LeMaitre Q4 2022 Financial Results

LeMaitre Vascular, Inc.

BURLINGTON, Mass., Feb. 23, 2023 (GLOBE NEWSWIRE) -- LeMaitre (Nasdaq:LMAT), a provider of vascular devices, implants and services, today reported Q4 2022 results, announced a $0.14/share quarterly dividend (+12%) and provided guidance.

Q4 2022 Financial Results

• Sales $41.0mm, +4% (+8% organic) vs. Q4 2021

• Op. income $7.0mm, -16%

• Op. margin 17%

• Net income $5.6mm, -9%

• Earnings per diluted share $0.25, -9%

• Cash and investments +$3.0mm to $82.7mm

Bovine patches (+11%), carotid shunts (+24%) and bovine grafts (+11%) drove sales growth in Q4 2022. Organic sales increased 22% in APAC, 9% in EMEA and 6% in the Americas. APAC and EMEA each reported record sales.

The gross margin decreased to 63.6% in Q4 2022 (vs. 65.7% in Q4 2021), with the strong dollar accounting for 150 basis points of this decline. 219 direct labor employees were on staff at year-end, up 54%.

Operating income declined 16% to $7.0mm in Q4 2022. Operating expenses grew 8%, driven by a 27% increase in sales representatives to 131.

George LeMaitre, Chairman and CEO, said “In Q4 we grew sales 8% organically and our guidance for Q1 is 11% on a reported basis and 13% organically. Our two key 2022 initiatives - the Burlington factory expansion and the rep surge - should drive improved top- and bottom-line results in 2023.”

Business Outlook

	Q1 2023 Guidance	2023 Full Year Guidance
Sales	$42.6mm - $45.0mm (Mid: $43.8mm, +11%, +13% Org.)	$174.3mm - $178.3mm (Mid: $176.3mm, +9%, +9% Org.)
Gross Margin	64.8%	65.4%
Op. Income	$6.0mm - $7.5mm (Mid: $6.7mm, -15%)	$30.6mm - $33.3mm (Mid: $31.9mm, +19%, +7% Ex. Special)
EPS	$0.22 - $0.27 (Mid: $0.25, -10%)	$1.11 - $1.20 (Mid: $1.16, +24%, +8% Ex. Special)

Quarterly Dividend

On February 21, 2023, the Company's Board of Directors approved a quarterly dividend of $0.14/share of common stock. The dividend will be paid on March 23, 2023 to shareholders of record on March 9, 2023.

Share Repurchase Program

On February 21, 2023, the Company's Board of Directors authorized the repurchase of up to $25.0mm of the Company’s common stock. The repurchase program may be suspended or discontinued at any time and will conclude on February 21, 2024, 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, and have provided guidance for operating income and EPS excluding the special charge relating to the closure of our St. Etienne factory. 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, factory closures, 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 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)
		December 31, 2022				December 31, 2021
		(unaudited)
Assets
Current assets:
Cash and cash equivalents		$	19,134			$	13,855
Short-term marketable securities			63,557				56,104
Accounts receivable, net			22,040				19,631
Inventory and other deferred costs			50,271				46,104
Prepaid expenses and other current assets			6,731				4,189
Total current assets			161,733				139,883
Property and equipment, net			17,901				17,059
Right-of-use leased assets			15,634				15,071
Goodwill			65,945				65,945
Other intangibles, net			46,527				52,710
Deferred tax assets			1,745				1,566
Other assets			991				568
Total assets		$	310,476			$	292,802
Liabilities and stockholders' equity
Current liabilities:
Accounts payable		$	2,903			$	2,340
Accrued expenses			19,967				16,332
Acquisition-related obligations			573				1,271
Lease liabilities - short-term			1,886				1,870
Total current liabilities			25,329				21,813
Lease liabilities - long-term			14,710				14,067
Deferred tax liabilities			69				70
Other long-term liabilities			2,167				2,701
Total liabilities			42,275				38,651
Stockholders' equity
Common stock			237				235
Additional paid-in capital			189,268				181,630
Retained earnings			97,773				88,125
Accumulated other comprehensive loss			(6,031	)			(3,435	)
Treasury stock			(13,046	)			(12,404	)
Total stockholders' equity			268,201				254,151
Total liabilities and stockholders' equity		$	310,476			$	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 year ended
	December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Net sales	$	40,954			$	39,503			$	161,651			$	154,424
Cost of sales		14,900				13,547				56,755				53,042
Gross profit		26,054				25,956				104,896				101,382
Operating expenses:
Sales and marketing		8,600				7,445				32,921				27,655
General and administrative		6,933				6,753				28,745				25,501
Research and development		3,554				3,457				13,294				11,801
Restructuring		-				-				3,107				-
Total operating expenses		19,087				17,655				78,067				64,957
Income from operations		6,967				8,301				26,829				36,425
Other income (expense), net
Interest income		447				141				986				197
Interest expense		-				(526	)			-				(2,219	)
Other income (loss), net		384				(11	)			(325	)			(116	)
Income before income taxes		7,798				7,905				27,490				34,287
Provision for income taxes		2,171				1,730				6,854				7,380
Net income	$	5,627			$	6,175			$	20,636			$	26,907
Earnings per share of common stock
Basic	$	0.26			$	0.28			$	0.94			$	1.27
Diluted	$	0.25			$	0.28			$	0.93			$	1.25
Weighted - average shares outstanding:
Basic		22,023				21,860				21,975				21,157
Diluted		22,238				22,138				22,171				21,475
Cash dividends declared per common share	$	0.125			$	0.110			$	0.500			$	0.440

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)
SELECTED NET SALES INFORMATION
(amounts in thousands)
(unaudited)
	For the three months ended																For the year ended
	December 31, 2022								December 31, 2021								December 31, 2022								December 31, 2021
	$				%				$				%				$				%				$				%
Net Sales by Geography
Americas	$	27,415				67	%		$	25,948				65	%		$	109,439				68	%		$	102,265				66	%
Europe, Middle East and Africa		10,689				26	%			10,932				28	%			41,854				26	%			42,132				27	%
Asia Pacific		2,850				7	%			2,623				7	%			10,358				6	%			10,027				7	%
Total Net Sales	$	40,954				100	%		$	39,503				100	%		$	161,651				100	%		$	154,424				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, 2022
Net sales as reported		$	40,954
Impact of currency exchange rate fluctuations			1,737
Adjusted net sales						$	42,691
For the three months ended December 31, 2021
Net sales as reported		$	39,503
Adjusted net sales						$	39,503
Adjusted net sales increase for the three months ended December 31, 2022						$	3,188				8	%
APAC sales growth reconciliation between GAAP and Non-GAAP:
For the three months ended December 31, 2022
Net sales as reported		$	2,850
Impact of currency exchange rate fluctuations			350
APAC adjusted net sales						$	3,200
For the three months ended December 31, 2021
Net sales as reported		$	2,623
Adjusted net sales						$	2,623
APAC adjusted net sales increase for the three months ended December 31, 2022						$	577				22	%
EMEA sales growth reconciliation between GAAP and Non-GAAP:
For the three months ended December 31, 2022
Net sales as reported		$	10,689
Impact of currency exchange rate fluctuations			1,215
EMEA adjusted net sales						$	11,904
For the three months ended December 31, 2021
Net sales as reported		$	10,932
Adjusted net sales						$	10,932
EMEA adjusted net sales increase for the three months ended December 31, 2022						$	972				9	%
Americas sales growth reconciliation between GAAP and Non-GAAP:
For the three months ended December 31, 2022
Net sales as reported		$	27,415
Impact of currency exchange rate fluctuations			172
Americas adjusted net sales						$	27,587
For the three months ended December 31, 2021
Net sales as reported		$	25,948
Adjusted net sales						$	25,948
Americas adjusted net sales increase for the three months ended December 31, 2022						$	1,639				6	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
For the three months ending March 31, 2023
Net sales per guidance (midpoint)		$	43,849
Impact of currency exchange rate fluctuations			1,049
Adjusted projected net sales						$	44,898
For the three months ended March 31, 2022
Net sales as reported		$	39,561
Adjusted net sales						$	39,561
Adjusted projected net sales increase for the three months ending March 31, 2023						$	5,337				13	%
Reconciliation between GAAP and Non-GAAP projected sales growth:
For the year ending December 31, 2023
Net sales per guidance (midpoint)		$	176,349
Impact of currency exchange rate fluctuations			320
Adjusted projected net sales						$	176,669
For the year ended December 31, 2022
Net sales as reported		$	161,651
Adjusted net sales						$	161,651
Adjusted projected net sales increase for the year ending December 31, 2023						$	15,018				9	%
Reconciliation between GAAP and Non-GAAP projected operating income
For the year ending December 31, 2023
Operating income per guidance (midpoint)		$	31,950
Adjusted operating income						$	31,950
For the year ended December 31, 2022
Operating income as reported		$	26,829
Impact of special charge			3,107
Adjusted operating income						$	29,936
Adjusted projected operating income increase for the year ending December 31, 2023						$	2,014				7	%
Reconciliation between GAAP and Non-GAAP projected EPS
For the year ending December 31, 2023
EPS per guidance (midpoint)		$	1.16
Adjusted EPS						$	1.16
For the year ended December 31, 2022
EPS as reported		$	0.93
Impact of special charge			0.14
Adjusted EPS						$	1.07
Adjusted projected EPS increase for the year ending December 31, 2023						$	0.09				8	%

LEMAITRE VASCULAR, INC. (NASDAQ: LMAT)
NON-GAAP FINANCIAL MEASURES
(amounts in thousands)
(unaudited)
		For the three months ended								For the year ended
		December 31, 2022				December 31, 2021				December 31, 2022				December 31, 2021
Reconciliation between GAAP and Non-GAAP EBITDA
Net income as reported		$	5,627			$	6,175			$	20,636			$	26,907
Interest (income) expense, net			(447	)			385				(986	)			2,022
Amortization and depreciation expense			2,288				2,359				9,433				9,475
Provision for income taxes			2,171				1,730				6,854				7,380
EBITDA		$	9,639			$	10,649			$	35,937			$	45,784
EBITDA percentage increase (decrease)							-9	%							-22	%