Orthofix(US:OFIX)2024-11-07 12:08Financial Performance - Total net sales for the three months ended September 30, 2024, were $196.606 million, an increase of 6.5% compared to $184.006 million for the same period in 2023[9] - Gross profit for the nine months ended September 30, 2024, was $397.044 million, representing a 13.5% increase from $349.643 million for the same period in 2023[9] - The company reported a net loss of $27.388 million for the three months ended September 30, 2024, compared to a net loss of $28.857 million for the same period in 2023, indicating a reduction in losses[9] - Net sales for the three months ended September 30, 2024, reached $196,606 thousand, a 6.8% increase from $184,006 thousand in the same period of 2023[42] - Net sales for the nine months ended September 30, 2024, reached $583,834 thousand, up 6.9% from $546,226 thousand in the prior year[51] - Adjusted EBITDA for the three months ended September 30, 2024, was $30,066 thousand, compared to $23,070 thousand in the same period of 2023, reflecting a significant increase[48] Assets and Liabilities - Total current assets decreased to $386.214 million as of September 30, 2024, down from $420.443 million as of December 31, 2023, reflecting a decline of approximately 8.1%[6] - Total liabilities increased to $341.948 million as of September 30, 2024, compared to $326.585 million as of December 31, 2023, marking an increase of about 4.7%[7] - The company’s total assets decreased to $867.872 million as of September 30, 2024, from $925.315 million as of December 31, 2023, a decline of approximately 6.2%[6] - The Company’s total indebtedness increased from $94.4 million on December 31, 2023, to $118.5 million on September 30, 2024[25] Shareholder Equity and Shares - Total shareholders' equity as of September 30, 2023, was $615,483 thousand, a decrease from $639,985 thousand as of June 30, 2023[11] - Common shares outstanding increased to 36,750 thousand as of September 30, 2023, from 36,733 thousand as of June 30, 2023[11] - The weighted average number of common shares outstanding for the three months ended September 30, 2024, was 38.488 million, compared to 37.249 million for the same period in 2023[9] - The company reported a total of 38,488 thousand weighted average common shares for basic EPS for the three months ended September 30, 2024, compared to 37,249 thousand in 2023[60] Expenses - Research and development expenses for the three months ended September 30, 2024, were $17.294 million, slightly down from $18.559 million for the same period in 2023[9] - Share-based compensation expense for the nine months ended September 30, 2023, was $25,290 thousand, down from $32,540 thousand for the same period in 2022[12] - Share-based compensation expense for the three months ended September 30, 2024, was $6,531 thousand, slightly up from $6,274 thousand in the same period of 2023[54] Cash Flow - Cash provided by operating activities was $2,060 thousand for the nine months ended September 30, 2023, compared to cash used in operating activities of $39,059 thousand for the same period in 2022[12] - The company reported a cash balance of $30,054 thousand at the end of the period, down from $33,663 thousand at the beginning of the period[12] Acquisitions and Mergers - The Company completed an all-stock merger with SeaSpine on January 5, 2023, converting each share of SeaSpine common stock into 0.4163 shares of Orthofix common stock[19] - The fair value of identifiable assets acquired from SeaSpine was $377.4 million, with net identifiable assets acquired totaling $253.1 million[20] - SeaSpine generated net sales of $72.1 million and $214.1 million for the three and nine months ended September 30, 2024, respectively, compared to $62.9 million and $188.2 million for the same periods in 2023[20] Legal Matters - The Company is involved in various lawsuits, including arbitration claims from former executives, but believes any potential losses are immaterial[36] - The Company has received securities class action complaints alleging violations of the Securities Exchange Act, but intends to defend against these claims vigorously[37][38] Accounting Changes - The company adopted ASU 2022-03 effective January 1, 2024, which clarifies fair value measurement for equity securities subject to contractual sale restrictions[15] - The company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statements, which enhances income tax disclosures[18] Market Performance - The U.S. market contributed $166,640 thousand to consolidated net sales for the three months ended September 30, 2024, compared to $153,246 thousand in the same period of 2023[50] - Global Spine segment net sales were $166,104 thousand, up 7.6% from $154,352 thousand year-over-year, driven by Bone Growth Therapies and Spinal Implants[42] - The Global Orthopedics segment reported net sales of $30,502 thousand, a 2.9% increase from $29,654 thousand year-over-year[42] Other Financial Metrics - The allowance for expected credit losses at the end of September 30, 2024, was $7,878 thousand, compared to $7,090 thousand at the end of September 30, 2023[44] - The Company experienced a write-off of $1,118 thousand against the allowance for expected credit losses during the three months ended September 30, 2024[44] - The Company recorded a loss before income taxes of $(26,637) thousand for the three months ended September 30, 2024, compared to $(28,385) thousand in the same period of 2023[48]