Surmodics(US:SRDX)2024-07-31 12:00Revenue Performance - Revenue in Q3 fiscal 2024 was $30.3 million, a decrease of $22.1 million or 42% compared to the prior-year quarter [145]. - Medical Device segment revenue was $23.4 million in Q3 fiscal 2024, a 49% decrease from $46.0 million in the prior-year quarter [146]. - SurVeil DCB license fee revenue under the Abbott Agreement decreased by $24.7 million in Q3 fiscal 2024 compared to the prior-year quarter [155]. - Medical Device R&D services revenue decreased $0.4 million year-over-year in Q3 fiscal 2024 [156]. - The company anticipates future revenue growth and plans to evaluate its strategy for further clinical investment in the Sundance DCB [207]. Sales and Profitability - Medical Device product sales increased 15% to $10.7 million in Q3 fiscal 2024, compared to $9.3 million in the prior-year quarter [146]. - Performance coating royalties and license fee revenue increased 13% to $9.3 million in Q3 fiscal 2024, compared to $8.3 million in the prior-year quarter [146]. - Product gross profit increased $0.4 million or 4% in Q3 fiscal 2024, with product gross margins at 51.9% [149]. - Medical Device operating loss was $(2.3) million in Q3 fiscal 2024, compared to operating income of $21.8 million in the prior-year quarter [155]. Expenses - SG&A expense increased 29% or $3.8 million in Q3 fiscal 2024, compared to the prior-year quarter, with SG&A as a percentage of revenue at 55% [151]. - The company expects SG&A expense to increase for full-year fiscal 2024 primarily due to merger-related charges [151]. Cash Flow and Investments - Cash used in investing activities totaled $(12.4) million in the first nine months of fiscal 2024, compared to $(2.2) million in the same prior-year period [159]. - Net purchases and maturities of available-for-sale investments were $(9.4) million in the first nine months of fiscal 2024, compared to $0.0 million in the same period of fiscal 2023 [159]. - The company invested $(3.0) million in property and equipment in the first nine months of fiscal 2024, up from $(2.2) million in the same period of fiscal 2023 [159]. Debt and Interest - As of June 30, 2024, the outstanding balance on the revolving credit facility was $5 million, with additional availability of approximately $15.0 million [160]. - The company expects total interest expense under the credit agreement with MidCap to be approximately $3.5 million in fiscal 2024 [160]. - The outstanding principal on the term loan was $25 million as of June 30, 2024, with potential additional draws up to $50 million through December 31, 2024 [160]. - The interest rate on the term loan is fixed at 10.205% per annum for the initial $25 million borrowing due to an interest rate swap arrangement [205]. Merger Considerations - The company may incur a termination fee of $20,380,000 if the Merger Agreement is terminated under certain circumstances [207]. Raw Material Prices - Management believes that a reasonable change in raw material prices would not have a material impact on future earnings or cash flows [211].