Burning Rock Reports Third Quarter 2022 Financial Results

GUANGZHOU, China, Nov. 15, 2022 (GLOBE NEWSWIRE) — Burning Rock Biotech Limited (NASDAQ: BNR and LSE: BNR, the “Company” or “Burning Rock”), an organization centered on the applying of subsequent technology sequencing (NGS) expertise within the area of precision oncology, immediately reported monetary outcomes for the three months ended September 30, 2022.

Recent Business Updates

• Corporate
  • Listed on the Main Market of the London Stock Exchange (the “LSE”) by the use of a direct itemizing on November 1, 2022, whereas Burning Rock’s ADSs will proceed to be listed and traded on the Nasdaq Global Market, with these ADSs being absolutely fungible with the ADSs listed on the LSE.
• Therapy Selection and Minimal Residual Disease (MRD)
  • In-hospital technique continues to drive progress uplift regardless of unfavourable Covid affect. In-hospital volumes grew 24% year-over-year within the third quarter of 2022.
  • MRD volumes proceed to ramp up following business launch in March 2022, with roughly 700 checks accomplished within the third quarter of 2022, greater than doubling the volumes within the second quarter of 2022.
• Early Detection
  • PROMISE examine (2,035 members) for 9-cancer check outcomes introduced at European Society for Medical Oncology (ESMO) Congress 2022 in September 2022. Overall sensitivity achieved 83.7% for 9 cancers at specificity of 98.3%, with methylation contributing majority of optimistic detections in comparison with protein and mutation. Tissue origin prediction accuracy achieved 90.9% for the highest 2 organs.
  • Commercialization of our blood-based, 6-cancer early detection check gaining preliminary traction, with product onboarding accomplished at just a few hospitals.
• Pharma Services
  • The whole worth of recent contracts we entered into from January to September 2022 amounted to RMB198 million, representing roughly 38% enhance from the identical interval of 2021.
  • Starting to work with BeiGene on preliminary medical research utilizing our personalised MRD check brPROPHET^TM .
  • New companion diagnostics (CDx) growth introduced with Eli Lilly and Company in China, for the RET inhibitor selpercatinib.

Third Quarter 2022 Financial Results

Revenues have been RMB154.6 million (US$21.7 million) for the three months ended September 30, 2022, representing a 22.1% enhance from RMB126.6 million for a similar interval in 2021.

• Revenue generated from central laboratory business was RMB90.0 million (US$12.7 million) for the three months ended September 30, 2022, representing a 14.2% enhance from RMB78.8 million for a similar interval in 2021, pushed by income enhance from monitoring packages that include a number of checks per bundle.
• Revenue generated from in-hospital business was RMB49.6 million (US$7.0 million) for the three months ended September 30, 2022, representing a 13.5% enhance from RMB43.7 million for a similar interval in 2021, primarily attributable to in-hosiptal gross sales quantity progress in Shanghai and Beijing as COVID affect lessened within the third quarter of 2022.
• Revenue generated from pharma analysis and growth companies was RMB15.0 million (US$2.1 million) for the three months ended September 30, 2022, representing a 267.4% enhance from RMB4.1 million for a similar interval in 2021, primarily attributable to elevated growth and testing companies carried out for our pharma prospects.

Cost of revenues was RMB46.0 million (US$6.5 million) for the three months ended September 30, 2022, representing a 31.5% enhance from RMB35.0 million for a similar interval in 2021, primarily as a result of a rise in testing and promoting quantity in addition to rental expense and renovation depreciation in relation to our new laboratory that commenced use in January 2022.

Gross revenue was RMB108.6 million (US$15.3 million) for the three months ended September 30, 2022, representing a 18.6% enhance from RMB91.6 million for a similar interval in 2021. Gross margin was 70.2% for the three months ended September 30, 2022, which decreased from 72.3% for a similar interval in 2021, primarily as a result of an elevated earnings from monitoring packages, offset by an elevated depreciation in relation to our new laboratory.

Non-GAAP gross revenue, which excludes depreciation and amortization bills, was RMB117.0 million (US$16.4 million) for the three months ended September 30, 2022, representing a 25.8% enhance from RMB93.0 million for a similar interval in 2021. Non-GAAP gross margin was 75.7% for the three months ended September 30, 2022, in comparison with 73.4% for a similar interval in 2021.

Operating bills have been RMB343.2 million (US$48.3 million) for the three months ended September 30, 2022, representing a 30.7% enhance from RMB262.6 million for a similar interval in 2021.

• Research and growth bills have been RMB109.4 million (US$15.4 million) for the three months ended September 30, 2022, representing a 57.2% enhance from RMB69.6 million for a similar interval in 2021, primarily as a result of (i) a rise in medical program bills for early most cancers detection; and (ii) a rise in amortized expense on share-based compensation, offset partly by a lower in workers value as a result of organizational restructuring.
• Selling and advertising bills have been RMB90.3 million (US$12.7 million) for the three months ended September 30, 2022, representing a 17.7% enhance from RMB76.7 million for a similar interval in 2021, primarily as a result of (i) a rise in workers value resulted from enhance in headcount; (ii) a rise in convention payment and (iii) a rise amortized expense on share-based compensation. Sequentially, promoting and advertising bills within the third quarter decreased by 14.5% in comparison with the second quarter of 2022, as our gross sales reorganization and working effectivity enchancment initiative began to generate preliminary outcomes. We will proceed to concentrate on enhancing working effectivity going ahead.
• General and administrative bills have been RMB143.5 million (US$20.2 million) for the three months ended September 30, 2022, representing a 23.4% enhance from RMB116.3 million for a similar interval in 2021, primarily as a result of (i) a rise in depreciation bills for a brand new constructing; (ii) a rise in allowance for credit score loss in relation to accounts receivables; and (iii) a rise amortized expense on share-based compensation.

Net loss was RMB231.5 million (US$32.5 million) for the three months ended September 30, 2022, in comparison with RMB170.5 million for a similar interval in 2021.

Net money utilized in working actions was RMB135.5 million (US$19.0 million) for the three months ended September 30, 2022, in comparison with RMB133.4 million for a similar interval in 2021. The steadiness of money, money equivalents, restricted money and short-term investments was RMB1,014.0 million (US$142.5 million) as of September 30, 2022.

Revised 2022 Financial Guidance

We imagine that we now have achieved sturdy, above-industry progress within the first 9 months of 2022, producing revenues of RMB421 million, a rise of 17% in comparison with the identical interval of 2021. This is beneath the implied full-year progress price of our preliminary steering at first of the 12 months, primarily as a result of an out-sized Covid affect in Shanghai within the second quarter and to a lesser extent, Covid-related disruptions in different areas of China now and again. We have noticed one other vital wave of Covid circumstances sweeping by many giant cities in China for the reason that begin of October, significantly in Guangzhou, which is certainly one of our key markets and the place our central lab is situated. We are taking a cautious view now and mission a drop in revenues within the fourth quarter compard to the identical interval final 12 months, which was a powerful quarter and comparatively free of huge Covid impacts. We due to this fact revise our 2022 full-year income steering to a progress of approxiately 5% in comparison with 2021.

Transition of Chief Operating Officer to Chief Scientific Officer

Effective November 2022, Shannon Chuai, our chief working officer, is taking up a brand new function of chief scientific officer of Burning Rock. In her new function, Shannon will lead key tasks of our pipeline growth, present senior oversight on our early most cancers detection medical applications and our engagement on product registration with the NMPA and different medical regulatory our bodies. Shannon continues to function a director on our board. The firm’s respective business items will report on to our CEO, Yusheng Han.

Conference Call Information

Burning Rock will host a convention name to debate the third quarter 2022 monetary outcomes at 8:30 a.m. U.S. Eastern Time (9:30 p.m. Hong Kong time) on November 16, 2022.

Please register upfront of the convention utilizing the hyperlink offered beneath and dial in quarter-hour previous to the decision, utilizing participant dial-in numbers and distinctive registrant ID which might be offered upon registering.

PRE-REGISTER LINK: https://register.vevent.com/register/BI96c581babaf44021ab6c34af9f7ce42b.

Additionally, a reside and archived webcast of the convention name can even be accessible on the corporate’s investor relations web site at http://ir.brbiotech.com or by hyperlink https://edge.media-server.com/mmc/p/8fj2edsi.

A replay of the webcast shall be accessible for 12 months through the identical hyperlink above.

About Burning Rock

Burning Rock Biotech Limited (NASDAQ: BNR; LSE: BNR), whose mission is to protect life through science, focuses on the applying of subsequent technology sequencing (NGS) expertise within the area of precision oncology. Its business consists of i) NGS-based remedy choice testing for late-stage most cancers sufferers, and ii) most cancers early detection, which has moved past proof-of-concept R&D into the medical validation stage.

For extra details about Burning Rock, please go to: ir.brbiotech.com.

Safe Harbor Statement

This press launch incorporates forward-looking statements. These statements represent “forward-looking” statements inside the that means of Section 21E of the Securities Exchange Act of 1934, as amended, and as outlined within the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements could be recognized by terminology corresponding to “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “target,” “confident” and related statements. Burning Rock can also make written or oral forward-looking statements in its periodic stories to the SEC, in its annual report back to shareholders, in press releases and different written supplies and in oral statements made by its officers, administrators or staff to 3rd events. Statements that aren’t historic information, together with statements about Burning Rock’s beliefs and expectations, are forward-looking statements. Such statements are based mostly upon administration’s present expectations and present market and working situations, and relate to occasions that contain recognized or unknown dangers, uncertainties and different elements, all of that are tough to foretell and plenty of of that are past Burning Rock’s management. Forward-looking statements contain dangers, uncertainties and different elements that might trigger precise outcomes to vary materially from these contained in any such statements. All info offered on this press launch is as of the date of this press launch, and Burning Rock doesn’t undertake any obligation to replace any forward-looking assertion on account of new info, future occasions or in any other case, besides as required underneath relevant regulation.

Non-GAAP Measures

In evaluating the business, the corporate considers and makes use of non-GAAP measures, corresponding to non-GAAP gross revenue and non-GAAP gross margin, as supplemental measures to evaluate and assess working efficiency. The presentation of those non-GAAP monetary measures isn’t meant to be thought of in isolation or as an alternative to the monetary info ready and introduced in accordance with accounting rules typically accepted within the United States of America (“U.S. GAAP”). The firm defines non-GAAP gross revenue as gross revenue excluding depreciation and amortization. The firm defines non-GAAP gross margin as gross margin excluding depreciation and amortization.

The firm presents these non-GAAP monetary measures as a result of they’re utilized by administration to judge working efficiency and formulate business plans. The firm imagine non-GAAP gross revenue and non-GAAP gross margin excluding non-cash affect of depreciation and amortization replicate the corporate’s ongoing business operations in a way that permits extra significant period-to-period comparisons.