In This Article:
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Delcath Systems Inc (NASDAQ:DCTH) reported a strong revenue growth in Q1 2025, with a combined revenue of $19.8 million from PepSAo and Kemos, marking a significant increase from the previous year.
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The company achieved a positive net income of $1.1 million and positive cash flow from operations of $2.2 million, indicating solid financial health.
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Delcath Systems Inc (NASDAQ:DCTH) expanded its network to 19 active centers in the US, with plans to reach 30 by the end of the year, demonstrating successful market penetration.
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The company ended the quarter with no debt and approximately $59 million in cash and investments, providing a strong financial foundation for future growth.
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The European market saw a 29% increase in revenue over the prior quarter, highlighting growth potential despite existing reimbursement challenges.
Negative Points
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Despite the revenue growth, the European market faces significant reimbursement and pricing challenges, limiting its contribution to overall revenue in the short to medium term.
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The process of activating new centers is complex and can be unpredictable, with potential barriers that could slow down the pace of expansion.
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Research and development expenses increased to $5 million in Q1 2025 from $3.7 million in the same period the previous year, reflecting higher costs associated with ongoing trials.
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The company anticipates a decrease in average monthly treatments per site for the remainder of the year, which could impact revenue growth.
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There is uncertainty regarding the timing of site activations and patient enrollments for new clinical trials, which could delay potential revenue from these initiatives.
Q & A Highlights
Q: Can you provide an update on the expected number of new center activations for the year? A: Gerard Michel, CEO: We anticipate a more even distribution of center activations throughout the year than initially expected. We are targeting around 30 active centers by year-end, with the possibility of adding 2 to 3 more centers in Q2.
Q: What is the expected frequency of treatments per patient, and how does this impact revenue? A: Gerard Michel, CEO: The average number of treatments per patient is around 4.1, similar to clinical trial results. This frequency is a significant driver of revenue, and we expect it to remain consistent.
Q: How do you plan to manage operating expenses and EBITDA as trials ramp up? A: Sandra Pennell, CFO: We expect operating expenses to increase, with SG&A rising by about 60% and R&D by 150% over 2024 levels. Despite this, we aim to remain EBITDA positive for the year.