Cardiovascular Systems, Inc. Reports Fiscal 2023 First Quarter Financial Results
Cardiovascular Systems, Inc. (CSII) reported first-quarter revenues of $59.7 million, a 2.2% increase year-over-year. Worldwide coronary revenue rose 7.9%, but peripheral revenue fell by less than 1%. Net loss for the quarter was $10.6 million, or $0.27 per share, compared to a loss of $8.6 million last year. The company reiterates its fiscal 2023 revenue guidance of $255 million to $265 million, suggesting growth of 8% to 12%. Adjusted EBITDA loss widened to $5.2 million. CSI remains optimistic about market recovery and product expansion.
- Fiscal Q1 revenue increased by 2.2% year-over-year.
- Worldwide coronary revenue grew by 7.9%.
- Net loss of $10.6 million, wider than $8.6 million loss last year.
- Adjusted EBITDA loss increased to $5.2 million from $1.2 million.
Conference Call Scheduled for Today,
-
Revenues of
increased$59.7 million 2.2% compared to first quarter last year -
Management reiterates fiscal 23 revenue guidance of
to$255 million , representing$265 million 8% to12% growth
Executive Commentary –
“We are pleased with the state of our business and our performance in the first quarter. Q1 revenue of
“Fiscal Q1 is typically our lowest revenue quarter of the year due to lower procedure volumes in the July and August timeframe. This seasonality typically results in Q1 revenue that is approximately 5 to 6 percent lower than Q4.
“Compared to Q4, Q1 revenue declined
“In total, we executed our commercial and R&D plans throughout the quarter and remain on track to deliver strong revenue growth and achieve key product development milestones in fiscal 23.”
First Quarter Financial Highlights
CSI’s fiscal 2023 first quarter revenues were
Selling, general and administrative expenses were
First-quarter net loss of
As of
Fiscal Year 2023 Guidance
Ward added, “Q1 results were consistent with our expectations. As a result, we are reiterating our fiscal 23 financial guidance. This guidance assumes continued improvement in US hospital procedure volumes and no new COVID headwinds over the course of the year. We believe the market recovery combined with improving commercial execution, competitive momentum, new product introductions and international expansion will drive our annual revenue to a range of
For the fiscal year ending
-
Revenue of
to$255 million ;$265 million -
Gross profit as a percentage of approximately
72% to74% of revenues; -
Research and development expenses of approximately
16% to17% of revenues; -
Net loss in a range of
9% to11% of revenues; and - Adjusted EBITDA near break-even.
Webcast Scheduled for Today at
CSI will host a live conference call and webcast of its fiscal first quarter results today,
About Coronary Artery Disease (CAD)
CAD is a life-threatening condition and a leading cause of death in men and women globally. CAD occurs when a fatty material called plaque builds up on the walls of arteries that supply blood to the heart. The plaque buildup causes the arteries to harden and narrow (atherosclerosis), reducing blood flow. The risk of CAD increases if a person has one or more of the following: high blood pressure, abnormal cholesterol levels, diabetes, or family history of early heart disease. According to the
About Peripheral Artery Disease (PAD)
Eighteen to 20 million Americans, most over age 65, suffer from PAD, which is caused by the accumulation of plaque in peripheral arteries reducing blood flow. Symptoms include leg pain when walking or at rest. Left untreated, PAD can lead to severe pain, immobility, non-healing wounds and eventually limb amputation. With risk factors such as diabetes and obesity on the rise, the prevalence of PAD is growing at double-digit rates.
About
Safe Harbor
Certain statements in this news release are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are provided under the protection of the safe harbor for forward-looking statements provided by that Act. For example, statements in this press release regarding (i) CSI’s strategy, goals and prospects; (ii) our expectation that we are on track to deliver strong revenue growth and achieve key product development milestones in fiscal 23; (iii) our expectations regarding improvement in
Product Disclosures:
Peripheral Products
Indications: The Stealth 360® PAD System and Diamondback 360® PAD System are percutaneous orbital atherectomy systems (OAS) indicated for use as therapy in patients with occlusive atherosclerotic disease in peripheral arteries and stenotic material from artificial arteriovenous dialysis fistulae.
Contraindications: The
Warnings/Precautions: Although the incidence of adverse events is rare, potential events that can occur with atherectomy include: pain, hypotension, CVA/TIA, death, dissection, perforation, distal embolization, thrombus formation, hematuria, abrupt or acute vessel closure, or arterial spasm.
See the instructions for use for detailed information regarding the procedure, indications, contraindications, warnings, precautions, and potential adverse events. For further information call CSI at 1-877-274-0901 and/or consult CSI’s website at www.csi360.com.
Caution: Federal law (
The Stealth 360® PAD System and Diamondback 360® PAD System received FDA 510(k) clearance. The Stealth 360® PAD System is CE Marked.
Coronary Product
Indications: The Diamondback 360® Coronary Orbital Atherectomy System (OAS) is a percutaneous orbital atherectomy system indicated to facilitate stent delivery in patients with coronary artery disease (CAD) who are acceptable candidates for PTCA or stenting due to de novo, severely calcified coronary artery lesions.
Contraindications: The
Warnings/Precautions: Performing treatment in excessively tortuous vessels or bifurcations may result in vessel damage; The
See the instructions for use for detailed information regarding the procedure, indications, contraindications, warnings, precautions, and potential adverse events. For further information call CSI at 1-877-274-0901 and/or consult CSI’s website at www.csi360.com.
Caution: Federal law (
The Diamondback 360® Coronary
Consolidated Statements of Operations (Dollars in Thousands) (unaudited) |
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Three Months Ended |
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2022 |
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|
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2021 |
|
|
|
|
|
|
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Net revenues |
|
$ |
59,673 |
|
|
$ |
58,370 |
|
Cost of goods sold |
|
|
16,698 |
|
|
|
14,308 |
|
Gross profit |
|
|
42,975 |
|
|
|
44,062 |
|
Expenses: |
|
|
|
|
||||
Selling, general and administrative |
|
|
44,475 |
|
|
|
41,851 |
|
Research and development |
|
|
9,056 |
|
|
|
10,022 |
|
Amortization of intangible assets |
|
|
346 |
|
|
|
304 |
|
Total expenses |
|
|
53,877 |
|
|
|
52,177 |
|
Loss from operations |
|
|
(10,902 |
) |
|
|
(8,115 |
) |
Other (income) expense, net |
|
|
(252 |
) |
|
|
367 |
|
Loss before income taxes |
|
|
(10,650 |
) |
|
|
(8,482 |
) |
(Benefit) provision for income taxes |
|
|
(19 |
) |
|
|
136 |
|
Net loss |
|
$ |
(10,631 |
) |
|
$ |
(8,618 |
) |
|
|
|
|
|
||||
Basic and diluted earnings per share |
|
$ |
(0.27 |
) |
|
$ |
(0.22 |
) |
|
|
|
|
|
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Basic and diluted weighted average shares outstanding |
|
|
39,607,022 |
|
|
|
39,087,472 |
|
Consolidated Balance Sheets (Dollars in Thousands) (unaudited) |
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2022 |
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|
2022 |
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ASSETS |
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Current assets |
|
|
|
|||||
Cash and cash equivalents |
$ |
62,850 |
|
$ |
66,424 |
|||
Marketable securities |
|
80,898 |
|
|
|
93,409 |
|
|
Accounts receivable, net |
|
40,259 |
|
|
|
39,678 |
|
|
Inventories |
|
37,944 |
|
|
|
34,567 |
|
|
Prepaid expenses and other current assets |
|
9,125 |
|
|
|
7,768 |
|
|
Total current assets |
|
231,076 |
|
|
|
241,846 |
|
|
Property and equipment, net |
|
28,959 |
|
|
|
29,035 |
|
|
Intangible assets, net |
|
15,388 |
|
|
|
15,734 |
|
|
Strategic investments |
|
34,027 |
|
|
|
33,425 |
|
|
Other assets |
|
2,588 |
|
|
|
2,637 |
|
|
Total assets |
$ |
312,038 |
|
|
$ |
322,677 |
|
|
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|
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|
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LIABILITIES AND STOCKHOLDERS’ EQUITY |
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Current liabilities |
|
|
|
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Accounts payable |
$ |
16,757 |
|
|
$ |
14,383 |
|
|
Accrued expenses |
|
19,704 |
|
|
|
23,464 |
|
|
Deferred revenue |
|
694 |
|
|
|
2,107 |
|
|
Total current liabilities |
|
37,155 |
|
|
|
39,954 |
|
|
Long-term liabilities |
|
|
|
|||||
Financing obligation |
|
20,208 |
|
|
|
20,298 |
|
|
Other liabilities |
|
12,522 |
|
|
|
12,945 |
|
|
Total liabilities |
|
69,885 |
|
|
|
73,197 |
|
|
Commitments and contingencies |
|
— |
|
|
|
— |
|
|
Total stockholders’ equity |
|
242,153 |
|
|
|
249,480 |
|
|
Total liabilities and stockholders’ equity |
$ |
312,038 |
|
|
$ |
322,677 |
|
Non-GAAP Financial Measures
To supplement CSI's consolidated condensed financial statements prepared in accordance with GAAP, CSI uses a non-GAAP financial measure referred to as "Adjusted EBITDA" in this release.
Reconciliations of these non-GAAP measures to the most comparable
Adjusted EBITDA (Dollars in Thousands) (unaudited) |
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Three Months Ended |
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2022 |
|
|
|
2021 |
|
|
|
|
|
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Net loss |
$ |
(10,631 |
) |
|
$ |
(8,618 |
) |
|
Less: Other (income) and expense, net |
|
(252 |
) |
|
|
367 |
|
|
Less: (Benefit) provision for income taxes |
|
(19 |
) |
|
|
136 |
|
|
Loss from operations |
|
(10,902 |
) |
|
|
(8,115 |
) |
|
Add: Stock-based compensation |
|
4,438 |
|
|
|
5,672 |
|
|
Add: Depreciation and amortization |
|
1,220 |
|
|
|
1,258 |
|
|
Adjusted EBITDA |
$ |
(5,244 |
) |
|
$ |
(1,185 |
) |
Use and Economic Substance of Non-GAAP Financial Measures Used by CSI and Usefulness of Such Non-GAAP Financial Measures to Investors
CSI uses Adjusted EBITDA as a supplemental measure of performance and believes this measure facilitates operating performance comparisons from period to period and company to company by factoring out potential differences caused by depreciation and amortization expense and stock-based compensation. CSI's management uses Adjusted EBITDA to analyze the underlying trends in CSI's business, assess the performance of CSI's core operations, establish operational goals and forecasts that are used to allocate resources and evaluate CSI's performance period over period and in relation to its competitors' operating results. Additionally, CSI's management is evaluated on the basis of Adjusted EBITDA when determining achievement of their incentive compensation performance targets.
CSI believes that presenting Adjusted EBITDA provides investors greater transparency to the information used by CSI's management for its financial and operational decision-making and allows investors to see CSI's results "through the eyes" of management. CSI also believes that providing this information better enables CSI's investors to understand CSI's operating performance and evaluate the methodology used by CSI's management to evaluate and measure such performance.
The following is an explanation of each of the items that management excluded from Adjusted EBITDA and the reasons for excluding each of these individual items:
-- Stock-based compensation. CSI excludes stock-based compensation expense from its non-GAAP financial measures primarily because such expense, while constituting an ongoing and recurring expense, is not an expense that requires cash settlement. CSI's management also believes that excluding this item from CSI's non-GAAP results is useful to investors to understand the application of stock-based compensation guidance and its impact on CSI's operational performance, liquidity and its ability to make additional investments in the company, and it allows for greater transparency to certain line items in CSI's financial statements.
-- Depreciation and amortization expense. CSI excludes depreciation and amortization expense from its non-GAAP financial measures primarily because such expenses, while constituting ongoing and recurring expenses, are not expenses that require cash settlement and are not used by CSI's management to assess the core profitability of CSI's business operations. CSI's management also believes that excluding these items from CSI's non-GAAP results is useful to investors to understand CSI's operational performance, liquidity and its ability to make additional investments in the company.
Material Limitations Associated with the Use of Non-GAAP Financial Measures and Manner in which CSI Compensates for these Limitations
Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for CSI's financial results prepared in accordance with GAAP. Some of the limitations associated with CSI's use of these non-GAAP financial measures are:
-- Items such as stock-based compensation do not directly affect CSI's cash flow position; however, such items reflect economic costs to CSI and are not reflected in CSI's "Adjusted EBITDA" and therefore these non-GAAP measures do not reflect the full economic effect of these items.
-- Non-GAAP financial measures are not based on any comprehensive set of accounting rules or principles and therefore other companies may calculate similarly titled non-GAAP financial measures differently than CSI, limiting the usefulness of those measures for comparative purposes.
-- CSI's management exercises judgment in determining which types of charges or other items should be excluded from the non-GAAP financial measures CSI uses. CSI compensates for these limitations by relying primarily upon its GAAP results and using non-GAAP financial measures only supplementally. CSI provides full disclosure of each non-GAAP financial measure.
-- CSI provides detailed reconciliations of each non-GAAP measure to its most directly comparable GAAP measure. CSI encourages investors to review these reconciliations. CSI qualifies its use of non-GAAP financial measures with cautionary statements as set forth above.
View source version on businesswire.com: https://www.businesswire.com/news/home/20221103005162/en/
Vice President, Investor Relations & Corporate Communications
(651) 202-4919
j.nielsen@csi360.com
Source:
FAQ
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