KIRKLAND, Wash., April 14, 2025 (GLOBE NEWSWIRE) — Kestra Medical Technologies, Ltd. (Nasdaq: KMTS) (“Kestra”), a wearable medical device and digital healthcare company, today reported financial results for the third quarter fiscal 2025, which ended January 31, 2025. Recent Highlights Q3 FY25 revenue and gross margin were in line with the preliminary estimated financial results previously disclosed in the company’s IPO prospectus. Generated revenue of $15.1 million in Q3 FY25, an increase of 82% compared to the prior year period.Achieved gross margin of 43.4% in Q3 FY25 compared to 10.6% in the prior year period. Completed initial public offering in March 2025, raising approximately $205.2 million of net proceeds.Signed in-network contracts with additional insurers, with covered lives for the ASSURE® system now totaling more than 285 million health plan members in the United States.Appointed Mr. Al Ford as Chief Commercial Officer. “Our quarterly results reflect sustained commercial momentum as Kestra grows and penetrates the wearable defibrillator market,” said Brian Webster, President and CEO. “We continue to make progress on our key operational objectives, including expansion of our commercial organization and advancement of our revenue cycle management capabilities. Following our initial public offering in March, we remain focused on delivering strong growth and executing on our commitments to patients and their prescribers.” Q3 FY25 Financial Results Total revenue was $15.1 million, an increase of 82% compared to the prior year period. 3,459 prescriptions were written for the ASSURE® system, an increase of 51% compared to the prior year period.Revenue growth was driven by higher share of wallet at existing customers and activation of new accounts. Revenue also benefited from a higher mix of in-network patients and improvements in revenue cycle management capabilities. Gross profit was $6.5 million compared to $0.9 million in the prior year period. Gross margin improved to 43.4% compared to 10.6% in the prior year period, driven by volume leverage and a higher mix of in-network patients. Operating expenses were $27.1 million compared to $20.8 million in the prior year period. The increase was attributable to growth in commercial and revenue cycle headcount and a $1.9 million increase in professional services expenses related to the IPO. GAAP net loss and comprehensive loss was $21.8 million compared to GAAP net loss and comprehensive loss of $21.6 million in the prior year period. Adjusted EBITDA loss was $16.3 million compared to an adjusted EBITDA loss of $16.2 million in the prior year period. Cash and cash equivalents totaled $54.4 million as of January 31, 2025. Net proceeds from the initial public offering completed in March 2025 totaled $205.2 million, after deducting underwriting discounts, commissions and offering expenses. Fiscal Year 2025 Revenue Outlook Kestra expects revenue for fiscal year ending April 30, 2025 to be in the range of $58.0 million to $58.5 million, representing growth of approximately 109% to 110% compared to fiscal year 2024. Webcast and Conference CallKestra will host a conference call today, April 14, 2025, at 4:30 p.m. ET to discuss third quarter fiscal 2025 financial results. A live and archived webcast of the event will be available in the “Events” section of the investor relations website. Explanatory NoteOn March 7, 2025, Kestra completed its initial public offering of its Common Shares, par value $1.00 per share (the “Common Shares”). Kestra was formed solely for the purpose of completing the IPO and prior to the consummation of the IPO, did not engage in any business or activities other than those incidental to its formation, the organizational transactions consummated in connection with the IPO and the preparation of the prospectus and registration statement in connection with the IPO. Prior to the consummation of the IPO, the Company’s business was conducted through West Affum Intermediate Holdings Corp. In connection with the IPO, certain organizational transactions were completed, pursuant to which West Affum Intermediate Holdings Corp. became a wholly owned subsidiary of Kestra. West Affum Intermediate Holdings Corp is the predecessor to Kestra for financial reporting purposes. As such, the financial statements and the discussion of the Company’s financial results for the third quarter fiscal 2025 included in this press release represent the financial results of West Affum Intermediate Holdings Corp. and the financial statements of Kestra Medical Technologies, Ltd. are not included in this press release. Unless otherwise indicated or the context requires, “Kestra,” the “Company,” “we,” “our,” “us” and other similar terms refer collectively to West Affum Intermediate Holdings Corp. and its consolidated subsidiaries for periods prior to the consummation of the initial public offering, and to Kestra Medical Technologies, Ltd. and its consolidated subsidiaries for periods following the consummation of the initial IPO. Use of Non-GAAP Financial MeasuresThis press release contains certain financial information that is not presented in conformity with U.S. generally accepted accounting principles (“GAAP”), including adjusted EBITDA. The non-GAAP financial measures are provided as supplemental information to Kestra’s financial measures presented in this press release that are calculated and presented in accordance with GAAP. Adjusted EBITDA, which is calculated as net income (loss), as adjusted to exclude other income/expense (including interest), income tax expense (benefit), depreciation and amortization expense, stock-based compensation expense, and expenses related to Kestra’s initial public offering, is presented because management believes it allows investors to view the Company’s performance in a manner similar to the method used by management to evaluate the Company’s performance for both strategic and annual operating planning. Management believes that in order to properly understand short-term and long-term financial trends, it is helpful for investors to understand the impact of the items excluded from the calculation of Adjusted EBITDA, in addition to considering the Company’s GAAP financial measures. The excluded items vary in frequency and/or impact on our results of operations and management believes that the excluded items are not reflective of our ongoing core business operations and financial condition. Excluding such items allows investors and analysts to compare our operating performance to other companies in our industry and to compare our period-over-period results. The non-GAAP financial measures used by Kestra may not be the same or calculated in the same manner as those used and calculated by other companies. Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as a substitute for Kestra’s financial results prepared and reported in accordance with GAAP. We urge investors to review the reconciliation of these non-GAAP financial measures to the comparable GAAP financial measures included in this press release, and not to rely on any single financial measure to evaluate our business. A reconciliation of adjusted EBITDA reported in this press release to the most comparable GAAP measure for the respective periods appears in the table captioned “Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA” later in this release. Within the accompanying financial tables presented, certain columns and rows may not add due to the use of rounded numbers. Forward-Looking StatementsExcept where otherwise noted, the information contained in this press release is as of April 14, 2025. Statements in this press release and on the related teleconference that express a belief, expectation or intention, as well as those that are not historical fact, are forward-looking statements. Except as required by law, the Company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about, among other topics, our anticipated operating and financial performance, including financial guidance and projections; business plans, strategy, goals and prospects; and expectations for our products. Given their forward-looking nature, these statements involve substantial risks, uncertainties and potentially inaccurate assumptions, and we cannot ensure that any outcome expressed in these forward-looking statements will be realized in whole or in part. You can identify these statements by the fact that they use future dates or use words such as “will,” “may,” “could,” “likely,” “ongoing,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “assume,” “target,” “forecast,” “guidance,” “goal,” “objective,” “aim,” “seek,” “potential,” “hope” and other words and terms of similar meaning. Kestra’s financial guidance is based on estimates and assumptions that are subject to significant uncertainties. Among the factors that could cause actual results to differ materially from past results and future plans and projected future results are the following: risks related to our limited operating history and history of net losses; our ability to successfully achieve substantial market adoption of our products; competitive pressures; our ability to adapt our manufacturing and production capacities to evolving patterns of demand, governmental actions and customer trends; product defects or complaints and related liability; our ability to obtain and maintain adequate coverage and reimbursement levels for our products; our ability to comply with changing laws and regulatory requirements and resulting costs; our dependence on a limited number of suppliers; and other risks and uncertainties, including those described under the heading “Risk Factors” in our Registration Statement on Form S-1 and other filings filed or to be filed with the U.S. Securities and Exchange Commission (“SEC”). These filings, when made, are available on the Investor Relations section of our website at https://investors.kestramedical.com/ and on the SEC’s website at https://sec.gov/. About KestraKestra Medical Technologies, Ltd. is a commercial-stage wearable medical device and digital healthcare company focused on transforming patient outcomes in cardiovascular disease using monitoring and therapeutic intervention technologies that are intuitive, intelligent, and connected. For more information, visit www.kestramedical.com. WEST AFFUM INTERMEDIATE HOLDINGS CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts)(unaudited) January 31,2025 April 30,2024 Assets Current assets Cash and cash equivalents$54,352 $8,249 Accounts receivable, net 7,929 1,998 Disposable medical equipment supplies 5,999 3,290 Prepaid expenses and other current assets 1,636 1,370 Total current assets 69,916 14,907 Right-of-use assets 1,956 2,286 Deposits 2,058 1,710 Restricted cash 334 334 Property and equipment, net 31,387 26,105 Other long-term assets 2,344 607 Total assets$107,995 $45,949 Liabilities, Redeemable Preferred Stock and Stockholder’s Deficit Current liabilities Accounts payable$25,657 $23,892 Accrued liabilities 13,036 9,079 Total current liabilities 38,693 32,971 Operating lease liabilities, net of current portion 2,862 2,633 Other long-term liabilities 76 76 Long-term debt, net 43,749 42,536 Total liabilities 85,380 78,216 Commitments and contingencies Redeemable preferred stock, $0.01 par value; 5,000,000 shares authorized; 280,510 and 177,110 shares issued and outstanding as of January 31, 2025 and April 30, 2024, respectively 280,510 177,110 Stockholder’s deficit Common stock, $0.01 par value; 5,000,000 shares authorized; 105,808 shares issued and outstanding 1 1 Additional paid-in capital 194,142 197,057 Accumulated deficit (468,196) (406,435)Total West Affum Intermediate Holdings Corp. stockholder’s deficit (274,053) (209,377)Non-controlling interest 16,158 — Total stockholder’s deficit (257,895) (209,377)Total liabilities and stockholder’s deficit$107,995 $45,949 WEST AFFUM INTERMEDIATE HOLDINGS CORP. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except share and per share amounts)(unaudited) Three Months Ended January 31, Nine Months Ended January 31, 2025 2024 2025 2024 Revenue$15,090 $8,277 $42,582 $17,760 Costs of revenue 8,543 7,397 26,005 18,795 Gross margin 6,547 880 16,577 (1,035)Operating expenses: Research and development costs 3,353 3,735 10,266 11,669 Selling, general and administrative 23,795 17,091 64,477 52,010 Total operating expenses 27,148 20,826 74,743 63,679 Loss from operations (20,601) (19,946) (58,166) (64,714)Other expense (income): Interest expense 1,783 1,651 5,974 4,295 Interest income (628) — (1,543) — Other expense (income) (15) 8 73 2,776 Net loss before provision for income taxes (21,741) (21,605) (62,670) (71,785)Provision for income taxes 18 14 33 51 Net loss and comprehensive loss (21,759) (21,619) (62,703) (71,836)Net loss attributable to non-controlling interest (250) — (942) — Net loss and comprehensive loss attributable to West Affum Intermediate Holdings Corp. (21,509) (21,619) (61,761) (71,836)Less: Undeclared preferred stock dividends 3,324 1,812 9,030 4,727 Net loss attributable to common stockholder, basic and diluted$(24,833) $(23,431) $(70,791) $(76,563) Net loss per share attributable to common stockholder, basic and diluted$(1.25) $(1.18) $(3.56) $(3.85)Weighted-average shares of common stock outstanding, basic and diluted 19,885,382 19,885,382 19,885,382 19,885,382 RECONCILIATION OF GAAP NET LOSS AND COMPREHENSIVE LOSS TO ADJUSTED EBITDA(in thousands)(unaudited) Three Months Ended January 31, Nine Months Ended January 31, 2025 2024 2025 2024 GAAP Net loss and comprehensive loss$(21,759) $(21,619) $(62,703) $(71,836)Non-GAAP Adjustments: Interest expense 1,783 1,651 5,974 4,295 Interest income (628) — (1,543) — Other expense (income) (15) 8 73 2,776 Provision for income taxes 18 14 33 51 Depreciation expense 1,888 3,363 6,132 8,058 Stock-based compensation expense 459 372 1,958 1,099 IPO expense 1,927 — 1,927 — Adjusted EBITDA$(16,327) $(16,211) $(48,149) $(55,557) CONTACT: Investor contact
Neil Bhalodkar
neil.bhalodkar@kestramedical.com
