OPSENS ANNOUNCES A THIRD CONSECUTIVE QUARTER OF RECORD REVENUES FOR THIRD QUARTER FISCAL 2023

Total Revenue up 31% - Medical Sales up 36% - Gross Margin up 780 basis points

Conference call on the results today at 11:00 a.m. ET

QUEBEC CITY, July 13, 2023 /CNW/ - OpSens Inc. ("OpSens" or the "Company") (TSX: OPS) (OTCQX: OPSSF), a medical device cardiology-focused company delivering innovative solutions based on its proprietary optical technology, today reported its results for the third quarter of fiscal year 2023, ended May 31, 2023.

Third Quarter Fiscal 2023 Financial Highlights

• Consolidated revenues of $13.2 million, compared with $10.1 million in the third quarter of 2022, a 31% increase and a new quarterly record for the third consecutive quarter.
• Gross margin improved to 58.8% in the third quarter of 2023, an increase of 780 basis points compared with 51% in the third quarter of 2022.
• Record sales in Coronary Artery Disease of $6.8 million, representing a 21% sequential increase in sales as compared to the second quarter of 2023.
• Structural Heart sales of $0.8 million in the third quarter of 2023, driven by a 64% sequential increase in sales as compared to the second quarter of 2023.
• Sales of Optical Medical Products were $4.9 million, an increase of 92%, compared with $2.6 million in the third quarter of 2022.
• Cash and cash equivalents of $20.5 million at May 31, 2023 ($21.9 million at 28 February, 2023).

Management Commentary 

"We are pleased with the results of the quarter, which reflect a third consecutive record of quarterly revenues. We delivered growth in all three key categories of our medical segment, including the OptoWire for coronary artery disease, optical medical products, and the SavvyWire solution for structural heart TAVR procedures, which combined to drive 36% growth in revenue," said Louis Laflamme, President and CEO of OpSens.

"Our commercial sales team continues to increase adoption of both OptoWire and SavvyWire through a synergistic, multi-pronged approach which utilizes direct field sales representatives, distribution partners, and group purchasing agreements, all of which contributed to this record quarter. With a thoughtful and well executed roll out strategy of SavvyWire well underway resulting in 64% sequential product growth during the quarter, coupled with enhanced growth within our more established OptoWire product, I believe we are well positioned to continue growing OpSens in the years to come," Mr. Laflamme concluded.

Segmented Revenues Information

($ in Millions Canadian)	Three-month period ended May 31, 2023		Three-month period ended May 31, 2022		Nine-month period ended May 31, 2023		Nine-month  period ended May 31, 2022
Medical segment
Coronary Artery Disease	6.8		6.6		17.7		16.1
Structural Heart	0.8		-		1.6		-
Optical Medical Products	4.9		2.6		12.0		7.3
Other	-		-		0.3		0.3
Total Medical Revenues	12.5		9.2		31.6		23.7
Industrial	0.7		0.9		2.6		2.6
Total Revenues	13.2		10.1		34.2		26.3

Financial Commentary

Consolidated revenues were $13.2 million in the third quarter of 2023, a 31% increase, compared with the $10.1 million recorded in the third quarter of 2022. 

Coronary Artery Disease

Sales of coronary artery disease products (Fractional Flow Reserve ("FFR") and diastolic pressure ratio ("dPR")) were $6.8 million in the third quarter of 2023, compared with $6.6 million in the third quarter of 2022, an increase of 4%. OptoWire sales in the U.S. contributed to enhanced performance with a 31% increase. For EMEA, a market served through distributors, there has been 2% growth while Asia Pacific, a market also served through distributors has seen a 14% decrease due to some headwinds including currency exchange rates.

Structural Heart

Structural heart sales were $0.8 million in the third quarter of 2023, driven by a 64% sequential increase in sales as compared with the second quarter of 2023. The Company continues to execute its systematic, step-by-step, commercialization plan. The Company is finalizing plans to move from a controlled market release to a full market release in our last quarter of the fiscal year 2023.

Optical Medical Products

Sales of optical medical products, including the Company's multi-year supply contract of sensors for ventricular assist devices, were $4.9 million in the third quarter of 2023, compared with $2.6 million in the third quarter of 2022, an increase of 92%. The Company is seeing increased demand for its sensors with expectations for continued growth in the future.

Industrial

Industrial sales were at $0.7 million in the third quarter of 2023, compared with $0.9 million in the third quarter of 2022. During the quarter, the Company delivered solutions in optical temperature, pressure, strain, and other critical parameters for various industries, including aerospace, nuclear and power electronics.

Gross Margin

Gross margin improved to 58.8%, an increase of 780 basis points, compared to 51.0% during the prior year period. The increase was driven by favorable product mix, a higher weighting of direct sales to hospitals and higher sales volume.

Operating Expenses

Operating expenses in the third quarter of 2023 were $11.8 million, compared with $7.8 million in the third quarter of 2022. The $3.9 million increase was primarily due to an increase in Sales and Marketing activities, including an increase in the Company's direct U.S. sales force to enable the launch of SavvyWire. Research and Development expenditure increased due to structural heart and coronary artery projects.

Net Loss

Net loss for the third quarter of fiscal 2023 was $(4.2) million, or $(0.04) per diluted share, compared to a net loss of $(2.9) million, or $(0.03) per diluted share in the third quarter of fiscal 2022.

Balance Sheet

OpSens had a cash position of $20.5 million, as of May 31, 2023 (February 28, 2023, was $21.9 million).

Table A

(In thousands of Canadian dollars, except for information per share)	Three-month period ended May 31, 2023	Three-month period ended May 31, 2022	Nine-month period ended May 31, 2023	Nine-month period ended May 31, 2022
	$	$	$	$
Revenues
Sales
Medical	12,516	9,170	31,240	23,478
Industrial	681	874	2,581	2,596
	13,197	10,044	33,821	26,074
Other	(42)	32	336	197
	13,155	10,076	34,157	26,271
Cost of sales	5,421	4,938	14,406	12,846
Gross margin	7,734	5,138	19,751	13,425
Gross margin percentage	59 %	51 %	58 %	51 %
Operating expenses
Administrative	2,544	1,886	7,574	5,950
Sales and marketing	5,695	3,639	14,713	8,237
Research and development	3,515	2,322	8,469	6,114
	11,754	7,847	30,756	20,301
Financial expenses (income)	12	75	(28)	311
Loss (gain) on foreign currency translation	36	63	(322)	120
Loss before income taxes	(4,068)	(2,847)	(10,655)	(7,307)
Current income tax expense	88	9	116	43
Net result	(4,156)	(2,856)	(10,771)	(7,350)
Basic and diluted net loss per share	(0.04)	(0.03)	(0.10)	(0.07)

Table B

CONSOLIDATED BALANCE SHEET HIGHLIGHTS (in thousands of Canadian dollars)	As at	As at
	May 31, 2023	Aug 31, 2022
	$	$
Cash and cash equivalents	20,472	23,816
Trade and other receivables	7,880	5,855
Inventories	11,267	6,672
Total Current Assets	41,608	39,016
Property, plant, and equipment	3,374	2,683
Intangible assets	1,687	1,786
Right-of-use assets	7,500	5,026
Total Assets	54,169	48,511
Current liabilities	9,924	8,601
Long-term debt	1,437	639
Lease liabilities	7,680	5,012
Total Liabilities	19,041	14,252
Shareholders' equity	35,128	34,259

Conference Call Today

Louis Laflamme, President and Chief Executive Officer and John Hannigan, Chief Financial Officer, will hold a conference call to discuss the quarter's financial results at 11:00 a.m. (Eastern Time) today, July 13, 2023. 

Interested parties can access the conference call by dialing [phone] or [phone] or can listen via a live webcast at https://app.webinar.net/MQX1NGnl0m5. Please register 5 to 10 minutes before the beginning of the conference call.

A replay will be available after the call, in the Investors section of the Company's website at https://opsens.com/investors/events-presentations/.

About OpSens Inc. (www.OpSens.com or www.OpSensmedical.com)

OpSens focuses mainly on cardiology. The Company offers an advanced optical-based pressure guidewire that aims at improving the clinical outcome of patients with coronary artery disease. Its flagship product, the OptoWire, is a second-generation fiber optic pressure guidewire designed to provide the lowest drift in the industry and excellent lesions access. The OptoWire has been used in the diagnosis and treatment of more than 250,000 patients in more than 30 countries. It is approved for sale in the U.S., the European Union, the United Kingdom, Japan and Canada.

OpSens has recently received FDA clearance and Health Canada approval to commercialize the SavvyWire for transcatheter aortic valve replacement procedures (TAVR). This unique guidewire is a 3-in-1 solution for stable aortic valve delivery and positioning, continuous accurate hemodynamic measurement during the procedure, and reliable left ventricular pacing without the need for adjunct devices or venous access.

OpSens' SavvyWire is on trend with a minimalist approach to TAVR and advances the procedure, allowing patients to leave the hospital earlier, sometimes the same day.

The TAVR procedure is growing rapidly globally, driven by the aging population and recent studies that demonstrate its benefits for a broader array of patients. The global TAVR market is currently estimated at over 300,000 procedures and is expected to reach over 400,000 in 2025 and over 600,000 in 2030.

OpSens is also involved in industrial activities in developing, manufacturing, and installing innovative fiber optic sensing solutions for critical applications.

SOURCE OpSens Inc.

Louis Laflamme, CPA, President and Chief Executive Officer, 418.781.0333; John Hannigan, FCA, Chief Financial Officer, 418.781.0333