airs-20230331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________.

Commission file number: 001-40973

AirSculpt Technologies, Inc.

(Exact name of registrant as specified in its charter)


Delaware						87-1471855
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


1111 Lincoln Road, Suite 802
Miami Beach, FL						33139
(Address of principal executive offices)						(Zip Code)

Registrant’s telephone number, including area code: (786) 709-9690

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock, par value $0.001 per share

AIRS

The Nasdaq Global Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The registrant had 56,784,968 shares of common stock outstanding as of May 12, 2023.


		Page
PART I FINANCIAL INFORMATION

Item 1.	Financial Statements	2





	Condensed Consolidated Balance Sheets as of March 3 1 , 202 3 (Unaudited) and December 31, 2022	2
	Condensed Consolidated Statements of Operations for the Three Months Ended March 3 1 , 202 3 and 202 2 (Unaudited)	3
	Condensed Consolidated Statements of Other Comprehensive Income/(Loss) for the Three Months Ended March 3 1 , 202 3 and 202 2 (Unaudited)	4
	Condensed Consolidated Statements of Changes in Stockholders' Equity for the Three Months Ended March 31, 2023 and 2022 (Unaudited)	5
	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2023 and 2022 (Unaudited)	6
	Notes to Condensed Consolidated Financial Statements (Unaudited)	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	21
Item 4.	Controls and Procedures	21

PART II OTHER INFORMATION
Item 1.	Legal Proceedings	22
Item 1A.	Risk Factors	22
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	22
Item 3.	Defaults Upon Senior Securities	22
Item 4.	Mine Safety Disclosures	22
Item 5.	Other Information	22
Item 6.	Exhibits	23

Signatures		24


($000s)	March 31, 2023		December 31, 2022
	(Unaudited)
Assets
Current assets
Cash and cash equivalents	$	11,283	$	9,616
Taxes receivable	2,743		2,831
Prepaid expenses and other current assets	3,861		4,229
Total current assets	17,887		16,676
Property and equipment, net	27,284		24,206
Other long-term assets	3,273		3,280
Right of use operating lease assets	29,432		23,764
Intangible assets, net	49,911		51,099
Goodwill	81,734		81,734
Total assets	$	209,521	$	200,759
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable	$	4,340	$	3,844
Accrued payroll and benefits	2,455		2,991
Current portion of long-term debt	2,125		2,125
Deferred revenue and patient deposits	3,891		2,358
Accrued and other current liabilities	3,621		6,644
Current operating lease liabilities	5,083		4,356
Total current liabilities	21,515		22,318
Long-term debt, net	81,148		81,420
Deferred tax liability, net	5,485		5,485
Long-term operating lease liabilities	25,120		19,745
Other long-term liabilities	1,025		1,025
Total liabilities	134,293		129,993
Commitments and contingent liabilities (Note 9)
Stockholders' equity
Common stock, $0.001 par value; shares authorized - 450,000,000; shares issued and outstanding - 56,711,260 and 56,181,689, respectively	56		56
Additional paid-in capital	90,312		85,858
Accumulated other comprehensive loss	(54)		(76)
Accumulated deficit	(15,086)		(15,072)
Total stockholders' equity	75,228		70,766
Total liabilities and stockholders' equity	$	209,521	$	200,759


	Three Months Ended March 31,
(in $000s, except for shares and per share figures)	2023		2022
Revenue	$	45,813	$	39,544
Operating expenses:
Cost of service (exclusive of depreciation and amortization)	18,017		14,662
Selling, general and administrative	23,882		24,167

Depreciation and amortization	2,336		1,886
Gain on disposal of long-lived assets	(184)		—
Total operating expenses	44,051		40,715
Income/(loss) from operations	1,762		(1,171)
Interest expense, net	1,735		1,492
Pre-tax net income/(loss)	27		(2,663)
Income tax expense/(benefit)	41		(1,970)
Net loss	$	(14)	$	(693)

Loss per share of common stock
Basic	$	(0.00)	$	(0.01)
Diluted	$	(0.00)	$	(0.01)
Weighted average shares outstanding
Basic	56,443,370		55,640,154
Diluted	56,443,370		55,640,154


	Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Income
($000s)	Shares	Amount						Accumulated Deficit		Total
Balance at December 31, 2021	55,640,154	$	56	$	83,865	$	—	$	(393)	$	83,528
Distributions	—	—		(282)		—		—		(282)
Equity-based compensation	—	—		7,316		—		—		7,316
Net loss	—	—		—		—		(693)		(693)
Balance at March 31, 2022	55,640,154	$	56	$	90,899	$	—	$	(1,086)	$	89,869

Balance at December 31, 2022	56,181,689	$	56	$	85,858	$	(76)	$	(15,072)	$	70,766
Issuance of common stock through unit vesting	529,571	—		—		—		—		—

Dividends	—	—		66		—		—		66
Equity-based compensation	—	—		4,388		—		—		4,388

Net loss	—	—		—		—		(14)		(14)
Other comprehensive income	—	—		—		22		—		22
Balance at March 31, 2023	56,711,260	$	56	$	90,312	$	(54)	$	(15,086)	$	75,228


	March 31, 2023		December 31, 2022		Useful Life
Technology and know-how	$	53,600	$	53,600	15 years
Trademarks and tradenames	17,700		17,700		15 years
	71,300		71,300
Accumulated amortization of technology and know-how	(16,079)		(15,186)
Accumulated amortization of tradenames and trademarks	(5,310)		(5,015)
Total intangible assets	$	49,911	$	51,099


	March 31, 2023		December 31, 2022
Medical equipment	$	9,474	$	8,906
Office and computer equipment	740		551
Furniture and fixtures	3,604		3,457
Leasehold improvements	18,658		14,614
Construction in progress	2,150		2,854
Less: Accumulated depreciation	(7,342)		(6,176)
Property and equipment, net	$	27,284	$	24,206


	March 31, 2023		December 31, 2022
Term loan	$	84,469	$	85,000
Unamortized debt discounts and issuance costs	(1,196)		(1,455)
Total debt, net	83,273		83,545
Less: Current portion	(2,125)		(2,125)
Long-term debt, net	$	81,148	$	81,420


2023 (excluding the three months ended March 31, 2023)	$	1,594
2024	2,125
2025	4,250
2026	6,375
2027	70,125
Total maturities	$	84,469


	March 31, 2023		March 31, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows from operating leases	$	1,253	$	978
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	7,870	$	2,073




2023 (excluding the three months ended March 31, 2023)	$	4,310
2024	6,393
2025	6,542
2026	6,173
2027	5,069
Thereafter	11,081
Total lease payments	39,568
Less: imputed interest	(9,366)
Total lease obligations	$	30,202


	Three Months Ended March 31,
	2023			2022
Cases	3,640			3,156
Case growth	15.3		%	N/A
Revenue per case	$	12,586		$	12,530
Revenue per case growth	0.4		%	N/A
Number of facilities	23			19
Number of total procedure rooms	49			36


	Three Months Ended March 31,
		2023			2022
Cases		3,155			3,127
Case growth		0.9		%	N/A
Revenue per case		$	12,676		$	12,510
Revenue per case growth		1.3		%	N/A
Number of facilities		18			18
Number of total procedure rooms		38			35


	Three Months Ended March 31,
($ in thousands)	2023		2022
Cash Flows Provided By (Used For):
Operating activities	$	6,219	$	7,080
Investing activities	(3,815)		(4,274)
Financing activities	(737)		(924)
Net increase in cash and cash equivalents	1,667		1,882


Exhibit Number			Description of Exhibit
10.1			Second Amended and Restated Employment Agreement between the Company and Dr. Rollins, dated January 4, 2023
31.1*			Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*			Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1*†			Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*†			Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS			Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document
101.SCH*			Inline XBRL Taxonomy Extension Schema Document
101.CAL*			Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*			Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*			Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE*			Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*			Cover Page Interactive Data File (embedded within the Inline XBRL document)


			AIRSCULPT TECHNOLOGIES, INC.

			By:			/s/ Dennis Dean
						Dennis Dean
						Chief Financial Officer
						(Principal Accounting and Financial Officer)

SEC Form 10-Q filed by AirSculpt Technologies Inc.