first half of 2018, an
increase of 14% compared to 222 probes shipped in the first half of 2017.

About Mauna Kea Technologies
Mauna Kea Technologies is a
global medical device company focused on eliminating uncertainties
related to the diagnosis and treatment of cancer and other diseases
thanks to real time in vivo microscopic visualization. The Company's
flagship product, Cellvizio®, has received clearance to sell for a wide
range of applications in more than 40 countries, including the United
States, Europe, Japan, China, Canada, Brazil and Mexico. For more
information on Mauna Kea Technologies, visit www.maunakeatech.com

Disclaimer
This press release contains forward-looking
statements concerning Mauna Kea Technologies and its activities. Such
forward looking statements are based on assumptions that Mauna Kea
Technologies considers to be reasonable. However, there can be no
assurance that the anticipated events contained in such forward-looking
statements will occur. Forward- looking statements are subject to
numerous risks and uncertainties including the risks set forth in the
registration document of Mauna Kea Technologies registered by the French
Financial Markets Authority (Autorité des marchés financiers (AMF)) on
April 27, 2018 under number R.18-0429 and available on the Company's
website (www.maunakeatech.com),
and to the development of economic situation, financial markets, and the
markets in which Mauna Kea Technologies operates. The forward-looking
statements contained in this release are also subject to risks unknown
to Mauna Kea Technologies or that Mauna Kea Technologies does not
consider material at this time. The realization of all or part of these
risks could lead to actual results, financial conditions, performances
or achievements by Mauna Kea Technologies that differ significantly from
the results, financial conditions, performances or achievements
expressed in such forward-looking statements. This press release and the
information it contains do not constitute an offer to sell or to
subscribe for, or a solicitation of an order to purchase or subscribe
for, Mauna Kea Technologies shares in any country.

1 US & Canada sales previously reported with LATAM sales as
Americas.

View Comments and Join the Discussion!