Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

Current Report

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): July 29, 2014

 

 

LeMaitre Vascular, Inc.

(Exact name of registrant as specified in its charter)

 

 

Commission File Number: 001-33092

 

Delaware   04-2825458

(State or other jurisdiction

of incorporation)

 

(IRS Employer

Identification No.)

63 Second Avenue

Burlington, MA 01803

(Address of principal executive offices, including zip code)

781-221-2266

(Registrant’s telephone number, including area code)

 

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 2.02. Results of Operations and Financial Condition.

On July 29, 2014, LeMaitre Vascular, Inc. (the “Company”) issued a press release regarding its financial and operational results for the second quarter ended June 30, 2014. A copy of the press release is furnished as Exhibit 99.1 to this Report.

The information in this Item 2.02, including Exhibit 99.1 attached hereto, is intended to be furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such filing.

Item 9.01. Financial Statements and Exhibits.

The following exhibits are furnished or filed as part of this Report, as applicable:

 

  (d) Exhibits.

 

Exhibit
No.

  

Description

99.1    Press release issued by LeMaitre Vascular, Inc. on July 29, 2014.


Signature(s)

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

      LeMaitre Vascular, Inc.
Date: July 29, 2014     By:   Joseph P. Pellegrino, Jr.
     

/s/ JOSEPH P. PELLEGRINO, JR.

     

Joseph P. Pellegrino, Jr.

Chief Financial Officer


Exhibit Index

 

Exhibit
No.
   Description
99.1    Press release issued by LeMaitre Vascular, Inc. on July 29, 2014.
EX-99.1

Exhibit 99.1

 

LOGO

For information contact:

J.J. Pellegrino

Chief Financial Officer

LeMaitre Vascular, Inc.

781-425-1691

jpellegrino@lemaitre.com

LeMaitre Q2 2014 Record Sales $18.2mm (+14%) ; Op. Profit $2.0mm (+37%)

BURLINGTON, MA, July 29, 2014 — LeMaitre Vascular, Inc. (NASDAQ: LMAT) today reported Q2 2014 results, provided guidance and announced a $0.035/share dividend.

Q2 2014 sales were $18.2mm, a 14% year-over-year increase, driven by Trivex (acquired Q3 2013) and XenoSure. Geographically, gains came from the Company’s newly-direct markets of Australia & Switzerland and its Mediterranean subsidiaries. Unit sales grew 5% and organic sales improved 6%.

Gross margin improved sequentially from 67.0% in Q1 2014 to 68.1% in Q2 2014, due to ramping XenoSure production, the Southbridge factory closure and manufacturing efficiencies.

Operating income grew 37% to $2.0mm from $1.4mm in Q2 2013, largely due to increased sales. Net income grew to $1.3mm from $0.9mm in Q2 2013. EPS grew to $0.08 from $0.06 in Q2 2013. EBITDA grew to a record $2.8mm from $2.0mm in Q2 2013.

Cash and marketable securities were $23.5mm at June 30, 2014, versus $12.5mm at March 31, 2014. Net proceeds from the June 2014 common stock offering were $10.5mm.

George W. LeMaitre, Chairman and CEO commented, “Record sales drove 37% year-over-year profit growth in Q2, and expenses dropped 10% sequentially as our $5mm/year cost cut took root. We hired a Chinese GM and expect to open our Shanghai office in September.”

Quarterly Dividend

On July 24, 2014, the Company’s Board of Directors approved a quarterly dividend of $0.035/share of common stock. The dividend will be paid September 4, 2014 to shareholders of record on August 21, 2014.


Business Outlook

The Company expects Q3 2014 sales of $17.1mm (+12% vs. Q3 2013) and operating income of $1.4mm (+80% vs Q3 2013). The Company increased its 2014 sales guidance to $70.1mm (+9% vs. 2013) and increased its 2014 operating income guidance to $5.6mm (+24% vs. 2013). 2014 XenoSure sales are expected to be $10.0mm (+30% vs. 2013).

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 2014. 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 800-591-6942 (+1 617-614-4909 for international callers), using pass-code 36553447. 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 (“organic”) results is included in the attached tables.

About LeMaitre Vascular

LeMaitre Vascular is a provider of devices 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, XenoSure, TRIVEX 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 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

 

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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 Q3 2014 and 2014 sales 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 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; the risk that the XenoSure product is not as accretive and does not achieve the gross margins currently anticipated by the Company; the risk that the Company experiences increased expense, production delays or quality difficulties in the transition of the XenoSure manufacturing operations; the risk that the Company is not successful in transitioning to a direct-selling model in new territories; adverse 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.

 

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Financial Statements

LEMAITRE VASCULAR, INC (NASDAQ: LMAT)

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

 

     June 30, 2014     December 31, 2013  
     (unaudited)        

Assets

    

Current assets:

    

Cash and cash equivalents

   $ 23,512      $ 14,711   

Accounts receivable, net

     11,373        10,590   

Inventory

     14,995        13,255   

Prepaid expenses and other current assets

     3,122        3,169   
  

 

 

   

 

 

 

Total current assets

     53,002        41,725   

Property and equipment, net

     5,474        5,810   

Goodwill

     15,031        15,031   

Other intangibles, net

     5,250        6,144   

Deferred tax assets

     1,610        1,615   

Other assets

     169        167   
  

 

 

   

 

 

 

Total assets

   $ 80,536      $ 70,492   
  

 

 

   

 

 

 

Liabilities and stockholders’ equity

    

Current liabilities:

    

Accounts payable

   $ 1,021      $ 1,235   

Accrued expenses

     6,960        7,993   

Acquisition-related obligations

     1,031        992   
  

 

 

   

 

 

 

Total current liabilities

     9,012        10,220   

Deferred tax liabilities

     3,476        3,461   

Other long-term liabilities

     265        249   
  

 

 

   

 

 

 

Total liabilities

     12,753        13,930   

Stockholders’ equity

    

Common stock

     187        170   

Additional paid-in capital

     75,497        65,354   

Retained earnings (accumulated deficit)

     398        (667

Accumulated other comprehensive loss

     (250     (253

Treasury stock

     (8,049     (8,042
  

 

 

   

 

 

 

Total stockholders’ equity

     67,783        56,562   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 80,536      $ 70,492   
  

 

 

   

 

 

 

 

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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, 2014      June 30, 2013     June 30, 2014     June 30, 2013  

Net sales

   $ 18,161       $ 15,951      $ 34,915      $ 31,333   

Cost of sales

     5,785         4,714        11,315        8,890   
  

 

 

    

 

 

   

 

 

   

 

 

 

Gross profit

     12,376         11,237        23,600        22,443   

Operating expenses:

         

Sales and marketing

     5,537         5,305        11,766        11,073   

General and administrative

     3,296         3,067        6,611        5,949   

Research and development

     1,137         1,268        2,481        2,541   

Medical device excise tax

     176         150        340        310   

Restructuring charges

     89         —          492        —     

Impairment Charges

     161         —          161        —     
  

 

 

    

 

 

   

 

 

   

 

 

 

Total operating expenses

     10,396         9,790        21,851        19,873   
  

 

 

    

 

 

   

 

 

   

 

 

 

Income from operations

     1,980         1,447        1,749        2,570   

Other income (loss):

         

Interest income (expense), net

     —           (6     —          (9

Other income (loss), net

     20         (66     (22     (116
  

 

 

    

 

 

   

 

 

   

 

 

 

Income before income taxes

     2,000         1,375        1,727        2,445   

Provision (benefit) for income taxes

     728         486        662        710   
  

 

 

    

 

 

   

 

 

   

 

 

 

Net income

   $ 1,272       $ 889      $ 1,065      $ 1,735   
  

 

 

    

 

 

   

 

 

   

 

 

 

Earnings per share of common stock

         

Basic

   $ 0.08       $ 0.06      $ 0.07      $ 0.11   
  

 

 

    

 

 

   

 

 

   

 

 

 

Diluted

   $ 0.08       $ 0.06      $ 0.07      $ 0.11   
  

 

 

    

 

 

   

 

 

   

 

 

 

Weighted - average shares outstanding:

         

Basic

     16,113         15,250        15,852        15,234   
  

 

 

    

 

 

   

 

 

   

 

 

 

Diluted

     16,545         15,701        16,290        15,676   
  

 

 

    

 

 

   

 

 

   

 

 

 

Cash dividends declared per common share

   $ 0.035       $ 0.030      $ 0.070      $ 0.600   
  

 

 

    

 

 

   

 

 

   

 

 

 

 

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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, 2014     June 13, 2013     June 30, 2014     June 30, 2013  
     $      %     $      %     $      %     $      %  

Net Sales by Geography

                    

Americas

   $ 11,816         65   $ 10,363         65   $ 22,480         64   $ 20,611         66

International

     6,345         35     5,588         35     12,435         36     10,722         34
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

   

 

 

    

 

 

 

Total Net Sales

   $ 18,161         100   $ 15,951         100   $ 34,915         100   $ 31,333         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 ending June 30, 2014

       

Net sales as reported

   $ 18,161        

Impact of currency exchange rate fluctuations

     (207     

Net impact of acquisitions and distributed sales excluding currency

     (1,119     
  

 

 

      

Adjusted net sales

     $ 16,835      

For the three months ending June 30, 2013

       

Net sales as reported

     $ 15,951      
    

 

 

    

Adjusted net sales increase for the three months ending June 30, 2014

     $ 884         6
    

 

 

    

 

 

 

 

     For the three months ended     For the six months ended  
     June 30, 2014      June 30, 2013     June 30, 2014      June 30, 2013  

Reconciliation between GAAP and Non-GAAP EBITDA

          

Net Income, as reported

   $ 1,272       $ 889      $ 1,065       $ 1,735   

Amortization and depreciation expense

     789         641        1,620         1,251   

Interest income (expense), net

     —           (6     —           (9

Provision for income taxes

     728         486        662         710   
  

 

 

    

 

 

   

 

 

    

 

 

 

EBITDA

   $ 2,789       $ 2,010      $ 3,347       $ 3,687   
  

 

 

    

 

 

   

 

 

    

 

 

 

 

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