SpineGuard Announces Its Full-Year 2023 Financial Results and Its First Quarter 2024 Sales - Seite 3

In the rest of the world, sales rose by +22% for products over the full year, thanks to strong growth in Europe and Latin America, and a major order in China from XinRong Medical Group, SpineGuard's local partner.

Besides, overall sales were negatively impacted by the discontinuation of royalty income relating to the dental project, following the decision by the Adin Dental Implant Systems Group to halt developments, for its own financial reasons, at the end of the first quarter of 2023.

The gross margin rate for 2023 sets at 78.3%, compared with 84.2% in 2022. This decline is mainly due to the discontinuation of royalty income from the dental project and the decline in US sales, where gross margins are higher than in the rest of the world.

Current operating expenses rose by 16.9%, i.e. €1,058 K, reflecting the financial impact of sales and marketing investments, particularly in the United States, and ongoing R&D innovation.

Non-current expenses amounted to €57 K at December 31, 2023, compared with €135 K at December 31, 2022, and correspond mainly to restructuring costs in the United States.

Operating profit before non-recurring items therefore came to -€3,919 K, at December 31, 2023, compared with -€1,526 K at December 31, 2022.

Net financial expense, at -€225 K, mainly reflects interest payments on debts contracted with Norgine Venture, Harbert European Growth and Bpifrance, and net foreign exchange losses of -€70 K, offsetting income from investments (term accounts) of €45 K, as well as changes in the derivative liability, with no impact on cash, of €213 K.

After taking these items into account, net income would be -€4,183 K in 2023, compared with -€2,393 K in 2022.

Operating working capital stood at €540 K at December 31, 2023, compared with €452 K at December 31, 2022.

Cash and cash equivalents (shown under current financial assets) at December 31, 2023 came to €3,893 K, compared with €4,115 K at December 31, 2022. This change in cash and cash equivalents is mainly due to:

• Cash flow from operations deteriorated to -€3,545 K in 2023 from -€889 K in 2022, and cash used to finance operations increased by €2,247 K to -€3,649 K in 2023, versus -€1,402 K in 2022;
• The change in working capital requirements, which deteriorated by €104 K in 2023, compared with a deterioration of €513 K in 2022, mainly due to the increase in inventories linked to the reduction in US sales, and the increase in prices linked to the unfavorable USD/EURO exchange rate and the impact of the increase in the price of electronic components;
• Partial repayment of principal on bonds taken out with Norgine Venture and Harbert European Growth for €761 K;
• Repayment of principal on the Bpifrance loan in the amount of €49 K;
• Payment of interest on bonds subscribed with Norgine Venture and Harbert European Growth in the amount of €226 K; and
• Equity contributions following drawdowns on the equity financing line (redeemable equity warrants – “BSAR”) for a total gross amount of €3 M and the capital increases carried out in July and December 2023 for a total gross amount of €2 M.

The Company benefits from a repayable advance under COFACE contracts (prospecting insurance) for China. No repayments have been made in respect of the fifth year of amortization of this advance.