Aurora Spine Corporation Files Condensed Consolidated Financial Statements for the Three Months Ended March 31, 2020

NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES

CARLSBAD, Calif., July 09, 2020 (GLOBE NEWSWIRE) -- Aurora Spine Corporation (“Aurora Spine” or the “Company”) (TSXV: ASG) announces financial results for the First Quarter 2020, ended March 31, 2020.  All figures are in U.S. dollars.

To our Shareholders:

Q1 2020 started strongly for the Company based on several financial metrics and reflects significant research and development efforts.  However, it was affected significantly by COVID-19 due to the suspension of elective surgeries in the United States in March 2020.  In late May 2020, some hospitals reopened elective surgeries.

Highlights from Q1 2020

• COVID-19 - During Q1 2020, the entire world was struck with the COVID-19 pandemic. As a result of the government mandated close of business, the US government offered relief to small businesses. The Company applied for and received a $10,000 grant under the Economic Recovery Act and $450,888 under the CARES Act in the form of a Payroll Protection Program loan to fund payroll and other qualified expenses during the period of the business shutdown mandated by state governments. The loan is forgivable under certain terms and conditions. If those conditions are not met, the Company is required to return a portion of the principal at a rate of 1% interest. The Company intends to use a substantial portion of the loan for its intended purpose and does not expect to be required to return material amount of the debt.
• Revenue – During the quarter, we generated $2,259,251 in revenue, a reduction of $469,970 compared to the same period in 2019. The decline is primarily due to the COVID-19 pandemic that resulted in a mandatory cessation of elective surgeries in most states in early March 2020.
• Gross Profit – During the quarter, gross profit was $781,213 down by approximately $384k over the comparable quarter last year. The decline is due to the reduced revenues in March and a changing product mix.
• Cash Flow - Cash flow increased by almost $1.1 million since year-end after the private placement proceeds, collections of accounts receivable and spending on new inventory and instruments for the new lumbar product launches.
• EBITDAC – EBITDAC declined by approximately $388k primarily due to spending related to new product launch and research and development costs. EBITDAC is a non-GAAP, non IFRS measure defined as earnings before interest, taxes, depreciation, amortization and stock-based compensation.
• Net loss – Net loss increased to $560,543 compared to $205,601 for the same period last year.
• Product Development - The engineering team finalized product designs for a Posterior SI Joint fusion product made from cortical bone (SILO) and the ZIP-Flex interlamar fixation device. These products are an important part of our longer-term strategy through 2020 and 2021.
• Private Placement - In February 2020, the Company completed a private placement of 8,932,000 common shares for aggregate gross proceeds of CDN$2,333,000 (US$1,697,080). In connection with this offering, the Company paid cash commissions and fees of CDN$69,616 (US$59,281). A director of the Company subscribed to and received 1,579,000 shares in exchange for cash of CDN$394,750 (US$300,010). The net proceeds of the private placements are used for general working capital purposes. The proceeds of the February 2020 private placement will be, in part, used to fund the development and marketing of various product launches.

In the First Quarter of 2020, we continued driving growth by training surgeons and distributors on Aurora Spine’s technology and increasing the reach of our sales force.

We have added some outstanding surgeons to our customer base that value our products and wish to be a part of our success. We continue to review our new product development within the framework of financial responsibility to achieve our long-term growth and profitability objectives while reacting to, and recovering from the disruption caused by the COVID-19 pandemic.

We remain fully committed to developing our U.S. sales through engaging new and existing distributors and improving our direct relationship experience with our surgeons. This should allow us to generate increased sales and provide improved customer service going forward.

Management and I thank our shareholders for their continued support in these endeavors.    

None of this would be possible without the dedication and commitment of our hardworking colleagues at Aurora. I want to thank them for the great accomplishments they have made this year, for Aurora and ultimately, for patients. They have embraced change and risen to the numerous challenges before them, and I am grateful for their ongoing support of our company and our mission.

I would also like to thank you, our investors, for your continued support. Together, we have built a strong foundation, and I look forward to the opportunities ahead of us. I am truly grateful to be part of an organization that makes such a positive improvement in the lives of patients around the world.

The Financial Statements together with the Management Discussion and Analysis can be found on SEDAR at www.sedar.com.

Trent J. Northcutt
President and Chief Executive Officer

About Aurora Spine
Aurora Spine is focused on bringing new solutions to the spinal implant market through a series of innovative, minimally invasive, regenerative spinal implant technologies.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

For more information, please contact: