ZELTIQ
Jul 31, 2013

ZELTIQ Announces Second Quarter 2013 Financial Results

Raises 2013 Financial Guidance

PLEASANTON, Calif., July 31, 2013 (GLOBE NEWSWIRE) -- ZELTIQ® (Nasdaq:ZLTQ), a medical technology company focused on developing and commercializing products utilizing its proprietary controlled-cooling technology platform, today announced financial results for the second quarter 2013.

Mark Foley, President and Chief Executive Officer, said, "I am very pleased with our performance through the first half of 2013. In the second quarter, we expanded our market leadership position due to the continued execution of our sales team combined with growing physician confidence in the clinical performance of our CoolSculpting® technology. Our Account Managers continued to expand our market share, placing systems with new customers as well as additional systems with existing customers, while our Product Support Specialists increased utilization by leveraging their new training and marketing tools to achieve strong consumable revenue growth. The results we achieved in the first half of this year reinforce and validate the changes and programs we have put into place thus far. We have increased confidence in the business maintaining this momentum into the second half of the year and we are pleased to be raising our full year revenue guidance."

Second Quarter Financial Review

Total net revenue for the second quarter 2013 was $26.3 million, consisting of $13.0 million of system revenue and $13.4 million of consumable revenue. This compares to total net revenue of $22.3 million for the second quarter 2012, consisting of $12.0 million of system revenue and $10.3 million of consumable revenue.  First quarter 2013 total net revenue was $20.0 million, consisting of $11.1 million of system revenue and $8.9 million of consumable revenue.  Cycles shipped increased 34% to 112,794 for the second quarter 2013, compared to 84,072 for the second quarter 2012, and up 45% sequentially compared to the 77,559 cycles shipped for the first quarter 2013. 

Gross profit was $18.5 million, or 70% of revenue, for the second quarter 2013, compared to gross profit of $15.1 million, or 68% of revenue, for the second quarter 2012. First quarter 2013 gross profit was $12.6 million, or 63% of revenue.

Operating expenses for the second quarter 2013 were $22.1 million, compared to $23.2 million for the second quarter 2012 and $20.1 million for the first quarter 2013.  

Net loss for the second quarter 2013 was $3.6 million, compared to $8.1 million for the second quarter 2012 and $7.5 million for the first quarter 2013.  Net loss for the second quarter 2013 was $0.10 per share, compared to a net loss of $0.24 per share for the second quarter 2012, and a net loss of $0.21 per share for the first quarter 2013. Weighted average diluted shares outstanding for the second quarter 2013, second quarter 2012, and first quarter 2013 was 36.0 million, 34.3 million and 35.9 million, respectively. 

Cash and cash equivalents, short-term investments, and long-term investments were $52.5 million as of June 31, 2013 compared to $51.6 million as of March 31, 2013.

Full Year 2013 Financial Guidance

ZELTIQ is updating its previously stated financial guidance for the full year 2013:

Conference Call

ZELTIQ will hold a conference call on Wednesday, July 31, 2013, at 4:30 p.m. ET to discuss the results. The dial-in numbers are (877) 280-7291 for domestic callers and (707) 287-9361 for international callers. A live webcast of the conference call will be available online from the investor relations page of the company's corporate website at www.coolsculpting.com.

After the live webcast, the call will remain available on ZELTIQ's website, www.coolsculpting.com, until ZELTIQ releases its third quarter 2013 financial results. In addition, a telephonic replay of the call will be available until August 7, 2013. The replay dial-in numbers are (855) 859-2056 for domestic callers and (404) 537-3406 for international callers. Please use the replay conference ID number 18079217.

About ZELTIQ®

ZELTIQ is a medical technology company focused on developing and commercializing products utilizing its proprietary controlled-cooling technology platform. ZELTIQ's first commercial product, the CoolSculpting System, is designed to selectively reduce stubborn fat that may not respond to diet or exercise. CoolSculpting is based on the scientific principle that fat cells are more sensitive to cold than the overlying skin and surrounding tissues. It utilizes patented technology of precisely controlled cooling to reduce the temperature of fat cells in the treated area, which is intended to cause fat cell elimination through a natural biological process known as apoptosis. ZELTIQ developed CoolSculpting to safely, noticeably, and measurably reduce the fat layer.

Forward-Looking Statements

The statements made in this press release regarding the information under the caption "Full Year 2013 Financial Guidance" and related statements in Mr. Foley's quote are forward-looking statements. You should not place undue reliance on these forward-looking statements because they involve known and unknown risks, uncertainties and other factors that are, in some cases, beyond ZELTIQ's control and that could materially affect the company's actual business operations and financial performance and condition. Factors that could materially affect ZELTIQ's business operations and financial performance and condition include, but are not limited to: the recent additions to the commercial sales team may require more time than ZELTIQ expects to integrate these employees into the company; less than anticipated growth in the number of physicians electing to purchase CoolSculpting Systems; patient demand for CoolSculpting procedures may be lower than ZELTIQ expects; product or procedure announcements by competitors may decrease demand for CoolSculpting procedures; ZELTIQ may incorrectly estimate or control its future expenditures; ZELTIQ's sales and marketing plans may fail to increase sales as ZELTIQ expects; as well as those other risks and uncertainties set forth in ZELTIQ's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2013, filed with the SEC on April 26, 2013. These forward-looking statements speak only as of the date of this press release. ZELTIQ expressly disclaims any obligation to update information contained in these forward-looking statements whether as a result of new information, future events or otherwise.

ZELTIQ Aesthetics, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(In thousands, except share and per share data)
         
  Three Months Ended
June 30,
Six Months Ended
June 30,
  2013 2012 2013 2012
Revenue  $ 26,338  $ 22,265  $ 46,320  $ 39,669
Cost of revenue  7,878  7,150  15,226  13,143
Gross profit  18,460  15,115  31,094  26,526
Operating expenses:        
Research and development  3,898  3,369  7,647  6,767
Sales and marketing  14,625  14,254  27,167  28,751
General and administrative  3,626  5,556  7,434  9,409
Total operating expenses  22,149  23,179  42,248  44,927
Loss from operations  (3,689)  (8,064)  (11,154)  (18,401)
Interest income, net  19  60  43  89
Other income (expense), net  106  (47)  72  (64)
Loss before provision for income taxes  (3,564)  (8,051)  (11,039)  (18,376)
Provision for income taxes  43  50  50  70
Net loss  $ (3,607)  $ (8,101)  $ (11,089)  $ (18,446)
Net loss per share, basic and diluted  $ (0.10)  $ (0.24)  $ (0.31)  $ (0.54)
Weighted average shares of common stock outstanding used in computing net loss per share, basic and diluted  36,045,346  34,253,357  35,968,144  34,129,555
 
ZELTIQ Aesthetics, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(In thousands)
     
  June 30,
2013
December 31,
2012
ASSETS    
CURRENT ASSETS:    
Cash and cash equivalents  $ 22,062  $ 22,876
Short-term investments  20,340  22,563
Accounts receivable, net  7,542  7,133
Inventory  9,616  10,871
Prepaid expenses and other current assets  3,470  3,600
Total current assets  63,030  67,043
Long-term investments  10,128  13,141
Restricted cash  324  469
Property and equipment, net  2,177  2,336
Intangible asset, net  6,831  7,181
Other assets  99  99
Total assets  $ 82,589  $ 90,269
LIABILITIES AND STOCKHOLDERS' EQUITY    
CURRENT LIABILITIES:    
Accounts payable  $ 2,823  $ 4,976
Accrued liabilities  13,788  11,076
Deferred revenue  1,133  1,401
Total current liabilities  17,744  17,453
Other non-current liabilities  231  236
Total liabilities  $ 17,975  $ 17,689
     
STOCKHOLDERS' EQUITY:    
Total stockholders' equity  64,614  72,580
Total liabilities and stockholders' equity  $ 82,589  $ 90,269
CONTACT: Investor Relations:

         Patrick F. Williams

         ZELTIQ, Senior Vice President and CFO

         925-474-2500



         Nick Laudico

         The Ruth Group

         646-536-7030

         nlaudico@theruthgroup.com

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Source: ZELTIQ Aesthetics, Inc.

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