LeMaitre Vascular : Q4 2021 Financial Results - Form 8-K

LeMaitre Q4 2021 Financial Results

BURLINGTON, MA, February 24, 2022 - LeMaitre (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q4 2021 results, announced a $0.125/share quarterly dividend (+14%) and provided guidance.

Q4 2021 Financial Results

●

Sales of $39.5mm, +5% (+6% organic) vs. Q4 2020

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Op. income of $8.3mm, -13%

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Op. margin of 21%

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Net income of $6.2mm, -12%

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Earnings of $0.28 per diluted share, -18%

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Cash and investments +$2.9mm to $70.0mm

Q4 2021 sales were driven by bovine grafts (Artegraft) and bovine patches (XenoSure). The Americas was up 8%, EMEA was up 1%, and Asia/Pac was down 3%.

The gross margin increase to 65.7% (vs. 65.0% in Q4 2020) was driven by higher average selling prices and an improved sales mix.

Op. income decreased 13% to $8.3mm in Q4 2021, driven by a 17% headcount increase as well as higher clinical and regulatory expenses.

George LeMaitre, Chairman and CEO, said, "Despite considerable hiring we produced a Q4 op. margin of 21% and the dividend is now increasing for the 11th straight year."

2021 Financial Results

Sales growth of 19% for full-year 2021 was driven by bovine grafts, valvulotomes, bovine patches and carotid shunts. Op. income and net income both grew 27% in 2021 as sales growth outpaced op. expense growth. 2021 EBITDA of $45.8mm coupled with the follow-on stock offering enabled the final Artegraft acquisition loan pay-down during the year and a record cash balance of $70.0mm at year-end.

Business Outlook

	Q1 2022 Guidance
Sales	$37.7mm - $39.7mm (Mid: $38.7mm, +8%, +10% Org.)
Gross Margin	66.2%
Op. Income	$7.1mm - $8.4mm (Mid: $7.7mm, -3%)
EPS	$0.26 - $0.30 (Mid: $0.28, -1%)
	2022 Full Year Guidance
Sales	$162mm - $166mm (Mid: $164mm, +6%, +8% Org.)
Gross Margin	67.2%
Op. Income	$38.5mm - $41.1mm (Mid: $39.8mm, +9%)
EPS	$1.35 - $1.45 (Mid: $1.40, +12%)

Quarterly Dividend

On February 22, 2022, the Company's Board of Directors approved a quarterly dividend of $0.125/share of common stock. The dividend will be paid on March 24, 2022 to shareholders of record on March 8, 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. The conference call may also be accessed by dialing 800-773-2954 ([phone] for international callers), using passcode 50283055. 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.

AboutLeMaitre

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-term 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 EBITDA or earnings before interest, taxes, depreciation and amortization. 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 EBITDA 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 evaluating EBITDA provides an approximation of the cash generating ability of its operations.

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 foreign regulatory requirements to market and sell our products outside the United States; 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
[e-mail]

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)

CONDENSED CONSOLIDATED BALANCE SHEETS

(amounts in thousands)

		December 31, 2021			December 31, 2020
		(unaudited)
Assets
Current assets:
Cash and cash equivalents		$	13,855			$	26,764
Short-term marketable securities			56,104				214
Accounts receivable, net			19,631				19,552
Inventory and other deferred costs			46,104				45,115
Prepaid expenses and other current assets			4,189				2,618
Total current assets			139,883				94,263
Property and equipment, net			17,059				15,036
Right-of-use leased assets			15,071				16,066
Goodwill			65,945				65,945
Other intangibles, net			52,710				58,905
Deferred tax assets			1,566				1,686
Other assets			568				909
Total assets		$	292,802			$	252,810
Liabilities and stockholders' equity
Current liabilities:
Current portion of long-term debt		$	-			$	2,500
Accounts payable			2,340				2,394
Accrued expenses			16,332				17,525
Acquisition-related obligations			1,271				772
Lease liabilities - short-term			1,870				1,954
Total current liabilities			21,813				25,145
Long-term debt, net			-				35,532
Lease liabilities - long-term			14,067				14,791
Deferred tax liabilities			70				127
Other long-term liabilities			2,701				4,643
Total liabilities			38,651				80,238
Stockholders' equity
Common stock			235				221
Additional paid-in capital			181,630				114,924
Retained earnings			88,125				70,554
Accumulated other comprehensive loss			(3,435	)			(1,525	)
Treasury stock			(12,404	)			(11,602	)
Total stockholders' equity			254,151				172,572
Total liabilities and stockholders' equity		$	292,802			$	252,810

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 year ended
		December 31, 2021			December 31, 2020			December 31, 2021			December 31, 2020
Net sales		$	39,503			$	37,548			$	154,424			$	129,366
Cost of sales			13,547				13,146				53,042				44,748
Gross profit			25,956				24,402				101,382				84,618
Operating expenses:
Sales and marketing			7,445				5,912				27,655				23,700
General and administrative			6,753				6,076				25,501				22,501
Research and development			3,457				2,869				11,801				10,099
Gain on sale of building			-				-				-				(470	)
Total operating expenses			17,655				14,857				64,957				55,830
Income from operations			8,301				9,545				36,425				28,788
Other income (expense), net
Interest income			141				13				197				207
Interest expense			(526	)			(579	)			(2,219	)			(1,310	)
Foreign currency gain (loss)			(11	)			(48	)			(116	)			(329	)
Income before income taxes			7,905				8,931				34,287				27,356
Provision for income taxes			1,730				1,898				7,380				6,136
Net income		$	6,175			$	7,033			$	26,907			$	21,220
Earnings per share of common stock
Basic		$	0.28			$	0.35			$	1.27			$	1.05
Diluted		$	0.28			$	0.34			$	1.25			$	1.04
Weighted - average shares outstanding:
Basic			21,860				20,380				21,157				20,246
Diluted			22,138				20,621				21,475				20,479
Cash dividends declared per common share		$	0.110			$	0.095			$	0.440			$	0.380

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)

SELECTED NET SALES INFORMATION

(amounts in thousands)

(unaudited)

		For the three months ended			For the year ended
		December 31, 2021			December 31, 2020			December 31, 2021			December 31, 2020
			$			%				$			%				$			%				$			%
Net Sales by Geography
Americas		$	25,948				65	%		$	24,002				64	%		$	102,265				66	%		$	81,470				63	%
Europe, Middle East and Africa			10,932				28	%			10,854				29	%			42,132				27	%			39,193				30	%
Asia Pacific			2,623				7	%			2,692				7	%			10,027				7	%			8,703				7	%
Total Net Sales		$	39,503				100	%		$	37,548				100	%		$	154,424				100	%		$	129,366				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 December 31, 2021
Net sales as reported		$	39,503
Impact of currency exchange rate fluctuations			372
Adjusted net sales						$	39,875
For the three months ended December 31, 2020
Net sales as reported		$	37,548
Adjusted net sales						$	37,548
Adjusted net sales increase for the three months ended December 31, 2021			$	2,327				6	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
For the three months ending March 31, 2022
Net sales per guidance (midpoint)		$	38,740
Impact of currency exchange rate fluctuations			722
Adjusted projected net sales						$	39,462
For the three months ended March 31, 2021
Net sales as reported		$	35,883
Adjusted net sales						$	35,883
Adjusted projected net sales increase for the three months ending March 31, 2022			$	3,579				10	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
For the year ending December 31, 2022
Net sales per guidance (midpoint)		$	163,990
Impact of currency exchange rate fluctuations			2,018
Adjusted projected net sales						$	166,008
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			$	11,584				8	%

		For the year ended
		December 31, 2021			December 31, 2020
Reconciliation between GAAP and Non-GAAP EBITDA
Net income as reported		$	26,907			$	21,220
Interest (income) expense, net			2,022				1,103
Amortization and depreciation expense			9,475				8,224
Provision for income taxes			7,380				6,136
EBITDA		$	45,784			$	36,683
EBITDA percentage increase (decrease)							25	%