NORWELL, Mass., Feb. 14, 2025 (GLOBE NEWSWIRE) -- DIH Holding US, Inc. ("DIH")(NASDAQ:DHAI), a global provider of advanced robotic devices used in physical rehabilitation, which incorporates visual stimulation in an interactive manner to enable clinical research and intensive functional rehabilitation and training in patients with walking impairments, reduced balance and/or impaired arm and hand functions, today announced financial results for the third fiscal quarter ended December 31, 2024.
Recent Highlights
- Revenue of $15.1 million for the quarter ended December 31, 2024, representing a decline of 21% over the prior year period
- Device revenue of $11.7 million and service revenue of $3.1 million for the quarter ended December 31, 2024, representing a decline of 26% and growth of 4%, respectively, over the prior year period
- Revenue decline in Europe, Middle East and Africa (EMEA) and the Americas of 29% and 7%, respectively, over the prior year period
- Announced collaborations with Nobis Rehabilitation Partners and Zahrawi Group, expanding our distribution network and device integration pipeline
- Closed on a public offering yielding gross proceeds of approximately $4.6 million before deducting placement agent's fees other offering expenses
- Reiterated revenue guidance for the fiscal year 2025 to range between $60 and $67 million
"Our third quarter results were in line with our expectations despite facing challenges with import restrictions related to the ongoing conflict between Russia and Ukraine and lower overall European sales volumes. We continue to position the company for future success through upgrades to our commercial organizations while also remaining focused on reaching our year-end revenue targets," said Jason Chen, Chairman and CEO of DIH. "Interest in our products remains high, as evidenced by multiple recently formed partnerships, and the recent stock offering will enable us to continue working towards fulfilling this order demand. We remain confident for a strong finish through the remainder of fiscal year 2025 and are reiterating our full year revenue guidance range of $60 to $67 million."
Financial Results for the Third Fiscal Quarter Ended December 31, 2024
Revenue for the three months ended December 31, 2024 decreased by $3.9 million, or 20.6%, to $15.1 million from $19.0 million for the three months ended December 31, 2023. The overall decrease was primarily due to a decrease in devices sold of $4.0 million, or 25.6% year over year. The decrease in devices revenue was primarily driven by lower sales volume in EMEA. In EMEA, we sell our equipment through a distributor network across Europe. One of our largest sales partners, which primarily operates in Eastern Europe, has been impacted by wartime import restrictions resulting from the ongoing conflict between Russia and Ukraine. The decrease was offset by a $0.1 million increase in service revenue for the three months ended December 31, 2024 compared to the three months ended December 31, 2023. Other revenue was consistent in the three months ended December 31, 2024 compared to that in the three months ended December 31, 2023. Total revenue in the EMEA and in the Americas decreased by $3.6 million and $0.3 million, respectively, to $8.7 million and $3.5 million for the three months ended December 31, 2024 compared to $12.3 million and $3.8 million for the three months ended December 31, 2023.
The impact due to foreign currency translation gain was $0.2 million for the three months ended December 31, 2024.
Gross profit for the third fiscal quarter ended December 31, 2024, was $7.2 million, a decrease of 30.4% compared to the prior year period. The decrease was driven by a decrease in sales of $3.9 million, primarily in the EMEA region. Cost of sales for the three months ended December 31, 2024 decreased by $0.8 million, or 8.7%, to $7.9 million from $8.6 million for the three months ended December 31, 2023.
Selling, general and administrative expense for the three months ended December 31, 2024 increased by $2.8 million, or 50.6%, to $8.2 million from $5.4 million for the three months ended December 31, 2023. The increase was driven by a $1.1 million increase in employee compensation due to increase in headcount and stock compensation and $1.0 million increase in other overhead costs to support future sales growth. The increase is also attributable to $0.5 million increase in professional service costs in connection with the Company becoming a publicly listed company during the year.
Research and development costs for the three months ended December 31, 2024 increased by $0.1 million, or 7.7%, to $1.8 million from $1.7 million for the three months ended December 31, 2023. The increase was primarily attributable to a $0.2 million increase in the amortization expense related to capitalized software that was ready for its intended use in July 2024. The increase was offset by a $0.1 million decrease in external consulting fees.
Cash and cash equivalents on December 31, 2024 totaled $1.1 million.
Fiscal Year 2025 Outlook
The Company has reiterated its revenue guidance for fiscal year 2025 to range between $60 million and $67 million.
Subsequent Events
On February 3, 2025, the Company closed an offering of 5,937,100 Units ("Units"), each consisting of one share of common stock, par value $0.0001 per share, and one Class A warrant to purchase one share of common stock at a public offering price of $0.7832 per Unit, for gross proceeds of $4.6 million. The Units have no stand-alone rights and will not be certified or issued as stand-alone securities. The common stock and Class A warrants are immediately separable and were issued separately in this offering. Each Class A warrant was immediately exercisable for one share of common stock at an exercise price of $0.7832 per share (100% of the public offering price per Unit) and will expire on the fifth anniversary of the original issuance date. The offering resulted in a net proceeds of approximately $3.9 million, after deducting placement agent fees sand estimated offering expenses payable by the Company.
Subsequent to the close of the stock offering, the conversion price of the Debentures and the exercise price of the warrants issued in connection with the convertible note changed to $0.7832 pursuant to the Purchase Agreement. The number of Common Stock issuable increased to 2,106,742 shares from 330,000 shares.
About DIH Holding US, Inc.
DIH stands for the vision to "Deliver Inspiration & Health" to improve the daily lives of millions of people with disabilities and functional impairments through providing devices and solutions enabling intensive rehabilitation. DIH is a global provider of advanced robotic devices used in physical rehabilitation, which incorporate visual stimulation in an interactive manner to enable clinical research and intensive functional rehabilitation and training in patients with walking impairments, reduced balance and/or impaired arm and hand functions. Built through the mergers of global-leading niche technology providers, DIH is a transformative rehabilitation solutions provider and consolidator of a largely fragmented and manual-labor-driven industry.
Caution Regarding Forward-Looking Statement
This press release contains certain statements which are not historical facts, which are forward-looking statements within the meaning of the federal securities laws, for the purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. These forward-looking statements include certain statements made with respect to the business combination, the services offered by DIH and the markets in which it operates, and DIH's projected future results. These forward-looking statements generally are identified by the words "believe," "project," "expect," "anticipate," "estimate," "intend," "strategy," "future," "opportunity," "plan," "may," "should," "will," "would," "will be," "will continue," "will likely result," and similar expressions. Forward-looking statements are predictions provided for illustrative purposes only, and projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties that could cause the actual results to differ materially from the expected results. These risks and uncertainties include, but are not limited to: general economic, political and business conditions; the ability of DIH to achieve its projected revenue, the failure of DIH realize the anticipated benefits of the recently-completed business combination and access to sources of additional debt or equity capital if needed. While DIH may elect to update these forward-looking statements at some point in the future, DIH specifically disclaims any obligation to do so.
Investor Contact
Greg Chodaczek
Investor.relations@dih.com
| DIH HOLDING US, INC. CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share data, unaudited) | ||||||||
| As of December 31, 2024 | As of March 31, 2024 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 1,120 | $ | 3,225 | ||||
| Accounts receivable, net of allowances of $240 and $667, respectively | 3,834 | 5,197 | ||||||
| Inventories, net | 7,962 | 7,830 | ||||||
| Due from related party | 6,333 | 5,688 | ||||||
| Other current assets | 4,909 | 5,116 | ||||||
| Total current assets | 24,158 | 27,056 | ||||||
| Property, and equipment, net | 714 | 530 | ||||||
| Capitalized software, net | 1,768 | 2,131 | ||||||
| Other intangible assets, net | 380 | 380 | ||||||
| Operating lease, right-of-use assets, net | 3,735 | 4,466 | ||||||
| Other tax assets | 152 | 267 | ||||||
| Other assets | 907 | 905 | ||||||
| Total assets | $ | 31,814 | $ | 35,735 | ||||
| Liabilities and Deficit | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 3,945 | $ | 4,305 | ||||
| Due to related party | 10,213 | 10,192 | ||||||
| Advance payments from customers | 9,476 | 10,562 | ||||||
| Current portion of deferred revenue | 6,644 | 5,211 | ||||||
| Employee compensation | 3,937 | 2,664 | ||||||
| Current maturities of convertible debt, at fair value | 1,918 | - | ||||||
| Current portion of long-term operating lease | 1,331 | 1,572 | ||||||
| Manufacturing warranty obligation | 582 | 513 | ||||||
| Accrued expenses and other current liabilities ($1,111 measured at fair value) | 9,278 | 9,935 | ||||||
| Total current liabilities | 47,324 | 44,954 | ||||||
| Notes payable - related party | 8,648 | 11,457 | ||||||
| Non-current deferred revenues | 4,986 | 4,670 | ||||||
| Long-term operating lease | 2,443 | 2,917 | ||||||
| Convertible debt, net of current maturities, at fair value | 693 | - | ||||||
| Deferred tax liabilities | 221 | 112 | ||||||
| Other non-current liabilities | 5,381 | 4,171 | ||||||
| Total liabilities | 69,696 | 68,281 | ||||||
| Commitments and contingencies | ||||||||
| Deficit: | ||||||||
| Preferred stock, $0.00001 par value; 10,000,000 shares authorized; no shares issued and outstanding at December 31, 2024 and March 31, 2024 | - | - | ||||||
| Common stock, $0.0001 par value; 100,000,000 shares authorized; 34,861,837 shares issued and outstanding at December 31, 2024; 34,544,935 shares issued and outstanding at March 31, 2024 | 3 | 3 | ||||||
| Additional paid-in-capital | 3,773 | 2,613 | ||||||
| Accumulated deficit | (39,484 | ) | (35,212 | ) | ||||
| Accumulated other comprehensive income (loss) | (2,174 | ) | 50 | |||||
| Total deficit | (37,882 | ) | (32,546 | ) | ||||
| Total liabilities and deficit | $ | 31,814 | $ | 35,735 | ||||
| DIH HOLDING US, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data, unaudited) | ||||||||||||||||
| Three Months Ended December 31, | For the Nine Months Ended December 31, | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Revenue | $ | 15,094 | $ | 19,011 | $ | 50,216 | $ | 45,116 | ||||||||
| Cost of sales | 7,858 | 8,611 | 23,968 | 23,911 | ||||||||||||
| Gross profit | 7,236 | 10,400 | 26,248 | 21,205 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Selling, general, and administrative expense | 8,196 | 5,443 | 22,564 | 17,652 | ||||||||||||
| Research and development | 1,786 | 1,659 | 5,341 | 4,681 | ||||||||||||
| Total operating expenses | 9,982 | 7,102 | 27,905 | 22,333 | ||||||||||||
| Operating income (loss) | (2,746 | ) | 3,298 | (1,657 | ) | (1,128 | ) | |||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense | (25 | ) | (185 | ) | (186 | ) | (460 | ) | ||||||||
| Other income (expense), net | (590 | ) | 237 | (1,004 | ) | (181 | ) | |||||||||
| Total other income (expense) | (615 | ) | 52 | (1,190 | ) | (641 | ) | |||||||||
| Income (loss) before income taxes | (3,361 | ) | 3,350 | (2,847 | ) | (1,769 | ) | |||||||||
| Income tax expense | 367 | 381 | 1,425 | 659 | ||||||||||||
| Net Income (loss) | $ | (3,728 | ) | $ | 2,969 | $ | (4,272 | ) | $ | (2,428 | ) | |||||
| Net income (loss) per share, basic and diluted | $ | (0.11 | ) | $ | 0.12 | $ | (0.12 | ) | $ | (0.10 | ) | |||||
| Weighted average common shares outstanding, basic and diluted | 34,645 | 25,000 | 34,578 | 25,000 | ||||||||||||
| DIH HOLDING US, INC. CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (in thousands, unaudited) | ||||||||||||||||
| Three Months Ended December 31, | For the Nine Months Ended December 31, | |||||||||||||||
| 2025 | 2023 | 2024 | 2023 | |||||||||||||
| Net Income (loss) | $ | (3,728 | ) | $ | 2,969 | $ | (4,272 | ) | $ | (2,428 | ) | |||||
| Other comprehensive (loss) income, net of tax | ||||||||||||||||
| Foreign currency translation adjustments, net of tax of $0 | (145 | ) | 636 | (1,079 | ) | 876 | ||||||||||
| Pension liability adjustments, net of tax of $0 | (64 | ) | (704 | ) | (1,145 | ) | (1,064 | ) | ||||||||
| Other comprehensive loss | (209 | ) | (68 | ) | (2,224 | ) | (188 | ) | ||||||||
| Comprehensive income (loss) | $ | (3,937 | ) | $ | 2,901 | $ | (6,496 | ) | $ | (2,616 | ) | |||||
| DIH HOLDING US, INC. AND SUBSIDIARIES CONDENSED COMBINED STATEMENTS OF CHANGES IN EQUITY (DEFICIT) (in thousands, unaudited) | ||||||||||||||||||
| For the Three Months Ended December 31, | ||||||||||||||||||
| Common Stock | ||||||||||||||||||
| Shares | Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Equity (Deficit) | |||||||||||||
| Balance, September 30, 2024 | 34,544,935 | $ | 3 | $ | 3,323 | $ | (35,756 | ) | $ | (1,965 | ) | $ | (34,395 | ) | ||||
| Net loss | - | - | - | (3,728 | ) | - | (3,728 | ) | ||||||||||
| Other comprehensive loss, net of tax | - | - | - | - | (209 | ) | (209 | ) | ||||||||||
| Net transactions with parent | 316,902 | - | 450 | - | - | 450 | ||||||||||||
| Balance, December 31, 2024 | 34,861,837 | $ | 3 | $ | 3,773 | $ | (39,484 | ) | $ | (2,174 | ) | $ | (37,882 | ) | ||||
| Shares(1) | Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Equity (Deficit) | |||||||||||||
| Balance, September 30, 2023 | 25,000,000 | $ | 2 | $ | (1,898 | ) | $ | (32,166 | ) | $ | (409 | ) | $ | (34,471 | ) | |||
| Net loss | - | - | - | 2,969 | - | 2,969 | ||||||||||||
| Other comprehensive loss, net of tax | - | - | - | - | (68 | ) | (68 | ) | ||||||||||
| Balance, December 31, 2023 | 25,000,000 | $ | 2 | $ | (1,898 | ) | $ | (29,197 | ) | $ | (477 | ) | $ | (31,570 | ) | |||
| For the Nine Months Ended December 31, | ||||||||||||||||||
| Common Stock | ||||||||||||||||||
| Shares | Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Equity (Deficit) | |||||||||||||
| Balance, March 31, 2024 | 34,544,935 | $ | 3 | $ | 2,613 | $ | (35,212 | ) | $ | 50 | $ | (32,546 | ) | |||||
| Net loss | - | - | - | (4,272 | ) | - | (4,272 | ) | ||||||||||
| Out of period adjustment related to reverse recapitalization (Note 2) | - | - | 710 | - | - | 710 | ||||||||||||
| Other comprehensive loss, net of tax | - | - | - | - | (2,224 | ) | (2,224 | ) | ||||||||||
| Stock Compensation | 316,902 | - | 450 | - | - | 450 | ||||||||||||
| Balance, December 31, 2024 | 34,861,837 | $ | 3 | $ | 3,773 | $ | (39,484 | ) | $ | (2,174 | ) | $ | (37,882 | ) | ||||
| Shares(1) | Amount | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Total Equity (Deficit) | |||||||||||||
| Balance, March 31, 2023 | 25,000,000 | $ | 2 | $ | (1,898 | ) | $ | (26,769 | ) | $ | (289 | ) | $ | (28,954 | ) | |||
| Net loss | - | - | - | (2,428 | ) | - | (2,428 | ) | ||||||||||
| Other comprehensive loss, net of tax | - | - | - | - | (188 | ) | (188 | ) | ||||||||||
| Balance, December 31, 2023 | 25,000,000 | $ | 2 | $ | (1,898 | ) | $ | (29,197 | ) | $ | (477 | ) | $ | (31,570 | ) | |||
(1) All outstanding share and per-share amounts have been restated to reflect the reverse recapitalization as established in the Business Combination Agreement as described in Note 1 to the condensed consolidated financial statements.
| DIH HOLDING US, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands, unaudited) | ||||||||
| For the Nine Months Ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (4,272 | ) | $ | (2,428 | ) | ||
| Adjustments to reconcile net loss to net cash provided by operating activities: | ||||||||
| Depreciation and amortization | 611 | 230 | ||||||
| Provision for credit losses | (427 | ) | (815 | ) | ||||
| Allowance for inventory obsolescence | (67 | ) | 705 | |||||
| Stock compensation | 450 | - | ||||||
| Pension contributions | (475 | ) | (456 | ) | ||||
| Pension expense | 238 | 201 | ||||||
| Change in fair value of convertible debt and warrant liability | 1,193 | - | ||||||
| Foreign exchange (gain) loss | (241 | ) | 181 | |||||
| Noncash lease expense | 1,263 | 1,165 | ||||||
| Noncash interest expense | - | 19 | ||||||
| Deferred and other noncash income tax (income) expense | 257 | (237 | ) | |||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | 1,762 | 1,298 | ||||||
| Inventories | (106 | ) | (2,186 | ) | ||||
| Due from related parties | (1,079 | ) | (294 | ) | ||||
| Due to related parties | 100 | 1,910 | ||||||
| Other assets | 114 | (2,540 | ) | |||||
| Operating lease liabilities | (1,275 | ) | (1,352 | ) | ||||
| Accounts payable | (336 | ) | 1,484 | |||||
| Employee compensation | 1,276 | (603 | ) | |||||
| Other liabilities | 157 | 205 | ||||||
| Deferred revenue | 1,819 | 807 | ||||||
| Manufacturing warranty obligation | 75 | 189 | ||||||
| Advance payments from customers | (1,036 | ) | 4,992 | |||||
| Accrued expense and other current liabilities | (849 | ) | 702 | |||||
| Net cash provided by (used in) operating activities | (848 | ) | 3,177 | |||||
| Cash flows from investing activities: | ||||||||
| Purchases of property and equipment | (444 | ) | (135 | ) | ||||
| Net cash used in investing activities | (444 | ) | (135 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from issuance of convertible debt, net of issuance costs | 2,809 | - | ||||||
| Payment on convertible debt | (471 | ) | - | |||||
| Payments on related party notes payable | (3,156 | ) | (4,543 | ) | ||||
| Net cash used in financing activities | (818 | ) | (4,543 | ) | ||||
| Effect of currency translation on cash and cash equivalents | 5 | 5 | ||||||
| Net decrease in cash, and cash equivalents, and restricted cash | (2,105 | ) | (1,496 | ) | ||||
| Cash, cash equivalents and restricted cash - beginning of period | 3,225 | 3,175 | ||||||
| Cash, cash equivalents and restricted cash- end of period | $ | 1,120 | $ | 1,679 | ||||
| Supplemental disclosure of cash flow information: | ||||||||
| Interest paid | $ | 218 | $ | 442 | ||||
| Income tax paid | $ | 15 | $ | - | ||||
| Supplemental disclosure of non-cash investing and financing activity: | ||||||||
| Accounts payable settled upon reverse recapitalization | $ | 710 | $ | - | ||||
