SSKN - Earnings call transcript Q1 2024 | STRATA Skin Sciences, Inc.

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Operator

Ladies and gentlemen, thank you for standing by. Good afternoon. and welcome to the STRATA Skin Sciences Inc.

First Quarter of 2024 Financial Results and Corporate Update Conference Call. [Operator Instructions] Participants of this call call are advised that the audio of this conference call is being broadcast live over the Internet and is also being recorded for playback purposes. the end be November of of hour approximately XX, replay the after the webcast call available will X XXXX. A call through

over go that, Joey with I'd to the And like Deleuze. ahead. call Please turn to

Unknown Executive

under Good website for call. company this Investors conference in can the Earlier that ended quarter found thank at March afternoon, the financial A afternoon, be results press copy you of and its participating today's for released www.strataskinsciences.com, the the company's XX, on tab. XXXX. release

Joining today's management call Officer; STRATA team Financial from are Lesovitz, Executive Officer. Chris me Chief earnings on Skin Dr. Sciences Dolev and Chief Rafaeli,

During Sciences' this including Skin expectations statements, for forward-looking future operational will call, be performance making . Strata statements that address or management results.

risks results other cause statements. and from those may that to materially involve actual factors Forward-looking differ statements

these annual the XXXX. disclaims factors risk its For The the after press accompanies as Skin update call call. content of XX, information Sciences by this occur information more or time-sensitive is required particularly described most this or on only release Sciences periodic that any and statements information STRATA to filed Sciences report recently subsequent Form Skin obligation it. any as in to about today, STRATA that to revise please and May reports to call. contains refer Skin the accurate cautionary law, of events circumstances in filed that this SEC Except publicly reflect risks, STRATA with XX-K

my Dolev call It over pleasure is to Rafaeli. the turn Dr. now to CEO,

Dolev Rafaeli

everyone for afternoon the Good call. Julie, you, Thank on

psoriasis, we Clinical hundreds and I appointed turnaround eczema. extract proven results continue CEO of for quarter, late [indiscernible] the execute to the multifaceted when year. on was thousands treated across strategy using are patients last coming of introduced our During quarters per and our to device the the first primarily domestic installed base recurring device DTC across utilization XXX and revenue adjusting devices. is increasing focused our device And placements over of strategy approximately extract marketing on extract our drive

a here marketing in strategies, to and we we previous into additional of beyond. been sorted to the the country at XXXX beginning coming my DTC similar STRATA, ramp-up and quarter successful tenure We the have spend During at our program to feel areas. and appointments the first driving expect in DTC results comfortable with region increase limited and of allocation the quarters drive patient our expand geographical in these

cost XXX the expanded targeted original at appointments we a per first of million. under lead to $XXX a in patient have our from per X generated and areas under quarter, appointment over During fix $XX of cost

X,XXX, metrics the first of a XXXX of we each after ] and metrics are achieved XXXX quarter in DTC apply nation when across with in are budget [ campaigns not respectively, with with those line previous XXXX in ramp-up. which DTC quarters spend achieved XX previous full X,XXX to These the DTC. contrast first from of years the line our did STRATA and by in These XX my quarters company the scheduled in X in appointments, appointments stark the

double-digit in quarters and The spend. followed domestic revenue in recurring reminder, periods each first of experienced as both And no of a years XXXX DTC gross strong those XXXX growth.

Another places. strategic optimizing initiative is device extract our

We partners. have underperforming some dermatology

devices both benefit potential clinic these utilization other the demonstrated for underperforming clinics that devices placing settled is with of dermatology instead assets, higher constantly utilization. the from and such staying STRATA in Skin. the clinics and a we So consider removing for Higher have

spend from of and is increased So we significant. underperforming DTC both our of extract looking the are repositioning on extra base utilization always a installed devices our to devices optimize placements,

mid-XXXX in quarter take in transition that turnaround pandemic. to XXXX $X,XXX we for device started the our recurring a will some fourth could COVID $XX,XXX Successful per right -- recurring as strategy average of gross the per in in time revenue fiscal in XXXX, list which device. gross of similar from resulted $XX,XXX, the revenue before This enjoyed reaching XXXX increase execution nearly approximately

The return base million mean efficiencies XXX to process. installed and high-margin $X these allowing of across to in over flow in incremental reach the profitability an our could devices revenue, cash us positive

the evidence and been already may our are that initiatives, We encouraged have are have seen by strategic we impacted our on by business right positively path. that domestic

first our past end making the X% quarter gross XXXX, the year-over-year, X down of XXXX. quarter just domestic since the of recurring second billings quarters year-over-year the In in of the that decline were smallest

quarter billings turn first some business XXXX recurring in recent in quarter of most providing metric that domestic quarter metric can the positive and a was X% of much this upcoming this improvement, was of the optimism quarters, During further the marked turnaround. cementing down in fourth Thus, respectively. the XX% of X XX%, this decline second through quarters, XX%, XXXX smaller gross from XXXX, the

As of successfully base XXXX part opted strategic that model. our at the existing XX end XX% into from the in of of of placed XXXX. first accounts, XXX laser [indiscernible] X domestic represent placed resulted devices the reengage including quarter were that comeback in our STRATA down a with clinics business changes recurring of to into first we partnership extract with that new removed end devices extract XX turnaround, These through and the have at quarter, installed devices accounts

optimization this the upcoming to in quarters. continue expect We

installed grew of our device we continue recurring XX% first the XX, March to from XXX [indiscernible] XXXX base of implementation growing installed Beyond our revenue the at XTRAC, TheraClearX the we XXXX. the of the model. end In base through domestic at quarter, successfully

beginning encouraged CPT the of acne are the to by We surgery code. use clinics uptake

of in week recurring with as quarters. dermatology acne of partners ended with approach are limitations charts XX There reimbursement can million over quarter revenue underlying RDF existing acne per rate insurance at with previous a first to XXX the the unique XTRAC same clinics address The reimbursable the XX U.S. our patients to TheraClearX photo of period in and for drive similar model. and the none the reimbursable compared XX charts submitting at and treatments

international distributors markets with continued is our and same us. exclusive December we our for penetration for XX% revenues. revenue the total the with XXXX, in in Japan. early those revenue, -- agreement in territories late we've Lastly, these of International did an XX% objective our Korea. extended April, our China to In for over distributor of typically And exclusive also distribution XX% alone key account accounts and in approximately

these long-lasting relationship extend for trials. both to So mutually is beneficial

our last billings, quarter, or in gross on growth by reaching to efforts, components reduced Notably, marketing to XX% the expenses this discussing expect of compared we key in continued our and driving domestic DTC cash about $X strategy are will key operating -- We focus future us first the before, these burn each improved which our by operating A [indiscernible] future we we've our profitability. to initiatives recurring in in controls. collective -- million them million leverage talked turnaround forward, see and demonstrate $X.X for Going XX%, in cost year. utilization continue or strategic calls. expert and initiative is and

of to commitment cash tangible profitable. these becoming of runway the financial and our company our changes As extending losses, and narrowing proof are results the

results to more turn over I'd in detail. much call who our to Now like financial the Chris? review Chris will

Christopher Lesovitz

Dolev. you, Thank

first first million the negatively Global of quarter first quarter Revenue XXXX. XXXX domestic by quarter XXXX of was impacted in $X.X equipment revenue the versus gross total million, for first quarter Our discontinuation revenue the brings, the for versus of revenue $X.X recurring and STRATAPEN. in XXXX. the $X.X deferred million the $X.X was million lower of was of

deferred million first quarter in and in $X.X was XXXX. first the in quarter gross the of X% first million XXXX. domestic Excluding of XXXX adjustments, Equipment $X.X quarter were revenue $X.X other the XXXX, million versus billings of of billings from down XTRAC quarter $X.X the GAAP in recurring first million

be devices same of revenue sales XX, months March million $X.X decreased for the the the periods. XXXX, in of both from compromise X during and million ended period profit majority in the XXXX. to equipment International $X.X Gross VTRAC XTRAC

XX.X% in the lower period profit was profit revenues, primarily gross XXXX, X of of recognition of the ended result decrease the the for XXXX. XX% to gross months As same a percentage compared XX, March was depreciation percent in service, inventory The higher as into QX QX prior in same higher production year period. placed more the and the assets. to due XTRAC devices and deferred costs from obsolete revenue material the in fares TheraClearX new of costs and lasers write-off for

a in XXXX. declined million of the million Total year-over-year. leaner $X $XXX,XXX by XXXX. XXXX. XXXX structure purposeful and The Sales in is of The is late structure to efforts goal operating quarter return were implemented and leaner direct seen result marketing operating year-over-year expenses last the versus expenses quarter a and cost our first $XXX,XXX approximately G&A in declined in first rightsizing a of by cost approximately $X decrease in

and of cash cost along equivalents Our restricted and position XXXX, Financial, at March growth leaner with modified structure. supports MidCap facility credit cash, our with our XX, $X.X cash initiatives million

execute financial we on our goals strategic given for continue position. our can believe to We current XXXX,

had shares XX, March of As XX,XX,XXX XXXX, the common company outstanding.

to like concludes any the I'd remaining Dolev That my comments. call prepared for back and to over remarks, turn

Joseph Pantginis

Chris. STRATA care of treatments patients, the benefit for and systems With dermatology health solutions reimbursed you, market X through clinics course, have dermatology Thank and XTRAC both that we the TheraClearX, and, Skin.

including and starting decline of some that. metrics is recurring narrowing a the reduction revenues root Our quarter, in significant expenses turnaround in strategy the to and first take to point operating in

our operating to them reemphasized the from drive device remove adjusting anticipate . engine successfully footprint routine and domestically domestic underperforming corporate utilization a promising accounts more We basis rightsized our on with and extract device have to overhead, growth and placing accounts. DTC devices

take our complete reach before, We to some turnaround. line expect and be the successful it will to as I But strategy. said time multi-form the finish with

proven and forward for drive. corporate team investors our continued strategies Our progress. their resolute are are support reporting We in to and we and thank our look

call begin to so like the operator the Now can the over we to session. I'd question-and-answer Operator? that turn

Operator

Ladenburg Jeffrey Co. [Operator first our Thalmann here Instructions] with come will & question from And Cohen

Jeffrey Cohen

could of And in the then identify number . regions a of region place, about you'll I a you're So you say, maybe firstly, 'XX. country or talk the that in the end of have sense guess, us by referencing give of DTC?

Dolev Rafaeli

Good question.

the end to the to by quarter. of the middle anticipate We by get regions covering of the all end be we third the -- year. So there by of hope

In these based and cost terms needle lead remain we spend, within spend the the see to moved on up terms of appointment cost need in efficiencies. per of We ranges. DTC per the DTC

patients We see also treatment. of to the we into and And funnel the it grow extra do gradually. converting in as that, we uptake need to patients these

the end So of I deployed. QX middle said, fully QX or be of as to

Jeffrey Cohen

year. regions seeing this all you're And

Dolev Rafaeli

to as we the anticipate treated. X, listeners both And the regions. area, saying has advertising that deck shows we and which in this the I'm -- market the patient which the start the placements regions. all being advertisement of of be in York of presentation the that as refer be X quarter weeks X by that same Yes. investor of be online, outcome converted devices the that appointment, end New in terms leads to to These was the in going as these of the all the patient other patients the are the come an City advertise. have That we then first scheduled areas page we're X in I these in appointments year, later, in to happened needs. leads are well into visual

of covering couple all So to the But a revenue follows of that end we're yes, with regions. be going year, weeks. this by

Jeffrey Cohen

it. Okay. Got

where So world bit XTRAC Give us for? placements end kind you're and you and the and year could in what through a think of with kind perfect of a you TheraClear? QX for of guesstimate the planning same a talk could the of about be in

Dolev Rafaeli

to previous I'll year of we in going to these quarter year, inventory deploying of end position calls, or devices. be I've about or and be just at we're which first of XXX as have an start And have, we all on where this the devices. hand a in to with close detailed like of TheraClear, would next the we by

new And through. the my because deployment So we that flow of of the not as XX now need these a these as deals, prepared patient this go all which over new going the are to are own. And before, utilizing be The mostly is accounts to up mostly with using do. coming I've X,XXX to of rate this outlined is saying them And patients a week, reimbursement. new only remarks, inventory accounts we've we XXX I'm is in accounts. run for presented from of patients XX technology.

the paying accounts based these rest are still the So of accounts, patients. XX cash still based accounts -- on are

anticipate we existing devices. move And replacement any we throughput talking XTRAC, with we with the year, from utilization. -- the about of same if throughout And the the market start TheraClear. in that's utilization account as one cannot do get forward towards the the and So as of devices these the of to

-- and accounts was discussed we So this out press that of release that the the nature there a came go into. week

well device the the they the codes is XTRAC roll-up reimbursement only there, once the and be group out can how money make to clinics of we private We as going our mostly existing can a the way be group with on utilizing utilization is target and accounts devices money. can where because they're utilization we way clear understanding devices put mostly the as only where -- -- going they're utilizing how we equity-owned make to have

, to own accounts, redeploying ended accounts without On took these of revenue continue expand we've balance these using actually more devices fully in quarter productive devices, we market, them that's for TheraClear. having XXXX the number inventory taking $X,XXX build see actually XXXX. from out, you put that utilize device out -- them average we sheet existing So more over down in -- deployed so just or with numbers the devices. as and per can process with the we XXX we're device every with per our XTRAC, we from devices nonproductive the The and to before into XXX XXX will redeploying

Jeffrey Cohen

of utilization [indiscernible] placements does more And as Is how accounts. upside? as XTRAC the or far Talk Okay. the in to Got And far it the as the the new about with as on a then and it. to just or these trends, that coming leads utilization lastly [indiscernible] new looking. importantly, regard bit little funnel funnel trends side? funnel

Dolev Rafaeli

of biggest charge more a Funnel as place have use, with we is we -- most We can charge. the many sorry, technology upside there's placing We of we is and says depreciation, we the over more XXXX. but that the we no assets free which started want, devices assets extending in I'm have device of why higher we outcome ended number XXXX is per repositioning approach easier the that so is because the the the XXXX quarter. replacing, in utilization, And utilization market. placed we these charge. $X,XXX experiencing deeper minimum in before as just that's per devices and extend we with

ended XXXX for we just And with X,XXX. reference,

XX% So the upside recurring the is revenue. about in

the Tier saying from if devices, previously we they've XXX new DTC where in build So from and that the which accounts, both up, an help that we had Tier you X break X, utilizers. and from had business, [indiscernible] there a either or -- The that can up with X into And can focused, Tier has owned this extract to tiers Tier of accounts, move need [indiscernible] as working accounts and them through results XX patients -- the it from on device. if And our wish. we reason we which the release in and do is them these up what a and business. training both week, earlier we to seeing out of and them or device, and whether their X, an the tiers, the out, ferrous in we And were our come owned an that's had cut so with they the can about we've best -- move working the and the well or someone X press bottom, we team letter, these last grow don't X tier was seeking laser move X are quarter, existing see accounts would by this and our if we was laser to outlined them mostly placed or of this by the our franchise, market existing that's we try the we are that or lower have staff to but device as move on accounts big best training Tier them scratch. are them serving is to

We the so and it come reimbursement in what the the training, starting we a business we support, a head to but and on, from account grandfather do us gives we is them and scratch. the in existing technology, new on and need taking support start provide

Operator

turn question-and-answer to any I'd over this [Operator for remarks. now to Rafaeli conference our like closing Instructions] session. And conclude back Dolev the Dr. will

Dolev Rafaeli

for quarterly I XXXX our when want quarter your XXXX. in financial our report likely of progress STRATA conference you July you, and to look results Sciences. on sharing interest and for participating a day. call all We have good our of to in forward thank today's Thank Skin in call next we second

Operator

you for The attending conference concluded. has Thank today's presentation. now

You lines. now may disconnect your

STRATA Skin Sciences (SSKN) 15 May 242024 Q1 Earnings call transcript