Ms. Chien Huang reports

TITAN MEDICAL REPORTS OPERATING AND FINANCIAL RESULTS FOR THE FIRST QUARTER 2023

Titan Medical Inc. has released its financial results for the three months ended March 31, 2023.

Recent activities:

• On May 26 and June 5, respectively, the company announced IP licensing transactions for total upfront payments of negative $15.5-million.
• Subsequent to the quarter, the company improved its working capital position further by settling multiple trade-related payables that cancelled approximately $900,000 of its financial obligations.
• On May 29, as a result of the strategic review process announced on Nov. 30, 2022, the board of directors of Titan approved a strategic transition in the company's business from the development and commercialization of robotic-assisted surgeries (RAS) technologies to evaluating new opportunities to further develop and license its intellectual property. Titan continues to retain the rights necessary to develop and commercialize RAS technologies, should it choose to do so, including the two-instrument Enos single-access RAS system and, as announced on Jan. 9, 2023, a three-instrument single-access RAS system that builds on the Enos System technologies.

On May 29, the company announced executive leadership team changes effective June 1, 2023, reflecting the company's strategic transition and to reduce operating expenses in the business, including the appointment of Paul Cataford as interim president and chief executive officer, and Chien Huang as chief financial officer.

Financial highlights

As of March 31, 2023, Titan had cash of $1.3-million, compared with $3.3 million at Dec. 31, 2022. The company has since improved its cash position with proceeds of $15.5-million from two IP licensing transactions announced on May 26 and June 5.

Working capital deficit was $6.4-million at March 31, 2023. Subsequent to the quarter, the company received proceeds of $15.5-million which has improved its working capital position. In addition, the company has reduced its outstanding financial obligations to multiple vendors by approximately $900,000.

For the three months ended March 31, 2023, research and development (R&D) expenses were $500,000 compared with $9.4-million in the comparative period. The decrease in R&D expenses is related to the strategic review. In the three months ended March 31, 2023, the company implemented cost-cutting measures that significantly reduced R&D expenses. In the comparative period, R&D expenses were related to the development of the Enos System and transferring key components of the Enos System to manufacturing.

General and administrative (G&A) expenses were $2.3-million for the three months ended March 31, 2023, compared with $2.5-million in the comparative period. The decrease in G&A expenses is related to the strategic review. In the three months ended March 31, 2023, the company implemented cost-cutting measures that reduced G&A expenses.

The company's interim financial statements and management discussions and analysis (MD&A) are available at SEDAR.

About Titan Medical Inc.

Titan Medical, a medical technology company headquartered in Toronto, Ont., with operations in Chapel Hill, N.C., has developed an expansive patent portfolio related to the enhancement of robotic-assisted surgery, including through a single access point, and is currently focused on evaluating new opportunities to further develop and license its intellectual property.

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