AngioDynamics Reports Fiscal 2021 First Quarter Financial Results

“We had a strong first quarter, as our customers continued to show signs of recovery from the disruption of COVID-19,” commented Jim Clemmer, President and Chief Executive Officer of AngioDynamics, Inc. “While customer demand has not yet returned to pre-COVID levels, the team is clearly executing in this challenging environment. Our key technology platforms performed well during the quarter, including strong sales growth of our AngioVac platform and more than $1 million in sales of our Auryon platform. We’re still seeing the impact of COVID, particularly in our Oncology business, but, despite the unique challenges presented by this environment, we remain confident in our ability to efficiently manage the business while growing our key technology platforms.”

First Quarter 2021 Financial Results

Net sales for the first quarter of fiscal 2021 were $70.2 million, an increase of 6.3% compared to the prior-year quarter. Net sales in the first quarter continued to be impacted by the disruption to procedure volumes resulting from the COVID-19 global pandemic. Foreign currency translation did not have a significant impact on the Company’s sales in the quarter.

• Oncology net sales were $12.3 million, a decrease of 12.3% from $14.0 million a year ago, with growth in microwave ablation and U.S. NanoKnife probe sales more than offset by lower sales in international markets.
• Vascular Interventions and Therapies (“VIT”) net sales were $29.9 million, an increase of 3.3%, compared to $29.0 million a year ago. Sales of AngioVac grew 46% over the previous year and were partially offset by a decline in sales of Venous products as a result of lower elective procedure volumes. Auryon sales during the quarter were $1.1 million, and the Company announced the full commercial launch of this platform on September 21, 2020.
• Vascular Access net sales were $28.1 million, an increase of 21.4% from $23.2 million a year ago, which includes the impact of a previously disclosed sale in the UK through our distributor partner to the NHS. Excluding the impact of this sale, Vascular Access sales declined approximately 1.2% year over year.

U.S. net sales in the first quarter of fiscal 2021 were $54.1 million, an increase of 2.2% from $52.9 million a year ago, and International net sales were $16.1 million, including the one-time sale to NHS, an increase of 22.9% from $13.1 million a year ago.

Gross margin for the first quarter of fiscal 2021 was 50.9%, a decline of 700 basis points compared to the first quarter of fiscal 2020. The gross margin decline was primarily attributable to the Company’s previously discussed COVID-related operating plan, which included COVID-related operating protocols designed to ensure supply-chain security and employee safety. Additionally, during the first quarter, inventory was reduced by $7.2 million when compared to inventory levels on May 31, 2020.

The Company recorded a net loss of $4.3 million, or loss per share of $0.11, in the first quarter of fiscal 2021. This compares to net loss of approximately $1.3 million, or loss per share of $0.03, a year ago.

Excluding the items shown in the non-GAAP reconciliation table below, adjusted net income for the first quarter of fiscal 2021 was $0.6 million or adjusted earnings of $0.02 per share, compared to adjusted net income of $3.2 million, or adjusted earnings per share of $0.08, in the first quarter of fiscal 2020.

Adjusted EBITDA in the first quarter of fiscal 2021, excluding the items shown in the reconciliation table below, was $4.5 million, compared to $7.3 million in the first quarter of fiscal 2020.

In the first quarter of fiscal 2021, the Company used $5.4 million in operating cash and had capital expenditures of $1.8 million. As of August 31, 2020, the Company had $47.9 million in cash and cash equivalents compared to $54.4 million in cash and cash equivalents at the end of the fourth quarter of fiscal 2020. As of August 31, 2020, the Company had $40.0 million in debt outstanding, consistent with its debt balance on May 31, 2020. Management remains focused on cash preservation amid the current environment.

Fiscal Year 2021 Financial Guidance

The Company expects fiscal year 2021 net sales to be in the range of $278 to $284 million and fiscal year 2021 adjusted earnings per share to be in the range of $0.00 to $0.05.

Conference Call

The Company’s management will host a conference call today at 8:00 a.m. ET to discuss its fiscal 2021 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 13710506.

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 Tuesday, September 29, 2020, until 11:59 p.m. ET on Tuesday, October 6, 2020. To hear this recording, dial 1-844-512-2921 (domestic) or +1-412-317-6671 (international) and enter the passcode 13710506.

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 EBITDA, adjusted net income, adjusted earnings per share, and free cash flow. 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 scale and scope of the COVID-19 global pandemic, 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, 2020. 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.