You are here

LeMaitre Q2 2018 Record Sales $27.0mm (+5%), Record EPS $0.43 (+86%)

BURLINGTON, Mass., July 26, 2018 (GLOBE NEWSWIRE) -- LeMaitre Vascular, Inc. (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q2 2018 results, provided guidance and announced a $0.07/share dividend.

Q2 2018 Results 

  • Record sales of $27.0mm, +5% vs. Q2 2017
  • Record operating income of $11.5mm vs. $5.5mm, +108%
  • Record net income of $8.8mm vs. $4.6mm, +89%
  • Record earnings of $0.43 per diluted share vs. $0.23, +86%
  • Record EBITDA of $12.4mm vs. $6.4mm, +94% 

Q2 2018 sales of $27.0mm increased 5% (+6% organic) vs. Q2 2017.  Patches, shunts and allografts led growth.  Sales in Europe/Middle East/Africa and Asia/Pac Rim were up 12% and 21% respectively, while sales in the Americas were flat, due in part to the Reddick divestiture.

Gross margin increased to 70.3% in Q2 2018 from 68.0% in Q2 2017, primarily due to product mix.

Operating income in Q2 2018 was $11.5mm, a 108% increase vs. the year-earlier quarter.  Excluding the one-time gain from the Reddick divestiture, operating income in the quarter was $5.7mm, a 2% increase.  Had the Reddick product lines not been divested, the Company estimates adjusted operating income would have been $6.3mm, a 13% increase vs. the year-earlier quarter (reconciliation below).

George W. LeMaitre, Chairman and CEO said, “We continue to pursue 10% annual reported sales growth and 20% annual operating income growth.”             

Business Outlook 

 Previous Guidance (4/25/2018)Current Guidance
Q3 2018 SalesN/A$25.6mm - $26.4mm
(Midpoint: +5% reported, +9% organic)
Q3 2018 Gross MarginN/A72.0%
Q3 2018 Operating IncomeN/A$5.3mm - $5.9mm
(Midpoint: +10%)
Q3 2018 Earnings Per ShareN/A$0.20 - $0.22
(Midpoint: -17%)
2018 Sales$106.0mm - $109.0mm
(Midpoint: +7% reported, +6% organic)
$105.3mm - $107.9mm
(Midpoint: +6% reported, +7% organic)
2018 Gross Margin71.0%71.3%
2018 Operating Income$27.9mm - $30.0mm
(Midpoint: +37%)
$27.6mm - $29.4mm
(Midpoint: +35%)
2018 Earnings Per Share$1.05 - $1.13
(Midpoint: +27%)
$1.04 - $1.11
(Midpoint: +25%)
   

Changes to 2018 guidance since the Company’s April 25, 2018 conference call were primarily driven by fluctuations in foreign currency exchange rates.

Divestiture of General Surgery Product Lines

On April 5, 2018, the Company divested its general surgery product lines to Symmetry Surgical, Inc. for $7.4 million, which resulted in a $5.9mm gain.  Included in the divestiture were the Reddick Cholangiogram Catheter and Reddick Saye-Screw, neither of which were sold to the company’s core customer, the vascular surgeon.  In 2017, these product lines accounted for $3.3 million in revenue and $2.5 million in gross profit.

Quarterly Dividend

On July 23, 2018, the Company's Board of Directors approved a quarterly dividend of $0.07/share of common stock. The dividend will be paid September 6, 2018 to shareholders of record on August 22, 2018.

Conference Call Reminder

Management will conduct a conference call at 5:00pm ET today to review the Company's financial results and discuss its business outlook for the remainder of the year. The conference call will be broadcast live over the Internet. Individuals who are interested in listening to the webcast should log on to the Company's website at www.lemaitre.com/investor. The conference call may also be accessed by dialing 844-239-5284 (+1 512-961-6497 for international callers), using passcode 6679847. For individuals unable to join the live conference call, a replay will be available on the Company's website.

A reconciliation of GAAP to non-GAAP results is included in the tables attached to this release.

About LeMaitre Vascular

LeMaitre Vascular is a provider of devices, implants and services for the treatment of peripheral vascular disease, a condition that affects more than 200 million people worldwide. The Company develops, manufactures and markets disposable and implantable vascular devices to address the needs of its core customer, the vascular surgeon.

LeMaitre and the LeMaitre Vascular logo are registered trademarks of LeMaitre Vascular, Inc. This press release contains other trademarks and trade names of the Company.

For more information about the Company, please visit http://www.lemaitre.com.

Use of Non-GAAP Financial Measures

LeMaitre Vascular management believes that in order to better understand the Company's short-term and long-term financial trends, investors may wish to consider certain non-GAAP financial measures as a supplement to financial performance measures prepared in accordance with GAAP. Non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and do not have standardized meanings. These non-GAAP measures result from facts and circumstances that may vary in frequency and/or impact on continuing operations. Non-GAAP measures should be considered in addition to, and not as a substitute for, financial performance measures in accordance with GAAP. In addition to the description provided below, reconciliation of GAAP to non-GAAP results is provided in the financial statement tables included in this press release.

In this press release, the Company has reported non-GAAP sales growth percentages after adjusting for the impact of foreign currency exchange, business development transactions, and/or other events as well as EBITDA or earnings before interest, taxes, depreciation and amortization. The Company refers to the calculation of non-GAAP sales percentages as "organic." The Company analyzes non-GAAP sales on a constant currency basis, net of acquisitions and other non-recurring events, and EBITDA to better measure the comparability of results between periods. Because changes in foreign currency exchange rates have a non-operating impact on net sales, and acquisitions, product discontinuations, and other strategic transactions are episodic in nature and are highly variable to the reported sales results, the Company believes that evaluating growth in sales on a constant currency basis net of such transactions provides an additional and meaningful assessment of sales to management. The Company believes that evaluating EBITDA provides an approximation of the cash generating ability of its operations.

In addition, the Company has presented in this press release two additional non-GAAP measures.  The first presents operating income excluding the one-time gain from the Reddick divestiture.  The second non-GAAP measure, "adjusted operating income," was calculated by approximating the Company’s operating income had the divestiture of the Reddick product lines not occurred.  In order to do so, the Company i) excluded the one-time gain resulting from the sale of the assets as well as gross profits associated with contract services to Symmetry Surgical, Inc. and ii) added back estimated lost gross profits from the product lines divested as well as transaction costs.  You should not view operating income excluding the one-time gain or adjusted operating income as a substitute for operating income determined in accordance with GAAP.  However, Company management believes that the presentation of operating income excluding the one-time gain provides a view of the Company’s results of operations excluding a non-recurring event and adjusted operating income provides an understanding of the Company’s results of operations in the absence of the Reddick divestiture.

Forward-Looking Statements

The Company's current financial results, as discussed in this release, are preliminary and unaudited, and subject to adjustment. This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Statements in this press release regarding the Company's business that are not historical facts may be "forward-looking statements" that involve risks and uncertainties. Specifically, forward-looking statements in this release include, but are not limited to, statements about the Company's expectations regarding Q3 2018 and 2018 sales, gross margin, operating income and earnings per share. Forward-looking statements are based on management's current, preliminary expectations and are subject to risks and uncertainties that could cause actual results to differ from the results expected, including, but not limited to, the risk of significant fluctuations in our quarterly and annual results due to numerous factors; the risk that we may not be able to maintain our recent levels of profitability; the risk that the Company may not realize the anticipated benefits of its strategic activities; the risk that assumptions about the market for the Company's products and the productivity of the Company's direct sales force and distributors may not be correct; risks related to the integration of acquisition targets; risks related to product demand and market acceptance of the Company's products and pricing; the risk that a recall of our products could result in significant costs or negative publicity; the risk that the Company is not successful in transitioning to a direct-selling model in new territories; and other risks and uncertainties included under the heading "Risk Factors" in our most recent Annual Report on Form 10-K, as updated by our subsequent filings with the SEC, all of which are available on the Company's investor relations website at http://www.lemaitre.com and on the SEC's website at http://www.sec.gov. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date they were made, or to reflect the occurrence of unanticipated events.

CONTACT: J.J. Pellegrino, CFO
LeMaitre Vascular
781-425-1691
jjpellegrino@lemaitre.com


       
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)      
CONDENSED CONSOLIDATED BALANCE SHEETS       
(amounts in thousands)      
       
       
  June 30, 2018  December 31, 2017 
  (unaudited)    
Assets      
       
Current assets:      
Cash and cash equivalents $  19,638  $  19,096 
Short-term marketable securities   33,298    22,564 
Accounts receivable, net   15,230    15,000 
Inventory and other deferred costs   21,669    21,046 
Prepaid expenses and other current assets   2,529    2,605 
Total current assets   92,364    80,311 
       
Property and equipment, net   12,235    12,378 
Goodwill   23,602    23,844 
Other intangibles, net   7,358    8,234 
Deferred tax assets   1,347    1,378 
Other assets   194    178 
       
Total assets $  137,100  $  126,323 
       
       
Liabilities and stockholders' equity      
       
Current liabilities:      
Accounts payable $  1,657  $  1,543 
Accrued expenses   11,286    9,770 
Acquisition-related obligations    172    1,876 
Total current liabilities   13,115    13,189 
       
Deferred tax liabilities   2,175    2,176 
Other long-term liabilities   1,066    1,188 
Total liabilities   16,356    16,553 
       
Stockholders' equity      
Common stock   208    207 
Additional paid-in capital   95,122    93,127 
Retained earnings    38,234    28,333 
Accumulated other comprehensive loss   (3,207)   (2,289)
Treasury stock   (9,613)   (9,608)
Total stockholders' equity   120,744    109,770 
       
Total liabilities and stockholders' equity $  137,100  $  126,323 
       


             
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)            
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS           
(amounts in thousands, except per share amounts)            
(unaudited)            
             
             
 For the three months ended
   For the six months ended
 
 June 30, 2018  June 30, 2017   June 30, 2018  June 30, 2017 
             
Net sales$  27,020  $  25,753   $  53,014  $  49,892 
Cost of sales  8,028    8,237     15,548    15,023 
             
Gross profit  18,992    17,516     37,466    34,869 
             
Operating expenses:            
Sales and marketing  6,792    6,599     13,882    13,553 
General and administrative  4,547    3,747     9,244    8,295 
Research and development  1,988    1,634     3,813    3,292 
Gain on divestiture  (5,876)   -     (5,876)   - 
             
             
Total operating expenses  7,451    11,980     21,063    25,140 
             
Income from operations  11,541    5,536     16,403    9,729 
             
Other income:            
Other income (loss), net  6    (70)    60    (24)
             
Income before income taxes  11,547    5,466     16,463    9,705 
             
Provision for income taxes  2,796    834     3,859    1,854 
             
Net income $  8,751  $  4,632   $  12,604  $  7,851 
             
Earnings per share of common stock            
Basic$  0.45  $  0.25   $  0.65  $  0.42 
Diluted$  0.43  $  0.23   $  0.62  $  0.40 
             
Weighted - average shares outstanding:            
Basic  19,320    18,816     19,301    18,724 
Diluted  20,260    19,975     20,243    19,855 
             
             
Cash dividends declared per common share $  0.070  $  0.055   $  0.140  $  0.110 
             


                 
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)             
SELECTED NET SALES INFORMATION               
(amounts in thousands)                
(unaudited)                
                 
                 
 For the three months ended   For the six months ended 
 June 30, 2018 June 30, 2017  June 30, 2018 June 30, 2017
 $ % $ %  $ % $ %
Net Sales by Geography                
Americas$  16,082 59% $  16,088 62%  $  31,942 60% $  31,069 62%
Europe/Middle East/Africa  9,074 34%   8,121 32%    17,829 34%   15,734 32%
Asia/Pacific Rim  1,864 7%   1,544 6%    3,243 6%   3,089 6%
Total Net Sales$  27,020 100% $  25,753 100%  $  53,014 100% $  49,892 100%
                 


             
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)            
NON-GAAP FINANCIAL MEASURES            
(amounts in thousands)            
(unaudited)            
             
             
Reconciliation between GAAP and Non-GAAP sales growth:            
For the three months ended June 30, 2018            
Net sales as reported $  27,020          
Impact of currency exchange rate fluctuations   (701)         
Net impact of acquisitions excluding currency   -          
Adjusted net sales    $  26,319       
             
For the three months ended June 30, 2017            
Net sales as reported $  25,753          
Net impact of divestitures excluding currency   (807)         
Adjusted net sales    $  24,946       
             
Adjusted net sales increase for the three months ended June 30, 2018   $  1,373  6%    
             
             
Reconciliation between GAAP and Non-GAAP sales growth:            
For the three months ended September 30, 2018            
Net sales per guidance $  26,000          
Impact of currency exchange rate fluctuations   90          
Net impact of acquisitions excluding currency   -          
Adjusted net sales    $  26,090       
             
For the three months ended September 30, 2017            
Net sales as reported $  24,822          
Net impact of divestitures excluding currency   (830)         
Adjusted net sales    $  23,992       
             
Adjusted net sales increase for the three months ended September 30, 2018   $  2,098  9%    
             
             
Reconciliation between GAAP and Non-GAAP sales growth:            
For the year ended December 31, 2018            
Net sales per guidance $  106,614          
Impact of currency exchange rate fluctuations   (1,728)         
Net impact of acquisitions excluding currency   -          
Adjusted net sales    $  104,886       
             
For the year ended December 31, 2017            
Net sales as reported $  100,867          
Net impact of divestitures excluding currency   (2,447)         
Adjusted net sales    $  98,420       
             
Adjusted net sales increase for the year ended December 31, 2018    $  6,466  7%    
             
             
             
  For the three months ended
  For the six months ended
 
  June 30, 2018  June 30, 2017  June 30, 2018  June 30, 2017 
Reconciliation between GAAP and Non-GAAP EBITDA            
Net income as reported $  8,751  $  4,632  $  12,604  $  7,851 
Interest (income) expense, net   (164)   (32)   (260)   (52)
Amortization and depreciation expense   1,066    983    2,102    1,962 
Provision for income taxes   2,796    834    3,859    1,854 
             
EBITDA $  12,449  $  6,417  $  18,305  $  11,615 
             
EBITDA percentage increase    94%     58% 
             


        
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)       
NON-GAAP FINANCIAL MEASURES       
(amounts in thousands)       
(unaudited)       
        
        
Reconciliation between GAAP and Non-GAAP operating income excluding Reddick divestiture gain:       
For the three months ended June 30, 2018       
Operating income as reported $  11,541     
Impact of Reddick divestiture gain   (5,876)    
Operating income adjusted for divestiture gain    $  5,665  
        
For the three months ended June 30, 2017       
Operating income as reported $  5,536     
Operating income    $  5,536  
        
Operating income increase for the three months ended June 30, 2018 adjusted for divesture gain     $  129 2%
        
        
Reconciliation between GAAP and Non-GAAP operating income excluding all effects of Reddick divestiture:      
For the three months ended June 30, 2018       
Operating income as reported $  11,541     
Impact of Reddick divestiture gain   (5,876)    
Net impact of gross profit from Reddick divestiture   415     
Net impact of Reddick transaction costs   170     
Adjusted operating income    $  6,250  
        
For the three months ended June 30, 2017       
Operating income as reported $  5,536     
Operating income    $  5,536  
        
Adjusted operating income increase for the three months ended June 30, 2018     $  714 13%
        
Thursday, July 26, 2018 - 16:05