Tandem Diabetes Care sales grow 16% to $15.7 million in third quarter 2015

Tandem Diabetes Care, Inc.Oct 30 2015

Tandem Diabetes Care®, Inc. (NASDAQ: TNDM), a medical device company and manufacturer of the t:slim^®, t:flex^® and t:slim G4^™ Insulin Pumps, today reported its financial results for the quarter ended September 30, 2015.

In comparing the third quarter of 2015 to the same period of 2014:

• Sales grew 16 percent to $15.7 million from $13.5 million
• Pump shipments grew 17 percent to 3,431 pumps from 2,935 pumps
• Operating margin improved to negative 119 percent from negative 141 percent

In comparing the nine months ended September 30, 2015 to the same period of 2014:

• Sales grew 37 percent to $43.7 million from $31.8 million
• Pump shipments grew 34 percent to 9,249 pumps from 6,893 pumps
• Operating margin improved to negative 132 percent from negative 183 percent

In September, the Company received U.S. Food and Drug Administration approval and launched the t:slim G4 Insulin Pump, the first and only touch-screen pump with continuous glucose monitoring (CGM) integration. As anticipated, customers and distributors paused in their buying decision process following its approval to evaluate the t:slim G4 Pump, and in some cases satisfy any additional insurance verification requirements. This impacted the Company's sales and cost of sales in the third quarter. The Company now offers three different pump options for customers to manage their insulin therapy, and following the t:slim G4 launch has seen a significant increase in its preliminary sales order volumes.

"There has been extraordinary customer interest in the t:slim G4 Pump as the newest addition to our product family," said Kim Blickenstaff, President and Chief Executive Officer of Tandem Diabetes Care. "I'm proud that we were able to launch two new products since May, which allows us to further leverage our infrastructure while providing differentiated solutions to the diabetes community."

Gross margin improved to 35 percent for the quarter ended September 30, 2015 compared to 33 percent for the same period of 2014.

For the third quarter of 2015, operating expenses totaled $24.2 million compared to $23.4 million for the same period of 2014.

Operating loss for the third quarter of 2015 was $18.7 million, compared to $19.0 million for the same period of 2014. This included non-cash, stock-based compensation of $3.0 million for the quarter ended September 30, 2015 compared to $3.7 million for the comparable period of 2014.

As of September 30, 2015, the Company had $83.8 million in cash, cash equivalents and short-term investments.

For the year ending December 31, 2015, the Company has updated its guidance as follows:

• Sales are estimated to be in the range of $70.0 million to $75.0 million, which includes $4.0 million to $6.0 million of t:flex Insulin Pump sales.
• Operating margin is estimated to be in the range of negative 95 percent to negative 105 percent, which includes approximately $13.0 million to $14.0 million in non-cash, stock-based compensation expense.