LMAT - Earnings call transcript Q2 2021

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Operator

Welcome to the LeMaitre Vascular Q2 2021 Financial Results Conference Call.

As a reminder, today’s call is being recorded. At this time, I would like to turn the call over to Mr. J. J. of Officer Financial Chief LeMaitre Vascular. Pellegrino, ahead, go sir. Please

J.J. Pellegrino

and joining Good me QX our thank George on Roberts. for afternoon, you us LeMaitre; CEO, XXXX and call our on President, are Dave and today's Chairman our conference call. With

our I'll which and the will of within Harbor statement. of XXXX, Reform is Act the risks U.S. the Before make read Today, forward-looking of some subject we to uncertainties. Safe begin, Litigation accuracy statements meaning we Private Securities

to try such will However those anticipate, forward-looking forecast, words we possible, expressions. using by identify as pursue, statements expect, belief, and similar

Our estimates representing the materially forward-looking that refer today, factors or not of those XX-K disclosure regarding forward-looking any most estimates based statements and relied recent filings, and to differ the be are subsequent on on factors Please implied. our and of assumptions should the date. statement to XXXX, our XX, from information our or and results in as SEC including as expressed upon cause views July risk subsequent could cautionary

press is available we website, in this George section www.lemaitre.com. is measures, and the EBITDA over discussed include turn non-GAAP A call non-GAAP this our GAAP outstanding discuss to in LeMaitre. debt. in the call During Investor which non-GAAP reconciliation associated measures is financial the of will release of call, and to contained Relations I'll now

George LeMaitre

on our our record On J.J. #X, sales three today's topics; Thanks, employees; call, impact I'll sales; COVID's #X, force. and #X, QX finally, rebuilding cover

all grew our XX% affected our record over on to We U.K. Thanks to benefited XenoSure open and trial Italy, powering of XXX warehouses allografts. from XenoSure expect to ended turn our has and the speed call intend sales results submit up FDA in rep XXXX the Canadian valvulotomes, we $X.X office sales APAC been pre-COVID We Sales impact XXst, our in XX% same Japan, we'll June XXXX. in returned were of expanding improve our team. $XX.X to APAC. XX to began QX, by infected and Artegraft up in QX, on XX% did be on in order Chinese England, carotid the million requisitions, the safety the the health versus XX markets. October, QX and COVID XenoSure to recovered. our that, our sales facilities. several in July order shipping return employees warehouses Chinese and over high watermark our the $XXX,XXX carotid Americas, from Japanese QX to October. customer in is and QX XXst I'd to of in with largest XX sales with EMEA, XX% X been connections with slow. First, and we're observe since Despite By Meanwhile, sales and vaccines, staff to We J.J. reps. likely or fulfillment. and shunts, X With posted of staff U.S. review patches, to in measures continue have product, pandemic records XXXX. EU availability of and COVID reps. in million like approval we in hospitals By the I'll and to now

J.J. Pellegrino

George. Thanks,

manufacturing XXXX our product driven the product XX.X%, year mix, prior inefficiencies QX over to related personnel by Our reductions, inventory and largely from decrease X.X% in margin The line. XXXX was changes gross of our was period. write-downs, a TRIVEX decrease

down Artegraft. than was and compared XXXX bring in remaining to manufacturing which XXX, rehiring June due Operating acquisition, million million million debt contributed we $XX X/X from XXXX Cash flow week, EBITDA And million proceeds which million respectively. Since $XX million QX QX personnel, XXX with XX $XX.X We of generated in the Artegraft was XXX with QX million coming improving. recent the cash. headcount of of full-time internally XXXX, $XX.X retired sales we ended debt should currently cash XXXX by stock was margin We employees, manufacturing to and operating income of operating have ended and including is with QX restrained are income In more We our of XXX% also XX%. XXXX posted $XX.X reps, $XX quarters. year-over-year. up paid last the levels also from efficiencies $XX our offering. was growth. We pre-COVID of investments. XXXX, up of

revolving to debt million maintain and markets. increased continue profitability capital equity cash We untapped $XX flow to have and line Improved credit. of access our our

to guidance. Turning

For the million represents an represents an increase guidance the increase $XXX.X to of versus of sales XXXX. full our guidance million million operating year the at XX% full of XX%. income $XX.X $XXX.X to And of year $XX.X XXXX, midpoint our of

of XX% it at turn operator I'll Our $X.XX to With represents midpoint. share full-year guidance per XXXX back EPS the increase to of the for an Q&A. that, $X.XX over

Operator

[Operator question we first our Though Instructions] Rick Wise. have from

Rick Wise

Maybe would quarter? the it's trends of what impact up not general, third the and feel seeing mean, slightly help Maybe Just very COVID? to topics. ranges Obviously, for of you. as guidance how have out thank couple there do be given and big seen obviously, dig you surprising but specific continued It I a coming to see second we And the you're out basically fourth trends us us quarter any great about you into are quarter, you've could third strong it's imagine the set makes in quarter, it of just slower, could quarterly think that for the finish. you easier. third seasonally you picture momentum. have like and

George LeMaitre

great question. Rick, George. for the is Thanks this

don't But great going from us the to during strong credit. away truncated and any June going the QX. QX was that products to the XXth, I'm trying not a to it quarter, we're So comment okay, a that's my feel comments, customers gets at quarter on limit into could and get in what's really to already. take if we taking as I want really

felt after felt of to how no, what don't us. the of I around as think or I other vacations answer back take then these guessing device Do if out they've in the waiting, play know in our QX people it's to and like in a take Europe happens. and some questions as be U.S. at this our the The try into would particularly it lot all a we European, And much cautious best and say, in does or it company backlogged think time. you that maybe answer that do QX, questions we unanswered question. they guidance. more to does wait go for and of to see see did Those approach QX. But well QX. want my out continues, to to time, and we're continue, we and I the guidance sort feel out in of and with our got in QX inside a are vacations I But big hey, vacation been we'll companies the look plays little it it's medical and procedures push the bit of exhausted those in we'll our people game, how general, definitely it than procedures U.S.

Rick Wise

about in folks sat Canadian J.J. you If the U.K. you, more back is efficiencies. talking I this staffing talked the close sense my seem maybe about George hiring. you're is for to and facilities, And understood manufacturing manufacturing

back about getting that, we how ever impact lower of think impact on think on-site more that about something the do doing margins, all the do cost margins maybe helps? Just forward? we and potential going manufacturing personnel positive How

J.J. Pellegrino

been get you into start and maybe did from to with feel enduring the extra hire for help there product in well And the get a abate as those we've maybe oddly and QX so QX, Rick, gross or lines well, QX half a now. the the direct inventory we're there's sort that those made, of QX, we of through a working moving you second bit there maybe folks, so more little last of flavor write-downs terms away little year, struggling again think margins or of QX. folks a over and benefit off I as those for from and is it So folks is move in along Seasonally, layoffs coming of of like to we and maybe help lay just forward. forward. that piece typically a aren't labor little those, run I first got obsolete you that And sort other direct better as the bunch are you for bit some COVID the sort inefficiencies then exiting of you excess in doing from a and months little

think those it Artegraft really be, the things. it's piece well other doing strong of combination been a I nice So is has all of gross a margin. may Artegraft And and Rick,

And numbers extent we well. margin continue will to Artegraft see so quarterly to as from strong that the help the that

Rick Wise

it, any Maybe me. It's pipeline greater cash mean, I'll fall. last this just for Dave? ask flow. and the Mr. update, your maybe balance It's stage somebody much the just financial M&A to the more does set take for there, even flexibility, given And could the in any the strength discuss activities, has Roberts sheet, I always strong just hard color

Dave Roberts

to we're of pay obviously, just optically bit mean, the potential that dry equity very with and sellers, have nice off to I for debt, save clean It have more interest, powder. little was offering. a Yes, balance sheet a pleased frankly,

would say, little them up bit of lot little A had open the In little a pipeline We're bit. COVID, bit. a a restrict down. itself, to terms picking it the is starting travel did travel of and I congresses during seeing shut

various pursuing targets. So we are

I a we money well, think was also very And year considering as going lot little EBITDA, ago a lesson Artegraft you over us can the maybe larger we've could from to a be leverage got borrow to tell. object Artegraft for of obviously, targets. that. an is acquisition

focus by or still niche and would a focused cardiac bit little shifted, So larger. at out markets looking and hasn't the targets surgery, like we're but we vascular can Maybe used surgeons. disposables a we our into really on days. these little branching really larger I look endovascular bit are say we implantables

will for shows ready when we if wanted a just the we seller be that prepared when for and we'll and that be that criteria time up all strategic meets of to willing So comes. see

Operator

have from [Operator our question next Matthew Mishan. Instructions] We

Matthew Mishan

XQ wanting give be too the color caution phasing we're second understand look half I not why today? on to and the I XQ where than Just better around guess, in XQ, given here. not would at of XQ and some much here.

George LeMaitre

income? talking And or about you're you talking about sales up

Matthew Mishan

sales. Yes,

George LeMaitre

from... And or to looking Okay, QX sorry. you're from at QX sequentially

Matthew Mishan

in one No QX to little there. a people people understand -- I what really QX. bit of still can or -- Yes, kind in of it seems you share stronger than guidance? we're But have what I QX there do to gray little a won't your bit your QX, out QX like a what area the have -- for put summer. guess like should implied be you

Dave Roberts

I'll here hear question. What pandemic, or we particularly We different in. us, Matt, in growth was a is the then setting cases feel our products such which so J. lines, the the maybe voice. it's saw saw what quarter bit. in QX the records. did U.S. we of start unique for was Dave. widespread to believe well it But and COVID why felt States. for many your come add we a product Good Thanks may among George a through, little J. backlog lessening United

it -- the variant how and QX. down at cautious cold Delta shutting it's really But likes elective it's COVID little think course, a some and then in now just to bit that we're sequence QX we we and hearing to surgeries the think about and we was QX, in know about be Southeast weather, the have I as with in of unprecedented. hospitals

that a they I'll J.J. but certainly up or So, either open to want was if consideration, to George it add.

J.J. Pellegrino

Quick FX topic well. as

here. lose to of the Matt. a There's QX. marking little going from about $XXX,XXX sales QX There's European CE pretty we'll business a So and nuance thing,

that release and have to but we name thrilled CE the that to they They a on there X the there approved were a had one we making we of X marks, years actual X get being proved to those is that wrote weren't before start story, and IFU, all device while the message new. we a approval. So, May product the slightly XenoSure. products different press XXth etcetera, a device from and more a They the out put important have that had continued proved long etcetera, we making

selling anymore we're derogation May most And XXth, markets. and oddly that then as before under we in were May selling ironically, so couldn't And of you XXth. do

expect struggles. for XXth, Europe, And in so post-May some you XenoSure, should

a little so -- And I happen. QX. trying for to being CE we're again, those that then maybe not would QX should thing, don't my point then And I QX coming and X% a pretty business. or see But X be going Normally, we CE so final know summer say links would X% be, in don't And normally, QX big QX, figure So something we we're like those up in say, bit. in really but the a the vacations know and of downdraft to to take we I'd the great issues. folks issues. are what's European all out, marks, usually from FX, fine in back

numbers as our these normal well. have seasonality projected So would

George LeMaitre

might this probably pace get in the and it's on. trying recovery Europe a QX out is I in on add to to something which you to figure kind of more of out limb you're And Yes. want one COVID not

a the that's comps, So opening the felt and you rate maybe as more if end but of to year. a getting more we think into sort folks at growth not prudent tough maybe we like treatments, got crazy in sort last hospitals, like of there, opening a U.S., a still the it's if we QX be going And of away day, approach. X% COVID from feel bit in there's we of an will, going

a feel I So it's nice pretty number. like still

Matthew Mishan

last one question. just then And

for long of the How force hiring take the could Just you to you? up where were do to you sales get think before. that back pace

George LeMaitre

Right. We've Matt, it's months. X question. that's frustrating. This again. is only up a a great reps bit Yes, George in a net been picked sales little X

new call, had accelerating. in I gotten last We in of a I I or sitting okay. it's wider say will have I think while Japanese XX and Europe Artegraft and spoke, would believe this acquisition. XenoSure a X/X be can time should I've American in the in open some gone we at out the there fill of comeback XenoSure Well, in with little X/X requisitions, I Japan. XenoSure more -- Europe. But got stuff bit we last approval because issue little pace now. it's XX start the that QX bit for We've geographically, the right

it the X when got the that's XX meantime know and don't in I like So Europe XX. like a net of in one on getting sort regional start in a it terms In about of I number little does of teeing U.S., faster. also feel sales managers, will of the up one new or We've hiring a think add and machine.

hey, that all take people, it's and see I calls higher ears. bit up, on more about, we're guide complaining phone into are XX little got you sure guess it as it's to the on tough so hard well. pick but running folks open, you've And think you'll people think I to I'm been to when will going So with a And spots far, I'm hire jobs.

Operator

[Operator our Petusky. We Instructions] next Mike have from question

Michael Petusky

questions. sort mean A J.J., a math? cash forma I basically it zero of couple is debt is assuming and pro is balance of something I the sheet $XX essentially mean roughly, that million I'm

J.J. Pellegrino

We banks. out you there's for that then raise of The the directional. that's the balance. think take XX.X then debt the and keep to and or cash on so X% of XX% put take rest, rest was and it I the can

Michael Petusky

are know But on quarters conversations number -- when say on, multiple in targets you of just I several for that years ask, targets to sort So, would this are or mean, of of you're are at deals that or I size whatever the go of of the sort conversations Artegraft you going there want at at, Dave, these you're looking in some whatever. I look I these or conversations with meaningful some of were point? you -- guess terms

Dave Roberts

at Yes. the $XX the Artegraft, Mike, you moment. I the its these $XX.X were we in the a hospital I've in to a It's sales period can were handful dime. LTM prior on range opportunities, I trade would million. $XX.X mean, million got say, turn sales, to up getting million revenue remember, without of discussions acquisition.

opportunities are there are are and there Artegraft opportunities the smaller than larger that that So moment. are at

Michael Petusky

this healthier? terms become folks variant it there distancing, keep full-proof, -- make if you things I guess, mean, George, this PPE, does thing, whatever know if back in of question. just sort of a variant to in And work getting are heats issue nothing's things learned sort and that learn will your there up, you but I you've social all easier I the etcetera. are in that terms employees that think XXXX that's of to

George LeMaitre

things the So we that learned.

think maybe us. may than so more I also there

I might come employees they've but way with be all them, it they're in speak XXX think all themselves I watching own for can't the and COVID to us. of and their I terms think

the we all temperatures out no spreads there all think these oh, COVID I learned, way We're building. in. they've distancing And all in have watches and facilities. on LeMaitre are within We check spread Vascular's our

I spread. think one was there documented

happily variances but from everyone, selling get surprised. didn't needed think so, take learned risks much what maybe There's to really blowback the that we've they've that. We what that. more But to it's work. on of been dinners things to weekends were on we people called a back they're them it's were and We willing like couple I what about and And nice. some

We haven't heard anything about it.

watches thing and their like go, that. for are good XX more think But think XX or everything approach I to learning. X people I better. We're feet thing to doing with this about and than employees for distancing now, to I still and think us the learning handle how So it's we've the what doing same all these months now and rather been we're we're

Michael Petusky

Artegraph Valvulotomes revenue? curious, terms a has top-line pass as in I'm now category of just product

George LeMaitre

that. that some would it hasn't the passed of the say that, it's but brands. category the brands, some $X.X is I whole of past million gotten Valvulotomes, no, of individual

or inside So of of category the is we X brands X the the have category still there. But Valvulotomes company. largest whole that know

Michael Petusky

don't $XX north million? that of been of suspect I has million, $XX north And it's

George LeMaitre

handy? do Hang or what the I'm was, happy number you it. me the on have number have you to that QX -- organic tell get number... David, second. the so let a just QX J.J. I

J.J. Pellegrino

X.X. Valvulotomes

George LeMaitre

And is product the following for that quarter shipping Artegraft along X.X includes just everyone the allocated in for both lines.

Michael Petusky

continued. you believe if be on the I ago, Congratulations wouldn't congratulations. -- I can't a we'd here told had me believe year that,

Operator

are this time There at no questions presenters. more

George LeMaitre

time Thank it's you guess hang very up. operator. much, to I

Operator

Ladies may participation that Have now thank great you your like a conference. I today's and concludes to day. and gentlemen, would for you disconnect.

LeMaitre Vascular (LMAT) 31 Jul 212021 Q2 Earnings call transcript