8-K
Angiodynamics Inc (ANGO)
View as plain text
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 7, 2022
AngioDynamics, Inc.
(Exact Name of Registrant as Specified in Charter)
| Delaware | 000-50761 | 11-3146460 |
|---|---|---|
| (State or Other Jurisdiction of Incorporation) | (Commission File<br><br> <br>Number) | (IRS Employer<br><br> <br>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<br><br> 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 7, 2022, AngioDynamics, Inc. (“AngioDynamics”) issued a press release announcing financial results for the fiscal third quarter ended February 28, 2022. 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 28, 2022 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,” “project”, “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, express 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 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, 2021. 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 7, 2022. |
| 99.2 | Presentation, dated April 7, 2022. |
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 7, 2022 | By: | /s/ Richard C. Rosenzweig |
| Name: Richard C. Rosenzweig | ||
| Title: Senior Vice President, General<br><br> <br>Counsel and Secretary |
Exhibit 99.1
PRESS RELEASE
Investor Contact:
AngioDynamics, Inc.
Stephen Trowbridge, Executive Vice President & CFO
(518) 795-1408
AngioDynamics Reports Fiscal 2022 Third Quarter Financial Results; Reaffirms Fiscal Year 2022 Guidance
Fiscal 2022 Third Quarter Highlights
| • | Net sales of $74.0 million increased 3.9% compared to the prior-year quarter |
|---|---|
| • | Med Tech grew 28.6% and Med Device declined 2.8% year over year |
| --- | --- |
| • | Gross margin of 52.2% declined 190 basis points year over year |
| --- | --- |
| • | GAAP loss per share of $0.13 and adjusted earnings per share of $0.03 |
| --- | --- |
| • | Subsequent to quarter end: |
| --- | --- |
| o | the Company enrolled the first patients in its PRESERVE study for the use of NanoKnife in prostate; |
| --- | --- |
| o | the Company received FDA approval for its AlphaVac F18 thrombectomy system; and |
| --- | --- |
| o | the Company received FDA approval for its IDE study for the use of AlphaVac F18 to treat<br> pulmonary embolism |
| --- | --- |
Latham, New York, April 7, 2022 – 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 2022, which ended February 28, 2022.
“We are proud of our team’s ability to drive continued growth in our business during the third quarter while operating amid macro-related supply chain disruptions, procedural volume challenges and ongoing inflation, particularly in December and January. During the quarter, we made significant progress implementing our manufacturing capacity enhancement initiatives, exiting the quarter with an approximately 20% increase in production hours. Even as we started to see benefits of our capacity enhancement initiatives, we saw our backlog increase during our third
quarter, signaling continued strong customer demand. Since mid-February, we have seen steady improvement in procedure volumes and remain confident in both the long-term growth trajectory of our portfolio and the strategic transformation of the Company,” commented Jim Clemmer, President and Chief Executive Officer of AngioDynamics.
Clemmer continued, “Despite the increased COVID and macro headwinds in our third quarter, we continued to invest in our transformation to make Med Tech comprise a larger, faster-growing piece of our business. As an example, we are pleased to announce the recent FDA clearance of our AlphaVac F18 thrombectomy system for use in the venous vasculature and approval of our IDE study for the use of AlphaVac F18 to treat pulmonary embolism.”
Third Quarter 2022 Financial Results
Net sales for the third quarter of fiscal 2022 were $74.0 million, an increase of 3.9% compared to the prior-year quarter.
Foreign currency translation did not have a significant impact on the Company’s sales in the quarter.
Med Tech net sales were $19.6 million, a 28.6% increase from $15.2 million in the prior- year period, while Med Device net sales were $54.4 million, a decrease of 2.8% compared to $55.9 million in the prior-year period. Med Tech includes the Auryon Peripheral Atherectomy platform, the thrombectomy platform and the NanoKnife irreversible electroporation platform. The Company’s performance was impacted by headwinds related to the Omicron variant spike, particularly during the months of December and January, which included supply chain disruptions, procedural challenges and continued inflationary pressures.
| • | Endovascular Therapies (formerly Vascular Interventions and Therapies) net sales were $38.1 million, an increase of 14.5%, compared to<br> $33.3 million a year ago. Growth was driven by strength in our atherectomy and thrombectomy portfolios relative to the prior-year period. Auryon sales during the quarter were $7.3 million, as the Company continued to see sequential sales<br> growth of this platform. |
|---|---|
| • | Oncology net sales were $12.5 million, a decrease of 5.0%, compared to $13.1 million in the prior-year period. The year-over-year<br> decline was largely due to procedural volume pressures related to COVID and lower NanoKnife capital sales, partially offset by increased sales of NanoKnife disposables in the U.S. |
| --- | --- |
| • | Vascular Access net sales were $23.4 million, a decrease of 5.6%, compared to $24.8 million a year ago. |
| --- | --- |
| • | Med Device products make up the majority of the Company’s backlog, which stood at approximately $9.6 million at the end of the third<br> quarter. |
| --- | --- |
U.S. net sales in the third quarter of fiscal 2022 were $62.4 million, an increase of 6.5% from $58.7 million a year ago. International net sales were $11.5 million, a decrease of 8.0%, compared to $12.5 million a year ago. International net sales were primarily impacted by the global Omicron variant spike and reduced capital sales.
Gross margin for the third quarter of fiscal 2022 was 52.2%, a decrease of 190 basis points compared to the third quarter of fiscal 2021. During the quarter, gross margin continued to be negatively impacted by macro forces including the tight labor market and increased expense for raw materials, labor and freight.
The Company recorded a net loss of $5.0 million, or a loss per share of $0.13, in the third quarter of fiscal 2022. This compares to a net loss of $3.5 million, or a loss per share of $0.09, a year ago.
Excluding the items shown in the non-GAAP reconciliation table below, adjusted net income for the third quarter of fiscal 2022 was $1.3 million, and adjusted earnings per share was $0.03 compared to adjusted net income in the prior-year period of $0.7 million and adjusted earnings per share of $0.02. Adjusted net income and adjusted earnings per share in the third quarter of fiscal 2022 includes a $4.2 million, or $0.08 per share benefit, respectively, related to the reimbursement of certain expenses under the employee retention credit as part of the CARES Act. A similar reimbursement benefit of $1.9 million was included in the prior year period.
Adjusted EBITDA in the third quarter of fiscal 2022, excluding the items shown in the reconciliation table below, was $6.7 million, compared to $5.4 million in the third quarter of fiscal 2021.
In the third quarter of fiscal 2022, the Company utilized $8.8 million in operating cash, had capital expenditures of $1.1 million and additions to Auryon placement and evaluation units of $1.5 million. As of February 28, 2022, the Company had $23.9 million in cash and cash equivalents compared to $34.3 million in cash and cash equivalents on November 30, 2021. The Company had debt outstanding of $25.0 million on February 28, 2022, unchanged from November 30, 2021.
Nine Months Financial Results
For the nine months ended February 28, 2022:
| • | Net sales were $229.2 million, an increase of 7.0%, compared to $214.2 million for the same period a year ago. |
|---|---|
| • | Med Tech net sales were $56.1 million, a 41.8% increase from the prior year period. Med Device net sales were $173.1 million, a<br> decrease of 0.8% from the prior year period. |
| --- | --- |
| • | The Company’s net loss was $20.3 million, or a loss of $0.52 per share, compared to a net loss of $12.1 million, or a loss of $0.32 per<br> share, a year ago. |
|---|---|
| • | Gross margin decreased 140 basis points to 52.0% from 53.4% a year ago. |
| --- | --- |
| • | Excluding the items shown in the non-GAAP reconciliation table, below, adjusted net loss was $0.4 million, with adjusted loss per share<br> of $0.01, compared to adjusted net income and adjusted earnings per share of $1.9 million, and $0.05, respectively, a year ago. |
| --- | --- |
| • | Adjusted EBITDA, excluding the items shown in the reconciliation table below, was $14.7 million, compared to $15.0 million for the same<br> period a year ago. |
| --- | --- |
Reiterating Fiscal Year 2022 Guidance
The Company continues to expect:
| • | Fiscal year 2022 net sales to be in the range of $310 to $315 million; |
|---|---|
| • | Gross margin to be in the range of 52.0% to 54.0%; and |
| --- | --- |
| • | Adjusted earnings per share in the range of a loss of $0.02 to a gain of $0.02. |
| --- | --- |
Conference Call
The Company's management will host a conference call today at 8:00 a.m. ET to discuss its third quarter results.
To participate in the conference call, dial 1-877-407-0784 (domestic) or +1-201-689-8560 (international) and refer to the passcode 13727875.
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 11:00 a.m. ET on Thursday, April 7, 2022, until 11:59 p.m. ET on Thursday, April 14, 2022. To hear this recording, dial 1-844-512-2921 (domestic) or +1-412-317-6671 (international) and enter the passcode 13727875.
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 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, 2021. 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.
| ANGIODYNAMICS, INC. AND SUBSIDIARIES | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| CONSOLIDATED INCOME STATEMENTS | ||||||||||||
| (in thousands, except per share data) | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Feb 28, 2022 | Feb 28, 2021 | Feb 28, 2022 | Feb 28, 2021 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Net sales | $ | 73,970 | $ | 71,182 | $ | 229,221 | $ | 214,168 | ||||
| Cost of sales (exclusive of intangible amortization) | 35,387 | 32,652 | 109,944 | 99,700 | ||||||||
| Gross profit | 38,583 | 38,530 | 119,277 | 114,468 | ||||||||
| % of net sales | 52.2 | % | 54.1 | % | 52.0 | % | 53.4 | % | ||||
| Operating expenses | ||||||||||||
| Research and development | 7,280 | 8,565 | 22,873 | 27,286 | ||||||||
| Sales and marketing | 20,416 | 19,607 | 68,468 | 57,486 | ||||||||
| General and administrative | 8,727 | 9,011 | 27,348 | 26,787 | ||||||||
| Amortization of intangibles | 4,895 | 4,292 | 14,605 | 13,838 | ||||||||
| Change in fair value of contingent consideration | 201 | 183 | 1,005 | (290 | ) | |||||||
| Acquisition, restructuring and other items, net | 2,359 | 610 | 7,052 | 3,057 | ||||||||
| Total operating expenses | 43,878 | 42,268 | 141,351 | 128,164 | ||||||||
| Operating loss | (5,295 | ) | (3,738 | ) | (22,074 | ) | (13,696 | ) | ||||
| Interest expense, net | (173 | ) | (226 | ) | (503 | ) | (676 | ) | ||||
| Other income (expense), net | (289 | ) | (163 | ) | (651 | ) | 259 | |||||
| Total other expense, net | (462 | ) | (389 | ) | (1,154 | ) | (417 | ) | ||||
| Loss before income tax benefit | (5,757 | ) | (4,127 | ) | (23,228 | ) | (14,113 | ) | ||||
| Income tax benefit | (799 | ) | (583 | ) | (2,947 | ) | (2,033 | ) | ||||
| Net loss | $ | (4,958 | ) | $ | (3,544 | ) | $ | (20,281 | ) | $ | (12,080 | ) |
| Loss per share | ||||||||||||
| Basic | $ | (0.13 | ) | $ | (0.09 | ) | $ | (0.52 | ) | $ | (0.32 | ) |
| Diluted | $ | (0.13 | ) | $ | (0.09 | ) | $ | (0.52 | ) | $ | (0.32 | ) |
| Weighted average shares outstanding | ||||||||||||
| Basic | 39,092 | 38,360 | 38,959 | 38,281 | ||||||||
| Diluted | 39,092 | 38,360 | 38,959 | 38,281 |
| ANGIODYNAMICS, INC. AND SUBSIDIARIES | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| GAAP TO NON-GAAP RECONCILIATION | ||||||||||||
| (in thousands, except per share data) | ||||||||||||
| Reconciliation of Net Loss to non-GAAP Adjusted Net Income (Loss): | ||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Three Months Ended | Nine Months Ended | |||||||||||
| Feb 28, 2022 | Feb 28, 2021 | Feb 28, 2022 | Feb 28, 2021 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Net loss | $ | (4,958 | ) | $ | (3,544 | ) | $ | (20,281 | ) | $ | (12,080 | ) |
| Amortization of intangibles | 4,895 | 4,292 | 14,605 | 13,838 | ||||||||
| Change in fair value of contingent consideration | 201 | 183 | 1,005 | (290 | ) | |||||||
| Acquisition, restructuring and other items, net (1) | 2,359 | 610 | 7,052 | 3,057 | ||||||||
| Tax effect of non-GAAP items (2) | (1,190 | ) | (803 | ) | (2,817 | ) | (2,606 | ) | ||||
| Adjusted net income (loss) | $ | 1,307 | $ | 738 | $ | (436 | ) | $ | 1,919 | |||
| Reconciliation of Diluted Loss Per Share to non-GAAP Adjusted Diluted Earnings (Loss) Per Share: | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| Feb 28, 2022 | Feb 28, 2021 | Feb 28, 2022 | Feb 28, 2021 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Diluted loss per share | $ | (0.13 | ) | $ | (0.09 | ) | $ | (0.52 | ) | $ | (0.32 | ) |
| Amortization of intangibles | 0.12 | 0.11 | 0.37 | 0.36 | ||||||||
| Change in fair value of contingent consideration | — | — | 0.03 | (0.01 | ) | |||||||
| Acquisition, restructuring and other items, net (1) | 0.07 | 0.02 | 0.18 | 0.08 | ||||||||
| Tax effect of non-GAAP items (2) | (0.03 | ) | (0.02 | ) | (0.07 | ) | (0.06 | ) | ||||
| Adjusted diluted earnings (loss) per share | $ | 0.03 | $ | 0.02 | $ | (0.01 | ) | $ | 0.05 | |||
| Adjusted diluted sharecount (3) | 40,280 | 39,271 | 38,959 | 38,770 | ||||||||
| (1) Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and<br> write-offs, certain litigation, and other items. | ||||||||||||
| --- | ||||||||||||
| (2) 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<br> tax assets and an effective tax rate of 23% for the periods ended February 28, 2022 and 2021. | ||||||||||||
| (3) Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP loss. |
| 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 28, 2022 | Feb 28, 2021 | Feb 28, 2022 | Feb 28, 2021 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Net loss | $ | (4,958 | ) | $ | (3,544 | ) | $ | (20,281 | ) | $ | (12,080 | ) |
| Income tax benefit | (799 | ) | (583 | ) | (2,947 | ) | (2,033 | ) | ||||
| Interest expense, net | 173 | 226 | 503 | 676 | ||||||||
| Depreciation and amortization | 7,367 | 6,340 | 21,566 | 19,276 | ||||||||
| Change in fair value of contingent consideration | 201 | 183 | 1,005 | (290 | ) | |||||||
| Stock based compensation | 2,352 | 2,147 | 7,789 | 6,398 | ||||||||
| Acquisition, restructuring and other items, net ^(1)^ | 2,359 | 610 | 7,052 | 3,057 | ||||||||
| Adjusted EBITDA | $ | 6,695 | $ | 5,379 | $ | 14,687 | $ | 15,004 | ||||
| Per diluted share: | ||||||||||||
| Adjusted EBITDA | $ | 0.17 | $ | 0.14 | $ | 0.38 | $ | 0.39 | ||||
| (1) Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and<br> write-offs, certain litigation, and other items. | ||||||||||||
| --- |
| ANGIODYNAMICS, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY | ||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Feb 28, 2022 | Feb 28, 2021 | % Growth | Currency Impact | Constant Currency Growth | Feb 28, 2022 | Feb 28, 2021 | % Growth | Currency Impact | Constant Currency Growth | |||||||||||||||||
| (unaudited) | (unaudited) | |||||||||||||||||||||||||
| Net Sales | ||||||||||||||||||||||||||
| Med Tech | $ | 19,612 | $ | 15,246 | 28.6 | % | $ | 56,117 | $ | 39,581 | 41.8 | % | ||||||||||||||
| Med Device | 54,358 | 55,936 | (2.8 | )% | 173,104 | 174,587 | (0.8 | )% | ||||||||||||||||||
| $ | 73,970 | $ | 71,182 | 3.9 | % | (0.1 | )% | 3.8 | % | $ | 229,221 | $ | 214,168 | 7.0 | % | 0.2 | % | 7.2 | % | |||||||
| Net Sales by Product Category | ||||||||||||||||||||||||||
| Endovascular Therapies | $ | 38,083 | $ | 33,251 | 14.5 | % | $ | 115,799 | $ | 97,008 | 19.4 | % | ||||||||||||||
| Vascular Access | 23,431 | 24,813 | (5.6 | )% | 73,459 | 76,848 | (4.4 | )% | ||||||||||||||||||
| Oncology | 12,456 | 13,118 | (5.0 | )% | 39,963 | 40,312 | (0.9 | )% | ||||||||||||||||||
| $ | 73,970 | $ | 71,182 | 3.9 | % | (0.1 | )% | 3.8 | % | $ | 229,221 | $ | 214,168 | 7.0 | % | 0.2 | % | 7.2 | % | |||||||
| — | — | |||||||||||||||||||||||||
| Net Sales by Geography | ||||||||||||||||||||||||||
| United States | $ | 62,445 | $ | 58,654 | 6.5 | % | $ | 192,259 | $ | 173,446 | 10.8 | % | ||||||||||||||
| International | 11,525 | 12,528 | (8.0 | )% | (1.0 | )% | (9.0 | )% | 36,962 | 40,722 | (9.2 | )% | 1.1 | % | (8.1 | )% | ||||||||||
| $ | 73,970 | $ | 71,182 | 3.9 | % | (0.1 | )% | 3.8 | % | $ | 229,221 | $ | 214,168 | 7.0 | % | 0.2 | % | 7.2 | % |
| ANGIODYNAMICS, INC. AND SUBSIDIARIES | ||||
|---|---|---|---|---|
| CONSOLIDATED BALANCE SHEETS | ||||
| (in thousands) | ||||
| Feb 28, 2022 | May 31, 2021 | |||
| --- | --- | --- | --- | --- |
| (unaudited) | (audited) | |||
| Assets | ||||
| Current assets: | ||||
| Cash and cash equivalents | $ | 23,890 | $ | 48,161 |
| Accounts receivable, net | 41,810 | 35,405 | ||
| Inventories | 48,039 | 48,614 | ||
| Prepaid expenses and other | 13,947 | 8,699 | ||
| Total current assets | 127,686 | 140,879 | ||
| Property, plant and equipment, net | 43,594 | 37,073 | ||
| Other assets | 11,309 | 13,193 | ||
| Intangible assets, net | 159,105 | 168,977 | ||
| Goodwill | 201,484 | 201,316 | ||
| Total assets | $ | 543,178 | $ | 561,438 |
| Liabilities and stockholders' equity | ||||
| Current liabilities: | ||||
| Accounts payable | $ | 21,570 | $ | 19,630 |
| Accrued liabilities | 25,196 | 35,459 | ||
| Other current liabilities | 2,602 | 2,495 | ||
| Total current liabilities | 49,368 | 57,584 | ||
| Long-term debt | 25,000 | 20,000 | ||
| Deferred income taxes | 16,961 | 19,955 | ||
| Contingent consideration | 16,741 | 15,741 | ||
| Other long-term liabilities | 5,416 | 8,701 | ||
| Total liabilities | 113,486 | 121,981 | ||
| Stockholders' equity | 429,692 | 439,457 | ||
| Total Liabilities and Stockholders' Equity | $ | 543,178 | $ | 561,438 |
| ANGIODYNAMICS, INC. AND SUBSIDIARIES | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||
| (in thousands) | ||||||||||||
| Three Months Ended | Nine Months Ended | |||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Feb 28, 2022 | Feb 28, 2021 | Feb 28, 2022 | Feb 28, 2021 | |||||||||
| (unaudited) | (unaudited) | |||||||||||
| Cash flows from operating activities: | ||||||||||||
| Net loss | $ | (4,958 | ) | $ | (3,544 | ) | $ | (20,281 | ) | $ | (12,080 | ) |
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||||||||
| Depreciation and amortization | 7,406 | 6,379 | 21,682 | 19,392 | ||||||||
| Non-cash lease expense | 613 | 595 | 1,822 | 1,860 | ||||||||
| Stock based compensation | 2,352 | 2,147 | 7,789 | 6,398 | ||||||||
| Change in fair value of contingent consideration | 201 | 183 | 1,005 | (290 | ) | |||||||
| Deferred income taxes | (862 | ) | (634 | ) | (3,121 | ) | (2,187 | ) | ||||
| Change in accounts receivable allowances | (82 | ) | 2 | (66 | ) | 31 | ||||||
| Fixed and intangible asset impairments and disposals | 148 | 10 | 245 | 190 | ||||||||
| Other | 51 | 81 | (27 | ) | (149 | ) | ||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Accounts receivable | (3,519 | ) | 458 | (6,441 | ) | (1,823 | ) | |||||
| Inventories | 110 | 591 | 588 | 11,119 | ||||||||
| Prepaid expenses and other | (2,963 | ) | (2,498 | ) | (7,147 | ) | (8,821 | ) | ||||
| Accounts payable, accrued and other liabilities | (7,288 | ) | 2,101 | (11,802 | ) | (1,746 | ) | |||||
| Net cash (used in) provided by operating activities | (8,791 | ) | 5,871 | (15,754 | ) | 11,894 | ||||||
| Cash flows from investing activities: | ||||||||||||
| Additions to property, plant and equipment | (1,106 | ) | (1,382 | ) | (3,258 | ) | (4,567 | ) | ||||
| Additions to placement and evaluation units | (1,487 | ) | — | (8,676 | ) | — | ||||||
| Cash paid in acquisition | — | — | (3,600 | ) | — | |||||||
| Net cash used in investing activities | (2,593 | ) | (1,382 | ) | (15,534 | ) | (4,567 | ) | ||||
| Cash flows from financing activities: | ||||||||||||
| Proceeds from borrowings on long-term debt | — | — | 5,000 | — | ||||||||
| Repayment of long-term debt | — | (10,000 | ) | — | (10,000 | ) | ||||||
| Proceeds from exercise of stock options and employee stock purchase plan | 966 | 1,978 | 2,354 | 2,459 | ||||||||
| Net cash provided by (used in) financing activities | 966 | (8,022 | ) | 7,354 | (7,541 | ) | ||||||
| Effect of exchange rate changes on cash and cash equivalents | 17 | (23 | ) | (337 | ) | 248 | ||||||
| (Decrease) increase in cash and cash equivalents | (10,401 | ) | (3,556 | ) | (24,271 | ) | 34 | |||||
| Cash and cash equivalents at beginning of period | 34,291 | 58,025 | 48,161 | 54,435 | ||||||||
| Cash and cash equivalents at end of period | $ | 23,890 | $ | 54,469 | $ | 23,890 | $ | 54,469 |
Exhibit 99.2
ANGIODYNAMICS Third Quarter 2022 Earnings PresentationApril 7, 2022 1
2 Forward-Looking Statement Notice Regarding Forward-Looking StatementsThis 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, 2021. 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 MeasuresManagement 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 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.
Corporate Developments – Q3 and YTD Highlights 3 Continued focused investment in our 3 key Med Tech platforms: Auryon, Thrombectomy & NanoKnife Revised FY2021 Guidance 3 FY22 Guidance Revenue(unchanged) Adjusted EPS(unchanged) Gross Margin(unchanged) $310 - $315 million COVID-19 related headwinds persist Gross margin impacted by supply chain disruptions, labor shortages and inflation Procedural volume pressures particularly in December and JanuaryBacklog of $9.6 million at quarter end Company Q3 revenue growth of 3.9%Med Tech up 28.6%; Med Device down 2.8%$7.3 million in Auryon sales 13.7% YOY growth in Mechanical Thrombectomy11.2% YOY growth in NanoKnife disposables ($0.02) - $0.02 52% - 54% Company YTD revenue growth of 7.0%Med Tech up 41.8%; Med Device down 0.8% (excluding NHS, up 2.2%)$19.5 million in Auryon sales 18.3% YOY growth in Mechanical Thrombectomy16.9% YOY growth in NanoKnife disposables Subsequent to quarter end: The Company received FDA approval for its AlphaVac F18 thrombectomy system;The Company received FDA approval for its IDE study for the use of AlphaVac F18 to treat pulmonary embolism; and Enrolled first patients in the PRESERVE study for NanoKnife in prostate Manufacturing capacity enhancement initiatives drove a 20% increase in production hours exiting Q3
Third Quarter and YTD Highlights Q3 FY2022 Q3 FY2021 Change YTD FY2022 YTD FY2021 Change Revenue $73,970 $71,182 3.9% $229,221 $214,168 7.0% Gross Margin 52.2% 54.1% (190 bps) 52.0% 53.4% (140 bps) Net Loss ($4,958) ($3,544) ($1,414) ($20,281) ($12,080) ($8,201) GAAP EPS ($0.13) ($0.09) ($0.04) ($0.52) ($0.32) ($0.20) Adjusted EPS $0.03 $0.02 $0.01 ($0.01) $0.05 ($0.06) Adjusted EBITDA $6,695 $5,379 $1,316 $14,687 $15,004 ($317) Financial Performance$ in thousands (except per share data) 4
Third Quarter and YTD Highlights 5 Med Device Med Tech $10.5 $17.6 $59.7 $59.4 28.6% growth 2.8% decline Q3 Revenue Growth Q3 FY21 Q3 FY22 YTD Revenue Contribution Med Device Med Tech YTD FY21 YTD FY22 41.8% growth 0.8% decline Q3 Revenue Contribution YTD Revenue Growth 15.2 19.6 54.4
Third Quarter Highlights – Sales Growth Over Prior Periods Endovascular Therapies Q3 FY2022 YTD FY2022 Auryon 117% 199% Mechanical Thrombectomy* 14% 18% Thrombolytics (19%) (13%) Core Peripheral 2% 7% Venous Insufficiency 0% 0% Vascular Access Q3 FY2022 YTD FY2022 Midlines (11%) (21%) C3 8% 20% PICCs 0% (6%) Ports (6%) 8% Dialysis (11%) (6%) Oncology Q3 FY2022 YTD FY2022 NanoKnife® Capital (32%) (12%) NanoKnife® Disposables 11% 17% Solero® Microwave (6%) (6%) BioSentry (1%) 8% Alatus and IsoLoc Balloons 12% 3% RadioFrequency Ablation (19%) (14%) 6 Med Tech Q3 FY2022 YTD FY2022 Auryon* 117% 199% Thrombectomy** 7% 12% NanoKnife® Disposables 11% 17% NanoKnife® Capital (32%) (12%) Med Device Q3 FY2022 YTD FY2022 Solero® Microwave (6%) (6%) BioSentry (1%) 8% Core Peripheral 2% 7% Venous Insufficiency 0% 0% Alatus and IsoLoc Balloons 12% 3% RadioFrequency Ablation (19%) (14%) Midlines (11%) (21%) C3 8% 20% PICCs 0% (6%) Ports (6%) 8% Dialysis (11%) (6%) * The Auryon product was launched in Q2 of fiscal year 2021. ** Thrombectomy includes AngioVac, AlphaVac and Thrombolytics. * Mechanical thrombectomy includes AngioVac and AlphaVac.
Third Quarter and YTD FY2022 Results (unaudited) $ in thousands (except per share data) Q3 FY2022 Q3 FY2021 Change YTD FY2022 YTD FY2021 Change Revenue $73,970 $71,182 3.9% $229,221 $214,168 7.0% Med Tech Med Device $19,612$54,358 $15,246$55,936 28.6%(2.8%) $56,117$173,104 $39,581$174,587 41.8%(0.8%) Endovascular Therapies Vascular Access Oncology $38,083$23,431$12,456 $33,251$24,813$13,118 14.5%(5.6%)(5.0%) $115,799$73,459$39,963 $97,008$76,848$40,312 19.4%(4.4%)(0.9%) United States International $62,445$11,525 $58,654$12,528 6.5%(8.0%) $192,259$36,962 $173,446$40,722 10.8%(9.2%) Net LossNon-GAAP Adjusted Net Income (Loss) ($4,958)$1,307 ($3,544)$738 ($1,414)$569 ($20,281)($436) ($12,080)$1,919 ($8,201)($2,355) GAAP EPSNon-GAAP Adjusted EPS ($0.13)$0.03 ($0.09)$0.02 ($0.04)$0.01 ($0.52)($0.01) ($0.32)$0.05 ($0.20)($0.06) Gross Margin 52.2% 54.1% (190 bps) 52.0% 53.4% (140 bps) Adjusted EBITDA $6,695 $5,379 $1,316 $14,687 $15,004 ($317) $ in thousands Q3 FY2022 Q4 FY2021 Change Cash $23,890 $48,161 ($24,271) Debt $25,000 $20,000 $5,000 Net (Debt) Cash ($1,110) $28,161 ($29,271) 7
8 Third Quarter FY22 Gross Margin Bridge
GAAP to Non-GAAP Reconciliation 9
Reconciliation of GAAP to Non-GAAP Net Income (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. 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 28, 2022 and February 28, 2021.Diluted shares may differ for non-GAAP measures as compared to GAAP due to a GAAP loss. 10 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)