AtriCure, Inc. (Nasdaq: ATRC), a leading innovator in treatments
for atrial fibrillation (Afib) and left atrial appendage (LAA)
management, today announced third quarter 2021 financial
results.
“Our results were driven by strong growth across key product
lines, including the addition of new Cryo Nerve Block and Hybrid
AF™ Therapy accounts, providing further validation of demand across
our business,” said Michael Carrel, President and Chief Executive
Officer of AtriCure. “We feel encouraged by our progress this
quarter and are well positioned to capitalize upon the recent
approval from the CONVERGE™ trial. I remain impressed with the
excellence our team delivers as they continue to execute against a
difficult backdrop as the impacts of the delta variant were felt
across the country.”
Third Quarter 2021 Financial
Results
Revenue for the third quarter 2021 was $70.5 million, an
increase of 28.7% (an increase of 28.6% on a constant currency
basis) over third quarter 2020 revenue. U.S. revenue was $57.5
million, an increase of $12.8 million or 28.7%, compared to third
quarter 2020 revenue. U.S. revenue reflected healthy growth across
all product lines as conditions improved from 2020 as a result of
stabilizing cardiac surgery procedure volumes and increasing demand
for our Cryo Nerve Block and Hybrid AF therapy products.
International revenue increased $2.9 million or 28.5% (an increase
of 27.9% on a constant currency basis) to $12.9 million, reflecting
rebounding activity and growth in most major markets and across
product lines. On a sequential basis, worldwide revenue for the
third quarter 2021 decreased approximately 1.3% over second quarter
2021.
Gross profit for the third quarter 2021 was $52.2 million
compared to $40.3 million for the third quarter 2020. Gross margin
was 74.1% and 73.7% for the third quarters 2021 and 2020
respectively, reflecting a favorable product mix.
Income from operations for the third quarter 2021 was $98.7
million, compared to a loss from operations of $4.0 million for the
third quarter 2020. Third quarter 2021 income from operations
includes a $189.9 million credit to operating expenses for the
change in fair value of contingent consideration, offset partially
by a $82.3 million intangible asset impairment charge for the
IPR&D asset associated with the aMAZE™ trial. Basic and diluted
net income per share was $2.15 and $2.11, respectively, for the
third quarter 2021, compared to basic and diluted loss per share of
$0.11 for the third quarter 2020.
Adjusted EBITDA was positive for the third quarters 2021 and
2020, at $0.7 million and $4.2 million, respectively. Adjusted loss
per share for the third quarter 2021 was $0.23 compared to $0.11
for the third quarter 2020.
Constant currency revenue, adjusted EBITDA and adjusted loss per
share are non-GAAP measures. We discuss these non-GAAP measures and
provide reconciliations to GAAP measures later in this release.
2021 Financial Guidance
Management is maintaining revenue guidance for full year 2021 at
a range of $270 to $275 million, corresponding to growth of
approximately 31% to 33% for the year. As with previous guidance,
continued uncertainty relating to the dynamic environment with the
COVID-19 pandemic could materially impact this projection. The
Company is also maintaining guidance for full year 2021 adjusted
EBITDA loss of approximately $10 million and an adjusted loss per
share of approximately $1.20.
Conference Call
AtriCure will host a conference call at 4:30 p.m. Eastern Time
on Wednesday, November 3, 2021 to discuss its third quarter 2021
financial results. The call may be accessed through an operator by
calling (844) 884-9951 for domestic callers and (661) 378-9661 for
international callers using conference ID number 5139213. A live
audio webcast of the presentation may be accessed by visiting the
Investors page of AtriCure’s corporate website at ir.atricure.com.
A replay of the presentation will be available for 90 days
following the presentation.
About AtriCure
AtriCure, Inc. provides innovative technologies for the
treatment of Afib and related conditions. Afib affects more than 33
million people worldwide. Electrophysiologists and cardiothoracic
surgeons around the globe use AtriCure technologies for the
treatment of Afib and reduction of Afib related complications.
AtriCure’s Isolator® Synergy™ Ablation System is the first medical
device to receive FDA approval for the treatment of persistent
Afib. AtriCure’s AtriClip Left Atrial Appendage Exclusion System
products are the most widely sold LAA management devices worldwide.
AtriCure’s Hybrid AF™ Therapy is a minimally invasive procedure
that provides a lasting solution for long-standing persistent Afib
patients. AtriCure’s cryoICE cryoSPHERE® probe is cleared for
temporary ablation of peripheral nerves to block pain, providing
pain relief in cardiac and thoracic procedures. For more
information, visit AtriCure.com or follow us on Twitter @AtriCure.
The information contained on our website, Twitter or any other
third-party website is not incorporated by reference in this
earnings release.
Forward-Looking Statements
This press release contains “forward-looking statements”– that
is, statements related to future events that by their nature
address matters that are uncertain. This press release also
includes forward-looking projected financial information that is
based on current estimates and forecasts. Actual results could
differ materially. For details on the uncertainties that may cause
our actual results to be materially different than those expressed
in our forward-looking statements, visit
http://www.atricure.com/fls as well as our Annual Reports on Form
10-K and Quarterly Reports on Form 10-Q which contain risk factors.
Except where otherwise noted, the information contained in this
release and the related attachment is as of November 3, 2021. We
assume no obligation to update any forward-looking statements
contained in this release and the related attachment as a result of
new information or future events or developments.
Use of Non-GAAP Financial Measures
To supplement AtriCure’s condensed consolidated financial
statements prepared in accordance with accounting principles
generally accepted in the United States of America, or GAAP,
AtriCure provides certain non-GAAP financial measures in this
release as supplemental financial metrics.
Revenue reported on a constant currency basis is a non-GAAP
measure, calculated by applying previous period foreign currency
exchange rates, which are determined by the average daily Euro to
Dollar exchange rate, to each of the comparable periods. Management
analyzes revenue on a constant currency basis to better measure the
comparability of results between periods. Because changes in
foreign currency exchange rates have a non-operating impact on
revenue, the Company believes that evaluating growth in revenue on
a constant currency basis provides an additional and meaningful
assessment of revenue to both management and investors.
Adjusted EBITDA is calculated as net income (loss) before other
income/expense (including interest), income tax expense,
depreciation and amortization expense, share-based compensation
expense, acquisition costs, legal settlement costs, impairment of
intangible asset, and change in fair value of contingent
consideration liabilities. Due to the nonrecurring nature of the
third quarter 2021 impairment of an intangible asset, the Company
has modified the calculation of adjusted EBITDA to exclude
impairment charges. The impairment of intangible asset reflects the
one-time charge recognized by the Company as a result of the impact
of aMAZE trial results on the related IPR&D asset. The Company
believes it is now appropriate to modify the calculation of
adjusted EBITDA to exclude impairment of intangible asset because
the Company has concluded that such adjustment is generally
nonrecurring and is not reflective of the operational results of
the Company’s core business. The Company also believes this
approach is more comparable to peer company reporting.
Management believes in order to properly understand short-term
and long-term financial trends, investors may wish to consider the
impact of these excluded items in addition to GAAP measures. The
excluded items vary in frequency and/or impact on our continuing
results of operations and management believes that the excluded
items are typically not reflective of our ongoing core business
operations and financial condition. Further, management uses
adjusted EBITDA for both strategic and annual operating planning. A
reconciliation of adjusted EBITDA reported in this release to the
most comparable GAAP measure for the respective periods appears in
the table captioned “Reconciliation of Non-GAAP Adjusted Income
(Loss) (Adjusted EBITDA)” later in this release.
Adjusted income (loss) per share is a non-GAAP measure which
calculates the net income (loss) per share before non-cash
adjustments in fair value of contingent consideration liabilities
and impairment of intangible asset. Due to the nonrecurring nature
of the impairment of intangible asset, the Company believes it is
now appropriate to modify the calculation of adjusted income (loss)
per share to exclude such amount. A reconciliation of adjusted
income (loss) per share reported in this release to the most
comparable GAAP measure for the respective periods appears in the
table captioned “Reconciliation of Non-GAAP Adjusted Income (Loss)
Per Share” later in this release.
The non-GAAP financial measures used by AtriCure may not be the
same or calculated in the same manner as those used and calculated
by other companies. Non-GAAP financial measures have limitations as
analytical tools and should not be considered in isolation or as a
substitute for AtriCure’s financial results prepared and reported
in accordance with GAAP. We urge investors to review the
reconciliation of these non-GAAP financial measures to the
comparable GAAP financials measures included in this press release,
and not to rely on any single financial measure to evaluate our
business.
ATRICURE, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In Thousands, Except Per
Share Amounts)
(Unaudited)
Three Months Ended
September 30,
Nine Months Ended
September 30,
2021
2020
2021
2020
United States Revenue:
Open ablation
$
23,779
$
19,911
$
69,693
$
54,679
Minimally invasive ablation
9,990
6,979
28,077
18,295
Appendage management
23,401
17,430
69,144
47,870
Total ablation and appendage
management
57,170
44,320
166,914
120,844
Valve tools
367
381
1,002
994
Total United States
57,537
44,701
167,916
121,838
International Revenue:
Open ablation
6,699
4,907
16,629
13,766
Minimally invasive ablation
1,849
1,692
4,698
4,346
Appendage management
4,373
3,445
11,825
8,778
Total ablation and appendage
management
12,921
10,044
33,152
26,890
Valve tools
2
12
43
78
Total international
12,923
10,056
33,195
26,968
Total revenue
70,460
54,757
201,111
148,806
Cost of revenue
18,234
14,423
50,267
41,934
Gross profit
52,226
40,334
150,844
106,872
Operating (benefit) expenses:
Research and development expenses
11,284
10,576
34,698
32,199
Selling, general and administrative
expenses
49,873
33,557
150,939
106,257
Change in fair value of contingent
consideration
(189,900
)
192
(184,800
)
(4,854
)
Intangible asset impairment
82,300
—
82,300
—
Total operating (benefit) expenses
(46,443
)
44,325
83,137
133,602
Income (loss) from operations
98,669
(3,991
)
67,707
(26,730
)
Other expense, net
(1,523
)
(962
)
(3,632
)
(2,847
)
Income (loss) before income tax
expense
97,146
(4,953
)
64,075
(29,577
)
Income tax expense (benefit)
38
(4
)
135
16
Net income (loss)
$
97,108
$
(4,949
)
$
63,940
$
(29,593
)
Basic net income (loss) per share
$
2.15
$
(0.11
)
$
1.42
$
(0.71
)
Diluted net income (loss) per share
$
2.11
$
(0.11
)
$
1.39
$
(0.71
)
Weighted average shares used in computing
net income (loss) per share:
Basic
45,258
44,012
44,977
41,442
Diluted
46,100
44,012
45,996
41,442
ATRICURE, INC. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In Thousands)
(Unaudited)
September 30,
2021
December 31,
2020
Assets
Current assets:
Cash, cash equivalents, and short-term
investments
$
119,746
$
244,218
Accounts receivable, net
33,498
23,146
Inventories
38,587
35,026
Prepaid and other current assets
3,876
4,347
Total current assets
195,707
306,737
Property and equipment, net
29,901
28,290
Operating lease right-of-use assets
2,465
1,914
Long-term investments
105,097
14,178
Goodwill and intangible assets, net
278,744
362,980
Other noncurrent assets
1,055
440
Total assets
$
612,969
$
714,539
Liabilities and Stockholders'
Equity
Current liabilities:
Accounts payable and accrued
liabilities
$
49,373
$
40,720
Other current liabilities and current
maturities of debt and leases
4,581
8,417
Total current liabilities
53,954
49,137
Long-term debt
56,354
53,435
Finance lease liabilities
10,317
10,969
Operating lease liabilities
1,593
1,180
Contingent consideration and other
noncurrent liabilities
2,282
187,424
Total liabilities
124,500
302,145
Stockholders' equity:
Common stock
46
45
Additional paid-in capital
755,048
742,389
Accumulated other comprehensive (loss)
income
(213
)
312
Accumulated deficit
(266,412
)
(330,352
)
Total stockholders' equity
488,469
412,394
Total liabilities and stockholders'
equity
$
612,969
$
714,539
ATRICURE, INC. AND
SUBSIDIARIES
RECONCILIATION OF GAAP RESULTS
TO NON-GAAP RESULTS
(In Thousands)
(Unaudited)
Reconciliation of Non-GAAP Adjusted
Income (Loss) (Adjusted EBITDA)
Three Months Ended September
30,
Nine Months Ended September
30,
2021
2020
2021
2020
Net income (loss), as reported
$
97,108
$
(4,949
)
$
63,940
$
(29,593
)
Income tax expense (benefit)
38
(4
)
135
16
Other expense, net
1,523
962
3,632
2,847
Depreciation and amortization expense
2,828
2,479
7,608
7,381
Share-based compensation expense
6,794
5,549
20,539
16,126
Change in fair value of contingent
consideration
(189,900
)
192
(184,800
)
(4,854
)
Intangible asset impairment
82,300
—
82,300
—
Acquisition costs
—
—
—
138
Non-GAAP adjusted income (loss) (adjusted
EBITDA)
$
691
$
4,229
$
(6,646
)
$
(7,939
)
Reconciliation of Non-GAAP Adjusted
Loss Per Share
Three Months Ended September
30,
Nine Months Ended September
30,
2021
2020
2021
2020
Net income (loss), as reported
$
97,108
$
(4,949
)
$
63,940
$
(29,593
)
Change in fair value of contingent
consideration
(189,900
)
192
(184,800
)
(4,854
)
Intangible asset impairment
82,300
—
82,300
—
Non-GAAP adjusted net loss
$
(10,492
)
$
(4,757
)
$
(38,560
)
$
(34,447
)
Basic and diluted adjusted net loss per
share
$
(0.23
)
$
(0.11
)
$
(0.86
)
$
(0.83
)
Weighted average shares used in computing
adjusted net loss per share
Basic and diluted
45,258
44,012
44,977
41,442
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211103006056/en/
Angie Wirick AtriCure, Inc. Chief Financial Officer (513)
755-5334 awirick@atricure.com Lynn Pieper Lewis Gilmartin Group
Investor Relations (415) 937-5402 lynn@gilmartinir.com
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