On November 4, 2020 CryoLife, Inc. (NYSE: CRY), a leading cardiac and vascular surgery company focused on aortic disease, reported its financial results for the third quarter ended September 30, 2020 (Press release, CryoLife, NOV 4, 2020, View Source [SID1234569897]).
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"Our performance in the third quarter further validated our belief that the majority of products in our portfolio are used in procedures that cannot be postponed or delayed for long. We believe our business is weathering the pandemic well and we continue to progress on our strategic initiatives," commented Pat Mackin, Chairman, President, and Chief Executive Officer. "We saw an improvement in procedure volumes sequentially month to month from July to September with a corresponding increase in revenue growth over those months. Our manufacturing facilities continue to run at near capacity and our supply chain remains largely intact. We have continued to fund R&D programs related to products that we believe will deliver revenue in 2021 and 2022, including our regulatory approvals for U.S. PerClot PMA, BioGlue China and PROACT Mitral. Lastly, we completed the acquisition of Ascyrus Medical LLC, further strengthening our innovative portfolio of products focused on aortic repair and increasing our total addressable market opportunity to over $6 billion, providing us adequate opportunity to drive our financial performance for years to come. Given these achievements in the third quarter, we remain optimistic that we will deliver on our growth strategy and remain in a position of strength through 2021."
Third Quarter Financial Results
Total revenues for the third quarter of 2020 were $65.1 million, reflecting a decrease of (4%) on a GAAP and non-GAAP constant currency basis, both compared to the third quarter of 2019. Revenue performance across all product lines reflected the impact of the COVID-19 pandemic on the number of procedures using our products.
Net loss for the third quarter of 2020 was ($2.9) million, or ($0.08) per fully diluted common share, compared to net loss of ($134,000), or less than $0.01 per fully diluted common share for the third quarter of 2019. Non-GAAP net income for the third quarter of 2020 was $4.9 million, or $0.13 per fully diluted common share, compared to non-GAAP net income of $2.5 million, or $0.07 per fully diluted common share for the third quarter of 2019.
2020 Financial Outlook
Due to continued uncertainties resulting from the COVID-19 pandemic, the Company is not issuing 2020 financial guidance at this time.
The Company’s financial performance for 2020 is subject to the risks identified below.
Non-GAAP Financial Measures
This press release contains non-GAAP financial measures. Investors should consider this non-GAAP information in addition to, and not as a substitute for, financial measures prepared in accordance with U.S. GAAP. In addition, this non-GAAP financial information may not be the same as similar measures presented by other companies. The Company’s non-GAAP net income and non-GAAP EBITDA results exclude (as applicable) business development, integration, and severance expense, amortization expense, non-cash interest expense, loss on foreign currency revaluation, stock-based compensation expense, and corporate rebranding expense. The Company believes that these non-GAAP presentations provide useful information to investors regarding unusual non-operating transactions; the operating expense structure of the Company’s existing and recently acquired operations, without regard to its on-going efforts to acquire additional complementary products and businesses and the transaction and integration expenses incurred in connection with recently acquired and divested product lines; and the operating expense structure excluding fluctuations resulting from foreign currency revaluation and stock-based compensation expense. The Company believes it is useful to exclude certain expenses because such amounts in any specific period may not directly correlate to the underlying performance of its business operations or can vary significantly between periods as a result of factors such as acquisitions, or non-cash expense related to amortization of previously acquired tangible and intangible assets. The Company has excluded the impact of changes in currency exchange from certain revenues to evaluate growth rates on a constant currency basis. The Company does, however, expect to incur similar types of expenses and currency exchange impacts in the future, and this non-GAAP financial information should not be viewed as a statement or indication that these types of expenses will not recur.
Webcast and Conference Call Information
The Company will hold a teleconference call and live webcast later today, November 4, 2020 at 4:30 p.m. ET to discuss the results followed by a question and answer session. To listen to the live teleconference, please dial 201-689-8261. A replay of the teleconference will be available through November 11, 2020 and can be accessed by calling (toll free) 877-660-6853 or 201-612-7415. The Conference ID for the replay is 13712302.
The live webcast and replay can be accessed by going to the Investor Relations section of the CryoLife website at www.cryolife.com and selecting the heading Webcasts & Presentations.