Financial Performance - Establishment Labs Holdings Inc. reported a quarterly loss of $0.59 per share, which was better than the Zacks Consensus Estimate of a loss of $0.61, and an improvement from a loss of $1.12 per share a year ago, indicating a 47.3% year-over-year improvement [1] - The company posted revenues of $40.23 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 0.92%, but showing an increase from $38.51 million in the same quarter last year [2] - The current consensus EPS estimate for the coming quarter is -$0.43 on revenues of $52.94 million, and for the current fiscal year, it is -$2.27 on revenues of $174.83 million [7] Market Performance - Establishment Labs shares have increased approximately 88.5% since the beginning of the year, significantly outperforming the S&P 500's gain of 24.3% [3] - The company has surpassed consensus EPS estimates three times over the last four quarters, indicating a positive trend in earnings performance [2] Industry Outlook - The Medical Services industry, to which Establishment Labs belongs, is currently ranked in the bottom 45% of over 250 Zacks industries, suggesting potential challenges ahead [8] - The performance of Establishment Labs' stock may be influenced by the overall outlook for the industry, as research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [8] Future Expectations - The sustainability of the stock's price movement will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The estimate revisions trend for Establishment Labs is currently mixed, resulting in a Zacks Rank 3 (Hold), indicating that shares are expected to perform in line with the market in the near future [6]

Financial Performance - Third quarter worldwide revenue was $40.2 million, an increase from $38.5 million in the same period of 2023[2] - Updated 2024 revenue guidance is now $165 million to $168 million, down from previous guidance of $174 million to $184 million[2] - Third quarter loss from operations was $13.1 million, improved from a loss of $21.0 million in the year-ago period[2] - Adjusted EBITDA loss for the third quarter was $7.0 million, compared to a loss of $16.3 million in the same period last year[2] - Net loss for the third quarter was $16.7 million, an improvement from a net loss of $29.3 million in the year-ago period[3] - Net loss for the three months ended September 30, 2024, was $16,682,000, an improvement from a net loss of $29,273,000 in the same period last year[12] - Adjusted EBITDA for the three months ended September 30, 2024, was $(7,017,000), compared to $(16,278,000) in the prior year, reflecting a significant improvement[12] Cash and Assets - Cash balance as of September 30, 2024, was $39.7 million, with a pro forma cash balance of approximately $114.0 million after recent financing activities[2] - Total current assets increased to $182,953,000 as of September 30, 2024, up from $174,901,000 at December 31, 2023, representing a growth of 1.6%[11] - Accounts receivable rose significantly to $67,251,000, compared to $46,918,000 in the previous period, marking an increase of 43.3%[11] - Cash balance slightly decreased to $39,697,000 from $40,035,000, a reduction of 0.8%[11] Expenses and Liabilities - Total operating expenses decreased to $38.9 million from $47.1 million in the third quarter of 2023[3] - Total liabilities decreased slightly to $249,975,000 from $250,246,000, indicating a reduction of 0.1%[11] - Interest expense increased to $5,313,000 for the three months ended September 30, 2024, compared to $3,679,000 in the same period last year, an increase of 44.4%[12] Inventory and Equity - Inventory decreased to $67,122,000 from $79,471,000, showing a decline of 15.6%[11] - Total shareholders' equity increased to $32,710,000 from $18,395,000, representing a growth of 77.8%[11] Future Outlook - The company expects U.S. revenue to exceed $35 million in 2025 following the successful launch of Motiva Implants[2] - An agreement in principle was reached for R-Bridge Fund to invest up to $50 million in a Chinese distributor to support Motiva's growth in China[2] Currency Impact - Foreign currency gain for the three months ended September 30, 2024, was $2,204,000, compared to a loss of $(3,816,000) in the same period last year[12] Gross Profit - Gross profit for the third quarter was $25.7 million, representing a gross margin of 63.9%, down from 67.7% in the same period of 2023[3]

Group 1 - Establishment Labs Holdings Inc (ESTA) shares increased by 9.25% on October 2, reaching an intraday high of $44.42 before closing at $44.31, up from a previous close of $40.56 [1] - The current stock price is 26.30% below its 52-week high of $60.12 and 161.26% above its 52-week low of $16.96 [1] - Trading volume was 358,355 shares, which is 103.1% of the average daily volume of 347,701 [1] Group 2 - Wall Street analysts have set an average target price of $63.80 for Establishment Labs Holdings Inc, with a high estimate of $75.00 and a low estimate of $45.00, indicating a potential upside of 43.99% from the current price [2] - The average brokerage recommendation for Establishment Labs Holdings Inc is 1.8, suggesting an "Outperform" status on a scale where 1 is Strong Buy and 5 is Sell [2] - GuruFocus estimates the GF Value for Establishment Labs Holdings Inc at $82.42 in one year, indicating a potential upside of 86.01% from the current price [2]

Revenue Performance - Revenue for the six months ended June 30, 2024, was $81.3 million, a decrease of $13.8 million or 14.5% compared to $95.1 million in the same period of 2023[116] - Revenue decreased by $4.5 million, or 9.3%, to $44.1 million for the three months ended June 30, 2024, compared to $48.6 million for the same period in 2023[132] - The second half of fiscal year 2023 showed a slowdown in revenue growth due to macroeconomic conditions, with a 19% quarter-over-quarter increase in revenue observed in the latest quarter[127] - Sales of Motiva Implants accounted for over 99% of total revenues for the six months ended June 30, 2024[119] - The company expects revenue to increase as it enters new markets and launches Motiva Implants in the U.S., pending FDA approval[120] Net Losses and Financial Position - Net losses for the six months ended June 30, 2024, were $33.4 million, compared to $28.7 million for the same period in 2023, resulting in an accumulated deficit of $393.5 million[116] - The net loss for the six months ended June 30, 2024, was $33.4 million, influenced by changes in operating assets and liabilities[153] - Other income (expense), net decreased to a loss of $5.8 million for the six months ended June 30, 2024, compared to an income of $2.1 million for the same period in 2023[149] Operating Expenses and Cost Management - Total operating expenses decreased by $10.7 million, or 13.0%, to $71.5 million for the six months ended June 30, 2024[144] - Operating expenses decreased by $5.7 million, or 12.9%, to $38.3 million for the three months ended June 30, 2024, compared to $44.0 million for the same period in 2023[134] - SG&A expense decreased by $4.2 million, or 11.4%, to $32.8 million for the three months ended June 30, 2024[135] - R&D expense decreased by $1.4 million, or 20.3%, to $5.5 million for the three months ended June 30, 2024[137] - The company has implemented measures to align its cost base with current demand, including workforce downsizing and operational expenditure reductions[127] Manufacturing and Product Development - The FDA granted 510(k) clearance for the Motiva Flora SmoothSilk Tissue Expander in October 2023, following the commercial launch of Motiva Implants in China in January 2024[115][117] - The company completed the construction of a new manufacturing facility in Costa Rica, increasing manufacturing capacity by approximately 730,000 units per year, with costs incurred of approximately $56.0 million[117] - The IDE clinical trial for Motiva Implants is expected to cost between $30.0 million and $40.0 million over ten years, with approximately $31.5 million spent to date[123] - The company is developing an enterprise resource planning system for the anticipated U.S. launch of Motiva Implants, incurring $4.8 million in costs for intangible assets[155] Interest and Financing Activities - Interest expense as of June 30, 2024, was $9.6 million, reflecting an increase from $7.4 million in the same period of 2023[129] - Interest expense increased to $9.6 million for the six months ended June 30, 2024, compared to $7.4 million for the same period in 2023[147] - Cash flows from financing activities provided $51.4 million in the first half of 2024, primarily from the issuance of common shares and pre-funded warrants, compared to $85.7 million in the same period of 2023[156] - As of June 30, 2024, the company had $196.4 million outstanding under the Credit Agreement, which includes $150 million for the Tranche A Term Loan and $25 million for the Tranche B Term Loan[158] Future Outlook and Capital Requirements - The company anticipates future capital requirements will depend on market adoption of its products, regulatory activities, and R&D costs[151] - The company filed a Shelf Registration Statement in April 2023, allowing it to raise additional capital through common shares and other securities until April 2026[151] - The company’s liquidity assumptions may prove incorrect, potentially requiring the use of available financial resources sooner than expected[151]

Financial Data and Key Metrics - Revenue for Q2 2024 totaled $44.1 million, an 18.7% sequential increase from Q1 2024 [4] - Year-over-year revenue declined by 9.3%, or 8.5% excluding foreign exchange impact [15] - Gross profit for Q2 2024 was $28.9 million, representing a gross margin of 65.6%, up from 62.3% in Q2 2023 [16] - Adjusted EBITDA loss was $4.3 million, similar to Q1 2024 but less than half of the $9.3 million loss in Q2 2023 [7][18] - Net loss from operations was $9.3 million, compared to $13.7 million in Q2 2023 [17] - Cash used in Q2 2024 was $18.4 million, with a cash position of $54.6 million as of June 30, 2024 [18][19] Business Line Performance - **Motiva Implants**: The company is nearing FDA approval, with manufacturing preparations underway for the US launch [7][29] - **Flora Tissue Expanders**: Gaining traction in the US, with VAC processes completed at several premier cancer centers [11] - **Mia Femtech**: Now available in 22 cities globally, with 63 certified plastic surgeons and 41 clinics in active negotiations [13][31] - **China**: On track to achieve $10 million in revenue for 2024, with ongoing medical education and marketing efforts [13][48] Regional Performance - **EMEA**: Contributed 48% of global revenue, with several markets fully recovered from last year's slowdown [6][16] - **Asia-Pacific**: Represented 32% of global revenue, showing improved demand as distributors reordered inventory [16][55] - **Latin America**: Contributed 20% of global revenue, with Brazil remaining weak and no significant recovery expected this year [6][16] - **North America**: Less than 1% of global revenue, but significant growth expected post-FDA approval [16][22] Strategic Direction and Industry Competition - The company is preparing for the US launch of Motiva Implants, which is expected to be a game-changer in the breast implant market [8][10] - The US market offers higher ASPs (3x to 4x higher than other markets), which will significantly boost profitability [22] - FDA approval is seen as a catalyst for global sales, as many surgeons outside the US rely on FDA clearance as a gold standard [22][36] - The company is focused on expanding its presence in China, aiming for market leadership in the coming years [13][49] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in achieving FDA approval soon, with no significant impact expected from the recent FDA inspection observations [5][25] - The company expects revenue growth to accelerate significantly in 2025, driven by the US launch and expansion in other markets [20][22] - Positive adjusted EBITDA and cash flow are expected soon after the US launch, with profitability targeted by fiscal year 2026 [21] Other Important Information - The company has two remaining tranches of $50 million in debt, accessible upon FDA approval and achieving $195 million in trailing 12-month sales [19] - Inventory days improved to more normalized levels, and days payable decreased in Q2 2024 [18] - Accounts receivable increased due to higher sales through distributors, but DSOs remained flat compared to Q1 2024 [18] Q&A Session Summary Question: Guidance and US Revenue Inclusion [24] - The company reiterated its 2024 revenue guidance of $174 million to $184 million, reflecting confidence in US approval and stable performance in other regions, despite weakness in Brazil [24] Question: FDA 483 Observations and Approval Timeline [25][26] - The FDA inspection resulted in three minor, non-systemic observations, which the company has already addressed, with no expected impact on the approval timeline [25][26] Question: US Launch Preparation and Sales Team [28][29] - The company has built an all-star team for the US launch, with back-office functions ready and initial batches of Motiva Implants already manufactured [29] Question: Mia Femtech Growth and Clinic Dynamics [30][31] - Mia Femtech is expanding rapidly, with 47% of Q2 patients being new to breast augmentation, indicating market expansion [31] Question: US Surgeon Awareness and Adoption [33][34] - Awareness of Motiva Implants among US plastic surgeons is growing, with strong interest driven by the product's safety profile and innovation [33][34] Question: International Adoption Post-FDA Approval [35][36] - FDA approval is expected to drive adoption in CE Mark countries, where many surgeons await FDA clearance before using new products [35][36] Question: Gross Margin Trajectory [38][39] - Gross margins improved in Q2 2024 due to higher ASPs, with further improvements expected as the US launch and other initiatives contribute to profitability [38][39] Question: Mia Licensing Fees and Revenue Growth [41][42] - Licensing fees for Mia Femtech are expected to grow as more clinics are onboarded, with significant revenue potential as clinics reach their case targets [41][42] Question: Accounts Receivable Increase [44][45] - The increase in accounts receivable was due to higher sales through distributors, particularly in Asia-Pacific, with no unusual factors [44][45] Question: China Market Growth [48][49] - The company remains on track for $10 million in revenue in China for 2024, with aspirations for market leadership in the coming years [48][49] Question: Q3 Seasonality and Distributor Reordering [52][53][54][55] - Q3 revenue is expected to decline by 10% sequentially, with a strong recovery anticipated in Q4, driven by US approval and distributor reordering [52][53][54][55] Question: Distributor Inventory Levels [55][56] - Distributors in Asia-Pacific are reordering at a healthy pace, indicating market recovery, while Latin America remains challenging due to political and economic factors [55][56]

Core Viewpoint - Establishment Labs Holdings Inc. reported a quarterly loss of $0.62 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.52, indicating a negative earnings surprise of -19.23% [1] Financial Performance - The company posted revenues of $44.12 million for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 1.85%, but down from $48.56 million in the same quarter last year [2] - Over the last four quarters, Establishment Labs has exceeded consensus EPS estimates two times and topped consensus revenue estimates three times [2] Stock Performance - Establishment Labs shares have increased approximately 32.9% since the beginning of the year, significantly outperforming the S&P 500's gain of 8.7% [3] Future Outlook - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the next quarter is -$0.41 on revenues of $46.42 million, and for the current fiscal year, it is -$1.80 on revenues of $179.45 million [7] Industry Context - The Medical Services industry, to which Establishment Labs belongs, is currently ranked in the bottom 41% of over 250 Zacks industries, which may impact the stock's performance [8]

This company is expected to post quarterly loss of $0.52 per share in its upcoming report, which represents a year-over-year change of +20%. Revenues are expected to be $43.32 million, down 10.8% from the year-ago quarter. The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> Establishment Labs scored a strong price increase driven by investors' optimism, following its recent presentation at two investor conferences. In the f ...

☐ 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: 001-38593 Establishment Labs Holdings Inc. (Exact name of Registrant as specified in its charter) 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 March 31, 2024. OR British ...

Financial Data and Key Metrics - Total revenue for Q1 2024 was $37.2 million, a 20% decline year-over-year [75] - Gross profit for Q1 2024 was $24.4 million, or 65.6% of revenue, compared to $30.1 million or 64.7% in Q1 2023 [43] - Adjusted EBITDA improved to a loss of $3.7 million in Q1 2024, compared to a loss of $17.3 million in Q4 2023 and $4 million in Q1 2023 [50] - Operating expenses decreased to $33.2 million in Q1 2024, down $5 million year-over-year and $9.5 million sequentially [2] - SG&A expenses declined to $28.9 million in Q1 2024, down $2.8 million year-over-year and $8 million sequentially [49] - R&D expenses decreased to $4.3 million in Q1 2024, down $2.2 million year-over-year and $1.5 million sequentially [49] - Net loss from operations was $8.8 million in Q1 2024, compared to $8.2 million in Q1 2023 and $22.1 million in Q4 2023 [50] Business Line Data and Key Metrics - Direct sales accounted for 39% of implant sales in Q1 2024, with distributors making up the balance [75] - Mia Femtech has 55 clinics signed up, with 33 operating and 22 in the onboarding process [41] - Mia Femtech added centers in the Middle East and Latin America in Q1 2024, with clinics now in Riyadh, Jeddah, Dubai, Abu Dhabi, Beirut, and San Jose [41] - Flora tissue expander is gaining traction in the U.S. market, with adoption expected to grow throughout 2024 [46] - Motiva implants launched in China in Q1 2024, with strong early reception and aggressive marketing strategies in Tier 1 and Tier 2 cities [42] Market Data and Key Metrics - Europe, Middle East, and Africa accounted for 55% of global sales in Q1 2024, Asia Pacific 21%, and Latin America 23% [75] - Brazil, the largest market globally, accounted for 11% of total quarterly sales [75] - Demand in Latin America is lagging, with slower recovery expected compared to other regions [29] - China's market is recovering, with expectations to return to 2019 levels by 2025, potentially accelerated by stimulus packages [60] Company Strategy and Industry Competition - The company aims to achieve adjusted EBITDA positivity by the end of 2024 and cash flow positivity by the end of 2025, excluding U.S. investments [76] - The pending U.S. launch of Motiva implants is a key focus, with high confidence in approval in 2024 [74] - The company is building a strong commercial foundation for the U.S. launch, including hiring experienced leaders and expanding the sales force [79] - Mia Femtech is creating a new minimally invasive category in breast aesthetics, with significant market expansion potential [47] Management Commentary on Operating Environment and Future Outlook - The company sees steady recovery in markets, with improving demand in both direct and distributor channels [44] - Management expects sequential improvement in demand throughout 2024, with distributor orders returning to normalized levels [28] - The company is optimistic about achieving $1 million revenue per Mia clinic, with early clinics trending toward this goal [14] - The U.S. market for breast aesthetics is normalizing post-pandemic, with expectations for continued recovery [31] Other Important Information - The company received an investigational device exemption from the FDA for Motiva Implants and is undergoing a clinical trial for U.S. approval [24] - The 4-year data from the Motiva U.S. IDE study showed low complication rates, with only 2 cases of capsular contracture and 1 suspected rupture [45] - The company has $73 million in cash as of March 31, 2024, with access to an additional $50 million in debt facilities upon FDA approval and sales milestones [63] Q&A Session Question: Underlying assumptions and guidance [28] - The company expects sequential improvement in demand, with distributor orders returning to normalized levels and direct markets performing better [28] Question: Direct market trends and guidance assumptions [30] - Management feels confident about trending toward the upper end of the revenue guidance range for 2024, with similar sequential improvement expected in Q2 [30] Question: International distributor inventory levels [55] - Distributor inventory levels are normalizing, with demand improving globally, except in Latin America, where recovery is slower [29] Question: U.S. market health and Motiva launch [57] - The U.S. market is normalizing post-pandemic, with expectations for continued recovery, positioning the company well for the Motiva launch in late 2024 [31] Question: FDA inspection process and China stimulus impact [33] - The FDA inspection of the Costa Rica facility is scheduled within 30 days, with high confidence in U.S. approval in 2024 [7] - The China stimulus package is seen as a positive development, potentially accelerating market recovery [60] Question: Mia Femtech revenue contribution and clinic expansion [89] - The company has signed up 55 Mia clinics, with 33 operating and 37 under negotiation, aiming for 100 clinics by year-end [89] - Early clinics are trending toward $1 million revenue per clinic, with expectations for significant market expansion [14] Question: China market share and revenue expectations [67] - The company expects to match its market share in surrounding Asian countries (40%-70%) in China over the next few years [67] - Early results in China are tracking as expected, with strong reception for Motiva implants [42] Question: U.S. go-to-market strategy and sales force build-out [88] - The company is building a strong commercial foundation for the U.S. launch, including hiring experienced leaders and expanding the sales force [79] Question: International recon franchise traction [87] - Flora tissue expander is gaining traction in the U.S., with adoption expected to grow, while international recon traction is slower due to hospital tender processes [83] Question: Mia Femtech revenue breakout and clinic maturity [89] - The company is focused on qualitative growth for Mia Femtech, with revenue expected to become more material as the network of clinics expands [89]

Establishment Labs Holdings Inc. (ESTA) came out with a quarterly loss of $0.58 per share versus the Zacks Consensus Estimate of a loss of $0.65. This compares to loss of $0.48 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 10.77%. A quarter ago, it was expected that this company would post a loss of $0.95 per share when it actually produced a loss of $0.79, delivering a surprise of 16.84%.Over the last four quarters, the com ...