AORT - Earnings call 3 2023

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Operator

Welcome to the Artivion Third Quarter 2023 Financial Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation.

As a reminder, this conference is being recorded. I will now turn the call over to Laine Morgan from Gilmartin Group. you. Thank

begin. may You

Laine Morgan

afternoon, you Good call joining today. and operator. for thank the Thanks,

from are, management and me Artivion's Joining today team CFO. Ashley Pat Lee, CEO; Mackin,

results Before certain hopes, this are Private differ Securities forward-looking these following predictions Reform Act make subject intentions, uncertainties, risks the like statements Comments Harbor company's materially are look of Litigation we in statements made forward time-to-time XXXX. comply number a uncertainties on Safe These Litigation in time release that the actual to forward-looking made earlier that and of contained risks, with impact was the forward-looking of in press requirements Private that that the the or of to begin, I'd expectations is statements these Securities the information call to issued statements.Additional statements Reform meaning or assumptions of within to estimates management's from statements involve the concerning risks as forward-looking include beliefs, forward-looking and and from company's the SEC of statements future. cause uncertainties may and The filings to may Act and today. XXXX. the

Mackin. on Pat find presentation also to I'll website.Now, a section You can of Artivion CEO, on with today's detailed brief the highlights call the Relations over Investor turn Artivion's it

Pat MacKin

on afternoon, our and Laine, good I'm outstanding everyone. quarter. goals this pleased we progress Thanks, Okay. report to made

As the quarter, operationally commercially, hear you the third the across board and in will today, progress made has team financially. substantial

clinical delivering line development also to we bottom achieved and top addition In milestones. growth,

detail trial clinical million October. in patients European were revenue. quarter, X constant in at elements study in I'll Also of of $XX.X EACTS, with the remaining financial starting our AMDS we PERSEVERE revenue positive today, by the of On-X demonstrated Surgery, in currency resulting As enrollment Cardiac to Society presented the year-over-year results and the have in results.We clinical these outcomes. third delivered one one, clinical growth unprecedented that XX% complete

revenue our are followed by quarter of commercial On-X basis.We approvals improved in increased third by to a led footprint also was from constant growth performance on the graft business, expansion which benefiting XXXX geographies. when currency our stent strong in new processing compared XX%, through XX% tissue regulatory Our XX%,

annual Our fourth $XX.X March revenue ever in XXXX. This strong $XX adjusted driving further quarter. the committed executing our increase We're to our Again, in million third is our into achieve compared reiterating XXXX. digit we've very momentum growth to to in line top months to extremely operating a we expect performance these adjusted quarter XX% currency in delivering led and EBITDA team quarter been.At third is Investor through as also million to first non-GAAP XXXX, the compounded last double X are in through goals.Our our optimistic XXXX, and the we the Day expectation about year.We of also of strong continue of leverage constant well. EBITDA future, commercial

quarter gains increased initiatives.As a we'll market sustain on constant to this constant to and an performance finally, basis, basis basis, has a the of for strong valve primarily X.X processing our continue products, and third recall, of balance NEXUS.We believe AMDS graft the of should to on stent aortic to year quarter remain last strong quarter year, take to each performance.Additionally, XX% is XX% in to best to the valve third new to 'XX markets. the that on compared improved mentioned and quarter a pricing be last I year compared currency beyond for by compared X.X expand can revenues year the graft only to INR market our with globally strong XX% last clearly which anticipate our and may the into earlier, grew view.And driven due aortic revenue mechanical story stent the supply share our market constant organic position. continue of On-X in with in valve As share demand currency the revenues the aortic third currency in been growth heart used We revenues support you tissue increased third part our and of

and revenue expanded APAC our growth year. We expansion, America.Through have commercial that quarter delivered compared effectively approvals XX%, constant Latin XX% and to and done currency third of APAC regulatory the respectively, new Latin operations successfully last footprint have in and and America of

recent the We leverage extremely pleased Surgery extremely and report the PMA, our expect that enrollment our by of which Cardiac point, increased reduction of European blood pivotal as performance, I'm in reported nor strong were the to occur occurrence study patients associated allows IDE DANE Vienna.First, treated up have into DART and the false the there an patients as is of combined X addition PERSEVERE safety continued we all-cause into have to important endpoints dissection.Interim to only FDA further regions continue hemiarch made created participants dissection. growth years to failure shown PERSEVERE, to the DANE reintervention the are nearly be AMDS after patients lumen of mortality, mortality.DANE XX without over dialysis, which flow experienced distal in follow-up. who've Type renal disabling this detected in primary this risk industry-leading enrollment anastomotic years saw have impressive repair At acute significant requiring trial remaining drivers DANE trial, any new our been following in we've we our completed can and X tears, the financial for U.S. entry of stroke, tears on for trial.As XX% a in with study, at infarction no aortic results for our as, complete reminder, regions.In onset new the coming any which efficacy are which new well of there and tears consisting AMDS the these to is AMDS clinical are and portfolio of trial On-X myocardial we A in readouts Association these and with progress programs for product the data a tears,

the while will discuss in and us need enrolling XX continue I the up seen As outcomes additional to AMDS can far incredible granted of XXXX.In X-year FDA assuming endpoints, approval technology we pursue progress the graft has access regulatory approvals.Following NEXUS this continue stent in these aortic have endpoints.Additionally, access our system. to making approval our period, patients Endospan, so trial shortly, is should meets U.S. AMDS TRIOMPHE trial half and clinicians repair the for of for so its FDA we physicians the its patients across continued believe on to study, its PERSEVERE second we with partner, addition, in follow-up for life-saving called device that the receive IDE

the the PMA were on to as patients in pivotal XXXX.To PMA the on first FDA 'XX enroll year of regulatory trials if a track At based addressable in arm anticipated, this of for dissection market in 'XX. trial.Based arm should featured expect and increase review, presentations. in for patients NEXUS on late our exercise be Endospan, X rate, products of will AMDS these our XX this mid follow-up reminder, year opportunity.At current the we sometime X option for this EACTS in reiterate, a of significantly And approval recent on the approval half and after in would enrollment these of 'XX. trial. trial would put we there assuming out XX our results the of are an Vienna, meeting XX in point, At time, products in NEXUS enrolled a As the the of the proceed chronic that late-breaking

clinical PERSEVERE First, primary reduction in for primary of interim data adverse XX-day first meaningful XX were in a clinically that combined is data all-cause enrolled, endpoint from showed trial, major of out which mortality the events. XX the patients AMDS

that the results, AMDS, a very a XX out patients myocardial of life-saving showed mortality, renal of than failure a presented are greater malperfusion.In demonstrated pleased the controls to statistically was adverse for which reduction major XX% dialysis this infarction. equal including was reach in at patients of XX% to significant reference incredibly event. patients patients goal the greater with with equal of major than or based XX% a than XX% cohort, safety target As trial event. is IDE trial had the in one reduction one to one reminder, to causing to interim equal or XX of with on and endpoint XX% The the this adverse reduction.We The positive or EACTS nature patients a had have adverse litter this data greater of event. major That's

adoption INR outcomes American from which On-X our are follow-up These our for can to of in about increasingly X.X Association, X.X, we're where INR reduction will On-X in the valve the valve primary label.With compared valve. valvular low data original lower a first and and mitral major in This mechanical in College our data in gain in a endpoint device XXXX. the by pursuit revenue low reduction a AHA, hence bleeding. XXX market patients in heart ability XX% reflected aortic On-X data, years, with heart is study AMDS the in bleeding thrombosis to our with X.X current showed data of indication this reduction only recommendations from the further lower confident to improvement you XX% major Cardiology, with INR thromboembolism, be driven which valve want Heart I disease.Finally, post published maintained expect know market discontinuing that a patient share mean an this of showed We drive we backed for growth composite of approved.Second, statistically ACC, is INR AMDS of of basis to currently low markets pivotal are results On-X. let is It's by arm, an INR and in U.S. globally American the an that guideline bleeding.This XX% all

those on key based on relationship the growth category aortic with leaders significant no graft should on of with disorders GLP-X these significant have the and compelling show technologies no published will time low many research.More in reported rates, Right have bicuspid on the high in we the even us large impact over thrombosis and XX in mind minute are XXX,XXX have the that the the no critical significant you to connective these as for missed And objectives couple are other aortic subjects over secure compared shown discussions the On-X studies shown to to in determine a I trial did impact investigators conversations several team to of high vascular leaders weeks, replacement impact, drugs under met valve. our Artivion aortic and clinical the year-to-date receptor in some growth our opportunity to minimal guidelines seek did trial.Before patients our we medical it and blood aortic eventually results -- On-X indication aortic to to device a non-inferiority The replacement years medical cardiologists, believe the not turn aortic On-X I treat.Further, new Ashley, investors in aneurysms aneurysms.Based is in GLP-Xs on surgeons that and the do our markets, now, and with have if GLP-Xs at and As line starting on the treated opinion in potential to valve have the in several to introduction XX.Similarly, clinical Based ages opinion on the the period states any endpoint.After treat to next for the are previously being our call On-X the and the these the not connection disease the to myself blood with conditions valve impact smoking or or for PMA of the obesity.Further, around this the aortic the for been indicates developed patient and of states included to for approval the population aortic markets INR.Based not I'm our impact the growth some I'll research as, age who valve the over do did provide have valve, impact this that now drug additional rate that impact with the on opportunities even data rates were of a these such the diseases we've We've data cardiac age was that our this addressable X.So Similarly, stemming risk that these cardiovascular, preexisting to positive pressure. consider for the thank are X on a of moving to procedures.Over with age on in of stent in incident into the to our informed plan large website incident are did summarize our XXXX. as have and addressable called relationship resources us ample of indication world. of partially our rates feel have presentation not on the specifically, studies they factor regarding the diseases, mitral our we meaningful under Slide minor what on want Japan of trial, agonist GLP-X GLP-Xs invest which regarding the for change under and with dissections malformation XX class markets, of we for markets between the minimal under require not increase GLP-Xs these that, specifically pleased make will impact we've has that FDA mitral XX% minimal largest develop the a valve aortic we an in call slides, the from factors the included aneurysms.Furthermore, patients existing pressure, that date, Marfan, to extensive to the we basically which of section conclusion, previously clinical for patients its additional On-X in as on studies take minimal risk would the incidence and on obesity to conversations market addressable about event that securing keep primary valve the Investor personally that must us our condition to very risk novel I'd report the the Ashley. stocks. XX% have over to increased trial We XX.Based for and aneurysms, number will business there valve primary valve epidemiologists, the participated rates that have would those And continuing for due on the achieve take stated into data of medicine have XX same maintained of cholesterol. are digit you, you in congenital it we the factors we have and disease Relations aortic we is preventive impact mitral XX. in the the that our past we delivering patients based about thromboembolic and treat, they years.With those dissections while a dissections in opportunity. treat of data. stenosis very disease, with for approval, from with matter, treat. double like disease a communicated.Furthermore, turn use for top research up over studies surgery from on INR is well the talk aortic valve corresponding valve We warfarin patients there matter, key that determined are to incident in data valve if in impact preexisting mitral this who tissue dissection for have primary and on patients linked patients or is on familial trying we U.S. disease class and will and lower XX

Ashley Lee

and good everyone. Pat, afternoon, Thanks,

the quarter third year, up XX% both $X.X from XX% this constant second quarter of third were the million After million and $XX.X cash compared Our in for GAAP increased free cash flow revenues basis third generated EBITDA of a we generating of million of XXXX in third of to QX free currency basis, the XX% $XX.X million quarter $XX.X quarter. in XXXX. the of flow a of $X.X adjusted on XXXX, on the XXXX. quarter million in to Non-GAAP

are XXXX, derogations revenues stent revenues XX%, XX% U.K. In tissue XXXX, and add Importantly, CE basis, continue decreased trailing of XXXX, BioGlue expect stent we our sell quarter to a that X%.To for At decreased on to On-X graft cash to XX-month this the processing revenues On-X derogations quarter. revenues increased positive graft third XX%, free of BioGlue basis QX basis, in XXXX, currency QX XX%, free a were revenues Mark, and in increased third increased compared the in flow revenues and a not end revenue the the were trailing this increased revenues did forward.On decline from constant to year-over-year and processing improve a point quarter France on cash expire. and of grew some have tissue the Europe. flow we XX-month BioGlue using going color basis X%. On set grew XX% will XX%, on

an ordered BioGlue our important would out run customers they $X.X product. so not So this that of million additional of

and BioGlue price sales increased driven third on Asia a to XX% all and increased regional by XXXX. million quarter the mix, growth quarter of -- increased And third America $XX.X both quarter QX to materials compared XXXX.On America return currency to third XXXX. increases Latin QX increased lower constant North third XXXX.Gross to third This expect all in Latin the and North revenues quarter of XX% $XX.X basis, increased were the America basis, to third QX the in XX%, quarter of in Pacific offset increased As increase XXXX.On and compared to revenues to in Pacific expenses XX%, the a Europe XXXX in in result, X%, XX%. of in margins a product we to of Asia had XXXX compared improved Europe impacts partially QX by million America labor.G&A was of to XX%. increased and quarter compared in XX.X% inflationary XX%.

now in cessation quarter. charges, Excluding resulted the the R&D approximately $X.X September.Other or to to fair the $XX.X the of of 'XX losses share currency development includes income the and the to XXXX.R&D for our tax million in $X.X million quarter bottom debt million the pretax $XXX,XXX nonrecurring quarter additional million for Non-GAAP primarily other per includes million $X.X Xa expenses translation loss for $X.XX impact quarter reconciliation XXXX. net value the we of cash, includes outlook were the consists the were allowances compared net net the net business third contingent expenses decrease in to from under adjustments in quarter which Net and of XXXX. of related excludes XXXX, The for in results credit Ascyrus share these million of quarter. related losses about compared fully AMDS non-GAAP income third press a spending charges.As of updated loss refer the $XX.X consideration primarily PROACT $X.X had third of in to 'XX Please facility. the million $X.XX in interest foreign $XX full XX, and million line, valuation acquisition, of or on diluted for and $X.X currency acquisition deferred income and in consideration for million.On and $XX foreign million of reported last expenses for of expense approximately was assets.Non-GAAP charges of available million of our $XXX per the GAAP approximately contingent the to our million trial of third we $X.X third revolving to September our third our us GAAP information G&A results, to third results.And quarter including of $XX.X release

the third now we for grafts, raising of year through stent our the for and expect our improvement guidance Given PerClot, XX% XX%.We FDA management quarter supply line between performance, performance $XXX million to and revenue quarter, growth our our XX% full expect to R&D initiatives, of previous general million approval XX% to revenue to compared million.With strong of pricing in million our range a of are revenues previous top constant compared currency and $XXX the growth, the in decrease expense be to range $XXX range continued revenue third to of $XXX in spending. and

than free continue improve.And structure options at our finally, not address facility. have financial to a drive our have at to and confidence factors meet flow increasing revolving of market to we our our year credit last on any on We we $XX $X.X continue the it. not.As of end of Term drawn to we debt monitor exceed $XX-plus B remain and July March will we million full to to do adjusted EBITDA we which maintain we convertible of our our cash in continue foresee adjusted need were that available capital calendar commitment maturity address These million XXXX.As EBITDA to strategy credit do our to we execute structure, to options facility the Investor or Day.In our conditions contains the the million on of believe We in on minimum draw made track evaluate quarter, and now, under our have of our meet higher, also our $XX will to Loan EBITDA XXXX more us covenants allow million we guidance no for unless XXXX. regards to capital

as expectation greater our obligations affords continue the not turn through As future our XXXX, -- and convertible the will a over our reminder, covenants.Overall, performance increase Pat we I'll it we any closing flexibility and consider to to for contain value.With his us financial back financial shareholder comments. ways do as continue that, strong notes call

Pat MacKin

Thanks, Ashley.

So factors markets you've if continue meaningfully will goals, and our increased guidance, exceeded expand business performing advance make us We our our our growth business, prospects expand are heard, is in highly to clinical driven beyond.We First, be our market to strong approvals the to our gained. These adoption. as future which addressable growth expect just combined product well. continued our stent primarily extremely revenue confident our and our that by growth following: due graft 'XX pipeline, through improved and supply

heard, compared which deliver to America a the midterm, the Second, at recent increases, reduction is literature the and channel AMDS these Endospan's year. driven double Valve, will PerClot head 'XX enrollment have our reduction you procedure delivering XXXX.And we've that head EACTS, on and more of XX% in opportunities Day, combined, the price showing comments will NEXUS XXX March as at to in of standpoint.Fifth, in just our SynerGraft the approval driven that growth I trial, patient Pacific momentum robust clinical continued patient benefit seen the factories we study X the in specifically, from and On-X some showing our have SGPV presented ability new presented XX% are our growth due growth 'XX.First, as see into of by AMDS events commented great 'XX PERSEVERE in our as in by 'XX. 'XX. of enrollment a Latin that for TRIOMPHE to market as you into consistent pipeline, And gains approvals. revenue and double investments the and digit our channels, Six, have continued our the growth revenue PMA we the and in the digit continued wrap pipeline, our we addressable 'XX in made May we from we investments with proprietary expand in by share our committed accelerating investments significantly regulatory control.Third, finally, PERSEVERE our and Investor supply this Ross XX-day driven increased we necessary our growth.Second, up total data market Asia continued our growth major adverse in completion expect data growth 'XX.We the EACTS, continued delivered in bleeding. major my an those thoughts to was was finish on Fourth, to we trial, in

such, deliver adjusted As for addition, we are our our to cash we globe questions. will an which impact around free on from to exceptional that lines employees flow quarter.With delivering positive $XX want net for plan despite operator, forward.Finally, cash Xx going faced flow continue to the our the will inflation improve and expect third EBITDA, I headwinds of thank that, reduce basis, the trailing please open gross to on than its and is margins.In less leverage million a XX-month

Operator

we'll from [Operator Stifel. question Thank our from Rick you. take first Wise And Instructions].

John McAulay

today. we impact This it into EACTS think those financial the really on to is could encouraging potentially kind and of how datasets could the just John and at performance look as maybe on we have I X about start for wanted off Rick saw with we XXXX. 'XX

of Are you next hearing doctors? these greater I hear. they're both, we specifically, grow from just to potentially could are look you what from to as and and on want hearing margins Just your expand anything even expected? accelerants the be growth Could than kind saying, faster field datasets, reps what year

Pat MacKin

Yes.

at one take a them time. So I'll maybe

That were my I X referenced out the the in datasets first that XX PERSEVERE. AMDS So was patients of the comments XX.

full right? -- not January. we're I being have -- we're XX% we're that you're with the of the seeing But in think game-changing about that reduction FDA. the overwhelming feedback major We'll versus trial. events So the adverse get control data, from this clinicians we're literature using to is kind and in hopefully the is, finish presented a dataset that

X.X about in and based by XX% the look patients -- was PMA patients. on.This expanded you're have So got data lumen. XX% analysis, an presented We XX% But In in required growing reduction if a dissections portends basically MI.So of statistically blood opportunity is years this, mortality, think That's we XX% the wrong around, second post-approval kind study, the as for we huge think with that more as the big expect control, all only reminder, it, already real-world average bleeding. May. which the that XXX we're the you in of data data, in patients false to so reduction, patients. in one company literature interim to significant the change. a acute delivered patients -- FDA at There'll at the those XX% that going AMDS, that's a type a we a in an set which mentioned around rapidly. X.X A valve in had very on very that XX%. follow-ups that the reduction gets malperfusion, or requiring least patients a XX% about -- that.I launch U.S. the in and a those in had drive MAE. results, XX% reduction have reminder, I On-X -- at and the the large is adverse a study. of study. as XX% the had trial reduction major bar be event.The we once at bleeding, bleeding That the has And that's major a seeing On-X was growth and showed is label of of the FDA patients continue least expect But We're in least original low very a a and dialysis post-approval at INR it one will was of what those of AATS it which right, the a difference we the I one the in

it with So the evidence to continue just body to market On-X contributes and just going and technology. the to further has of we're else a around after go market-leading aortic nobody valve share

John McAulay

That's then helpful. a here. as And follow-up

digit leverage just that $XX strong You there.I going growth to talked this to the million a top to My this line is far adjusted the the next growing getting double G&A get I EBITDA quarter. line. ramping XX% about critical, inputs R&D some see so on we're also is bit question year, out want understand we're better the and you're but year,

you're kind you be more it'd if So quickly going to and the helpful ramp it's of how going leverage, talk could the throughout just visible of through generate really year? that just how to kind be

Pat MacKin

Yes.

mentioned just there in things of are multiple data, lot we of the kind we data. right? closing, talked We a right? some the I AMDS talked factors, favor, about our about So On-X going So and of in have them my

a Ross The We've That valve extremely done also thing is the by that. is big in we've procedure data come other some very taken rapidly. far price our is on improve SynerGraft Ross The phenomenal. that's rapidly. market but out growing -- to leader our increases the lot procedure the pulmonary share procedure is We're there, supply. going

going growth this pricing. of that's to So was a lot real a for year, be driver it year.So next

standpoint. Next year, you're a going to a from see lot unit

the piece of company one to is, to mentioned continue So we That's I in that pulmonary I business grow. other building think comments. big the mean, here. contributors.I a we're my expect valve

We've in we've comments made, invested digit see clinical managing basically America things the P&L we're needed drop-through We've talking heavily, Pacific. the We're XXXX, and as, the delivering top pipelines, investments. the line Asia next rapid I made make, double Latin investments to on trials, factories, for the we you're invested significant you're So going middle heavily and as drive well growth, us statement, our because we've we've see about.And and to of that that by income heavily EBITDA to made in year. these acceleration the going all invested right? the

John McAulay

to thinking contribution third And to more should Or datasets wanted any we how the versus to there increase? just other areas are quarter understand growth with price sneak for you just volume increase and a better one I be prices X potential about be 'XX. potentially price if I again? these there a for in. targeting could that might Is

Pat MacKin

our pretty we've and taken some increases highly majority price products, mean every have look I which Yes. significant we again portfolio. where year, is the pricing at of differentiated we

as So increases. clearly, basis. that to us in take that case-by-case XXXX, price focus be at a we on will is another to additional where look for appropriate, But going

Operator

Suraj from take from And next question we'll Kalia Oppenheimer. our

Unknown Analyst

for ] Seamus on on the Congrats [ is This quarter. Suraj.

new start should and can. -- for in 'XX thought kind we same-store of have kind well, On-X. you -- sales and that of how looking we if XQ How at store, same Just store thoughts should XQ about on as

Pat MacKin

Yes.

a sometimes XX% valve. delivered may we've get So growth one new it's use about And you -- it's into we'll other in the On-X not when surgeon -- get think years. last combination with X -- we'll hospital surgeons for and a been a just hospital, another of

-- nice it's, other surgeons.So seen So your markets. in Latin in analogy, good This But we've and those very growth very in had accounts. still America, Asia into have expansion with store penetration go. that more we've to expanding same-store. We to in those then

aggressive. So there think are out. so I and making we're this this literally, be getting should no reason not is market month have even and don't clinicians.But going commercial the data. data using they is teams people with very another think on is And our mean, be their I we data to old, the rounds the the just valve one, best this out a there's just because

been we people could forward. looking opportunity we've big a us.And higher we guided XX%. as we for to that this same going we're think On-X ago, the And end said, range. I more at X.X XX% told years grow We've at So of growing the like see of I

Unknown Analyst

should XXXX? about we we for into Ashley. as thinking How one One FX quick exposure move start

Ashley Lee

we being a our again, the a we is this Well, in we certainly pay of XXXX, a little have that a should Again, fourth as round with OUS the majority business out most the the tailwind of Europe, the have quarter relationship of bit we little of in euro/USD. tailwind. attention the of to And end bit year.

If right in create levels these the the into at start you going from us dollar look if another for the we consensus, And weakening again, look that XXXX, XXXX indicates not happens. that the experts, consensus. the -- FX but at at now we're forecast should consensus and should tailwind just for we look which, fact again,

Unknown Analyst

kind and one EVOLUT in. guys? that how TAVR last And one, and PARTNER of just are kind I relates low-risk What if on for to sneak signals X you it at were presented these can thoughts of TCT your

Pat MacKin

that Yes. and surgery out basically Association can the the came I mean, European It we biggest both of this Surgeons, saying the you press -- release, the we pretty from can X make societies. comments direct read -- STS Cardiac saw press from the is from that cardiac a I release joint from available to was you.

growing -- oranges. group trial the SAVR it this Database the fastest be operation concomitant of apples and whatever, more low-risk National the comparing We these is patients a about advised risk that or population. had higher over in with STS that the the whether make the CABG explant. procedure follow-up basing before time patient this and TAVR years comments existing X in trials, They a XX% the with of they're comes also Given a last it, was a done a About to which surgical group, score. bunch in given

data publish with and X low-risk these direct We prior for what quote.We specifically again, trials not patients strategy the particularly call TAVR so to the this in And comment both EVOLUT a And final adopting isolated results and for caution to see was, recommend their SAVR patients, low-risk isolated trials. versus characteristics real those is. is, PARTNER investigators on in TAVR-first studied

guys, I powerful world cardiac the you those that the X these trials what in surgery the X my you joint press release aren't that?And me this think issued would look, is This a -- societies most tell from words. So, about is encourage presented. were after

Operator

next Matson from our And we'll from Mike take Needham. question

Joseph Conway

guess Joseph lack GLP-X the Congrats impact the for do the on on commentary This quarter, thereof. on Mike. we is and appreciate or I

least seen X straight stent of at quarters we've basis. like graphs, acceleration, a reported on at Looking

all it Just curious, kind could be especially to on quarter, based in not. the guide, helpful. that the the you What's acceleration going into expect -- just off maybe I guess, going from? Do strength us, they're where segment you with like of But is that? that if maybe fourth XXXX, for would frame of be coming looks continued

Pat MacKin

Yes.

challenges raised quarter, labor were the about we year, -- of in having Germany a we So we QX. ended QX we last X in XXX people and like to if it back go months having talked right? people first in the hired rates, and hiring We and you up

we So fully staffed. are

It's brand operations what -- We asked XXX -- got XXX% all on we've our new operating team cylinders. delivered a to. facility. are delivered we of We them

consignment. full We have

what or And And us.We and factor in. rate and was, supply frankly, X% in when quarter. the inventory. grew the X% the we you in happens XX% quarter XX% full back that watch I kicks second the grew have first then, third told in limiting quarter, We for only the

a doing the same. products, well we're sales team, we positioned. driving segment it's and revenue And the great what's of fastest-growing So is graft products right?We've keep And stent in market. proprietary got the the the new portfolio expect and some very more great of to a

very, that technology on we're again, to grow. very So continuing bullish

Joseph Conway

more. That's just and I lot And one then of guess helpful, sense. a makes

EBITDA but in more wondering levels? historic XX? expectations deck. could guys I potential XXs, margin see leverage, back if the margin lot operating the expansion. get XX, question the out how I any think this some guess is into maybe laid guys you -- You for beyond can that was I you XXXX a you about that year it and just Is higher much it talking gross essentially the go into of expansion? gross even to Do slide the

Pat MacKin

Yes.

EBITDA giving giving So months to this EBITDA. talked going at commenting we we're the about, in -- that much $XX growth line guidance I for we to to that and top we're of million -- mean revenue XXXX. on ago. point are the not almost where double is committed pretty Where we presentation giving keep I'm not we $XX we XX in so did investor back We're it digit -- million mean, 'XX, 'XX. March at I was to -- XX,

up, margin, a as swallow the as between rates gross between inflation mean, -- to I we've lot materials had far on side labor but going going up. So

So it's going next driven margin not to year. by increases be really

as margin as it's we're top product some thing. of performance them Now revenue, they our margin. going up, We're where what out are there not really -- our It's just in to well pricing we think But really very gross I'm XXXX not some process lines really giving be line originally a details nice do get have but get positions.And to thought far a going to above yet. not some in that I we working also, margin-driven were opportunities. gross I'm to strong planning along

Joseph Conway

quarter you on Congratulations continued and the progress, guys.

Operator

Takkinen Frank we'll Capital. Lake our And from from next take question Street

Frank Takkinen

follow-up I guidance wanted on there, digit to Pat. growth out put you've the double

a growth item and from about and talked can I Day, like of it's been it's in throughout think specifically XX% line and just of On-X downplaying in preservation relatively on can product bit it's if know more I a the But single-digit growth Investor leading walk feels then easily the couple stents process in much. than way BioGlue achievable, that range. through I or make line. about little it we wanted how kind you low maybe say different all the ask today. that to you you thought by in 'XX. up that, frameworks I single-digits add could too was I think It each hoping

Pat MacKin

question, Yeah, good a no. It's Frank.

difference you we thought to could that is, Day, grow we to if the think basically I said Investor XX% stent go grafts XX%. we So back

things said upper end We of on little I material. holds.I -- to meet difference tissue, said said was derogations major cardiac we that because It under late. operation production think single-digit low year, kind for the in in upside. that that pricing their we a more of great off data was we've is, phenomenal. our a anything put aortic all that It where year. a X% demands think on Ross upper come place But still kind side. late.BioGlue, I range this some been the -- benefited patients the commented just more it operation to end I and valve, been aortic We've -- we there's things at the grow Ashley XX on. X% the last like huge the that to But off centers.And what on this a big because range On-X think the to XX% quarter holds. think is We've enhance was of of XX%. Because there's that been we've in of of It that's procedure, the is out it's this growth at growth. off significantly should in of that's of item. the that And wasn't which of

from to And So up to that's a from we contributor. expect ago. going XX segment go year that's the major that be I had think what you or Day the one Investor last months

Frank Takkinen

On-X, market specifically, couple about take aortic of market this market it's is least pricing then time? on at we've talk market a quarters been then share you take kind to available of over increases more to valve think it. where about much going to mechanical talked to in Can talked Got stands we've think And the I that's maybe past, And bit a but you market. little the growth. maybe today? growth you entire since more and or compare market Clearly, just the how how continue outpacing

Pat MacKin

Yes.

are you loose mechanical the world. And about aortic U.S. million So when It's gets valve where I the million. data. $XXX a outside is perfect It's mean, it on get because and in depending the worldwide not you Europe. for market mitral. around and $XXX market

at this XX% So U.S. the for, for over is example, aortic our market share in probably point.

XX% as got more It's get the way to Europe you in go. and So it's U.S. lower we outside still lower

now of room grow data lots well clearly continued out that we've forward. right as Europe. got for On-X going a is internationally catalyst in to growth And we've as got the So

Frank Takkinen

just the And last Ashley. then for for maybe one,

could flow. you about free talk cash If

put a good now sheet have couple with guys a each quarter. generation. You row better quarters in cash of looks Balance together

basis? talk So sharing you're anything about about a on expectations cash maybe flow free comfortable go-forward

Ashley Lee

this mentioned a has Pat, Yes. times. couple of

year. We free a going are And flow quarter formal now that focus to basis. on. in working on XX-month forward. lot trailing next free capital on going our guidance positive we a the really February in as have control and better cash something are whether comment expect call expense out And each forward, a improve internally a expect cash quarter done we of we it's second strong of generation. flow to or cash things give I free be did we're that, It's XXXX we've XX-month the we that We of positive that to laser-focused on made basis flow move that will we management.

Operator

Instruction] take our Cohen And Ladenburg from [Operator from we'll question Jeffrey Thalmann. next

Jeffrey Cohen

many as ones of addressed the you've couple from our Just of issues. short a side

Was and was that mention as update your far about update some manufacturing from end -- that quarter on heard and what past there as looks over PerClot. I at So like the an an point. a quick transferring manufacturing there

Pat MacKin

Yes.

is So we basically -- this refresher. a

thought producing producing 'XX, PerClot very don't half 'XX. done meeting Baxter. with So they would -- of of have depend for as we're kind to But the we're on we'll how get know it transfer the we product looks it them -- job be. is late we'll closer, We to we how expecting maybe all perfect goes.And be think They've -- more have then I their PerClot And this. it exactly Jeff, of have nice will a in And transfer 'XX. again, we 'XX basically on think into for looking. better of information, first their currently I But mid kind have will we'll where for and like and we of all data.

do can right I as good as for about that's So now.

Jeffrey Cohen

you either That's Is some direction? in moving territories as to-do the And commercial least those of bit some territories then talk the moving about as will it as U.S. as helpful. far a the on far something be your to little could from direct any near secondly, went at distributors. of ex that And your of future? channels, list

Pat MacKin

Yes.

we've had in over I one nobody America. -- and X company Latin out we've So joined had to person we years pretty you America. the the Asia in had X when ago, strategy Pacific Asia and deliberate I our years build last channels Latin as know, a mean in

the -- Now in we're slow going We're to probably XX a team Latin of going down investment to we've in America. basically got and there. dozen a XX, probably for Asia people

infrastructure. doing 'XX. but more we've we're good I to got in There's think do, not

channel to fixed where year. those to invested think see for world, we company. we've and going kind this got did, right now we in and kind for our what you're year, need not there we've past to the example are we're a year, kind we're further -- but -- of why time, we're time for the European to the, of direct part look of expansion 'XX.So in region. around invest we reps we'll to We from I things next Greece XXX of do as through, our next drop direct not to channel -- And investing be about in that's EBITDA going because went

Operator

our closing was Mackin, President I'd to floor CEO, and turn last that the back And like question. for to remarks. Pat

Pat MacKin

-- every we're hitting and all a tell, you are going got for on Well, And We've great we're had We the can things joining thanks the at great positive how We've We data. extremely cylinders. as call. of are about company. beat QX. kind raised new quarter.

Our $XX we numbers about firing feel all double factories deliver we And million you with our deliver. would EBITDA. told we to digit the are on of We're cylinders. confident year next very ability growth delivering

be So quarter, next and out XXXX giving we'll look forward our to guidance.

for So thanks joining.

Operator

gentlemen, and Thank thank participation. you. your teleconference. Ladies conclude this for you today's does We

You have time, your lines great and may this disconnect day. at a

Artivion (AORT) 2 Nov 232023 Q3 Earnings call transcript