MALVERN, Pa. - TELA Bio (NASDAQ:TELA), Inc., a medical technology company specializing in soft-tissue reconstruction solutions, has launched a public offering of its common stock and pre-funded warrants. The offering includes an option for underwriters to purchase additional securities, which could expand the total investment opportunity by 15%.
The company, which has not confirmed the completion date or the terms of the offering, stated that the proceeds would be used for a variety of corporate purposes. These include sales and marketing efforts, research and development activities, general administrative expenses, working capital, and capital expenditures.
Joint bookrunners for the offering are Canaccord Genuity and Lake Street Capital Markets. The offering is being conducted under a shelf registration statement that was declared effective by the SEC on November 20, 2023.
TELA Bio has emphasized that the offering is subject to market conditions and other factors, and there is no certainty regarding the offering's completion or its final size and terms.
This announcement is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities. The sale of these securities will not be lawful in any jurisdiction where such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of that state or jurisdiction.
The company's approach to medical technology focuses on optimizing clinical outcomes by prioritizing the preservation and restoration of the patient's own anatomy, aiming to minimize long-term exposure to permanent synthetic materials.
Investors are advised that the press release contains forward-looking statements that involve risks and uncertainties, including those related to market conditions and the proposed public offering. These statements are not guarantees of future performance and actual results may differ materially from those projected. Further details can be found in the "Risk Factors" section of the preliminary prospectus supplement filed with the SEC and in TELA Bio's other SEC filings.
In other recent news, TELA Bio reported an 11% year-over-year revenue growth in its second quarter, reaching $16.1 million, despite cybersecurity incidents that negatively affected sales. The company projects its annual sales to be between $74.5 million and $76.4 million, indicating a growth of 27.5% over the previous year. TELA Bio also expects lower operating and net losses in 2024 compared to 2023, with steady or slightly lower operating expenses and reduced cash consumption in the latter half of the year.
Analysts from Canaccord Genuity and Piper Sandler have maintained their positive ratings on TELA Bio shares, despite adjusting their price targets. Canaccord Genuity's outlook is based on the potential for increased adoption of TELA's OviTex hernia mesh products, while Piper Sandler highlighted the company's unique technology and strong international performance.
In addition, TELA Bio has introduced a new inguinal hernia repair product line, aiming to capture a broader market segment. These recent developments and analyst adjustments follow TELA Bio's second-quarter earnings report. Despite facing challenges, including cyberattacks and changes in physician staff, the company is optimistic about its future performance and growth.
InvestingPro Insights
TELA Bio's recent public offering announcement comes at a time when the company faces significant financial challenges. According to InvestingPro data, TELA Bio has a market capitalization of $61.54 million, reflecting its relatively small size in the medical technology sector. The company's revenue for the last twelve months as of Q2 2023 stood at $64.74 million, with a notable revenue growth of 31.64% over the same period.
Despite this growth, TELA Bio is currently unprofitable, with an adjusted operating income of -$46.44 million for the last twelve months. This aligns with an InvestingPro Tip indicating that the company is not expected to be profitable this year. The company's rapid cash burn rate, another InvestingPro Tip, further underscores the importance of the current public offering in securing additional funding for its operations and growth initiatives.
The stock's performance has been challenging, with a significant price decline of 44.59% over the past three months. This downturn is reflected in an InvestingPro Tip highlighting that the stock has taken a substantial hit over the last six months. However, it's worth noting that TELA Bio's liquid assets exceed its short-term obligations, providing some financial flexibility.
For investors seeking a more comprehensive analysis, InvestingPro offers 9 additional tips for TELA Bio, which could provide valuable insights into the company's financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.