On May 7, 2020 Penumbra, Inc. (NYSE: PEN), a global healthcare company focused on innovative therapies, reported financial results for the first quarter ended March 31, 2020 (Press release, Penumbra, MAY 7, 2020, View Source [SID1234557394]).
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Revenue of $137.3 million in the first quarter of 2020, an increase of 6.9%, or 7.6% in constant currency1, over the first quarter of 2019. Excluding Japan, total revenue in the first quarter of 2020 increased 13.6%, or 14.3% in constant currency1, over the first quarter of 2019.
First Quarter 2020 Financial Results
Total revenue grew to $137.3 million for the first quarter of 2020 compared to $128.4 million for the first quarter of 2019, an increase of 6.9%, or 7.6% on a constant currency basis. The United States represented 70% of total revenue and international represented 30% of total revenue for the first quarter of 2020. Revenue from sales of vascular products grew to $59.3 million for the first quarter of 2020, an increase of 26.2%, or 26.5% on a constant currency basis. Revenue from sales of neuro products declined to $78.1 million for the first quarter of 2020, a decrease of 4.2%, or 3.3% on a constant currency basis.
Gross profit was $88.0 million, or 64.1% of total revenue, for the first quarter of 2020, compared to $83.9 million, or 65.3% of total revenue, for the first quarter of 2019.
Total operating expenses for the first quarter of 2020 were $87.4 million, or 63.6% of total revenue. This compares to total operating expenses of $72.8 million, or 56.6% of total revenue, for the first quarter of 2019. R&D expenses were $12.9 million for the first quarter of 2020, compared to $11.7 million for the first quarter of 2019. SG&A expenses were $74.5 million for the first quarter of 2020, compared to $61.1 million for the first quarter of 2019.
Operating income for the first quarter of 2020 was $0.6 million, compared to an operating income of $11.2 million for the first quarter of 2019.
As of March 31, 2020, cash, cash equivalents and marketable investments totaled $168.2 million. In addition, on April 24, 2020, the Company entered into a secured credit agreement with JPMorgan Chase Bank, N.A., Bank of America, N.A. and Citibank, N.A., that provides for up to $100 million in available revolving borrowing capacity.
Impact of COVID-19 Pandemic
As noted in the Company’s April 6, 2020 press release, the Company began to observe more notable negative impact on business trends in March due to COVID-19. The Company has experienced and believes that the impact of the COVID-19 pandemic on the Company’s business differs by geography and procedure type. Due to the uncertain scope and duration of the pandemic, and uncertain timing of global recovery and economic normalization, we cannot, at this time, reliably estimate the future impact on our operations and financial results.
Webcast and Conference Call Information
Penumbra, Inc. will host a conference call to discuss the first quarter 2020 financial results after market close on Thursday, May 7, 2020 at 5:00 PM Eastern Time. The conference call can be accessed live over the phone by dialing (833) 227-5837 for domestic callers or (647) 689-4064 for international callers (conference id: 3899277), or the webcast can be accessed on the "Events" section under the "Investors" tab of the Company’s website at: www.penumbrainc.com. The webcast will be available on the Company’s website for at least two weeks following the completion of the call.