Full Press Release Details
MIMEDX Announces First Quarter 2024 Operating and Financial
$85 Million Grew 18% Year-Over-Year for the First Quarter
First Quarter GAAP Net Income was $9 Million
First Quarter Adjusted EBITDA of $19 Million, or 22% of Net Sales
Management to Host Conference Call Today, April 30, 2024, at 4:30 PM ET
MARIETTA, Ga., April 30, 2024 MiMedx Group, Inc. (Nasdaq: MDXG) ( MIMEDX or the Company ), today
announced operating and financial results for the first quarter 2024.
Recent Operating and Financial Highlights:
Joseph H. Capper, MIMEDX Chief Executive Officer, commented, Our first quarter 2024 results represent
another stellar period for MIMEDX, with significant accomplishments across the organization that underscore our success executing on our major strategic priorities. Net sales growth was robust once again, achieving an 18% increase year-over-year. In
addition, we expanded our portfolio in the first quarter to include a xenograft product that we see as a strategic fit and plan to launch later this year. Finally, we continued to apply disciplined expense management in the first quarter, resulting
in an Adjusted EBITDA margin of 22%.
Mr. Capper continued, We believe the clinical strength of our product portfolio, effectiveness of
our commercial organization, solid financial foundation, and the pending launch of our xenograft product into the Surgical market position MIMEDX well for another successful year and long-term growth.
| Three Months Ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net Income (loss) | $ | 9,261 | $ | (4,983 | ) | |||
| Non-GAAP Adjustments: | ||||||||
| Depreciation expense | 558 | 714 | ||||||
| Amortization of intangible assets | 189 | 190 | ||||||
| Interest expense, net | 1,690 | 1,553 | ||||||
| Income tax provision (benefit) expense | 2,348 | 51 | ||||||
| Share-based compensation | 4,340 | 4,345 | ||||||
| Investigation, restatement and related expenses | 311 | 3,673 | ||||||
| Strategic and other expenses | 168 | |||||||
| Expenses related to disbanding of Regenerative Medicine business unit | (200 | ) | ||||||
| Adjusted EBITDA | $ | 18,665 | $ | 5,543 | ||||
| Adjusted EBITDA margin | 22.0 | % | 7.7 | % |
First Quarter 2024 Results Discussion1
MIMEDX reported net sales for the three months
ended March 31, 2024, of $85 million, compared to $72 million for the three months ended March 31, 2023, an increase of 18%. Net sales growth came from solid contributions in both the Wound & Surgical end markets and
across each of our main sites of service.
Gross Profit and Margin
Gross profit for the three months ended March 31, 2024, was $72 million, an increase of $12 million as compared to the prior year period. Gross
margin for the three months ended March 31, 2024 was 84.7%, compared to 82.7% in the prior year period. The year-over-year improvement in gross margin was driven by favorable product mix and our continued execution on yield improvement
Selling, general and
administrative ( SG&A ) expenses for the three months ended March 31, 2024, were $55 million compared to $52 million for the three months ended March 31, 2023. SG&A expense during the first quarter 2024 included
increased sales commissions due to higher sales volumes.
Research and development expenses were $3 million for each of the three months ended
March 31, 2024 and March 31, 2023.
Investigation, restatement and related expense was immaterial for the three months ended March 31, 2024
compared to $4 million for the three months ended March 31, 2023. The decrease was related to negotiated reductions in legal fees previously incurred. In addition, following the end of a legal proceeding, expenses under our last material
proceeding involving indemnification of former officers and directors substantially ceased in 2023.
Net income from continuing operations for the three
months ended March 31, 2024 was $9 million compared to a net loss from continuing operations of $2 million for the three months ended March 31, 2023.
Cash and Cash Equivalents
As of March 31, 2024, the
Company had $48 million of cash and cash equivalents compared to $82 million as of December 31, 2023. The decrease during the period ended March 31, 2024 was primarily a result of our repaying the $30 million outstanding
balance on our revolving credit facility during the first quarter, as well as the $5 million cash payment associated with our agreement with TELA Bio, Inc., paving the way for our exclusive manufacturing and supply agreement with Regenity
Conference Call and Webcast
MIMEDX will host a conference call and webcast to review its first quarter 2024 results on Tuesday, April 30, 2024, beginning at 4:30 p.m., Eastern Time.
The call can be accessed using the following information:
U.S. Investors: 877-407-6184
International Investors: 201-389-0877
Conference ID: 13745475
A replay of the webcast will be
available for approximately 30 days on the Company s website at www.mimedx.com following the conclusion of the event.
Important Cautionary
This press release includes forward-looking statements. Statements regarding: (i) future sales or sales growth; (ii) our 2024
financial goals and expectations for future financial results, including levels of net sales, Adjusted EBITDA, and Adjusted EBITDA margin; (iii) our cash flows; (iv)our expectations regarding the use of our products, including EPIEFFECT and
AMNIOEFFECT; (v) our expectations regarding the launch of our collagen particulate xenograft product; and (v) continued growth in different care settings. Additional forward-looking statements may be identified by words such as
believe, expect, may, plan, goal, outlook, potential, will, preliminary, and similar expressions, and are based on management s current
beliefs and expectations.
Forward-looking statements are subject to risks and uncertainties, and the Company cautions investors against placing undue
reliance on such statements. Actual results may differ materially from those set forth in the forward-looking statements. Factors that could cause actual results to differ from expectations include: (i) future sales are uncertain and are
affected by competition, access to customers, patient access to healthcare providers, the reimbursement environment and many other factors; (ii) the Company may change its plans due to unforeseen circumstances; (iii) the results of
scientific research are uncertain and may have little or no value; (iv) our ability to sell our products in other countries depends on a number of factors including adequate levels of reimbursement, market acceptance of novel therapies, and our
ability to build and manage a direct sales force or third party distribution relationship; (v) the effectiveness of amniotic tissue as a therapy for particular indications or conditions is the subject of further scientific and clinical studies;
and (vi) we may alter the timing and amount of planned expenditures for research and development based on regulatory developments. The Company describes additional risks and uncertainties in the Risk Factors section of its most recent annual
report and quarterly reports filed with the Securities and Exchange Commission. Any forward-looking statements speak only as of the date of this press release and the Company assumes no obligation to update any forward-looking statement.
MIMEDX is a pioneer and leader focused on helping humans heal. With more than a decade of helping clinicians manage chronic and other hard-to-heal wounds, MIMEDX is dedicated to providing a leading portfolio of products for applications in the wound care, burn, and surgical sectors of healthcare. The
Company s vision is to be the leading global provider of healing solutions through relentless innovation to restore quality of life. For additional information, please visit www.mimedx.com.
Selected Unaudited Financial
Condensed Consolidated Balance Sheets
(in thousands) Unaudited
| March 31, 2024 | December 31, 2023 | |||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 48,487 | $ | 82,000 | ||||
| Accounts receivable, net | 57,016 | 53,871 | ||||||
| Inventory | 24,454 | 21,021 | ||||||
| Prepaid expenses | 6,095 | 5,624 | ||||||
| Other current assets | 2,801 | 1,745 | ||||||
| Total current assets | 138,853 | 164,261 | ||||||
| Property and equipment, net | 7,340 | 6,974 | ||||||
| Right of use asset | 3,499 | 2,132 | ||||||
| Deferred tax asset, net | 38,747 | 40,777 | ||||||
| Goodwill | 19,441 | 19,441 | ||||||
| Intangible assets, net | 12,550 | 5,257 | ||||||
| Other assets | 1,251 | 205 | ||||||
| Total assets | $ | 221,681 | $ | 239,047 | ||||
| LIABILITIES AND STOCKHOLDERS EQUITY | ||||||||
| Current liabilities: | ||||||||
| Current portion of long term debt | $ | 1,000 | $ | 1,000 | ||||
| Accounts payable | 9,697 | 9,048 | ||||||
| Accrued compensation | 17,913 | 22,353 | ||||||
| Accrued expenses | 9,196 | 9,361 | ||||||
| Current liabilities of discontinued operations | 344 | 1,352 | ||||||
| Other current liabilities | 4,071 | 2,894 | ||||||
| Total current liabilities | 42,221 | 46,008 | ||||||
| Long term debt, net | 18,453 | 48,099 | ||||||
| Other liabilities | 5,276 | 2,223 | ||||||
| Total liabilities | 65,950 | 96,330 | ||||||
| Total stockholders equity | 155,731 | 142,717 | ||||||
| Total liabilities and stockholders equity | $ | 221,681 | $ | 239,047 |
Condensed Consolidated Statements of Operations
(in thousands, except share and per share amounts) Unaudited
| Three Months Ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net sales | $ | 84,709 | $ | 71,676 | ||||
| Cost of sales | 12,987 | 12,419 | ||||||
| Gross profit | 71,722 | 59,257 | ||||||
| Operating expenses: | ||||||||
| Selling, general and administrative | 55,129 | 52,250 | ||||||
| Research and development | 2,841 | 3,484 | ||||||
| Investigation, restatement and related | 311 | 3,673 | ||||||
| Amortization of intangible assets | 189 | 190 | ||||||
| Impairment of intangible assets | 54 | |||||||
| Operating income (loss) | 13,198 | (340 | ) | |||||
| Other expense, net | ||||||||
| Interest expense, net | (1,690 | ) | (1,553 | ) | ||||
| Other (expense) income, net | (99 | ) | 2 | |||||
| Income (loss) from continuing operations before income tax | 11,409 | (1,891 | ) | |||||
| Income tax expense from continuing operations | (2,348 | ) | (51 | ) | ||||
| Net income (loss) from continuing operations | 9,061 | (1,942 | ) | |||||
| Income (loss) from discontinued operations, net of tax | 200 | (3,041 | ) | |||||
| Net income (loss) | $ | 9,261 | $ | (4,983 | ) | |||
| Net income (loss) from continuing operations available to common stockholders | $ | 9,061 | $ | (3,626 | ) | |||
| Basic net income (loss) per common share: | ||||||||
| Continuing operations | $ | 0.06 | $ | (0.03 | ) | |||
| Discontinued operations | 0.00 | (0.03 | ) | |||||
| Basic net income (loss) per common share | $ | 0.06 | $ | (0.06 | ) | |||
| Diluted net income (loss) per common share: | ||||||||
| Continuing operations | $ | 0.06 | $ | (0.03 | ) | |||
| Discontinued operations | 0.00 | (0.03 | ) | |||||
| Diluted net income (loss) per common share | $ | 0.06 | $ | (0.06 | ) | |||
| Weighted average common shares outstanding - basic | 146,404,587 | 114,398,813 | ||||||
| Weighted average common shares outstanding - diluted | 150,028,107 | 114,398,813 |
Condensed Consolidated Statements of Cash Flows
(in thousands) Unaudited
| Three Months Ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net cash flows provided by (used in) operating activities | 5,978 | (4,048 | ) | |||||
| Net cash flows used in investing activities | (6,024 | ) | (677 | ) | ||||
| Net cash flows used in financing activities | (33,467 | ) | (4 | ) | ||||
| Net change in cash | $ | (33,513 | ) | $ | (4,729 | ) |
Reconciliation of Non-GAAP Measures
In addition to our GAAP results, we provide certain non-GAAP metrics including Adjusted EBITDA, related margins, Free
Cash Flow, Adjusted Net Income, and Adjusted Earnings Per Share ( Adjusted EPS ). We believe that the presentation of these measures provides important supplemental information to management and investors regarding our performance. These
measurements are not a substitute for GAAP measurements. Company management uses these non-GAAP measurements as aids in monitoring our ongoing financial performance from quarter-to-quarter and year-to-year on a regular basis and for benchmarking against comparable companies.
These non-GAAP financial measures reflect the exclusion of the following items:
Adjusted EBITDA and Adjusted EBITDA margin
Adjusted EBITDA consists of GAAP net income (loss) excluding: (i) depreciation, (ii) amortization of intangibles, (iii) interest expense, net,
(iv) income tax provision, (v) investigation, restatement and related expenses, (vi) reorganization expenses related to severance charges for certain officers and employees (vii) expenses related to disbanding of the Regenerative
Medicine business unit and (viii) share-based compensation.
Please refer to the tables at the beginning of this press release for reconciliation to
GAAP net income (loss).
Adjusted Net Income (Loss)
Adjusted Net Income (Loss) provides a view of our operating performance, exclusive of certain items which are
non-recurring or not reflective of our core operations.
Adjusted Net Income is defined as GAAP net income (loss)
plus (i) loss on extinguishment of debt (ii) investigation restatement and related expenses, (iii) expenses related to disbanding of our Regenerative Medicine business unit, (iv) strategic and other expenses, and (v) the
long-term effective income tax rate adjustment.
A reconciliation of GAAP Net Income (Loss) to Adjusted Net Income appears in the table below (in
| Three Months Ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net income (loss) | $ | 9,261 | $ | (4,983 | ) | |||
| Loss on extinguishment of debt | 1,401 | |||||||
| Investigation, restatement and related expenses | 311 | 3,673 | ||||||
| Strategic and other expenses | 168 | |||||||
| Expenses related to disbanding of Regenerative Medicine business unit | (200 | ) | ||||||
| Long-term effective income tax rate adjustment | (974 | ) | 366 | |||||
| Adjusted net income (loss) | $ | 9,967 | $ | (944 | ) |
Adjusted Earnings Per Share
Adjusted Earnings Per Share is intended to provide a normalized view of earnings per share by removing items that may be irregular, one-time, or non-recurring from net income. This enables us to identify underlying trends in our business that could otherwise be masked by such items. Adjusted Earnings Per
Share consists of GAAP diluted earnings per share including adjustments for: (i) effects of antidilution, (ii) investigation, restatement and related expenses, (iii) reorganization expenses related to severance charges for certain
officers and employees and (iv) long-term adjusted effective income tax rate.
A reconciliation of GAAP diluted earnings per share to Adjusted
Earnings Per Share appears in the table below (per diluted share):
| Three Months Ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| GAAP net income (loss) per common share - diluted | $ | 0.06 | $ | (0.06 | ) | |||
| Loss on extinguishment of debt | 0.01 | 0.00 | ||||||
| Investigation, restatement and related (benefit) expense | 0.00 | 0.03 | ||||||
| Strategic and other expenses | 0.00 | 0.00 | ||||||
| Expenses related to disbanding of Regenerative Medicine business unit | 0.00 | 0.00 | ||||||
| Long-term effective income tax rate adjustment | 0.00 | 0.00 | ||||||
| Adjusted Earnings Per Share | $ | 0.07 | $ | (0.03 | ) | |||
| Weighted average common shares outstanding - adjusted | 150,028,107 | 114,398,813 |
Flow is intended to provide a measure of our ability to generate cash in excess of capital investments. It provides management with a view of cash flows which can be used to finance operational and strategic investments.
Free Cash Flow is defined as net cash provided by (used in) operating activities less capital expenditures, including purchases of equipment.
A reconciliation of GAAP net cash flows provided by (used in) operating activities to Free Cash Flow appears in the table below (in thousands):
| Three Months Ended March 31, | ||||||||
| 2024 | 2023 | |||||||
| Net cash flows provided by (used in) operating activities | 5,978 | (4,048 | ) | |||||
| Capital expenditures, including purchases of equipment | (1,144 | ) | (633 | ) | ||||
| Free Cash Flow | $ | 4,834 | $ | (4,681 | ) |