Surmodics Reports Third Quarter Fiscal 2021 Results and Updates Fiscal 2021 Revenue and EPS Guidance
Summary of Third Quarter and Recent Highlights
- Revenue of
$23.9 million , a decrease of 11% year-over-year - GAAP EPS of
$(0.24) , non-GAAP EPS of$(0.17) - PMA submission completed for SurVeil™ drug-coated balloon
- FDA 510(k) clearance received for Sublime™ .018 RX PTA Dilatation Catheter
- Successful first patient use of Pounce™ Thrombectomy System for arterial clot removal
- FDA 510(k) clearance received on expanded indication for Pounce™ Thrombectomy System for use in vessels as small as 3.5 mm
- Acquisition of
Vetex Medical Limited expands thrombectomy platform to include venous clot removal
“We made substantial progress in our third quarter to advance our product pipeline, including the final PMA submission for our SurVeil drug-coated balloon. We continue to receive valuable and encouraging physician feedback on their clinical experiences using our Sublime and Pounce products,” said
Third Quarter Fiscal 2021 Financial Results
Total revenue for the third quarter of fiscal 2021 was
Diluted GAAP loss per share in the third quarter of fiscal 2021 was
As of
Updated Fiscal 2021 Guidance
As a result of our operating performance in the first nine months of fiscal 2021, we are raising our full-year revenue guidance for fiscal 2021. We are increasing our fiscal 2021 revenue expectations to a range of
Conference Call Today at
About
Safe Harbor for Forward-looking Statements
This press release, and disclosures related to it, contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical or current facts, including statements regarding the Company’s revenue and earnings expectations for fiscal 2021; expectations regarding design verification, process validation, and manufacturing validation related to the Company’s products; expectations regarding expansion of the potential range of uses of the Company’s products; the potential market position of the Company’s products; the anticipated fiscal 2021 full-year license revenue associated with the Development and Distribution Agreement with
Use of Non-GAAP Financial Information
In addition to reporting financial results in accordance with
ir@surmodics.com
|
|||||||||||||||
Condensed Consolidated Statements of Operations |
|||||||||||||||
(in thousands, except per share data) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|||||||||||||||
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
|
|
|
|
||||||||||
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product sales |
$ |
12,084 |
|
|
$ |
11,987 |
|
|
$ |
33,969 |
|
|
$ |
33,731 |
|
Royalties and license fees |
|
8,796 |
|
|
|
12,398 |
|
|
|
38,182 |
|
|
|
30,767 |
|
Research, development and other |
|
2,993 |
|
|
|
2,498 |
|
|
|
9,014 |
|
|
|
7,823 |
|
Total revenue |
|
23,873 |
|
|
|
26,883 |
|
|
|
81,165 |
|
|
|
72,321 |
|
Operating costs and expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product costs |
|
5,105 |
|
|
|
4,443 |
|
|
|
13,018 |
|
|
|
11,415 |
|
Research and development |
|
12,246 |
|
|
|
13,324 |
|
|
|
36,003 |
|
|
|
37,401 |
|
Selling, general and administrative |
|
7,885 |
|
|
|
7,416 |
|
|
|
22,815 |
|
|
|
21,092 |
|
Acquired intangible asset amortization |
|
560 |
|
|
|
536 |
|
|
|
1,676 |
|
|
|
1,671 |
|
Acquisition transaction, integration and other costs |
|
461 |
|
|
|
— |
|
|
|
461 |
|
|
|
— |
|
Total operating costs and expenses |
|
26,257 |
|
|
|
25,719 |
|
|
|
73,973 |
|
|
|
71,579 |
|
Operating (loss) income |
|
(2,384 |
) |
|
|
1,164 |
|
|
|
7,192 |
|
|
|
742 |
|
Other (expense) income |
|
(127 |
) |
|
|
47 |
|
|
|
(284 |
) |
|
|
(118 |
) |
(Loss) income before income taxes |
|
(2,511 |
) |
|
|
1,211 |
|
|
|
6,908 |
|
|
|
624 |
|
Income tax (provision) benefit |
|
(776 |
) |
|
|
1,248 |
|
|
|
(2,382 |
) |
|
|
3,445 |
|
Net (loss) income |
$ |
(3,287 |
) |
|
$ |
2,459 |
|
|
$ |
4,526 |
|
|
$ |
4,069 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net (loss) income per share |
$ |
(0.24 |
) |
|
$ |
0.18 |
|
|
$ |
0.33 |
|
|
$ |
0.30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net (loss) income per share |
$ |
(0.24 |
) |
|
$ |
0.18 |
|
|
$ |
0.32 |
|
|
$ |
0.30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
13,837 |
|
|
|
13,601 |
|
|
|
13,740 |
|
|
|
13,577 |
|
Diluted |
|
13,837 |
|
|
|
13,786 |
|
|
|
13,959 |
|
|
|
13,775 |
|
|
||||||||
Condensed Consolidated Balance Sheets |
||||||||
(in thousands) |
||||||||
|
||||||||
|
|
|
|
|
|
|
||
|
|
2021 |
|
|
2020 |
|
||
Assets |
|
(Unaudited) |
|
|
(See note) |
|
||
Current Assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
62,177 |
|
|
$ |
30,785 |
|
Available-for-sale securities |
|
|
5,741 |
|
|
|
30,313 |
|
Accounts receivable, net |
|
|
8,601 |
|
|
|
7,675 |
|
Contract assets - royalties and license fees |
|
|
7,043 |
|
|
|
6,108 |
|
Inventories, net |
|
|
6,316 |
|
|
|
5,966 |
|
Prepaids and other |
|
|
4,234 |
|
|
|
5,761 |
|
Total Current Assets |
|
|
94,112 |
|
|
|
86,608 |
|
Property and equipment, net |
|
|
29,112 |
|
|
|
30,103 |
|
Available-for-sale securities |
|
|
4,050 |
|
|
|
— |
|
Deferred tax assets |
|
|
6,368 |
|
|
|
7,315 |
|
Intangible assets, net |
|
|
11,482 |
|
|
|
13,283 |
|
|
|
|
27,379 |
|
|
|
27,185 |
|
Other assets |
|
|
4,696 |
|
|
|
4,269 |
|
Total Assets |
|
$ |
177,199 |
|
|
$ |
168,763 |
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
|
Current Liabilities: |
|
|
|
|
|
|
|
|
Deferred revenue |
|
|
5,151 |
|
|
|
5,200 |
|
Other current liabilities |
|
|
12,511 |
|
|
|
13,692 |
|
Total Current Liabilities |
|
|
17,662 |
|
|
|
18,892 |
|
Deferred revenue |
|
|
11,035 |
|
|
|
10,796 |
|
Other long-term liabilities |
|
|
7,670 |
|
|
|
8,020 |
|
Total Liabilities |
|
|
36,367 |
|
|
|
37,708 |
|
Total Stockholders’ Equity |
|
|
140,832 |
|
|
|
131,055 |
|
Total Liabilities and Stockholders’ Equity |
|
$ |
177,199 |
|
|
$ |
168,763 |
|
|
|
|
|
|
|
|
|
|
Note: Derived from audited financial statements as of the date indicated. |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||
Supplemental Segment Information |
|||||||||||||||||||||||
(in thousands) |
|||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||
|
|||||||||||||||||||||||
|
|
Three Months Ended |
|
|
|
|
|
||||||||||||||||
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|||||||||||||
Revenue: |
|
|
|
|
|
% of Total |
|
|
|
|
|
|
% of Total |
|
|
% Change |
|
||||||
Medical Device |
|
$ |
16,755 |
|
|
70.2 |
% |
|
|
$ |
20,514 |
|
|
76.3 |
% |
|
|
(18.3 |
)% |
|
|||
In |
|
|
7,118 |
|
|
29.8 |
% |
|
|
|
6,369 |
|
|
23.7 |
% |
|
|
11.8 |
% |
|
|||
Total revenue |
|
$ |
23,873 |
|
|
|
|
|
|
$ |
26,883 |
|
|
|
|
|
|
(11.2 |
)% |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Nine Months Ended |
|
|
|
|
|
||||||||||||||||
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|||||||||||||
Revenue: |
|
|
|
|
|
% of Total |
|
|
|
|
|
|
% of Total |
|
|
% Change |
|
||||||
Medical Device |
|
$ |
60,858 |
|
|
75.0 |
% |
|
|
$ |
54,222 |
|
|
75.0 |
% |
|
|
12.2 |
% |
|
|||
In |
|
|
20,307 |
|
|
25.0 |
% |
|
|
|
18,099 |
|
|
25.0 |
% |
|
|
12.2 |
% |
|
|||
Total revenue |
|
$ |
81,165 |
|
|
|
|
|
|
$ |
72,321 |
|
|
|
|
|
|
12.2 |
% |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|||||||
Operating (loss) income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Medical Device |
|
$ |
(2,491 |
) |
|
$ |
532 |
|
|
$ |
5,480 |
|
|
$ |
(1,344 |
) |
|
|
|
|
|||
In |
|
|
3,378 |
|
|
|
3,254 |
|
|
|
10,407 |
|
|
|
9,315 |
|
|
|
|
|
|||
Total segment operating income |
|
|
887 |
|
|
|
3,786 |
|
|
|
15,887 |
|
|
|
7,971 |
|
|
|
|
|
|||
Corporate |
|
|
(3,271 |
) |
|
|
(2,622 |
) |
|
|
(8,695 |
) |
|
|
(7,229 |
) |
|
|
|
|
|||
Total operating (loss) income |
|
$ |
(2,384 |
) |
|
$ |
1,164 |
|
|
$ |
7,192 |
|
|
$ |
742 |
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Reconciliation of GAAP Measures to Non-GAAP Amounts |
|||||||||||||||
Schedule of EBITDA, Adjusted EBITDA and Cash Flows from Operations |
|||||||||||||||
(in thousands) |
|||||||||||||||
(Unaudited) |
|||||||||||||||
|
|||||||||||||||
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
|
|
|
|
||||||||||
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
EBITDA and Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income |
$ |
(3,287 |
) |
|
$ |
2,459 |
|
|
$ |
4,526 |
|
|
$ |
4,069 |
|
Income tax provision (benefit) |
|
776 |
|
|
|
(1,248 |
) |
|
|
2,382 |
|
|
|
(3,445 |
) |
Depreciation and amortization |
|
1,844 |
|
|
|
1,790 |
|
|
|
5,610 |
|
|
|
5,390 |
|
Investment income, net |
|
(26 |
) |
|
|
(124 |
) |
|
|
(95 |
) |
|
|
(584 |
) |
Interest expense |
|
59 |
|
|
|
29 |
|
|
|
178 |
|
|
|
99 |
|
EBITDA |
|
(634 |
) |
|
|
2,906 |
|
|
|
12,601 |
|
|
|
5,529 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition transaction, integration and other costs (1) |
|
461 |
|
|
|
— |
|
|
|
461 |
|
|
|
— |
|
Loss on strategic investment (2) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
479 |
|
Adjusted EBITDA |
$ |
(173 |
) |
|
$ |
2,906 |
|
|
$ |
13,062 |
|
|
$ |
6,008 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities |
$ |
2,755 |
|
|
$ |
11,439 |
|
|
$ |
14,500 |
|
|
$ |
12,696 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Guidance Reconciliation: Estimated Non-GAAP Diluted Earnings Per Share |
|||||||
For the Fiscal Year Ending |
|||||||
(Unaudited) |
|||||||
|
|||||||
|
Fiscal 2021 Full-Year Estimate |
|
|||||
|
Low |
|
|
High |
|
||
GAAP diluted EPS |
$ |
(0.10 |
) |
|
$ |
0.05 |
|
Amortization of acquired intangibles per diluted share (3) |
|
0.19 |
|
|
|
0.19 |
|
Acquisition transaction, integration and other costs per diluted share (1) |
|
0.07 |
|
|
|
0.07 |
|
Non-GAAP diluted EPS |
$ |
0.16 |
|
|
$ |
0.31 |
|
|
|||||||||||||||||||||||||||||
Net (Loss) Income and Diluted EPS GAAP to Non-GAAP Reconciliation |
|||||||||||||||||||||||||||||
(in thousands, except per share data) |
|||||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||
|
|
For the Three Months Ended |
|
|
|||||||||||||||||||||||||
|
|
Total Revenue |
|
|
Operating Loss |
|
|
Operating Loss Percentage |
|
|
Loss Before Income Taxes |
|
|
Net Loss (5) |
|
|
Diluted EPS (6) |
|
|
Effective tax rate |
|
|
|||||||
GAAP |
|
$ |
23,873 |
|
|
$ |
(2,384 |
) |
|
|
(10.0 |
)% |
|
$ |
(2,511 |
) |
|
$ |
(3,287 |
) |
|
$ |
(0.24 |
) |
|
|
(30.9 |
)% |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets (3) |
|
|
— |
|
|
|
560 |
|
|
|
2.4 |
% |
|
|
560 |
|
|
|
530 |
|
|
|
0.04 |
|
|
|
|
|
|
Acquisition transaction, integration and other costs (1) |
|
|
— |
|
|
|
461 |
|
|
|
1.9 |
% |
|
|
461 |
|
|
|
461 |
|
|
|
0.03 |
|
|
|
|
|
|
Non-GAAP |
|
$ |
23,873 |
|
|
$ |
(1,363 |
) |
|
|
(5.7 |
)% |
|
$ |
(1,490 |
) |
|
$ |
(2,296 |
) |
|
$ |
(0.17 |
) |
|
|
(54.1 |
)% |
|
|
|
For the Three Months Ended |
|
|
|||||||||||||||||||||||||
|
|
Total Revenue |
|
|
Operating Income |
|
|
Operating Income Percentage |
|
|
Income Before Income Taxes |
|
|
Net Income (5) |
|
|
Diluted EPS |
|
|
Effective tax rate |
|
|
|||||||
GAAP |
|
$ |
26,883 |
|
|
$ |
1,164 |
|
|
|
4.3 |
% |
|
$ |
1,211 |
|
|
$ |
2,459 |
|
|
$ |
0.18 |
|
|
|
(103.1 |
)% |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets (3) |
|
|
— |
|
|
|
536 |
|
|
|
2.0 |
% |
|
|
536 |
|
|
|
503 |
|
|
|
0.03 |
|
|
|
|
|
|
Non-GAAP |
|
$ |
26,883 |
|
|
$ |
1,700 |
|
|
|
6.3 |
% |
|
$ |
1,747 |
|
|
$ |
2,962 |
|
|
$ |
0.21 |
|
|
|
(69.5 |
)% |
|
|
|||||||||||||||||||||||||||||
Net Income and Diluted EPS GAAP to Non-GAAP Reconciliation |
|||||||||||||||||||||||||||||
(in thousands, except per share data) |
|||||||||||||||||||||||||||||
(Unaudited) |
|||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||
|
|
For the Nine Months Ended |
|
|
|||||||||||||||||||||||||
|
|
Total Revenue |
|
|
Operating Income |
|
|
Operating Income Percentage |
|
|
Income Before Income Taxes |
|
|
Net Income (5) |
|
|
Diluted EPS |
|
|
Effective tax rate |
|
|
|||||||
GAAP |
|
$ |
81,165 |
|
|
$ |
7,192 |
|
|
|
8.9 |
% |
|
$ |
6,908 |
|
|
$ |
4,526 |
|
|
$ |
0.32 |
|
|
|
34.5 |
% |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets (3) |
|
|
— |
|
|
|
1,676 |
|
|
|
2.1 |
% |
|
|
1,676 |
|
|
|
1,586 |
|
|
|
0.12 |
|
|
|
|
|
|
Acquisition transaction, integration and other costs (1) |
|
|
— |
|
|
|
461 |
|
|
|
0.5 |
% |
|
|
461 |
|
|
|
461 |
|
|
|
0.03 |
|
|
|
|
|
|
Non-GAAP |
|
$ |
81,165 |
|
|
$ |
9,329 |
|
|
|
11.5 |
% |
|
$ |
9,045 |
|
|
$ |
6,573 |
|
|
$ |
0.47 |
|
|
|
27.3 |
% |
|
|
|
For the Nine Months Ended |
|
|
|||||||||||||||||||||||||
|
|
Total Revenue |
|
|
Operating Income |
|
|
Operating Income Percentage |
|
|
Income Before Income Taxes |
|
|
Net Income (5) |
|
|
Diluted EPS |
|
|
Effective tax rate |
|
|
|||||||
GAAP |
|
$ |
72,321 |
|
|
$ |
742 |
|
|
|
1.0 |
% |
|
$ |
624 |
|
|
$ |
4,069 |
|
|
$ |
0.30 |
|
|
|
(552.1 |
)% |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets (3) |
|
|
— |
|
|
|
1,671 |
|
|
|
2.3 |
% |
|
|
1,671 |
|
|
|
1,559 |
|
|
|
0.11 |
|
|
|
|
|
|
Loss on strategic investment (2) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
479 |
|
|
|
378 |
|
|
|
0.03 |
|
|
|
|
|
|
Tax impact of CARES Act (4) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(1,768 |
) |
|
|
(0.13 |
) |
|
|
|
|
|
Non-GAAP |
|
$ |
72,321 |
|
|
$ |
2,413 |
|
|
|
3.3 |
% |
|
$ |
2,774 |
|
|
$ |
4,238 |
|
|
$ |
0.31 |
|
|
|
(52.8 |
)% |
|
(1) |
Represents expenses specifically associated with the business acquisition of |
(2) |
In fiscal 2020, represents the loss recognized on the impairment of a strategic investment for which an effective rate of 21% was used to estimate the income tax impact. |
(3) |
Amortization of business acquisition-related intangible assets and associated tax impact. A significant portion of the business acquisition-related amortization is not tax deductible. |
(4) |
Represents the income tax benefit recognized from the carryback of net operating losses under the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) enacted in |
(5) |
Net (loss) income includes the effect of the above adjustments on the income tax provision (benefit), taking into account deferred taxes and non-deductible items. In both fiscal 2021 and fiscal 2020, an effective rate of 21% was used to estimate the income tax impact of the adjustments, except that expenses occurring in |
(6) |
Potentially dilutive common shares resulting from dilutive common stock options and non-vested stock relating to restricted stock awards and restricted stock units have been excluded from the calculation of GAAP net loss per share as their effect was antidilutive for three months ended |
View source version on businesswire.com: https://www.businesswire.com/news/home/20210804005173/en/
ir@surmodics.com
Source: