Treace Medical Concepts Reports Second Quarter 2024 Financial Results
Treace Medical Concepts (NASDAQ: TMCI) reported its Q2 2024 financial results, showing revenue growth of 6% to $44.5 million compared to Q2 2023. The company's gross margin was 80.2%, slightly down from 81.7% in the previous year. Despite revenue growth, Treace faced a net loss of $21.2 million, or ($0.34) per share, wider than the $12.3 million loss in Q2 2023. The increased loss was attributed to higher operating expenses, which rose to $57.1 million from $47.3 million year-over-year. Treace maintains a strong cash position of $97.0 million and reaffirmed its full-year 2024 revenue guidance of $201-$211 million, representing 7-13% growth. The company expects Adjusted EBITDA to improve by approximately 50% compared to 2023.
Treace Medical Concepts (NASDAQ: TMCI) ha riportato i risultati finanziari del secondo trimestre del 2024, evidenziando una crescita dei ricavi del 6% a 44,5 milioni di dollari rispetto al secondo trimestre del 2023. Il margine lordo dell'azienda è stato dell'80,2%, leggermente in calo rispetto all'81,7% dell'anno precedente. Nonostante la crescita dei ricavi, Treace ha registrato una perdita netta di 21,2 milioni di dollari, ovvero ($0,34) per azione, superiore alla perdita di 12,3 milioni di dollari nel secondo trimestre del 2023. L’aumento della perdita è stato attribuito a spese operative più elevate, salite a 57,1 milioni di dollari rispetto ai 47,3 milioni dell'anno precedente. Treace mantiene una solida posizione di cassa di 97 milioni di dollari e ha confermato le previsioni di ricavi per l'intero anno 2024 tra 201 e 211 milioni di dollari, che rappresentano una crescita del 7-13%. L'azienda prevede un miglioramento dell'EBITDA rettificato di circa il 50% rispetto al 2023.
Treace Medical Concepts (NASDAQ: TMCI) informó sus resultados financieros del segundo trimestre de 2024, mostrando un crecimiento en los ingresos del 6% a 44,5 millones de dólares en comparación con el segundo trimestre de 2023. El margen bruto de la empresa fue del 80,2%, ligeramente inferior al 81,7% del año anterior. A pesar del crecimiento de ingresos, Treace enfrentó una pérdida neta de 21,2 millones de dólares, o ($0,34) por acción, más amplia que la pérdida de 12,3 millones de dólares en el segundo trimestre de 2023. El aumento de la pérdida se atribuyó a gastos operativos más altos, que aumentaron a 57,1 millones de dólares desde 47,3 millones de dólares en el año previo. Treace mantiene una sólida posición de efectivo de 97 millones de dólares y reafirmó su guía de ingresos para todo el año 2024 de entre 201 y 211 millones de dólares, representando un crecimiento del 7-13%. La empresa espera que el EBITDA ajustado mejore en aproximadamente un 50% en comparación con 2023.
트리스 메디컬 컨셉스 (NASDAQ: TMCI)는 2024년 2분기 재무 결과를 보고하며 수익이 6% 증가하여 4,450만 달러에 달했다고 발표했습니다. 2023년 2분기와 비교할 때, 회사의 총 마진은 80.2%로, 작년의 81.7%에서 소폭 감소했습니다. 수익이 증가했음에도 불구하고, Treace는 2억 1천 2백만 달러의 순손실을 기록했으며, 이는 주당 ($0.34)로 2023년 2분기의 1,230만 달러 손실보다 더 큰 수치입니다. 증가한 손실은 운영비용 상승에 기인하며, 이는 작년 4,730만 달러에서 5,710만 달러로 증가했습니다. Treace는 9,700만 달러의 강력한 현금 위치를 유지하고 있으며, 2024년 전체 연도 수익 지침을 2억 1천만 달러에서 2억 1,100만 달러로 재확인했습니다, 이는 7-13% 성장에 해당합니다. 이 회사는 2023년 대비 약 50% 개선된 조정 EBITDA를 기대하고 있습니다.
Treace Medical Concepts (NASDAQ: TMCI) a annoncé ses résultats financiers pour le deuxième trimestre 2024, montrant
Treace Medical Concepts (NASDAQ: TMCI) hat seine finanziellen Ergebnisse für das zweite Quartal 2024 bekannt gegeben und zeigt einen Umsatzanstieg von 6% auf 44,5 Millionen USD im Vergleich zum zweiten Quartal 2023. Die Bruttomarge des Unternehmens betrug 80,2%, leicht gesunken von 81,7% im Vorjahr. Trotz des Umsatzwachstums verzeichnete Treace einen Nettoverlust von 21,2 Millionen USD, oder ($0,34) pro Aktie, was größer ist als der Verlust von 12,3 Millionen USD im zweiten Quartal 2023. Der gestiegene Verlust wurde auf höhere Betriebskosten zurückgeführt, die von 47,3 Millionen USD auf 57,1 Millionen USD im Jahresvergleich gestiegen sind. Treace hält eine starke Liquiditätsposition von 97 Millionen USD und hat die Umsatzprognosen für das Gesamtjahr 2024 von 201-211 Millionen USD erneut bestätigt, was ein Wachstum von 7-13% darstellt. Das Unternehmen erwartet, dass das bereinigte EBITDA im Vergleich zu 2023 um etwa 50% steigen wird.
- Revenue increased by 6% year-over-year to $44.5 million
- Gross margin remained strong at 80.2%
- Patent portfolio expanded to 65 granted U.S. patents
- Active surgeon base increased
- Company reaffirmed full-year 2024 revenue guidance of $201-$211 million
- Adjusted EBITDA expected to improve by approximately 50% in 2024
- Net loss widened to $21.2 million from $12.3 million in Q2 2023
- Operating expenses increased significantly to $57.1 million from $47.3 million
- Gross margin decreased from 81.7% to 80.2% year-over-year
- Adjusted EBITDA loss increased to $8.7 million from $7.7 million in Q2 2023
Insights
Treace Medical Concepts' Q2 2024 results show mixed signals. While revenue increased
The company's increased operating expenses of
With
Treace's focus on bunion and midfoot deformity treatments through its Lapiplasty® and Adductoplasty® Procedures represents a niche market with growth potential. The expansion of their patent portfolio to 65 U.S. patents and 22 international patents strengthens their intellectual property position, potentially creating barriers to entry for competitors.
The planned entry into the minimally invasive metatarsal osteotomy market in Q4 2024 could open up new revenue streams. This move aligns with the trend towards less invasive surgical procedures, which often lead to faster recovery times and improved patient outcomes.
However, the company's reliance on a base of over 3,000 active surgeons highlights the importance of surgeon adoption and training. The success of new product launches will largely depend on effectively educating and onboarding surgeons to these new technologies.
The 6% revenue growth in Q2 2024 suggests Treace is maintaining its market position but facing challenges in accelerating growth. The company's strategy of focusing on product mix shift and increasing adoption of newer technologies appears to be yielding results, albeit modestly.
The planned entry into the minimally invasive metatarsal osteotomy market in Q4 is a strategic move to diversify revenue streams. However, as a "relatively nascent" market, it may require significant investment in education and marketing to drive adoption.
Treace's ability to improve its Adjusted EBITDA by approximately
PONTE VEDRA, Fla., Aug. 06, 2024 (GLOBE NEWSWIRE) -- Treace Medical Concepts, Inc. ("Treace" or the "Company") (NasdaqGS: TMCI), a medical technology company driving a fundamental shift in the surgical treatment of bunions and related midfoot deformities through its flagship Lapiplasty® and Adductoplasty® Procedures, today reported financial results for the second quarter ended June 30, 2024.
Recent Highlights
- Revenue of
$44.5 million in second quarter 2024 increased6% over same period in 2023 - Gross margin of
80.2% in second quarter 2024 - Patent portfolio expands to 65 granted U.S. patents, with an additional 22 granted patents worldwide and 84 pending U.S. patent applications
John T. Treace, CEO and Founder of Treace, said, "Second quarter results came in as expected. We remain focused on capturing an even larger share of procedure volumes from our base of over 3,000 active surgeons with several new planned product launches in the second half of 2024, including our entry into the relatively nascent minimally invasive metatarsal osteotomy market in Q4. We are confident in our strategic investments in our growing portfolio of innovative, reproducible solutions for a dynamic bunion market, supporting our market position and long-term outlook.”
Second Quarter 2024 Financial Results
Revenue for the second quarter of 2024 was
Gross profit for the second quarter of 2024 was
Total operating expenses were
Second quarter 2024 net loss attributable to common stockholders was (
Cash, cash equivalents, marketable securities and investment receivable totaled
Financial Outlook
The Company is reaffirming full-year 2024 revenue guidance of
The Company continues to expect Adjusted EBITDA to improve approximately
* A reconciliation of Adjusted EBITDA to GAAP net loss on a forward-looking basis is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to the items excluded from this non-GAAP measure.
Webcast and Conference Call Details
Treace will host a conference call today, August 6, 2024, at 4:30 p.m. ET to discuss its second quarter 2024 financial results. Investors interested in listening to the conference call may do so by registering. Once registered, participants will receive dial-in numbers and a unique pin to join the call and ask questions. The live webcast of the conference call will be available on the Investor Relations section of the Company’s website at investors.treace.com. The webcast will be archived on the website following the completion of the call.
Use of Non-GAAP Financial Measures
To supplement the financial results presented in accordance with GAAP, this earnings release presents Adjusted EBITDA, which the Company defines as net loss before depreciation and amortization expense, interest income, interest expense, taxes, share-based compensation expense, acquisition-related costs, restructuring costs, customer credit loss, and debt extinguishment loss. Non-GAAP financial measures such as Adjusted EBITDA are presented in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Management uses non-GAAP financial measures to evaluate the Company’s operating performance and trends, as well as for making planning decisions. The Company believes that Adjusted EBITDA helps to identify underlying trends in the Company’s business that may otherwise be masked by the effect of the income and expenses and other items that it excludes in its calculation of Adjusted EBITDA. Accordingly, the Company believes this non-GAAP financial measure provides useful information to investors and others in understanding and evaluating the Company’s operating results, enhancing the overall understanding of its past performance and future prospects, and allowing for greater transparency with respect to key financial metrics used by the Company’s management in their financial and operational decision-making. The Company also presents this non-GAAP financial measure because it believes investors, analysts and rating agencies consider it to be a useful metric in measuring the Company’s performance against other companies and its ability to meet its debt service obligations.
There are limitations related to the use of non-GAAP financial measures such as Adjusted EBITDA because they are not prepared in accordance with GAAP, may exclude significant income and expenses required by GAAP to be recognized in the Company’s financial statements, and may not be comparable to non-GAAP financial measures used by other companies. The Company encourages investors to carefully consider its results under GAAP, as well as its supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand its business. A reconciliation between GAAP and non-GAAP results is presented below.
Forward-Looking Statements
This press release and statements made during the Company’s earnings call contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements, including, but not limited to, the Company’s: revenue guidance and estimated revenue growth rates for full-year 2024; estimated quarterly revenue growth rates; ability to effectively respond to and mitigate the impact of challenges in the current market environment, including in response to increased competition and accelerating adoption of MIS osteotomy solutions; ability to effectively reduce costs and right size the Company’s P&L and the future impact of the right sizing; anticipated future product launches and the timing of such product launches, including its planned 3D MIS osteotomy platforms; ability to increase its procedure volumes and gain market share; strategic investments supporting its market position and long-term outlook; ability to protect and enforce its intellectual property rights; success in defending against infringement of its intellectual property by third parties, including its competitors; expected seasonality; anticipated pace of growth in the foot and ankle market; sufficient balance sheet strength and flexibility to continue effectively executing on its strategic investments and growth initiatives for the foreseeable future; anticipated liquidity; and expectation of progress in Adjusted EBITDA for full-year 2024 and expected rate of Adjusted EBITDA improvement. Forward-looking statements are based on management’s current assumptions and expectations of future events and trends, which affect or may affect the Company’s business, strategy, operations or financial performance, and actual results and other events may differ materially from those expressed or implied in such statements due to numerous risks and uncertainties. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Factors that could cause actual results or other events to differ materially from those contemplated in this press release can be found in the Risk Factors section of Treace’s public filings with the Securities and Exchange Commission (SEC), including its Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 27, 2024, and its subsequent SEC filings. Because forward-looking statements are inherently subject to risks and uncertainties, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements speak only as of their date and, except to the extent required by law, the Company undertakes no obligation to update these statements, whether as a result of any new information, future developments or otherwise. The Company’s results for the quarter ended June 30, 2024 are not necessarily indicative of its operating results for any future periods.
Internet Posting of Information
Treace routinely posts information that may be important to investors in the “Investor Relations” section of its website at www.treace.com. The Company encourages investors and potential investors to consult the Treace website regularly for important information about Treace.
About Treace Medical Concepts
Treace Medical Concepts, Inc. is a medical technology company with the goal of advancing the standard of care for the surgical management of bunion and related midfoot deformities. Bunions are complex 3-dimensional deformities that originate from an unstable joint in the middle of the foot and affect approximately 67 million Americans, of which Treace estimates 1.1 million are annual surgical candidates. Treace has pioneered and patented the Lapiplasty® 3D Bunion Correction® System – a combination of instruments, implants, and surgical methods designed to surgically correct all three planes of the bunion deformity and secure the unstable joint, addressing the root cause of the bunion and helping patients get back to their active lifestyles. To further support the needs of bunion patients, Treace has introduced its Adductoplasty® Midfoot Correction System, designed for reproducible surgical correction of the midfoot as well as its Hammertoe PEEK Fixation System designed to address hammertoe, claw toe and mallet toe deformities. The Company continues to expand its footprint in the foot and ankle market with the introduction of its SpeedPlate™ Rapid Compression Implants, an innovative fixation platform with broad versatility across Lapiplasty® and Adductoplasty® procedures, as well as other common bone fusion procedures of the foot. For more information, please visit www.treace.com.
To learn more about Treace, connect with us on LinkedIn, X, Facebook and Instagram.
Contacts:
Treace Medical Concepts
Mark L. Hair
Chief Financial Officer
mhair@treace.net
(904) 373-5940
Investors:
Gilmartin Group
Vivian Cervantes
IR@treace.net
| Treace Medical Concepts, Inc. Statements of Operations and Comprehensive Loss (in thousands, except share and per share amounts) (unaudited) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Revenue | $ | 44,455 | $ | 41,953 | $ | 95,563 | $ | 84,148 | |||||||
| Cost of goods sold | 8,781 | 7,675 | 18,908 | 15,714 | |||||||||||
| Gross profit | 35,674 | 34,278 | 76,655 | 68,434 | |||||||||||
| Operating expenses | |||||||||||||||
| Sales and marketing | 37,681 | 33,773 | 78,009 | 67,428 | |||||||||||
| Research and development | 5,157 | 3,526 | 10,416 | 6,938 | |||||||||||
| General and administrative | 14,218 | 10,031 | 28,580 | 20,896 | |||||||||||
| Total operating expenses | 57,056 | 47,330 | 117,005 | 95,262 | |||||||||||
| Loss from operations | (21,382 | ) | (13,052 | ) | (40,350 | ) | (26,828 | ) | |||||||
| Interest income | 1,376 | 1,968 | 2,911 | 3,447 | |||||||||||
| Interest expense | (1,312 | ) | (1,282 | ) | (2,629 | ) | (2,567 | ) | |||||||
| Other income, net | 112 | 95 | 186 | 223 | |||||||||||
| Other non-operating income (expense), net | 176 | 781 | 468 | 1,103 | |||||||||||
| Net loss | $ | (21,206 | ) | $ | (12,271 | ) | $ | (39,882 | ) | $ | (25,725 | ) | |||
| Other comprehensive income (loss) | |||||||||||||||
| Unrealized gain (loss) on marketable securities | $ | (95 | ) | $ | (163 | ) | $ | (189 | ) | $ | (192 | ) | |||
| Comprehensive loss | $ | (21,301 | ) | $ | (12,434 | ) | $ | (40,071 | ) | $ | (25,917 | ) | |||
| Net loss per share attributable to common stockholders, basic and diluted | $ | (0.34 | ) | $ | (0.20 | ) | $ | (0.64 | ) | $ | (0.43 | ) | |||
| Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted | 62,081,494 | 61,382,514 | 61,937,140 | 60,060,483 | |||||||||||
| Treace Medical Concepts, Inc. Balance Sheets (in thousands, except share and per share amounts) (unaudited) | |||||||
| June 30, | December 31, | ||||||
| 2024 | 2023 | ||||||
| Assets | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 18,181 | $ | 12,982 | |||
| Marketable securities, short-term | 76,865 | 110,216 | |||||
| Accounts receivable, net of allowance for credit losses of | 25,559 | 38,063 | |||||
| Inventories | 41,279 | 29,245 | |||||
| Prepaid expenses and other current assets | 9,668 | 7,853 | |||||
| Total current assets | 171,552 | 198,359 | |||||
| Property and equipment, net | 24,245 | 22,298 | |||||
| Intangible assets, net of accumulated amortization of | 8,550 | 9,025 | |||||
| Goodwill | 12,815 | 12,815 | |||||
| Operating lease right-of-use assets | 8,775 | 9,264 | |||||
| Other non-current assets | 146 | 146 | |||||
| Total assets | $ | 226,083 | $ | 251,907 | |||
| Liabilities and Stockholders’ Equity | |||||||
| Current liabilities | |||||||
| Accounts payable | $ | 18,073 | $ | 11,835 | |||
| Accrued liabilities | 13,730 | 10,458 | |||||
| Accrued commissions | 5,931 | 10,759 | |||||
| Accrued compensation | 6,192 | 7,549 | |||||
| Other liabilities | 520 | 4,432 | |||||
| Total current liabilities | 44,446 | 45,033 | |||||
| Long-term debt, net of discount of | 53,157 | 53,008 | |||||
| Operating lease liabilities, net of current portion | 16,302 | 15,891 | |||||
| Other long-term liabilities | 37 | 37 | |||||
| Total liabilities | 113,942 | 113,969 | |||||
| Commitments and contingencies (Note 7) | |||||||
| Stockholders’ equity | |||||||
| Preferred stock, | — | — | |||||
| Common stock, | 62 | 62 | |||||
| Additional paid-in capital | 286,484 | 271,973 | |||||
| Accumulated deficit | (174,129 | ) | (134,247 | ) | |||
| Accumulated other comprehensive (loss) income | (26 | ) | 163 | ||||
| Treasury stock, at cost; 19,604 and 1,218 shares as of June 30, 2024 and December 31, 2023, respectively | (250 | ) | (13 | ) | |||
| Total stockholders’ equity | 112,141 | 137,938 | |||||
| Total liabilities and stockholders’ equity | $ | 226,083 | $ | 251,907 | |||
| Treace Medical Concepts, Inc. Statements of Cash Flows (in thousands) (unaudited) | |||||||
| Six Months Ended June 30, | |||||||
| 2024 | 2023 | ||||||
| Cash flows from operating activities | |||||||
| Net loss | $ | (39,882 | ) | $ | (25,725 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities | |||||||
| Depreciation and amortization expense | 4,025 | 2,019 | |||||
| Provision for allowance for credit losses | 2,207 | 78 | |||||
| Share-based compensation expense | 14,148 | 6,288 | |||||
| Non-cash lease expense | 1,182 | 1,264 | |||||
| Amortization of debt issuance costs | 149 | 148 | |||||
| Accretion (amortization) of discount (premium) on marketable securities, net | (685 | ) | (663 | ) | |||
| Other, net | 159 | 5 | |||||
| Net changes in operating assets and liabilities, net of acquisitions | |||||||
| Accounts receivable | 10,297 | 1,886 | |||||
| Inventory | (12,034 | ) | (6,704 | ) | |||
| Prepaid expenses and other assets | 185 | (1,641 | ) | ||||
| Operating lease liabilities | (1,291 | ) | 1,072 | ||||
| Accounts payable | 6,238 | (522 | ) | ||||
| Accrued liabilities | (5,943 | ) | (3,137 | ) | |||
| Other, net | 127 | 38 | |||||
| Net cash used in operating activities | (21,118 | ) | (25,594 | ) | |||
| Cash flows from investing activities | |||||||
| Purchases of available-for-sale marketable securities | (28,711 | ) | (120,957 | ) | |||
| Sales and maturities of available-for-sale marketable securities | 60,558 | 55,763 | |||||
| Purchases of property and equipment | (5,656 | ) | (5,709 | ) | |||
| Acquisition, net of cash acquired | — | (20,000 | ) | ||||
| Net cash provided by (used in) investing activities | 26,191 | (90,903 | ) | ||||
| Cash flows from financing activities | |||||||
| Proceeds from issuance of common stock from public offering, net of issuance costs and underwriting discount of | — | 107,527 | |||||
| Proceeds from exercise of employee stock options | 363 | 1,532 | |||||
| Taxes from withheld shares | (237 | ) | — | ||||
| Net cash provided by (used in) financing activities | 126 | 109,059 | |||||
| Net increase (decrease) in cash and cash equivalents | 5,199 | (7,438 | ) | ||||
| Cash and cash equivalents at beginning of period | 12,982 | 19,473 | |||||
| Cash and cash equivalents at end of period | $ | 18,181 | $ | 12,035 | |||
| Supplemental disclosure of cash flow information | |||||||
| Cash paid for interest | $ | 2,490 | $ | 2,567 | |||
| Operating lease right-of-use asset and lease liability adjustment due to lease incentive | $ | 86 | $ | (13 | ) | ||
| Noncash investing activities | |||||||
| Unrealized (gains) losses, net on marketable securities | $ | 189 | $ | 192 | |||
| Unsettled matured marketable security and receivable from broker | $ | 2,000 | $ | — | |||
| Treace Medical Concepts, Inc. Reconciliation of GAAP Net Loss to EBITDA & Adjusted EBITDA (in thousands) (unaudited) | |||||||||||||||
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Net loss | $ | (21,206 | ) | $ | (12,271 | ) | $ | (39,882 | ) | $ | (25,725 | ) | |||
| Adjustments: | |||||||||||||||
| Interest income | (1,376 | ) | (1,968 | ) | (2,911 | ) | (3,447 | ) | |||||||
| Interest expense | 1,312 | 1,282 | 2,629 | 2,567 | |||||||||||
| Taxes | — | — | — | — | |||||||||||
| Depreciation & Amortization | 2,116 | 1,095 | 4,025 | 2,019 | |||||||||||
| EBITDA | $ | (19,154 | ) | $ | (11,862 | ) | $ | (36,139 | ) | $ | (24,586 | ) | |||
| Share-based compensation expense | 6,740 | 3,596 | 14,148 | 6,288 | |||||||||||
| Acquisition-related costs | 556 | 520 | 1,873 | 520 | |||||||||||
| Restructuring costs1 | 964 | — | 964 | — | |||||||||||
| Customer credit loss2 | 2,147 | — | 2,147 | — | |||||||||||
| Adjusted EBITDA | $ | (8,747 | ) | $ | (7,746 | ) | $ | (17,007 | ) | $ | (17,778 | ) | |||
1 Restructuring charges primarily relate to severance payments and other post-employment benefits from a restructuring in June 2024.
2 Customer credit loss consists of the write-off of accounts receivable due from a customer that filed for bankruptcy during the second quarter of 2024.
FAQ
What was Treace Medical Concepts' (TMCI) revenue for Q2 2024?
How did Treace Medical Concepts' (TMCI) net loss change in Q2 2024 compared to Q2 2023?
What is Treace Medical Concepts' (TMCI) revenue guidance for full-year 2024?
How many active surgeons does Treace Medical Concepts (TMCI) have in its base?
