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Press Release

LeMaitre Vascular Announces Q3 2020 Financial Results

October 29, 2020 at 4:05 PM EDT

BURLINGTON, Mass., Oct. 29, 2020 (GLOBE NEWSWIRE) -- LeMaitre Vascular, Inc. (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q3 2020 results and announced a $0.095/share quarterly dividend.

Q3 2020 Results

  • Sales of $36.4mm, +25% (-3% organic) vs. Q3 2019
  • Op. income of $10.0mm, +70%
  • Op. margin of 28%
  • Net income of $7.5mm, +45%
  • Earnings of $0.37 per diluted share, +44%
  • EBITDA of $12.6mm, +79%
  • Cash & equivalents up $9.3mm to $34.4mm
  • Debt down $4.5mm to $60.5mm

The Company posted sales growth in the Americas (+37%), Asia/Pac (+12%) and Europe/Middle East/Africa (+6%). The three recent acquisitions (Artegraft, CardioCel and Eze-Sit) and the return of elective surgery drove growth.

Gross margin decreased to 62.3% in Q3 2020 (vs. 69.3% in Q3 2019) primarily due to Artegraft purchase-price accounting.

Operating expenses decreased 11% to $12.7mm in Q3 2020 (vs. $14.3mm). This decline was driven by COVID-related cost-cuts, including reduced sales & marketing expenses.

Chairman & CEO George LeMaitre said, “Record sales in Q3 and tight expense control led to healthy bottom-line results and an improved balance sheet.”  

Business Outlook

  Guidance
Q4 2020 Sales $34.0mm - $38.0mm
(Midpoint:+19%)
Q4 2020 Gross Margin 65.5%
Q4 2020 Operating Income $7.1mm - $9.7mm
(Midpoint:+70%)
Q4 2020 Earnings Per Share $0.25 - $0.35
(Midpoint: +32%)
2020 Sales $125.8mm - $129.8mm
(Midpoint:+9%)
2020 Gross Margin 65.6%
2020 Operating Income $26.3mm - $28.9mm
(Midpoint:+30%)
2020 Earnings Per Share $0.94 - $1.04
(Midpoint: +12%)

Quarterly Dividend

On October 20, 2020, the Company's Board of Directors approved a quarterly dividend of $0.095/share of common stock. The dividend will be paid on December 3, 2020 to shareholders of record on November 19, 2020.

Share Repurchase Program

On February 13, 2020, 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, 2021, unless extended by the Board.

Conference Call Reminder

Management will conduct a conference call at 5:00 p.m. ET today to review the Company's Q3 2020 financial results. The conference call will be broadcast live over the Internet. Individuals interested in listening to the webcast can 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 4052529. 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 may include 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 growth 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, divestitures, 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 reported non-GAAP outstanding debt, which excludes the impact of unamortized deferred financing costs. The Company believes that considering its debt in this manner provides a view of the amount owed on a cash basis.

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. 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 duration and severity of the impact of COVID-19 on the global economy, our customers, our suppliers and our company; the duration of the lapse in CE mark approval for certain of our devices; compliance with foreign regulatory requirements to market and sell our products outside the United States; the risk of significant fluctuations in our quarterly and annual results due to numerous factors; 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; 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; risks related to the integration of acquisition targets; the acceleration or deceleration of product growth rates; 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, 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.


             
LEMAITRE VASCULAR, INC (NASDAQ: LMAT)          
CONDENSED CONSOLIDATED BALANCE SHEETS        
(amounts in thousands)          
             
             
      September 30, 2020   December 31, 2019  
      (unaudited)      
Assets          
             
Current assets:          
  Cash and cash equivalents   $ 29,279     $ 11,786    
  Short-term marketable securities     5,097       20,895    
  Accounts receivable, net     19,625       16,572    
  Inventory and other deferred costs     45,639       39,527    
  Prepaid expenses and other current assets     2,612       3,312    
Total current assets     102,252       92,092    
             
Property and equipment, net     14,133       14,854    
Right-of-use leased assets     16,373       15,208    
Goodwill     65,945       39,951    
Other intangibles, net     60,539       24,893    
Deferred tax assets     1,385       1,084    
Other assets     942       259    
             
Total assets   $ 261,569     $ 188,341    
             
             
Liabilities and stockholders' equity          
             
Current liabilities:          
  Current portion of long-term debt   $ 2,250     $ -    
  Revolving line of credit     21,000       -    
  Accounts payable     2,168       2,604    
  Accrued expenses     14,679       14,014    
  Acquisition-related obligations     2,543       2,476    
  Lease liabilities - short-term     1,806       1,757    
Total current liabilities     44,446       20,851    
             
Long-term debt     36,229       -    
Lease liabilities - long-term     15,192       13,955    
Deferred tax liabilities     90       1,179    
Other long-term liabilities     4,629       4,215    
Total liabilities     100,586       40,200    
             
Stockholders' equity          
  Common stock     218       217    
  Additional paid-in capital     109,640       105,934    
  Retained earnings     65,457       57,029    
  Accumulated other comprehensive loss     (3,009 )     (4,007 )  
  Treasury stock     (11,323 )     (11,032 )  
Total stockholders' equity     160,983       148,141    
             
Total liabilities and stockholders' equity   $ 261,569     $ 188,341    
             



  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 nine months ended  
    September 30, 2020   September 30, 2019   September 30, 2020   September 30, 2019  
                   
Net sales $ 36,416     $ 29,100     $ 91,818     $ 87,062  
Cost of sales   13,712       8,934       31,602       27,117  
                   
Gross profit   22,704       20,166       60,216       59,945  
                   
Operating expenses:                
  Sales and marketing   5,157       7,429       17,788       22,887  
  General and administrative   5,901       4,551       16,425       14,026  
  Research and development   2,098       2,281       7,230       6,777  
  Gain on sale of building   (470 )     -       (470 )     -  
                   
                   
Total operating expenses   12,686       14,261       40,973       43,690  
                   
Income from operations   10,018       5,905       19,243       16,255  
                   
Other income:                
  Interest expense   (665 )     -       (732 )     -  
  Other income (loss), net   25       (15 )     (86 )     236  
                   
Income before income taxes   9,378       5,890       18,425       16,491  
                   
Provision for income taxes   1,865       706       4,238       3,170  
                   
Net income $ 7,513     $ 5,184     $ 14,187     $ 13,321  
                   
Earnings per share of common stock                
  Basic $ 0.37     $ 0.26     $ 0.70     $ 0.68  
  Diluted $ 0.37     $ 0.25     $ 0.69     $ 0.66  
                   
Weighted - average shares outstanding:                
  Basic   20,254       19,871       20,201       19,731  
  Diluted   20,474       20,378       20,434       20,258  
                   
                   
Cash dividends declared per common share $ 0.095     $ 0.085     $ 0.285     $ 0.255  
                   



                                   
  LEMAITRE VASCULAR, INC (NASDAQ: LMAT)                          
  SELECTED NET SALES INFORMATION                            
  (amounts in thousands)                                
  (unaudited)                                
                                   
                                   
    For the three months ended   For the nine months ended  
    September 30, 2020   September 30, 2019   September 30, 2020   September 30, 2019  
    $   %   $   %   $   %   $   %  
Net Sales by Geography                                
  Americas $ 24,184   66 %   $ 17,698   61 %   $ 57,462   63 %   $ 51,584   59 %  
  Europe/Middle East/Africa   10,039   28 %     9,452   32 %     28,339   31 %     29,479   34 %  
  Asia/Pacific Rim   2,193   6 %     1,950   7 %     6,017   6 %     5,999   7 %  
Total Net Sales $ 36,416   100 %   $ 29,100   100 %   $ 91,818   100 %   $ 87,062   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 September 30, 2020                  
    Net sales as reported   $ 36,416                
    Impact of currency exchange rate fluctuations     (484 )              
    Net impact of acquisitions excluding currency     (7,584 )              
        Adjusted net sales       $ 28,348            
                       
  For the three months ended September 30, 2019                  
    Net sales as reported   $ 29,100                
        Adjusted net sales       $ 29,100            
                       
    Adjusted net sales increase for the three months ended September 30, 2020   $ (752 )     -3 %      
                       
                       
Reconciliation between GAAP and non-GAAP debt outstanding:                  
  As of September 30, 2020                  
    Debt as reported   $ 59,479                
    Add back unamortized deferred financing costs     1,021                
    Adjusted debt outstanding       $ 60,500            
                       
                       
                       
        For the three months ended   For the nine months ended  
        September 30, 2020   September 30, 2019   September 30, 2020   September 30, 2019  
Reconciliation between GAAP and Non-GAAP EBITDA                  
  Net income as reported   $ 7,513     $ 5,184     $ 14,187     $ 13,321    
  Interest (income) expense, net     650       (193 )     537       (574 )  
  Amortization and depreciation expense     2,599       1,345       5,778       3,975    
  Provision for income taxes     1,865       706       4,238       3,170    
                       
  EBITDA   $ 12,627     $ 7,042     $ 24,740     $ 19,892    
                       
  EBITDA percentage increase         79 %         24 %  
                       

 




 

 


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

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Source: LeMaitre Vascular, Inc.