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LeMaitre Q4 2016 Record Sales $23.3 mm (+14%), Op. Income $3.9 mm (+27%)

02/21/17

BURLINGTON, Mass., Feb. 21, 2017 (GLOBE NEWSWIRE) -- LeMaitre Vascular, Inc. (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q4 2016 results, provided guidance, and announced a 22% dividend increase to $0.055/share.

Q4 2016 Results

  • Record sales of $23.3mm, +14% vs. Q4 2015
  • Operating income of $3.9mm vs. $3.1mm, +27%
  • Net income of $2.6mm vs. $2.5mm, +3%
  • Earnings of $0.13 per diluted share vs. $0.13
  • EBITDA of $4.8mm vs. $4.0mm, +18%

Q4 2016 sales of $23.3mm increased 14% (+11% organic) vs. Q4 2015.  XenoSure and AnastoClip led growth.  Sales in the Americas were up 17% while international sales increased 9%.

Gross margin decreased to 69.5% in Q4 2016 from 70.3% in Q4 2015 primarily due to product and geographic mix.

Operating expenses in Q4 2016 were $12.3mm, a 9% increase vs. the year-earlier quarter. The Company ended the quarter with 96 sales reps vs. 86 at the end of Q4 2015.

Full Year 2016 Results

  • Sales of $89.2mm, +14% reported (+12% organic) vs. 2015
  • Operating income of $16.3mm vs. $11.5mm, +42%
  • Net income of $10.6mm vs. $7.8mm, +37%
  • EPS of $0.55 per diluted share vs. $0.42, +30%
  • Dividends paid of $0.18 per share vs $0.16, +13%
  • EBITDA of $19.8mm vs. $14.8mm, +34%

 

George W. LeMaitre, Chairman and CEO said, “Sales increased 14% in 2016, while operating income was up 42%.  We continue to pursue 10% annual reported sales growth and 20% annual operating income growth.”             

Business Outlook

Guidance Summary
Q1  2017 Sales $23.5mm
(+16% reported, +12% organic)
Q1  2017 Gross Margin 71.0 %
Q1  2017 Operating Income $3.9mm
(+18%, 17% op. margin)
2017 Sales $99.0mm
(+11% reported, +9% organic)
2017 Gross Margin 71.5 %
2017 Operating Income $20.0mm
(+22%, 20% op. margin)

Acquisition of Restore Flow Allografts

On November 10, 2016, the Company acquired the assets of Restore Flow Allografts, LLC for $14.0 million, of which $12.0 million was paid at closing and $2.0 million is expected to be paid in May 2018.  Additional earnout payments may be paid through 2018 based on performance. 

Restore Flow derives revenue from human tissue preservation services, in particular the cryopreservation of peripheral vascular veins and arteries.  Prior to the acquisition, last twelve months’ revenue for Restore Flow was $3.7mm, all within the United States.  Last twelve months’ operating income for Restore Flow was approximately break-even.

Quarterly Dividend

On February 16, 2017, the Company's Board of Directors approved an increased quarterly dividend of $0.055/share of common stock. The dividend will be paid April 6, 2017 to shareholders of record on March 22, 2017.

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 66556990. 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 20 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.

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 Q1 2017 and 2017 sales, gross margin and operating income levels. 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 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 services and the productivity of the Company's direct sales force and distributors may not be correct; risks related to the integration of acquisition targets; the risk that a recall of our products and other offerings could result in significant costs or negative publicity; risks related to product and service demand and market acceptance of the Company's products, services and pricing; the risk that the Company is not successful in transitioning to a direct-selling model in new territories; adverse or fluctuating conditions in the general domestic and global economic markets 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.

           
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)        
CONDENSED CONSOLIDATED BALANCE SHEETS         
(amounts in thousands)        
           
           
      December 31, 2016   December 31, 2015
      (unaudited)    
Assets        
           
Current assets:        
  Cash and cash equivalents   $   24,288     $   27,451  
  Accounts receivable, net       13,191         11,971  
  Inventory and other deferred costs       19,578         15,205  
  Prepaid expenses and other current assets       1,970         3,557  
Total current assets       59,027         58,184  
           
Property and equipment, net       8,012         7,022  
Goodwill       23,426         17,789  
Other intangibles, net       9,897         6,336  
Deferred tax assets       1,399         1,205  
Other assets       163         168  
           
Total assets   $   101,924     $   90,704  
           
           
Liabilities and stockholders' equity        
           
Current liabilities:        
  Accounts payable   $   1,217     $   1,366  
  Accrued expenses       8,804         8,837  
  Acquisition-related obligations        461         165  
Total current liabilities       10,482         10,368  
           
Deferred tax liabilities       1,941         1,678  
Other long-term liabilities       2,001         774  
Total liabilities       14,424         12,820  
           
Stockholders' equity        
  Common stock       200         197  
  Additional paid-in capital       85,378         82,094  
  Retained earnings        15,335         8,161  
  Accumulated other comprehensive loss       (4,583 )       (4,049 )
  Treasury stock       (8,830 )       (8,519 )
Total stockholders' equity       87,500         77,884  
           
Total liabilities and stockholders' equity   $   101,924     $   90,704  

 

  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 year ended  
    December 31, 2016   December 31, 2015   December 31, 2016   December 31, 2015  
                   
Net sales $   23,288     $   20,483     $   89,151     $   78,352    
Cost of sales     7,094         6,080         26,215         24,186    
                   
Gross profit     16,194         14,403         62,936         54,166    
                   
Operating expenses:                
  Sales and marketing     6,753         5,914         26,105         22,780    
  General and administrative     4,011         3,635         14,354         14,010    
  Research and development     1,521         1,575         6,141         5,479    
  Gain on divestiture     -         -         -         (360 )  
  Medical device excise tax     -         190         -         744    
                   
Total operating expenses     12,285         11,314         46,600         42,653    
                   
Income from operations     3,909         3,089         16,336         11,513    
                   
Other income:                
  Other income (loss), net     (75 )       46         (94 )       (89 )  
                   
Income before income taxes     3,834         3,135         16,242         11,424    
                   
Provision for income taxes     1,237         605         5,652         3,666    
                   
Net income  $   2,597     $   2,530     $   10,590     $   7,758    
                   
Earnings per share of common stock                
  Basic $   0.14     $   0.14     $   0.57     $   0.44    
  Diluted $   0.13     $   0.13     $   0.55     $   0.42    
                   
Weighted - average shares outstanding:                
  Basic     18,585         18,175         18,485         17,764    
  Diluted     19,558         18,781         19,241         18,316    
                   
                   
Cash dividends declared per common share  $   0.045     $   0.040     $   0.180     $   0.160    

 

  LEMAITRE VASCULAR, INC (NASDAQ: LMAT)                        
  SELECTED NET SALES INFORMATION                        
  (amounts in thousands)                              
  (unaudited)                              
                                 
                                 
    For the three months ended    For the year ended 
    December 31, 2016   December 31, 2015   December 31, 2016   December 31, 2015
    $   %   $   %   $   %   $   %
Net Sales by Geography                              
  Americas $   14,116   61 %   $   12,105   59 %   $   53,710   60 %   $   47,975   61 %
  International     9,172   39 %       8,378   41 %       35,441   40 %       30,377   39 %
Total Net Sales $   23,288   100 %   $   20,483   100 %   $   89,151   100 %   $   78,352   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 December 31, 2016                
    Net sales as reported   $   23,288              
    Impact of currency exchange rate fluctuations       150              
    Net impact of acquisitions excluding currency       (770 )            
      Adjusted net sales       $   22,668          
                     
  For the three months ended December 31, 2015                
    Net sales as reported   $   20,483              
    Net impact of divestitures excluding currency       (7 )            
      Adjusted net sales       $   20,476          
                     
     Adjusted net sales increase for the three months ended December 31, 2016    $   2,192       11 %    
                     
                     
Reconciliation between GAAP and Non-GAAP sales growth:                
  For the year ended December 31, 2016                
    Net sales as reported   $   89,151              
    Impact of currency exchange rate fluctuations       177              
    Net impact of acquisitions excluding currency       (1,684 )            
      Adjusted net sales       $   87,644          
                     
  For the year ended December 31, 2015                
    Net sales as reported   $   78,352              
    Net impact of divestitures excluding currency       (30 )            
      Adjusted net sales       $   78,322          
                     
     Adjusted net sales increase for the year ended December 31, 2016      $   9,322       12 %    
                     
Reconciliation between GAAP and Non-GAAP sales growth:                
  For the three months ended March 31, 2017                
    Net sales per guidance   $   23,500              
    Impact of currency exchange rate fluctuations       332              
    Net impact of acquisitions excluding currency       (1,195 )            
      Adjusted net sales       $   22,637          
                     
  For the three months ended March 31, 2016                
    Net sales as reported   $   20,258              
    Net impact of divestitures excluding currency       -               
      Adjusted net sales       $   20,258          
                     
     Adjusted net sales increase for the three months ended March 31, 2017    $   2,379       12 %    
                     
                     
Reconciliation between GAAP and Non-GAAP sales growth:                
  For the year ended December 31, 2017                
    Net sales per guidance   $   99,000              
    Impact of currency exchange rate fluctuations       1,605              
    Net impact of acquisitions excluding currency       (3,520 )            
      Adjusted net sales       $   97,085          
                     
  For the year ended December 31, 2016                
    Net sales as reported   $   89,151              
    Net impact of divestitures excluding currency       -               
      Adjusted net sales       $   89,151          
                     
     Adjusted net sales increase for the year ended December 31, 2017      $   7,934       9 %    
                     
                     
                     
        For the three months ended   For the year ended
        December 31, 2016   December 31, 2015   December 31, 2016   December 31, 2015
Reconciliation between GAAP and Non-GAAP EBITDA                
  Net income as reported   $   2,597     $   2,530     $   10,590     $   7,758  
  Interest (income) expense, net       (12 )       (6 )       (67 )       (13 )
  Amortization and depreciation expense       933         897         3,591         3,394  
  Provision for income taxes       1,237         605         5,652         3,666  
                     
  EBITDA   $   4,755     $   4,026     $   19,766     $   14,805  
                     
  EBITDA percentage increase         18 %         34 %
                     

 


 

 

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

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