MYO - Earnings call transcript Q4 2018

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the Myomo, Inc. Fourth Quarter Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Vivian Cervantes of Investor Relations. ma'am. ahead, go Please

Vivian Cervantes

operator. you, Thank

are turning and full the to All I your Myomo's like typically such guidance, SEC historical or to in belief, identify words fourth intent is disclaims estimate, what to issued attention directed. expect, the similar call materially the following expressions may over today, intend, with facts closed statements. Actual expressed or than a results make After to with other these statement. to press we target, conference management, statements. in and remarks forward-looking our outcomes expressly differ The section this release anticipate, these is forward-looking guarantees risks of are please forward-looking Mr. and filing uncertainty future statements. update the from market Investor obligation any earnings project but and would ahead. confidence, implied results. quarter by my now the statements. our this which Paul, go copy turn call it Before are Gudonis, forward-looking and qualifications call to other concerning pleasure These Paul of and time, At is that statements the and certain website. forward-looking used forward-looking this Relations Officer Chairman Myomo. be These risk of limited can to results. press may release business to Executive of the and year other factors subject found A over other Chief contained not to Myomo's financial and statements and involve include affect Myomo's other in not factors performance, may are condition are operating

Paul Gudonis

XX, and you. on David earnings for Vivian, by Henry, XXXX to us December conference and quarter Thank you, in you year I'm call. today of ended welcome joined financial Thank results Financial after remarks. will our your our fourth for joining a and XX, our questions Officer after David be Goldwasser. our in provide retirement discussion of became Ralph of available February Chief prepared who all the

to we and marketing activities. managers investment trained eight significantly scaling country, orthotics top braces team in conducted fit over During MyoPro a in U.S. practices up screaming with increased evaluate our with the in regional And prosthetics the metro XXXX patients our and devices. recruited We patients we our XXX out sales markets days to and national across for built our the sales we

patient paralyzed who our online also many We to individuals need marketing reach to arms. may launch their for braces direct the the efforts powered

pipeline quarter insurance ended from authorization growth To XXX of in are Our reimbursement XX year for our including companies that results XXXX. fourth the growing private in insurance process. pipeline of pipeline calendar insurance strong units new investments the reimbursement year XXX fourth demonstrate adding quarter. achieving perspective, these in units into revenue sold MyoPro units with units all the units record we and put in We process the a the into the a of total of awaiting

partners in year. channel presence clinical We an metro Austin, Francisco, the Antonio, Vegas, O&P having in San multiple XX goal in Louis by the Saint MSA's top Las our O&P also and footprint including fourth distribution quarter markets with the expanded this of adding San Texas

the the an insurance to program During going local with behalf our the record of fourth our we expect percentage other in of the metro quarter, Myomo authorization year to we the local candidates and the the days, new on revenues out we patients. provider they of XXXX. companies for the evaluate price the increase brace fourth areas, fit This necessary. of program that gross as is XX% program contributed provide partner fabricated the we prior direct in directly also then insurance quarter the who and $XX,XXX received This custom this screening We XXXX, direct the the from billing initiated whereby invoiced at to clinicians roll increase support quarter increasing they when program. selling this a margin, our roughly we was will to improvement unit in increase as major compared reason average of be generated approximately per fourth O&P

by from see We continue of growing as well. the to in excellence centers revenue country placed orders our across markets O&P

CMS product codes a November LXXXX policies and XXXX the specified otherwise In coverage been the MyoPro we've and CMS billing of for with product on patients for Medicaid These issued reimbursement. January specific for or these Xst, LXXXX. codes private are insurance to new and centers fees of Medicare that into so using Turning effect services not waiting We're from line, still to their two allowable about LXXXX. who codes instead beneficiaries. Medicare plans miscellaneous code hear went

from yet. decision a have year, them by January heard not back expected We of of I but the end this

product continue emphasize optimistic meantime, worker's I with and the there's a the no compensation, with commercial who that those to cautiously through health and veterans for In codes. for to plans, VA codes policy submit MyoPro we're reimbursement follow care new amount. the system that the need insurance we'll by patients newly will these these for covered ultimate granted determination, suitable on about need While, CMS allow the guarantee

polio prototype AFM, the has We Our MyoPro developments new introduce we plan sized on market acute to this known myelitis. the muscular with to this spinal as moved and test new next the this on children as into like palsy, designs disease version stage flaccid year. atrophy device pediatric cerebral later

revenue financial we'll sales move and With future is year. while efforts providers O&P from includes screening and sales international this at growth. to in stage, patient and the initiative expansion the insignificant our overview of for business, seeds international the Germany Our quarter we're are these expanded to days our of planting marketing how with revenue UK growing host the countries in Denmark, the review on the that working and

to I who past the Myomo's introduce and consultant as full a thank a as last served first David acknowledge us as who month Ralph eight Goldwasser, I Before Henry, CFO years. time new over as joined executive and Myomo's then want CFO.

help he the internal time New additional infrastructure the rounds raise public American, private onto public us enable of capital, capital Exchange growth to go fund to York and Myomo as that raise establish Stock for the financial During our company company. a

will the CFO, So the to of at agree to whom introduce to the next he under age that me help retire, he we the you. to and XX, capital I he I consulting David recent successor youthful two find now and conducted agreement the did as which financing terrific for additional he if growth company. a discuss a support like could the Henry years. results And and quarter for for year the financial raise a

our to Myomo in month, in manufacturing our last results. have extensive As companies, press join you operations. release financial high-tech David Dave, public capital you markets, we're may global experience for seen has and responsibility pleased and have financial present

David Henry

Thank you is to a of welcome. you, join here in at traumatic team this people arm tremendous excited injury driven pleasure gracious This market stepped device the role warm global I great excitement of both Paul. And care and effort. improve of daily I to the large, and was MyoPro. thank that into for strokes your committed be with and paralysis. from Myomo, I'm Myomo relatively and team standard of that for suffering lives opportunity and There the this effects for to of and untapped orthotic see upper extremity the making a part

was the period Now comparable was an XXXX of an XX%, $X,XXX,XXX, let comparable increase me XX% ended of review. XXXX $XXX,XXX, period the turn of the Revenue versus for our year Revenue in XXXX. financial to the of fourth versus XX, increase quarter December XXXX.

through respectively. Gross XX, similar at both XX% sales due was primarily Motion sales margin for average selling for direct XXXX. XXXX, XX, units top the of channel to ended and sales. mix months and three mix our The XX% increased years ended reduce Our Gross December results XXXX, December was XXXX sales Ottobock to quarters favorable product for price number G of The XX% and reflects and ended in sales unit. XX, line and mix. to margin XXXX the channel product year increasing and of was reflects higher reflected the billing XX% December XXXX, respectively. and XXXX shipped the The

are period. increase share expenses the efforts development months the as year Net the for per to XXXX $X,XXX,XXX, personnel, compared XX, XX, increasing period year reflect the for XXXX we December $X,XXX,XXX, of share, an $X,XXX,XXX XXXX. XX, previously, As $X,XXX,XXX, and in December the a costs, of charge for $XX,XXX,XXX, or a to XX%, a year quarter an with $X.XX increase XXXX. for ended during XXXX, $X,XXX,XXX, a XX, Operating $XX,XXX,XXX, XXXX Adjusted $X,XXX,XXX, Net XX, higher administrative quarter our loss were or year loss of the the $X,XXX,XXX $X,XXX,XXX, to with Adjusted share $X,XXX,XXX of primarily December XXXX with comparable as $X,XXX,XXX, December for EBITDA on noted EBITDA our marketing for product sales, for year loss the loss well The and XX or loss or The year compared I notes. expenses of ended operating Operating for compared debt includes per net XX, strategy share of $X.XX increases margins labor our quarter for higher ended versus XXXX loss was was ended a gross associated due implement per compared of loss ended or costs related the increase a the loss the of XX, in XX, $X.XX with average the December was ended support of XXXX. the December company's discount with the ended XXXX. or $XX,XXX,XXX, primarily December XXXX amounted the XXXX. of December corresponding to for of expansion during $X.XX compared the addition the were period ended as XX%, corresponding ago selling expenses in growth convertible efforts. of a ended increased XX, reimbursement per price. December net period loss as

$XX.X net a proceeds forma shares was reminder, year expectations December on of in adjusted is to at EBITDA the February, color full from XXXX our The for release, million XX, XXXX. non-GAAP XXXX to this balance GAAP the XXXX. December operating $X,XXX,XXX, completed X.X of issued on as basis opportunity stock XX, afternoon. this like our including million a net is pro included $XX,XXX,XXX common to a $X.X around As take XX, Cash was cash loss of I'd roughly A of million reconciliation EBITDA at hand provide compared some December adjusted in measure. we XXXX. press to

units our XXX all the quarter This our with XXXX. As year of XX from end XXX the the insurance of reimbursement up in to well units pipeline. with grow increasing of Paul as Due for XXXX. we to compares units at pipeline, previously indicated, expect reimbursement we revenue in ended the is sale third significantly and

is to increase our mentioned. profit just We from less increase increase also XXXX revenues, resulting expected higher expect in that to dollars be I but gross operating expenses in that the anticipated

our result that cash capital requirements expect a XXXX. financing the operations As expenditure and our sufficient of in balances completed fund February, we in existing

to XXXX, raise to we capital breakeven. additional need order to Beyond reach in expect

call the Paul. Now back I'll over turn to

Paul Gudonis

you, Dave. Thank

in today, we're and heard the includes of we implement revenue believe strategy. as metrics you lead future gains attraction which our in signs describe to This we us key as solid revenue. growth performance our While will seeing

recap, our revenues total full million. grew year XX% to to for $X.X So XXXX, the

in sales and goal the upper the a XXXX the We our recent of a we reimbursement, started units XXX paralysis. concludes significant financing XXX% growing growth Excluding worldwide the for as our approximately units sold with address waiting to XXXX, needs in in our we in of our becoming XX U.S., capital business, pipeline. have suitable expand ability presentation. O&P XXXX, in provided formal toward footprint individuals was Medicare in extremity markets of And additional We providers of of revenue Ottobock care in one-time back paralyzed continue more is We additional Europe. to compared our year-over-year. distribution standard growth the and obtaining of revenue of million continue $X.X the the the to coverage. grow part course, This

So operator, call up opening we're questions. now for the

Operator

Company. the question-and-answer our first with from And begin [Operator now Please Sidoti will Instructions] comes your Sidoti We & question Jim ahead session. go with question.

Jim Sidoti

me? you Can afternoon. hear Good

Paul Gudonis

Yes, we Jim. can

Jim Sidoti

Great, great.

Sounds like a of progress. made you've lot

you You in many gave They of us numbers. are go a couple of just right lot over the sort centers now? again. O&P a How

Paul Gudonis

the top our at the demand, of we our O&P for in shifted that marketing that locations programs, the strategy these in markets we're important So is across with country. centers into patient days where the XX What's look across patients we bringing generating are to have direct the most to since ones the the O&P country. Jim, screening

look four location in O&P been providers in has from their has have will example, from So a convenient area. it also have locations. patients will is they metro source at of patients one flow – most the partner, with These the I centers bring that we consider Atlanta, whatever that patient for their particular physicians Atlanta in rehab that markets; referrals their areas. from to I will

that MSAs to drive at more sort So importantly, don't me, number it's distribution this really look our we metro of number footprints. the areas, locations the of as really service of

Jim Sidoti

Okay.

are you in? MSAs many how So

Paul Gudonis

right MSAs. of So smaller XX – we're the of plus XX now MSAs a number in MSAs. XX major top MSAs the are That

Jim Sidoti

you do and could And will could happen any you hear several CMS more have right take that reimbursement back when that quantifying months? is I'm the Okay. regarding that, sense, something that away from or codes

Paul Gudonis

could months. thought several in We take It time. January. It hear could would any at happen we

shutdown As that government have might things. affected period had you know, a the

VA, just meantime. the comp companies, worker's with we're in to going the So continue working private with insurance plans with

Jim Sidoti

in those so imbursement to to the When code quantification, – expect process now. units when much And you that announced, when do have I become pipeline over approvals? the is you get XXX quicker reimbursement guess we those

Paul Gudonis

no covering beneficiaries, is their it this right does there's required. Medicare process faster if for of Medicare with a because much in terms pre-authorization thing patients Well,

As can from billed clinical go a immediately. then those patient, device that documents and clinical and fit the provider purchase they requirements, us long and guidelines meets as patient O&P CMS the establishes meet the the they Medicare that

also would the have effect insurance companies. it private think positive I on a

to may some for job Although, time those approach policies adjust and take Medicare their to them really decision.

Jim Sidoti

of I the more, out channel. Okay. the revenue the XXXX, transition And growth in sales then two of think was

higher said you the think XXXX XXXX, do price expect you I but that XXXX. to we're with be to the relative of units flat in about to units saw increase, where because you revenue

David Henry

I Dave – is think, Henry. this units

use – with units think revenue the I I significant the word increase.

mean, think, factors of that with the year-over-year. a as be are there in So ASP, in were we – that really higher I sell expect growth would units terms ASP And in well I will XXXX. significantly the there of consider the couple the I to

fee provide doing from mix an complete of some large the in providing is that's for covers product is O&Ps the also, – the sales auto other a fairly Ottobock – well. we but line more we for Motion as First the the the and side, as arm, of only ourselves there's through version And top sold ASP our and grasping away move and the hand, on which channels wrist the to had units that not G We're the transaction. then increase. towards from MyoPro, the to that the

Jim Sidoti

but the secondary didn't the me, What get February? And the following in last cash balance I it, one it. was mentioned I for you think, Okay. offering

David Henry

a Yes, million, about it's so pro pro forma, as $XX.X spend. forma

Jim Sidoti

you. Thank

Operator

from next Please our And your comes Henry ahead Scott ROTH go with question with question. Capital.

Scott Henry

Thank good couple afternoon. questions. and of you, A

to confirm First, just works That's confirm that. have I in units math sold out, is just my my models, wanted to I QX. whether what what in I XX correct think

Paul Gudonis

That's correct. Yes.

Scott Henry

in any And was grant there the revenue quarter?

Paul Gudonis

minimis. De

Scott Henry

increases is you growth about expect Okay. guess or first just is, in the is should to question And trying seasonality something's we I should – question at how a think then growth XXXX. this the other big just growing think do when the understand, for we to I'm get, to through to you should blow do Or any rate, trying look or just be the year? on quarter sequential seasonality. it'll color that? we think fourth it tends a throughout But high get trying

Paul Gudonis

Yes, largest some historically, first seen in insurance is in later plans QX. met over revenues history we QX, Scott. have grow have the already to patients, several differ kick the often the in deductible. when Well, they may a so industry. the their for We the quarter, There's year, years, operating through because may O&P our seasonality. in also we have In last deductibles many QX this some from seasonality restarts. in quarter business new see

costs out would zero. So of minimal, their be maybe pocket that MyoPro to for even

of you that some happening. see So

even over shop got where or we screen weather measured So they're and to device. the get see calendar the four be because softer expect, the course O&P you've cast to quarters authorized, the can't it of to year. be patients also increasing get into during able But bit it may a come to QX days if revenue for not to a issues, tends

So what we've typically this sector. seen industry that's in

Scott Henry

Okay. the rate? about it you've What And on that already. you've experience any can of gets reimbursement been and you tracking with you color how pipeline? can a hit That's percent Are helpful. stays And revenue? to about how you us had give know about into long any it pipeline? I your pipeline asked is how think And talk patient converted the

Paul Gudonis

Well, the less the patient increased business XXX two XX% been. to the the it's said where about of adding pipeline sold in kind building screening the or front in it new last the week. of direct we're our qualified years, to stayed with then we're seeing than pipeline, that perspective, We've success and the first O&P greater. reimbursement been we XX end when put we've it's candidates on of of To in every through into terms advertising, XX partners, all, days the rate,

whether the by that, with for So timing. their have it. in to And we're coverage, for payers It's the not we members. pleased plan, of device the paying varies are or appeal that patients still terms

months, months. others within that these others get get basis. beyond six reimbursed between we're of three a on over these time a better And lot we larger get go months, six data as of we'll and a number three Some regular tracking

Scott Henry

tell what of don't you the the QX? I did at reimbursement And us recall, Okay. end pipeline was

Paul Gudonis

Yes. It's stood XXX. at

Scott Henry

Okay.

So…

Paul Gudonis

So I've always there. mass dealt with a

XXX issue turned of come out in hole with. have have went then ones. down for another they disqualified those medical might of example, the they patient those the And XXX in to those into new QX, deal of a some authorizations So case which added number got we pipeline, that or

So that is the overall net now number XXX.

Scott Henry

follow is me somewhat to But it's and gave indicator typed that Okay. say here the you to just you What and the best any guess, That's acceleration? point numbers inflection you challenge when That final would for what subjective. those just I good. is leading an see I've accelerate. and the the question, is for the for start your that would seems and we'll numbers try the the are there reimbursement obviously pipeline to to gauge other metrics And highlight? us that. you indicator Would leading Or determine recommend? that's ramp

Paul Gudonis

Well, They for private are for confident, again, we these our have. is the will are them insurance condition, have that I now a to one make device. get our VA. unless into device believe the in why and And decided pay Because pipeline, the who past is it candidates very device, comp interested That's and candidates worker's evaluation the including we we and of that, visible investors their good best analysts. their physically. payers, are to medical very their the one

is best the to me indicator. that leading So

Scott Henry

you for Thank great. the questions. taking Okay,

Operator

head. Securities. And our go Please Paul from with National next Bienstock question comes

Paul Bienstock

Good quarter, days The have gentlemen. question I you for Thanks. screening planning is quarter XXXX? how Sure. first many the are

Paul Gudonis

Paul. quarter XXX about days XX at to now, running per We're right screening

Paul Bienstock

Okay.

Paul Gudonis

And we in work O&P the up list can come typically activity screening we'll in are XX O&P partner radius. website, In that then maybe calendar. if up, as say, particular one, for wait just I to within Facebook, out, ready a will we we set over up should an attracts mile that go, XXX XX to is slot marketing days screen But the et AdWords, who's as the online coming an to day will if next right that day the patients with to want set in bringing screening days evaluation. city we fact, a don't to we've you And XX, a cetera, want got them evaluated long, patient and their that with be that go Google get soon days. got the our on with website provider

Paul Bienstock

Beautiful, Okay. beautiful.

of currently would do How yours question quickly XX you while. XX? a get to know the second The you're at you I have been that's is I top goal MSA. for think a

Paul Gudonis

Well, the say, Academy at our should that's this the I to other providers. meeting team able probably map. in over we to week, O&P of the Annual six fill O&P three Meeting Orlando, next would is late out months be

Paul Bienstock

Thanks. Okay. Beautiful. more don't have any questions. I

Paul Gudonis

All right. Thank you, Paul.

David Henry

Thank you.

Operator

question Please RF And ahead go with from Roger question. your our Inc. with & next comes Duan Lafferty Co.,

Roger Duan

evening, Thank Paul. you. Good

margin So at of I scaling is margin your case gross XX%. the the new as base direct because scenario sort forward? you're on a it for going of couple you program, see take questions billing MyoPro of side. of your kind Can we

David Henry

Dave Henry, et products, cautious at the play. difference be have with that. factors the company This that they you is would just reimbursements terms is insurance allow. in cetera. Every have there's versus you And a different W, will G of the number of because I

that's we thinking will one something you I that to probably – about match is obviously But probably a you're a on XX% us, gross target that model. think maybe margin to So ahead. be should really probably quarter longer-term longer-term, should in if continue I XX%-ish try and think good is you quarters the putting

Roger Duan

All right.

pediatric how your to the going introduction of with margin version, So, mix? affect your that is

Paul Gudonis

priced Well, we haven't it yet.

That's unit. best expect we earn – sell will same right we that our and we it of now. the adult size type to on think margins do the estimate I MyoPro

Roger Duan

Thank me. for all That's Thanks. right. Paul. you, All

Paul Gudonis

All Roger. you, right. Thank

Operator

back turn over remarks. session. to will our question-and-answer to the for this And any Gudonis Paul conclude I'd closing like conference

Paul Gudonis

year-over-year we've summary, of the you, call. outlined we're through increases in demonstrating like thank all you following thank I they're Well, to And for In today's programs joining growth on and operator. on us with number authorized patients potential of in be waiting revenue record to and translate in could pipeline into our in months ahead. queue increase for which the the revenue revenue growing large a MyoPro, a

and again you this for your good thank a So have evening. afternoon time

Operator

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

may disconnect. now You

Myomo (MYO) 7 Mar 192018 Q4 Earnings call transcript