Cytori Reports First Quarter 2015 Business and Financial Results

Cytori Therapeutics (NASDAQ: CYTX) today announced its first quarter financial results and provided updates on its corporate activity and clinical development.

Cytori continued to reduce its operating cash burn, spending a total of $5 million in the first quarter 2015, compared to $9 million in Q1 2014. First quarter 2015 net loss allocable to common stock holders was $22.6 million (or $7.2 million and $0.07 per share when excluding a non-cash charge of $15.4 million related to the change in fair value of warrant liability) compared to $10 million (or $0.14 per share) for the same period in 2014. Cytori ended the first quarter of 2015 with $13.2 million of cash and cash equivalents or approximately $39 million pro-forma at March 31, 2015, when considering $25.7 million in net cash proceeds since March 31, 2015 from the issuance of shares under its ATM program, warrant exercises, and the net proceeds from the initial closing of a registered direct offering, which closed on May 8, 2015.

Selected Q1 Highlights:

• Cytori received FDA IDE full approval for Pivotal Phase III trial, STAR TRIAL, to evaluate ECCS-50 in treating hand dysfunction associated with scleroderma – Jan’ 2015
• FDA approved an increase in number of STAR trial sites from 12 to 20 – Feb’ 2015
• Enrollment began for ACT-OA, a 90 patient, US Phase II trial, to study ECCO-50 in treating osteoarthritis of the knee - Feb’ 2015
• Cytori and Lorem Vascular were granted regulatory clearance for Cytori Celution® System by the State Food and Drug Administration of the People’s Republic of China – Apr’ 2015
• Cytori received initial purchase order of Celution devices and 1,100 consumable sets from Lorem Vascular, our Chinese Licensee – Apr’ 2015
• Cytori was granted orphan drug status for treatment of scleroderma in European Union – Apr’ 2015
• Cytori reported top line 12 month follow-up data on SCLERADEC-I Trial – Apr’ 2015
• Cytori presented preclinical and mechanistic data supporting use of Cytori Cell Therapy™ in wounds combining thermal burn and radiation exposure - Apr’ 2015

“We accomplished the key objectives we hoped to achieve over the past 4 quarters and are off to a good start in 2015,” said Dr. Marc H. Hedrick, President and CEO of Cytori Therapeutics. “Now the lion’s share of our corporate focus and energy will go into trial enrollment and strategically managing our clinical pipeline.”

“Enrollment in the ACT-OA trial is proceeding as anticipated; we now have 38 patients enrolled into this 90 patient trial. We are confident that we will complete enrollment this year” said Dr. Steven Kesten, Chief Medical Officer of Cytori Therapeutics. “In addition, the Scleroderma program is a key component of our overall clinical strategy and we are very active in laying the groundwork to begin the U.S. trial in the next few months”.

Q1 Financial Performance

• Cash and debt balances at March 31, 2015 of approximately $13.2 million (or approximately $39 million pro-forma) and $25.4 million, respectively.
• Q1 operating cash burn of $5.0 million, compared to $9.0 million for the same period in 2014.
• Q1 product revenue of $0.9 million, compared to $1.0 million for the same period in 2014.
• Q1 contribution (profit/loss) from our sales and marketing organization, excluding share based compensation, of a loss of $0.5 million, compared to a loss of $1.2 million for the same period in 2014.
• Q1 contract revenue of $1.4 million, compared to $0.4 million for the same period in 2014.
• Q1 net loss allocable to common stock holders was $22.6 million (or $0.21 per share, or $7.2 million and $0.07 per share when excluding a non-cash charge of $15.4 million related to the change in fair value of warrant liability) compared to $10 million (or $0.14 per share) for the same period in 2014.

“The reduced operating cash burn, combined with our renegotiated Olympus liability, the proceeds from recent warrant exercises, ATM, and the first closing of $19.4 million of our recently announced equity offering, significantly strengthened our balance sheet and enhances our ability to restructure our debt obligations, and more importantly, it provides liquidity for well over 12 months of operations,” said Tiago Girao, VP of Finance and CFO of Cytori Therapeutics. “We can now stay laser-focused on the execution of our key clinical objectives with continued emphasis on the two late stage U.S. clinical trials.”

Upcoming Catalysts:

• Complete enrollment of US ACT-OA trial and examine data
• Initiate enrollment of US scleroderma STAR trial
• Publication of SCLERADEC-I 12 month data and initiation of enrollment of French SCLERADEC-II trial
• Begin enrollment of MHLW funded Japanese stress urinary incontinence trial
• Complete core research and development activities for the next generation Celution System and file for IDE in the U.S. for a BARDA funded burn trial

Management Conference Call Webcast and Shareholder Letter Information

Cytori will host a management conference call at 5:30 p.m. Eastern Time today to further discuss the Company's progress. The webcast will be available live and by replay two hours after the call and may be accessed under "Webcasts" in the Investor Relations section of Cytori's website. If you are unable to access the webcast, you may dial in to the call at +1.877.402.3914, Conference ID: 33808048.

About Cytori

Cytori Therapeutics is a late stage cell therapy company developing autologous cell therapies from adipose tissue to treat a variety of medical conditions. Data from preclinical studies and clinical trials suggest that Cytori Cell Therapy™ acts principally by improving blood flow, modulating the immune system, and facilitating wound repair. As a result, Cytori Cell Therapy™ may provide benefits across multiple disease states and can be made available to the physician and patient at the point-of-care through Cytori’s proprietary technologies and products. For more information: visit www.cytori.com.

Cautionary Statement Regarding Forward-Looking Statements

This press release includes forward-looking statements that involve known and unknown risks and uncertainties. All statements, other than historical facts are forward looking statements. Such statements are subject to risks and uncertainties that could cause our actual results and financial position to differ materially. Some of these risks include the level of future interest in our products by Japan research institutions, performance of our Japan distribution network, clinical, pre-clinical and regulatory uncertainties, such as those associated with the ACT-OA Trial, STAR, SCLERODEC-I and SCLERODEC-II clinical trials, including risks in the collection and results of clinical data, final clinical outcomes, dependence on third party performance, performance and acceptance of our products in the marketplace, unexpected costs and expenses, our reliance on key personnel, the right of the Federal Government to cut or terminate further support of the thermal burn injury program, and other risks and uncertainties described under the "Risk Factors" in Cytori's Securities and Exchange Commission Filings, included in our annual and quarterly reports.

There may be events in the future that we are unable to predict, or over which we have no control, and our business, financial condition, results of operations and prospects may change in the future. We assume no responsibility to update or revise any forward-looking statements to reflect events, trends or circumstances after the date they are made unless we have an obligation under U.S. Federal securities laws to do so.