Artivion(AORT) - 2024 Q3 - Quarterly Report

Revenue Performance - Artivion reported quarterly revenues of $95.8 million for the three months ended September 30, 2024, representing a 9$87.9 million in the same period of 2023[107]. - Revenues from aortic stent grafts increased by 12% to $28.6 million for the three months ended September 30, 2024, compared to$25.5 million in 2023[113]. - On-X product revenues rose by 15% to $21.5 million for the three months ended September 30, 2024, up from$18.7 million in the prior year[113]. - Surgical sealants revenues increased by 14% to $18.4 million for the three months ended September 30, 2024, compared to$16.2 million in 2023[113]. - Constant currency revenues increased by 10% for the three months ended September 30, 2024, compared to the same period in 2023[120]. - Total revenues for the nine months ended September 30, 2024, were $291.2 million, a 12$260.3 million in the same period of 2023[114]. - Preservation services revenues increased by 11% to $75.7 million for the nine months ended September 30, 2024, compared to$68.3 million in 2023[114]. - Aortic stent grafts accounted for 32% of total revenues for the nine months ended September 30, 2024[114]. Cost and Expenses - Cost of products increased 13% for the three months ended September 30, 2024, compared to the same period in 2023, driven by an increase in the volume of all products shipped[144]. - General, administrative, and marketing expenses decreased 2% for the three months ended September 30, 2024, compared to the same period in 2023, primarily due to a decrease in business development expenses[151]. - Research and development expenses increased by 3% to $6.605 million for the three months ended September 30, 2024, compared to$6.421 million for the same period in 2023, while remaining flat at $21.048 million for the nine months ended September 30, 2024, compared to$21.062 million in 2023[153]. Profitability and Loss - The company incurred a net loss of $2.288 million for the three months ended September 30, 2024, compared to a net loss of$9.801 million for the same period in 2023[158]. - The effective income tax rate was 81% for the three months ended September 30, 2024, compared to 4% for the same period in 2023, primarily due to changes in anticipated pre-tax operating results[159]. Cash Flow and Liquidity - As of September 30, 2024, net cash provided by operating activities was $12.1 million, compared to$8.0 million for the same period in 2023, representing a 51.25% increase[181]. - Net cash used in investing activities was $16.8 million for the nine months ended September 30, 2024, compared to net cash provided of$2.2 million for the same period in 2023[184]. - Net cash provided by financing activities was $2.0 million for the nine months ended September 30, 2024, down from$2.5 million in 2023[185]. - The company believes its cash from operations and existing cash and cash equivalents will meet its current operational liquidity needs for at least the next twelve months[170]. Debt and Financing - Interest expense rose to $8.4 million and$24.5 million for the three and nine months ended September 30, 2024, respectively, compared to $6.6 million and$19.1 million for the same periods in 2023, primarily due to increased interest rates from debt refinancing[155]. - A loss on extinguishment of debt of $3.7 million was recorded during the nine months ended September 30, 2024, related to the extinguishment of a previously existing term loan[156]. - The company entered into a credit and guaranty agreement for$350.0 million on January 18, 2024, which includes a $190.0 million secured term loan facility and a$60.0 million secured revolving credit facility[171]. - The company has $100.3 million in scheduled principal payments and$4.3 million in anticipated interest payments related to Convertible Senior Notes[186]. - Loans under the Term Loan Facilities bear interest at a floating annual rate with a margin of 5.50%, which may step down based on the total net leverage ratio[175]. Foreign Exchange Impact - Artivion's sales are impacted by foreign exchange fluctuations, with the US Dollar strengthening against major currencies affecting revenue translation for the three months ended September 30, 2024[122]. - A 10% adverse change in exchange rates could impact the company's financial position or cash flows by approximately $9.0 million[195]. Other Financial Metrics - Gross margin increased 8$125.4 million with an effective interest rate of 5.05%[176]. - Approximately 38% of cash and cash equivalents were held in foreign jurisdictions as of September 30, 2024[179].