Core Viewpoint - Avanos Medical, Inc. reported a challenging financial performance for the fourth quarter and full year of 2024, with significant losses attributed to transformation initiatives and impairment charges, while maintaining a focus on organic growth and cash flow generation [2][19]. Financial Highlights - Fourth quarter net sales reached $179.6 million, a 3.6% increase year-over-year, driven by strong performance in the digestive health portfolio and interventional pain portfolio [5][10]. - For the full year 2024, net sales from continuing operations increased by 2.2% to $687.8 million [11]. - The company generated $83 million in free cash flow for the year, with fourth quarter free cash flow of $53.1 million, a significant improvement from an outflow of $3.4 million in the previous year [2][15]. Operating Results - The gross margin for the fourth quarter was 54.6%, slightly down from 54.8% a year ago, while the adjusted gross margin improved to 58.7% [6][11]. - Operating loss for the fourth quarter was $418.5 million, compared to an operating profit of $11.2 million in the same quarter of 2023, primarily due to a goodwill impairment charge of $436.7 million [8][14]. - Adjusted EBITDA for the fourth quarter was $28.6 million, down from $32.1 million in the prior year [8]. Earnings Per Share - Fourth quarter diluted loss per share from continuing operations was $8.63, compared to earnings of $0.24 per share a year ago [10]. - For the full year, diluted loss per share from continuing operations was $8.40, compared to a loss of $0.21 in 2023, while adjusted diluted earnings per share improved to $1.35 from $1.03 [10][13]. Cash Flow and Balance Sheet - As of December 31, 2024, the company's cash balance was $107.7 million, up from $87.7 million at the end of 2023, with total debt of $134.7 million [16]. - Net debt decreased to $27 million from $80.3 million in the prior year, reflecting improved cash flow management [10]. 2025 Outlook - The company expects net sales for 2025 to be between $665 million and $685 million, with adjusted diluted earnings per share projected between $1.05 and $1.25 [18][19]. - The guidance reflects anticipated challenges in certain product categories and currency headwinds, with a commitment to long-term strategy and margin improvement [19].

Core Points - Avanos Medical, Inc. will host a conference call on February 26, 2025, at 9 a.m. ET to discuss its financial results and business highlights for Q4 and full year 2024 [1] - A news release detailing the financial results will be issued before the market opens on the same day [1] - The call will be led by Michael Greiner, interim CEO, and Scott Galovan, senior VP of strategy and corporate development [1] Access Information - Participants can join the conference call by registering through a provided link or by dialing specific phone numbers [2] - A simultaneous webcast will be available on the Avanos Medical website, with a replay accessible within two hours after the call [3] Company Overview - Avanos Medical is a medical technology company focused on providing clinically superior medical device solutions [4] - The company aims to address significant healthcare needs, including nutrition support for patients and reducing opioid use during recovery [4] - Avanos develops, manufactures, and markets its products globally, holding leading market positions in various categories [4]

Company Overview - Avanos Medical (AVNS) shares increased by 7.2% to $16.95, with a notable trading volume, contrasting with a 0.7% loss over the past four weeks [1] - The company is experiencing growing market optimism due to its strategic positioning in the medical device sector, impressive revenue growth, and consistent profitability [2] Financial Performance - Avanos is expected to report quarterly earnings of $0.40 per share, reflecting an 11.1% year-over-year increase, with revenues projected at $177.72 million, a 2.6% rise from the previous year [3] - The consensus EPS estimate for Avanos has remained unchanged over the last 30 days, indicating stability in earnings expectations [4] Market Sentiment - The recent surge in Avanos' stock price is attributed to increased demand for its advanced medical solutions and ongoing investments in product innovation [2] - Investors are optimistic about Avanos' ability to capture market share and drive future earnings growth as the healthcare sector prioritizes innovative and cost-effective solutions [2] Industry Context - Avanos Medical is part of the Zacks Medical - Instruments industry, which includes other companies like Alcon (ALC), that also experienced a stock increase of 2.7% [4] - Alcon's consensus EPS estimate has seen a slight decrease of 0.4% over the past month, indicating a stable outlook similar to Avanos [5]

Core Viewpoint - Avanos Medical, Inc. is positioned for growth due to its strong product line and focus on research and development, despite facing macroeconomic challenges and foreign exchange volatility [1][12][13] Company Performance - For the year-to-date period, Avanos' stock has decreased by 29.8%, while the industry rose by 3.5% and the S&P 500 grew by 12.1% [1] - The company reported a market capitalization of $744.5 million and an earnings yield of 10.7%, which is favorable compared to the industry's negative yield [2] Growth Drivers - Avanos has a solid product portfolio, particularly in Digestive Health and Pain Management, which includes products like MIC-KEY enteral feeding tubes and non-opioid pain solutions [3] - The Digestive Health segment showed strength with double-digit growth in the NeoMed product line and strong demand for ENFit conversions in North America [4][10] - The legacy enteral feeding business maintained healthy growth, and the company anticipates continued above-market growth due to product innovations and global market expansion [5] Sales and Revenue Insights - In Q3 2024, net sales decreased by 0.5% to $170.4 million, but organic sales increased by 1.1% despite unfavorable foreign currency translation effects [14] - The Pain Management and Recovery segment saw normalized organic sales rise approximately 1%, with growth in ambIT partially offsetting supplier constraints affecting On-Q growth [6] Research and Development Focus - Avanos is committed to R&D, with expenses increasing by 18% year over year to $7.2 million in Q3 2024, aiming to enhance product efficiency and security [9] Future Outlook - The Zacks Consensus Estimate for Avanos' earnings in 2025 has improved by nearly 3% to $1.73 per share, with first-quarter 2025 revenue estimates at $173.5 million, indicating a 4.5% year-over-year improvement [15]

Group 1 - Avanos Medical, Inc. (AVNS) has been added to the Zacks Rank 5 (Strong Sell) List, with a 5% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Atlanta Braves Holdings, Inc. (BATRK) is also on the Zacks Rank 5 (Strong Sell) List, experiencing a significant 187.1% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [1] - Elevance Health, Inc. (ELV) has seen a 10.9% downward revision in the Zacks Consensus Estimate for its current year earnings over the last 60 days [2]

Core Viewpoint - Avanos Medical, Inc. will have its interim CEO, Michael Greiner, participate in an analyst-led fireside chat at the Stifel 2024 Healthcare Conference on November 19, 2024 [1] Company Overview - Avanos Medical, Inc. is a medical technology company headquartered in Alpharetta, Georgia, focused on delivering clinically superior medical device solutions [3] - The company addresses critical healthcare needs, including providing nutrition support for patients transitioning from hospital to home and reducing opioid use during recovery [3] - Avanos develops, manufactures, and markets recognized brands globally, holding leading market positions across multiple categories [3]

Core Viewpoint - Avanos Medical, Inc. has received confirmation from the Centers for Medicare and Medicaid Services (CMS) regarding the inclusion of its ON-Q and ambIT infusion pumps under the Non-Opioids Prevent Addiction in the Nation (NOPAIN) Act, allowing for separate Medicare reimbursement starting January 1, 2025 [1][3][6]. Group 1: NOPAIN Act Implementation - The NOPAIN Act, part of the Consolidated Appropriation Act of 2023, aims to enhance patient access to non-opioid pain management solutions by providing additional Medicare reimbursement for qualifying non-opioid drugs and devices [2]. - CMS has confirmed that the ON-Q and ambIT infusion pumps meet the qualifying requirements for separate payment under the NOPAIN Act, marking a significant milestone for Avanos Medical [3][4]. - The payment limitation for both the ON-Q and ambIT infusion systems is set at up to $2,284.98, with unique HCPCS codes assigned for claim submissions starting January 1, 2025 [5]. Group 2: Impact on Pain Management - The NOPAIN Act mandates separate payment for qualified non-opioid treatments through December 31, 2027, when provided with a covered surgical procedure, aiming to reduce opioid reliance in postoperative care [6]. - The ON-Q and ambIT devices are the first and only infusion pain pumps included under this policy, which is part of a broader strategy by CMS to combat the opioid crisis [6]. - Avanos Medical's interim CEO highlighted the effectiveness of the ON-Q and ambIT pumps in reducing opioid use post-surgery, supported by clinical trials and peer-reviewed data [7].

Core Insights - Avanos Medical, Inc. has launched the CORGRIP SR Nasogastric/Nasointestinal Tube Retention System, enhancing its Enteral Feeding portfolio [1][2] - The new system is designed to reduce the risk of dislodgement and complications associated with nasal tube replacement, offering advantages over traditional tape methods [2][3] Product Features - The CORGRIP SR system features a monofilament thread and includes a yellow tipped retrieval catheter with a hollow tip, color-coded clips, printed centimeter markings, and a unique orange opening tool [2] - Research indicates that 40%-63% of feeding tubes secured with tape can become inadvertently dislodged, while using a bridle significantly reduces this incidence [3] Company Overview - Avanos Medical is a medical technology company headquartered in Alpharetta, Georgia, focused on delivering clinically superior solutions for patient care [4] - The company aims to address critical healthcare needs, including providing nutrition to patients and reducing opioid use during recovery [4]

Core Viewpoint - Avanos Medical, Inc. reported a mixed performance in Q3 2024, with adjusted EPS showing a year-over-year increase, but revenues declining slightly, indicating challenges in certain product lines while maintaining strength in others [1][2][12]. Financial Performance - Adjusted EPS from continuing operations was 36 cents, a 20% increase year over year, meeting the Zacks Consensus Estimate [1] - Revenues totaled $170.4 million, down 0.5% year over year, missing the Zacks Consensus Estimate by 2.7% [2] - Organic sales increased by 1.1% year over year [2]. Segment Analysis - Pain Management and Recovery segment reported net revenues of $72.2 million, a decrease of 5.4% year over year [6] - Digestive Health segment saw net revenues of $98.2 million, improving by 3.4% year over year, with organic growth of almost 3% [6][7]. Margin Analysis - Gross profit fell by 2.7% to $92.9 million, with gross margin contracting by 130 basis points to 54.5% [8] - Selling and general expenses decreased by 5.6% to $74.3 million, while research and development expenses increased by 18% year over year to $7.2 million [8]. Financial Update - Cash and cash equivalents at the end of Q3 were $89 million, down from $92.2 million at the end of Q2 [10] - Total debt decreased to $162 million from $175.1 million at the end of Q2 [10]. Guidance - The company expects net sales for the full year 2024 to be in the range of $683-$688 million, below the Zacks Consensus Estimate of $695.1 million [11] - Adjusted EPS for 2024 is anticipated to be between $1.30 and $1.45, with the Zacks Consensus Estimate at $1.39 [11]. Market Performance - Avanos shares have declined by 17.1% year to date, contrasting with the industry growth of 5.4% and the S&P 500 Index gain of 22.5% [4].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ________ to ________ Commission file number 001-36440 AVANOS MEDICAL, INC. (Exact name of registrant as specified in its charter) Delaware 46-4987888 (Sta ...