Xtant Medical Holdings Inc (XTNT) Reports Record Q3 Revenue and Raises 2023 Guidance
Xtant Medical Holdings Inc (XTNT) announced a record third-quarter revenue of $25 million, marking a 73% increase year-over-year.
The company reported a significant turnaround with a net income of $9.2 million in Q3 2023, compared to a net loss of $2.4 million in the same period last year.
Gross margin improved to 61.3% in Q3 2023 from 54.6% in Q3 2022, driven by production efficiencies and a favorable product mix.
XTNT raised its full-year 2023 revenue guidance to $88 million - $91 million, reflecting confidence in continued growth and contributions from recent acquisitions.
On November 9, 2023, Xtant Medical Holdings Inc (XTNT), a leader in surgical solutions for spinal disorders, released its financial results for the third quarter ended September 30, 2023. The company's impressive performance was highlighted by a record third-quarter revenue of $25 million, a substantial 73% increase compared to $14.5 million in the same quarter of the previous year. This growth was driven by an 18% organic growth and a 55% increase from products added through the acquisition of the Coflex and CoFix lines and Surgalign hardware and biologics business.
Financial Highlights and Performance
The company's gross margin saw a notable improvement, rising to 61.3% in the third quarter of 2023 from 54.6% in the corresponding period of 2022. This increase was primarily due to enhanced production efficiencies, reduced charges for excess and obsolete inventory, and a favorable product mix, despite facing higher product costs.
Operating expenses for the third quarter of 2023 totaled $18.7 million, a significant increase from $9.8 million in the third quarter of 2022. The rise in expenses was mainly attributed to additional independent agent sales commissions, higher employee compensation expenses, legal expenses, and amortization of intangible assets associated with the Coflex and CoFix product lines.
XTNT's net income for the third quarter of 2023 was $9.2 million, or $0.07 per share, a remarkable improvement from a net loss of $2.4 million, or $0.03 per share, in the third quarter of 2022. Non-GAAP Adjusted EBITDA for the third quarter of 2023 was $0.5 million, compared to a Non-GAAP Adjusted EBITDA loss of $0.9 million for the prior-year period.
Outlook and Strategic Focus
With the successful integration of Surgalign's hardware and biologics business, XTNT has raised its full-year 2023 revenue guidance to between $88 million and $91 million, up from the previous forecast of $75 million to $77 million. This revised guidance represents an anticipated annual revenue growth of approximately 52% to 57% compared to full-year 2022 revenue, including contributions from the Surgalign transaction.
Sean Browne, President and CEO of Xtant Medical, expressed pride in the team's efforts and the company's execution, stating,
With the Surgalign integration progressing smoothly, we remain focused on optimizing our distribution network and further scaling operations. We look forward to building upon this momentum by bringing expanded solutions to patients in need and maximizing value to our shareholders."
XTNT will host a webcast and conference call to discuss the third-quarter 2023 financial results, providing an opportunity for investors to gain further insights into the company's performance and future prospects.
Balance Sheet and Cash Flow
As of September 30, 2023, XTNT's balance sheet reflected total assets of $92 million, with current assets accounting for $64.1 million. The company's total liabilities stood at $37.3 million, with stockholders' equity at $54.7 million. During the nine months ended September 30, 2023, net cash used in operating activities amounted to $8.6 million, while net cash used in investing activities totaled $22.5 million, primarily due to the acquisition of Surgalign SPV, Inc. and Surgalign Holdings, Inc.'s hardware and biologics business.
XTNT's financial results demonstrate a strong performance in the third quarter, with significant revenue growth and a return to profitability. The company's strategic acquisitions and operational efficiencies have contributed to its success, and the raised guidance for 2023 indicates a positive outlook for continued growth.
Explore the complete 8-K earnings release (here) from Xtant Medical Holdings Inc for further details.
This article first appeared on GuruFocus.
