LeMaitre Vascular Announces Q1 2019 Financial Results


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 SalesN/A$28.4mm - $29.2mm
(Midpoint:+7% reported, +4% organic)
Q2 2019 Gross MarginN/A68.3%
Q2 2019 Operating IncomeN/A$5.1mm - $5.7mm
(Midpoint: -53%)
(Midpoint Ex-Special Items: +1%)
Q2 2019 Earnings Per ShareN/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 Margin69.5%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%