Vericel Reports First Quarter 2024 Financial Results and Raises Full-Year 2024 Financial Guidance
Vericel (NASDAQ:VCEL) reported a 25% increase in total revenue to $51.3 million in the first quarter of 2024. The company achieved record revenue for MACI of $40.2 million and saw a 63% growth in Burn Care revenue. Adjusted EBITDA grew by 325%. The full-year 2024 revenue guidance was raised to $238-$242 million. Vericel had a strong start to the year with significant margin expansion and profitability growth, positioning the company well for continued growth. The company also reported positive progress in new product launches and market penetration.
Record total revenue and MACI revenue in the first quarter of 2024
Significant margin expansion and profitability growth
Positive progress in new product launches and market penetration
Adjusted EBITDA growth of 325%
Strong balance sheet with approximately $148 million in cash, restricted cash, and investments, with no debt
Increased operating expenses due to development activities and increased headcount
Net loss of $3.9 million for the quarter
Gross margin of 69%, slightly lower than the target of 70%
Insights
Vericel's reported total revenue growth of 25% to
The company's gross margin has improved to 69%, a sign of cost efficiency and potentially favorable pricing power in their specialized markets. Furthermore, an adjusted EBITDA growth of 325% is a clear indicator of operational excellence and financial health, with an EBITDA margin of 14%. This metric is important as it excludes the non-cash expenses and gives a clearer view of the company's profitability from core operations.
The company's strong cash position of approximately
Raising the full-year 2024 revenue guidance to
Vericel's expansion in the sports medicine and severe burn care markets is particularly noteworthy. The robust growth in the first quarter following new product launches, such as NexoBrid, suggests significant market potential for novel treatments in these areas. As a niche player, Vericel is capitalizing on the specialized demand for advanced therapies, which often face less competition and allow for premium pricing.
The company's update also highlights the strategic focus on research and development, as seen in the investments made in MACI arthroscopic instruments. This indicates a forward-thinking approach in enhancing their product offerings, which is essential in the biotechnology and pharmaceuticals industry where innovation is key to sustaining growth.
From a market penetration perspective, the over 60 Pharmacy and Therapeutics (P&T) committee submissions and the fact that approximately 40 burn centers have approved the use of NexoBrid, with more than 30 centers placing initial orders, suggest a healthy adoption rate and a strong start to the launch campaign. This could be indicative of future revenue streams and market expansion.
Total Revenue Increased
Record First Quarter MACI Revenue of
Adjusted EBITDA Growth of
Full-Year 2024 Revenue Guidance Raised to
Conference Call Today at 8:30am Eastern Time
CAMBRIDGE, Mass., May 08, 2024 (GLOBE NEWSWIRE) -- Vericel Corporation (NASDAQ:VCEL), a leader in advanced therapies for the sports medicine and severe burn care markets, today reported financial results and business highlights for the first quarter ended March 31, 2024.
First Quarter 2024 Financial Highlights
- Total net revenue increased
25% to$51.3 million - MACI® net revenue growth of
18% to$40.2 million - Burn Care net revenue growth of
63% to$11.1 million , consisting of$10.7 million of Epicel® revenue and$0.4 million of NexoBrid® revenue - Gross margin of
69% - Net loss of
$3.9 million , or$0.08 per diluted share - Non-GAAP adjusted EBITDA increased
325% to$7.2 million , representing adjusted EBITDA margin of14% - Operating cash flow of
$7.2 million - As of March 31, 2024, the Company had approximately
$148 million in cash, restricted cash and investments, and no debt
Business Highlights and Updates
- Record first quarter total revenue and MACI revenue, and second highest Epicel quarterly revenue since launch
- Record first quarter gross margin increased more than 400 basis points and adjusted EBITDA margin expanded approximately 1,000 basis points versus prior year
- Second highest number of MACI biopsies and surgeons taking biopsies in a quarter since launch
- NexoBrid launch progressing with more than 60 Pharmacy and Therapeutics (P&T) committee submissions, approximately 40 burn centers obtaining approval and more than 30 centers placing initial orders
“The Company had a very strong start to the year, delivering top-tier revenue growth with significant margin expansion and profitability growth,” said Nick Colangelo, President and CEO of Vericel. “Based on the strength of our core portfolio and the contributions from new product launches, we believe that the Company is very well-positioned for continued high revenue and profit growth in 2024 and beyond.”
2024 Financial Guidance
- Total net revenue for 2024 now expected to be in the range of
$238 t o$242 million , compared to the previous guidance of$237 t o$241 million - Maintaining profitability guidance of gross margin of approximately
70% and adjusted EBITDA margin of approximately20%
First Quarter 2024 Results
Total net revenue for the quarter ended March 31, 2024 increased
Gross profit for the quarter ended March 31, 2024 was
Total operating expenses for the quarter ended March 31, 2024 were
Net loss for the quarter ended March 31, 2024 was
Non-GAAP adjusted EBITDA for the quarter ended March 31, 2024 was
As of March 31, 2024, the Company had approximately
Conference Call Information
Today’s conference call will be available live at 8:30 a.m. Eastern Time and can be accessed through the Investor Relations section of the Vericel website at http://investors.vcel.com/events-presentations. A slide presentation with highlights from today’s conference call will be available on the webcast and in the Investor Relations section of the Vericel website. Please access the site at least 15 minutes prior to the scheduled start time in order to download the required audio software, if necessary. To participate by telephone, please register here to receive dial-in details and your personal passcode. A replay of the webcast will be available on the Vericel website until May 8, 2025.
About Vericel Corporation
Vericel is a leading provider of advanced therapies for the sports medicine and severe burn care markets. The Company combines innovations in biology with medical technologies, resulting in a highly differentiated portfolio of innovative cell therapies and specialty biologics that repair injuries and restore lives. Vericel markets three products in the United States. MACI (autologous cultured chondrocytes on porcine collagen membrane) is an autologous cellularized scaffold product indicated for the repair of symptomatic, single or multiple full-thickness cartilage defects of the knee with or without bone involvement in adults. Epicel (cultured epidermal autografts) is a permanent skin replacement for the treatment of patients with deep dermal or full thickness burns greater than or equal to
GAAP v. Non-GAAP Measures
Vericel’s reported earnings are prepared in accordance with generally accepted accounting principles in the United States, or GAAP, and represent earnings as reported to the Securities and Exchange Commission. Vericel has provided in this release certain financial information that has not been prepared in accordance with GAAP. Vericel’s management believes that the non-GAAP adjusted EBITDA described in this release, which includes adjustments for specific items that are generally not indicative of our core operations, provides additional information that is useful to investors in understanding Vericel’s underlying performance, business and performance trends, and helps facilitate period-to-period comparisons and comparisons of its financial measures with other companies in Vericel’s industry. However, the non-GAAP financial measures that Vericel uses may differ from measures that other companies may use. Non-GAAP financial measures are not required to be uniformly applied, are not audited and should not be considered in isolation or as substitutes for results prepared in accordance with GAAP.
Epicel® and MACI® are registered trademarks of Vericel Corporation. NexoBrid® is a registered trademark of MediWound Ltd. and is used under license to Vericel Corporation. © 2024 Vericel Corporation. All rights reserved.
Forward-Looking Statements
Vericel cautions you that all statements other than statements of historical fact included in this press release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. Although we believe that we have a reasonable basis for the forward-looking statements contained herein, they are based on current expectations about future events affecting us and are subject to risks, assumptions, uncertainties and factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control. Our actual results may differ materially from those expressed or implied by the forward-looking statements in this press release. These statements are often, but are not always, made through the use of words or phrases such as “anticipates,” “intends,” “estimates,” “plans,” “expects,” “continues,” “believe,” “guidance,” “outlook,” “target,” “future,” “potential,” “goals” and similar words or phrases, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may,” or similar expressions.
Among the factors that could cause actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, uncertainties associated with our expectations regarding future revenue, growth in revenue, market penetration for MACI, Epicel, and NexoBrid, growth in profit, gross margins and operating margins, the ability to continue to scale our manufacturing operations to meet the demand for our cell therapy products, including the timely completion of a new headquarters and manufacturing facility in Burlington, Massachusetts, the ability to achieve or sustain profitability, contributions to adjusted EBITDA, the expected target surgeon audience, potential fluctuations in sales and volumes and our results of operations over the course of the year, timing and conduct of clinical trial and product development activities, timing and likelihood of the FDA’s potential approval of the arthroscopic delivery of MACI to the knee or the use of MACI to treat cartilage defects in the ankle, the estimate of the commercial growth potential of our products and product candidates, competitive developments, changes in third-party coverage and reimbursement, physician and burn center adoption of NexoBrid, supply chain disruptions or other events or factors affecting MediWound’s ability to manufacture and supply sufficient quantities of NexoBrid to meet customer demand, including but not limited to the ongoing Israel-Hamas war, negative impacts on the global economy and capital markets resulting from the conflict in Ukraine and the Israel-Hamas war, adverse developments affecting financial institutions, companies in the financial services industry or the financial services industry generally, global geopolitical tensions or record inflation and potential future impacts on our business or the economy generally stemming from a resurgence of COVID-19 or another similar public health emergency.
These and other significant factors are discussed in greater detail in Vericel’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the Securities and Exchange Commission (SEC) on February 29, 2024, Vericel’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, filed with the SEC on May 8, 2024, and in other filings with the SEC. These forward-looking statements reflect our views as of the date hereof and Vericel does not assume and specifically disclaims any obligation to update any of these forward-looking statements to reflect a change in its views or events or circumstances that occur after the date of this release except as required by law.
Investor Contact:
Eric Burns
ir@vcel.com
+1 (734) 418-4411
Media Contact:
Julie Downs
media@vcel.com
| VERICEL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts - unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| 2024 | 2023 | ||||||
| Product sales, net | $ | 51,281 | $ | 41,017 | |||
| Total revenue | 51,281 | 41,017 | |||||
| Cost of product sales | 15,927 | 14,497 | |||||
| Gross profit | 35,354 | 26,520 | |||||
| Research and development | 6,418 | 5,212 | |||||
| Selling, general and administrative | 34,400 | 29,485 | |||||
| Total operating expenses | 40,818 | 34,697 | |||||
| Loss from operations | (5,464 | ) | (8,177 | ) | |||
| Other income (expense): | |||||||
| Interest income | 1,762 | 839 | |||||
| Interest expense | (153 | ) | (145 | ) | |||
| Other expense | (7 | ) | (12 | ) | |||
| Total other income | 1,602 | 682 | |||||
| Net loss | $ | (3,862 | ) | $ | (7,495 | ) | |
| Net loss per common share: | |||||||
| Basic and diluted | $ | (0.08 | ) | $ | (0.16 | ) | |
| Weighted-average common shares outstanding: | |||||||
| Basic and diluted | 48,141 | 47,387 | |||||
| VERICEL CORPORATION RECONCILIATION OF REPORTED NET LOSS (GAAP) TO ADJUSTED EBITDA (NON-GAAP MEASURE) (in thousands - unaudited) | |||||||
| Three Months Ended March 31, | |||||||
| 2024 | 2023 | ||||||
| Net loss | $ | (3,862 | ) | $ | (7,495 | ) | |
| Stock-based compensation expense | 9,834 | 8,731 | |||||
| Depreciation and amortization | 1,378 | 1,158 | |||||
| Net interest income | (1,609 | ) | (694 | ) | |||
| Pre-occupancy lease expense | 1,477 | — | |||||
| Adjusted EBITDA (Non-GAAP) | $ | 7,218 | $ | 1,700 | |||
| VERICEL CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands - unaudited) | |||||||
| March 31, | December 31, | ||||||
| 2024 | 2023 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 62,938 | $ | 69,088 | |||
| Restricted cash | 7,804 | 17,778 | |||||
| Short-term investments | 47,710 | 40,469 | |||||
| Accounts receivable (net of allowance for doubtful accounts of | 49,934 | 58,356 | |||||
| Inventory | 13,557 | 13,087 | |||||
| Other current assets | 7,775 | 6,853 | |||||
| Total current assets | 189,718 | 205,631 | |||||
| Property and equipment, net | 56,392 | 41,635 | |||||
| Intangible assets, net | 6,719 | 6,875 | |||||
| Right-of-use assets | 73,682 | 73,462 | |||||
| Long-term investments | 29,433 | 25,283 | |||||
| Other long-term assets | 717 | 771 | |||||
| Total assets | $ | 356,661 | $ | 353,657 | |||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 19,432 | $ | 22,347 | |||
| Accrued expenses | 11,026 | 17,215 | |||||
| Current portion of operating lease liabilities | 6,012 | 6,187 | |||||
| Total current liabilities | 36,470 | 45,749 | |||||
| Operating lease liabilities | 86,141 | 81,856 | |||||
| Other long-term liabilities | 154 | 100 | |||||
| Total liabilities | $ | 122,765 | $ | 127,705 | |||
| Total shareholders’ equity | 233,896 | 225,952 | |||||
| Total liabilities and shareholders’ equity | $ | 356,661 | $ | 353,657 | |||
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