Artificial Intelligence
Surgalign Holdings, Inc. Announces Third Quarter 2020 Results
DEERFIELD, Ill., Nov. 11, 2020 (GLOBE NEWSWIRE) — Surgalign Holdings, Inc. (Nasdaq: SRGA), a global pure-play spine company focused on advancing spine surgery including through the application of digital technologies to improve patient outcomes, today reported operating results for the third quarter of 2020.
Highlights:
- Completed of Acquisition of Holo Surgical Inc. and its ARAI™ Digital Surgery Platform
- Classified divestiture of OEM businesses as discontinued operations assets held for sale at July 20th, 2020 and reported as discontinued operations in the financial results for current and prior periods
- Total global spine revenue of $27.9 million, compared to $28.7 million in the third quarter of 2019
- Net loss from continuing operations of $26.7 million inclusive of approximately of $18.5 million of non-recurring charges
- Adjusted EBITDA loss of $6.3 million, compared to $11.6 million in the third quarter of 2019
“The company made significant progress during the third quarter. We focused Surgalign as a stand-alone global spine company through the completion of the sale of the OEM business in July, we assembled a world-class team with successful track records in the spine market, we formulated our long-term strategy, and completed an acquisition to capitalize on our vision for the future of digital spine surgery,” said Terry Rich, President and Chief Executive Officer of Surgalign Holdings. “Not only were we able to strategically and operationally manage through a significant amount of change in such a short period of time, but we were also able to generate strong sequential improvement in revenue over the second quarter despite the challenging global environment. We plan to leverage the strong momentum we have generated to further improve the business during the balance of 2020 and into the future through our strategy of build, innovate, and acquire.”
Third Quarter 2020
The Company’s worldwide revenues for the third quarter of 2020 were $27.9 million compared with $28.7 million during the same period in the prior year. The $0.8 million decline was primarily a result of a change in revenue recognition for certain international biologic sales as a result of the sale of the OEM business.
Gross profit for the third quarter of 2020 was $16.0 million, or 57.4% of revenue compared to $21.1 million, or 73.5% of revenue, in the third quarter of 2019. Included in gross profit are approximately $4.4 million of non-recurring inventory reserves as a result of transition from an integrated manufacturing company to a distributed model. Adjusted gross profit for the third quarter of 2020 was approximately $20.4 million, or 73.1% of revenue for the third quarter of 2020.
Net loss from continuing operations for the third quarter of 2020 was $26.7 million, compared to $17.0 million for the third quarter of 2019. Adjusted for the impact of $18.5 million of non-recurring charges, net loss from continuing operations was $8.1 million for the three months ended September 30, 2020.
Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA), for the third quarter of 2020 was a loss of $6.3 million compared to a loss of $11.6 million for the third quarter of 2019. The improvement in adjusted EBITDA is driven by reduction in spending through the simplification of the distribution and marketing infrastructure and the elimination of expenses resulting from the sale of the OEM business.
Acquisition of Holo Surgical Inc.
On October 23, 2020 the Company announced the completion of acquisition of Holo Surgical Inc. (Holosurgical). Holosurgical is a Chicago-based private technology company developing the revolutionary Augmented Reality and Artificial Intelligence platform (‘ARAI™’), to enable digital spine surgery.
Business Outlook
Due to the inability to estimate the size and impact of the COVID-19 pandemic on the Company’s operations and financial results, Surgalign Holdings, Inc. is not providing guidance for fiscal 2020. We will continue to evaluate the impact of COVID-19 pandemic on our operations and financial results and will provide additional information when we are more certain.
Conference Call
Surgalign will host a conference call and audio webcast at 4:30 p.m. Eastern Time the same day. The conference call can be accessed by dialing (877) 383-7419 (U.S.) or (760) 666-3754 (International), using conference ID 8371139. The webcast can be accessed through the investor section of Surgalign’s website at surgalign.com/investors/. A replay of the conference call will be available on Surgalign’s website for at least one month following the call.
Virtual Investor Day
Surgalign will host a virtual investor day on Thursday, November 12, 2020 from 1:00 – 3:00pm ET (10:00am – 12:00pm PT).
The event will feature presentations from the Surgalign senior leadership team to provide an overview of the Company, its long-term strategy, and its focus on utilizing digital technology to improve patient outcomes.
To register for the event, please use the following link: Investor Day Registration. After you complete registration, you will receive a confirmation email that will include all of the details needed to access the webcast or to dial in by phone.
The live webcast, including audio, video and presentation slides, will be accessible on www.surgalign.com/investors/ at the time of the meeting. Interested parties unable to watch the live webcast will be able to view and listen to an archived copy of the webcast, which will be available on www.surgalign.com/investors/ following the conclusion of the event.
About Surgalign Holdings, Inc.
Surgalign Holdings, Inc. is a global medical technology company advancing the science of spine care, focused on delivering innovative solutions that drive superior clinical and economic outcomes. The company is building off a legacy of high quality and differentiated products and continues to invest in clinically validated innovation to deliver better surgical outcomes and improve patient’s lives. Surgalign markets products throughout the United States and in more than 50 countries worldwide through an expanding network of top independent distributors. Surgalign, a member of AdvaMed, is headquartered in Deerfield, IL, with commercial, innovation and design centers in San Diego, CA, Marquette, MI, and Wurmlingen, Germany. Learn more at www.surgalign.com and connect on LinkedIn and Twitter.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations, estimates and projections about our industry, our management’s beliefs and certain assumptions made by our management. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. The forward-looking statements are not guarantees of future performance and are based on certain assumptions including general economic conditions, as well as those within the Company’s industry, and numerous other factors and risks identified in the Company’s Form 10-K for the fiscal year ended December 31, 2019 and other filings with the SEC. Our actual results may differ materially from the anticipated results reflected in these forward-looking statements. Important factors that could cause actual results to differ materially from the anticipated results reflected in these forward-looking statements include risks and uncertainties relating to the following: (i) the risk of existing or potential litigation or regulatory action arising from the previously announced SEC and internal investigations and their findings; (ii) the identification of control deficiencies, including material weaknesses in internal control over financial reporting and the impact of the same; (iii) potential reputational damage that the Company has or may suffer as a result of the findings of the investigations; (iv) general worldwide economic conditions and related uncertainties; (v) the anticipated impact of the COVID-19 novel coronavirus pandemic and the Company’s attempts at mitigation; (vi) the failure by the Company to identify, develop and successfully implement immediate action plans and longer-term strategic initiatives; (vii) the reliability of our supply chain; (viii) our ability to meet obligations under our material agreements; (ix) the duration of decreased demand for our products; (x) whether or when the demand for procedures involving our products will increase; (xi) the Company’s access to adequate operating cash flow, trade credit, borrowed funds and equity capital to fund its operations and pay its obligations as they become due, and the terms on which external financing may be available, including the impact of adverse trends or disruption in the global credit and equity markets; (xii) our financial position and results, total revenue, product revenue, gross margin, and operations; (xiii) failure to realize, or unexpected costs in seeking to realize, the expected benefits of the recent Holo Surgical, Inc. (“Holosurgical”) acquisition, including the failure of Holosurgical’s products and services to be satisfactorily developed or achieve applicable regulatory approvals or as a result of the failure to commercialize and distribute its products; (xiv) the failure to effectively integrate Holosurgical’s operations with those of the Company; (xv) the failure to retain key personnel of Holosurgical; (xvi) the number of shares and amount of cash that will be required in connection with any post-closing milestone payments, including as a result of changes in the trading price of the Company’s common stock and their effect on the amount of cash needed by the Company to fund any post-closing milestone payments in connection with the acquisition; (xvii) the effect of the transaction on relationships with customers, suppliers and other third parties; (xviii) the diversion of management time and attention on the transaction and subsequent integration; (xix) the effect and timing of changes in laws or in governmental regulations; (xx) risks resulting from the Company’s reduced cash levels as a result of the recent redemption of Series A Convertible Preferred Stock; and (xi) other risks described in our public filings with the SEC. These factors should be considered carefully, and undue reliance should not be placed on the forward-looking statements. Each forward-looking statement in this communication speaks only as of the date of the particular statement. Copies of the Company’s SEC filings may be obtained by contacting the Company or the SEC or by visiting Surgalign’s website at www.surgalign.com or the SEC’s website at www.sec.gov. We undertake no obligation to update these forward-looking statements except as may be required by law.
Jonathon Singer
Investor and Media Contact
[email protected]
+1 224 303 4651
SURGALIGN HOLDINGS, INC. AND SUBSIDIARIES | |||||||||||||||
Condensed Consolidated Statements of Operations | |||||||||||||||
(Unaudited, in thousands, except share and per share data) | |||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Revenues | $ | 27,926 | $ | 28,702 | $ | 75,562 | $ | 85,849 | |||||||
Cost of goods sold | 11,892 | 7,607 | 30,335 | 24,711 | |||||||||||
Gross profit | 16,034 | 21,095 | 45,226 | 61,138 | |||||||||||
Expenses: | |||||||||||||||
Marketing, general and administrative | 27,754 | 34,247 | 97,095 | 95,454 | |||||||||||
Research and development | 2,208 | 4,271 | 9,764 | 12,475 | |||||||||||
Gain on acquisition contingency | – | – | (130 | ) | (1,590 | ) | |||||||||
Asset impairment and abandonments | 9,356 | 4 | 12,117 | 15 | |||||||||||
Transaction and integration expenses | 3,411 | 3,089 | 5,826 | 13,999 | |||||||||||
Total operating expenses | 42,729 | 41,611 | 124,672 | 120,353 | |||||||||||
Operating loss | (26,695 | ) | (20,516 | ) | (79,446 | ) | (59,215 | ) | |||||||
Total other expense – net | 42 | (47 | ) | 64 | 73 | ||||||||||
Loss before income tax benefit | (26,653 | ) | (20,563 | ) | (79,382 | ) | (59,142 | ) | |||||||
Income tax benefit | – | 3,591 | 3,492 | 9,955 | |||||||||||
Net loss from continuing operations | (26,653 | ) | (16,972 | ) | (75,890 | ) | (49,187 | ) | |||||||
Discontinued operations (Note 4) | – | – | – | – | |||||||||||
Income from operations of discontinued operations (including gain on disposition of $210,866 for the three and nine months ended 9/30/2020) | 191,871 | 13,292 | 181,337 | 39,987 | |||||||||||
Income tax provision | (42,534 | ) | (1,458 | ) | (39,189 | ) | (5,101 | ) | |||||||
Net income on discontinued operations | 149,337 | 11,834 | 142,148 | 34,886 | |||||||||||
Net income (loss) | 122,684 | (5,138 | ) | 66,258 | (14,301 | ) | |||||||||
Net loss from continuing operations per common share – basic | $ | (0.36 | ) | $ | (0.23 | ) | $ | (1.04 | ) | $ | (0.71 | ) | |||
Net loss from continuing operations per common share – diluted | $ | (0.36 | ) | $ | (0.23 | ) | $ | (1.04 | ) | $ | (0.71 | ) | |||
Net income from discontinued operations per common share – basic | $ | 2.04 | $ | 0.16 | $ | 1.95 | $ | 0.50 | |||||||
Net income from discontinued operations per common share – diluted | $ | 2.04 | $ | 0.16 | $ | 1.95 | $ | 0.50 | |||||||
Weighted average shares outstanding – basic | 73,212,662 | 72,472,591 | 72,933,038 | 69,340,006 | |||||||||||
Weighted average shares outstanding – diluted | 73,212,662 | 72,472,591 | 72,933,038 | 69,340,006 | |||||||||||
SURGALIGN HOLDINGS, INC. AND SUBSIDIARIES | |||||||||||
Reconciliation of Revenues to Adjusted Gross Profit | |||||||||||
(Unaudited, in thousands) | |||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||
September 30, | September 30, | ||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||
Revenues | $ | 27,926 | $ | 28,702 | $ | 75,562 | $ | 85,849 | |||
Costs of processing and distribution | 11,892 | 7,607 | 30,335 | 24,711 | |||||||
Gross profit, as reported | 16,034 | 21,095 | 45,226 | 61,138 | |||||||
Inventory write-off | 3,583 | – | 3,631 | – | |||||||
Inventory purchase price adjustment | 788 | 730 | 2,229 | 1,752 | |||||||
Non-GAAP gross profit, adjusted | $ | 20,405 | $ | 21,825 | $ | 51,087 | $ | 62,890 | |||
Non-GAAP gross profit percentage, adjusted | 73.1% | 76.0% | 67.6% | 73.3% | |||||||
SURGALIGN HOLDINGS, INC. AND SUBSIDIARIES | |||||||||||||||
Reconciliation of Net Loss Applicable to Commons Shares to Adjusted EBITDA | |||||||||||||||
(Unaudited, in thousands) | |||||||||||||||
For the Three Months Ended | For the Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Net loss from continuing operations | $ | (26,653 | ) | $ | (16,972 | ) | $ | (75,890 | ) | $ | (49,187 | ) | |||
Interest expense, net | (21 | ) | (4 | ) | (92 | ) | (161 | ) | |||||||
Provision for income taxes | – | (3,591 | ) | (3,492 | ) | (9,955 | ) | ||||||||
Depreciation | 757 | 1,378 | 1,074 | 3,201 | |||||||||||
Amortization of intangible assets | – | 2,739 | 297 | 6,696 | |||||||||||
EBITDA | (25,917 | ) | (16,450 | ) | (78,103 | ) | (49,406 | ) | |||||||
Reconciling items impacting EBITDA | |||||||||||||||
Preferred dividend | – | – | – | – | |||||||||||
Non-cash stock based compensation | 1,140 | 969 | 3,244 | 3,399 | |||||||||||
Foreign exchange gain (loss) | (21 | ) | 51 | 28 | 88 | ||||||||||
Other reconciling items * | |||||||||||||||
Inventory write-off | 3,583 | – | 3,631 | – | |||||||||||
Inventory purchase price adjustment | 788 | 730 | 2,229 | 1,752 | |||||||||||
Gain on acquisition contingency | – | – | (130 | ) | (1,590 | ) | |||||||||
Restatement and related costs | 1,381 | – | 12,637 | – | |||||||||||
Asset impairment and abandonments | 9,356 | 4 | 12,117 | 15 | |||||||||||
Transaction and integration expenses | 3,411 | 3,089 | 5,826 | 13,999 | |||||||||||
Adjusted EBITDA | $ | (6,279 | ) | $ | (11,607 | ) | $ | (38,520 | ) | $ | (31,743 | ) | |||
Adjusted EBITDA as a percent of revenues | -22.5% | -40.4% | -51.0% | -37.0% | |||||||||||
* See explanations in Use of Non-GAAP Financial Measures section later in this release. | |||||||||||||||
SURGALIGN HOLDINGS, INC. AND SUBSIDIARIES | |||||||||||||||
Reconciliation of Net Income (Loss) Applicable to Common Shares and Net Income (Loss) Per Diluted Share to | |||||||||||||||
Adjusted Net Income Applicable to Common Shares and Adjusted Net Income Per Diluted Share | |||||||||||||||
(Unaudited, in thousands except per share data) | |||||||||||||||
For the Three Months Ended | |||||||||||||||
September 30, 2020 | September 30, 2019 | ||||||||||||||
Net | Net | ||||||||||||||
Income (Loss) | Amount | Income (Loss) | Amount | ||||||||||||
Applicable to | Per Diluted | Applicable to | Per Diluted | ||||||||||||
Common Shares |
Share | Common Shares |
Share | ||||||||||||
Net loss from continuing operations | $ | (26,653 | ) | $ | (0.36 | ) | $ | (16,972 | ) | $ | (0.23 | ) | |||
Asset impairment and abandonments | 9,356 | 0.13 | 4 | 0.00 | |||||||||||
Inventory purchase price adjustment | 788 | 0.01 | 730 | 0.01 | |||||||||||
Inventory write-off | 3,583 | 0.05 | – | – | |||||||||||
Restatement and related costs | 1,381 | 0.02 | – | – | |||||||||||
Transaction and integration expenses | 3,411 | 0.05 | 3,089 | 0.04 | |||||||||||
Tax effect on adjustments | – | – | (668 | ) | (0.01 | ) | |||||||||
Adjusted * | $ | (8,134 | ) | $ | (0.11 | ) | $ | (13,817 | ) | $ | (0.19 | ) | |||
For the Nine Months Ended | |||||||||||||||
September 30, 2020 | September 30, 2019 | ||||||||||||||
Net | Net | ||||||||||||||
Income (Loss) | Amount | Income (Loss) | Amount | ||||||||||||
Applicable to | Per Diluted | Applicable to | Per Diluted | ||||||||||||
Common Shares |
Share | Common Shares |
Share | ||||||||||||
Net loss from continuing operations | $ | (75,890 | ) | $ | (1.04 | ) | $ | (49,187 | ) | $ | (0.71 | ) | |||
Asset impairment and abandonments | 12,117 | 0.17 | 15 | 0.00 | |||||||||||
Gain on acquisition contingency | (130 | ) | (0.00 | ) | (1,590 | ) | (0.02 | ) | |||||||
Inventory purchase price adjustment | 2,229 | 0.03 | 1,752 | 0.03 | |||||||||||
Inventory write-off | 3,631 | 0.05 | – | – | |||||||||||
Restatement and related costs | 12,637 | 0.17 | – | – | |||||||||||
Transaction and integration expenses | 5,826 | 0.08 | 13,999 | 0.20 | |||||||||||
Tax effect on adjustments | (1,597 | ) | (0.02 | ) | (2,386 | ) | (0.03 | ) | |||||||
Adjusted * | $ | (41,177 | ) | $ | (0.56 | ) | $ | (37,397 | ) | $ | (0.54 | ) | |||
* See explanations in Use of Non-GAAP Financial Measures section later in this release. | |||||||||||||||
Amount Per Diluted Share may not foot due to rounding. |
Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements presented on a GAAP basis, we disclose non-GAAP net income applicable to common shares and non-GAAP gross profit adjusted for certain amounts. The calculation of the tax effect on the adjustments between GAAP net loss applicable to common shares and non-GAAP net income applicable to common shares is based upon our estimated annual GAAP tax rate, adjusted to account for items excluded from GAAP net loss applicable to common shares in calculating non-GAAP net income applicable to common shares. Reconciliations of each of these non-GAAP financial measures to the corresponding GAAP measures are included in the reconciliations below.
The following are explanations of the adjustments that management excluded as part of the non-GAAP measures for the three and six months ended September 30, 2020 and 2019. Management removes the amount of these costs including the tax effect on the adjustments from our operating results to supplement a comparison to our past operating performance.
2020 Asset impairment and abandonments – These costs relate to asset impairment and abandonments of certain long-term assets within the Spine asset group.
2020 Restatement and related expenses – These costs relate to consulting and legal fees and settlement expenses incurred as a result of the restatement, regulatory and related activities in 2020.
2020 Transaction and integration expenses – These costs relate to professional fees associated with the acquisition of HoloSurgical, accelerated stock compensation expense related to OEM employees terminated in transaction and other matters.
2020 and 2019 Inventory purchase price adjustment – These costs relate to the purchase price effects of acquired Paradigm inventory that was sold during the three and six months ended September 30, 2020 and 2019.
2020 Inventory write-off – These costs relate to the write off of inventory related to the transition from an integrated manufacturing company to a distributed model.
2020 and 2019 Gain on acquisition contingency – The gain on acquisition contingency relates to an adjustment to our estimate of obligation for future milestone payments on the Zyga acquisition.
2019 Transaction and integration expenses – These costs relate to acquisition and integration expenses due to the purchase of Paradigm in 2019.
Material Limitations Associated with the Use of Non-GAAP Financial Measures
EBITDA, Adjusted EBITDA and Adjusted Net Income Applicable to Common Shares should not be considered in isolation, or as a replacement for GAAP measures.
Usefulness of Non-GAAP Financial Measures to Investors
The Company believes that presenting EBITDA, Adjusted EBITDA and Adjusted Net Income Applicable to Common Shares in addition to the related GAAP measures provide investors greater transparency to the information used by management in its financial decision-making.
SURGALIGN HOLDINGS, INC. AND SUBSIDIARIES | |||||||
Condensed Consolidated Balance Sheets | |||||||
(Unaudited, in thousands) | |||||||
September 30, | December 31, | ||||||
2020 | 2019 | ||||||
Assets | |||||||
Cash | $ | 95,790 | $ | 5,608 | |||
Accounts receivable – net | 24,485 | 23,216 | |||||
Inventories – net | 28,195 | 24,574 | |||||
Prepaid and other assets | 4,278 | 4,034 | |||||
Current assets from discontinued operations | – | 138,382 | |||||
Total current assets | 152,748 | 195,814 | |||||
Non-current inventories – net | 4,872 | 6,637 | |||||
Property, plant and equipment – net | 617 | 789 | |||||
Other assets – net | 10,107 | 5,418 | |||||
Noncurrent assets from discontinued operations | – | 135,851 | |||||
Total assets | $ | 168,344 | $ | 344,509 | |||
Liabilities and Stockholders’ Equity | |||||||
Accounts payable | $ | 10,760 | $ | 11,116 | |||
Accrued expenses and other current liabilities | 42,826 | 15,523 | |||||
Current liabilities from discontinued operations | – | 213,749 | |||||
Total current liabilities | 53,586 | 240,388 | |||||
Deferred tax liability | 2,559 | – | |||||
Long-term liabilities | 1,323 | 2,862 | |||||
Noncurrent liabilities from discontinued operations | – | 285 | |||||
Total liabilities | 57,468 | 243,535 | |||||
Preferred stock | – | 66,410 | |||||
Stockholders’ equity: | |||||||
Common stock and additional paid-in capital | 498,417 | 493,372 | |||||
Accumulated other comprehensive loss | (2,619 | ) | (7,629 | ) | |||
Accumulated deficit | (384,922 | ) | (451,179 | ) | |||
Total stockholders’ equity | 110,876 | 34,564 | |||||
Total liabilities and stockholders’ equity | $ | 168,344 | $ | 344,509 | |||
SURGALIGN HOLDINGS, INC. AND SUBSIDIARIES | |||||||
Condensed Consolidated Statements of Cash Flows | |||||||
(Unaudited, in thousands) | |||||||
For the Nine Months Ended | |||||||
September 30, | |||||||
2020 | 2019 | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | 66,258 | $ | (14,301 | ) | ||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||
Depreciation and amortization expense | 6,003 | 16,342 | |||||
Stock-based compensation | 5,550 | 3,399 | |||||
Provision for inventory write-downs | 7,822 | 5,482 | |||||
Revenue recognized due to change in deferred revenue | (2,618 | ) | (3,772 | ) | |||
Asset impairment and abandonments | 12,117 | – | |||||
Gain on sale of OEM business | (210,866 | ) | – | ||||
Derivative loss | 12,641 | – | |||||
Other items to reconcile to net cash | |||||||
used in operating activities | 30,424 | (19,654 | ) | ||||
Net cash used in operating activities | (72,669 | ) | (12,504 | ) | |||
Cash flows from investing activities: | |||||||
Purchases of property, plant and equipment | (9,738 | ) | (10,882 | ) | |||
Patent and acquired intangible asset costs | (419 | ) | (1,786 | ) | |||
Proceeds from sale of OEM business | 436,838 | – | |||||
Acquisition of Paradigm Spine | – | (99,692 | ) | ||||
Net cash provided by (used in) investing activities | 426,681 | (112,360 | ) | ||||
Cash flows from financing activities: | |||||||
Repayment of short-term obligations | (76,912 | ) | – | ||||
Proceeds from long-term obligations | 89,892 | 118,000 | |||||
Payments of debt issuance costs | (1,740 | ) | (729 | ) | |||
Payments on long-term obligations | (207,266 | ) | (500 | ) | |||
Payments for treasury stock | (418 | ) | (204 | ) | |||
Redemption of preferred stock | (66,519 | ) | |||||
Other financing activities | 58 | 395 | |||||
Net cash (used in) provided by financing activities | (262,905 | ) | 116,962 | ||||
Effect of exchange rate changes on cash and cash equivalents | (925 | ) | (96 | ) | |||
Net decrease in cash and cash equivalents | 90,182 | (7,998 | ) | ||||
Cash and cash equivalents, beginning of period | 5,608 | 10,949 | |||||
Cash and cash equivalents, end of period | $ | 95,790 | $ | 2,951 | |||
Artificial Intelligence
Picus Security Launches Security Validation for Kubernetes
Teams can eliminate container security exposures with the new enhancements in Picus’ platform for multi-cloud
SAN FRANCISCO, May 23, 2024 /PRNewswire/ — Picus Security, the Security Validation company, today announced security validation for Kubernetes. This new capability allows Security and DevOps teams to realize the benefits of containers securely by proactively measuring and optimizing the resilience of clusters. It is the latest innovative addition to the Picus Security Validation Platform, which empowers users to consistently validate their security posture and measure risk across on-premises and multi-cloud environments.
For organizations that want an agile way to deploy, run and scale applications, Kubernetes offers considerable benefits. However, security is often the biggest barrier to its adoption. The dynamic and complex nature of Kubernetes means that containers are often misconfigured due to human error. Without a hands-on approach to governance, security gaps can easily emerge over time, increasing the risk of incidents. This situation is exacerbated by the high level of expertise required to secure Kubernetes and the use of default settings which are inherently insecure. According to The State of Kubernetes Report, more than two-thirds of Kubernetes users (67%) have delayed deployments due to security concerns.*
The addition of Kubernetes validation extends the Picus platform’s existing validation capabilities, which are powered by attack simulation and GenAI. It enables organizations to proactively identify and mitigate security misconfigurations, such as weak policies and settings that could allow containers to run with insecure privileges and facilitate lateral movement. Now security teams can automatically assess the security of their workloads wherever they are located – on-premises, in containers, and also in cloud platforms including Amazon Web Services, Google Cloud Platform, and Microsoft Azure.
“Cloud security is perhaps the biggest barrier of entry for organizations that want to take advantage of container orchestration,” said Volkan Erturk, Picus CTO and Co-Founder. “Kubernetes offers incredible opportunities for DevOps teams to deploy and scale new applications, but Security teams can struggle to keep pace.
“With the Picus Security Validation Platform, security concerns won’t slow down an organization’s digital transformation journey. This new offering will allow our users to consistently measure the security of their workloads and vastly reduce the effort needed to address exposures across growing IT environments.”
Additional Information
Read the Kubernetes validation announcement blog.Register for the upcoming webinar on July 11th 2024 at 10.00 EST/ 15.00 BST: Beyond Cloud Security Posture Management: Validating Cloud Effectiveness with Attack Simulation About Picus Security
Picus Security helps security teams consistently and accurately validate their security posture. Our Security Validation Platform simulates real-world threats to evaluate the effectiveness of security controls, identify high-risk attack paths to critical assets, and optimize threat prevention and detection capabilities.
As the pioneer of Breach and Attack Simulation, we specialize in delivering the actionable insights our customers need to be threat-centric and proactive.
Picus is a Gartner® Peer Insights™ Customers’ Choice for 2024 in the BAS tools category†. The company is recognized as a leader by Frost & Sullivan^.
† Gartner, Voice of the Customer for Breach and Attack Simulation Tools, Peer Contributors, 30 January 2024 ^ Frost and Sullivan, 2022 Frost Radar™ report for the Global Breach and Attack Simulation Market
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Artificial Intelligence
Highlights from the Finale: Day Three of the London Blockchain Conference Unravelled
As the London Blockchain Conference draws to a close, attendees heard from industry experts on Driving Innovation with Blockchain.
LONDON, May 23, 2024 /PRNewswire/ — Attendees at the London Blockchain Conference were in to witness the final day, which featured a line-up of informative and thought-provoking speakers. Throughout the day, there were exciting panels and presentations which featured cutting-edge ideas and insights.
Day 3 kickstarted with BSVA launching a new report focusing on the role of blockchain in safeguarding data and streamlining transactions.
Other sessions included:
The Intersection of Web3, AI, and Emerging Tech – Somi Aran, Founder of InPeak gave the opening keynote which explored the dynamic convergence of Web3, Artificial Intelligence, and emerging technologies. She delved into how these technologies are reshaping industries and redefining the boundaries of innovation and the potential impacts and opportunities these technologies present.
Bridging the gap: Making Web3 technologies user-friendly – Christine Leong, CIO, nChain – discussed some of the innovative strategies and practical solutions aimed at simplifying Web3 technologies. She also discussed how nChain is planning to transform Web3 from a domain exclusive to the tech-savvy, into a user-friendly ecosystem that empowers all users.
Is code law? – Rules applicable to blockchain networks – panel featuring Marcin Zarakowski, CEO of Token Recovery, Akber Datoo CEO of D2 Legal Technology, Jeffrey Golden, King’s Counsel (Hon) at 3 Hare Court Chambers, Andrei Kirilenko, Professor of Finance at Cambridge Judge Business School, Professor Sarah Green, Law Commissioner at Law Commission, where they discussed that rules apply to the nodes and validators which support the particular network and process its transactions. The group also discussed whether the blockchain protocols’ rules and software code are the only sources of regulation in blockchain networks.
An Introduction to nChain Identity – Thomas Moretti, Head of Product Development at nChain. He spoke about the Self Sovereignty Identity concept and showcased the latest project it is working on – nChain Identity.
Reimagining Roles: How regulated industry leaders are shaping the future of finance – a panel featuring, Andrew Mosson (Chief Commercial Officer of OneTrading, Néstor Palao, Head DLT & Corporate Clients at Sygnum Bank, Laurence Lewandowska, CFO/COO at BSV Association and Wojciech Kaszycki Chairman & Founder at Mobilum. The panel discussed how the new era of digital assets, traditional banking institutions, exchanges, and financial services are being reimagined in the context of emerging technologies such as blockchain and AI.
Please register here if you would like to listen to any of the sessions today.
If you want to interview any speaker from today’s sessions, please email [email protected].
About the London Blockchain Conference NETWORK. LEARN. ENGAGE. At the London Blockchain Conference, we show how Blockchain will change the world and help people see another way to manage data, build scalable on-chain solutions and achieve great things. We do this by creating valuable, insightful, and engaging events that educate and inform, allowing you to connect and network to build strong business relationships. Our conference is the best avenue to see blockchain innovations, ecosystem announcements, product launches, technology updates, keynote speeches, panels, and fireside chats from blockchain leaders. Join us and experience it for yourself.
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Artificial Intelligence
Nord Anglia Education publishes new insights on the role of AI and metacognition in learning
LONDON, May 23, 2024 /PRNewswire/ — INSIGHTS, the global publication from Nord Anglia Education, has published two new articles taking an in-depth look at AI in education and the role of metacognition in teaching and learning.
Exploring the role of AI in learning
https://www.nordangliaeducation.com/insights/2024/articles/the-generative-generationIn its ‘Generative Generation’ feature, INSIGHTS explores the role of artificial intelligence (AI) in education, and whether the technology is making it easier for children to learn. Speaking to Nord Anglia’s educators as well as leading experts from the world of academia, it also includes real-life examples of how Nord Anglia’s schools are using AI in the classroom.
For example, Nord Anglia’s British International School in Kuala Lumpur has adapted the technology to create an AI-powered teaching assistant that can personalise learning, guide students through content exploration, and deepen their understanding through interactive activities. Learners define the topic they want to explore and the course specification they are working to, and the AI explores the content with them in a conversational way, enabling them to ask questions as they go.
Dr Bruce Geddes, Deputy Head of Secondary at the school, told INSIGHTS that AI represents “the biggest opportunity we’ve had in our lifetimes, for many, many spheres, but particularly in education”.
Avenues: The World School in New York, which became part of Nord Anglia in 2023, encourages its students to use AI in their work. As an example, in an app development project students use ChatGPT to generate the bulk of the coding, then review, correct and refine it. This saves them “hours of manual work by leveraging the appropriate tool in an academically appropriate way,” says Lia Muschellack, Director of Technology at the school.
The school also has its own generative AI chatbot, Savvy, built in 2019 and now powered by open AI technology. It can answer queries, provide information, and engage in “diverse discussions ranging from academic topics to casual conversations”.
“We understand that our students will be actively leveraging these tools throughout their academic and professional pathways, so we want to make sure they not only understand the potentials and limitations, but that they have tinkered and truly experienced them,” Muschellack explains.
Metacognition: a learning superpower
In its feature ‘Metacognition. Helping Kids Unlock the Power of ‘Thinking about Thinking’, INSIGHTS looks at how students can develop the important skill of metacognition.
“Metacognition is the ability to be aware of our cognitive or thought processes and to monitor, reflect on, and change those processes,” Dr Rose Luckin, Professor of Learner Centred Design at the University College London Knowledge Lab, told INSIGHTS.
Nord Anglia Education is working with Dr Luckin to develop its approach to metacognition and to help teachers introduce metacognitive strategies into classrooms. It has developed a metacognitive framework of six “Learner Ambitions” to help students develop the 6 Cs: to become critical, creative, committed, and curious learners, working compassionately and collaboratively in the classroom and beyond.
As the article explains, Nord Anglia’s deep dive into metacognition has many goals: developing student agency, boosting academic performance, and developing ‘future’ skills that employers want. The framework is being initially applied across 27 Nord Anglia schools around the world and its impact will be measured in independent research in partnership with Boston College, reporting in 2025.
Nord Anglia’s examination of metacognition also involves exploring personalised goals and thinking routines. For instance, students at Nord Anglia International School Hong Kong use the “Step In, Step Out, Step Back” routine to develop empathy and understanding in their studies. “It’s about asking the right questions; those really big questions that lead to even more questions,” says Raquel Thomson, the school’s Deputy Head of Primary. “Thinking strategies like this stay with students and serve a purpose whatever they do in their lives, whether they choose to be a scientist or a teacher or go into business.”
For media enquiries please contact: Francesca Milani Communications Manager, Digital Education Portfolio +44 20 7131 0000 [email protected]
About Nord Anglia Education:
As the world’s leading international schools organisation, we’re shaping a generation of creative and resilient global citizens who graduate from our schools with everything they need for success, whatever they choose to be or do in life.
Our strong academic foundations combine world-class teaching and curricula with cutting-edge technology and facilities, creating learning experiences like no other. Inside and outside of the classroom, we inspire our students to achieve more than they ever thought possible.
No two children learn the same way, which is why our schools around the world personalise learning to what works best for every student. Inspired by our high-quality teachers, our students achieve outstanding academic results and go on to study at the world’s top universities.
To learn more or apply for a place for your child, go to nordangliaeducation.com.
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