REG - Burning Rock Biotech - BNR Reports Third Quarter 2023 Financial Results
30/11/2023 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20231130:nRSd1956Va&default-theme=true
RNS Number : 1956V Burning Rock Biotech Limited 30 November 2023
Burning Rock Reports Third Quarter 2023 Financial Results
GUANGZHOU, China, November 30, 2023-Burning Rock Biotech Limited (NASDAQ: BNR
and LSE: BNR, the "Company" or "Burning Rock"), a company focused on the
application of next generation sequencing (NGS) technology in the field of
precision oncology, today reported financial results for the three months
ended September 30, 2023.
Recent Business Updates
· Therapy Selection and Minimal Residual Disease (MRD)
o Personalized Minimal Residual Disease (MRD) product, brPROPHET(TM)
supports advancement in early-stage non-small cell lung cancer treatment, with
results published in the Cancer Cell in September 2023. The study, MEDAL, is a
5-year study that aimed to investigate the clinical utility of MRD in patients
with non-small cell lung cancer (NSCLC) with various approaches to ctDNA
detection, including MEDAL-Methylation and MEDAL-PROPHET. In MEDAL-PROPHET
study, brPROPHET(TM) demonstrated superior performance in head-to-head
comparisons with tumor-agnostic fixed-panel and tumor-informed fixed-panel MRD
assays.
· Early Detection
o Following the Breakthrough Device Designation granted by the US Food and
Drug Administration (FDA) for our OverC™ Multi-Cancer Detection Blood Test
(MCDBT) in January 2023, our OverC™ MCDBT also received the Breakthrough
Device Designation by China's National Medical Products Administration (NMPA)
in October 2023, making it the only test globally that has received
Breakthrough Device Designation from both the FDA and the NMPA.
· Pharma Services
o Entered into a Master Service Agreement in Oncology Companion Diagnostics
(CDx) with Boehringer Ingelheim, aiming to focus on advancing the clinical
trials related to Boehringer Ingelheim's MDM2-p53 antagonist, brigimadlin (BI
907828), and the development of CDx products in China.
o Total value of new contracts for the provision of pharma services entered
into during the third quarter of 2023 amounted to RMB90 million, representing
an 8% year-over-year increase.
Third Quarter 2023 Financial Results
Revenues were RMB127.6 million (US$17.5 million) for the three months ended
September 30, 2023, representing a 17.5% decrease from RMB154.6 million for
the same period in 2022.
· Revenue generated from central laboratory business was RMB53.5
million (US$7.3 million) for the three months ended September 30, 2023,
representing a 40.6% decrease from RMB90.0 million for the same period in
2022, primarily due to a decrease in the number of tests, as the Company
continued to focus on its in-hospital business.
· Revenue generated from in-hospital business was RMB54.5 million
(US$7.5 million) for the three months ended September 30, 2023, representing a
9.8% increase from RMB49.6 million for the same period in 2022, driven by an
increase in sales volume from existing hospitals and new contracted partner
hospitals.
· Revenue generated from pharma research and development services
was RMB19.6 million (US$2.7 million) for the three months ended September 30,
2023, representing a 30.6% increase from RMB15.0 million for the same period
in 2022, primarily attributable to increased development and testing services
performed for our pharma customers.
Cost of revenues was RMB41.6 million (US$5.7 million) for the three months
ended September 30, 2023, representing a 9.5% decrease from RMB46.0 million
for the same period in 2022, primarily due to a decrease in cost of central
laboratory business, which was in line with the decrease in revenue generated
from this business.
Gross profit was RMB85.9 million (US$11.8 million) for the three months ended
September 30, 2023, representing a 20.9% decrease from RMB108.6 million for
the same period in 2022. Gross margin was 67.4% for the three months ended
September 30, 2023, compared to 70.2% for the same period in 2022. By channel,
gross margin of central laboratory business was 77.6% for the three months
ended September 30, 2023, compared to 77.8% during the same period in 2022;
gross margin of in-hospital business was 65.1% for the three months ended
September 30, 2023, compared to 63.6% during the same period in 2022, and such
increase was primarily due to an increase in sales volume to high margin
hospitals; gross margin of pharma research and development services was 45.8%
for the three months ended September 30, 2023, compared to 46.7% during the
same period of 2022.
Non-GAAP gross profit, which excludes depreciation and amortization expenses,
was RMB95.1 million (US$13.0 million) for the three months ended September 30,
2023, representing a 18.7% decrease from RMB117.0 million for the same period
in 2022. Non-GAAP gross margin was 74.5% for the three months ended September
30, 2023, compared to 75.7% for the same period in 2022.
Operating expenses were RMB264.7 million (US$36.3 million) for the three
months ended September 30, 2023, representing a 22.9% decrease from RMB343.2
million for the same period in 2022. The decrease was primarily driven by
budget control measures and headcount reduction aimed at improving the
Company's operating efficiency.
· Research and development expenses were RMB83.7 million
(US$11.5 million) for the three months ended September 30, 2023, representing
a 23.5% decrease from RMB109.4 million for the same period in 2022, primarily
due to a decrease in staff cost resulted from the reorganization of our
research and development department to improve operating efficiency.
· Selling and marketing expenses were RMB62.3 million (US$8.5
million) for the three months ended September 30, 2023, representing a 31.0%
decrease from RMB90.3 million for the same period in 2022, primarily due to
(i) a decrease in staff cost resulted from the reorganization of our sales
department to improve operating efficiency, and (ii) a decrease in marketing
and conference fee.
· General and administrative expenses were RMB118.7 million
(US$16.3 million) for the three months ended September 30, 2023, representing
a 17.3% decrease from RMB143.5 million for the same period in 2022, primarily
due to (i) a decrease in amortized expense on share-based compensation; (ii) a
decrease in professional service fee; (iii) a decrease in allowance for
doubtful accounts resulting from accelerated settlement with customers with
long accounts receivable; and (iv) a decrease in staff cost resulted from the
reorganization of our general and administrative department to improve
operating efficiency.
Net loss was RMB175.0 million (US$24.0 million) for the three months ended
September 30, 2023, compared to RMB231.5 million for the same period in 2022.
Cash, cash equivalents, restricted cash and short-term investments were
RMB636.7 million (US$87.3 million) as of September 30, 2023.
Conference Call Information
Burning Rock will host a conference call to discuss the third quarter 2023
financial results at 7:00 a.m. U.S. Eastern Time (8:00 p.m. Hong Kong time) on
November 30, 2023.
Please register in advance of the conference using the link provided below and
dial in 15 minutes prior to the call, using participant dial-in numbers and
unique registrant ID which would be provided upon registering.
PRE-REGISTER LINK:
https://register.vevent.com/register/BIac92af260980471bb07fff2b22f7e50e
(https://register.vevent.com/register/BIac92af260980471bb07fff2b22f7e50e) .
Additionally, a live and archived webcast of the conference call will also be
available on the company's investor relations website at
http://ir.brbiotech.com (http://ir.brbiotech.com) or through link
https://edge.media-server.com/mmc/p/fo9urjv8
(https://edge.media-server.com/mmc/p/fo9urjv8) .
A replay of the webcast will be available for 12 months via the same link
above.
About Burning Rock
Burning Rock Biotech Limited (NASDAQ: BNR and LSE: BNR), whose mission is to
guard life via science, focuses on the application of next generation
sequencing (NGS) technology in the field of precision oncology. Its business
consists of i) NGS-based therapy selection testing for late-stage cancer
patients, and ii) cancer early detection, which has moved beyond
proof-of-concept R&D into the clinical validation stage.
For more information about Burning Rock, please visit: ir.brbiotech.com.
Safe Harbor Statement
This press release contains forward-looking statements. These statements
constitute "forward-looking" statements within the meaning of Section 21E of
the Securities Exchange Act of 1934, as amended, and as defined in the U.S.
Private Securities Litigation Reform Act of 1995. These forward-looking
statements can be identified by terminology such as "will," "expects,"
"anticipates," "future," "intends," "plans," "believes," "estimates,"
"target," "confident" and similar statements. Burning Rock may also make
written or oral forward-looking statements in its periodic reports to the SEC,
in its annual report to shareholders, in press releases and other written
materials and in oral statements made by its officers, directors or employees
to third parties. Statements that are not historical facts, including
statements about Burning Rock's beliefs and expectations, are forward-looking
statements. Such statements are based upon management's current expectations
and current market and operating conditions, and relate to events that involve
known or unknown risks, uncertainties and other factors, all of which are
difficult to predict and many of which are beyond Burning Rock's control.
Forward-looking statements involve risks, uncertainties and other factors that
could cause actual results to differ materially from those contained in any
such statements. All information provided in this press release is as of the
date of this press release, and Burning Rock does not undertake any obligation
to update any forward-looking statement as a result of new information, future
events or otherwise, except as required under applicable law.
Non-GAAP Measures
In evaluating the business, the company considers and uses non-GAAP measures,
such as non-GAAP gross profit and non-GAAP gross margin, as supplemental
measures to review and assess operating performance. The presentation of these
non-GAAP financial measures is not intended to be considered in isolation or
as a substitute for the financial information prepared and presented in
accordance with accounting principles generally accepted in the United States
of America ("U.S. GAAP"). The company defines non-GAAP gross profit as gross
profit excluding depreciation and amortization. The company defines non-GAAP
gross margin as gross margin excluding depreciation and amortization.
The company presents these non-GAAP financial measures because they are used
by management to evaluate operating performance and formulate business plans.
The company believe non-GAAP gross profit and non-GAAP gross margin excluding
non-cash impact of depreciation and amortization reflect the company's ongoing
business operations in a manner that provides more information regarding
period-to-period comparisons.
Contact: IR@brbiotech.com
Selected Operating Data
As of
June 30, 2022 September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023
In-hospital Channel:
Pipeline partner hospitals((1)) 25 22 28 29 30 29
Contracted partner hospitals((2)) 43 47 49 49 50 55
Total number of partner hospitals 68 69 77 78 80 84
((1)) Refers to hospitals that are in the process of establishing in-hospital
laboratories, laboratory equipment procurement or installation, staff training
or pilot testing using the Company's products.
((2)) Refers to hospitals that have entered into contracts to purchase the Company's
products for use on a recurring basis in their respective in-hospital
laboratories the Company helped them establish. Kit revenue is generated from
contracted hospitals.
((1))
Refers to hospitals that are in the process of establishing in-hospital
laboratories, laboratory equipment procurement or installation, staff training
or pilot testing using the Company's products.
((2))
Refers to hospitals that have entered into contracts to purchase the Company's
products for use on a recurring basis in their respective in-hospital
laboratories the Company helped them establish. Kit revenue is generated from
contracted hospitals.
Selected Financial Data
For the three months ended
Revenues September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023
(RMB in thousands)
Central laboratory channel 89,992 71,970 61,804 61,804 66,239 66,239 53,481 66,239
In-hospital channel 49,636 42,526 51,561 51,561 53,835 53,835 54,496 53,835
Pharma research and development channel 15,003 27,741 29,151 29,151 26,194 26,194 19,589 26,194
Total revenues 154,631 142,237 142,516 146,268 127,566
For the three months ended
Gross profit September 30, 2022 December 31, 2022 March 31, 2023 June 30, September 30, 2023
2023
(RMB in thousands)
Central laboratory channel 69,991 54,507 48,090 51,876 41,487
In-hospital channel 31,593 26,999 34,409 33,353 35,459
Pharma research and development channel 7,010 19,757 16,273 15,193 8,974
Total gross profit 108,594 101,263 98,772 100,422 85,920
For the three months ended
Share-based compensation expenses September 30, 2022 December 31, 2022 March 31, June 30, September 30, 2023
2023 2023
(RMB in thousands)
Cost of revenues 481 496 353 627 680
Research and development expenses 13,978 14,673 13,612 13,612 15,301 12,161
Selling and marketing expenses 2,346 2,247 1,606 3,389 2,848
General and administrative expenses 61,041 74,232 62,595 62,595 18,502 57,704
Total share-based compensation expenses 77,846 91,648 78,166 7816678,166 37,819 73,393
Burning Rock Biotech Limited
Unaudited Condensed Statements of Comprehensive Loss
(in thousands, except for number of shares and per share data)
For the three months ended
September 30, 2022 December 31,2022 March 31, 2023 June 30, 2023 September 30, 2023 September 30, 2023
RMB RMB RMB RMB RMB US$
Revenues 154,631 142,237 142,516 146,268 127,566 17,485
Cost of revenues (46,037) (40,974) (43,744) (45,846) (41,646) (5,708)
Gross profit 108,594 101,263 98,772 100,422 85,920 11,777
Operating expenses:
Research and development expenses (109,433) (100,827) (94,417) (95,779) (83,701) (11,472)
Selling and marketing expenses (90,275) (85,174) (64,774) (70,842) (62,310) (8,540)
General and administrative expenses (143,530) (132,705) (128,039) (69,525) (118,724) (16,272)
Total operating expenses (343,238) (318,706) (287,230) (236,146) (264,735) (36,284)
Loss from operations (234,644) (217,443) (188,458) (135,724) (178,815) (24,507)
Interest income 2,013 2,838 3,144 5,255 4,018 551
Other (expense) income, net (189) (84) 599 (118) (157) (22)
Foreign exchange gain (loss), net 1,337 365 (116) （210） 423 58
Loss before income tax (231,483) (214,324) (184,831) (130,797) (174,531) (23,920)
Income tax expenses - (1,901) (422) (445) (450) (62)
Net loss (231,483) (216,225) (185,253) (131,242) (174,981) (23,982)
Net loss attributable to Burning Rock Biotech Limited's shareholders (231,483) (216,225) (185,253) (131,242) (174,981) (23,982)
Net loss attributable to ordinary shareholders (231,483) (216,225) (185,253) (131,242) (174,981) (23,982)
Loss per share for class A and class B ordinary shares:
Class A ordinary shares - basic and diluted (2.23) （2.11) (1.81) (1.28) (1.71) (0.23)
Class B ordinary shares - basic and diluted (2.23) （2.11) (1.81) (1.28) (1.71) (0.23)
Weighted average shares outstanding used in loss per share computation:
Class A ordinary shares - basic and diluted 86,585,322 85,051,882 85,065,585 85,151,052 85,000,869 85,000,869
Class B ordinary shares - basic and diluted 17,324,848 17,324,848 17,324,848 17,324,848 17,324,848 17,324,848
Other comprehensive income (loss), net of tax of nil:
Foreign currency translation adjustments 20,646 (5,950) (5,659) 14,829 (1,955) (268)
Total comprehensive loss (210,837) (222,175) (190,912) (116,413) (176,936) (24,250)
Total comprehensive loss attributable to Burning Rock Biotech Limited's (210,837) (222,175) (190,912) (116,413) (176,936) (24,250)
shareholders
Burning Rock Biotech Limited
Unaudited Condensed Statements of Comprehensive Loss
(in thousands, except for number of shares and per share data)
For the nine months ended
September 30, September 30, September 30,
2022 2023 2023
RMB RMB US$
Revenues 421,001 416,350 57,065
Cost of revenues (142,225) (131,236) (17,987)
Gross profit 278,776 285,114 39,078
Operating expenses:
Research and development expenses (321,041) (273,897) (37,541)
Selling and marketing expenses (285,120) (197,926) (27,128)
General and administrative expenses (435,579) (316,288) (43,351)
Total operating expenses (1,041,740) (788,111) (108,020)
Loss from operations (762,964) (502,997) (68,942)
Interest income 6,620 12,417 1,702
Other income, net 236 324 44
Foreign exchange gain net 1,184 97 14
Loss before income tax (754,924) (490,159) (67,182)
Income tax expenses (84) (1,317) (181)
Net loss (755,008) (491,476) (67,363)
Net loss attributable to Burning Rock Biotech Limited's shareholders (755,008) (491,476) (67,363)
Net loss attributable to ordinary shareholders (755,008) (491,476) (67,363)
Loss per share for class A and class B ordinary shares:
Class A ordinary shares - basic and diluted (7.23) (4.80) (0.66)
Class B ordinary shares - basic and diluted (7.23) (4.80) (0.66)
Weighted average shares outstanding used in loss per share computation:
Class A ordinary shares - basic and diluted 87,097,027 85,070,921 85,070,921
Class B ordinary shares - basic and diluted 17,324,848 17,324,848 17,324,848
Other comprehensive income (loss), net of tax of nil:
Foreign currency translation adjustments 47,296 7,215 989
Total comprehensive loss (707,712) (484,261) (66,374)
Total comprehensive loss attributable to Burning Rock Biotech Limited's (707,712) (484,261) (66,374)
shareholders
Burning Rock Biotech Limited
Unaudited Condensed Consolidated Balance Sheets
(In thousands)
As of
December 31, 2022 September 30, September 30,
2023 2023
RMB RMB US$
ASSETS
Current assets:
Cash and cash equivalents 905,451 636,293 87,211
Restricted cash 19,817 456 63
Accounts receivable, net 109,954 141,155 19,347
Contract assets, net 41,757 58,320 7,993
Inventories, net 130,321 86,522 11,859
Prepayments and other current assets, net 51,462 44,282 6,069
Total current assets 1,258,762 967,028 132,542
Non-current assets:
Equity method investment 690 387 53
Convertible note receivable 5,105 5,105 700
Property and equipment, net 251,829 161,715 22,165
Operating right-of-use assets 48,205 20,380 2,793
Intangible assets, net 1,986 1,277 175
Other non-current assets 20,890 10,819 1,483
Total non-current assets 328,705 199,683 27,369
TOTAL ASSETS 1,587,467 1,166,711 159,911
Burning Rock Biotech Limited
Unaudited Condensed Consolidated Balance Sheets (Continued)
(in thousands)
As of
December 31, 2022 September 30, September 30,
2023 2023
RMB RMB US$
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable 50,947 24,103 3,304
Deferred revenue 147,633 144,287 19,776
Accrued liabilities and other current liabilities 173,832 111,595 15,295
Customer deposits 1,803 1,197 164
Current portion of operating lease liabilities 37,236 13,985 1,917
Total current liabilities 411,451 295,167 40,456
Non-current liabilities:
Non-current portion of operating lease liabilities 13,551 5,110 700
Other non-current liabilities 4,124 3,468 475
Total non-current liabilities 17,675 8,578 1,175
TOTAL LIABILITIES 429,126 303,745 41,631
Shareholders' equity:
Class A ordinary shares 117 116 16
Class B ordinary shares 21 21 3
Additional paid-in capital 4,582,790 4,778,636 654,967
Treasury stock (58,919) (65,878) (9,029)
Accumulated deficits (3,199,946) (3,691,422) (505,952)
Accumulated other comprehensive loss (165,722) (158,507) (21,725)
Total shareholders' equity 1,158,341 862,966 118,280
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 1,587,467 1,166,711 159,911
Burning Rock Biotech Limited
Unaudited Condensed Statements of Cash Flows
(in thousands)
For the three months ended
September 30, 2022 September 30, 2023 September 30, 2023
RMB RMB US$
Net cash used in operating activities (135,467) (47,417) (6,499)
Net cash used in investing activities (20,148) (1,985) (272)
Net cash used in financing activities (2,671) (45,888) (6,289)
Effect of exchange rate on cash, cash equivalents and restricted cash 19,242 (1,239) (170)
Net decrease in cash, cash equivalents and restricted cash (139,044) (96,529) (13,230)
Cash, cash equivalents and restricted cash at the beginning of period 1,153,050 733,278 100,504
Cash, cash equivalents and restricted cash at the end of period 1,014,006 636,749 87,274
For the nine months ended
September 30, 2022 September 30, 2023 September 30, 2023
RMB RMB US$
Net cash used in operating activities (389,101) (239,764) (32,862)
Net cash used in investing activities (2,430) (8,972) (1,230)
Net cash used in financing activities (76,164) (46,923) (6,431)
Effect of exchange rate on cash, cash equivalents and restricted cash 42,590 7,140 978
Net decrease in cash, cash equivalents and restricted cash (425,105) (288,519) (39,545)
Cash, cash equivalents and restricted cash at the beginning of period 1,439,112 925,268 126,819
Cash, cash equivalents and restricted cash at the end of period 1,014,007 636,749 87,274
Burning Rock Biotech Limited
Reconciliations of GAAP and Non-GAAP Results
For the three months ended
September 30, 2022 December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023
(RMB in thousands)
Gross profit:
Central laboratory channel 69,991 54,507 48,090 51,876 41,487
In-hospital channel 31,593 26,999 34,409 33,353 35,459
Pharma research and development channel 7,010 19,757 16,273 15,193 8,974
Total gross profit 108,594 101,263 98,772 100,422 85,920
Add: depreciation and amortization:
Central laboratory channel 3,138 3,609 2,567 2,645 2,550
In-hospital channel 2,479 2,449 2,582 2,637 2,751
Pharma research and development channel 2,805 3,065 3,974 3,665 3,863
Total depreciation and amortization included in cost of revenues 8,422 9,123 9,123 8,947 9,164
Non-GAAP gross profit：
Central laboratory channel 73,129 58,116 50,657 54,521 44,037
In-hospital channel 34,072 29,448 36,991 35,990 38,210
Pharma research and development channel 9,815 22,822 20,247 18,858 12,837
Total non-GAAP gross profit 117,016 110,386 110,386 107,895 107,895 109,369 95,084
Non-GAAP gross margin：
Central laboratory channel 81.3% 80.8% 82.0% 82.3% 82.3%
In-hospital channel 68.6% 69.2% 71.7% 66.9% 70.1%
Pharma research and development channel 65.4% 82.3% 69.5% 72.0% 65.5%
Total non-GAAP gross margin 75.7% 77.6% 75.7% 74.8% 74.5%
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END QRTWPGWPGUPWUCURecent news on Burning Rock Biotech
See all newsREG - Burning Rock Biotech - Burning Rock Announces ADS Ratio Change
AnnouncementREG - Burning Rock Biotech - BNR Reports 23Q4 and Full Year Financial Results
AnnouncementREG - Burning Rock Biotech - BNR Announces Receipt of Notification from NASDAQ
AnnouncementREG - Burning Rock Biotech - BNR Announces Results of 2023 AGM
AnnouncementREG - Burning Rock Biotech - BNR Reports Third Quarter 2023 Financial Results
Announcement