BIOL - Earnings call transcript Q1 2021

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Operator

Good day, and welcome to the BIOLASE 2021 First Quarter Financial Results Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Todd Kehrli of the EVC Group. Please go ahead sir.

Todd Kehrli

Thank you, operator. thank results joining ended for XXXX. and discuss today March everyone financial BIOLASE's the afternoon you us for to XX, Good first quarter

the the of Jennifer financials Finance. Beaver, will review over is Officer On to operating to Jennifer and John from in performance then company's Chief it for and President the and quarter more Executive John Vice Bright, the today call first review President detail. BIOLASE turn

the company's XXXX. performance. Such a view today filings Securities during I'd materially to and presentation. the represent contained number could financial BIOLASE's A statements cause quarter today and the regarding begin, Before shortly forward-looking conference to from including will like initiatives Exchange which on historical everyone that risks in replay forward-looking with strategic discussed available These actual May company's forward-looking the this to are call. uncertainties call based of current are release listening Commission. be forward-looking we completion to refer this in of that facts, news as this results. results announcing the earlier to of call, that and remind statements, company's website will expectations statements differ the issued statements this a statements not are These the company's be When company's are please subject first are today's of the risks statements and on only after the XXth, the made XXXX presentation

a the we news it results Relations is so filed today's with a are www.biolase.com. copy have Investor the additional financial be The loss to adjusted include be we've company's details loss I'll BIOLASE of Form SEC. Executive will available over of per the release in reconciliation well non-GAAP and which can the found company's also website as tables the The non-GAAP in net financial loss share, to information, to the you tables President share report With at EBITDA Officer, and net XX-Q do release, per unaudited call the news turn John and the disclosures. now in loss BIOLASE's BIOLASE's Chief encourage section provided said, you that them. not on Beaver. review of John? as for If of GAAP EBITDA adjusted

John Beaver

appreciate and thank We everyone your for this Todd, Thanks, in joining you BIOLASE. us afternoon. interest

I know Bright, this and on an joining Finance. am we is Jennifer of Before of Finance to Jennifer joined President our new that BIOLASE Vice last VP promoted delighted to Accounting me begin, call earlier was month. Director today the as year

pent-up significant continued dentists the of and for we educate our lasers. of from industry-leading success strongest dental to demand on revenue the our Moving our efforts strong particular, and increased the a of which awareness our growth in Waterlase performance reflecting is users in high to ongoing train quarter quarter review benefits on demand the new In technology. fourth experienced quarter, another the typically revenue of our first with year the followed we reflecting quarter

As lasers expanding I’ve our on our awareness focused of six benefits noted specialist formed growth, before, academies to of months, we communities. over dental the dental have further the past specialist accelerate into

adoption most have endodontists, to of recently products. pediatric periodontists and We specialist academies launched further dentists our for drive

ensuring better for procedures, a for safer standard-of-care Our patients. while practitioners a dental dental and improved lasers new, provide environment and

to provide This week, academy Academy dental for last are an into gentler technology traditional young equipment ways and more manner optimal patients clinical and help will pediatric actively experience the practices. new dentists learning, holistic peer-led Waterlase Pediatric in practice dentists. launched their we Waterlase than Pediatric sharing through immersive seeking mentorship, to offers. with clinicians ensure training Dental integration best of Just treat ongoing

additional Our vibration, with They less less little-to-no tooth and believe feel decay remove can an States. sales. for aerosols, care anesthesia. dentists There the our and approximately X,XXX precisely, and Waterlase and Based less laser to more would in in all-tissue drive sales tissue and lasers sales procedures follow-on gently allow calculations, chair, dentists with also releases X% no-shot comfortable cavity blood $XX traditional that lasers on in methods. would are adopting pediatric million any instill result for perform From those scalpel help soft faster an practices toddlers kids in practice our addition healthy In healing United to additional and tongue-tie hopefully, invasive minimally additional infants is pediatric oral dentists of their BIOLASE. excellent consumable pediatric in pediatric to suture turn, preparations, life than internal to for Waterlase we

in needs population. supporting disease. suffering U.S. are academy The featuring gum with experts currently quarter, perio incidence in by to the There the of community. increase with implants from and periodontal to to BIOLASE’s diseases implant an of and online with have in million Academy of mission case devoted are and and periodontists from ways is adult both year the disease directly millions all in in and Periodontists advancing the fosters number disease, During This existing are to approximately being a and seeking learning losses first kind bone increase in the we manage due Periodontists technology. substantial program growth an the clinicians, new launched Launching X,XXX aligns utilizing ongoing Americans of the each placed aging actively the of Waterlase found periodontal mentorship U.S. field. periodontists implants innovative the peri-implant open reviews also Waterlase as meetings of significant XX first this the periodontists Perio peer-led dental seen patients. leading program dental dentistry.

Based in Restorative outcomes the Periodontics these published continue as & in studies including infection Waterlase including BIOLASE studies Journal of We XX% are was Dentistry because in Journal an studies central significant procedures. our already perio perio establish and internal on susceptibility if significantly in and so for This consumable of of to Americans have periodontal revenue. an of the these overall suffering technology. many in U.S. follow-on assisted relates well Endo Last McGuire million generate study, suggest dedicated the as from study protocols that of would $XX BIOLASE, several we International further after Academy, profitability patient target launched laser new additional endodontists, studies’ for Waterlase Also, year, we Periodontology, our lasers, improving the COVID-XX. drive better that determining our believe the fact, additional treatment outcomes were reported not surgery periodontists with exclusive as calculations, confirmed Waterlase will new In of the periodontists course and treatment we findings patient to of which adopted laser community revenue a to an patients. to for disease, adoption for best the and health are believe specifically leading health is these with in significant it markets. they includes for

options. faster various Our Waterlase offers from dental treatment for procedures to new laser benefits endodontists

reduced while Waterlase leadership success unique improved patient-reported technology has in more patient improved a In establishing thought predictability, overall new discomfort endo is Top approach for allows Waterlase’s care. the provided and patient also in quickly addition endodontics. as conservative delivers treatment, outcomes. Waterlase standard-of-care

positive current Waterlase practices. a developed with less Microfluidic with to offer in collaboration solution with the Einstein that for Residency global to in Network's but to lasers Healthcare these with a commercializing lasers. experience. we’re This seeking the debridementX, look residents cleaning of will are improved endodontic and for train advanced relationships upon files, the a techniques. future on endodontists future Waterlase wavelength endodontic providing plans significant enabling across announced experience we endodontics. Healthcare endodontists knowledge products. to quarter, our only industry we Approximately for Irrigation dental BIOLASE's the is in Laser-Assisted translate for our technology immediately to announced also one Residents Network's training residents and XX% and in disinfecting as use implement We proven more these Einstein training already Through EdgePro Endodontics of Einstein Endodontics to dental joining leader and we routinely dental in XXXX of collaboration During with independent technology, hands focus of Residency hospital-based The safer, partner a natural to Dental opportunity practice, be a use disinfection. as were our research grow their in Chromium into offer showing cleaning Recently, built on graduates Erbium, will prepares residents from new EdgeEndo all being significantly endodontic YSGG teach is on approved is not new arming each to reach American offer is we allowing been to first conduct their to with making use alternatives develop endodontists products also standard-of-care they bioceramics, when and practice. endodontic invasive patented device a Residency their and programs their are burs, specialists them higher platform demand more patients the XX-month innovative EdgeEndo, for more that with and believe make endodontists the by device to program the all has a EdgeEndo The Association. program that the

in increase is the $XX only because second sales, safest quarters dental the our These our follow-on positive the in in additional fiscal to treat BIOLASE. opportunity in nearing are paths gives patients benefits to are believe XXXX are inflection highlight dentistry over all revenue the we plus in with are The come. growth every could, by the the three us possible. the and safety put of for calculations, additional $XXX for laser and segments BIOLASE, the nearly us pay percentage specialists associated adoption of equals resumption past We an critical laser penetration X%. the position revenue million U.S. growth in of confidence trajectory. caring continued each to market Together, generate for years consumables. the BIOLASE opportunities believe a technology Perio, revenue small the we from of starting million we tissue U.S. to in for We X% Pediatric these higher approach our in lasers’ have quarter optimal the points growth that seen margin and estimate Our pre-COVID we current the to the adjustments advance in made approximately We dividends. Endo, go experiencing during the way greater the momentum in pandemic laser market market dentals

further proven of to call details their treat regarding We the patients. as infectious that provide portfolio pathogens, believe the dental the turn opportunity with quarter has safer that, growth clinically first With a BIOLASE reduces technologies to product results. our ahead that significant potential seek also risk Jennifer professionals over to I'll

Jennifer Bright

you, management working look I as John are growth and exciting good Finance. These afternoon John, sustained BIOLASE forward times Thank Vice with team new towards and President to the for role everyone. my I and we path profitability. as continue our welcome of

the than as in of results, release our Turning like to which you instead our past financial some focus we rather operational XX-Q, the see the more tables well can I around achieved would are quarter, this context as quarter. the to on improvements highlight financial some read providing of and numbers earnings

XX% momentum in, and believe We challenging growth we revenue this continued delivered and our quarter net first of business navigating performance the representing climate. jumping right gaining in traction year-over-year. are our we success business $X.X demonstrates So million strong

sequentially, this was our each being – typical result the our quarter a of fourth While quarter year. seasonally down with a strongest our typical had seasonality of revenue

We we revenue seeing allowing are is results. pre-COVID which business, to certainly are in momentum pleased with us the approach continued our XXXX our

highlights demand experiencing laser are U.S. abroad positive and Some lasers, other revenue the quarter system industry-leading for U.S. and increasing XX%, to be of revenue consumables increased revenue XX%. include, increased indicators increased dental These offices our year-over-year other increased continue as dental first XXX%, XX%, the international sales in are we open.

couple of sales continuing XX% trend take We a shape have also the users our of share with years. from positive market we new coming expand past over to continue seen

improved from a on international lower distributors. which sales, despite During carry we since gross the larger through quarter, basis margin sell a a percentage margin contribution

year-over-year. and million the margin fact, able year-over-year a prices for the points impact by sold resulted improved the XX%, significantly we gross In the reflecting during to revenue XXX our in in selling quarter. U.S. increase increase basis of $X.X were increase in average products gross profit of a first This

and we focus metric continue We improve this the will coming more to on even margin believe quarters. over improvement

an XX%. On the for operating expenses $X.X of expense line, were million the total quarter, increase

the with to year. Shareholders scheduled Special severance due cost earlier with higher along was SG&A However, expense, one-time Meeting associated we this have

at our totaling to due one history. with cash in taken year, cash execute balance July without December having to equivalents offering end capital sheet BIOLASE’s Our million, significant on is the in the associated the today’s our sheet strong XXXX. the actions of resources increase XX, rights to $XX.X $XX.X remains strategies growth to market. XXXX. several with balance warrants of of it in million for a million access The over past us that we equivalents and equity cash up Due have $XX.X cash quarter We completion the will of exercise believe the with in XXXX and the of offering February strongest years and provide is

and currently June revenues quarter currently revenue strong above exceeded total revenue are BIOLASE are XXX% to continue our summary, ending the second year quarter another solid Moving year-over-year. COVID-XX. by had high strengthen XXXX growth for impacted with XX, most information, to we expansion a second we’ve guidance, significantly our XXX% quarter expect already quarter, and be second and which revenue be $X.X lasers, working. representing XXXX was between and $X.X margin ago on In million, between for we experience of to the actions and quarter for growth million the Based are XXXX we to quarter on that to second demand available forecasting confident and dental the

past commercial changes in We healthier to before is place opportunities year, capitalize on greater made the infrastructure a company. and the With many us. have flexibility the now growth the financial positive over BIOLASE

for to With receive to We in operator possible. are the provide We to allow and that as and that, our are the way turn the treatment I’d growth. our to growth ability look dentists the call confident to plan, for like dental in sustained safest solutions back prospects significant them and Operator? worldwide patients open and our profitability call questions. business revenue achieve long-term believe for

Operator

ahead. [Operator And go from Bauser question Please Instructions] with our first Kyle comes Colliers Securities.

Kyle Bauser

and of should just number color here. adding what there what’s sales sales great. that? afternoon, latest with think the we Hi, of is good for John we about be updates good thanks for and now? Jennifer how territories? to Are organization, would housekeeping, any all for the start we Maybe the Do – anticipating And

John Beaver

think time that may sales How mentioned XX last Yes, we doing? had recall are the you Kyle. You territories. roughly that we I spoke, I

think at time open. one we I the had

revenue We parts in really all have now filled that lot side territory. basically But we the are in – seeing the country good traction of U.S. on the of

the of so, three month go will made territories trying for weren’t open because They And decision fill period considerable really to in those are as had three, open but we actively open we been and we that weren’t have last we out the time. those, well. hire that they a for territories three

is where that – And process. be where that bring once so, we hiring really feel and that XX well will to about that good that about complete will we us –

Kyle Bauser

following conversions equity ever. you and strong recent warrant raise, And as balance the as the mentioned sheet that. Appreciate is the Perfect.

the So, think plenty should here. for guidance reps of would are more a purposes? directional rates here, be To how of runway on guess, we but sort burn Obviously, I helpful. end, any that here we couple modeling bringing about sales

John Beaver

will XXXX as likely had the I full XXXX. we in so, be think rate the year burn for Yes, similar

a in we the cost XXXX, you and so If forth. reduction furloughs recall, around had in lot of

because And burn weren’t so, our that generating revenue. we reduced rate

achieve – come which gets in revenues XXXX, are fourth up EBITDA cash million I into about we’ve mentioned is, for $XX XXXX, our there able then to least as an annualized going of to then, hope before, before, come costs to And talked I’ve up quarter at $XX which into that our are revenue, million the on mid-XXs, of positive As basis us neutral. we certainly flow that and us gets to well. have XXXX, starting

Kyle Bauser

it. Got

And business, McGuire that some particularly you. Have patient are to has Great. results There there. the is that’s no in of new incredible generalists? act Okay. terms able how denying the to it study, new turned tailwind as as business. then, in been of traction the see obviously you Kind to curious in reported Thank winning heads, the outcomes pretty far field win amongst superior.

John Beaver

the a it think is, I open it’s lot characterize Kyle, and way to with doors for the us of periodontal have discussions community. to

asked the – times well team McGuire many our sales Before it. would study, be there are prove said,

traditional good treatment paper. patient clinically is reported as this outcomes, better say, as but and me show You a

relying the lot is. If know, practitioner more a than maybe studies on are used to general you specialists

us study McGuire start started this is, go, let’s conversation, conversations has did those we the and allowed what even the say, it which never you that done before not study. to is because So, have here were

Kyle Bauser

it. here in great. updates the jump I’ll Got all Appreciate queue. back and That’s

John Beaver

Thank you, Kyle.

Operator

you. Thank

with ahead. question Our The next comes from Jackson go Bruce Please Benchmark Company.

Bruce Jackson

you of couple device about A Hi. EdgePro questions are the developing. that

So, the you pathway what economics the how how How going between the you – do then, device EdgeEndo? is before think the to regulatory to long it’s be? forge the going on and market? And be did does is

John Beaver

Well. Hi, describe little But tell bit not Bruce. am more deal to I around the am that. all in-depth. will going economics a I you the I sure

expect able summer. XXX(k) year. of also units In a EdgeEndo clearance the by to pathway, sell submit to to we’ll terms And the the of end over regulatory be for produce expect we the commercial we and that

a do for us head we there XXXX, is think XXXX, so, we into opportunity as revenue bigger opportunity. even that in And obviously some revenue

press OEM in really our BIOLASE. first we as the is, release, this opportunity for So said

it also expecting are we and for of are think, margins they So, at sales now I are as, the flagship to we any marketing our But we that the we if high are today, But versus do around be be iPlus. where that. Waterlase quite not our now, would as going look margins say, responsible accretive.

Bruce Jackson

over Great. shifting the to then, And sales marketing side. Okay. gears and

different providers. of scheduled are the with quarter? And how saw second the Can conversion you idea give us your many for those seeing of model in program? rough success some You that still of had are events events market you with types the you previously a rates

John Beaver

Yes.

batting So, we Waterlase good we standpoint some referring in to in a fourth buy ourselves XXXX. where XXXX program. got up want as end quarter, wanted. large WETP It again that you slipped in the say, wasn’t of XXXX is started to at having start we had part into XXXX late sales XX% quarter exclusive to remember you we and running as parts of of programs get of average you would if trial failed QX COVID in high timeframe. second third I January because We in December, our many Nobody anything. if the that as a off – what think from were country, are the will the I hit wave to in COVID. I back low we And

end dentists be we for they basically the So trials say now happening as close I to the us. or And the eight believe success that now some WETP of of year. happening to above hitting am certainly we the And usually happy past the have balance expect is year four think I – for And dentists year. that lasers. during week the the and we weekend, when from about we that rate in have those to into XX% we’re at XXXX, and that, the had of all very the about you pull every of buying half every of events into out and XX% are rate I our between balance scheduled of have year. first

Bruce Jackson

I’ll terrific. in hop back much. That’s very Thank queue. Alright. you

John Beaver

Thank you, Bruce.

Operator

Vendetti next Instructions] And ahead. question comes with The Anthony you. Maxim Thank go [Operator from Group. Please our

Unidentified Analyst

long-term. breakdown that you of And those John, for percentage was in were Pediatric? Hi sales Perio might be you is each Thanks taking Matt on the release Vendetti. I questions. what from provide describe are and a from opportunities compare saw this general hoping for my for how I your able specialists. Anthony of those to maybe press Endo, sales of on XX%

John Beaver

the Yes. you sales going that. color I breakdown, little you but around bit And and a just are that Matt, that, how XX% exact Dental started Hey endo But dental majority specialists, majority may Academy not that am from of we vast the you? say, pediatric. will quarter. that, further less Pediatric So, from give perio the you of our as this I came recall, of give and from

peri So, fruit my perio opportunity, and and credence some I heal that that are perio have of the I think think belief because for for we it us. the at disease endo us simply have on the When launched the gives – total in the look perio that, the previously implantitis. bearing side, we to opportunity academy opportunity to biggest we ramp sick is the implants, academy

love we think I with have opportunity with So, a opportunity. the significant certainly collaborating is I that that But EdgeEndo. with to especially endodontists

GPs. Kids County. charitable a for for which all dentist, sees day Healthy really These if And this County, think not XX week endodontics give additional going in kids a that us how so of irrigation that’s endodontists And Orange in are many to we’ve subjected and being face in without children not see past in perio doing so and Smiles shocks when is Also big their I XX those to a organization. will had but nine that Waterlase a super procedures from their Orange then organization eyes manner and to well and do because the wouldn’t see to lasers forth, to not who a is opportunity in endodontics, the drill leads they GP only non-invasive is a great going kids wavelength our hosted in the that scope are dentists facility dentistry, we most perform for to go XXXX as treated the couple in but there only week, though that this significant technology, see to our it in well as to this over and last want years. forth sees the of that’s revert they endodontist on pediatric cases. getting

see And there. opportunity huge so, a I

your I all So, know I I about question. didn’t excited three. am answer

Unidentified Analyst

Thank provide the you, the trials during And just specifically? an then, the on if maybe could could those the sales past? DSOs, targeting you you John. update touch quarter? you then, micro Heartland And success on you on some and comment in had DSOs DSOs discussed in then, briefly And product with of the potentially

John Beaver

Right.

So, it’s interesting.

incorporating Some of and asked that, of in they DSOs are fully who us the the and the to, they only not this have quarter the and some of in around process until the technology Canada, but the into incorporating certainly quarter their we trained well. had and second But quarter U.S. you success, to Not now getting practice are into as publicly have that. sell the fourth in practice disclose in probably understand. technology first into can as because names we specifically, the they

the in into now get beginning Canada. DSOs larger we of some are to So,

X.X would are would organization I goes, we’ve probably that Heartland good BIOLASE have They on of as relatively far years with are very we would thank slower than slow. is, this at slow The technology I liked. or we adoption moves an been As – still now them. road It’s news been what type that anybody involved have certainly predicted long think. Heartland talking for a

achieve we would on achieving and we keep us they keep so, to of continue them. characterize – milestones on that in to And I putting front

not would as all it’s have So, I at of moving certainly forward, hoped. just faster in as terms good

Unidentified Analyst

and regarding you expect Okay. eased forward? could do as demand, this Great. further And That’s lockdowns months, just lastly, the little appetite going and several volume country on for seeing vaccination the throughout you comment a very patient are in helpful. trends you progress what equipment capital next are then if the maybe and

John Beaver

Yes.

GXX So, the I’ll lead and guess, segregate U.S. different my I and it’s international, think which, little U.S., In in nations bit us story. rates. comments the I vaccination a between because UK

COVID-XX, When of part, requirements say, most their – terms because nearing thing nearing, there. turn up all some causing pre-COVID think do physician – the operatories of in just of is, am dentist there less country. XX%. of talking XXX%, One of and basically had to disinfection the before. And to bit to patient level the dentists I be parts patients the that I back they a their XX% in yet that’s in needed capacity For have are were I it changeover could because the little dentist not than to constrain

But is coming. to as I that. dentists. do be we things will other seen go see significant trainings don’t have travel think we I in them trade are about that’s having pent-up I as to opposed to and us a far for were XXXX and where where and recently, in to also educational group to dentists We like larger dental they that shows increase get having traveling. wanting a back always big around or as train important out thinking And us forums, think the need or a dentist

that equipment rise. think leads capital to I all on the being

see sales do to two now But now the goes dentists, most like part which very is the to for here and team in months U.S., once to that the and until hard part up are go for the most three ago, city. that’s they Our able again, coming every back. into was

on that’s U.S. over the is than So the Internationally, XX%. that nobody side. And just was else and U.S., other looking countries. a UK chart GXX I had at

was I XX. think number Canada three approaching –

negatively our India, XX%. extended in have below has Even with which lot of about shutdown. all Canada, the some home going news in the obviously Ontario countries recently. affected have read things You orders business their I mean, on a in at we stay

the and fighting up I rest in us given us the the internationally. sales that shifted bit to opening starts environment it of us Frankly, we battle of has and really the for that in more pleased a the the am stream education So, when little international helped training, really take to online revenue of good that that’s believe position stabilize puts advantage online things are we with terms I that world it.

Unidentified Analyst

the hop Excellent. Thank in back I’ll Okay. queue. you.

John Beaver

Thank you, Matt.

Operator

Woo Ed Ascendiant ahead. from Thank you. Capital. question comes And with our Please go next

Ed Woo

you Thank for question. Yes. my taking

you have any or chain supply parts international, your getting of of terms issues components? with Speaking in noticed

John Beaver

Yes, we Ed, have.

unlike every We lead chain probably, not world. issues. supply times So, and having some other around were the manufacturers longer

to-date revenue or that ability had of none Fortunately, impacted to produce.

are the to of in build improve we constantly job time monitoring sure supply And we full that We here will couple in for of are we a time. chain of the making need staying and that’s parts lasers. well But a that are course hopefully. hopefully, delays getting over it us front

Ed Woo

of and these And COVID year, a then, travel hear. be this trade able type lot year? it spending? the you to other my of that case save question you Or anticipate That’s guys reallocation the marketing good Do shows, be to calculations because will were the to last a same on just that, of is expenses. last to all

John Beaver

a say, both. of I’d little it’s bit

in experience with testimonials word a we white BMW shows, as not In not and are having year. think shows, around some So, well larger except half in marketing what we trade year with participate is New the and we’ve And the basis. training. like, of trade in the in through, where lot participating we that’s only a that coming some really glove trial They we of and end that first turn, a anything of not collaboration of are mid-winter referrals, succeeding some that and on I this Chicago and did certainly year of money exclusive flipped We of are just mouth. particularly to last things Greater the but not getting virtual have the York our program. those saved announced shows Waterlase trying, last we their or events money savings are trade other at of dentists and

So, happy that. we are really about

So, they some But a training. as to devoted some experience have it great money be the well. that at saved, making was of sure of will

Ed Woo

Great. my for Well, answering good thanks questions and luck.

John Beaver

Thank you, Ed.

Operator

you. back Thank I we Kehrli for And any to Instructions] no like now remarks. additional turn queue. will [Operator additional to or questions Mr. closing have you in t

Todd Kehrli

and great to a quarter you second for joining today. have you us our report when progress our we Thank call again our in operator. you, continued Thank results This August. forward look We updating day. concludes on

Operator

participation. concludes your today's This for all Thank call. you

now may You disconnect.

Biolase (BIOLQ) 14 May 212021 Q1 Earnings call transcript