LeMaitre Q2 2022 Financial Results

Rhea-AI Summary

LeMaitre (LMAT) reported Q2 2022 sales of $42.1 million, up 4% year-over-year. Gross margin increased to 66.0%. However, operating income fell 48% to $5.8 million, and EPS declined by 60% to $0.16. The company announced a quarterly dividend of $0.125/share and increased guidance for 2022 to 10% organic growth. Key growth drivers included biologics, especially XenoSure (+21%).

The company closed its St. Etienne factory, incurring a $3.1 million special charge.

Positive

• Sales growth of 4% year-over-year to $42.1 million.
• Increased annual guidance to 10% organic growth.
• Strong performance in biologics with XenoSure up 21%, allografts up 25%, Artegraft up 11%.
• Cash and investments rose by $4.8 million to $75.7 million.

Negative

• Operating income decreased by 48% to $5.8 million.
• Earnings per share reduced by 60% to $0.16.
• Special charge of $3.1 million from factory closure.

BURLINGTON, Mass., July 28, 2022 (GLOBE NEWSWIRE) -- LeMaitre (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q2 2022 results, announced a $0.125/share quarterly dividend and provided guidance.

Q2 2022 Financial Results

• Sales of $42.1mm, +4% (+8% organic) vs. Q2 2021
• Gross margin of 66.0%
• Op. income reported $5.8mm, -48%
• Op. income ex. special charge $8.9mm, -20%
• Earnings per diluted share reported $0.16, -60%
• Earnings per diluted share ex. special charge $0.29, -26%
• Cash and investments +$4.8mm to $75.7mm

Biologics drove Q2 2022 sales growth: XenoSure (+21%), allografts (+25%) and Artegraft (+11%). Q2 organic sales growth was led by EMEA (+11%) and APAC (+11%), while the Americas grew 6%. The strong dollar reduced sales by $1.7mm.

The gross margin increased to 66.0% in Q2 2022 (vs. 65.8%). The Company had 203 direct labor employees on staff as of June 30, up 54% year-over-year. The Company closed its St. Etienne factory in Q2 2022, resulting in a $3.1mm special charge.

Q2 2022 operating margin was 14%; excluding the $3.1mm special charge the operating margin was 21%. Excluding the special charge, Q2 operating expense growth was 21%, driven by a 26% larger salesforce on June 30 (111 reps) and regulatory expenses.

George LeMaitre, Chairman and CEO, said “Based on better-than-expected Q2 sales, we increased annual guidance to 10% organic growth. We also achieved several milestones: we opened a Seoul office, closed a French factory, filed for Chinese XenoSure cardiac approval and received the Omniflow II CE Mark.”

Business Outlook

	Q3 2022 Guidance	Q4 2022 Guidance	2022 Full Year Guidance
Sales	$39.0mm - $41.0mm (Mid: $40.0mm, +4%, +10% Org.)	$41.2mm - $43.2mm (Mid: $42.2mm, +7%, +11% Org.)	$162.7mm - $165.3mm (Mid:$164.0mm, +6%, +10% Org.)
Gross Margin	66.7%	67.5%	66.5%
Op. Income	$6.8mm - $8.2mm (Mid: $7.5mm, -17%)	$8.5mm - $9.9mm (Mid: $9.2mm, +10%)	$29.5mm - $31.2mm (Mid $30.4mm, -17%)
Op. Income Ex-Spec. Charge	-	-	$32.7mm - $34.4mm (Mid: $33.6mm, -8%)
EPS	$0.24 - $0.29 (Mid: $0.27, -10%)	$0.29 - $0.35 (Mid: $0.32, +15%)	$0.99 - $1.05 (Mid: $1.02, -19%)
EPS Ex-Spec. Charge	-	-	$1.14 - $1.19 (Mid: $1.17, -7%)

Quarterly Dividend

On July 26, 2022, the Company's Board of Directors approved a quarterly dividend of $0.125/share of common stock. The dividend will be paid on September 8, 2022 to shareholders of record on August 25, 2022.

Share Repurchase Program

On February 22, 2022, the Company's Board of Directors authorized the repurchase of up to $20.0mm of the Company’s common stock. The repurchase program may be suspended or discontinued at any time and will conclude on February 22, 2023, unless extended by the Board.

Conference Call Reminder

Management will conduct a conference call at 5:00pm ET today. The conference call will be broadcast live over the Internet. Individuals interested in listening to the webcast can log on to the Company's website at www.lemaitre.com/investor. Access to the live call is available by registering online here. All registrants will receive dial-in information and a PIN allowing them to access the live call. The audio webcast can also be accessed live or via replay through a webcast at http://www.lemaitre.com/investor. For individuals unable to join the live conference call, a replay will be available on the Company's website.

A reconciliation of GAAP to non-GAAP results is included in the tables attached to this release.

About LeMaitre

LeMaitre is a provider of devices, implants and services for the treatment of peripheral vascular disease, a condition that affects more than 200 million people worldwide. The Company develops, manufactures and markets disposable and implantable vascular devices to address the needs of its core customer, the vascular surgeon.

LeMaitre is a registered trademark of LeMaitre Vascular, Inc. This press release may include other trademarks and trade names of the Company.

For more information about the Company, please visit http://www.lemaitre.com.

Use of Non-GAAP Financial Measures

LeMaitre management believes that in order to better understand the Company's short- and long-term financial trends, investors may wish to consider certain non-GAAP financial measures as a supplement to financial performance measures prepared in accordance with GAAP. Non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and do not have standardized meanings. These non-GAAP measures result from facts and circumstances that may vary in frequency and/or impact on continuing operations. Non-GAAP measures should be considered in addition to, and not as a substitute for, financial performance measures in accordance with GAAP. In addition to the description provided below, reconciliation of GAAP to non-GAAP results is provided in the financial statement tables included in this press release.

In this press release, the Company has reported non-GAAP sales growth percentages after adjusting for the impact of foreign currency exchange, business development transactions, and/or other events as well as operating income, operating margin, and EPS excluding special charge for Q2 2022 and guidance for operating income and EPS excluding special charge. The Company refers to the calculation of non-GAAP sales growth percentages as "organic." The Company analyzes non-GAAP sales on a constant currency basis, net of acquisitions and other non-recurring events, and the aforementioned non-GAAP profitability measures to better measure the comparability of results between periods. Because changes in foreign currency exchange rates have a non-operating impact on net sales, and acquisitions, divestitures, product discontinuations, and other strategic transactions are episodic in nature and are highly variable to the reported sales results, the Company believes that evaluating growth in sales on a constant currency basis net of such transactions provides an additional and meaningful assessment of sales to management. The Company believes that the presentation of operating income, operating margin and EPS excluding special charge for Q2 2022 and guidance for operating income and EPS excluding special charge provides an alternative and meaningful view of the Company’s profitability excluding the impact of the closure of the Company’s St. Etienne, France factory, a non-recurring event.

Forward-Looking Statements

The Company's current financial results, as discussed in this release, are preliminary and unaudited, and subject to adjustment. This press release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Statements in this press release regarding the Company's business that are not historical facts may be "forward-looking statements" that involve risks and uncertainties. Forward-looking statements are based on management's current, preliminary expectations and are subject to risks and uncertainties that could cause actual results to differ from the results expected, including, but not limited to, the status of our global regulatory approvals and compliance with regulatory requirements to market and sell our products both in the U.S. and outside of the U.S.; the duration and severity of the impact of COVID-19 on the global economy, our customers, our suppliers and our company; the risk of significant fluctuations in our quarterly and annual results due to numerous factors; the risk that assumptions about the market for the Company’s products and the productivity of the Company’s direct sales force and distributors may not be correct; the risk that we may not be able to maintain our recent levels of profitability; the risk that the Company may not realize the anticipated benefits of its strategic activities; risks related to the integration of acquisition targets; the acceleration or deceleration of product growth rates; risks related to product demand and market acceptance of the Company’s products and pricing; the risk that a recall of our products could result in significant costs or negative publicity; the risk that the Company is not successful in transitioning to a direct-selling model in new territories and other risks and uncertainties included under the heading "Risk Factors" in our most recent Annual Report on Form 10-K, as updated by our subsequent filings with the SEC, which are all available on the Company's investor relations website at http://www.lemaitre.com and on the SEC's website at http://www.sec.gov. Undue reliance should not be placed on forward-looking statements, which speak only as of the date they are made. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events, or circumstances after the date they were made, or to reflect the occurrence of unanticipated events.

CONTACT: 
J.J. Pellegrino, CFO, LeMaitre
781-425-1691
jjpellegrino@lemaitre.com

 

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)
CONDENSED CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
			June 30, 2022				December 31, 2021
			(unaudited)
Assets
Current assets:
	Cash and cash equivalents		$	20,788			$	13,855
	Short-term marketable securities			54,895				56,104
	Accounts receivable, net			21,542				19,631
	Inventory and other deferred costs			47,192				46,104
	Prepaid expenses and other current assets			3,243				4,189
	Asset held for sale			826				-
Total current assets				148,486				139,883
Property and equipment, net				15,753				17,059
Right-of-use leased assets				16,290				15,071
Goodwill				65,945				65,945
Other intangibles, net				49,598				52,710
Deferred tax assets				2,369				1,566
Other assets				984				568
Total assets			$	299,425			$	292,802
Liabilities and stockholders' equity
Current liabilities:
	Accounts payable		$	2,844			$	2,340
	Accrued expenses			17,009				16,332
	Acquisition-related obligations			1,758				1,271
	Lease liabilities - short-term			1,794				1,870
Total current liabilities				23,405				21,813
Lease liabilities - long-term				15,420				14,067
Deferred tax liabilities				64				70
Other long-term liabilities				2,503				2,701
Total liabilities				41,392				38,651
Stockholders' equity
	Common stock			235				235
	Additional paid-in capital			184,605				181,630
	Retained earnings			92,190				88,125
	Accumulated other comprehensive loss			(6,444	)			(3,435	)
	Treasury stock			(12,553	)			(12,404	)
Total stockholders' equity				258,033				254,151
Total liabilities and stockholders' equity			$	299,425			$	292,802

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(amounts in thousands, except per share amounts)
(unaudited)
		For the three months ended								For the six months ended
		June 30, 2022				June 30, 2021				June 30, 2022				June 30, 2021
Net sales		$	42,108			$	40,670			$	81,669			$	76,553
Cost of sales			14,298				13,909				27,897				25,993
Gross profit			27,810				26,761				53,772				50,560
Operating expenses:
	Sales and marketing		8,242				6,803				16,092				13,269
	General and administrative		7,331				6,200				14,583				12,744
	Research and development		3,346				2,652				6,278				5,496
	Restructuring		3,107				-				3,107				-
Total operating expenses			22,026				15,655				40,060				31,509
Income from operations			5,784				11,106				13,712				19,051
Other income (expense), net
	Interest income		167				1				275				2
	Interest expense		-				(495	)			-				(1,072	)
	Foreign currency gain (loss)		(403	)			(157	)			(443	)			(33	)
Income before income taxes			5,548				10,455				13,544				17,948
Provision for income taxes			2,033				2,156				3,991				3,720
Net income		$	3,515			$	8,299			$	9,553			$	14,228
Earnings per share of common stock
	Basic	$	0.16			$	0.40			$	0.44			$	0.69
	Diluted	$	0.16			$	0.40			$	0.43			$	0.68
Weighted - average shares outstanding:
	Basic		21,958				20,611				21,947				20,579
	Diluted		22,129				20,959				22,115				20,900
Cash dividends declared per common share		$	0.125			$	0.110			$	0.250			$	0.220

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)
SELECTED NET SALES INFORMATION
(amounts in thousands)
(unaudited)
		For the three months ended												For the six months ended
		June 30, 2022						June 30, 2021						June 30, 2022						June 30, 2021
		$			%			$			%			$			%			$			%
Net Sales by Geography
	Americas	$	28,854		69	%		$	27,329		67	%		$	55,397		68	%		$	51,028		67	%
	Europe, Middle East and Africa		10,749		25	%			10,803		27	%			21,243		26	%			20,665		27	%
	Asia Pacific		2,505		6	%			2,538		6	%			5,029		6	%			4,860		6	%
Total Net Sales		$	42,108		100	%		$	40,670		100	%		$	81,669		100	%		$	76,553		100	%

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)
NON-GAAP FINANCIAL MEASURES
(amounts in thousands)
(unaudited)
Reconciliation between GAAP and Non-GAAP sales growth:
	For the three months ended June 30, 2022
		Net sales as reported		$	42,108
		Impact of currency exchange rate fluctuations			1,686
		Adjusted net sales						$	43,794
	For the three months ended June 30, 2021
		Net sales as reported		$	40,670
		Adjusted net sales						$	40,670
		Adjusted net sales increase for the three months ended June 30, 2022						$	3,124			8	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
	For the three months ending September 30, 2022
		Net sales per guidance (midpoint)		$	40,045
		Impact of currency exchange rate fluctuations			1,974
		Adjusted projected net sales						$	42,019
	For the three months ended September 30, 2021
		Net sales as reported		$	38,368
		Adjusted net sales						$	38,368
		Adjusted projected net sales increase for the three months ending September 30, 2022						$	3,651			10	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
	For the three months ending December 31, 2022
		Net sales per guidance (midpoint)		$	42,240
		Impact of currency exchange rate fluctuations			1,692
		Adjusted projected net sales						$	43,932
	For the three months ended December 31, 2021
		Net sales as reported		$	39,503
		Adjusted net sales						$	39,503
		Adjusted projected net sales increase for the three months ending December 31, 2022						$	4,429			11	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
	For the year ending December 31, 2022
		Net sales per guidance (midpoint)		$	163,954
		Impact of currency exchange rate fluctuations			6,170
		Adjusted projected net sales						$	170,124
	For the year ended December 31, 2021
		Net sales as reported		$	154,424
		Adjusted net sales						$	154,424
		Adjusted projected net sales increase for the year ending December 31, 2022						$	15,700			10	%
Reconciliation between GAAP and Non-GAAP operating income:
	For the three months ended June 30, 2022
		Operating income as reported		$	5,784
		Impact of special charge			3,107
		Adjusted operating income						$	8,891
	For the three months ended June 30, 2021
		Operating income as reported		$	11,106
		Adjusted operating income						$	11,106
		Adjusted operating income decrease for the three months ended June 30, 2022						$	(2,215	)		-20	%
Reconciliation between GAAP and Non-GAAP projected operating income:
	For the year ending December 31, 2022
		Operating income per guidance (midpoint)		$	30,374
		Impact of special charge			3,207
		Adjusted projected operating income						$	33,581
	For the year ended December 31, 2021
		Operating income as reported		$	36,425
		Adjusted operating income						$	36,425
		Adjusted projected operating income decrease for the year ending December 31, 2022						$	(2,844	)		-8	%
Reconciliation between GAAP and Non-GAAP EPS:
	For the three months ended June 30, 2022
		EPS as reported		$	0.16
		Impact of special charge			0.13
		Adjusted EPS						$	0.29
	For the three months ended June 30, 2021
		EPS as reported		$	0.40
		Adjusted EPS						$	0.40
		Adjusted EPS decrease for the three months ended June 30, 2022						$	(0.10	)		-26	%
Reconciliation between GAAP and Non-GAAP projected EPS:
	For the year ending December 31, 2022
		EPS per guidance (midpoint)		$	1.02
		Impact of special charge			0.15
		Adjusted EPS						$	1.17
	For the year ended December 31, 2021
		EPS as reported		$	1.25
		Adjusted EPS						$	1.25
		Adjusted projected EPS decrease for the year ending December 31, 2022						$	(0.08	)		-7	%
EMEA sales growth reconciliation between GAAP and Non-GAAP:
	For the three months ended June 30, 2022
		Net sales as reported		$	10,749
		Impact of currency exchange rate fluctuations			1,276
		EMEA adjusted net sales						$	12,025
	For the three months ended June 30, 2021
		Net sales as reported		$	10,803
		Adjusted net sales						$	10,803
		EMEA adjusted net sales increase for the three months ended June 30, 2022						$	1,222			11	%
APAC sales growth reconciliation between GAAP and Non-GAAP:
	For the three months ended June 30, 2022
		Net sales as reported		$	2,505
		Impact of currency exchange rate fluctuations			313
		APAC adjusted net sales						$	2,818
	For the three months ended June 30, 2021
		Net sales as reported		$	2,538
		Adjusted net sales						$	2,538
		APAC adjusted net sales increase for the three months ended June 30, 2022						$	280			11	%
Americas sales growth reconciliation between GAAP and Non-GAAP:
	For the three months ended June 30, 2022
		Net sales as reported		$	28,854
		Impact of currency exchange rate fluctuations			98
		Americas adjusted net sales						$	28,952
	For the three months ended June 30, 2021
		Net sales as reported		$	27,329
		Adjusted net sales						$	27,329
		Americas adjusted net sales increase for the three months ended June 30, 2022						$	1,623			6	%
Reconciliation between GAAP and Non-GAAP operating margin:
	For the three months ended June 30, 2022
		Operating margin as reported			14	%
		Impact of special charge			7	%
		Adjusted operating margin							21	%
Reconciliation between GAAP and Non-GAAP operating expenses:
	For the three months ended June 30, 2022
		Operating expenses as reported		$	22,026
		Impact of special charge			(3,107	)
		Adjusted operating expenses						$	18,919
	For the three months ended June 30, 2021
		Operating expenses as reported		$	15,655
		Adjusted operating income						$	15,655
		Adjusted operating expense decrease for the three months ended June 30, 2022						$	3,264			21	%

 

FAQ

What are LeMaitre's Q2 2022 financial results?

LeMaitre reported Q2 2022 sales of $42.1 million, a 4% increase from the prior year, but operating income fell 48% to $5.8 million.

What is the guidance for LeMaitre's 2022 growth?

LeMaitre increased its annual guidance to 10% organic growth based on better-than-expected Q2 sales.

What dividends did LeMaitre announce?

LeMaitre announced a quarterly dividend of $0.125 per share, payable on September 8, 2022.

What caused the special charges in Q2 2022?

LeMaitre incurred a $3.1 million special charge due to the closure of its St. Etienne factory.

How did currency fluctuations impact LeMaitre's sales?

A strong dollar reduced sales by $1.7 million in Q2 2022.