Venus Concept Inc. (NASDAQ:VERO), a medical technology company specializing in devices for the aesthetic market, has secured an additional $1 million in bridge financing, as per the latest 8-K filing with the Securities and Exchange Commission.
The company, which underwent a name change from Restoration Robotics , Inc. in 2017, entered into a Loan and Security Agreement with Madryn Health Partners, LP, and Madryn Health Partners (Cayman Master), LP, on April 23, 2024, for a term loan facility of up to $5 million.
The recent transaction, referred to as the September Drawdown, was fully funded on September 11, 2024, and follows a previous drawdown of $1 million on July 26, 2024.
The initial drawdown of approximately $2.24 million occurred concurrently with the signing of the agreement. The bridge financing carries an annual interest rate of 12%, and the loan is secured by a priority interest in all real and personal property collateral of Venus Concept and its subsidiaries.
Venus Concept plans to utilize the proceeds from the September Drawdown for general working capital purposes, after covering transaction expenses. The company has not disclosed specific details regarding the allocation of funds or future financial strategies related to the bridge financing.
The Loan and Security Agreement stipulates that on the maturity date, Venus Concept is obligated to repay all unpaid principal and accrued interest. The financial arrangement is part of the company's broader efforts to manage its capital needs and sustain operations.
In other recent news, Venus Concept Inc. reported its Second Quarter 2024 financial results, noting a 17% year-over-year decrease in revenue, down to $16.6 million, slightly exceeding expectations.
Despite this decrease, the company has made strides in its restructuring initiatives, achieving a 37% reduction in cash used in operations and a 39% reduction in total debt. A new in-house financing program, Venus Prime, has been well received in North America, replacing the legacy subscription model.
However, international revenue fell by 29% due to strategic restructuring and fluctuating ordering patterns from new distribution partners. The company also reported a net loss attributable to stockholders of $20 million, up from $7.4 million the previous year.
Looking ahead, Venus Concept is not providing full-year financial guidance but expects revenue of at least $17 million for Q3 2024. The company is working on cost reduction and cash management initiatives to accelerate long-term growth and profitability, with a focus on a strategic mix of 70% cash system sales and 30% lease sales.
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