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Co-Diagnostics, Inc. Reports Third Quarter 2022 Financial Results

Nearing commencement of clinical evaluations for the Co-Dx PCR Home platform
COVID-19 test volumes continue to impact third quarter results

SALT LAKE CITY, Nov. 10, 2022 /PRNewswire/ -- Co-Diagnostics, Inc. (NASDAQ: CODX), a molecular diagnostics company with a unique, patented platform for the development of molecular diagnostic tests, announced today financial results for the third quarter ended September 30, 2022.

Third Quarter 2022 Financial Results:

  • Revenue of $5.1 million, down from $30.1 million during the prior year period, but an increase of 1.4% from the current year second quarter
  • Gross profit of $4.3 million, representing 84.9% of consolidated revenue
  • Operating loss of $6.5 million compared to operating income of $13.6 million a year ago, due to lower sales volumes and continued investments into research and development for the Co-Dx PCR Home Platform
  • Net loss of $1.4 million, compared to a net income of $11.5 million in the prior-year third quarter, representing a loss of $0.04 per fully diluted share
  • Adjusted EBITDA loss of $4.1 million
  • Repurchased 2.9 million shares during the third quarter at an average price of $3.61 per share
  • Cash, cash equivalents, and marketable securities of $86.5 million as of September 30, 2022
  • Cash flow from operations of $10.6 million for the nine months ended September 30, 2022, of which $1.1 million was generated in the third quarter

Dwight Egan, Co-Diagnostics' Chief Executive Officer, remarked, "While our third quarter results were impacted by lower demand for our COVID-19 test, we made significant progress on our Co-Dx PCR Home™ platform which is nearing its final stages. In addition to expecting clinical trials to begin in the very near future, our ability to generate positive cash flow from operations during the quarter supported further development and optimization efforts for our Co-Dx PCR Home platform. Our team remains driven by enhancing the platform so it becomes the new standard for PCR at-home and point-of-care testing, while also expanding our suite of tests for our clinical laboratory business segment."

Mr. Egan added, "I am proud of our team's focused execution. We remain confident in our strategy and our unique portfolio of innovative testing products which is further reflected by our team repurchasing almost 10% of shares outstanding during the quarter. Our patented CoPrimer™ technology and patent-pending design of the new Co-Dx PCR Home platform extend our capabilities, aspirations, and potential far beyond COVID-19 and together with our efficient operations will drive future value for our shareholders." 

Third Quarter 2022 and Recent Business Highlights:

  • Announced shipment of our Monekypox Virus Test
  • Announced expansion of our OEM Agreement with Bio Molecular Systems
  • Announced appointment of Dr. Mark Poritz as new Chief Scientific Officer

Conference Call and Webcast

Co-Diagnostics will host a conference call and webcast at 4:30 p.m. ET today to discuss its financial results with analysts and institutional investors. The conference call and webcast will be available via:

Webcast: ir.codiagnostics.com on the Events & Webcasts page

Conference Call: 877-317-6789 (domestic) or 412-317-6789 (international)

The call will be recorded and later made available on the Company's website: https://codiagnostics.com.

The Co-Dx PCR Home platform is subject to FDA review and is not currently for sale.

About Co-Diagnostics, Inc.:
Co-Diagnostics, Inc., a Utah corporation, is a molecular diagnostics company that develops, manufactures and markets state-of-the-art diagnostics technologies. The Company's technologies are utilized for tests that are designed using the detection and/or analysis of nucleic acid molecules (DNA or RNA). The Company also uses its proprietary technology to design specific tests to locate genetic markers for use in industries other than infectious disease and license the use of those tests to specific customers.

Non-GAAP Financial Measures:
This press release contains adjusted EBITDA, which is a non-GAAP measure defined as net income excluding depreciation, amortization, income tax (benefit) expense, net interest (income) expense, stock-based compensation, and one-time transaction related costs. The Company believes that adjusted EBITDA provides useful information to management and investors relating to its results of operations. The Company's management uses this non-GAAP measure to compare the Company's performance to that of prior periods for trend analyses, and for budgeting and planning purposes. The Company believes that the use of adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company's financial measures with other companies, many of which present similar non-GAAP financial measures to investors, and that it allows for greater transparency with respect to key metrics used by management in its financial and operational decision-making.

Management does not consider the non-GAAP measure in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of the non-GAAP financial measure is that it excludes significant expenses that are required by GAAP to be recorded in the Company's financial statements. In order to compensate for these limitations, management presents the non-GAAP financial measure together with GAAP results. Non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for, or superior to, GAAP results. A reconciliation tables of the net income, the most comparable GAAP financial measure to adjusted EBITDA, is included at the end of this release. The Company urges investors to review the reconciliation and not to rely on any single financial measure to evaluate the company's business.

Forward-Looking Statements:
This press release contains forward-looking statements. Forward-looking statements can be identified by words such as "believes," "expects," "estimates," "intends," "may," "plans," "will" and similar expressions, or the negative of these words. Such forward-looking statements are based on facts and conditions as they exist at the time such statements are made and predictions as to future facts and conditions. Forward-looking statements in this release include statements regarding initiation of clinical trials. completion of development and FDA submission for approval of the new Co-Dx at-home/point-of-care PCR testing device. . Forward-looking statements are subject to inherent uncertainties, risks and changes in circumstances. Actual results may differ materially from those contemplated or anticipated by such forward-looking statements. Readers of this press release are cautioned not to place undue reliance on any forward-looking statements. There can be no assurance that any of the anticipated results will occur on a timely basis or at all due to certain risks and uncertainties, a discussion of which can be found in our Risk Factors disclosure in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission (SEC) on March 24, 2022, and in our other filings with the SEC. The Company does not undertake any obligation to update any forward-looking statement relating to matters discussed in this press release, except as may be required by applicable securities laws.

 

CO-DIAGNOSTICS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)






September 30, 2022



December 31, 2021


Assets









Current assets









Cash and cash equivalents


$

81,507,983



$

88,607,234


Marketable investment securities



4,982,350




1,255,266


Accounts receivable, net



7,961,664




20,839,182


Inventory



5,441,726




2,004,169


Income taxes receivable



705,849




-


Prepaid expenses and other current assets



1,241,143




2,338,444


Note receivable



75,000




75,000


Total current assets



101,915,715




115,119,295


Property and equipment, net



2,438,112




1,933,216


Operating lease right-of-use asset



456,251




-


Goodwill



15,388,546




14,706,818


Intangible assets, net



26,875,000




27,195,000


Investment in joint venture



748,737




1,004,953


Note receivable



18,750




75,000


Total assets


$

147,841,111



$

160,034,282


Liabilities and stockholders' equity









Current liabilities









Accounts payable


$

2,055,889



$

607,506


Accrued expenses, current



1,511,720




3,859,652


Operating lease liability, current



292,536




-


Contingent consideration liabilities, current



2,152,064




5,767,304


Income taxes payable



-




2,213,088


Deferred revenue



-




150,000


Total current liabilities



6,012,209




12,597,550


Long-term liabilities









Income taxes payable



1,559,557




1,067,853


Deferred tax liability



3,797,158




7,228,444


Operating lease liability



126,280




-


Contingent consideration liabilities



1,400,490




4,665,337


Total long-term liabilities



6,883,485




12,961,634


Total liabilities



12,895,694




25,559,184


Commitments and contingencies (Note 12)









Stockholders' equity









Convertible preferred stock, $0.001 par value; 5,000,000 shares authorized; 0 shares
issued and outstanding as of September 30, 2022 and December 31, 2021, respectively



-




-


Common stock, $0.001 par value; 100,000,000 shares authorized; 34,332,182 shares
issued and 30,917,856 shares outstanding as of September 30, 2022 and 33,819,862
shares issued and outstanding as of December 31, 2021



34,332




33,820


Treasury stock, at cost; 3,414,326 and 0 shares held as of September 30, 2022 and
December 31, 2021, respectively



(12,994,373)




-


Additional paid-in capital



86,068,948




80,271,999


Accumulated earnings



61,836,510




54,169,279


Total stockholders' equity



134,945,417




134,475,098


Total liabilities and stockholders' equity


$

147,841,111



$

160,034,282


 

CO-DIAGNOSTICS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)






Three Months Ended September 30,



Nine Months Ended September 30,




2022



2021



2022



2021


Revenue


$

5,094,456



$

30,101,353



$

32,816,726



$

77,484,262


Cost of revenue



767,936




3,311,255




4,965,319




9,088,175


Gross profit



4,326,520




26,790,098




27,851,407




68,396,087


Operating expenses

















Sales and marketing



1,889,907




4,253,091




6,014,280




11,303,950


General and administrative



3,622,273




2,919,498




9,012,888




8,323,620


Research and development



5,037,461




5,893,350




12,698,632




12,779,573


Depreciation and amortization



312,494




94,038




984,100




232,757


Total operating expenses



10,862,135




13,159,977




28,709,900




32,639,900


Income (loss) from operations



(6,535,615)




13,630,121




(858,493)




35,756,187


Other income (expense)

















Interest income



298,184




11,379




371,248




36,565


Gain (loss) on disposition of assets



4,044




-




(138,117)




-


Gain on remeasurement of acquisition contingencies



2,886,734




-




7,079,446




-


Loss on equity method investment in joint venture



(129,047)




(64,940)




(256,911)




(401,288)


Total other income (expense)



3,059,915




(53,561)




7,055,666




(364,723)


Income (loss) before income taxes



(3,475,700)




13,576,560




6,197,173




35,391,464


Income tax provision (benefit)



(2,114,638)




2,100,594




(1,470,058)




6,231,310


Net income (loss)


$

(1,361,062)



$

11,475,966



$

7,667,231



$

29,160,154


Earnings per common share:

















Basic


$

(0.04)



$

0.40



$

0.24



$

1.01


Diluted


$

(0.04)



$

0.38



$

0.23



$

0.98


Weighted average shares outstanding:

















Basic



31,321,368




28,941,357




32,109,213




28,800,450


Diluted



31,321,368




29,952,690




33,002,539




29,872,415


 

CO-DIAGNOSTICS, INC. AND SUBSIDIARIES

GAAP AND NON-GAAP MEASURES

(Unaudited)

 


Reconciliation of net income to adjusted EBITDA:








Three Months Ended September 30,



Nine Months Ended September 30,




2022



2021



2022



2021


Net income


$

(1,361,062)



$

11,475,966



$

7,667,231



$

29,160,154


Interest income



(298,184)




(11,379)




(371,248)




(36,565)


Depreciation and amortization



312,494




94,038




984,100




232,757


Transaction costs



13,038




-




139,209




-


Change in fair value of contingent consideration



(2,886,734)




-




(7,079,446)




-


Stock-based compensation expense



2,230,434




1,410,944




5,138,815




3,851,293


Income tax provision



(2,114,638)




2,100,594




(1,470,058)




6,231,310


Adjusted EBITDA


$

(4,104,652)



$

15,070,163



$

5,008,603



$

39,438,949


 

SOURCE Co-Diagnostics

For further information: Company Contact: Andrew Benson, Head of Investor Relations, +1 801-438-1036, investors@codiagnostics.com, or Investor Relations Contact: Zachary Mizener, Lambert & Co., +1 616-233-0500, zmizener@lambert.com

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