8-K
Angiodynamics Inc (ANGO)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 4, 2024
AngioDynamics, Inc.
(Exact Name of Registrant as Specified in Charter)
| Delaware | 000-50761 | 11-3146460 |
|---|---|---|
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
| 14 Plaza Drive, Latham, New York | 12110 | |
| --- | --- | |
| (Address of Principal Executive Offices) | (Zip Code) |
(518) 795-1400
| (Registrant’s telephone number, including area code) |
|---|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2 (b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $0.01 per share | ANGO | NASDAQ Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 – Results of Operations and Financial Condition.
On April 4, 2024, AngioDynamics issued a press release announcing financial results for the fiscal third quarter ended February 29, 2024. A copy of the press release is furnished herewith as Exhibit 99.1.
The information set forth in Item 2.02 of this Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section. Furthermore, such information shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 7.01 – Regulation FD Disclosure.
Presentation slides discussing AngioDynamics and its fiscal third quarter ended February 29, 2024 are furnished herewith as Exhibit 99.2.
The presentation slides furnished pursuant to Item 7.01 of this Form 8-K (including Exhibit 99.2) shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section. Furthermore, the presentation slides shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act.
Forward-Looking Statements
This document and its attachments contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include the words such as “expects,” “reaffirms,” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “projects”, “optimistic,” or variations of such words and similar expressions, are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ materially from AngioDynamics’ expectations, expressed or implied. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the scale and scope of the COVID-19 global pandemic, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics’ technology or assertions that AngioDynamics’ technology infringes the technology of third parties, the ability of AngioDynamics to effectively compete against competitors that have substantially greater resources, future actions by the FDA or other regulatory agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic conditions (including inflation, labor shortages and supply chain challenges including the cost and availability of raw materials), the results of on-going litigation, challenges with respect to third-party distributors or joint venture partners or collaborators, the results of sales efforts, the effects of product recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic, credit and capital market conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to obtain regulatory clearances or approval of its products, or to integrate acquired businesses, as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2023. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason.
Item 9.01 – Financial Statements and Exhibits.
(d)
Exhibits.
| Exhibit No. | Description |
|---|---|
| 99.1 | Press Release, dated April 4, 2024. |
| 99.2 | Presentation, dated April 4, 2024. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ANGIODYNAMICS, INC. | |||
|---|---|---|---|
| (Registrant) | |||
| Date: April 4, 2024 | By: | /s/ Stephen A. Trowbridge | |
| Name: | Stephen A. Trowbridge | ||
| Title: | Executive Vice President and | ||
| Chief Financial Officer |
Exhibit 99.1
PRESS RELEASE
Investor Contact:
AngioDynamics, Inc.
Stephen Trowbridge, Executive Vice President & CFO
(518) 795-1408
AngioDynamics Reports Fiscal Year 2024 Third Quarter Financial Results;
Updates Fiscal Year 2024 Guidance to Reflect Asset Divestiture
Fiscal Year 2024 Third Quarter Highlights
| • | Completed the sale of its PICC and Midline product portfolios to Spectrum Vascular on February 15, 2024 | |
|---|---|---|
| o | Discontinued its Uniblate and Starburst RadioFrequency products, as well as its Syntrax support catheter products, to further streamline its product<br> portfolio | |
| --- | --- | |
| GAAP As Reported | Pro Forma* | |
| --- | --- | --- |
| Net Sales: | $75.2 million | $66.0 million |
| Growth: | N/A | 8.0% |
| Gross Margin | 47.7% | 51.1% |
| GAAP Loss per Share** | $(4.73) | N/A |
| Adj. Loss per Share | N/A | $(0.16) |
*“Pro forma” results exclude the Dialysis and BioSentry businesses divested in June 2023 and the PICC and Midline product portfolios divested in February 2024, as well as the discontinued Uniblate, Starburst, and Syntrax products. “As Reported” results include sales of the divested assets through February 14, 2024
**GAAP Loss per share includes a $159.5 million goodwill impairment and $22.0 million related to the previously announced settlement of IP litigation. The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q
1
| • | Pro forma Med Tech net sales of $25.7 million increased 12.6% |
|---|---|
| • | Pro forma Med Device net sales of $40.3 million increased 5.2% |
| --- | --- |
| • | Subsequent to quarter end, the Company entered into a settlement agreement with Becton, Dickinson and Company (“BD”) to resolve all patent litigation with<br> C.R. Bard, Inc., an affiliate of BD |
| --- | --- |
| • | Subsequent to quarter end, the Company received 510(k) clearance for the use of AlphaVac to treat pulmonary embolism |
| --- | --- |
Latham, New York, April 4, 2024 – AngioDynamics, Inc. (NASDAQ: ANGO), a leading and transformative medical technology company focused on restoring healthy blood flow in the body’s vascular system, expanding cancer treatment options and improving quality of life for patients, today announced financial results for the third quarter of fiscal year 2024, which ended February 29, 2024.
“During our fiscal third quarter, we took another significant step in our transformation with the divestiture of our PICC and Midline product portfolios, further strengthening our balance sheet and providing us with an opportunity to enhance our focus on the growth of our Med Tech portfolio,” commented Jim Clemmer, President and Chief Executive Officer of AngioDynamics, Inc. “We saw a strong pick up in growth from both our Med Tech and Med Device portfolios during the quarter and continue to drive toward meaningful margin expansion and profitability.”
Mr. Clemmer continued, “Subsequent to the end of our fiscal third quarter, we reached a settlement agreement with BD/Bard that provides us with clarity and certainty going forward. This allows us to avoid continued litigation and keep the team focused on further developing our key growth platforms. I am also very pleased to announce that earlier this week we received FDA 510(k) clearance for AlphaVac in the treatment of pulmonary embolism. This approval came in ahead of even our expectations and is a testament to the strong submission compiled by our team and the compelling data generated by our APEX trial. This expanded indication is a significant piece of our long-term strategy and validates the effectiveness of the product, opening up another large, fast-growing market for us to serve with this innovative platform.”
Third Quarter 2024 Financial Results
Unless otherwise noted, all financial results below are presented on a pro forma basis excluding the Dialysis and BioSentry businesses divested in June 2023, the PICC and Midline product portfolios divested in February 2024, and the recently discontinued Uniblate and Starburst RadioFrequency products and Syntrax support catheter products.
Net sales for the third quarter of fiscal year 2024 were $66.0 million, an increase of 8.0% compared to the prior-year quarter. Foreign currency translation did not have a significant impact on the Company’s net sales in the quarter.
2
Med Tech net sales were $25.7 million, a 12.6% increase from $22.8 million in the prior-year period. Med Tech includes the Auryon peripheral atherectomy platform, the thrombus management platform and the NanoKnife irreversible electroporation platform. Year-over-year growth was driven by Auryon sales during the quarter of $11.8 million, which increased 14.7%, and NanoKnife sales of $6.0 million, which increased 46.7% compared to the third quarter of fiscal 2023. NanoKnife disposable sales were $4.2 million, which increased 19.8% compared to the third quarter of fiscal 2023. AngioVac sales were $5.5 million, similar to the prior-year quarter, while AlphaVac sales were $1.1 million, down from $2.0 million in the third quarter of fiscal 2023.
Med Device net sales were $40.3 million, an increase of 5.2% compared to the prior-year period.
U.S. net sales in the third quarter of fiscal 2024 were $55.8 million, an increase of 5.9% from sales of $52.7 million a year ago. International net sales were $10.1 million, an increase of 20.8% from sales of $8.4 million in the prior-year period.
GAAP reported gross margin was 47.7%, a decrease of 250 basis points compared to the third quarter of fiscal 2023. On a pro forma basis, gross margin for the third quarter of fiscal 2024 was 51.1%, a decline of 290 basis points from the third quarter of fiscal 2023. Gross margin for the Med Tech business was 61.5%, a decline of 300 basis points from the third quarter of fiscal 2023. The year-over-year decline in gross margin for the Med Tech business was driven primarily by product and geographic mix. Gross margin for the Med Device business was 44.4%, a decrease of 330 basis points compared to the third quarter of fiscal 2023. The year-over-year decline in gross margin for the Med Device business was driven primarily by a supplier recall as well as costs associated with the Company’s ongoing transition to outsourced manufacturing.
The Company recorded a GAAP net loss of $190.4 million, or a loss per share of $4.73, in the third quarter of fiscal 2024. The GAAP net loss includes a goodwill impairment charge of $159.5 million, settlement charge of $22.0 million and asset impairment charges totaling $6.7 million related to the transition to outsourced manufacturing and discontinuation of Syntrax. The amount of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q. Excluding the items shown in the non-GAAP reconciliation table below, adjusted net loss for the third quarter of fiscal 2024 was $6.5 million, and adjusted loss per share was $0.16.
Adjusted EBITDA in the third quarter of fiscal 2024, excluding the items shown in the reconciliation table below, was negative $3.6 million, compared to adjusted EBITDA of negative $1.5 million in the third quarter of fiscal 2023.
3
On February 29, 2024, the Company had $78.5 million in cash and cash equivalents and no debt compared to $44.6 million in cash and cash equivalents and $50.0 million of debt on May 31, 2023.
In the third quarter of fiscal 2024, the Company used $12.5 million in operating cash, had capital expenditures of $0.6 million and had additions to Auryon placement and evaluation units of $1.2 million. Cash flow during the third quarter was significantly impacted by a combination of timing and extraordinary items related to both the divestiture transaction and manufacturing restructuring as well as approximately $1.0 million related to a supplier recall.
Nine Months Financial Results
Unless otherwise noted, all financial results below are presented on a pro forma basis excluding the Dialysis and BioSentry businesses divested in June 2023, the PICC and Midline product portfolios divested in February 2024, and the recently discontinued Uniblate and Starburst RadioFrequency products and Syntrax support catheter products.
For the nine months ended February 29, 2024:
Net sales were $199.6 million, an increase of 6.5% compared to $187.4 million for the same period a year ago.
Med Tech net sales were $76.6 million, a 9.6% increase from the prior-year period. Med Device net sales were $123.0 million, an increase of 4.6% from the prior-year period.
U.S. net sales were $167.6 million, a 3.6% increase from the prior-year period. International net sales were $32.0 million, an increase of 24.6% from the prior-year period.
GAAP reported gross margin was 49.9%, a decrease of 170 basis points compared to the prior-year period. On a pro forma basis, gross margin was 53.6%, a decline of 150 basis points from the prior-year period. The year-over-year decline in gross margin was driven primarily by a supplier recall as well as costs associated with the Company’s ongoing transition to outsourced manufacturing.
The Company’s GAAP net loss was $173.6 million, or a loss of $4.33 per share, compared to a net loss of $31.0 million, or a loss of $0.79 per share, a year ago. The GAAP net loss includes a goodwill impairment charge of $159.5 million, settlement charge of $22.0 million and asset impairment charges totaling $6.8 million related to the transition to outsourced manufacturing and discontinuation of Syntrax. The amount of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q. Excluding the items shown in the non-GAAP reconciliation table below, adjusted net loss was $16.1 million, with adjusted loss per share of $0.40, compared to adjusted net loss and adjusted loss per share of $17.5 million and $0.44, respectively, a year ago.
4
Adjusted EBITDA, excluding the items shown in the reconciliation table below, was negative $4.7 million, compared to negative $4.3 million for the same period a year ago.
Fiscal Year 2024 Financial Guidance
The Company now expects its fiscal year 2024 net sales to be in the range of $270 to $275 million, which reflects the recent divestiture of the PICC and Midline businesses and discontinuance of the RadioFrequency ablation and Syntrax businesses, which accounted for approximately $50 million of the prior revenue guidance of $320 to $325 million. The Company expects gross margin to be approximately 52.0% to 54.0% and adjusted loss per share in the range of $0.54 to $0.58.
For comparison, pro forma revenue, gross margin, and adjusted loss per share for FY23 when excluding the discontinued assets and the assets divested to Spectrum Vascular and Merit Medical were $257.2 million, 54.9%, and $0.55, respectively.
Conference Call
The Company’s management will host a conference call today at 8:00 a.m. ET to discuss its third quarter 2024 results.
To participate in the conference call, dial 1-877-407-0784 (domestic) or +1-201-689-8560 (international) and refer to the passcode 13745239.
This conference call will also be webcast and can be accessed from the “Investors” section of the AngioDynamics website at www.angiodynamics.com. The webcast replay of the call will be available at the same site approximately one hour after the end of the call.
A recording of the call will also be available from 10:00 a.m. ET on Thursday, April 4, 2024, until 11:59 p.m. ET on Thursday, April 11, 2024. To hear this recording, dial 1-844-512-2921 (domestic) or +1-412-317-6671 (international) and enter the passcode 13745239.
5
Use of Non-GAAP Measures
Management uses non-GAAP measures to establish operational goals and believes that non-GAAP measures may assist investors in analyzing the underlying trends in AngioDynamics' business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting measures prepared in accordance with GAAP. In this news release, AngioDynamics has reported pro-forma results, adjusted EBITDA, adjusted net income and adjusted earnings per share. Management uses these measures in its internal analysis and review of operational performance. Management believes that these measures provide investors with useful information in comparing AngioDynamics' performance over different periods. By using these non-GAAP measures, management believes that investors get a better picture of the performance of AngioDynamics' underlying business. Management encourages investors to review AngioDynamics' financial results prepared in accordance with GAAP to understand AngioDynamics' performance taking into account all relevant factors, including those that may only occur from time to time but have a material impact on AngioDynamics' financial results. Please see the tables that follow for a reconciliation of non-GAAP measures to measures prepared in accordance with GAAP.
About AngioDynamics, Inc.
AngioDynamics is a leading and transformative medical technology company focused on restoring healthy blood flow in the body’s vascular system, expanding cancer treatment options and improving quality of life for patients.
The Company’s innovative technologies and devices are chosen by talented physicians in fast-growing healthcare markets to treat unmet patient needs. For more information, visit www.angiodynamics.com.
Safe Harbor
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics' expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include the words such as "expects," "reaffirms," "intends," "anticipates," "plans," "believes," "seeks," "estimates," "projects, " "optimistic," or variations of such words and similar expressions, are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ materially from AngioDynamics' expectations, expressed or implied. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the scale and scope of the COVID-19 global pandemic, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics' technology or assertions that AngioDynamics' technology infringes the technology of third parties, the ability of AngioDynamics to effectively compete against competitors that have substantially greater resources, future actions by the FDA or other regulatory agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic conditions (including inflation, labor shortages and supply chain challenges including the cost and availability of raw materials), the results of on-going litigation, challenges with respect to third-party distributors or joint venture partners or collaborators, the results of sales efforts, the effects of product recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic, credit and capital market conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to obtain regulatory clearances or approval of its products, or to integrate acquired businesses, as well as the risk factors listed from time to time in AngioDynamics' SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2023. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason.
In the United States, the NanoKnife System has received a 510(k) clearance by the Food and Drug Administration for use in the surgical ablation of soft tissue and is similarly approved for commercialization in Canada, the European Union and Australia. The NanoKnife System has not been cleared for the treatment or therapy of a specific disease or condition.
6
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
| Three Months Ended | Three Months Ended | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Actual^(1)^<br><br> <br>Feb 29, 2024 | Pro Forma<br><br> <br>Adjustments^(2)^<br><br> <br>Feb 29, 2024 | Pro Forma<br><br> <br>Feb 29, 2024 | As Reported^(1)^<br><br> <br>Feb 28, 2023 | Pro Forma<br><br> <br>Adjustments^(2)^<br><br> <br>Feb 28, 2023 | Pro Forma<br><br> <br>Feb 28, 2023 | |||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||
| Net sales | $ | 75,182 | (9,211 | ) | $ | 65,971 | $ | 80,712 | (19,622 | ) | $ | 61,090 | ||||||
| Cost of sales (exclusive of intangible amortization) | 39,321 | (7,038 | ) | 32,283 | 40,208 | (12,096 | ) | 28,112 | ||||||||||
| Gross profit | 35,861 | (2,173 | ) | 33,688 | 40,504 | (7,526 | ) | 32,978 | ||||||||||
| % of net sales | 47.7 | % | 51.1 | % | 50.2 | % | 54.0 | % | ||||||||||
| Operating expenses | ||||||||||||||||||
| Research and development | 8,189 | (117 | ) | 8,072 | 6,852 | (139 | ) | 6,713 | ||||||||||
| Sales and marketing | 25,405 | (1,758 | ) | 23,647 | 25,406 | (1,404 | ) | 24,002 | ||||||||||
| General and administrative | 10,578 | 22 | 10,600 | 8,839 | (306 | ) | 8,533 | |||||||||||
| Amortization of intangibles | 3,287 | (643 | ) | 2,644 | 4,739 | (1,448 | ) | 3,291 | ||||||||||
| Goodwill impairment ^(3)^ | 159,476 | — | 159,476 | — | — | — | ||||||||||||
| Change in fair value of contingent consideration | 112 | — | 112 | 227 | — | 227 | ||||||||||||
| Acquisition, restructuring and other items, net | 38,116 | (6,266 | ) | 31,850 | 3,369 | — | 3,369 | |||||||||||
| Total operating expenses | 245,163 | (8,762 | ) | 236,401 | 49,432 | (3,297 | ) | 46,135 | ||||||||||
| Gain on sale of assets | 6,657 | (6,657 | ) | — | — | — | — | |||||||||||
| Operating loss | (202,645 | ) | (68 | ) | (202,713 | ) | (8,928 | ) | (4,229 | ) | (13,157 | ) | ||||||
| Interest income (expense), net | 394 | — | 394 | (736 | ) | — | (736 | ) | ||||||||||
| Other expense, net | (238 | ) | — | (238 | ) | — | — | — | ||||||||||
| Total other income (expense), net | 156 | — | 156 | (736 | ) | — | (736 | ) | ||||||||||
| Loss before income tax expense (benefit) | (202,489 | ) | (68 | ) | (202,557 | ) | (9,664 | ) | (4,229 | ) | (13,893 | ) | ||||||
| Income tax benefit | (12,050 | ) | — | (12,050 | ) | (179 | ) | — | (179 | ) | ||||||||
| Net loss | $ | (190,439 | ) | $ | (68 | ) | $ | (190,507 | ) | $ | (9,485 | ) | $ | (4,229 | ) | $ | (13,714 | ) |
| Loss per share | ||||||||||||||||||
| Basic | $ | (4.73 | ) | $ | (4.73 | ) | $ | (0.24 | ) | $ | (0.35 | ) | ||||||
| Diluted | $ | (4.73 | ) | $ | (4.73 | ) | $ | (0.24 | ) | $ | (0.35 | ) | ||||||
| Weighted average shares outstanding | ||||||||||||||||||
| Basic | 40,234 | 40,234 | 39,509 | 39,509 | ||||||||||||||
| Diluted | 40,234 | 40,234 | 39,509 | 39,509 |
(1) Reflects the Company's US GAAP consolidated financial statements before pro forma adjustments related to the sale of the Dialysis and BioSentry Businesses, the sale of the PICCs and Midlines Businesses and the discontinuation of the RadioFrequency Ablation and Syntrax products ("the Businesses") for the three months ended February 29, 2024 and February 28, 2023.
(2) Reflects the elimination of revenues and expenses representing the operating results from the sales and discontinuation of the Businesses.
(3) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
7
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
| Nine Months Ended | Nine Months Ended | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Actual^(1)^<br><br> <br>Feb 29, 2024 | Pro Forma<br><br> <br>Adjustments^(2)^<br><br> <br>Feb 29, 2024 | Pro Forma<br><br> <br>Feb 29, 2024 | As Reported^(1)^<br><br> <br>Feb 28, 2023 | Pro Forma <br><br> Adjustments^(2)^<br><br> <br>Feb 28, 2023 | Pro Forma<br><br> <br>Feb 28, 2023 | |||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||
| Net sales | $ | 232,934 | (33,336 | ) | $ | 199,598 | $ | 247,678 | (60,260 | ) | $ | 187,418 | ||||||
| Cost of sales (exclusive of intangible amortization) | 116,751 | (24,121 | ) | 92,630 | 119,791 | (35,704 | ) | 84,087 | ||||||||||
| Gross profit | 116,183 | (9,215 | ) | 106,968 | 127,887 | (24,556 | ) | 103,331 | ||||||||||
| % of net sales | 49.9 | % | 53.6 | % | 51.6 | % | 55.1 | % | ||||||||||
| Operating expenses | ||||||||||||||||||
| Research and development | 24,788 | (647 | ) | 24,141 | 22,023 | (391 | ) | 21,632 | ||||||||||
| Sales and marketing | 78,237 | (4,714 | ) | 73,523 | 77,956 | (4,305 | ) | 73,651 | ||||||||||
| General and administrative | 30,723 | (52 | ) | 30,671 | 29,775 | (1,241 | ) | 28,534 | ||||||||||
| Amortization of intangibles | 10,474 | (2,571 | ) | 7,903 | 14,384 | (4,343 | ) | 10,041 | ||||||||||
| Goodwill impairment ^(3)^ | 159,476 | — | 159,476 | — | — | — | ||||||||||||
| Change in fair value of contingent consideration | 203 | — | 203 | 2,084 | — | 2,084 | ||||||||||||
| Acquisition, restructuring and other items, net | 47,516 | (6,394 | ) | 41,122 | 12,009 | (17 | ) | 11,992 | ||||||||||
| Total operating expenses | 351,417 | (14,378 | ) | 337,039 | 158,231 | (10,297 | ) | 147,934 | ||||||||||
| Gain on sale of assets | 54,499 | (54,499 | ) | — | — | — | — | |||||||||||
| Operating loss | (180,735 | ) | (49,336 | ) | (230,071 | ) | (30,344 | ) | (14,259 | ) | (44,603 | ) | ||||||
| Interest income (expense), net | 1,047 | — | 1,047 | (1,801 | ) | — | (1,801 | ) | ||||||||||
| Other expense, net | (558 | ) | — | (558 | ) | (427 | ) | — | (427 | ) | ||||||||
| Total other income (expense), net | 489 | — | 489 | (2,228 | ) | — | (2,228 | ) | ||||||||||
| Loss before income tax benefit | (180,246 | ) | (49,336 | ) | (229,582 | ) | (32,572 | ) | (14,259 | ) | (46,831 | ) | ||||||
| Income tax benefit | (6,643 | ) | — | (6,643 | ) | (1,597 | ) | — | (1,597 | ) | ||||||||
| Net loss | $ | (173,603 | ) | $ | (49,336 | ) | $ | (222,939 | ) | $ | (30,975 | ) | $ | (14,259 | ) | $ | (45,234 | ) |
| Loss per share | ||||||||||||||||||
| Basic | $ | (4.33 | ) | $ | (5.56 | ) | $ | (0.79 | ) | $ | (1.15 | ) | ||||||
| Diluted | $ | (4.33 | ) | $ | (5.56 | ) | $ | (0.79 | ) | $ | (1.15 | ) | ||||||
| Weighted average shares outstanding | ||||||||||||||||||
| Basic | 40,098 | 40,098 | 39,436 | 39,436 | ||||||||||||||
| Diluted | 40,098 | 40,098 | 39,436 | 39,436 |
(1) Reflects the Company's US GAAP consolidated financial statements before pro forma adjustments related to the sale of the Dialysis and BioSentry Businesses, the sale of the PICCs and Midlines Businesses and the discontinuation of the RadioFrequency Ablation and Syntrax products ("the Businesses") for the nine months ended February 29, 2024 and February 28, 2023.
(2) Reflects the elimination of revenues and expenses representing the operating results from the sales and discontinuation of the Businesses.
(3) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
8
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(in thousands, except per share data)
Reconciliation of Net Loss to non-GAAP Adjusted Net Loss:
| Three Months Ended | Nine Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Net loss | $ | (190,439 | ) | $ | (9,485 | ) | $ | (173,603 | ) | $ | (30,975 | ) |
| Amortization of intangibles | 3,287 | 4,739 | 10,474 | 14,384 | ||||||||
| Change in fair value of contingent consideration | 112 | 227 | 203 | 2,084 | ||||||||
| Acquisition, restructuring and other items, net^(1)^ | 38,116 | 3,369 | 47,516 | 12,009 | ||||||||
| Goodwill impairment ^(2)^ | 159,476 | — | 159,476 | — | ||||||||
| Gain on sale of assets | (6,657 | ) | — | (54,499 | ) | — | ||||||
| Tax effect of non-GAAP items ^(3)^ | (10,174 | ) | 127 | (2,716 | ) | (655 | ) | |||||
| Adjusted net loss | $ | (6,279 | ) | $ | (1,023 | ) | $ | (13,149 | ) | $ | (3,153 | ) |
| Reconciliation of Diluted Loss Per Share to non-GAAP Adjusted Diluted Loss Per Share: | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Diluted loss per share | $ | (4.73 | ) | $ | (0.24 | ) | $ | (4.33 | ) | $ | (0.79 | ) |
| Amortization of intangibles | 0.08 | 0.12 | 0.26 | 0.36 | ||||||||
| Change in fair value of contingent consideration | — | 0.01 | 0.01 | 0.05 | ||||||||
| Acquisition, restructuring and other items, net ^(1)^ | 0.95 | 0.08 | 1.18 | 0.32 | ||||||||
| Goodwill impairment ^(2)^ | 3.96 | — | 3.98 | — | ||||||||
| Gain on sale of assets | (0.17 | ) | — | (1.36 | ) | — | ||||||
| Tax effect of non-GAAP items ^(3)^ | (0.25 | ) | — | (0.07 | ) | (0.02 | ) | |||||
| Adjusted diluted loss per share | $ | (0.16 | ) | $ | (0.03 | ) | $ | (0.33 | ) | $ | (0.08 | ) |
| Adjusted diluted sharecount ^(4)^ | 40,234 | 39,509 | 40,098 | 39,436 |
(1) Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
(2) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
(3) Adjustment to reflect the income tax provision on a non-GAAP basis has been calculated assuming no valuation allowance on the Company's U.S. deferred tax assets and an effective tax rate of 23% for the periods ended February 29, 2024 and February 28, 2023.
(4) Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP loss.
9
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION (Continued)
(in thousands, except per share data)
Reconciliation of Net Loss to Adjusted EBITDA:
| Three Months Ended | Nine Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Net loss | $ | (190,439 | ) | $ | (9,485 | ) | $ | (173,603 | ) | $ | (30,975 | ) |
| Income tax expense (benefit) | (12,050 | ) | (179 | ) | (6,643 | ) | (1,597 | ) | ||||
| Interest expense, net | (394 | ) | 736 | (1,047 | ) | 1,801 | ||||||
| Depreciation and amortization | 7,522 | 7,787 | 20,895 | 23,175 | ||||||||
| Goodwill impairment ^(1)^ | 159,476 | — | 159,476 | — | ||||||||
| Change in fair value of contingent consideration | 112 | 227 | 203 | 2,084 | ||||||||
| Stock based compensation | 2,612 | 1,803 | 8,633 | 8,177 | ||||||||
| Acquisition, restructuring and other items, net ^(2)^ | 36,981 | 3,369 | 46,380 | 12,009 | ||||||||
| Gain on sale of assets | (6,657 | ) | — | (54,499 | ) | — | ||||||
| Adjusted EBITDA | $ | (2,837 | ) | $ | 4,258 | $ | (205 | ) | $ | 14,674 | ||
| Per diluted share: | ||||||||||||
| Adjusted EBITDA | $ | (0.07 | ) | $ | 0.11 | $ | (0.01 | ) | $ | 0.37 |
(1) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
(2) Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
10
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(in thousands, except per share data)
Reconciliation of Pro Forma Net Loss to Pro Forma Adjusted Net Loss:
| Pro Forma<br><br> <br>Three Months Ended | Pro Forma<br><br> <br>Nine Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Pro forma net loss | $ | (190,507 | ) | $ | (13,714 | ) | $ | (222,939 | ) | $ | (45,234 | ) |
| Amortization of intangibles | 2,644 | 3,291 | 7,903 | 10,041 | ||||||||
| Change in fair value of contingent consideration | 112 | 227 | 203 | 2,084 | ||||||||
| Acquisition, restructuring and other items, net ^(1)^ | 31,850 | 3,369 | 41,122 | 11,992 | ||||||||
| Goodwill impairment ^(2)^ | 159,476 | — | 159,476 | — | ||||||||
| Tax effect of non-GAAP items ^(3)^ | (10,101 | ) | 1,432 | (1,841 | ) | 3,627 | ||||||
| Adjusted pro forma net loss | $ | (6,526 | ) | $ | (5,395 | ) | $ | (16,076 | ) | $ | (17,490 | ) |
| Reconciliation of Pro Forma Diluted Loss Per Share to Pro Forma Adjusted Diluted Loss Per Share: | ||||||||||||
| --- | ||||||||||||
| Pro Forma<br><br> <br>Three Months Ended | Pro Forma<br><br> <br>Nine Months Ended | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Pro forma diluted loss per share | $ | (4.73 | ) | $ | (0.35 | ) | $ | (5.56 | ) | $ | (1.15 | ) |
| Amortization of intangibles | 0.07 | 0.08 | 0.20 | 0.25 | ||||||||
| Change in fair value of contingent consideration | — | 0.01 | 0.01 | 0.05 | ||||||||
| Acquisition, restructuring and other items, net ^(1)^ | 0.79 | 0.08 | 1.02 | 0.32 | ||||||||
| Goodwill impairment ^(2)^ | 3.96 | — | 3.98 | — | ||||||||
| Gain on sale of assets | — | — | — | — | ||||||||
| Tax effect of non-GAAP items ^(3)^ | (0.25 | ) | 0.04 | (0.05 | ) | 0.09 | ||||||
| Adjusted pro forma diluted loss per share | $ | (0.16 | ) | $ | (0.14 | ) | $ | (0.40 | ) | $ | (0.44 | ) |
| Adjusted diluted sharecount ^(4)^ | 40,234 | 39,509 | 40,098 | 39,436 |
(1) Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
(2) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
(3) Adjustment to reflect the income tax provision on a non-GAAP basis has been calculated assuming no valuation allowance on the Company's U.S. deferred tax assets and an effective tax rate of 23% for the periods ended February 29, 2024 and February 28, 2023.
(4) Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP loss.
11
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION (Continued)
(in thousands, except per share data)
Reconciliation of Pro Forma Net Loss to Pro Forma Adjusted EBITDA:
| Pro Forma<br><br> <br>Three Months Ended | Pro Forma<br><br> <br>Nine Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Pro forma net loss | $ | (190,507 | ) | $ | (13,714 | ) | $ | (222,939 | ) | $ | (45,234 | ) |
| Income tax benefit | (12,050 | ) | (179 | ) | (6,643 | ) | (1,597 | ) | ||||
| Interest expense, net | (394 | ) | 736 | (1,047 | ) | 1,801 | ||||||
| Depreciation and amortization | 6,861 | 6,288 | 18,234 | 18,680 | ||||||||
| Goodwill impairment ^(1)^ | 159,476 | — | 159,476 | — | ||||||||
| Change in fair value of contingent consideration | 112 | 227 | 203 | 2,084 | ||||||||
| Stock based compensation | 2,141 | 1,728 | 8,000 | 7,924 | ||||||||
| Acquisition, restructuring and other items, net ^(2)^ | 30,714 | 3,369 | 39,986 | 11,992 | ||||||||
| Pro forma adjusted EBITDA | $ | (3,647 | ) | $ | (1,545 | ) | $ | (4,730 | ) | $ | (4,350 | ) |
| Per diluted share: | ||||||||||||
| Adjusted EBITDA | $ | (0.09 | ) | $ | (0.04 | ) | $ | (0.12 | ) | $ | (0.11 | ) |
(1) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
(2) Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
12
ANGIODYNAMICS, INC. AND SUBSIDIARIES
ACQUISITION, RESTRUCTURING, AND OTHER ITEMS, NET DETAIL
(in thousands)
| Three Months Ended | Nine Months Ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| (in thousands) | Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | ||||||
| Legal ^(1)^ | $ | 26,063 | $ | 2,614 | $ | 33,202 | $ | 6,899 | ||
| Mergers and acquisitions ^(2)^ | 147 | — | 399 | — | ||||||
| Plant closure ^(3)^ | 5,426 | — | 6,115 | — | ||||||
| Intangible and other asset impairment ^(4)^ | 6,260 | — | 6,260 | — | ||||||
| Transition service agreement ^(5)^ | (333 | ) | — | (655 | ) | — | ||||
| Manufacturing relocation ^(6)^ | — | 324 | 587 | 1,062 | ||||||
| Israeli Innovation Authority prepayment ^(7)^ | — | — | — | 3,544 | ||||||
| Other ^(8)^ | 553 | 431 | 1,608 | 504 | ||||||
| Total | $ | 38,116 | $ | 3,369 | $ | 47,516 | $ | 12,009 |
(1) Legal expenses related to litigation that is outside the normal course of business. For the three and nine months ended February 29, 2024, a $22.0 million settlement expense was recorded as a result of the Settlement Agreement that was entered into between the Company and BD.
(2) Mergers and acquisitions expense related to legal and due diligence.
(3) Included in the $6.1 million in plant closure for the nine months ended February 29, 2024 is $0.7 million that was previously included in manufacturing relocation.
(4) An impairment of $3.4 million on intangible assets and an inventory write-off of $2.9 million was taken in the third quarter of fiscal year 2024 relating to the abandonment of the Syntrax and RF product lines.
(5) Transition services agreements that were entered into with Merit and Spectrum.
(6) Expenses to relocate certain manufacturing lines out of Queensbury, NY.
(7) In the first quarter of fiscal year 2023, a $3.5 million payment was made to the Israeli Innovation Authority to fully satisfy the obligation related to grant funds that were provided to Eximo for development of the Auryon laser prior to the acquisition in the second quarter of fiscal year 2020.
(8) Included in the $1.6 million in other for the nine months ended February 29, 2024 is $0.9 million of deferred financing fees that were written-off in conjunction with the sale of the Dialysis and BioSentry businesses and concurrent extinguishment of the debt.
13
ANGIODYNAMICS, INC. AND SUBSIDIARIES
NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
(in thousands)
| Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Actual ^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | As<br><br> <br>Reported ^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | Actual | Pro Forma | |||||||||||||||||||||||||
| Feb 29,<br><br> <br>2024 | Feb 29,<br><br> <br>2024 | Feb 29,<br><br> <br>2024 | Feb 28,<br><br> <br>2023 | Feb 28,<br><br> <br>2023 | Feb 28,<br><br> <br>2023 | %<br><br> <br>Growth | Currency Impact | Constant Currency Growth | %<br><br> <br>Growth | Currency Impact | Constant Currency Growth | |||||||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||||||||||
| Net Sales | ||||||||||||||||||||||||||||||||
| Med Tech | $ | 25,844 | $ | (190 | ) | $ | 25,654 | $ | 22,874 | $ | (91 | ) | $ | 22,783 | 13.0 | % | 12.6 | % | ||||||||||||||
| Med Device | 49,338 | (9,021 | ) | 40,317 | 57,838 | (19,531 | ) | 38,307 | (14.7 | )% | 5.2 | % | ||||||||||||||||||||
| $ | 75,182 | $ | (9,211 | ) | $ | 65,971 | $ | 80,712 | $ | (19,622 | ) | $ | 61,090 | (6.9 | )% | 0.0 | % | (6.9 | )% | 8.0 | % | 0.0 | % | 8.0 | % | |||||||
| Net Sales | ||||||||||||||||||||||||||||||||
| United States | $ | 62,342 | $ | (6,521 | ) | $ | 55,821 | $ | 67,620 | $ | (14,932 | ) | $ | 52,688 | (7.8 | )% | 5.9 | % | ||||||||||||||
| International | 12,840 | (2,690 | ) | 10,150 | 13,092 | (4,690 | ) | 8,402 | (1.9 | )% | 0.0 | % | (1.9 | )% | 20.8 | % | ||||||||||||||||
| $ | 75,182 | $ | (9,211 | ) | $ | 65,971 | $ | 80,712 | $ | (19,622 | ) | $ | 61,090 | (6.9 | )% | 0.0 | % | (6.9 | )% | 8.0 | % | 0.0 | % | 8.0 | % |
(1) Reflects the Company's US GAAP consolidated financial statements before pro forma adjustments related to the sale of the Dialysis and BioSentry Businesses, the sale of the PICCs and Midlines Businesses and the discontinuation of the RadioFrequency Ablation and Syntrax products ("the Businesses") for the three months ended February 29, 2024 and February 28, 2023.
(2) Reflects the elimination of revenues and expenses representing the operating results from the sales and discontinuation of the Businesses.
GROSS PROFIT BY PRODUCT CATEGORY
(in thousands)
| Three Months Ended | Three Months Ended | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Actual^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | As Reported ^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | Actual | Pro Forma | |||||||||||||||||
| Feb 29,<br><br> 2024 | Feb 29,<br><br> 2024 | Feb 29,<br><br> 2024 | Feb 28,<br><br> 2023 | Feb 28,<br><br> 2023 | Feb 28,<br><br> 2023 | % Change | % Change | |||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||
| Med Tech | $ | 15,857 | $ | (83 | ) | $ | 15,774 | $ | 14,774 | $ | (93 | ) | $ | 14,681 | 7.3 | % | 7.4 | % | ||||||
| Gross profit % of sales | 61.4 | % | 61.5 | % | 64.6 | % | 64.5 | % | ||||||||||||||||
| Med Device | $ | 20,004 | $ | (2,090 | ) | $ | 17,914 | $ | 25,730 | $ | (7,433 | ) | $ | 18,297 | (22.3 | )% | (2.1 | )% | ||||||
| Gross profit % of sales | 40.5 | % | 44.4 | % | 44.5 | % | 47.7 | % | ||||||||||||||||
| Total | $ | 35,861 | $ | (2,173 | ) | $ | 33,688 | $ | 40,504 | $ | (7,526 | ) | $ | 32,978 | (11.5 | )% | 2.2 | % | ||||||
| Gross profit % of sales | 47.7 | % | 51.1 | % | 50.2 | % | 54.0 | % |
(1) Reflects the Company's US GAAP consolidated financial statements before pro forma adjustments related to the sale of the Dialysis and BioSentry Businesses, the sale of the PICCs and Midlines Businesses and the discontinuation of the RadioFrequency Ablation and Syntrax products ("the Businesses") for the three months ended February 29, 2024 and February 28, 2023.
(2) Reflects the elimination of revenues and expenses representing the operating results from the sales and discontinuation of the Businesses.
14
ANGIODYNAMICS, INC. AND SUBSIDIARIES
NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
(in thousands)
| Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Actual ^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | As<br><br> <br>Reported ^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | Actual | Pro Forma | |||||||||||||||||||||||||
| Feb 29,<br><br> <br>2024 | Feb 29,<br><br> <br>2024 | Feb 29,<br><br> <br>2024 | Feb 28,<br><br> <br>2023 | Feb 28,<br><br> <br>2023 | Feb 28,<br><br> <br>2023 | % Growth | Currency Impact | Constant Currency Growth | %<br><br> <br>Growth | Currency Impact | Constant Currency Growth | |||||||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||||||||||
| Net Sales | ||||||||||||||||||||||||||||||||
| Med Tech | $ | 77,068 | $ | (443 | ) | $ | 76,625 | $ | 70,193 | $ | (302 | ) | $ | 69,891 | 9.8 | % | 9.6 | % | ||||||||||||||
| Med Device | 155,866 | (32,893 | ) | 122,973 | 177,485 | (59,958 | ) | 117,527 | (12.2 | )% | 4.6 | % | ||||||||||||||||||||
| $ | 232,934 | $ | (33,336 | ) | $ | 199,598 | $ | 247,678 | $ | (60,260 | ) | $ | 187,418 | (6.0 | )% | 0.0 | % | (6.0 | )% | 6.5 | % | 0.0 | % | 6.5 | % | |||||||
| Net Sales | ||||||||||||||||||||||||||||||||
| United States | $ | 190,743 | $ | (23,098 | ) | $ | 167,645 | $ | 208,274 | $ | (46,496 | ) | $ | 161,778 | (8.4 | )% | 3.6 | % | ||||||||||||||
| International | 42,191 | (10,238 | ) | 31,953 | 39,404 | (13,764 | ) | 25,640 | 7.1 | % | (0.2 | )% | 6.9 | % | 24.6 | % | ||||||||||||||||
| $ | 232,934 | $ | (33,336 | ) | $ | 199,598 | $ | 247,678 | $ | (60,260 | ) | $ | 187,418 | (6.0 | )% | 0.0 | % | (6.0 | )% | 6.5 | % | 0.0 | % | 6.5 | % |
(1) Reflects the Company's US GAAP consolidated financial statements before pro forma adjustments related to the sale of the Dialysis and BioSentry Businesses, the sale of the PICCs and Midlines Businesses and the discontinuation of the RadioFrequency Ablation and Syntrax products ("the Businesses") for the nine months ended February 29, 2024 and February 28, 2023.
(2) Reflects the elimination of revenues and expenses representing the operating results from the sales and discontinuation of the Businesses.
GROSS PROFIT BY PRODUCT CATEGORY
(in thousands)
| Nine Months Ended | Nine Months Ended | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Actual^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | As Reported ^(1)^ | Pro Forma<br><br> <br>Adj. ^(2)^ | Pro Forma | Actual | Pro Forma | |||||||||||||||||
| Feb 29,<br><br> 2024 | Feb 29,<br><br> 2024 | Feb 29,<br><br> 2024 | Feb 28,<br><br> 2023 | Feb 28,<br><br> 2023 | Feb 28,<br><br> 2023 | % Change | % Change | |||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||
| Med Tech | $ | 48,400 | $ | (155 | ) | $ | 48,245 | $ | 44,816 | $ | (163 | ) | $ | 44,653 | 8.0 | % | 8.0 | % | ||||||
| Gross profit % of sales | 62.8 | % | 63.0 | % | 63.8 | % | 63.9 | % | ||||||||||||||||
| Med Device | $ | 67,783 | $ | (9,060 | ) | $ | 58,723 | $ | 83,071 | $ | (24,393 | ) | $ | 58,678 | (18.4 | )% | 0.1 | % | ||||||
| Gross profit % of sales | 43.5 | % | 47.7 | % | 46.8 | % | 49.9 | % | ||||||||||||||||
| Total | $ | 116,183 | $ | (9,215 | ) | $ | 106,968 | $ | 127,887 | $ | (24,556 | ) | $ | 103,331 | (9.2 | )% | 3.5 | % | ||||||
| Gross profit % of sales | 49.9 | % | 53.6 | % | 51.6 | % | 55.1 | % |
(1) Reflects the Company's US GAAP consolidated financial statements before pro forma adjustments related to the sale of the Dialysis and BioSentry Businesses, the sale of the PICCs and Midlines Businesses and the discontinuation of the RadioFrequency Ablation and Syntrax products ("the Businesses") for the nine months ended February 29, 2024 and February 28, 2023.
(2) Reflects the elimination of revenues and expenses representing the operating results from the sales and discontinuation of the Businesses.
15
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
| Feb 29, 2024 | May 31, 2023 | |||
|---|---|---|---|---|
| (unaudited) | (audited) | |||
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 78,451 | $ | 44,620 |
| Accounts receivable, net | 49,475 | 52,826 | ||
| Inventories | 58,068 | 55,325 | ||
| Prepaid expenses and other | 10,913 | 4,617 | ||
| Current assets held for sale | — | 6,154 | ||
| Total current assets | 196,907 | 163,542 | ||
| Property, plant and equipment, net | 37,040 | 44,384 | ||
| Other assets | 8,045 | 10,676 | ||
| Intangible assets, net | 81,570 | 111,144 | ||
| Goodwill | — | 159,238 | ||
| Non-current assets held for sale | — | 43,653 | ||
| Total assets | $ | 323,562 | $ | 532,637 |
| Liabilities and stockholders' equity | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 35,152 | $ | 40,445 |
| Accrued liabilities | 30,963 | 26,617 | ||
| Current portion of contingent consideration | 9,500 | 14,761 | ||
| Other current liabilities | 10,259 | 2,002 | ||
| Total current liabilities | 85,874 | 83,825 | ||
| Long-term debt | — | 49,818 | ||
| Deferred income taxes | 5,871 | 12,813 | ||
| Contingent consideration | — | 4,535 | ||
| Other long-term liabilities | 15,822 | 3,350 | ||
| Total liabilities | 107,567 | 154,341 | ||
| Stockholders' equity | 215,995 | 378,296 | ||
| Total Liabilities and Stockholders' Equity | $ | 323,562 | $ | 532,637 |
16
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
| Three Months Ended | Nine Months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Cash flows from operating activities: | ||||||||||||
| Net loss | $ | (190,439 | ) | $ | (9,485 | ) | $ | (173,603 | ) | $ | (30,975 | ) |
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||||||
| Depreciation and amortization | 7,522 | 7,838 | 20,895 | 23,316 | ||||||||
| Non-cash lease expense | 484 | 635 | 1,441 | 1,883 | ||||||||
| Stock based compensation | 2,612 | 1,803 | 8,633 | 8,177 | ||||||||
| Gain on disposal of assets | (6,657 | ) | — | (54,499 | ) | — | ||||||
| Transaction costs for disposition | (2,657 | ) | — | (5,084 | ) | — | ||||||
| Change in fair value of contingent consideration | 112 | 227 | 203 | 2,084 | ||||||||
| Impairment loss on indefinite-lived intangible assets ^(1)^ | 159,476 | — | 159,476 | — | ||||||||
| Deferred income taxes | (12,140 | ) | (227 | ) | (7,189 | ) | (1,752 | ) | ||||
| Change in accounts receivable allowances | 458 | 168 | 1,007 | 560 | ||||||||
| Fixed and intangible asset impairments and disposals | 6,845 | 57 | 7,084 | 144 | ||||||||
| Write-off of other assets | — | — | 869 | — | ||||||||
| Other | 299 | (274 | ) | 161 | (317 | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Accounts receivable | 1,668 | 1,778 | 2,345 | 759 | ||||||||
| Inventories | 2,019 | (423 | ) | (6,825 | ) | (12,254 | ) | |||||
| Prepaid expenses and other | (2,587 | ) | 3,539 | (7,566 | ) | (392 | ) | |||||
| Accounts payable, accrued and other liabilities | 20,459 | (4,266 | ) | 19,493 | (7,109 | ) | ||||||
| Net cash provided by (used in) operating activities | (12,526 | ) | 1,370 | (33,159 | ) | (15,876 | ) | |||||
| Cash flows from investing activities: | ||||||||||||
| Additions to property, plant and equipment | (607 | ) | (666 | ) | (1,952 | ) | (2,756 | ) | ||||
| Additions to placement and evaluation units | (1,239 | ) | (1,480 | ) | (3,245 | ) | (4,922 | ) | ||||
| Cash paid in acquisition | (3,250 | ) | — | (3,250 | ) | (540 | ) | |||||
| Proceeds from sale of assets | 34,500 | — | 134,500 | — | ||||||||
| Net cash provided by (used in) investing activities | 29,404 | (2,146 | ) | 126,053 | (8,218 | ) | ||||||
| Cash flows from financing activities: | ||||||||||||
| Repayment of long-term debt | — | — | (50,000 | ) | (45,000 | ) | ||||||
| Proceeds from borrowings on long-term debt | — | — | — | 70,000 | ||||||||
| Deferred financing costs on long-term debt | — | — | — | (751 | ) | |||||||
| Payment of acquisition related contingent consideration | — | — | (10,000 | ) | — | |||||||
| Proceeds from exercise of stock options and employee stock purchase plan | 694 | 941 | 752 | 1,171 | ||||||||
| Net cash provided by (used in) financing activities | 694 | 941 | (59,248 | ) | 25,420 | |||||||
| Effect of exchange rate changes on cash and cash equivalents | (17 | ) | 89 | 185 | (40 | ) | ||||||
| Increase in cash and cash equivalents | 17,555 | 254 | 33,831 | 1,286 | ||||||||
| Cash and cash equivalents at beginning of period | 60,896 | 29,857 | 44,620 | 28,825 | ||||||||
| Cash and cash equivalents at end of period | $ | 78,451 | $ | 30,111 | $ | 78,451 | $ | 30,111 |
(1) The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
17
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(in thousands)
| Reconciliation of Free Cash Flows: | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Three Months Ended | Nine Months Ended | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Feb 29, 2024 | Feb 28, 2023 | Feb 29, 2024 | Feb 28, 2023 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Net cash used in operating activities | $ | (12,526 | ) | $ | 1,370 | $ | (33,159 | ) | $ | (15,876 | ) | |
| Additions to property, plant and equipment | (607 | ) | (666 | ) | (1,952 | ) | (2,756 | ) | ||||
| Additions to placement and evaluation units | (1,239 | ) | (1,480 | ) | (3,245 | ) | (4,922 | ) | ||||
| Free Cash Flow | $ | (14,372 | ) | $ | (776 | ) | $ | (38,356 | ) | $ | (23,554 | ) |
18
Exhibit 99.2
AngioDynamics Third Quarter 2024 Earnings Presentation April 4, 2024
AngioDynamics First Quarter 2024 Earnings Forward-Looking Statement Notice Regarding Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include the words such as “expects,” “reaffirms,” “intends,” “anticipates,” “plans,” “projects,” “believes,” “seeks,” “estimates,” “optimistic,” or variations of such words and similar expressions, are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ materially from AngioDynamics’ expectations, expressed or implied. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the scale and scope of the COVID-19 global pandemic, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics’ technology or assertions that AngioDynamics’ technology infringes the technology of third parties, the ability of AngioDynamics to effectively compete against competitors that have substantially greater resources, future actions by the FDA or other regulatory agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic conditions (including inflation, labor shortages and supply chain challenges including the cost and availability of raw materials), the results of on-going litigation, challenges with respect to third-party distributors or joint venture partners or collaborators, the results of sales efforts, the effects of product recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic, credit and capital market conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to obtain regulatory clearances or approval of its products, or to integrate acquired businesses, as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2023. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason. In the United States, the NanoKnife System has received a 510(k) clearance by the Food and Drug Administration for use in the surgical ablation of soft tissue, and is similarly approved for commercialization in Canada, the European Union and Australia. The NanoKnife System has not been cleared for the treatment or therapy of a specific disease or condition. Notice Regarding Non-GAAP Financial Measures Management uses non-GAAP measures to establish operational goals and believes that non-GAAP measures may assist investors in analyzing the underlying trends in AngioDynamics’ business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting measures prepared in accordance with GAAP. In this presentation, AngioDynamics has reported pro forma results, adjusted EBITDA (income before interest, taxes, depreciation and amortization and stock-based compensation); adjusted net income and adjusted earnings per share. Management uses these measures in its internal analysis and review of operational performance. Management believes that these measures provide investors with useful information in comparing AngioDynamics’ performance over different periods. By using these non-GAAP measures, management believes that investors get a better picture of the performance of AngioDynamics’ underlying business. Management encourages investors to review AngioDynamics’ financial results prepared in accordance with GAAP to understand AngioDynamics’ performance taking into account all relevant factors, including those that may only occur from time to time but have a material impact on AngioDynamics’ financial results. Please see the tables that follow for a reconciliation of non-GAAP measures to measures prepared in accordance with GAAP. 2
IDE Clinical Studies and Pathway Expansion Corporate Developments – Pro forma Q3 and YTD FY24 (please see next slide for GAAP results) AngioDynamics Third Quarter 2024 Earnings 3 Initiated restructuring of manufacturing footprint to a fully outsourced model Divested the PICCs and Midlines businesses and received $34.5 million in cash in the third quarter Discontinued the RadioFrequency Ablation and Syntrax products Subsequent to quarter end, the Company entered into a settlement agreement with Becton, Dickinson and Company to resolve all patent litigation with C.R. Bard, Inc., an affiliate of BD GAAP results include a goodwill impairment charge of $159.5. (The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.) Q3 Highlights and Operational Developments Subsequent to quarter end, the Company received 510(k) clearance for the use of AlphaVac F1885 System to treat pulmonary embolism Med Tech up 12.6%* Med Device up 5.2%* Auryon sales of $11.8 million; growth of 14.7% YOY Mechanical Thrombectomy down 11.6% YOY $1.1 million in AlphaVac sales AngioVac sales increased 0.2% YOY NanoKnife disposable sales increased 19.8% YOY 8.0% Q3 FY24 Pro Forma Revenue Growth* Pro Forma Revenue* $66.0 mil * Pro forma excludes the sale of Dialysis and BioSentry, PICCs and Midlines and the discontinuation of Radiofrequency Ablation and Syntrax product lines Med Tech up 9.6%* Med Device up 4.6%* Auryon sales of $34.1 million; growth of 17.4% YOY Mechanical Thrombectomy down 7.3% YOY $4.8 million in AlphaVac sales AngioVac sales declined 6.3% YOY NanoKnife disposable sales increased 15.1% YOY 6.5% YTD FY24 Pro Forma Revenue Growth* $199.6 mil Pro Forma Revenue*
Q3 FY24 Results (unaudited) AngioDynamics Third Quarter 2024 Earnings 4 $ in thousands (except per share data) Q3 FY24 As Reported Q3 FY23 As Reported Change Q3 FY24 Pro Forma* Q3 FY23 Pro Forma* Change Revenue $75,182 $80,712 (6.9%) $65,971 $61,090 8.0% Med Tech Med Device $25,844 $49,338 $22,874 $57,838 13.0% (14.7%) $25,654 $40,317 $22,783 $38,307 12.6% 5.2% United States International $62,342 $12,840 $67,620 $13,092 (7.8%) (1.9%) $55,821 $10,150 $52,688 $8,402 5.9% 20.8% Gross Margin Med Tech Med Device 47.7% 61.4% 40.5% 50.2% 64.6% 44.5% (250 bps) (320 bps) (400 bps) 51.1% 61.5% 44.4% 54.0% 64.5% 47.7% (290 bps) (300 bps) (330 bps) Net Loss** Non-GAAP Adjusted Net Income (Loss) ($190,439) ($6,279) ($9,485) ($1,023) ($180,954) ($5,256) ($190,507) ($6,526) ($13,714) ($5,395) ($176,793) ($1,131) GAAP EPS** Non-GAAP Adjusted EPS ($4.73) ($0.16) ($0.24) $0.03 ($4.49) ($0.19) ($4.73) ($0.16) ($0.35) ($0.14) ($4.38) ($0.02) Adjusted EBITDA ($2,837) $4,258 ($7,095) ($3,647) ($1,545) ($2,102) $ in thousands Q3 FY24 Q4 FY23 Change Cash $78,451 $44,620 $33,831 Debt Revolving Facility Delayed-Draw Term Loan $0 $0 $0 $50,000 $25,000 $25,000 ($50,000) ($25,000) ($25,000) Net Cash (Debt) $78,451 ($5,380) $83,831 *On a pro forma basis, excluding the sale of Dialysis and BioSentry, PICCs and Midlines and the discontinuation of RadioFrequency Ablation and Syntrax **Includes a goodwill impairment charge of $159.5 million. The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
YTD FY24 Results (unaudited) AngioDynamics Third Quarter 2024 Earnings 5 $ in thousands (except per share data) YTD FY24 As Reported YTD FY23 As Reported Change YTD FY24 Pro Forma* YTD FY23 Pro Forma* Change Revenue $232,934 $247,678 (6.0%) $199,598 $187,418 6.5% Med Tech Med Device $77,068 $155,866 $70,193 $177,485 9.8% (12.2%) $76,625 $122,973 $69,891 $117,527 9.6% 4.6% United States International $190,743 $42,191 $208,274 $39,404 (8.4%) 7.1% $167,645 $31,953 $161,778 $25,640 3.6% 24.6% Gross Margin Med Tech Med Device 49.9% 62.8% 43.5% 51.6% 63.8% 46.8% (170 bps) (100 bps) (330 bps) 53.6% 63.0% 47.7% 55.1% 63.9% 49.9% (150 bps) (90 bps) (220 bps) Net Income (Loss)** Non-GAAP Adjusted Net Loss ($173,603) ($13,149) ($30,975) ($3,153) ($142,628) ($9,996) ($222,939) ($16,076) ($45,234) ($17,490) ($177,705) $1,414 GAAP EPS** Non-GAAP Adjusted EPS ($4.33) ($0.33) ($0.79) ($0.08) ($3.54) ($0.25) ($5.56) ($0.40) ($1.15) ($0.44) ($4.41) $0.04 Adjusted EBITDA ($205) $14,674 ($14,879) ($4,730) ($4,350) ($380) $ in thousands Q3 FY24 Q4 FY23 Change Cash $78,451 $44,620 $33,831 Debt Revolving Facility Delayed-Draw Term Loan $0 $0 $0 $50,000 $25,000 $25,000 ($50,000) ($25,000) ($25,000) Net Cash (Debt) $78,451 ($5,380) $83,831 *On a pro forma basis, excluding the sale of Dialysis and BioSentry, PICCs and Midlines and the discontinuation of RadioFrequency Ablation and Syntrax **Includes a goodwill impairment charge of $159.5 million. The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q.
Q3 and YTD FY24 Results (pro forma*) 6 Med Device Med Tech 12.6% growth 5.2% growth Q3 Revenue Growth Q3 FY23 Q3 FY24 Q3 Revenue Contribution Q3 FY23 Q3 FY24 Med Tech Gross Margin 61.5% Med Device Gross Margin 44.4% AngioDynamics Third Quarter 2024 Earnings Med Device Med Tech 9.6% growth 4.6% growth YTD Revenue Growth YTD FY23 YTD FY24 YTD Revenue Contribution YTD FY23 YTD FY24 Med Tech Gross Margin 63.0% Med Device Gross Margin 47.7% * On a pro forma basis, excluding the sale of Dialysis and BioSentry, PICCs and Midlines and the discontinuation of RadioFrequency Ablation and Syntrax
Sales Comparison to Prior-Year Period AngioDynamics Third Quarter 2024 Earnings 7 Med Tech Q3FY24 YTD FY24 Auryon 14.7% 17.4% Thrombus Management* AngioVac AlphaVac (6.5%) 0.2% (43.8%) (6.6%) (6.3%) (10.5%) NanoKnife® Disposables 19.8% 15.1% NanoKnife® Capital 230.9% 68.6% Med Device Q3 FY24 YTD FY24 Core Peripheral 7.1% 2.9% Venous/EVLT 22.4% 9.4% Ports 5.2% 10.6% Solero® Microwave (8.1%) 2.3% Alatus and IsoLoc Balloons (21.9%) (2.4%) * Thrombus Management includes AngioVac, AlphaVac and Thrombolytics
FY24 Updated Guidance 8 * FY23 pro forma results excluding the divested and discontinued assets were $257.2 million for revenue, 54.9% for gross margin and adjusted loss per share of $0.55. AngioDynamics Third Quarter 2024 Earnings Guidance* Updated Guidance* Revenue $328 - $333 million $270 - $275 million Gross Margin Med Tech Med Device 50.0% - 52.0% 63.0% – 65.0% 43.0% - 45.0% 52.0% - 54.0% 61.0% – 63.0% 46.0% - 48.0% Adjusted EPS ($0.28) – ($0.34) ($0.54) – ($0.58)
GAAP to Non-GAAP Reconciliation
10 (in thousands, except per share data) (in thousands, except per share data) Reconciliation of GAAP to Non-GAAP Pro Forma Results for the Consolidated Income Statements
Reconciliation of GAAP to Non-GAAP Adjusted Net Loss and EPS Reconciliation of Net Loss to Adjusted EBITDA Includes costs related to merger and acquisition activities, restructurings, and unusual items, including asset impairments and write-offs, certain litigation, and other items. The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q. Adjustment to reflect the income tax provision on a non-GAAP basis has been calculated assuming no valuation allowance on the Company's U.S. deferred tax assets and an effective tax rate of 23% for the periods ended February 29,2024 and February 28, 2023. Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP loss. The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q. Includes costs related to merger and acquisition activities, restructurings, and unusual items, including asset impairments and write-offs, certain litigation, and other items. (in thousands, except per share data) (in thousands) 11
Reconciliation of Non-GAAP Pro Forma Net Loss to Adjusted Pro Forma Net Loss and EPS Reconciliation of Non-GAAP Pro Forma Net Loss to Adjusted Pro Forma EBITDA Includes costs related to merger and acquisition activities, restructurings, and unusual items, including asset impairments and write-offs, certain litigation, and other items. The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q. Adjustment to reflect the income tax provision on a non-GAAP basis has been calculated assuming no valuation allowance on the Company's U.S. deferred tax assets and an effective tax rate of 23% for the periods ended February 29, 2024 and February 28, 2023. Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP loss. (in thousands, except per share data) (in thousands) 12 The total value of the goodwill impairment is preliminary, is undergoing further evaluation and will be adjusted, if necessary, prior to the filing of the Company’s quarterly report on Form 10-Q. Includes costs related to merger and acquisition activities, restructurings, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
13 Detail of “Acquisition, Restructuring and Other Items, net”
14 (in thousands) Reconciliation of GAAP to Non-GAAP Pro Forma Results for Sales and Gross Margin by Product Category (in thousands)
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