Bay Street News

BrainsWay Reports Fourth Quarter and Full-Year 2023 Financial Results and Operational Highlights

Generated Record Revenues with Robust 50% Year-over-Year Revenue Growth in Q4 2023; 
Generated Positive Quarterly Net Income

Providing Full-Year 2024 Revenue Guidance of $37-$40 Million with Continued Profitability Momentum and Cash Generation

Conference Call to be Held Today at 8:30 AM ET

BURLINGTON, Mass. and JERUSALEM, March 06, 2024 (GLOBE NEWSWIRE) — BrainsWay Ltd. (NASDAQ & TASE: BWAY) (“BrainsWay” or the “Company”), a world leader in advanced and non-invasive treatment for brain disorders, today reported fourth quarter and full-year 2023 financial results and provided an operational update.

Recent Financial and Operational Highlights

“Our annual 2023 revenues of $31.8 million represented an increase of 17% over full-year 2022, reflecting the strong and growing demand for our innovative Deep TMS technology,” said Hadar Levy, BrainsWay’s Chief Executive Officer. “In the fourth quarter we generated positive net income, and for the second consecutive quarter, recorded positive Adjusted EBITDA1 and positive cash flow from operations.”

“Based on our strong performance in 2023, and our belief that this trend will continue, we anticipate that our profitability momentum and positive cash generation will continue throughout this year. We expect that annual revenues in 2024 will be in the range of $37 to $40 million, representing growth of between 16% and 26% over 2023,” continued Mr. Levy. “Our robust sales pipeline, continued traction with large networks, international momentum and launch of several new studies aiming to further expand our total addressable market all continue to position BrainsWay as the leading innovative force in the TMS industry,” concluded Mr. Levy.

Conference Call and Webcast

BrainsWay’s management will host a conference call on Wednesday, March 6, 2024, at 8:30 a.m. Eastern Time to discuss these results and answer questions.

Wednesday, March 6, 2024, at 8:30 AM Eastern Time:

The conference call will be broadcast live and will be available for replay for 30 days on the Company’s website, https://investors.brainsway.com/events-and-presentations/event-calendar. Please access the Company’s website at least 10 minutes ahead of the conference call to register.

_______________________

1 See Adjusted EBITDA details and reconciliation table in the appendix below.

Non-IFRS Financial Measures
In addition to our results determined in accordance with International Financial Reporting Standards (IFRS), including in particular operating income and net income, we believe that Adjusted EBITDA, a non-IFRS measure, is useful in evaluating our operating performance. We define Adjusted EBITDA as net income adjusted for depreciation and amortization, finance income, finance expenses, income taxes, cost of share-based payments, and one-time restructuring and litigation expenses.

In addition to operating income (loss) and net income (loss), we use Adjusted EBITDA as a measure of operational efficiency. We believe that this non-IFRS financial measure is useful to investors for period-to-period comparisons of our business and in understanding and evaluating our operating results for the following reasons:

Adjusted EBITDA, however, should not be considered as an alternative to operating income (loss) or net income (loss) for the period and may not be indicative of the historic operating results of the Company; nor is it meant to be predictive of potential future results. Adjusted EBITDA is not a measure of financial performance under IFRS and may not be comparable to other similarly titled measures for other companies. A reconciliation between the Company’s net income (loss) and Adjusted EBITDA is presented in the attached summary financial statements.

Because of these and other limitations, you should consider Adjusted EBITDA along with other IFRS-based financial performance measures, including net income (loss) and our IFRS financial results.

About BrainsWay
BrainsWay is a global leader in advanced noninvasive neurostimulation treatments for mental health disorders. The Company is boldly advancing neuroscience with its proprietary Deep Transcranial Magnetic Stimulation (Deep TMS™) platform technology to improve health and transform lives. BrainsWay is the first and only TMS company to obtain three FDA-cleared indications backed by pivotal clinical studies demonstrating clinically proven efficacy. Current indications include major depressive disorder (including reduction of anxiety symptoms, commonly referred to as anxious depression), obsessive-compulsive disorder, and smoking addiction. The Company is dedicated to leading through superior science and building on its unparalleled body of clinical evidence. Additional clinical trials of Deep TMS in various psychiatric, neurological, and addiction disorders are underway. Founded in 2003, with offices in Burlington, MA and Jerusalem, Israel, BrainsWay is committed to increasing global awareness of and broad access to Deep TMS. For the latest news and information about BrainsWay, please visit www.brainsway.com.

Forward-Looking Statement
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential” or similar words. These forward-looking statements and their implications are based on the current expectations of the management of the Company only and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. In addition, historical results or conclusions from scientific research and clinical studies do not guarantee that the FDA will clear additional indications or expand existing indications, or that future results would suggest similar conclusions or that historical results referred to herein would be interpreted similarly in light of additional research or otherwise. The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: inadequacy of financial resources to meet future capital requirements; changes in technology and market requirements; delays or obstacles in launching and/or successfully completing planned studies and clinical trials; failure to obtain approvals by regulatory agencies on the Company’s anticipated timeframe, or at all; inability to retain or attract key employees whose knowledge is essential to the development of Deep TMS products; unforeseen difficulties with Deep TMS products and processes, and/or inability to develop necessary enhancements; unexpected costs related to Deep TMS products; failure to obtain and maintain adequate protection of the Company’s intellectual property, including intellectual property licensed to the Company; the potential for product liability; changes in legislation and applicable rules and regulations; unfavorable market perception and acceptance of Deep TMS technology; inadequate or delays in reimbursement from third-party payers, including insurance companies and Medicare; inability to commercialize Deep TMS, including internationally, by the Company or through third-party distributors; product development by competitors; inability to timely develop and introduce new technologies, products and applications, which could cause the actual results or performance of the Company to differ materially from those contemplated in such forward-looking statements.

Any forward-looking statement in this press release speaks only as of the date of this press release. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as may be required by any applicable securities laws. More detailed information about the risks and uncertainties affecting the Company is contained under the heading “Risk Factors” in the Company’s filings with the U.S. Securities and Exchange Commission.

Contacts:

BrainsWay:
Ido Marom
Chief Financial Officer
844-386-7001 ext. 5
Ido.Marom@BrainsWay.com

Investors:
Brian Ritchie
LifeSci Advisors
212-915-2578
britchie@lifesciadvisors.com

BRAINSWAY LTD. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION  
U.S. dollars in thousands  
           
    December 31,   December 31,  
     2023     2022   
ASSETS   (Unaudited)   (Audited)  
Current Assets          
Cash and cash equivalents   $ 10,520     $ 47,581    
Short-term deposits     35,465          
Restricted cash     271       271    
Trade receivables, net     3,780       4,844    
Inventory     3,717       3,837    
Other current assets     1,712       1,556    
      55,465       58,089    
Non-Current Assets          
System components     1,273       1,220    
Leased systems, net     3,700       3,118    
Other property and equipment     817       1,008    
Other long-term assets     1,717       1,042    
      7,507       6,388    
    $ 62,972     $ 64,477    
           
LIABILITIES AND EQUITY          
Current Liabilities          
Trade payables   $ 758     $ 1,116    
Deferred revenues     2,504       1,477    
Liability in respect of research and development grants     1,008       1,057    
Other accounts payable     5,491       4,491    
      9,761       8,141    
Non-Current Liabilities          
Deferred revenues and other liabilities     5,553       4,923    
Liability in respect of research and development grants     6,077       6,016    
      11,630       10,939    
           
Equity          
Share capital     367       364    
Share premium     140,344       138,146    
Share-based payment reserve     4,360       6,180    
Currency Translation Adjustments     (2,188 )     (2,188 )  
Accumulated deficit     (101,302 )     (97,105 )  
      41,581       45,397    
           
    $ 62,972     $ 64,477    
           
BRAINSWAY LTD. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS  
U.S. dollars in thousands (except per share data)  
                   
    For the three months ended
December 31,
  Year ended
December 31,
 
    2023    2022    2023    2022   
    (Unaudited)   (Unaudited)   (Audited)  
Revenues   $ 9,029     $ 6,033     $ 31,785     $ 27,177    
Cost of revenues     2,290       1,729       8,308       7,129    
Gross profit     6,739       4,304       23,477       20,048    
                   
                   
Research and development expenses, net     1,434       2,151       6,665       7,678    
Selling and marketing expenses     3,959       4,750       16,456       18,199    
General and administrative expenses     1,162       1,726       5,315       6,854    
Total operating expenses     6,555       8,627       28,436       32,731    
                   
Operating profit (loss)     184       (4,323 )     (4,959 )     (12,683 )  
                   
Finance income (expense), net     (221 )     401       1,013       (351 )  
Loss before income taxes     (37 )     (3,922 )     (3,946 )     (13,034 )  
Taxes on income     (164 )     (55 )     251       315    
Net income (loss) and total comprehensive income (loss)   $ 127     $ (3,867 )     (4,197 )     (13,349 )  
                   
Basic and diluted net income (loss) per share   $ 0.00     $ (0.12 )   $ (0.13 )   $ (0.40 )  
                   
                   
BRAINSWAY LTD. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF CASH FLOWS  
U.S. dollars in thousands  
                   
    For the three months ended
December 31,
  For the year ended
December 31,
 
     2023     2022     2023     2022   
    (Unaudited)   (Unaudited)   (Audited)  
Cash flows from operating activities:                  
Total comprehensive income (loss)   $ 127     $ (3,867 )   $ (4,197 )   $ (13,349 )  
Adjustments to reconcile net loss to net cash used in operating activities:                  
Adjustments to profit or loss items:                  
Depreciation and amortization     83       101       362       558    
Depreciation of leased systems     256       241       975       976    
Impairments and disposals     509       400       1,447       816    
Finance expenses, net     221       (401 )     (1,013 )     351    
Cost of share based payment     234       353       381       1,474    
Income taxes     (164 )     (55 )     251       315    
Total adjustments to reconcile loss     1,139       639       2,403       4,490    
Changes in asset and liability items:                  
Decrease (increase) in trade receivables     (315 )     821       1,089       1,456    
Increase in inventory     (500 )     (643 )     (506 )     (3,595 )  
Decrease (increase) in other accounts receivable     (69 )     255       (312 )     (403 )  
Increase (decrease) in trade payables     312       (169 )     (327 )        
Increase in other accounts payable     645       731       289       298    
Increase (decrease) in deferred revenues and other liabilities     1,164       (313 )     1,402       790    
Total changes in asset and liability     1,237       682       1,635       (1,454 )  
Cash paid and received during the period for:                  
Interest paid     (150 )     (12 )     (253 )     (46 )  
Interest received     121       422       1,707       1,042    
Income taxes paid           (107 )     (11 )     (443 )  
Total cash paid and received during the period     (29 )     303       1,443       553    
Net cash provided by (used in) operating activities:     2,474       (2,243 )     1,284       (9,760 )  
                   
Cash flows from investing activities:                  
Proceeds from (purchase of) property and equipment and system components, net     (442 )     428       (2,387 )     1,936    
Withdrawal of (investment in) short-term deposits, net     (35,000 )           (35,000 )     40,254    
Investment in long-term deposits, net     (14 )     (1 )     (22 )     (21 )  
Net cash provided by (used in) investing activities     (35,456 )     427       (37,409 )     42,169    
                   
Cash flows from financing activities:                  
Repayment of liability in respect of research and development grants     (442 )           (787 )     (977 )  
Receipt of government grants                 32       15    
Repayment of lease liability     (85 )     (73 )     (271 )     (533 )  
Issuance of share capital, net                       (52 )  
Net cash used in financing activities     (527 )     (73 )     (1,026 )     (1,547 )  
Exchange rate differences on cash and cash equivalents     136       118       90       (202 )  
                   
Increase (decrease) in cash and cash equivalents     (33,373 )     (1,771 )     (37,061 )     30,660    
Cash and cash equivalents at the beginning of the period     44,164       49,623       47,852       17,192    
Cash and cash equivalents at the end of the period   $ 10,791     $ 47,852     $ 10,791     $ 47,852    
                   
(a) Significant non cash transactions:                  
Recognition of new lease liability and right-of-use     101       61       308       301    
Termination of lease liability and right-of-use     29             99          
                   
BRAINSWAY LTD.  
A reconciliation of Adjusted EBITDA to net loss, the most directly comparable IFRS measure, is set forth below:  
U.S. dollars in thousands (except share and per share data)  
                   
    For the three months ended
December 31,
  For the year ended
December 31,
 
    2023    2022    2023    2022   
    (Unaudited)   (Unaudited)   (Audited)  
Net income (loss) and total comprehensive income (loss)   $ 127     $ (3,867 )   $ (4,197 )   $ (13,349 )  
                   
Finance (income) expense, net     221       (401 )     (1,013 )     351    
Income taxes     (164 )     (55 )     251       315    
Depreciation and amortization     83       101       362       558    
Depreciation of leased systems     256       241       975       976    
Cost of share based payment     234       353       381       1,474    
Restructuring and litigation Cost                 852          
Adjusted EBITDA   $ 757     $ (3,628 )   $ (2,389 )   $ (9,675 )  
                   


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