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Press Release

LeMaitre Vascular Announces Q1 2019 Financial Results

May 1, 2019 at 4:05 PM EDT

BURLINGTON, Mass., May 01, 2019 (GLOBE NEWSWIRE) -- LeMaitre Vascular, Inc. (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q1 2019 results, provided guidance, and announced a $0.085/share dividend.

Q1 2019 Results

  • Record sales of $28.5mm, +10% (+7% organic) vs. Q1 2018
  • Operating income of $4.4mm vs. $4.9mm, -9%
  • Net income of $3.5mm vs. $3.9mm, -9%
  • Earnings of $0.17 per diluted share vs. $0.19, -9%
  • EBITDA of $5.6mm vs. $5.9mm, -4%

The Company posted record Q1 2019 sales in both Europe/Middle East/Africa (+14%) and Asia/Pac (+52%). Sales in the Americas were up 3%. Sales were driven by embolectomy catheters, OEM, polyester grafts and carotid shunts. 

Gross margin decreased to 68.3% in Q1 2019 from 71.1% in Q1 2018, primarily due to the two recent acquisitions and the strong US dollar.

Operating expenses in Q1 2019 were $15.0mm (+10% vs. Q1 2018) driven by more reps (to 109) and R&D (8% of sales).

George W. LeMaitre, Chairman and CEO said, “Based on 10% Q1 sales growth, we’re increasing our full year guidance. Q1 growth was due to our increasing international footprint and the two recent acquisitions.”

Business Outlook

  Previous Guidance (2/19/2019) Current Guidance
Q2 2019 Sales N/A $28.4mm - $29.2mm
(Midpoint:+7% reported, +4% organic)
Q2 2019 Gross Margin N/A 68.3%
Q2 2019 Operating Income N/A $5.1mm - $5.7mm
(Midpoint: -53%)
(Midpoint Ex-Special Items: +1%)
Q2 2019 Earnings Per Share N/A $0.20 - $0.22
(Midpoint: -50%)
(Midpoint Ex-Special Items: +6%)
2019 Sales $113.0mm - $114.4mm
(Midpoint: +8% reported, +5% organic)
$113.5mm - $114.7mm
(Midpoint: +8% reported, +6% organic)
2019 Gross Margin 69.5% 68.5%
2019 Operating Income $22.1mm - $23.1mm
(Midpoint: -20%)
(Midpoint Ex-Special Items: +9%)
$20.9mm - $21.7mm
(Midpoint: -25%)
(Midpoint Ex-Special Items: +4%)
2019 Earnings Per Share $0.82 - $0.86
(Midpoint: -26%)
(Midpoint Ex-Special Items: +1%)
$0.82 - $0.86
(Midpoint: -26%)
(Midpoint Ex-Special Items: +2%)

Quarterly Dividend

On April 29, 2019, the Company's Board of Directors approved a quarterly dividend of $0.085/share of common stock. The dividend will be paid on June 6, 2019 to shareholders of record on May 22, 2019.

Share Repurchase Program

On February 14, 2019, the Company's Board of Directors authorized the repurchase of up to $10.0mm of the Company’s common stock.  The repurchase program may be suspended or discontinued at any time and will conclude on February 14, 2020, unless extended by the Board.

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 6398939. 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.

The Company has also identified the percentage change in its projected Q2 2019 and full year 2019 operating income and earnings per share excluding “special items.”  Those special items excluded from Q2 2018 and full year 2018 operating income are the gains on the Company’s 2018 acquisitions and divestitures and those special items excluded from projected Q2 2019 and full year 2019 operating income are 2019 restructuring charges.  Those special items excluded from Q2 2018 and full year 2018 earnings per share are the gains on the Company’s 2018 acquisitions and divestitures, net of tax, and those special items excluded from projected Q2 2019 and full year 2019 earnings per share are 2019 restructuring charges, net of tax.  Because acquisitions, divestitures and restructurings are episodic in nature and are highly variable to the Company’s results, the Company believes that evaluating its profitability net of such transactions and events provides an additional and meaningful assessment of profitability to management.

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 Q2 2019 and 2019 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 including the acceleration or deceleration of product growth rates; 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 the Company’s ability to attain or maintain regulatory approvals for its products; 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, which are all 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)
           
           
      March 31, 2019   December 31, 2018
      (unaudited)    
Assets        
           
Current assets:        
  Cash and cash equivalents   $ 14,766     $ 26,318  
  Short-term marketable securities     32,691       21,668  
  Accounts receivable, net     15,460       15,721  
  Inventory and other deferred costs     29,408       27,388  
  Prepaid expenses and other current assets     3,093       2,922  
Total current assets     95,418       94,017  
           
Property and equipment, net     14,109       14,102  
Right-of-use leased assets     6,266       -  
Goodwill     29,880       29,868  
Other intangibles, net     13,179       13,692  
Deferred tax assets     1,190       1,215  
Other assets     210       194  
           
Total assets   $ 160,252     $ 153,088  
           
           
Liabilities and stockholders' equity        
           
Current liabilities:        
  Accounts payable   $ 2,381     $ 1,732  
  Accrued expenses     13,372       15,847  
  Acquisition-related obligations     2,194       2,179  
  Lease liabilities - short-term     1,438       -  
Total current liabilities     19,385       19,758  
           
Lease liabilities - long-term     5,263       -  
Deferred tax liabilities     484       484  
Other long-term liabilities     2,032       2,611  
Total liabilities     27,164       22,853  
           
Stockholders' equity        
  Common stock     212       211  
  Additional paid-in capital     99,666       98,442  
  Retained earnings     47,672       45,831  
  Accumulated other comprehensive loss     (4,092 )     (3,900 )
  Treasury stock     (10,370 )     (10,349 )
Total stockholders' equity     133,088       130,235  
           
Total liabilities and stockholders' equity   $ 160,252     $ 153,088  
           

 

         
  LEMAITRE VASCULAR, INC (NASDAQ: LMAT)    
  CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS    
  (amounts in thousands, except per share amounts)      
  (unaudited)      
         
    For the three months ended
    March 31, 2019   March 31, 2018
         
Net sales $ 28,479   $ 25,994
Cost of sales   9,015     7,520
         
Gross profit   19,464     18,474
         
Operating expenses:      
  Sales and marketing   7,845     7,090
  General and administrative   4,944     4,697
  Research and development   2,240     1,825
         
         
Total operating expenses   15,029     13,612
         
Income from operations   4,435     4,862
         
Other income:      
  Other income (loss), net   78     54
         
Income before income taxes   4,513     4,916
         
Provision for income taxes   1,000     1,063
         
Net income $ 3,513   $ 3,853
         
Earnings per share of common stock      
  Basic $ 0.18   $ 0.20
  Diluted $ 0.17   $ 0.19
         
Weighted - average shares outstanding:      
  Basic   19,640     19,283
  Diluted   20,205     20,181
         
         
Cash dividends declared per common share $ 0.085   $ 0.070
         

 

                 
  LEMAITRE VASCULAR, INC (NASDAQ: LMAT)        
  SELECTED NET SALES INFORMATION            
  (amounts in thousands)              
  (unaudited)              
                 
                 
    For the three months ended 
    March 31, 2019   March 31, 2018
    $   %   $   %
Net Sales by Geography              
  Americas $ 16,375   58 %   $ 15,860   61 %
  Europe/Middle East/Africa   10,013   35 %     8,755   34 %
  Asia/Pacific Rim   2,091   7 %     1,379   5 %
Total Net Sales $ 28,479   100 %   $ 25,994   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 March 31, 2019                  
    Net sales as reported   $ 28,479                
    Impact of currency exchange rate fluctuations     910                
    Net impact of acquisitions excluding currency     (2,272 )              
    Adjusted net sales       $ 27,117            
                       
  For the three months ended March 31, 2018                  
    Net sales as reported   $ 25,994                
    Net impact of divestitures excluding currency     (736 )              
    Adjusted net sales       $ 25,258            
                       
    Adjusted net sales increase for the three months ended March 31, 2019   $ 1,859     7 %      
                       
                       
Reconciliation between GAAP and Non-GAAP projected sales growth:                  
  For the three months ended June 30, 2019                  
    Net sales per guidance   $ 28,840                
    Impact of currency exchange rate fluctuations     693                
    Net impact of acquisitions excluding currency     (1,500 )              
    Adjusted projected net sales       $ 28,033            
                       
  For the three months ended June 30, 2018                  
    Net sales as reported   $ 27,020                
    Net impact of divestitures excluding currency     (51 )              
    Adjusted net sales       $ 26,969            
                       
    Adjusted projected net sales increase for the three months ended June 30, 2019   $ 1,064     4 %      
                       
                       
Reconciliation between GAAP and Non-GAAP projected sales growth:                  
  For the year ended December 31, 2019                  
    Net sales per guidance   $ 114,100                
    Impact of currency exchange rate fluctuations     2,088                
    Net impact of acquisitions excluding currency     (5,417 )              
    Adjusted net sales       $ 110,771            
                       
  For the year ended December 31, 2018                  
    Net sales as reported   $ 105,568                
    Net impact of divestitures excluding currency     (787 )              
    Adjusted net sales       $ 104,781            
                       
    Adjusted projected net sales increase for the year ended December 31, 2019   $ 5,990     6 %      
                       
                       
Reconciliation between GAAP and Non-GAAP operating income:                  
  For the three months ended June 30, 2019                  
    Operating income per guidance   $ 5,398                
    Add back restructuring charge     300                
    Adjusted projected operating income       $ 5,698            
                       
  For the three months ended June 30, 2018                  
    Operating income as reported   $ 11,541                
    Impact of gains on acquisitions and divestitures     (5,876 )              
    Adjusted operating income       $ 5,665            
                       
    Adjusted projected operating income increase for the three months ended June 30, 2019       $ 33     1 %      
                       
                       
                       
                       
Reconciliation between GAAP and Non-GAAP projected operating income:                
  For the year ended December 31, 2019                  
    Operating income per guidance   $ 21,267                
    Add back restructuring charge     300                
    Adjusted projected operating income       $ 21,567            
                       
  For the year ended December 31, 2018                  
    Operating income as reported   $ 28,209                
    Impact of gains on acquisitions and divestitures     (7,474 )              
    Adjusted operating income       $ 20,735            
                       
    Adjusted projected operating income increase for the year ended December 31, 2019       $ 832     4 %      
                       
                       
Reconciliation between GAAP and Non-GAAP projected earnings per share:                
  For the three months ended June 30, 2019                  
    Earnings per share per guidance   $ 0.21                
    Add back earnings per share from restructuring charge, net of tax     0.01                
    Adjusted earnings per share       $ 0.23            
                       
  For the three months ended June 30, 2018                  
    Earnings per share as reported   $ 0.43                
    Less earnings per share from gains on acquisitions and divestitures, net of tax     (0.22 )              
    Adjusted earnings per share       $ 0.21            
                       
    Adjusted projected earnings per share increase for the three months ended June 30, 2019       $ 0.01     6 %      
                       
                       
Reconciliation between GAAP and Non-GAAP projected earnings per share:                
  For the year ended December 31, 2019                  
    Earnings per share per guidance   $ 0.84                
    Add back earnings per share from restructuring charge, net of tax     0.01                
    Adjusted earnings per share       $ 0.85            
                       
  For the year ended December 31, 2018                  
    Earnings per share as reported   $ 1.13                
    Less earnings per share from gains on acquisitions and divestitures, net of tax     (0.30 )              
    Adjusted earnings per share       $ 0.84            
                       
    Adjusted projected earnings per share increase for the year ended December 31, 2019       $ 0.01     2 %      
                       
                       
        For the three months ended     For the twelve months ended  
        March 31, 2019   March 31, 2018       March 31, 2019  
Reconciliation between GAAP and Non-GAAP EBITDA                  
  Net income as reported   $ 3,513     $ 3,853         $ 22,603    
  Interest (income) expense, net     (157 )     (95 )         (691 )  
  Amortization and depreciation expense     1,284       1,036           4,572    
  Provision for income taxes     1,000       1,063           5,438    
                       
  EBITDA   $ 5,640     $ 5,857         $ 31,922    
                       
  EBITDA percentage increase         -4 %          
                       

 

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