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Co-Diagnostics, Inc. Reports Second Quarter 2023 Financial Results

Co-Dx receives grant awards from the Bill & Melinda Gates Foundation; NIH RADx® Tech to develop tests on our new Co-Dx PCR Home™ platform

SALT LAKE CITY, Aug. 10, 2023 /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 quarter ended June 30, 2023.

Second Quarter 2023 Financial Results:

  • Revenue of $0.2 million, down from $5.0 million during the prior year primarily due to the anticipated decline in global demand for the Logix Smart® COVID-19 tests
  • Operating expenses of $11.7 million increased by 42.1% from the prior year same period due to our pre-commercialization investments in our Co-Dx PCR Home platform*
  • Operating loss of $12.0 million compared to operating loss of $4.1 million a year ago
  • Net loss of $8.9 million, compared to net loss of $2.7 million in the prior year second quarter, representing EPS loss of $0.31 per fully diluted share, compared to EPS loss of $0.08 in the prior year period
  • Adjusted EBITDA loss of $9.6 million
  • Repurchased 0.4 million shares of common stock at an average price of $1.51 per share for an aggregate purchase price of approximately $0.6 million
  • Cash, cash equivalents, and marketable securities of $69.1 million as of June 30, 2023

2023 Recent Business Highlights:

  • NIH awarded the Company $1.2 million as part of the Rapid Acceleration of Diagnostics (RADx®) Tech program for completion of its upcoming upper respiratory panel on the Company's Co-Dx PCR Home testing platform
  • The company was awarded two grants by the Bill & Melinda Gates Foundation in the amounts of $1.33 million and $987K, to support the development of TB and HPV tests, respectively
  • Signed lease and began build-out of new manufacturing facility with capacity for up to 12 lines of production; first lines expected to be operational by end of 2023
  • Received results from a recent usability and analytical study conducted by PATH, which investigated the limit-of-detection and ease-of-use of the Company's Co-Dx PCR Home platform, running the platform's COVID-19 assay

Dwight Egan, Co-Diagnostics' Chief Executive Officer, said, "While sales of our COVID diagnostic kits declined as expected, we continue to strengthen our position as we seek to expand our advanced PCR technology reach beyond the four walls of the lab to the places of greatest unmet need. We remain on track for FDA submission of our new Co-Dx PCR Home platform and initial testing product by the end of this year."

"We remain steadfast in our strategy and continue to progress toward our mission of making affordable, high-quality real-time PCR diagnostics available to all," said Brian Brown, Co-Diagnostics' Chief Financial Officer. "We are making notable progress toward our goals and move into the second half of this year with strong momentum."

Conference Call and Webcast

Co-Diagnostics will host a conference call and webcast at 4:30 p.m. EDT 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: 844-481-2661 (domestic) or 412-317-0652 (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 for its Co-Dx PCR Home™ platform and to locate genetic markers for use in applications other than infectious disease.

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 table 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 (i) completion of development and FDA submission for approval of the Co-Dx PCR Home platform by end of this year and (ii) 12 lines of production with first lines expected to be operational by end of 2023. 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 16, 2023, 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)






June 30, 2023



December 31, 2022


Assets







Current assets









Cash and cash equivalents


$

13,830,846



$

22,973,803


Marketable investment securities



55,307,146




58,289,066


Accounts receivable, net



1,097,393




3,453,723


Inventory, net



4,691,068




5,310,473


Income taxes receivable



1,439,451




1,870,419


Prepaid expenses and other current assets



981,996




761,187


Note receivable



37,500




75,000


Total current assets



77,385,400




92,733,671


Property and equipment, net



2,795,023




2,539,483


Deferred tax asset



2,012,181




-


Operating lease right-of-use asset



3,228,774




372,115


Intangible assets, net



26,555,000




26,768,333


Investment in joint venture



824,808




672,679


Total assets


$

112,801,186



$

123,086,281


Liabilities and stockholders' equity









Current liabilities









Accounts payable


$

1,712,204



$

952,296


Accrued expenses, current



1,628,765




934,447


Operating lease liability, current



772,515




297,209


Contingent consideration liabilities, current



744,172




1,689,471


Deferred revenue



257,999




-


Total current liabilities



5,115,655




3,873,423


Long-term liabilities









Income taxes payable



1,203,975




1,181,284


Deferred tax liability



-




2,417,987


Operating lease liability



2,458,072




50,708


Contingent consideration liabilities



591,107




1,042,885


Total long-term liabilities



4,253,154




4,692,864


Total liabilities



9,368,810




8,566,287


Commitments and contingencies (Note 10)









Stockholders' equity









Convertible preferred stock, $0.001 par value; 5,000,000 shares

authorized; 0 shares issued and outstanding as of June 30, 2023 and

December 31, 2022, respectively



-




-


Common stock, $0.001 par value; 100,000,000 shares authorized;

35,348,350 shares issued and 30,788,871 shares outstanding as of

June 30, 2023 and 34,754,265 shares issued and 30,872,607 shares

outstanding as of December 31, 2022



35,348




34,754


Treasury stock, at cost; 4,559,479 and 3,881,658 shares held as of

June 30, 2023 and December 31, 2022, respectively



(15,249,796)




(14,211,866)


Additional paid-in capital



92,810,883




88,472,935


Accumulated other comprehensive income



579,127




293,140


Accumulated earnings



25,256,815




39,931,031


Total stockholders' equity



103,432,377




114,519,994


Total liabilities and stockholders' equity


$

112,801,186



$

123,086,281


 

CO-DIAGNOSTICS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited)




Three Months Ended June 30,


Six Months Ended June 30,



2023



2022



2023



2022


Revenue


$

197,806



$

5,023,226



$

799,763



$

27,722,270


Cost of revenue



459,095




915,432




961,336




4,197,383


Gross profit



(261,289)




4,107,794




(161,573)




23,524,887


Operating expenses

















Sales and marketing



1,732,966




1,472,225




3,439,297




4,124,373


General and administrative



3,713,895




2,468,421




6,727,860




5,390,616


Research and development



5,981,043




3,889,844




10,995,103




7,661,171


Depreciation and amortization



305,246




424,342




621,256




671,606


Total operating expenses



11,733,150




8,254,832




21,783,516




17,847,766


Income (loss) from operations



(11,994,439)




(4,147,038)




(21,945,089)




5,677,121


Other income

















Interest income



191,892




61,671




394,264




73,064


Realized gain on investments



411,190




-




829,272




-


(Loss) on disposition of assets



-




(48,740)




-




(142,161)


Gain on remeasurement of acquisition contingencies



359,405




812,822




1,397,077




4,192,712


Gain (loss) on equity method investment in joint venture



(125,193)




(106,525)




152,129




(127,864)


Total other income



837,294




719,228




2,772,742




3,995,751


Income (loss) before income taxes



(11,157,145)




(3,427,810)




(19,172,347)




9,672,872


Income tax provision (benefit)



(2,238,320)




(741,507)




(4,498,131)




644,580


Net income (loss)


$

(8,918,825)



$

(2,686,303)



$

(14,674,216)



$

9,028,292


Other comprehensive income (loss)

















Change in net unrealized gains on marketable securities, net of tax


$

107,366



$

-



$

285,987



$

-


Total other comprehensive income


$

107,366



$

-



$

285,987



$

-


Comprehensive income (loss)


$

(8,811,459)



$

(2,686,303)



$

(14,388,229)



$

9,028,292



















Earnings per common share:

















Basic


$

(0.31)



$

(0.08)



$

(0.50)



$

0.28


Diluted


$

(0.31)



$

(0.08)



$

(0.50)



$

0.27


Weighted average shares outstanding:

















Basic



29,088,159




32,472,251




29,284,175




32,509,664


Diluted



29,088,159




32,472,251




29,284,175




33,253,612


 

CO-DIAGNOSTICS, INC. AND SUBSIDIARIES

GAAP AND NON-GAAP MEASURES

(Unaudited)

 




Reconciliation of net income to adjusted EBITDA:















Three Months Ended June 30,


 Six Months Ended June 30,




2023


2022



2023



2022


Net income (loss)


$

(8,918,825)



$

(2,686,303)



$

(14,674,216)



$

9,028,292


Interest income



(191,892)




(61,671)




(394,264)




(73,064)


Realized gain on investments



(411,190)




-




(829,272)




-


Depreciation and amortization



305,246




424,342




621,256




671,606


Transaction costs



310




47,943




310




126,171


Change in fair value of contingent consideration



(359,405)




(812,822)




(1,397,077)




(4,192,712)


Stock-based compensation expense



2,169,800




1,533,286




4,338,542




2,908,381


Income tax provision



(2,238,320)




(741,507)




(4,498,131)




644,580


Adjusted EBITDA


$

(9,644,276)



$

(2,296,732)



$

(16,832,852)



$

9,113,254


 

SOURCE Co-Diagnostics

For further information: Investor Relations, Andrew Benson, Head of Investor Relations, +1 801-438-1036, investors@codiagnostics.com

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