UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 3, 2019
AngioDynamics, Inc.
(Exact Name of Registrant as Specified in Charter)
|
Delaware
|
000-50761
|
11-3146460
|
|
(State or Other Jurisdiction of Incorporation)
|
(Commission File
Number)
|
(IRS Employer
Identification No.)
|
|
14 Plaza Drive Latham, New York
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12110 |
|
(Address of Principal Executive Offices)
|
(Zip Code) |
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(518) 795-1400
|
|
(Registrant’s telephone number, including area code)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
| □ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
| □ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
| □ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2 (b))
|
| □ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which
registered |
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Common Stock, par value $0.01 per share
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ANGO
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NASDAQ Global Select Market
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this
chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 – Results of Operations and Financial Condition.
On October 3, 2019, AngioDynamics, Inc. (“AngioDynamics”) issued a press release announcing financial results for the fiscal first quarter ended
August 31, 2019. A copy of the press release is attached hereto as Exhibit 99.1.
The information set forth in Item 2.02 of this Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific
reference in such a filing.
Item 7.01 – Regulation FD Disclosure.
Presentation slides discussing AngioDynamics and its fiscal first quarter ended August 31, 2019 are being furnished herewith as Exhibit 99.2. The
slides are being furnished pursuant to Item 7.01 and the information contained therein shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liabilities under that Section. Furthermore, the information
in Exhibit 99.2 shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act.
Item 8.01 – Other Events.
On October 3, 2019, AngioDynamics issued a press release announcing the acquisition of Eximo Medical, Ltd. A copy of the press release is attached
hereto as Exhibit 99.3.
Forward-Looking Statements
This document and its attachments contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All
statements regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of
management for future operations, as well as statements that include the words such as “expects,” “reaffirms,” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “optimistic,” or variations of such words and similar expressions, are
forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics’ expectations. Factors
that may affect the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics’
technology or assertions that AngioDynamics’ technology infringes the technology of third parties, the ability of AngioDynamics to effectively compete against competitors that have substantially greater resources, future actions by the FDA or other
regulatory agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic conditions, the results of on-going litigation, challenges with respect to third-party distributors
or joint venture partners or collaborators, the results of sales efforts, the effects of product recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic,
credit and capital market conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to integrate
purchased businesses, as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2019. AngioDynamics does not assume any obligation to
publicly update or revise any forward-looking statements for any reason.
Item 9.01 – Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit No.
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Description
|
|
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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ANGIODYNAMICS, INC.
(Registrant)
|
|||
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Date: October 3, 2019
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By:
|
/s/ Stephen A. Trowbridge | |
| Stephen A. Trowbridge | |||
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Senior Vice President and General Counsel
|
|||
Exhibit 99.1
PRESS RELEASE
Investor Contact:
AngioDynamics, Inc.
Michael C. Greiner, Executive Vice President & CFO
(518) 795-1821
AngioDynamics Reports Fiscal 2020 First Quarter Financial Results
Fiscal 2020 First Quarter Highlights
|
•
|
Net sales of $66.0 million, an increase of 3.3% year over year
|
|
•
|
Gross margin increased 170 basis points year over year to 57.9%
|
|
•
|
GAAP loss per share of $0.03; adjusted earnings per share of $0.08
|
Latham, New York, October 3, 2019 – AngioDynamics, Inc. (NASDAQ: ANGO), a leading provider of innovative, minimally invasive medical devices for vascular access, peripheral vascular disease, and oncology, today announced financial results for the first quarter of fiscal year
2020, which ended August 31, 2019.
“Our top-line and gross-margin performance in the quarter was in line with our expectations,” commented Jim Clemmer, President and Chief Executive Officer of
AngioDynamics, Inc. “We continue to build momentum and remain focused on driving growth by creating a suite of disruptive and differentiated technology. The divestiture of the NAMIC Fluid Management business allowed us to begin the year with a strong
balance sheet, enabling strategic acquisitions like Eximo Medical, Ltd., which we announced this morning. Additionally, we continue to make steady progress with site initiation in our NanoKnife DIRECT study for pancreatic cancer.”
First Quarter 2020 Financial Results
Net sales for the first quarter of fiscal 2020 were $66.0 million, an increase of 3.3%, compared to $63.9 million a year ago and
representing a decline of 1.0% organically. Excluding the impact of Asclera, sales of which were discontinued during fiscal year 2019, net sales grew 5.6% year over year and grew 1.3% organically. Foreign currency translation did not have a significant
impact on the Company’s sales in the quarter.
• Oncology net sales were $14.0 million, an increase of 20.9% from
$11.6 million a year ago, led by sales of the Company’s BioSentry Tract Sealant System, the Alatus and IsoLoc balloon products, NanoKnife, and Solero.
• Vascular Interventions and Therapies (“VIT”) net sales were $28.9
million, an increase of 1.1%, compared to $28.6 million a year ago. Excluding last year’s Asclera Sales of $1.4 million in the first quarter, VIT grew 6.4%, as strong growth in sales of the Company’s AngioVac and Thrombolytic product line offerings was
partially offset by a decline in the overall Core VIT business.
• Vascular Access net sales were $23.2 million, a decrease of 2.7%
from $23.8 million a year ago, as lower sales of Ports and PICCs negatively offset growth in the Midlines and Dialysis businesses.
U.S. net sales in the first quarter of fiscal 2020 were $52.9 million, an increase of 2.8% from $51.5 million a year ago, and International net sales were
$13.1 million, an increase of 5.3% from $12.4 million a year ago.
Gross margin for the first quarter of fiscal 2020 was 57.9%, an increase of 170 basis points compared to the first quarter of fiscal 2019, driven primarily by
productivity and supply chain improvements as well as positive product mix.
The Company recorded a net loss from continuing operations of $1.3 million, or a loss of $0.03 per share, in the first quarter of fiscal 2020. This compares
to a net loss from continuing operations of approximately $5.7 million, or a loss of $0.15 per share, a year ago.
Excluding the items shown in the non-GAAP reconciliation table below, adjusted net income for the first quarter of fiscal 2020 was $3.2 million, or $0.08 per
share, compared to adjusted net income of $0.7 million, or $0.02 per share, in the first quarter of fiscal 2019.
Adjusted EBITDAS in the first quarter of fiscal 2020, excluding the items shown in the reconciliation table below, was $7.3 million, compared to $5.4 million
in the first quarter of fiscal 2019.
In the first quarter of fiscal 2020, the Company used $6.5 million in operating cash flow and had capital expenditures of $1.4 million. As of August 31, 2019,
the Company had $83.6 million in cash and cash equivalents and no debt outstanding.
Fiscal Year 2020 Financial Guidance
The Company continues to expect fiscal year 2020 net sales to be in the range of $280 to $286 million and gross
margin to be in the range of 58% to 59%, inclusive of the Eximo acquisition.
Separately, the Company is updating its expectations for full-year adjusted earnings per share to account for investments related to the
full-market launch of the products acquired from Eximo, anticipated in the second half of fiscal year 2020, and now expects adjusted earnings per share in the range of $0.10 to $0.15.
Conference Call
The Company’s management will host a conference call today at 8:00 a.m. ET to discuss its fiscal 2020 first quarter results.
To participate in the conference call, dial 1-877-407-0784 (domestic) or +1-201-689-8560 (international) and refer to the passcode 13694372.
This conference call will also be webcast and can be accessed from the “Investors” section of the AngioDynamics website at www.angiodynamics.com. The webcast replay of the
call will be available at the same site approximately one hour after the end of the call.
A recording of the call will also be available from 11:00 a.m. ET on Thursday, October 3, 2019, until 11:59 p.m. ET on Thursday, October 10, 2019. To hear
this recording, dial 1-844-512-2921 (domestic) or +1-412-317-6671 (international) and enter the passcode 13694372.
Use of Non-GAAP Measures
Management uses non-GAAP measures to establish operational goals and believes that non-GAAP measures may assist investors in analyzing the underlying trends
in AngioDynamics' business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting measures prepared in accordance with GAAP. In this news release, AngioDynamics has
reported adjusted EBITDAS, adjusted net income, adjusted earnings per share, free cash flow and net sales on an organic basis, excluding acquired assets and Asclera. Management uses these measures in its internal analysis and review of operational
performance. Management believes that these measures provide investors with useful information in comparing AngioDynamics' performance over different periods. By using these non-GAAP measures, management believes that investors get a better picture of
the performance of AngioDynamics' underlying business. Management encourages investors to review AngioDynamics' financial results prepared in accordance with GAAP to understand AngioDynamics' performance taking into account all relevant factors,
including those that may only occur from time to time but have a material impact on AngioDynamics' financial results. Please see the tables that follow for a reconciliation of non-GAAP measures to measures prepared in accordance with GAAP.
About AngioDynamics, Inc.
AngioDynamics, Inc. is a leading provider of innovative, minimally invasive medical devices used by professional healthcare providers for
vascular access, peripheral vascular disease, and oncology. AngioDynamics’ diverse product lines include market-leading ablation systems, vascular access products, angiographic products and accessories, drainage products, thrombolytic products and
venous products. For more information, visit www.angiodynamics.com.
Safe Harbor
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding
AngioDynamics' expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for
future operations, as well as statements that include the words such as "expects," "reaffirms," "intends," "anticipates," "plans," "believes," "seeks," "estimates," "optimistic," or variations of such words and similar expressions, are forward-looking
statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics' expectations. Factors that may affect
the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics' technology or
assertions that AngioDynamics' technology infringes the technology of fourth parties, the ability of AngioDynamics to effectively compete against competitors that have substantially greater resources, future actions by the FDA or other regulatory
agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic conditions, the results of on-going litigation, challenges with respect to fourth-party distributors or joint
venture partners or collaborators, the results of sales efforts, the effects of product recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic, credit
and capital market conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to integrate acquired
businesses, as well as the risk factors listed from time to time in AngioDynamics' SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2019. AngioDynamics does not assume any obligation to publicly update
or revise any forward-looking statements for any reason.
In the United States, the NanoKnife System has received a 510(k) clearance by the Food and Drug Administration for use in the surgical ablation of soft
tissue and is similarly approved for commercialization in Canada, the European Union, and Australia. The NanoKnife System has not been cleared for the treatment or therapy of a specific disease or condition.
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
|
Three months ended
|
||||||||
|
August 31, 2019
|
August 31, 2018
|
|||||||
|
(unaudited)
|
||||||||
|
Net sales
|
$
|
66,042
|
$
|
63,943
|
||||
|
Cost of sales (exclusive of intangible amortization)
|
27,825
|
27,990
|
||||||
|
Gross profit
|
38,217
|
35,953
|
||||||
|
% of net sales
|
57.9
|
%
|
56.2
|
%
|
||||
|
Operating expenses
|
||||||||
|
Research and development
|
6,292
|
7,374
|
||||||
|
Sales and marketing
|
19,380
|
18,405
|
||||||
|
General and administrative
|
8,453
|
8,435
|
||||||
|
Amortization of intangibles
|
3,868
|
3,434
|
||||||
|
Change in fair value of contingent consideration
|
(448
|
)
|
12
|
|||||
|
Acquisition, restructuring and other items, net
|
1,500
|
4,422
|
||||||
|
Total operating expenses
|
39,045
|
42,082
|
||||||
|
Operating income
|
(828
|
)
|
(6,129
|
)
|
||||
|
Interest expense, net
|
(465
|
)
|
(917
|
)
|
||||
|
Other income (expense), net
|
(98
|
)
|
114
|
|||||
|
Total other expense, net
|
(563
|
)
|
(803
|
)
|
||||
|
Loss from continuing operations before income taxes
|
(1,391
|
)
|
(6,932
|
)
|
||||
|
Income tax benefit
|
(116
|
)
|
(1,228
|
)
|
||||
|
Net loss from continuing operations
|
(1,275
|
)
|
(5,704
|
)
|
||||
|
Net Income from discontinued operations
|
—
|
5,235
|
||||||
|
Net loss
|
$
|
(1,275
|
)
|
$
|
(469
|
)
|
||
|
Loss per share - continuing operations
|
||||||||
|
Basic
|
$
|
(0.03
|
)
|
$
|
(0.15
|
)
|
||
|
Diluted
|
$
|
(0.03
|
)
|
$
|
(0.15
|
)
|
||
|
Income per share - discontinued operations
|
||||||||
|
Basic
|
$
|
—
|
$
|
0.14
|
||||
|
Diluted
|
$
|
—
|
$
|
0.14
|
||||
|
Loss per share
|
||||||||
|
Basic
|
$
|
(0.03
|
)
|
$
|
(0.01
|
)
|
||
|
Diluted
|
$
|
(0.03
|
)
|
$
|
(0.01
|
)
|
||
|
Weighted average shares outstanding
|
||||||||
|
Basic
|
37,783
|
37,323
|
||||||
|
Diluted
|
37,783
|
37,323
|
||||||
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(in thousands, except per share data)
Reconciliation of Net Loss to non-GAAP Adjusted Net Income:
|
Three months ended
|
||||||||
|
August 31, 2019
|
August 31, 2018
|
|||||||
|
(unaudited)
|
||||||||
|
Net loss from continuing operations
|
$
|
(1,275
|
)
|
$
|
(5,704
|
)
|
||
|
Amortization of intangibles
|
3,868 |
3,434
|
||||||
|
Change in fair value of contingent consideration
|
(448
|
)
|
12
|
|||||
|
Acquisition, restructuring and other items, net (1)
|
1,500
|
4,422
|
||||||
|
Write-off of deferred financing fees (2)
|
593
|
—
|
||||||
|
Tax effect of non-GAAP items (3)
|
(1,064
|
)
|
(1,443
|
)
|
||||
|
Adjusted net income
|
$
|
3,174
|
$
|
721
|
||||
Reconciliation of Diluted Earnings Per Share to non-GAAP Adjusted Diluted Earnings Per Share:
|
Three months ended
|
||||||||
|
August 31, 2019
|
August 31, 2018
|
|||||||
|
(unaudited)
|
||||||||
|
Diluted loss per share
|
$
|
(0.03
|
)
|
$
|
(0.15
|
)
|
||
|
Amortization of intangibles
|
0.10
|
0.09
|
||||||
|
Change in fair value of contingent consideration
|
(0.01
|
)
|
0.00
|
|||||
|
Acquisition, restructuring and other items, net (1)
|
0.04
|
0.12
|
||||||
|
Write-off of deferred financing fees (2)
|
0.02
|
—
|
||||||
|
Tax effect of non-GAAP items (3)
|
(0.04
|
)
|
(0.04
|
)
|
||||
|
Adjusted diluted earnings per share
|
$
|
0.08
|
$
|
0.02
|
||||
|
Adjusted diluted sharecount
|
38,158
|
38,096
|
||||||
|
(1)
|
Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
|
|
(2)
|
Deferred financing fees related to the old credit agreement were written off during the first quarter of fiscal year 2020.
|
|
(3)
|
Adjustment to reflect the income tax provision on a non-GAAP basis has been calculated assuming no valuation allowance on the Company's U.S. deferred tax assets and an effective tax rate of 23%
for August 31, 2019 and 2018.
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION (Continued)
(in thousands, except per share data)
Reconciliation of Net Income to EBITDAS and Adjusted EBITDAS:
|
Three months ended
|
||||||||
|
August 31, 2019
|
August 31, 2018
|
|||||||
|
(unaudited)
|
||||||||
|
Net loss from continuing operations
|
$
|
(1,275
|
)
|
$
|
(5,704
|
)
|
||
|
Income tax expense (benefit)
|
(116
|
)
|
(1,228
|
)
|
||||
|
Interest expense, net
|
465
|
917
|
||||||
|
Depreciation and amortization
|
5,170
|
4,812
|
||||||
|
Stock based compensation
|
1,984
|
2,143
|
||||||
|
EBITDAS
|
$
|
6,228
|
$
|
940
|
||||
|
Change in fair value of contingent consideration
|
$
|
(448
|
)
|
$
|
12
|
|||
|
Acquisition, restructuring and other items, net (1)
|
1,500
|
4,422
|
||||||
|
Adjusted EBITDAS
|
$
|
7,280
|
$
|
5,374
|
||||
|
Per diluted share:
|
||||||||
|
EBITDAS
|
$
|
0.16
|
$
|
0.02
|
||||
|
Adjusted EBITDAS
|
$
|
0.19
|
$
|
0.14
|
||||
|
(1)
|
Includes costs related to merger and acquisition activities, restructuring, and unusual items, including asset impairments and write-offs, certain litigation, and other items.
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
(in thousands)
|
Three months ended
|
||||||||||||||||||
|
Aug 31, 2019
|
Aug 31, 2018
|
% Growth
|
Currency Impact
|
Constant Currency Growth
|
||||||||||||||
|
Net Sales by Product Category
|
||||||||||||||||||
|
Vascular Interventions & Therapies
|
$
|
28,913
|
$
|
28,598
|
1.1
|
%
|
||||||||||||
|
Vascular Access
|
23,159
|
23,790
|
(2.7
|
)%
|
||||||||||||||
|
Oncology
|
13,970
|
11,555
|
20.9
|
%
|
||||||||||||||
|
Total
|
$
|
66,042
|
$
|
63,943
|
3.3
|
%
|
1.0
|
%
|
3.5
|
%
|
||||||||
|
Net Sales by Geography
|
||||||||||||||||||
|
United States
|
$
|
52,937
|
$
|
51,496
|
2.8
|
%
|
0.0
|
%
|
2.8
|
%
|
||||||||
|
International
|
13,105
|
12,447
|
5.3
|
%
|
1.0
|
%
|
6.4
|
%
|
||||||||||
|
Total
|
$
|
66,042
|
$
|
63,943
|
3.3
|
%
|
1.0
|
%
|
3.5
|
%
|
||||||||
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
|
August 31, 2019
|
May 31, 2019
|
||||
|
(unaudited)
|
(audited)
|
||||
|
Assets
|
|||||
|
Current assets:
|
|||||
|
Cash and cash equivalents
|
$
|
83,649
|
$
|
227,641
|
|
|
Total cash and investments
|
83,649
|
227,641
|
|||
|
Accounts receivable, net
|
32,540
|
43,577
|
|||
|
Inventories
|
45,229
|
40,071
|
|||
|
Prepaid expenses and other
|
4,939
|
4,003
|
|||
|
Total current assets
|
166,357
|
315,292
|
|||
|
Property, plant and equipment, net
|
25,334
|
24,258
|
|||
|
Other assets
|
9,352
|
3,835
|
|||
|
Intangible assets, net
|
141,655
|
145,387
|
|||
|
Goodwill
|
347,666
|
347,666
|
|||
|
Total assets
|
$
|
690,364
|
$
|
836,438
|
|
|
Liabilities and stockholders' equity
|
|||||
|
Current liabilities:
|
|||||
|
Accounts payable
|
$
|
16,870
|
$
|
22,829
|
|
|
Accrued liabilities
|
22,693
|
38,338
|
|||
|
Current portion of long-term debt
|
—
|
7,500
|
|||
|
Current portion of contingent consideration
|
878
|
4,635
|
|||
|
Other current liabilities
|
6,731
|
—
|
|||
|
Total current liabilities
|
47,172
|
73,302
|
|||
|
Long-term debt, net of current portion
|
—
|
124,407
|
|||
|
Deferred income taxes
|
14,367
|
14,542
|
|||
|
Contingent consideration, net of current portion
|
10,952
|
8,851
|
|||
|
Other long-term liabilities
|
3,800
|
521
|
|||
|
Total liabilities
|
76,291
|
221,623
|
|||
|
Stockholders' equity
|
614,073
|
614,815
|
|||
|
Total Liabilities and Stockholders' Equity
|
$
|
690,364
|
$
|
836,438
|
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
|
Three months ended
|
||||||||
|
August 31, 2019
|
August 31, 2018
|
|||||||
|
(unaudited)
|
||||||||
|
Cash flows from operating activities:
|
||||||||
|
Net loss from continuing operations
|
$
|
(1,275
|
)
|
$
|
(469
|
)
|
||
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
||||||||
|
Depreciation and amortization
|
5,207
|
5,599
|
||||||
|
Stock based compensation
|
1,984
|
2,150
|
||||||
|
Change in fair value of contingent consideration
|
(448
|
)
|
12
|
|||||
|
Deferred income taxes
|
(175
|
)
|
(10
|
)
|
||||
|
Change in accounts receivable allowances
|
(453
|
)
|
(228
|
)
|
||||
|
Fixed and intangible asset impairments and disposals
|
99
|
—
|
||||||
|
Write-off of other assets
|
593
|
—
|
||||||
|
Other
|
(8
|
)
|
25
|
|||||
|
Changes in operating assets and liabilities, net of acquisitions:
|
||||||||
|
Accounts receivable
|
11,474
|
(562
|
)
|
|||||
|
Inventories
|
(5,153
|
)
|
(761
|
)
|
||||
|
Prepaid expenses and other
|
(746
|
)
|
(1,200
|
)
|
||||
|
Accounts payable, accrued and other liabilities
|
(17,633
|
)
|
(13,429
|
)
|
||||
|
Net cash used in operating activities
|
(6,534
|
)
|
(8,873
|
)
|
||||
|
Cash flows from investing activities:
|
||||||||
|
Additions to property, plant and equipment
|
(1,391
|
)
|
(682
|
)
|
||||
|
Acquisition of intangibles
|
(150
|
)
|
—
|
|||||
|
Cash paid in acquisition
|
—
|
(37,000
|
)
|
|||||
|
Net cash used in investing activities
|
(1,541
|
)
|
(37,682
|
)
|
||||
|
Cash flows from financing activities:
|
||||||||
|
Repayment of long-term debt
|
(132,500
|
)
|
(1,250
|
)
|
||||
|
Deferred financing costs on long-term debt
|
(741
|
)
|
—
|
|||||
|
Payment of contingent consideration previously established in purchase accounting
|
(1,208
|
)
|
(2,100
|
)
|
||||
|
Proceeds (outlays) from exercise of stock options and employee stock purchase plan
|
(1,300
|
)
|
705
|
|||||
|
Net cash used in financing activities
|
(135,749
|
)
|
(2,645
|
)
|
||||
|
Effect of exchange rate changes on cash and cash equivalents
|
(168
|
)
|
(134
|
)
|
||||
|
Decrease in cash and cash equivalents
|
(143,992
|
)
|
(49,334
|
)
|
||||
|
Cash and cash equivalents at beginning of period
|
227,641
|
74,096
|
||||||
|
Cash and cash equivalents at end of period
|
$
|
83,649
|
$
|
24,762
|
||||
ANGIODYNAMICS, INC. AND SUBSIDIARIES
GAAP TO NON-GAAP RECONCILIATION
(in thousands)
Reconciliation of Free Cash Flows:
|
Three months ended
|
||||||||
|
August 31, 2019
|
August 31, 2018
|
|||||||
|
(unaudited)
|
||||||||
|
Net cash used in operating activities
|
$
|
(6,534
|
)
|
$
|
(8,873
|
)
|
||
|
Additions to property, plant and equipment
|
(1,391
|
)
|
(682
|
)
|
||||
|
Free Cash Flow
|
$
|
(7,925
|
)
|
$
|
(9,555
|
)
|
||
Exhibit 99.2
AngioDynamics First Quarter 2020 Earnings PresentationOctober 3, 2019
Notice Regarding Forward-Looking StatementsThis presentation contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital
expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include the words such as “expects,” “reaffirms,” “intends,” “anticipates,” “plans,”
“believes,” “seeks,” “estimates,” “optimistic,” or variations of such words and similar expressions, are forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and
uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics’ expectations. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to
develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics’ technology or assertions that AngioDynamics’ technology infringes the technology of third parties, the ability of
AngioDynamics to effectively compete against competitors that have substantially greater resources, future actions by the FDA or other regulatory agencies, domestic and foreign health care reforms and government regulations, results of pending
or future clinical trials, overall economic conditions, the results of on-going litigation, challenges with respect to third-party distributors or joint venture partners or collaborators, the results of sales efforts, the effects of product
recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic, credit and capital market conditions, general market conditions, market acceptance,
foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to integrate acquired businesses, as well as the risk factors listed from time to time in
AngioDynamics’ SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2019. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason.In
the United States, the NanoKnife System has received a 510(k) clearance by the Food and Drug Administration for use in the surgical ablation of soft tissue, and is similarly approved for commercialization in Canada, the European Union and
Australia. The NanoKnife System has not been cleared for the treatment or therapy of a specific disease or condition.Notice Regarding Non-GAAP Financial MeasuresManagement uses non-GAAP measures to establish operational goals, and believes that
non-GAAP measures may assist investors in analyzing the underlying trends in AngioDynamics’ business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting
measures prepared in accordance with GAAP. In this presentation, AngioDynamics has reported adjusted EBITDAS (income before interest, taxes, depreciation and amortization and stock-based compensation); adjusted net income; adjusted earnings per
shar, free cash flow and net sales on an organic basis, excluding acquired assets and Asclera. Management uses these measures in its internal analysis and review of operational performance. Management believes that these measures provide
investors with useful information in comparing AngioDynamics’ performance over different periods. By using these non-GAAP measures, management believes that investors get a better picture of the performance of AngioDynamics’ underlying
business. Management encourages investors to review AngioDynamics’ financial results prepared in accordance with GAAP to understand AngioDynamics’ performance taking into account all relevant factors, including those that may only occur from
time to time but have a material impact on AngioDynamics’ financial results. Please see the tables that follow for a reconciliation of non-GAAP measures to measures prepared in accordance with GAAP. Forward-Looking Statements
First Quarter FY2020 Highlights Corporate Developments NanoKnife DIRECT study: 7 sites have IRB
approval to begin patient enrollment; anticipate approximately up to 10 more site approvals by end of FY.Paid down all existing outstanding debt and entered into a new revolver-only credit facility of $125.0 million on June 3, 2019.Eximo
Medical, Ltd. acquisition completed for upfront consideration of $46.0 million plus up to $20.0 of consideration for future earnouts. * Excluding Asclera, Venous Insufficiency growth was 1.2%. Financial Performance Product Family
Year-over-Year Sales Growth (in millions) Q1 FY20 Q1 FY19 Change Revenue $66.0 $63.9 3.3% Organic Revenue $62.9 $63.6 (1.0%) Revenue Excluding Asclera $66.0 $62.5 5.6% Organic Revenue Excluding
Asclera $62.9 $62.2 1.3% Gross Margin 57.9% 56.2% 170 bps Adjusted EPS $0.08 $0.02 $0.06 Adjusted EBITDAS $7.3 $5.4 $1.9 Cash Used in Operations ($6.5) ($8.9) Free Cash Flow ($7.9) ($9.6) Vascular Interventions
and Therapies AngioVac® 33% Thrombolytic 16% Core Peripheral (1%) Venous Insufficiency (15%)* Vascular Access Midlines 5% PICCs (9%) Ports (9%) Dialysis 11% Oncology NanoKnife® 4% Solero® Microwave 3% RadioFrequency
Ablation (18%)
First Quarter FY2020 Results (unaudited) $ in thousands (except per share data) FY2020Q1
Results FY2019Q1 Results Change Revenue Vascular Interventions and Therapies Vascular Access Oncology United States International $66,04228,91323,15913,97052,93713,105 $63,94328,59823,79011,55551,49612,447 3.3%1.1%(2.7%)20.9%2.8%5.3% Net
Loss from Continuing OperationsAdjusted Net Income ($1,275)$3,174 ($5,704)$721 GAAP Loss Per ShareNon-GAAP Adjusted EPS ($0.03)$0.08 ($0.15)$0.02 Gross Margin 57.9% 56.2% Adjusted EBITDAS $7,280 $5,374 Free Cash
Flow ($7,925) ($9,555) Cash $83,649 $227,641* Debt $0 $132,500* * Balances reflect amounts at May 31, 2019.
Balance Sheet Position (in millions) Cash at May 31, 2019 $227.6 Pay down Credit
Facility (132.5) Variable Compensation Payment* (8.7) Third Party Closing Costs Related to the Fluid Management Sale (3.7) Merz Settlement Payment (2.5) Contingent Consideration Payment (1.2) Net Cash Provided by Operations 4.6 Cash
at August 31, 2019 $83.6 Use of Cash in Q1 FY20 * Includes annual bonus and year-end commission payments. (in millions) Debt at May 31, 2019 $132.5 Pay down Credit Facility (132.5) Draw on Revolver 0.0 Debt at August 31,
2019 $0.0 * Based on current EBITDAS, as defined by the Credit Agreement.** Option to extend leverage ratio for a period of 4 consecutive fiscal quarters to 3.50 after an acquisition that exceeds $35 million. (in millions) Approximate
Cash at October 2, 2019 $84.5 Cash Used in Eximo Acquisition 45.8 Cash Post Acquisition $38.7 Debt at August 31, 2019 $0.0 Draw on Revolver for Eximo Acquisition 0.0 Debt Post Acquisition $0.0 Paid down all existing debt during
Q1 FY20.New credit agreement consists of a $125.0 million revolving facility. New Credit Facility (in millions) Total Revolver $125.0 Available to Draw* $100.0 Available to Draw with Extended Leverage Ratio** $118.0 Total
Cash $38.7 Cash for Operations 20.0 Available Cash $18.7 Total Available Capacity with Extended Leverage Ratio $136.7 Balance Sheet Impact of Eximo Acquisition Available Capacity Post Eximo Acquisition
FY2020 Guidance RevenueAdjusted EPS Gross Margin Previous Guidance$280 - $286m$0.25 - $0.3058% -
59% Current Guidance$280 - $286m$0.10 - $0.15*58% - 59% * Current guidance to account for investments related to a full-market launch of the products acquired from Eximo Medical Ltd.
GAAP to Non-GAAP Reconciliation
Reconciliation of GAAP to Non-GAAP Net Income and EPS Amounts in thousands Includes costs related to
merger and acquisition activities, restructurings, and unusual items, including asset impairments and write-offs, certain litigation, and other items.Deferred financing fees related to the old credit agreement were written off during the first
quarter of fiscal year 2020.Adjustment to reflect the income tax provision on a non-GAAP basis has been calculated assuming no valuation allowance on the Company's U.S. deferred tax assets and an effective tax rate of 23% for August 31, 2019
and 2018.
Reconciliation of Net Income to EBITDAS to Adjusted EBITDAS Amounts in thousands
Growth through Focus Execution Accountability
Exhibit 99.3
NEWS RELEASE
|
Investor Relations Contact:
|
Media Contact:
|
|
AngioDynamics, Inc.
|
AngioDynamics, Inc.
|
|
Michael Greiner
|
Saleem Cheeks
|
|
518-795-1821
|
518-795-1174
|
|
mgreiner@angiodynamics.com
|
scheeks@angiodynamics.com
|
AngioDynamics Acquires Eximo Medical, Ltd. and its Innovative 355nm Laser Atherectomy Technology
Latham, New York, October 3, 2019 – AngioDynamics, Inc. (NASDAQ: ANGO), a leading provider of
innovative, minimally invasive medical devices for vascular access, peripheral vascular disease, and oncology, today announced that it has acquired Eximo Medical, Ltd., an early commercial stage, medical device company, and its proprietary 355nm
wavelength laser-technology platform for $46 million in up-front consideration with up to $20 million of contingent consideration related to certain technical and revenue milestones. The transaction is being funded exclusively through the use of cash
on hand.
This transaction expands AngioDynamics’ existing Vascular Interventions and Therapies (VIT) product portfolio by adding Eximo’s proprietary laser technology, which has received 510(k) clearance
for use in the treatment of Peripheral Artery Disease (PAD). The Eximo technology complements AngioDynamics’ leading thrombus management and venous insufficiency technologies.
“The acquisition of Eximo brings a remarkable, foundational technology to our portfolio that will change the way caregivers deliver treatment to patients with PAD,” said Jim Clemmer, President
and Chief Executive Officer of AngioDynamics, Inc. “The market is ripe for disruption, and the level of precision, safety, and efficiency offered to physicians by this laser technology creates a
substantially differentiated alternative to legacy atherectomy devices.”
Physicians provide atherectomy treatment to over 200,000 Americans annually1, and Eximo’s laser technology represents a technological breakthrough among medical devices used in
atherectomy procedures to treat PAD today. In acquiring Eximo and its laser technology, AngioDynamics enters a growing $500+ million market with an innovative medical solution that offers greater
versatility, a wider range of treatments, and strong clinical data to support its efficacy.
Differentiated from other legacy medical devices, Eximo’s laser technology is the only system capable of delivering short, high-powered pulsed-laser energy in 355nm wavelength without
compromising the integrity of its fiber optic cables during atherectomy procedures. The technology addresses the risk of perforation through tissue selectivity, addresses the risk of embolization to the patient through the availability of
aspiration and is indicated to provide
1 Medtech 360 Peripheral Vascular Devices Market Analysis 2017
treatment for In-Stent Restenosis (ISR), which is the gradual re-narrowing of the artery after a blockage has been previously treated with a stent.
Additionally, Eximo’s laser technology advances patient treatment options and care by treating a variety of PAD lesion types both above- and below-the-knee. The technology is a safe, fast, and
effective system that clinical studies have shown to be effective in treating lesions ranging from soft plaque to severely calcified23.
“We are very happy to join AngioDynamics”, said Yoel Zabar, Chief Executive Officer of Eximo Medical, Ltd. “We believe that AngioDynamics’ existing resources and commercial acumen will enable a
large number of patients to benefit from Eximo’s laser technology, and we look forward to extending its utility into other indications within vascular and elsewhere. We would also like to thank the number of physicians that have already partnered
with us during our journey, and we look forward to continuing our work together as we expand our physician base.”
AngioDynamics management will discuss the transaction during its scheduled FY2020 First Quarter Financial Results Conference Call, Thursday, October 3, 2019, at 8:00 a.m. EST. For more
information about Eximo, visit www.angiodynamics.com/eximo.
About AngioDynamics, Inc.
AngioDynamics, Inc. is a leading provider of innovative, minimally invasive medical devices used by professional healthcare providers for vascular access, peripheral vascular disease, and
oncology. AngioDynamics’ diverse product lines include market-leading ablation systems, vascular access products, angiographic products and accessories, drainage products, thrombolytic products and venous products. For more information, visit www.angiodynamics.com.
Safe Harbor
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics' expected future financial
position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements
that include the words such as "expects," "reaffirms," "intends," "anticipates," "plans," "believes," "seeks," "estimates," "optimistic," or variations of such words and similar expressions, are forward-looking statements. These forward-looking
statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics' expectations. Factors that may affect the actual results achieved by
AngioDynamics include, without limitation, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, infringement of AngioDynamics' technology or assertions that AngioDynamics'
technology infringes the technology of fourth parties, the ability of AngioDynamics to effectively compete against
2 Rundback, J, Chandra, P, Brodmann, M, et al. Catheter Cardiovasc Interv. 2019; 1– 8. https://doi.org/10.1002/ccd.28435
3 Nicolas W. Shammas, Pradeep Chandra, Marianne Brodmann, et al. Cardiovascular Revascularization Medicine, 2018, ISSN 1553-8389, https://doi.org/10.1016/j.carrev.2018.11.022
competitors that have substantially greater resources, future actions by the FDA or other regulatory agencies, domestic and foreign health care reforms and government regulations, results
of pending or future clinical trials, overall economic conditions, the results of on-going litigation, challenges with respect to fourth-party distributors or joint venture partners or collaborators, the results of sales efforts, the effects of
product recalls and product liability claims, changes in key personnel, the ability of AngioDynamics to execute on strategic initiatives, the effects of economic, credit and capital market conditions, general market conditions, market acceptance,
foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to integrate acquired businesses, as well as the risk factors listed from time to time in
AngioDynamics' SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2019. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason.