Backlog revenues due to future lease agreements increased 27% to $19 million
Quarterly revenues increased 11%
Brainsway reports a receipt of a bank credit line for $6 million for a period of 42 months
HACKENSACK, N.J., Aug. 22, 2017- Brainsway Ltd. (TASE:BRIN), a leader in the advanced non-invasive treatment of brain disorders, announced today the company’s financial results for the quarter ended June 30, 2017, which signifies another quarter of implementing the company's new business model focused mainly on leasing Brainsway Systems to customers.
"We are very pleased with our increased revenues in the second quarter. Our goal is to have Brainsway deliver on our plan for consistent, long-term growth plan, based on increased demand for our unique Deep TMS systems and the expected steady growth in use and demand," said Yaacov Michlin, Brainsway CEO. "The new bank credit, in addition to the company's current cash, will satisfy our finance needs to accomplish our objectives without diluting our shareholders. Receiving this bank credit confirms the strength of our new business model."
Joe Perekupka, VP of North American Sales Operations, stated, “Our sales team continues to focus intently on growing our equipment leasing business, which is an integral part of Brainsway’s broader strategy shift to a flexible business model allowing more customers to easily add a Brainsway Deep TMS system to their practices.”
Mr. Michlin added, “Our leasing activity demonstrates customers’ recognition of the competitive advantages of our systems and their intention to increase the number of patients they will treat. Brainsway has a large customer base and most of the agreements signed by the company are 3 to 5 years in length. These agreements boost the company's expected revenue potential, as reflected in an increase in the backlog revenue.”
As part of implementing the company’s system leasing model, Brainsway is providing the backlog revenue expected from all of the company's lease contracts signed with customers as of June 30, 2017. At the end of second quarter 2017, the estimated minimum revenue (before usage fees) are $19.1 million, an increase of 27%, compared to the estimated minimum revenues (before usage fees) of $15.0 million reported at the end of the first quarter of 2017.
Brainsway also announced that it has entered into the framework of an agreement with an Israeli leading commercial bank, Mizrahi Tefahot, to provide a credit line to the company for a total amount of up to $6 million. Repayment of the principal amounts, which will be borrowed in two tranches, will be made in eight consecutive quarterly payments starting from March 2019.
Brainsway is engaged in the research, development and marketing of a medical system for non-invasive treatment of common brain disorders. The medical system developed and manufactured by the company is based on a unique and breakthrough technology called Deep TMS, which can reach the depth of the brain and produce nerve stimulation or suppression. About 90% of US depression patients currently have coverage for Deep TMS. The company's systems have also received both CE and FDA clearance and are sold worldwide.