Inari Medical, Inc. (NASDAQ: NARI) (“Inari”), a medical device
company with a mission to treat and transform the lives of patients
suffering from venous and other diseases, today reported financial
results for its first quarter ended March 31, 2024.
First Quarter Financial and Recent Business
Highlights
- Generated revenue of $143.2 million in Q1 of 2024, up 23.3%
over the same quarter last year.
- GAAP operating loss was $17.2 million in Q1 of 2024, compared
to a $5.3 million operating loss in the same quarter of last
year.
- Non-GAAP operating loss was $5.6 million in Q1 of 2024,
compared to a $5.3 million non-GAAP operating loss in the same
quarter of last year.
“Our strong first quarter performance reflected crisp execution
across our three growth pillars, as we continued to drive adoption
of our highly differentiated, purpose-built toolkits across large,
attractive markets,” said Drew Hykes, CEO of Inari Medical. “We
also continued to grow our powerful commercial engine and invest in
high quality, market impacting clinical data, including our
PEERLESS study, which remains on track for presentation in the
second half of 2024. Lastly, we continue to deliver a premium
financial profile, characterized by best-in-class gross margin and
operating expense leverage, excluding deal-related costs. Taken
together, these efforts reflect our unwavering commitment to our
mission and addressing unmet patient needs.”
First Quarter 2024 Financial ResultsRevenue was
$143.2 million for the first quarter of 2024, up 23.3% compared to
$116.2 million for the first quarter of 2023. The increase over the
prior year quarter was driven primarily by increased adoption of
our procedures, new products, and global commercial expansion.
Gross profit was $124.3 million for the first quarter of 2024,
compared to $102.4 million for the first quarter of 2023. Gross
margin was 86.8% for the first quarter of 2024, compared to 88.2%
for the for the first quarter of 2023. The year-over-year change
was due increasing internationalization of the business, ramp up
costs associated with new products, and product mix.
Operating expenses for the first quarter of 2024 were $141.5
million, compared to $107.8 million for the first quarter of 2023.
The increase was mainly driven by personnel-related expenses,
including commissions and stock-based compensation associated with
increased headcount to fund the expansion of the commercial,
research and development, clinical, and support organizations;
change in fair value of the contingent consideration liability;
professional fees; and amortization expense related to an
intangible asset acquired in the LimFlow acquisition.
GAAP operating loss was $17.2 million in the first quarter of
2024, compared with a $5.3 million GAAP operating loss for the
first quarter of 2023.
Non-GAAP operating loss was $5.6 million in the first quarter of
2024. The following items were excluded from the non-GAAP operating
loss: change in fair value of contingent consideration liability of
$6.3 million, acquisition-related costs of $2.8 million, and
acquired intangible asset amortization of $2.5 million. There were
no non-GAAP adjustments related to the company’s operating loss for
the first quarter of 2023.
Net loss was $24.2 million for the first quarter of 2024 and net
loss per share was $0.42 on a weighted-average basic and diluted
share count of 57.9 million, compared to a net loss of $2.2 million
and a net loss per share of $0.04 on a weighted-average basic and
diluted share count of 54.8 million, in the same period of the
prior year.
Full Year 2024 Revenue Guidance and Operating Income
Outlook
- Inari expects full year 2024 revenue of $592.5 million to
$602.5 million, reflecting growth of approximately 20% to 22%
over 2023, and a raise versus the prior 2024 revenue guidance of
$580 million to $595 million.
- The company expects to reach sustained operating profitability
in the first half of 2025.
Webcast and Conference Call InformationInari
Medical will host a conference call to discuss the first quarter
2024 financial results after market close on April 30, 2024 at 1:30
p.m. Pacific Time / 4:30 p.m. Eastern Time. The conference call can
be accessed live by dialing (844) 825-9789 for domestic callers or
(412) 317-5180 for international callers. The live webinar and
presentation may be accessed by visiting the Events Section of the
Inari investor relations website at ir.inarimedical.com.
Use of Non-GAAP Financial MeasuresThis press
release contains references to non-GAAP operating income (loss),
which is considered a non-GAAP financial measure. This means that
non-GAAP operating income (loss) is determined by methods other
than in accordance with accounting principles generally accepted in
the United States (GAAP). As used by Inari, non-GAAP operating
income (loss) excludes from GAAP operating income (loss) the
following items: amortization of acquired intangible assets,
acquisition-related costs and fair value adjustment to our
contingent consideration liability. We present the non-GAAP
operating income (loss) to exclude these charges because we believe
these charges are significantly impacted by the timing and
valuation of acquisitions, such as our LimFlow acquisition
completed in the fourth quarter of 2023. Our management believes
the presentation of non-GAAP operating income (loss) is useful
because it provides meaningful comparisons to prior periods and
provides visibility to our underlying operating performance and an
additional means to evaluate the cost and expense trends excluding
the impact of these acquisition-related items, which are not
related to our core business operations.
Our definition of non-GAAP operating income (loss) may differ
from similarly titled measures used by others. Non-GAAP operating
income (loss) should be considered supplemental to, and not a
substitute for, financial information prepared in accordance with
GAAP. We encourage investors to review the reconciliation of
non-GAAP operating income (loss) to GAAP operating income (loss),
which has been provided in the financial statement tables included
in this press release.
About Inari Medical, Inc.Patients first. No
small plans. Take care of each other. These are the guiding
principles that form the ethos of Inari Medical. We are committed
to improving lives in extraordinary ways by creating innovative
solutions for both unmet and underserved health needs. In addition
to our purpose-built solutions, we leverage our capabilities in
education, clinical research, and program development to improve
patient outcomes. We are passionate about our mission to establish
our treatments as the standard of care for venous thromboembolism
and four other targeted disease states. We are just getting
started. Learn more at www.inarimedical.com and connect with us on
LinkedIn, X (Twitter), and Instagram.
Forward Looking StatementsStatements in this
press release may contain “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995
that are subject to substantial risks and uncertainties.
Forward-looking statements contained in this press release may be
identified by the use of words such as “may,” “will,” “should,”
“expect,” “plan,” “anticipate,” “could,” “intend,” “target,”
“project,” “contemplate,” “believe,” “estimate,” “predict,”
“potential” or “continue” or the negative of these terms or other
similar expressions. Forward-looking statements include
expectations regarding Inari’s core business, its ability to
integrate LimFlow, expectations regarding future growth, Inari's
ability to meet customers' needs, and timing for achieving
sustained operating profitability, and are based on Inari’s current
expectations, forecasts, and assumptions. Forward-looking
statements are subject to inherent uncertainties, risks and
assumptions that are difficult to predict, and actual outcomes and
results could differ materially due to a number of factors. These
and other risks and uncertainties include those described more
fully in the section titled “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operation” and elsewhere in its Annual Report on Form 10-K for the
period ended December 31, 2023, and in Inari’s other reports
filed with the U.S. Securities and Exchange Commission.
Forward-looking statements contained in this announcement are based
on information available to Inari as of the date hereof and are
made only as of the date of this release. Inari undertakes no
obligation to update such information except as required under
applicable law. These forward-looking statements should not be
relied upon as representing Inari’s views as of any date subsequent
to the date of this press release. In light of the foregoing,
investors are urged not to rely on any forward-looking statement in
reaching any conclusion or making any investment decision about any
securities of Inari.
Investor Contact:John Hsu, CFAVP, Investor
Relations949-658-3889IR@inarimedical.com
|
INARI MEDICAL, INC.Condensed Consolidated
Statements of Operations and Comprehensive Income
(Loss)(in thousands, except share and per share
data)(unaudited) |
| |
| |
Three Months Ended March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
Revenue |
$ |
143,194 |
|
|
$ |
116,167 |
|
| Cost of
goods sold |
|
18,893 |
|
|
|
13,741 |
|
| Gross
profit |
|
124,301 |
|
|
|
102,426 |
|
|
Operating expenses |
|
|
|
|
Research and development |
|
26,880 |
|
|
|
22,064 |
|
|
Selling, general and administrative |
|
103,055 |
|
|
|
85,700 |
|
|
Change in fair value of contingent consideration |
|
6,303 |
|
|
|
— |
|
|
Amortization of intangible asset |
|
2,461 |
|
|
|
— |
|
|
Acquisition-related expenses |
|
2,779 |
|
|
|
— |
|
|
Total operating expenses |
|
141,478 |
|
|
|
107,764 |
|
| Loss
from operations |
|
(17,177 |
) |
|
|
(5,338 |
) |
| Other
income (expense) |
|
|
|
|
Interest income |
|
1,191 |
|
|
|
4,145 |
|
|
Interest expense |
|
(78 |
) |
|
|
(40 |
) |
|
Other (expense) income |
|
(23 |
) |
|
|
39 |
|
|
Total other income |
|
1,090 |
|
|
|
4,144 |
|
| Loss
before income taxes |
|
(16,087 |
) |
|
|
(1,194 |
) |
|
Provision for income taxes |
|
8,115 |
|
|
|
1,024 |
|
| Net
loss |
$ |
(24,202 |
) |
|
$ |
(2,218 |
) |
| Other
comprehensive income (loss) |
|
|
|
|
Foreign currency translation adjustments |
|
(7,359 |
) |
|
|
9 |
|
|
Unrealized loss on available-for-sale debt securities |
|
(4 |
) |
|
|
(865 |
) |
| Total
other comprehensive loss |
|
(7,363 |
) |
|
|
(856 |
) |
|
Comprehensive loss |
$ |
(31,565 |
) |
|
$ |
(3,074 |
) |
| Net loss
per share |
|
|
|
|
Basic |
$ |
(0.42 |
) |
|
$ |
(0.04 |
) |
|
Diluted |
$ |
(0.42 |
) |
|
$ |
(0.04 |
) |
| Weighted average common shares
used to compute net loss per share |
|
|
|
|
Basic |
|
57,938,115 |
|
|
|
54,756,024 |
|
|
Diluted |
|
57,938,115 |
|
|
|
54,756,024 |
|
|
|
|
|
|
|
|
|
|
|
INARI MEDICAL, INC.Condensed Consolidated
Balance Sheets(in thousands, except share data and
par value)(unaudited) |
| |
| |
March 31,2024 |
|
December 31,2023 |
| Assets |
|
|
|
| Current
assets |
|
|
|
|
Cash and cash equivalents |
$ |
66,707 |
|
|
$ |
38,597 |
|
|
Restricted cash |
|
500 |
|
|
|
611 |
|
|
Short-term investments in debt securities |
|
34,595 |
|
|
|
76,855 |
|
|
Accounts receivable, net |
|
78,621 |
|
|
|
70,119 |
|
|
Inventories, net |
|
44,650 |
|
|
|
42,900 |
|
|
Prepaid expenses and other current assets |
|
8,240 |
|
|
|
6,481 |
|
|
Total current assets |
|
233,313 |
|
|
|
235,563 |
|
| Property and equipment,
net |
|
20,761 |
|
|
|
20,929 |
|
| Operating lease right-of-use
assets |
|
47,610 |
|
|
|
48,407 |
|
| Goodwill |
|
209,642 |
|
|
|
214,335 |
|
| Intangible assets |
|
145,774 |
|
|
|
150,884 |
|
| Deposits and other assets |
|
4,676 |
|
|
|
4,117 |
|
| Total
assets |
$ |
661,776 |
|
|
$ |
674,235 |
|
| Liabilities and
Stockholders' Equity |
|
|
|
| Current
liabilities |
|
|
|
|
Accounts payable |
$ |
12,026 |
|
|
$ |
10,577 |
|
|
Payroll-related accruals |
|
38,748 |
|
|
|
48,706 |
|
|
Accrued expenses and other current liabilities |
|
33,544 |
|
|
|
15,364 |
|
|
Operating lease liabilities, current portion |
|
1,719 |
|
|
|
1,692 |
|
|
Total current liabilities |
|
86,037 |
|
|
|
76,339 |
|
| Operating lease liabilities,
noncurrent portion |
|
29,773 |
|
|
|
30,355 |
|
| Deferred tax liability |
|
35,395 |
|
|
|
36,231 |
|
| Other long-term liability |
|
63,341 |
|
|
|
66,400 |
|
| Total
liabilities |
$ |
214,546 |
|
|
$ |
209,325 |
|
| Commitments and
contingencies (Note 9) |
|
|
|
| Stockholders'
equity |
|
|
|
|
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no
shares issued and outstanding as of March 31, 2024 and December 31,
2023 |
|
— |
|
|
|
— |
|
|
Common stock, $0.001 par value, 300,000,000 shares authorized as of
March 31, 2024, and December 31, 2023; 58,001,145 and 57,762,414
shares issued and outstanding as of March 31, 2024 and December 31,
2023, respectively |
|
58 |
|
|
|
58 |
|
|
Additional paid in capital |
|
518,338 |
|
|
|
504,453 |
|
|
Accumulated other comprehensive income |
|
1,522 |
|
|
|
8,885 |
|
|
Accumulated deficit |
|
(72,688 |
) |
|
|
(48,486 |
) |
| Total stockholders'
equity |
|
447,230 |
|
|
|
464,910 |
|
| Total liabilities and
stockholders' equity |
$ |
661,776 |
|
|
$ |
674,235 |
|
| |
|
|
|
|
|
|
|
|
INARI MEDICAL, INC.Reconciliation of GAAP
Operating Loss to Non-GAAP Operating Loss(in
thousands)(Unaudited) |
Reconciliation of GAAP Operating Loss to Non-GAAP
Operating Loss:
| |
Three Months Ended March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
|
GAAP Operating loss |
$ |
(17,177 |
) |
|
$ |
(5,338 |
) |
| Non-GAAP
Adjustments: |
|
|
|
|
Change in fair value of contingent consideration |
|
6,303 |
|
|
|
— |
|
|
Amortization of acquired intangible asset |
|
2,461 |
|
|
|
— |
|
|
Acquisition-related expenses (a) |
|
2,779 |
|
|
|
— |
|
| Non-GAAP
Operating loss |
$ |
(5,634 |
) |
|
$ |
(5,338 |
) |
________________(a) The acquisition-related
expenses primarily include integration and retention related
expenses.
The following table presents the amount of revenue in VTE and
Emerging Therapies recognized for the periods presented (in
thousands, unaudited):
|
|
Three Months Ended March 31, |
|
|
|
|
|
2024 |
|
|
|
2023 |
|
|
% Growth |
|
VTE |
$ |
137,193 |
|
|
$ |
114,058 |
|
|
|
20.3 |
% |
| Emerging
Therapies |
|
6,001 |
|
|
|
2,109 |
|
|
|
184.5 |
% |
|
Total Revenue |
$ |
143,194 |
|
|
$ |
116,167 |
|
|
|
23.3 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
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