vero20220331

vero20220331_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission File Number: 001-38238

Venus Concept Inc.

(Exact Name of Registrant as Specified in its Charter)

Delaware

06-1681204

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

235 Yorkland Blvd., Suite 900

Toronto, Ontario M2J 4Y8

(877) 848-8430

(Address including zip code, and telephone number including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, $0.0001 par value per share		VERO		The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☒	Smaller reporting company	☒

		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of May 9, 2022 the registrant had 63,999,044 shares of common stock, $0.0001 par value per share, outstanding.

Table of Contents

Table of Contents

		Page
Part I.	Financial Information	2
Item 1.	Condensed Consolidated Financial Statements (unaudited)	2
	Condensed Consolidated Balance Sheets	2
	Condensed Consolidated Statements of Operations	3
	Condensed Consolidated Statements of Comprehensive Loss	4
	Condensed Consolidated Statements of Stockholders’ Equity	5
	Condensed Consolidated Statements of Cash Flows	6
	Notes to the Condensed Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	43
PART II.	Other Information	44
Item 1.	Legal Proceedings	44
Item 1A.	Risk Factors	44
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	44
Item 3.	Defaults Upon Senior Securities	45
Item 4.	Mine Safety Disclosures	45
Item 5.	Other Information	45
Item 6.	Exhibits	45
Signatures		46

Table of Contents

PART I

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

VENUS CONCEPT INC.

Condensed Consolidated Balance Sheets

(Unaudited)

_{(in thousands, except for shares and per share data)}

	*March 31,*			*December 31,*
	*2022*			*2021*
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	17,911		$	30,876
Accounts receivable, net of allowance of $12,742 and $11,997 as of March 31, 2022, and December 31, 2021		49,076			46,918
Inventories		21,319			20,543
Prepaid expenses		2,446			2,737
Advances to suppliers		3,532			2,162
Other current assets		4,139			3,758
Total current assets		98,423			106,994
LONG-TERM ASSETS:
Long-term receivables		27,747			27,710
Deferred tax assets		249			284
Severance pay funds		884			817
Property and equipment, net		2,583			2,669
Intangible assets		14,536			15,393
Total long-term assets		45,999			46,873
TOTAL ASSETS	$	144,422		$	153,867
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Trade payables	$	4,788		$	4,913
Accrued expenses and other current liabilities		18,818			19,512
Income taxes payable		415			294
Unearned interest income		2,727			2,678
Warranty accrual		1,127			1,245
Deferred revenues		1,585			2,030
Current portion of government assistance loans		136			543
Total current liabilities		29,596			31,215
LONG-TERM LIABILITIES:
Long-term debt		77,404			77,325
Income tax payable		571			563
Accrued severance pay		994			911
Deferred tax liabilities		56			46
Unearned interest income		1,376			1,355
Warranty accrual		432			508
Other long-term liabilities		567			348
Total long-term liabilities		81,400			81,056
TOTAL LIABILITIES		110,996			112,271
Commitments and Contingencies (Note 8)
STOCKHOLDERS’ EQUITY:
Common Stock, $0.0001 par value: 300,000,000 shares authorized as of March 31, 2022 and December 31, 2021; 63,999,044 and 63,982,580 issued and outstanding as of March 31, 2022 and December 31, 2021 respectively		27			27
Additional paid-in capital		221,787			221,321
Accumulated deficit		(189,024	)		(180,405	)
TOTAL STOCKHOLDERS’ EQUITY		32,790			40,943
Non-controlling interests		636			653
		33,426			41,596
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	144,422		$	153,867

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Table of Contents

VENUS CONCEPT INC.

Condensed Consolidated Statements of Operations

(Unaudited)

_{(in thousands, except for per share data)}

	*Three Months Ended March 31,*
	*2022*		*2021*
Revenue
Leases	$	10,423	$	8,537
Products and services		15,983		14,060
		26,406

SEC Form 10-Q filed by Venus Concept Inc.