Meeting room with Laptop Computer Boardroom Interior Business concept

Toronto, Ontario – May 3, 2017 – NOVADAQ Technologies Inc (NASDAQ:NVDQ; TSX:NDQ), the leading provider of proven comprehensive fluorescence imaging solutions that improve clinical outcomes and reduce healthcare costs in minimally invasive and open surgeries today reported financial results for the three months ended March 31, 2017. Unless otherwise indicated, all dollar amounts in this press release are expressed in United States (“U.S.”) dollars.

Recent Highlights

  • First quarter revenue of $21.1 million, an increase of 19% from the first quarter of 2016.
    • Recurring revenues in the first quarter were $10.0 million, representing a 43% year-over-year increase.
  • Procedures performed using SPY technology systems during the first quarter were approximately 16,000 representing an increase of 30% year-over-year.
  • Completed enrollment of the FILM trial, a study assessing the safety and utility of lymph node mapping with the PINPOINT system in patients with uterine and cervical cancers. Initial results to be presented before the end of the year.
  • Introduced the SPY PHI Open Surgery Handheld Fluorescence Imaging System at the Society of American Gastrointestinal and Endoscopic Surgeons.


The following table sets out certain quarterly revenue and installed base metrics:


Q1-2017    Q1-2016 Change
Recurring $ 10.0 $ 7.0   43%
Capital    6.9  7.6   (9%)
Total Direct  16.9  14.6 16%
Indirect (Partners/International Distributors)    4.2    3.1   33%
Total $21.1 $17.7   19%


Direct Systems 988  760 30%
Recurring Revenue/Direct System $10,075 $9,153 10%

“Results of the first quarter were in-line with our expectations and reflect continued solid execution and strong demand for our SPY fluorescence imaging technology,” said Rick Mangat, NOVADAQ’s President and Chief Executive Officer. “We are encouraged by the early traction we are seeing with the shift in focus towards recurring revenue in our sales model. I believe we have only penetrated a small portion of our potential global customer base.”

First Quarter Financial Results

For the three months ended March 31, 2017 NOVADAQ reported revenues of $21.1 million, compared to $17.7 million in the first quarter of 2016.  Total direct sales increased by $2.3 million, or 16%, and total Partnered/International sales increased by $1.1 million, or 33%, compared to Q1-2016.

First quarter 2017 gross profits increased to $14.2 million (67% margin) compared to gross profits of $12.7 million (71%) in the same period last year.  The decrease in gross profit percentage was due to a shift in revenues from capital sales to recurring revenue.  The increase in recurring revenue was mainly driven by higher tissue sales which earns a lower margin than capital sales.

Net loss for the first quarter of 2017 was $14.1 million, or $0.24 basic loss per share, compared with net loss of $7.0 million, or $0.12 basic loss per share, in the first quarter of 2016.  The increase in net loss was primarily a result of higher operating expenses of $7.1 million, non-cash warrant revaluation income of $1.3 million in the first quarter of 2016, and higher finance costs $0.3 million, partially offset by an increase in gross profit of $1.6 million.

First quarter 2017 operating burn (cash consumed by operating activities before changes in working capital) was $10.7 million compared to $5.5 million in the first quarter 2016. The difference to operating burn was mainly driven by increased operating expenses associated with the continued build-out of NOVADAQ’s direct sales and marketing infrastructure. During the first quarter of 2017, non-cash working capital decreased by $2.2 million.

2017 Financial Guidance

NOVADAQ continues to expect full year 2017 revenue to be in the range of $98 to $102 million, representing growth in the range of 22% to 27% year-over-year. The Company anticipates recurring revenues for the full year to be in the range of $48 to $50 million, reflecting growth of 45% to 51% year-over-year. Gross margins are expected to be in the range of 65% to 70% for the full year 2017.

Webcast and Conference Call Information

NOVADAQ’s management team will host a conference call today beginning at 1:30 p.m. PT / 4:30 p.m. ET. Investors interested in listening to the conference call may do so by calling 877-407-8031 (within Canada and the U.S.) or 201-689-8031 outside Canada and the U.S.) or from the webcast on the “Investor Relations” section of the Company’s website at:

A replay of the call will be available for 48 hours by calling (877) 481-4010 (within Canada and the U.S.) or (919) 882-2331 (outside Canada and the U.S.), using Conference ID:10307. The call will also be archived on the NOVADAQ website.

About NOVADAQ Technologies Inc. 

NOVADAQ’s global mission is to enable physicians with point-of-care imaging solutions that provide real-time clinically significant and actionable information to improve care quality and lower healthcare costs. Using NOVADAQ’s SPY fluorescence imaging technology, physicians can personalize therapy and achieve optimal results through the precise visualization of blood flow in vessels, micro-vessels, tissue perfusion and critical anatomical structures during the course of treatment. SPY technology enables the delivery of personalized therapies and the achievement of the optimal results for each individual patient. More than 250 peer-reviewed publications demonstrate that the use of SPY technology will reduce post-procedure complication rates and the cost of care for a broad variety of surgical treatments for cancer, cardiovascular diseases and other conditions, helping to ensure that patients benefit from the very best possible treatment and outcome.

SPY Imaging Systems are U.S. Food and Drug Administration 510(k) cleared, Health Canada licensed, CE Marked and registered worldwide for use in multiple surgical specialties and medical applications. The endoscopic version of SPY technology, known as PINPOINT, combines the fluorescence imaging capabilities of SPY with the high definition visible light visualization to establish a new standard in the quality and performance of minimally invasive surgery. The SPY PHI open surgery portable, handheld imager is FDA (510)k cleared and CE Marked and is indicated for the visualization of blood flow and tissue perfusion in plastic, reconstructive, micro and gastrointestinal surgeries. NOVADAQ’s LUNA System is used to visualize blood flow and tissue perfusion while treating patients with atherosclerotic cardiovascular disease that impairs blood flow to the extremities and increases the risk for the development of complications such as acute and chronic non-healing wounds and limb loss. NOVADAQ is the exclusive worldwide distributor of LifeNet Health’s DermACELL acellular tissue products for wound and breast reconstruction surgery

Forward-Looking Statements

Certain statements included in this press release may be considered forward-looking. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements, and therefore these statements should not be read as guarantees of future performance or results. All forward-looking statements are based on NOVADAQ’s current beliefs as well as assumptions made by and information currently available to NOVADAQ and relate to, among other things, the Company’s strategy, strategic goals, research and development activities, research and clinical testing outcomes, taxes, capital expenditures, future operations, future financial position, future revenues/results, projected costs, prospects and plans and objectives of management.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Due to risks and uncertainties, including the risks and uncertainties identified by NOVADAQ in its public securities filings available at and, actual events may differ materially from current expectations. NOVADAQ disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

NOVADAQ, SPY, PINPOINT, LUNA and the illumination square design are registered trademarks of NOVADAQ Technologies, Inc. SPY PHI is a trademark of NOVADAQ Technologies, Inc. DermACELL is a registered trademark of LifeNet Health, Inc.

For more information, please contact:

Lynn Pieper Lewis or Leigh Salvo

(415) 937-5404


Novadaq Technologies Inc.



(expressed in U.S. dollars, except common shares outstanding)

      As at

March 31, 2017

    As at

December 31, 2016

Current assets  
Cash and cash equivalents $   56,139,164    $ 62,382,649
Accounts receivable   28,430,680   27,791,574
Prepaid expenses and other assets   5,767,149   5,776,463
Inventories   4,644,628   4,295,565
        94,981,621   100,246,251
Non-current assets        
Long-term receivables     961,341   298,073
Other assets     398,676  
Investments     289,284  
Property and equipment, net   19,627,354   19,508,471
Intangible assets, net   16,665,216   16,847,287
Total Assets   $   132,923,492    $ 136,900,082
Current liabilities        
Accounts payable and accrued liabilities $   17,373,654    $ 19,223,889
Provisions   438,121   510,203
Deferred revenue   2,837,372     2,156,096
Income taxes payable   24,033     24,433
Distribution rights payable   250,000     250,000
Other liabilities   489,212     445,252
      21,412,392     22,609,873
Non-current liabilities          
Deferred revenue   617,538     729,209
Distribution rights payable   1,353,025     1,581,127
Long-term debt   9,617,245    
Total Liabilities   $   33,000,200    $ 24,920,209
Shareholders’ Equity          
Share capital $   340,224,517    $ 337,974,247
Contributed surplus     22,842,855   23,042,165
Deficit     (263,144,080) (249,036,539)
Total Shareholders’ Equity   $   99,923,292    $ 111,979,873
Total Liabilities and Shareholders’ Equity   $   132,923,492    $ 136,900,082
Total number of common shares outstanding       57,802,861   57,445,151


Novadaq Technologies Inc.



(expressed in U.S. dollars)


For the three months ended  
      March 31, 2017     March 31, 2016  
Product sales $   19,167,044   $ 16,779,708
Royalty revenue   525,750     495,250
Service revenue   1,382,459     451,113
Total revenues     21,075,253     17,726,071
Cost of sales     6,849,840     5,068,043
Gross profit     14,225,413     12,658,028
Selling and distribution expenses   21,264,284     15,308,081
Research and development expenses   3,924,099     3,163,368
Administrative expenses   2,911,640     2,556,259
Total operating expenses     28,100,023     21,027,708
Loss from operations     (13,874,610)     (8,369,680)
Finance costs   (285,922)     (24,028)
Finance income   52,991     89,681
Warrants revaluation adjustment       1,324,293
Net loss and comprehensive loss for the period   $   (14,107,541)   $ (6,979,734)
Basic loss and comprehensive loss per share for the period $   (0.24)   $ (0.12)
Diluted loss and comprehensive loss per share for the period $   (0.24)   $ (0.14)


Novadaq Technologies Inc.




(expressed in U.S. dollars)

For the three months ended  
          March 31, 2017     March 31, 2016  
 Net loss and comprehensive loss for the period $   (14,107,541)   $ (6,979,734)
 Items not affecting cash          
 Depreciation of property and equipment   2,054,049     1,311,122
 Amortization of intangible assets   423,199     436,402
 Stock-based compensation   867,194     1,047,343
 Amortization of deferred financing costs   41,126    
 Imputed interest on distribution rights payable   21,898     24,028
 Imputed interest on long-term receivables   (22,342)    
 Shareholder warrants revaluation adjustment       (1,324,293)
  (10,722,417)     (5,485,132)
 Changes in non-cash working capital          
 Increase in accounts receivable   (639,106)     (8,083)
 Increase in inventories   (349,063)     (1,013,329)
 Decrease in accounts payable and accrued liabilities and


  (1,929,033)     (1,951,375)
 Decrease in income taxes payable   (400)     (10,900)
 Decrease in prepaid expenses and other assets   9,314     336,598
 Increase in deferred revenue   681,276     367,683
 Net change in non-cash working capital balances related to operations   (2,227,012)     (2,279,406)
 Increase in long-term receivables   (640,926)    
 (Decrease) increase in non-current deferred revenue   (111,671)     50,666
 Cash used in operating activities     (13,702,026)     (7,713,872)
 Addition of property and equipment   (2,977,036)     (2,774,422)
 Purchase of intangible assets   (241,128)    
 Disposal of property and equipment   804,104     512,596
 Purchase of investments   (289,284)    
 Cash used in investing activities     (2,703,344)     (2,261,826)
 Net proceeds from the issuance of debt     9,177,443    
 Proceeds from exercise of options   1,227,726     37,533
 Payment of distribution rights payable   (250,000)     (250,000)
 Cash provided by (used in) financing activities     10,155,169     (212,467)
 Net decrease in cash and cash equivalents   (6,250,201)     (10,188,165)
 Net foreign exchange difference   6,716     5,951
 Cash and cash equivalents at beginning of period   62,382,649     106,790,202
 Cash and cash equivalents at end of period   $   56,139,164   $ 96,607,988