RAMAT GAN, Israel, Nov. 12, 2013 /PRNewswire/ -- LabStyle Innovations Corp. (OTCQB/OTCBB: DRIO), developer of Dario™, a cloud-based, mobile health (mHealth) platform for diabetes management and related blood glucose monitoring, reported today its financial and operational results for the three and nine months ending on September 30, 2013.  The company also provided a business update and its plans for the coming months.

Highlights of LabStyle's 2013 accomplishments and plans for the remainder of 2013 and the first quarter of 2014 include:

• Being granted a CE Mark for Dario™ in September 2013 which allows the company to market the Dario™ diabetes management platform in Europe.  The platform includes the Dario™ software application, the stylish, 'all-in-one', pocket-sized, Dario blood glucose monitoring device and the web application.
• Commencing roll-out plans.  As announced on November 4^th, LabStyle will begin the world roll-out of the Dario™ diabetes monitoring platform with the launch of the Dario™ iOS software application on December 12, 2013 in the United Kingdom, New Zealand and Australia.  The Dario™ app is designed to capture the complete diabetic landscape from monitoring to therapy; LabStyle believes Dario™ is the only end-to-end mobile health platform that offers and encourages people living with diabetes a new way to understand and control their disease.  With the launch of the Dario™ iOS app, customers will be able to experience the novel functionality and benefits of the Dario software, no matter what blood glucose monitoring device they are currently using, by manually inputting the information.
• Planning to launch the iOS app in Italy and Belgium and the Android app, in the United Kingdom, New Zealand, Australia, Italy and Belgium – both during first quarter 2014.
• Planning for first quarter 2014 soft launch of the Dario™ all-in-one blood glucose monitoring device in the United Kingdom, Italy, New Zealand and Australia.  The device is designed to work in tandem with the Dario™ app.
• Preparing to file for 510(k) FDA clearance for marketing the full Dario™ diabetes management platform in the U.S. by the end of 2013; anticipating regulatory clearance in 2014; actively exploring other regulatory approvals worldwide.
• Commencement of trading of the company's common stock in the OTCQB Market and the OTC Bulletin Board under the symbol "DRIO" in April 2013.
• Closing a private placement offering in May 2013, raising gross proceeds of $10.0 million.
• Receiving approval from Apple in 2013 for the Dario app to be available as a free download to European iPhone and other iOS device users.
• Continuing to work with existing contract manufacturers and other suppliers to prepare for the anticipated initial soft launch of the Dario glucose monitoring device.
• Continuing to actively pursue intellectual property protection for LabStyle's software and hardware innovations.
• Engaging Farla Medical in April 2013 as the exclusive distributor of Dario™ in the United Kindgom and Belgium.
• Engaging Harmonium Pharma in June 2013 as the exclusive distributor of Dario™ in Italy.
• Making internal senior management changes aimed at preparing LabStyle to move from research and development stage to commercial stage.
• Planning to exhibit and sneak preview Dario iOS app at Medica 2013 in Germany, November 20-23, 2013, Hall 16, Booth G40.

As of September 30, 2013, LabStyle had $4,467,829 in cash on hand, which the company believes should be sufficient resources to continue its activity into March 2014, and to thereby commence an initial soft launch of Dario for iPhones and other iOS devices in Europe during the first quarter of 2014.  The goal of this initial launch will be to collect customer feedback and to refine LabStyle's longer-term roll-out strategy.

Management Commentary

Dr. Oren Fuerst, executive chairman and co-founder of LabStyle, said, "It has been a very exciting third quarter at LabStyle.  We were granted a CE Mark for Dario in just a little over two years since the founding of the company.  We are also in full gear with final preparations to commence the roll-out of Dario.  The first stage begins next month.  People with diabetes in the UK as well as New Zealand and Australia will have the first opportunity to experience the rich features of the Dario software beginning on December 12th." 

Mr. Erez Raphael, president and chief executive officer of LabStyle, said, "As our company name implies, we are constantly 'innovating' by improving and refining Dario on an ongoing basis to meet the needs of 21^st century diabetics and recruiting talent to help us achieve our goals.  Dario is designed to be the first truly social diabetes management platform, with communities of users benefiting from and sharing its attributes.  We are on a strong and focused course, and we look forward to achieving both near and longer term milestones for the benefit of both our investors and those in the diabetic community."

Financial Results

From October 2011 through September 30, 2013, LabStyle raised nearly $17 million in investor funding and, to a small degree, through the exercise of investor warrants.  As company activities have increased, LabStyle has sought to deploy its resources in targeted fashion during the company's pre-revenue stage to advance its business goals, particularly in the areas of research and development, manufacturing and personnel expansion.

Research and development expenses for the third quarter of 2013 were $1,077,891 compared with $391,269 for the third quarter of 2012, and for the first nine months of 2013 were $3,169,110 compared with $1,012,087 for the first nine months of 2012.  The increase was largely due to recruitment of new employees and progress in product development.

Marketing and pre-production expenses were $763,317 for the third quarter of 2013 and $128,171 in the third quarter of 2012, and for the first nine months of 2013 were $1,924,408 compared with $128,171 for the first nine months of 2012. The increase was largely due to the anticipated soft launch of the Dario during the first quarter of 2014 as well as due to depreciation of LabStyle's manufacturing equipment of approximately $540,000.

General and administrative expenses for the third quarter of 2013 were $1,397,365 and included non-cash stock-based compensation expenses of $568,732. General and administrative expenses for the third quarter of 2012 were $503,776 and included non-cash stock-based compensation expense of $48,461.

General and administrative expense for the first nine months of 2013 were $4,817,296 and included non-cash stock-based compensation expenses of $1,927,272 and non-cash expenses of $1,011,370 related to the issuance of common stock and warrants to a service provider.  General and administrative expenses for the first nine months of 2012 were $1,244,053 and included non-cash stock-based compensation expense of $341,265.

Financing expenses for the third quarter of 2013 were mainly driven by a $191,898 non-cash charge related to the revaluation of warrants, compared with $2,033,217 in the third quarter of 2012.  Financing expenses for the first nine months of 2013 were mainly driven by a $3,991,875 non-cash charge related to the revaluation of warrants, compared with $2,006,777 and $101,263 driven by non-cash charges related to revaluation of warrants and issuance costs related to warrants, respectively, during the first nine months of 2013.

The net loss for the third quarter of 2013 was $3,471,962, or $0.17 per share, compared with a net loss of $3,056,155, or $0.25 per share, for the third quarter of 2012.  For the first nine months of 2013 the net loss was $13,985,303, or $0.79 per share, compared with a net loss of $4,494,268, or $0.38 per share, for the first nine months of 2012.

The non-GAAP adjusted EBITDA loss for the third quarter of 2013 was $2,232,006, or $0.11 per share, compared with a non-GAAP adjusted EBITDA loss for the third quarter of 2012 of $937,882, or $0.07 per share.  The non-GAAP adjusted EBITDA loss for the first nine months of 2013 was $5,728,305, or $0.32 per share, versus a non-GAAP adjusted EBITDA loss of $1,896,515, or $0.16 per share, in the corresponding period in 2012.

LabStyle used $5,473,929 in cash to fund operating activities during the first nine months of 2013. As of September 30, 2013, LabStyle had cash, cash equivalents, restricted cash and short-term bank deposits of $4,575,929.

Non-GAAP Measures

Readers should note that LabStyle has, in the schedule below, supplemented its GAAP net income (loss) with a non-GAAP measure of adjusted EBITDA.  Management believes that this non-GAAP financial measure provides useful supplemental information to management and investors regarding LabStyle's performance, facilitates a more meaningful comparison of results for current periods with previous operating results, and assists management in analyzing future trends, making strategic and business decisions and establishing internal budgets and forecasts. A reconciliation of non-GAAP adjusted EBITDA to GAAP net income (loss) in the most directly comparable GAAP measure is provided in the schedule below.

There are limitations in using this non-GAAP financial measure because it is not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. This non-GAAP financial measure should not be considered in isolation or as a substitute for GAAP financial measures. Investors and potential investors should consider non-GAAP financial measures only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP and the reconciliations of the non-GAAP financial measure provided in the schedule below:

About LabStyle Innovations

LabStyle Innovations Corp. (OTCQB:DRIO) is a mobile health (mHealth) company developing and commercializing patent-pending technology providing consumers with laboratory-testing capabilities using smart phones.  LabStyle's flagship product, Dario™, is a mobile, cloud-based, diabetes management platform which includes a stylish, 'all-in-one', pocket-sized, blood glucose monitoring device.  Dario™ received CE mark certification in September 2013 and is pursuing patent applications in multiple jurisdictions covering the specific processes related to blood glucose level measurement as well as more general methods of rapid tests of body fluids using mobile devices and cloud-based services.  For more information: www.mydario.com.

Cautionary Note Regarding Forward-Looking Statements

This news release and the statements of representatives and partners of LabStyle Innovations Corp. (the "Company") related thereto contains or may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the generality of the foregoing, words such as "plan," "project," "potential," "seek," "may," "will," "expect," "believe," "anticipate," "intend," "could," "estimate" or "continue" are intended to identify forward-looking statements. Readers are cautioned that certain important factors may affect the Company's actual results and could cause such results to differ materially from any forward-looking statements that may be made in this news release. Factors that may affect the Company's results include, but are not limited to, regulatory approvals, product demand, market acceptance, impact of competitive products and prices, product development, commercialization or technological difficulties, the success or failure of negotiations and trade, legal, social and economic risks, and the risks associated with the adequacy of existing cash resources. Additional factors that could cause or contribute to differences between the Company's actual results and forward-looking statements include, but are not limited to, those risks discussed in the Company's filings with the U.S. Securities and Exchange Commission. Readers are cautioned that actual results (including, without limitation, the timing for and results of the Company's commercial plans for Dario and the timing for and results of regulatory review of Dario) may differ significantly from those set forth in the forward-looking statements. The Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law. 

Dario™ and the Dario™ logo are trademarks owned by LabStyle Innovation Ltd.

© 2013 LabStyle Innovations Corp.  All rights reserved.

Press Contact:
Marjie Hadad
Media Liaison
LabStyle Innovations
Marjie@netvision.net.il
+972-54-536-5220

SOURCE LabStyle Innovations Corp.