Press Release

Veracyte Announces Fourth Quarter and Full-Year 2021 Financial Results

February 28, 2022
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Grew Fourth Quarter 2021 Revenue to $67.3 Million, an Increase of 95%

Grew 2021 Revenue to $219.5 Million, an Increase of 87%

Conference Call and Webcast Today at 4:30 p.m. ET

SOUTH SAN FRANCISCO, Calif.--(BUSINESS WIRE)--Feb. 28, 2022-- Veracyte, Inc. (Nasdaq: VCYT) today announced financial results for the fourth quarter and full year ended December 31, 2021.

“Our business continued to perform well in the fourth quarter, despite facing unanticipated COVID-related headwinds,” said Marc Stapley, Veracyte’s chief executive officer. “Moreover, 2021 was a pivotal year for Veracyte as we believe we put the major strategic pieces in place, including the acquisitions of Decipher and HalioDx, to position us to achieve our vision of becoming a global diagnostics leader. We look forward to building on this progress in 2022 with key milestones to support our near- and long-term growth.”

Fourth Quarter 2021 Financial Results

For the fourth quarter of 2021, as compared with the fourth quarter of 2020:

  • Total Revenue was $67.3 million, an increase of 95%;
  • Operating Expenses, Excluding Cost of Revenue, were $56.8 million, an increase of 81%;
  • Net Loss was $10.5 million, an increase of 31%;
  • Basic and Diluted Net Loss Per Common Share was $0.15, an increase of 7%;
  • Net Cash Provided by Operating Activities was $8.4 million, an increase of $6.1 million; and
  • Cash and Cash Equivalents were $173.2 million at December 31, 2021.

For the year ended December 31, 2021, compared to the prior year:

  • Total Revenue was $219.5 million, an increase of 87%;
  • Operating Expenses, Excluding Cost of Revenue, were $227.0 million, an increase of 104%, including $47.2 million of acquisition-related expenses;
  • Net Loss was $75.6 million, an increase of 116%, including $47.2 million of acquisition-related expenses;
  • Basic and Diluted Net Loss Per Common Share was $1.11, an increase of 68%, including $0.70 per share attributable to acquisition-related expenses; and
  • Net Cash Used in Operating Activities was $31.6 million, including $43.6 million of acquisition-related expenses, compared to $9.7 million.

Key Business Highlights

  • Grew test volume to 22,300 in the fourth quarter and 78,565 in full-year 2021, increases of 70% and 77%, respectively, compared to the prior year.
  • Completed the acquisitions of Decipher Biosciences and HalioDx, positioning Veracyte to drive global expansion with a broad menu of high-performance tests.
  • Published clinical utility studies for the Afirma, Percepta and Envisia genomic classifiers in the Journal of the American Society of Cytopathology, BMC Pulmonary Medicine and AnnalsATS, respectively.
  • Broadened the clinical evidence for the Decipher Prostate Genomic Classifier including the presentation of data from a randomized Phase 3 trial at ASCO Genitourinary Symposium which demonstrated the test’s ability to guide therapy in men with intermediate-risk prostate cancer; received an expanded recommendation in 2022 National Comprehensive Cancer Network® (NCCN) Clinical Practice Guidelines for Oncology, which uniquely predicates treatment decisions based on patients’ Decipher Prostate test scores.
  • Commercially launched the Decipher Bladder Genomic Classifier in November 2021 following a Medicare coverage policy and publication of strong clinical validation data in the Journal of Urology.
  • Began running the Percepta Nasal Swab test for improved early detection of lung cancer in Veracyte’s CLIA lab and returned results to the first patients as Veracyte began to assemble the clinical utility evidence to support future reimbursement and guideline inclusion.
  • Augmented and reorganized the leadership team to deliver on Veracyte’s global strategic vision.

2022 Financial Outlook

Veracyte is initiating 2022 annual total revenue guidance of $260 million to $275 million, representing year-over-year growth of 18% to 25%, compared to the prior year.

Conference Call and Webcast Details

Veracyte will host a conference call and webcast today at 4:30 p.m. Eastern Time to discuss the company's financial results and provide a general business update. The conference call will be webcast live from the company’s website and will be available via the following link: https://protect-us.mimecast.com/s/IyUzCADA4pUjMMGcmQqy2. The webcast should be accessed 10 minutes prior to the conference call start time. A replay of the webcast will be available for one year following the conclusion of the live broadcast and will be accessible on the company’s website at https://investor.veracyte.com/events-presentations.

The conference call can be accessed as follows:

U.S./Canada participant dial-in number (toll-free):

(855) 541-0980

International participant dial-in number:

(970) 315-0440

Conference I.D.:

5377945

About Veracyte

Veracyte (Nasdaq: VCYT) is a global diagnostics company that improves patient care by answering important clinical questions to inform diagnosis and treatment decisions throughout the patient journey. Our growing menu of advanced diagnostic tests help patients avoid risky, costly procedures and interventions, and reduce time to appropriate treatment. Our tests address eight of the 10 most prevalent cancers by incidence in the United States. In addition to making our tests available in the United States through our central laboratories, our exclusive license to a best-in-class diagnostics instrument positions us to deliver our tests to patients worldwide through laboratories that can perform them locally. Veracyte is based in South San Francisco, California. For more information, please visit www.veracyte.com and follow the company on Twitter (@veracyte).

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements, including, but not limited to, our statements related to our expected total revenue and other financial and operating results for 2022 and our plans, objectives, expectations (financial and otherwise) or intentions with respect to our Prosigna, Afirma, Percepta, Envisia, LymphMark, Decipher Prostate, Percepta Nasal Swab, Percepta Genomic Atlas and Decipher Bladder tests and products for use in diagnosing and treating diseases, Medicare coverage, and our commercial organization. Forward-looking statements can be identified by words such as: “appears,” "anticipate," "intend," "plan," "expect," "believe," "should," "may," "will," “positioned,” “designed” and similar references to future periods. Actual results may differ materially from those projected or suggested in any forward-looking statements. These statements involve risks and uncertainties, which could cause actual results to differ materially from our predictions, and include, but are not limited to our ability to launch, commercialize and receive reimbursement for our products, to successfully integrate the HalioDx and Decipher businesses and execute on our business plans; continue to scale our global operations and enhance our internal control environment; the impact of the COVID-19 pandemic and its variants on our business and general economic conditions; and the performance and utility of our tests in the clinical environment. Additional factors that may impact these forward-looking statements can be found under the caption “Risk Factors” in our Quarterly Report on Form 10-Q filed with the SEC on November 9, 2022 and our Annual Report on Form 10-K to be filed for the year ended December 31, 2021. Copies of these documents, when available, may be found in the Investors section of our website at www.investor.veracyte.com. These forward-looking statements speak only as of the date hereof and, except as required by law, we specifically disclaim any obligation to update these forward-looking statements or reasons why actual results might differ, whether as a result of new information, future events or otherwise.

Veracyte, the Veracyte logo, HalioDx, Decipher, Decipher GRID, Afirma, Percepta, Envisia, Prosigna, LymphMark, Immunoscore, TMExplore, Brightplex, Immunosign, “Know by Design” and “More about You” are registered trademarks of Veracyte, Inc. and its subsidiaries in the U.S. and selected countries. nCounter is the registered trademark of NanoString Technologies, Inc. in the U.S. and selected countries and used by Veracyte under license.

VERACYTE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands of dollars, except share and per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended
December 31,

Twelve Months Ended
December 31,

 

2021

2020

2021

2020

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Testing revenue

$

53,414

 

$

31,497

 

$

188,182

 

$

101,970

 

Product revenue

 

2,758

 

 

2,696

 

 

11,464

 

 

9,845

 

Biopharmaceutical and other revenue

 

11,164

 

 

343

 

 

19,868

 

 

5,668

 

Total revenue

 

67,336

 

 

34,536

 

 

219,514

 

 

117,483

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses(1):

 

 

 

 

 

 

 

 

 

 

 

 

Cost of testing revenue

 

16,366

 

 

9,756

 

 

58,860

 

 

35,913

 

Cost of product revenue

 

1,583

 

 

1,382

 

 

5,887

 

 

4,921

 

Cost of biopharmaceutical and other revenue

 

4,933

 

 

49

 

 

9,653

 

 

621

 

Research and development

 

10,252

 

 

4,586

 

 

29,843

 

 

17,204

 

Selling and marketing

 

22,212

 

 

13,149

 

 

79,840

 

 

52,389

 

General and administrative

 

18,849

 

 

12,413

 

 

101,353

 

 

36,729

 

Intangible asset amortization

 

5,474

 

 

1,273

 

 

15,981

 

 

5,095

 

Total operating expenses

 

79,669

 

 

42,608

 

 

301,417

 

 

152,872

 

Loss from operations

 

(12,333

)

 

(8,072

)

 

(81,903

)

 

(35,389

)

Other income, net

 

1,016

 

 

28

 

 

254

 

 

480

 

Loss before income tax benefit

 

(11,317

)

 

(8,044

)

 

(81,649

)

 

(34,909

)

Income tax benefit

 

(789

)

 

—

 

 

(6,086

)

 

—

 

Net loss

$

(10,528

)

$

(8,044

)

$

(75,563

)

$

(34,909

)

Net loss per common share, basic and diluted

$

(0.15

)

$

(0.14

)

$

(1.11

)

$

(0.66

)

Shares used to compute net loss per common share, basic and diluted

 

71,064,467

 

 

58,023,753

 

 

67,890,328

 

 

53,239,231

 

 

(1) Cost of revenue, research and development, sales and marketing and general and administrative expenses include the following stock-based compensation related expenses:

 

Three Months Ended
December 31,

Twelve Months Ended
December 31,

2021

2020

2021

2020

HalioDx stock-based compensation expense

$

1,376

$

—

$

3,944

$

—

Other stock-based compensation expense

5,438

3,640

19,024

12,995

Total stock-based compensation expense

$

6,814

$

3,640

$

22,968

$

12,995

VERACYTE, INC.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS

(Unaudited)

(In thousands)

 

 

 

 

 

 

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

2021

 

2020

 

2021

 

2020

Net loss

$

(10,528

)

 

$

(8,044

)

 

$

(75,563

)

 

$

(34,909

)

Other comprehensive loss:

 

 

 

 

 

 

 

Change in currency translation adjustments

 

(6,943

)

 

 

—

 

 

 

(15,083

)

 

 

—

 

Net comprehensive loss

$

(17,471

)

 

$

(8,044

)

 

$

(90,646

)

 

$

(34,909

)

VERACYTE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

 

 

 

 

December 31,

December 31,

 

2021

2020

 

(Unaudited)

(See Note 1)

Assets

 

 

Current assets:

 

 

Cash and cash equivalents

$

173,197

$

349,364

Accounts receivable

 

41,461

 

18,461

Supplies

 

11,225

 

4,657

Prepaid expenses and other current assets

 

17,219

 

3,197

Total current assets

 

243,102

 

375,679

Property and equipment, net

 

15,098

 

8,990

Right-of-use assets - operating leases

 

16,043

 

7,843

Intangible assets, net

 

202,731

 

59,924

Goodwill

 

707,904

 

2,725

Restricted cash

 

749

 

603

Other assets

 

2,198

 

1,399

Total assets

$

1,187,825

$

457,163

Liabilities and Stockholders’ Equity

 

 

Current liabilities:

 

 

Accounts payable

$

12,360

$

3,116

Accrued liabilities

 

39,475

 

11,705

Current portion of long-term debt

 

1,127

 

—

Current portion of deferred revenue

 

4,646

 

371

Current portion of acquisition-related contingent consideration

 

2,682

 

—

Current portion of operating lease liabilities

 

3,630

 

1,589

Current portion of other liabilities

 

231

 

—

Total current liabilities

 

64,151

 

16,781

Long-term debt

 

—

 

810

Deferred revenue, net of current portion

 

343

 

829

Deferred tax liability

 

5,592

 

—

Acquisition related contingent consideration, net of current portion

 

5,722

 

7,594

Operating lease liabilities, net of current portion

 

14,096

 

9,917

Other liabilities

 

1,407

 

—

Total liabilities

 

91,311

 

35,931

Total stockholders’ equity

 

1,096,514

 

421,232

Total liabilities and stockholders’ equity

$

1,187,825

$

457,163

 

 

 

1 The condensed balance sheet at December 31, 2020 has been derived from the audited financial statements at that date included in the Company's Form 10-K filed with the Securities and Exchange Commission dated February 22, 2021.

VERACYTE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands of dollars)

 

 

 

 

 

 

 

 

 

Twelve Months Ended
December 31,

 

2021

 

2020

Operating activities

 

 

 

 

 

 

 

Net loss

$

(75,563

)

 

$

(34,909

)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

 

 

 

Depreciation and amortization

 

19,593

 

 

 

7,944

 

Stock-based compensation

 

22,519

 

 

 

12,995

 

Benefit from income taxes

 

(6,258

)

 

 

—

 

Interest on end-of-term debt obligations

 

216

 

 

 

216

 

Write-down of excess supplies

 

—

 

 

 

1,088

 

Noncash lease expense

 

1,632

 

 

 

964

 

Revaluation of acquisition-related contingent consideration

 

810

 

 

 

1,506

 

Impairment loss

 

—

 

 

 

1,000

 

Effect of foreign currency on operations

 

1,211

 

 

 

(34

)

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivable

 

(8,571

)

 

 

955

 

Supplies

 

(1,464

)

 

 

1,061

 

Prepaid expenses and other current assets

 

(3,316

)

 

 

(970

)

Other assets

 

(216

)

 

 

37

 

Operating lease liability

 

(1,794

)

 

 

(1,407

)

Accounts payable

 

5,155

 

 

 

711

 

Accrued liabilities and deferred revenue

 

14,425

 

 

 

(868

)

Net cash used in operating activities

 

(31,621

)

 

 

(9,711

)

Investing activities

 

 

 

 

 

 

 

Acquisition of Decipher Biosciences, net of cash acquired

 

(574,411

)

 

 

—

 

Acquisition of HalioDx, net of cash acquired

 

(162,419

)

 

 

—

 

Proceeds from sale of equity securities

 

3,000

 

 

 

—

 

Purchase of equity securities

 

—

 

 

 

(1,000

)

Purchases of property and equipment

 

(5,376

)

 

 

(2,837

)

Net cash used in investing activities

 

(739,206

)

 

 

(3,837

)

Financing activities

 

 

 

 

 

 

 

Proceeds from the issuance of common stock in a public offering, net of issuance costs

 

593,821

 

 

 

193,831

 

Payment of long-term debt

 

—

 

 

 

(100

)

Payment of taxes on vested restricted stock units

 

(9,029

)

 

 

(3,845

)

Proceeds from the exercise of common stock options and employee stock purchases

 

11,528

 

 

 

13,709

 

Net cash provided by financing activities

 

596,320

 

 

 

203,595

 

(Decrease) increase in cash, cash equivalents and restricted cash

 

(174,507

)

 

 

190,047

 

Effect of foreign currency on cash, cash equivalents and restricted cash

 

(1,514

)

 

 

—

 

Net (decrease) increase in cash, cash equivalents and restricted cash

 

(176,021

)

 

 

190,047

 

Cash, cash equivalents and restricted cash at beginning of period

 

349,967

 

 

 

159,920

 

Cash, cash equivalents and restricted cash at end of period

$

173,946

 

 

$

349,967

 

CASH, CASH EQUIVALENTS AND RESTRICTED CASH

(Unaudited)

(In thousands of dollars)

 

 

 

 

 

 

 

December 31,

 

December 31,

 

2021

 

2020

Cash and cash equivalents

$

173,197

 

$

349,364

Restricted cash

 

749

 

 

603

Total cash, cash equivalents and restricted cash

$

173,946

 

$

349,967

 

Investor and Media Contact:

Tracy Morris
Vice President of Corporate Communications & Investor Relations
650-380-4413
tracy.morris@veracyte.com

Source: Veracyte, Inc.