Increased market demand and new leasing model continue to generate significant sales growth
Recently signed contracts increased total minimum revenue projection by 21% over end of second quarter to record $23 million
HACKENSACK, N.J., Nov. 20, 2017 (GLOBE NEWSWIRE) -- Brainsway Ltd. (TASE:BRIN), a leader in the advanced non-invasive treatment of brain disorders, today announced the Company’s financial results for the third quarter ended September 30, 2017. The Company’s revenues for the third quarter of 2017 increased by 27% over the revenues in the second quarter of 2017. Additionally, based on minimum leasing fees (before usage fees) associated with current binding contractual agreements, the Company increased its total minimum revenue projection by 21% to a record of $23 million compared to $19.1 million at the end of second quarter 2017, and $15.0 million at the end of the first quarter. As of January 2017, Brainsway has adopted a new business model primarily focused on leasing its Deep Transcranial Magnetic Stimulation (TMS) systems to customers.
Lease-related revenues comprised approximately 63% of total revenues over the first nine months of 2017, as compared to 47% of total revenues for full-year 2016.
"We are very pleased with our strong financial results in the third quarter of 2017, which were driven primarily by increased market demand for the Deep TMS system and the implementation of our new leasing model,” said Yaacov Michlin, Brainsway CEO. “Our record quarterly revenues and strong backlog for the next several years indicate that the significant benefits of the Deep TMS system are well-recognized by our customers.”
"Brainsway has successfully implemented its strategic plan based on new leasing-based business model focused on four key objectives: meaningful revenue growth, consistent increase of the lease income backlog, decreased cash burn rate, and enhanced clinical development progress,” continued Mr. Yaacov Michlin. “Looking ahead to 2018, we hope to receive FDA clearance to begin commercializing our Deep TMS system for Obsessive-Compulsive Disorder (OCD) in the US, following our recently completed successful clinical trial and our launch of the OCD H7 coil in Europe. About one percent of the U.S. population are diagnosed with OCD each year and approximately half will not respond to other treatment alternatives. Therefore, once received, FDA clearance in this indication will provide new revenue growth opportunities for Brainsway.
"Brainsway has a large customer base, that either purchased the Deep TMS system or leased it for 3 to 5 years. The lease agreements boost the company's expected revenue potential, as reflected in an increase in the backlog growth and constant growth of revenue.
"As we prepare to begin our commercial launch, following FDA clearance, in the large OCD market, we remain firmly committed to the continued development of our unique proprietary technology and its application in additional neurological and psychiatric brain disorders. We anticipate the availability of the final results from our multicenter double-blind clinical trial evaluating our Deep TMS system in cessation of cigarette smoking before end of 2018. We managed to increase the pace of recruitment in this study and with the reduce of drop-outs we already have 135 completers out of 164 required completers. The smoking cessation study is our first in the addiction field and, if successful, it will allow us to move faster into additional relevant indications such as opioid addictions. Moreover, we anticipate the availability of the final results from our trials focused on treating Post-Traumatic Stress Disorder (PTSD) and Bi-polar disorder (manic depression) in 2019. We also aim to launch clinical studies in neurological indications in the next months. These are all substantial markets for Brainsway, and we believe that the growing global adoption of our innovative platform will allow us to maximize our business and competitive positioning for the long-term in the U.S. and additional markets,” concluded Mr. Michlin.
Brainsway is engaged in the research, development and marketing of a medical system for non-invasive treatment of common brain disorders. The medical system developed and manufactured by the company is based on a unique and breakthrough technology called Deep TMS, which can reach the depth of the brain and produce nerve stimulation or suppression. The company's systems are sold worldwide and have CE and FDA approvals and has reimbursement by insurers, [including both commercial and government payors] covering about 90% of the US population.
Chief Financial Officer