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Bioventus (BVS) - 2024 Q3 - Earnings Call Transcript
BVSBioventus (BVS)2024-11-05 17:26
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Financial Data and Key Metrics Changes - Revenue for Q3 2024 was 139million,representinga15139 million, representing a 15% increase compared to the prior year, marking the fourth consecutive quarter of double-digit organic revenue growth [16][8] - Adjusted EBITDA for the quarter was over 24 million, an increase of 2millionor82 million or 8% year-over-year, with year-to-date adjusted EBITDA up 21% compared to the prior year [16][13] - Adjusted gross margin was 75%, down 10 basis points from the previous year [16] Business Line Data and Key Metrics Changes - Surgical solutions revenue grew by 18%, driven by strong performance in both ultrasonics and bone graft substitutes [17] - Pain treatments revenue also increased by 18%, primarily due to the brand recognition and clinical differentiation of Durolane [17] - Restorative therapies sales grew by 6%, with Exogen showing accelerated growth [18] Market Data and Key Metrics Changes - The international segment experienced a 10% growth compared to the prior year, driven by Durolane and recovery of delayed shipments in the ultrasonics business [18] - The company is focused on expanding its market share in the 1 billion opportunity across spine, neuro, and general surgery [9] Company Strategy and Development Direction - The company aims to accelerate revenue growth, improve profitability, and enhance liquidity, with a commitment to expanding adjusted EBITDA margin by at least 100 basis points annually [13][14] - A divestiture of the advanced rehabilitation business for 25millionisexpectedtoclosebytheendoftheyearorearlynextyear,allowingthecompanytofocusonitscoreportfolio[12]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedconfidenceinsustainingmomentumandachievingabove−marketrevenuegrowth,marginexpansion,andcashflowaccelerationinthecomingyears[7]−Thecompanyanticipatesamaterialaccelerationincashflowin2025,drivenbyreducedone−timecashcostsandimprovedoperationalefficiencies[14][20]OtherImportantInformation−Thecompanyraiseditsfull−yearrevenueguidancetoarangeof25 million is expected to close by the end of the year or early next year, allowing the company to focus on its core portfolio [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining momentum and achieving above-market revenue growth, margin expansion, and cash flow acceleration in the coming years [7] - The company anticipates a material acceleration in cash flow in 2025, driven by reduced one-time cash costs and improved operational efficiencies [14][20] Other Important Information - The company raised its full-year revenue guidance to a range of 562 million to 567million,reflectinga567 million, reflecting a 2.5 million increase in the midpoint compared to previous guidance [21] - Adjusted earnings per share guidance for the year was increased to between 0.40and0.40 and 0.42, a $0.02 increase from prior guidance [22] Q&A Session Summary Question: Clarification on 2024 guidance and growth rate - Management indicated that lower growth in Q4 is expected due to unfavorable comparisons from the previous year and slower growth in bone graft substitutes [25] Question: Expectations for pain business in Q4 - Management feels confident about the pain business continuing its momentum, with some price benefits expected in Q4 [28] Question: Growth disparity in 2025 - Management noted that while the start of 2025 may be softer due to temporary lag effects, they remain optimistic about overall momentum [33] Question: Competitor concerns in the HA business - Management expressed no concerns regarding competitors, citing strong clinical differentiation and a dedicated sales force as key advantages [39] Question: Expectations for international business - Management is optimistic about the growth potential of the international business, acknowledging foundational work is needed [41]