Le Lézard
Classified in: Health, Science and technology, Business
Subjects: ERN, CCA, FVT

INVO Bioscience Reports Third Quarter 2019 Financial Results


SARASOTA, Fla., Nov. 14, 2019 /PRNewswire/ -- INVO Bioscience, Inc. (OTCQB: IVOB), a medical device company focused on creating alternative treatments for patients diagnosed with infertility and developers of INVOcell®, the world's only in vivo Intravaginal Culture System, today announced financial results for the third quarter of 2019, ended September 30, 2019.

We are a medical device company focused on creating simplified, lower cost treatments for patients diagnosed with infertility. Our solution, the INVO Procedure, is a disruptive new technology. The INVO Procedure is a revolutionary in vivo method of vaginal incubation that offers patients a more natural and intimate experience.

Q3 2019 Financial Results:

International Expansion Highlights

Management Discussion

Steve Shum, Chief Executive Officer of INVO Bioscience, commented, "We are excited with the progress being made to drive revenue growth domestically through our U.S. commercialization agreement with Ferring and now in other parts of the world with the recent signing of new commercial distribution agreements for Nigeria, Turkey, Jordan, Uganda, Ethiopia, and Sudan. We believe there is an incredible opportunity to drive adoption of the INVOcell over the coming years through the creation of commercialization agreements with partners. We will remain diligent to find partners that are incentivized to support the product through minimum purchase requirements or similar arrangements. Our agreement with Ferring for the U.S. and our recent agreements for Africa and Eurasia are great templates to continue working from and we look forward to further agreements announced in the future."

Shum continued, "Other near-term objectives include the initiation of our follow-on clinical study for the INVOcell device to expand the current label from a 3-day incubation period to a 5-day incubation period. As part of the Ferring agreement, if we achieve 5-day labeling approval from the FDA, we receive an additional $3 million non-dilutive milestone payment. In addition to the milestone payment, the new study will allow us to update our clinical data which we believe will allow us to show improved clinical pregnancy and birth rates and further enhance the value proposition we can provide to the market as an alternative to traditional IVF."

"Our technology is a simple and more natural solution, with comparable rates of effectiveness to existing options at lower costs, that has been designed to help the millions of couples worldwide that struggle with infertility but are currently unable to receive treatment. We are beginning to put in place the commercialization strategy that can allow for the proliferation of this technology which I believe has the ability to significantly enhance shareholder value," concluded Shum.

Financial Results

Revenue for the three months ended September 30, 2019, was $303,571 compared to $125,035 for the same three-month period in 2018, an increase of $178,536 or approximately 143%.  The increase was primarily the result of increased product sales as Ferring began to increase their marketing activities as well as from recognizing 3.6% of the Ferring seven-year U.S. exclusive licensing & distribution fee.    

Gross margin reported for the third quarter ended September 30, 2019 was approximately 85% or $258,645 compared to 88% or $109,666 for the three months ended September 30, 2018. The slight decrease in gross margin relates to the lower average selling price on product sales as compared to last year, due to the fixed price the Company now sells to Ferring under the agreement, which was partly offset by the amortization of the up-front license payment. 

Selling, general and administrative expenses for the three months ended September 30, 2019 were $891,008 as compared to $299,548 for the three months ended September 30, 2018, an increase of $591,460 or 197%. The increase in SG&A during the third quarter of 2019 compared to the third quarter of 2018 was primarily the result of an increase in wages, professional fees, legal fees (including certain one-time settlement costs totaling $180,000) and other corporate expenses, part of which are associated with our plans to accelerate our various commercialization efforts.

During the three-month period ended September 30, 2019 we incurred $47,462 in interest expense, a decrease of $57,516, or 55%, compared to $104,978 in the three-month period ended September 30, 2018. The primary reason for the decrease in 2019 was the amortization of discount on the 2018 Convertible Notes Payable in the amount of $40,355 as compared to $79,771 during the same period of 2018.

Net loss of $710,334, or $(0.00) per basic and diluted share for the three months ended September 30, 2019 compared to a net loss of $294,860, or $(0.00) per basic and diluted share for the three months ended September 30, 2018.

Webcast

The Company will hold a live investor webcast next week to discuss the results and provide investors an overview of the Company and its strategy.

Date and Time: 11:00am ET (8:00am PT) on Thursday, November 21, 2019.

Live Webcast Information: Interested parties can access the conference call via a live Internet webcast, which is available in the Investor Relations section of the Company's website at https://invobioscience.com/investors/.

Questions: The webcast will be moderated by Lytham Partners. To submit a question in advance of the webcast, please email it to [email protected].

Replay: A webcast replay will be available for 90 days in the Investor Relations section of the Company's website at https://invobioscience.com/investors/.

About INVO Bioscience

We are a medical device company focused on creating simplified, lower cost treatments for patients diagnosed with infertility. Our solution, the INVO Procedure, is a disruptive new technology. The INVO Procedure is a revolutionary in vivo method of vaginal incubation that offers patients a more natural and intimate experience. Our lead product, the INVOcell, is a patented medical device used in infertility treatment and is considered an Assisted Reproductive Technology (ART). The INVOcell is the first Intravaginal Culture (IVC) system in the world used for the natural in vivo incubation of eggs and sperm during fertilization and early embryo development, as an alternative to traditional In Vitro Fertilization (IVF) and Intrauterine Insemination (IUI). Our mission is to increase access to care and expand fertility treatment across the globe with a goal to lower the cost of care and increase availability of care. For more information, please visit http://invobioscience.com/

Safe Harbor Statement

This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company invokes the protections of the Private Securities Litigation Reform Act of 1995. All statements regarding our expected future financial position, results of operations, cash flows, financing plans, business strategies, products and services, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include words such as "anticipate," "if," "believe," "plan," "estimate," "expect," "intend," "may," "could," "should," "will," and other similar expressions are forward-looking statements. All forward-looking statements involve risks, uncertainties and contingencies, many of which are beyond our control, which may cause actual results, performance, or achievements to differ materially from anticipated results, performance, or achievements. Factors that may cause actual results to differ materially from those in the forward-looking statements include those set forth in our filings at www.sec.gov. We are under no obligation to (and expressly disclaim any such obligation to) update or alter our forward-looking statements, whether as a result of new information, future events or otherwise.

For more information, please contact:

INVO Bioscience
Steve Shum, CEO
978-878-9505
[email protected]  

Investors
Lytham Partners, LLC
Robert Blum
602-889-9700
[email protected]

 

INVO BIOSCIENCE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS







September 30,


December 31,


2019


2018

ASSETS

(unaudited)



Current Assets




Cash

$           2,009,679


$             212,243

Accounts receivable, net

27,021


225,899

Inventory, net

69,330


43,513

Prepaid expenses and other current assets

197,583


249,454

   Total Current Assets

2,303,613


731,109





Property and equipment, net

95,582


34,446





Other Assets




Capitalized patents, net

8,368


11,792

Leasehold right of use, net

107,374


-

Trademarks

49,867


-

Total other assets

165,609


11,792





Total assets

$           2,564,804


$             777,347





LIABILITIES AND STOCKHOLDERS' DEFICIENCY




Current liabilities




Accounts payable and accrued liabilities, including related parties

$              457,413


$             571,828

Accrued compensation

948,423


2,515,256

Deferred revenue

727,261


18,895

Current portion of leasehold liability

21,029


-

Note payable

-


131,722

Note payable - related party

-


97,743

Convertible notes, net of discount

-


157,039

Convertible notes, net of discount - related party

-


9,087

Income Taxes Payable

30,509


-

Total current liabilities

2,184,635


3,501,570





Commitments and contingencies (Note 12)

-


-





Leasehold liability

86,955


-

Deferred revenue

3,750,000


-

Convertible notes, net of discount

279,372


-

Convertible notes, net of discount - related party

24,448


-





Total liabilities

6,325,410


3,501,570





Stockholders' Deficiency




Preferred Stock, $.0001 par value; 100,000,000 shares authorized; No shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively

-


-

Common Stock, $.0001 par value; 200,000,000 shares authorized; 155,996,112 and 154,292,497 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively

15,559


15,429

Additional paid-in capital

19,355,513


18,981,571

Accumulated deficit

(23,131,678)


(21,721,222)

Total stockholders' deficiency

(3,760,606)


(2,724,222)





Total liabilities and stockholders' deficiency

$           2,564,804


$             777,348

 

INVO BIOSCIENCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)










For the Three


For the Three


For the Nine


For the Nine


Months Ended


Months Ended


Months Ended


Months Ended


September 30,


September 30,


September 30,


September 30,


2019


2018


2019


2018









Revenue:








Product Revenue

$              125,000


$              125,035


$              615,927


$              339,385

License Revenue

178,571


-


535,714


-









Total Revenue

303,571


125,035


1,151,641


339,385









Cost of Goods Sold

44,926


15,369


111,186


46,503









Gross Profit

258,645


109,666


1,040,455


292,882









Selling, general, and administrative expenses

891,008


299,548


2,087,725


2,413,493

Total operating expenses

891,008


299,548


2,087,725


2,413,493









Loss from operations

(632,363)


(189,882)


(1,047,270)


(2,120,611)









Other (income) expense:








Interest (income) expense

47,462


104,978


332,677


184,100

Total other (income) expenses

47,462


104,978


332,677


184,100









Loss before income taxes

(679,825)


(294,860)


(1,379,947)


(2,304,711)









Provision for income taxes

(30,509)


-


(30,509)


-









Net Loss

$             (710,334)


$             (294,860)


$          (1,410,456)


$          (2,304,711)









Basic net loss per weighted average shares of common stock

$                   (0.00)


$                   (0.00)


$                   (0.01)


$                   (0.02)









Diluted net loss per weighted average shares of common stock

$                   (0.00)


$                   (0.00)


$                   (0.01)


$                   (0.02)









Basic weighted average number of shares of common stock

155,564,047


147,454,700


155,106,340


146,052,444









Diluted weighted average number of shares of common stock

155,564,047


147,454,700


155,106,340


146,052,444

 

INVO BIOSCIENCE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)






For the Nine


For the Nine


Months Ended


Months Ended


September 30,


September 30,


2019


2018

Cash flows from operating activities:




Net Loss

$             (1,410,456)


$             (2,304,711)

Adjustments to reconcile net loss to net cash provided by operating activities:




Non-cash stock compensation issued for services

36,600


1,743,464

Stock issued for settlement of legal dispute

93,750


-

Amortization of discount on notes payable

297,058


136,217

Amortization of leasehold right of use asset

9,067


-

Depreciation and amortization

7,126


3,663

Changes in assets and liabilities:




Accounts receivable

198,878


(100,444)

Inventories

(25,817)


8,277

Prepaid expenses and other current assets

56,871


110,133

Accounts payable and accrued expenses

20,498


(164,847)

Leasehold liability

(8,456)


-

Deferred revenue

4,458,366


-

Accrued interest

(55,553)


-

Accrued compensation

(1,566,834)


201,600

Income taxes payable

30,509


-

Net cash provided by (used in) operating activities

2,141,607


(366,648)





Cash from investing activities:




Payments to acquire property, plant, and equipment

(64,839)


-

Payments to acquire trademarks

(49,867)


-

Net cash used in investing activities

(114,706)


-





Cash from financing activities:




Proceeds from the sale of common stock

-


47,000

Proceeds from the sale of common stock - related parties

-


30,000

Proceeds from convertible notes payable

-


855,000

Proceeds from convertible notes payable - related parties

-


40,000

Principal payment on notes payable

(131,722)


-

Principal payment on notes payable - related parties

(97,743)


(83,145)

Net cash provided by (used in) financing activities

(229,465)


888,855





Increase in cash and cash equivalents

1,797,436


522,207





Cash and cash equivalents at beginning of period

212,243


25,759





Cash and cash equivalents at end of period

$               2,009,679


$                  547,966





Supplemental disclosure of cash flow information:








Cash paid during the period for:




Interest

$                    84,043


$                      6,071





Taxes

$                         912


$                      3,648





Leasehold right of use asset and leasehold liability upon adoption of ASU 2016-02, lease (Topic 842)

$                  116,441


$                              -





Common stock issued upon note payable and accrued interest conversion

$                  238,723


$                              -





Common stock issued for prepaid services

$                      5,000


$                  153,000





Beneficial conversion feature on convertible notes

$                              -


$                  895,000

 

SOURCE INVO Bioscience, Inc.


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