Conference Call Scheduled for Today, August
4, 2021, at 3:30 PM CT (4:30 PM ET)
- Revenues of $71.0 million increased 66.8% compared to fourth
quarter last year and increased 12.2% sequentially compared to
third quarter this year
- Fiscal 2021 revenues increased 9.5% to a record high $259
million
- Management provides fiscal 2022 revenue guidance of $295
million to $305 million, representing 14% to 18% growth
- Announced U.S. commercial launch of the WIRION® Embolic
Protection Device and the JADE® peripheral angioplasty balloon
catheters
Cardiovascular Systems, Inc. (CSI®) (NASDAQ:
CSII), a medical device company developing and commercializing
innovative interventional treatment systems for patients with
peripheral and coronary artery disease, today reported financial
results for its fiscal fourth quarter, ended June 30, 2021.
Executive Commentary – Scott Ward, Chairman, President and
CEO
“Strong execution with the addition of new customers and deeper
penetration of high volume cath labs combined with a decline in
COVID cases across the nation allowed CSI to drive higher
atherectomy volumes throughout the fourth quarter. As a result, we
achieved double-digit sequential revenue growth in both our U.S.
Peripheral and Coronary franchises.
“Our U.S. peripheral franchise delivered strong performance with
a solid rebound in our hospital business and continued momentum in
office-based labs. Revenue and units sold in both sites of service
increased at double-digit rates sequentially compared to third
quarter.
“The U.S. coronary franchise had another strong quarter with
sequential growth of 12% driven by new customers and increased
penetration of high-volume labs that focus on the treatment of
complex coronary artery disease.
“Despite the continued impact of COVID-19, international revenue
was stronger than expected at $3.7 million, with continued momentum
in Japan and Europe.
“The sustained improvement in the state of the U.S. healthcare
system combined with new product introductions and planned
international expansion position CSI to forecast revenue growth of
$295 million to $305 million in fiscal 22, representing growth of
14% to 18% compared to fiscal 21 revenue of $259 million.”
Q4 Financial Highlights
CSI’s fiscal 2021 fourth-quarter revenues were $71.0 million,
representing an increase of $28.4 million, or 66.8%. Gross profit
margin was 70.9% due to a one-time charge to cost of goods sold
related to inventory and production-related adjustments as well as
the normal upgrade of saline pumps that will be reaching end of
service.
Selling, general and administrative expenses were $45.7 million,
an increase of $10.7 million, or 30.7%, compared to the three
months ended June 30, 2020. Research and development expenses
decreased 21.9% to $9.2 million due to patent-related charges
incurred in the prior year period.
Fourth-quarter net loss of $5.3 million, or $0.14 per basic and
diluted share, compared favorably to net loss of $15.2 million, or
$0.43 per basic and diluted share, in the prior-year period.
Adjusted EBITDA was break-even, as compared to a loss of $10.6
million in the prior year.
Fiscal Year 2021 Financial Highlights
CSI’s fiscal year 2021 revenues were $259.0 million,
representing an increase of $22.4 million, or 9.5%. Gross profit
margin was 76.4%.
Selling, general and administrative expenses were $167.5
million, a decrease of $2.5 million, or 1.5%, compared to the year
ended June 30, 2020. Research and development expenses of $41.1
million decreased $2.3 million, or 5.3%.
Net loss of $13.4 million, or $0.35 per basic and diluted share,
compared favorably to net loss of $27.2 million, or $0.79 per basic
and diluted share, in the prior-year period. Adjusted EBITDA was
$12.0 million, as compared to a loss of $9.0 million in the prior
year.
As of June 30, 2021, CSI had cash and marketable securities
totaling $207.0 million and no long-term borrowings.
Fiscal Year 2022 Guidance
For the fiscal year 2022 ending June 30, 2022, CSI
anticipates:
- Revenue of $295 million to $305 million, representing revenue
growth of 14% to 18% compared to fiscal year 2021;
- Gross profit as a percentage of revenues of approximately
76%;
- Net loss in a range of 2% to 3% of revenues; and
- Adjusted EBITDA in a range of 6% to 8% of revenues.
Conference Call Scheduled for Today at 3:30 p.m. CT (4:30
p.m. ET)
CSI will host a live conference call and webcast of its fiscal
fourth-quarter results today, August 4, 2021, at 3:30 p.m. CT (4:30
p.m. ET). To participate in the conference call, please register
here. To access the live webcast, click events. A
webcast replay will be available beginning at 6:30 p.m. CT the same
day.
CSI Announces U.S. Commercial Launch of
JADE Over-the-Wire Non-Compliant Peripheral Balloon
Catheters
As previously announced on June 1st, the full line of
OrbusNeich® JADE® percutaneous transluminal angioplasty
over-the-wire balloon catheters is now available in the U.S.
New Study Demonstrates Exceptional
Performance With Diamondback 360® Coronary OAS Dual Mode of
Action
As previously announced on May 20th, results from a real-world
optical coherence tomography (OCT) imaging study of coronary OAS
patients were released at EuroPCR 2021.
About Peripheral Artery Disease (PAD)
As many as 18 million Americans, most over age 65, suffer from
PAD, which is caused by the accumulation of plaque in peripheral
arteries reducing blood flow. Symptoms include leg pain when
walking or at rest. Left untreated, PAD can lead to severe pain,
immobility, non-healing wounds and eventually limb amputation. With
risk factors such as diabetes and obesity on the rise, the
prevalence of PAD is growing at double-digit rates.
Millions of patients with PAD may benefit from treatment with
orbital atherectomy utilizing the Stealth 360® and Diamondback 360®
Peripheral Orbital Atherectomy Systems, minimally invasive catheter
systems developed and manufactured by CSI. These systems use a
diamond-coated crown, attached to an orbiting shaft, which sands
away plaque while preserving healthy vessel tissue — a critical
factor in preventing reoccurrences. Balloon angioplasty and stents
have significant shortcomings in treating hard, calcified lesions.
Stents are prone to fractures and high recurrence rates, and
treatment of hard, calcified lesions often leads to vessel damage
and suboptimal results.
About Coronary Artery Disease (CAD)
CAD is a life-threatening condition and a leading cause of death
in men and women globally. CAD occurs when a fatty material called
plaque builds up on the walls of arteries that supply blood to the
heart. The plaque buildup causes the arteries to harden and narrow
(atherosclerosis), reducing blood flow. The risk of CAD increases
if a person has one or more of the following: high blood pressure,
abnormal cholesterol levels, diabetes, or family history of early
heart disease. According to the American Heart Association, 16.3
million people in the United States have been diagnosed with CAD,
the most common form of heart disease. Heart disease claims more
than 600,000 lives in the United States each year. According to
estimates, significant arterial calcium is present in about 30
percent of patients undergoing a PCI. Significant calcium
contributes to poor stent delivery, expansion and wall apposition
leading to poor outcomes and higher treatment costs in coronary
interventions when traditional therapies are used, including a
significantly higher occurrence of death and major adverse cardiac
events (MACE).
About Cardiovascular Systems, Inc.
Cardiovascular Systems, Inc., based in St. Paul, Minn., is a
medical device company focused on developing and commercializing
innovative solutions for treating vascular and coronary disease.
The company’s orbital atherectomy system treats calcified and
fibrotic plaque in arterial vessels throughout the leg and heart
and addresses many of the limitations associated with existing
surgical, catheter and pharmacological treatment alternatives. For
additional information, please visit www.csi360.com and connect on
Twitter @csi360.
Safe Harbor
Certain statements in this news release are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995 and are provided under the protection of the
safe harbor for forward-looking statements provided by that Act.
For example, statements in this press release regarding (i) CSI’s
strategy and goals; (ii) our expectations regarding the sustained
improvement in the state of the U.S. healthcare system; (iii) new
product introductions; (iv) planned international expansion; (v)
anticipated revenue, gross profit, net loss and Adjusted EBITDA;
and (vi) anticipated upgrade of saline pumps, are forward-looking
statements. These statements involve risks and uncertainties that
could cause results to differ materially from those projected,
including, but not limited to, the ongoing COVID-19 pandemic and
the impact and scope thereof on CSI, our distribution partners, the
supply chain and physicians and facilities, including government
actions related to the COVID-19 outbreak, material delays and
cancellations of procedures, delayed spending by healthcare
providers, and distributor and supply chain disruptions; regulatory
developments, clearances and approvals; approval of our products
for distribution in countries outside of the United States;
approval of products for reimbursement and the level of
reimbursement in the U.S., Japan and other foreign countries;
dependence on market growth; agreements with third parties to sell
their products; the ability of us and our distribution partners to
successfully launch CSI products outside of the United States and
Japan; our ability to maintain third-party supplier relationships
and renew existing purchase agreements; our ability to maintain our
relationship with our distribution partners; the experience of
physicians regarding the effectiveness and reliability of the
products we sell; the reluctance of physicians, hospitals and other
organizations to accept new products; the potential for
unanticipated delays in enrolling medical centers and patients for
clinical trials; actual clinical trial and study results; the
impact of competitive products and pricing; unanticipated
developments affecting our estimates regarding expenses, future
revenues and capital requirements; the difficulty of successfully
managing operating costs; our ability to manage our sales force
strategy; our actual research and development efforts and needs,
including the timing of product development programs; our ability
to obtain and maintain intellectual property protection for product
candidates; our actual financial resources and our ability to
obtain additional financing; fluctuations in results and expenses
based on new product introductions, sales mix, unanticipated
warranty claims, and the timing of project expenditures; our
ability to manage costs; investigations or litigation threatened or
initiated against us; court rulings and future actions by the FDA
and other regulatory bodies; the effects of hurricanes, flooding,
and other natural disasters on our business; the impact of federal
corporate tax reform on our business, operations and financial
statements; international trade developments; shutdowns of the U.S.
federal government; general economic conditions; the potential
impact of any future strategic transactions; and other factors
detailed from time to time in CSI’s SEC reports, including its most
recent annual report on Form 10-K and subsequent quarterly reports
on Form 10-Q. CSI encourages you to consider all of these risks,
uncertainties and other factors carefully in evaluating the
forward-looking statements contained in this release. As a result
of these matters, changes in facts, assumptions not being realized
or other circumstances, CSI's actual results may differ materially
from the expected results discussed in the forward-looking
statements contained in this release. The forward-looking
statements made in this release are made only as of the date of
this release, and CSI undertakes no obligation to update them to
reflect subsequent events or circumstances.
Product Disclosures:
Peripheral Products
Indications: The Stealth 360® PAD System and Diamondback
360® PAD System are percutaneous orbital atherectomy systems (OAS)
indicated for use as therapy in patients with occlusive
atherosclerotic disease in peripheral arteries and stenotic
material from artificial arteriovenous dialysis fistulae.
Contraindications: The OAS are contraindicated for use in
coronary arteries, bypass grafts, stents or where thrombus or
dissections are present.
Warnings/Precautions: Although the incidence of adverse
events is rare, potential events that can occur with atherectomy
include: pain, hypotension, CVA/TIA, death, dissection,
perforation, distal embolization, thrombus formation, hematuria,
abrupt or acute vessel closure, or arterial spasm.
See the instructions for use for detailed information regarding
the procedure, indications, contraindications, warnings,
precautions, and potential adverse events. For further information
call CSI at 1-877-274-0901 and/or consult CSI’s website at
www.csi360.com.
Caution: Federal law (USA) restricts these devices to
sale by or on the order of a physician.
The Stealth 360® PAD System and Diamondback 360® PAD System
received FDA 510(k) clearance. The Stealth 360® PAD System is CE
Marked.
Coronary Product
Indications: The Diamondback 360® Coronary Orbital
Atherectomy System (OAS) is a percutaneous orbital atherectomy
system indicated to facilitate stent delivery in patients with
coronary artery disease (CAD) who are acceptable candidates for
PTCA or stenting due to de novo, severely calcified coronary artery
lesions.
Contraindications: The OAS is contraindicated when the
ViperWire® guide wire cannot pass across the coronary lesion or the
target lesion is within a bypass graft or stent. The OAS is
contraindicated when the patient is not an appropriate candidate
for bypass surgery, angioplasty, or atherectomy therapy, or has
angiographic evidence of thrombus, or has only one open vessel, or
has angiographic evidence of significant dissection at the
treatment site and for women who are pregnant or children.
Warnings/Precautions: Performing treatment in excessively
tortuous vessels or bifurcations may result in vessel damage; The
OAS was only evaluated in severely calcified lesions, A temporary
pacing lead may be necessary when treating lesions in the right
coronary and circumflex arteries; On-site surgical back-up should
be included as a clinical consideration; Use in patients with an
ejection fraction (EF) of less than 25% has not been evaluated.
See the instructions for use for detailed information regarding
the procedure, indications, contraindications, warnings,
precautions, and potential adverse events. For further information
call CSI at 1-877-274-0901 and/or consult CSI’s website at
www.csi360.com.
Caution: Federal law (USA) restricts these devices to
sale by or on the order of a physician.
The Diamondback 360® Coronary OAS is FDA PMA approved and CE
Marked.
Cardiovascular Systems,
Inc.
Consolidated Statements of
Operations
(Dollars in Thousands)
(unaudited)
Three Months Ended
Year Ended
June 30
June 30
2021
2020
2021
2020
Net revenues
$
70,987
$
42,546
$
258,973
$
236,545
Cost of goods sold
20,634
10,144
61,131
48,759
Gross profit
50,353
32,402
197,842
187,786
Expenses:
Selling, general and administrative
45,713
34,966
167,498
169,969
Research and development
9,245
11,840
41,061
43,355
Amortization of intangible assets
304
326
1,216
1,234
Total expenses
55,262
47,132
209,775
214,558
Loss from operations
(4,909
)
(14,730
)
(11,933
)
(26,772
)
Other (income) and expense, net
313
334
1,236
233
Loss before income taxes
(5,222
)
(15,064
)
(13,169
)
(27,005
)
Provision for income taxes
63
102
252
231
Net loss
$
(5,285
)
$
(15,166
)
$
(13,421
)
$
(27,236
)
Basic and diluted earnings per share
$
(0.14
)
$
(0.43
)
$
(0.35
)
$
(0.79
)
Basic and diluted weighted average shares
outstanding
38,926,490
35,021,360
38,832,002
34,275,957
Cardiovascular Systems,
Inc.
Consolidated Balance
Sheets
(Dollars in Thousands)
(unaudited)
June 30,
June 30,
2021
2020
ASSETS
Current assets
Cash and cash equivalents
$
71,070
$
185,463
Marketable securities
135,968
46,691
Accounts receivable, net
40,033
25,212
Inventories
32,313
27,706
Prepaid expenses and other current
assets
5,285
2,617
Total current assets
284,669
287,689
Property and equipment, net
28,894
27,810
Intangible assets, net
15,376
16,606
Other assets
23,628
7,414
Total assets
$
352,567
$
339,519
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities
Accounts payable
$
14,061
$
11,539
Accrued expenses
38,189
31,100
Deferred revenue
2,400
1,867
Total current liabilities
54,650
44,506
Long-term liabilities
Financing obligation
20,596
20,818
Deferred revenue
2,194
4,707
Other liabilities
4,169
696
Total liabilities
81,609
70,727
Commitments and contingencies
—
—
Total stockholders’ equity
270,958
268,792
Total liabilities and stockholders’
equity
$
352,567
$
339,519
Non-GAAP Financial Measures
To supplement CSI's consolidated condensed financial statements
prepared in accordance with GAAP, CSI uses a non-GAAP financial
measure referred to as "Adjusted EBITDA" in this release.
Reconciliations of this non-GAAP measure to the most comparable
U.S. GAAP measure for the respective periods can be found in the
following tables. In addition, an explanation of the manner in
which CSI's management uses this measure to conduct and evaluate
its business, the economic substance behind management's decision
to use this measure, the substantive reasons why management
believes that this measure provides useful information to
investors, the material limitations associated with the use of this
measure and the manner in which management compensates for those
limitations is included following the reconciliation table.
Adjusted EBITDA
(Dollars in Thousands)
(unaudited)
Three Months Ended
Year Ended
June 30
June 30
2021
2020
2021
2020
Net loss
$
(5,285
)
$
(15,166
)
$
(13,421
)
$
(27,236
)
Less: Other (income) and expense, net
313
334
1,236
233
Less: Provision for income taxes
63
102
252
231
Loss from operations
(4,909
)
(14,730
)
(11,933
)
(26,772
)
Add: Stock-based compensation
3,742
3,143
16,230
13,612
Add: IPR&D charges
—
—
3,353
—
Add: Depreciation and amortization
1,169
1,027
4,312
4,179
Adjusted EBITDA
$
2
$
(10,560
)
$
11,962
$
(8,981
)
Use and Economic Substance of Non-GAAP Financial Measures
Used by CSI and Usefulness of Such Non-GAAP Financial Measures to
Investors
CSI uses Adjusted EBITDA as a supplemental measure of
performance and believes this measure facilitates operating
performance comparisons from period to period and company to
company by factoring out potential differences caused by
depreciation and amortization expense, stock-based compensation,
and in-process research and development (IPR&D) charges. CSI's
management uses Adjusted EBITDA to analyze the underlying trends in
CSI's business, assess the performance of CSI's core operations,
establish operational goals and forecasts that are used to allocate
resources and evaluate CSI's performance period over period and in
relation to its competitors' operating results. Additionally, CSI's
management is evaluated on the basis of Adjusted EBITDA when
determining achievement of their incentive compensation performance
targets.
CSI believes that presenting Adjusted EBITDA provides investors
greater transparency to the information used by CSI's management
for its financial and operational decision-making and allows
investors to see CSI's results "through the eyes" of management.
CSI also believes that providing this information better enables
CSI's investors to understand CSI's operating performance and
evaluate the methodology used by CSI's management to evaluate and
measure such performance.
The following is an explanation of each of the items that
management excluded from Adjusted EBITDA and the reasons for
excluding each of these individual items:
-- Stock-based compensation. CSI excludes stock-based
compensation expense from its non-GAAP financial measures primarily
because such expense, while constituting an ongoing and recurring
expense, is not an expense that requires cash settlement. CSI's
management also believes that excluding this item from CSI's
non-GAAP results is useful to investors to understand the
application of stock-based compensation guidance and its impact on
CSI's operational performance, liquidity and its ability to make
additional investments in the company, and it allows for greater
transparency to certain line items in CSI's financial
statements.
-- Depreciation and amortization expense. CSI excludes
depreciation and amortization expense from its non-GAAP financial
measures primarily because such expenses, while constituting
ongoing and recurring expenses, are not expenses that require cash
settlement and are not used by CSI's management to assess the core
profitability of CSI's business operations. CSI's management also
believes that excluding these items from CSI's non-GAAP results is
useful to investors to understand CSI's operational performance,
liquidity and its ability to make additional investments in the
company.
-- IPR&D charges incurred in connection with asset
acquisitions. CSI excludes charges incurred in connection with
acquired IPR&D in asset acquisitions from its non-GAAP
financial measures given the one-time nature of such expense, which
is not used by CSI’s management to assess the core profitability of
its business operations.
Material Limitations Associated with the Use of Non-GAAP
Financial Measures and Manner in which CSI Compensates for these
Limitations
Non-GAAP financial measures have limitations as analytical tools
and should not be considered in isolation or as a substitute for
CSI's financial results prepared in accordance with GAAP. Some of
the limitations associated with CSI's use of these non-GAAP
financial measures are:
-- Items such as stock-based compensation do not directly affect
CSI's cash flow position; however, such items reflect economic
costs to CSI and are not reflected in CSI's "Adjusted EBITDA" and
therefore these non-GAAP measures do not reflect the full economic
effect of these items.
-- Non-GAAP financial measures are not based on any
comprehensive set of accounting rules or principles and therefore
other companies may calculate similarly titled non-GAAP financial
measures differently than CSI, limiting the usefulness of those
measures for comparative purposes.
-- CSI's management exercises judgment in determining which
types of charges or other items should be excluded from the
non-GAAP financial measures CSI uses. CSI compensates for these
limitations by relying primarily upon its GAAP results and using
non-GAAP financial measures only supplementally. CSI provides full
disclosure of each non-GAAP financial measure.
-- CSI provides detailed reconciliations of each non-GAAP
measure to its most directly comparable GAAP measure. CSI
encourages investors to review these reconciliations. CSI qualifies
its use of non-GAAP financial measures with cautionary statements
as set forth above.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210804005871/en/
Cardiovascular Systems, Inc. Jack Nielsen Vice President,
Investor Relations & Corporate Communications (651) 202-4919
j.nielsen@csi360.com
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