ZimVie (ZIMV) - 2025 Q1 - Quarterly Results

Financial Performance and Outlook This section details ZimVie's first quarter 2025 financial results and provides full-year 2025 financial guidance First Quarter 2025 Financial Results ZimVie reported a 5.2% decrease in net sales to $112.0 million for Q1 2025, but showed significant profitability improvements, with net loss narrowing to $(2.6) million and adjusted EBITDA increasing to $17.6 million - The company entered 2025 with a strong focus on execution and operational diligence, aiming to improve operational efficiency and profitability while working towards a return to top-line growth[3] Q1 2025 Financial Performance vs. Q1 2024 (Continuing Operations) | Financial Metric | Q1 2025 | Q1 2024 | Change | Change (%) | | :--- | :--- | :--- | :--- | :--- | | Net Sales | $112.0M | $118.2M | -$6.2M | -5.2% | | Net Loss | $(2.6)M | $(11.5)M | +$8.9M | N/A | | Net Loss Margin | (2.3)% | (9.7)% | +740 bps | N/A | | Adjusted Net Income | $7.4M | $2.2M | +$5.2M | +236% | | Adjusted EBITDA | $17.6M | $12.5M | +$5.1M | +40.8% | | Adjusted EBITDA Margin | 15.7% | 10.5% | +520 bps | N/A | | Diluted EPS | $(0.09) | $(0.42) | +$0.33 | N/A | | Adjusted Diluted EPS | $0.27 | $0.08 | +$0.19 | +237.5% | Full Year 2025 Financial Guidance The company provides its financial outlook for the full year ending December 31, 2025, projecting net sales between $445 million and $460 million and adjusted EPS in the range of $0.80 to $0.95 Full Year 2025 Financial Guidance (Continuing Operations) | Metric | Guidance Range | | :--- | :--- | | Net Sales | $445M to $460M | | Adjusted EBITDA | $65M to $70M | | Adjusted EPS | $0.80 to $0.95 | - The forward-looking guidance for Adjusted EBITDA and Adjusted EPS are non-GAAP financial measures, with reconciliation to GAAP measures not available without unreasonable efforts[8] Consolidated Financial Statements This section presents ZimVie's consolidated financial statements, including the statement of operations, balance sheets, and cash flows for the reported periods Consolidated Statement of Operations For the first quarter of 2025, ZimVie reported an operating profit of $0.78 million, a significant turnaround from an operating loss of $(2.73) million in the prior-year period, with net loss from continuing operations improving to $(2.63) million Statement of Operations Highlights (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Sales | $111,997 | $118,195 | | Operating Profit (Loss) | $780 | $(2,732) | | Net Loss from Continuing Operations | $(2,625) | $(11,483) | | Net Loss of ZimVie Inc. | $(1,471) | $(7,761) | | Diluted EPS from Continuing Operations | $(0.09) | $(0.42) | Consolidated Balance Sheets As of March 31, 2025, ZimVie's total assets were $745.8 million, a slight decrease from $753.7 million at year-end 2024, while total liabilities decreased and total stockholders' equity increased Balance Sheet Highlights (in thousands) | Line Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $66,750 | $74,974 | | Total Current Assets | $250,658 | $257,285 | | Total Assets | $745,782 | $753,674 | | Total Current Liabilities | $117,144 | $133,944 | | Total Liabilities | $350,659 | $371,967 | | Total Stockholders' Equity | $395,123 | $381,707 | Consolidated Statements of Cash Flows The company used $13.9 million in cash from operating activities in Q1 2025, an increase from the $11.5 million used in Q1 2024, ending the period with $66.8 million in cash and cash equivalents Cash Flow Highlights (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(13,911) | $(11,511) | | Net cash used in investing activities | $(1,947) | $(4,138) | | Net cash used in financing activities | $(1,135) | $(1,437) | | Decrease in cash and cash equivalents | $(9,822) | $(19,184) | | Cash and cash equivalents, end of period | $66,750 | $68,584 | Reconciliation of Non-GAAP Financial Measures This section provides reconciliations of various non-GAAP financial measures, including constant currency net sales, adjusted net income, adjusted EBITDA, and adjusted operating expenses Reconciliation of Constant Currency Net Sales This section details the impact of foreign currency exchange rates on net sales, showing a 5.2% reported decrease but a smaller 4.1% decrease on a constant currency basis for Q1 2025 Q1 2025 Net Sales Change: Reported vs. Constant Currency | Region | Reported Change (%) | Foreign Exchange Impact | Constant Currency Change (%) | | :--- | :--- | :--- | :--- | | United States | (2.8%) | 0.0% | (2.8%) | | International | (8.5%) | (2.6%) | (5.9%) | | Total Net Sales | (5.2%) | (1.1%) | (4.1%) | Reconciliation of Adjusted Net Income and Diluted EPS ZimVie's reported GAAP net loss of $(2.6) million and EPS of $(0.09) were adjusted for various items, resulting in a non-GAAP adjusted net income of $7.4 million and an adjusted diluted EPS of $0.27 for Q1 2025 Reconciliation of Net Income (Loss) to Adjusted Net Income (in thousands) | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Reported Net (Loss) Income | $(2,625) | $(11,483) | | Intangible asset amortization | $6,032 | $6,022 | | Restructuring and other cost reduction initiatives | $1,432 | $2,579 | | Acquisition, integration, divestiture and related | $1,449 | $1,037 | | Other adjustments | $600 | $1,088 | | Tax effect of adjustments & other | $484 | $3,316 | | Adjusted Net Income | $7,371 | $2,158 | - Major adjustments for Q1 2025 include costs related to restructuring, professional services fees for the spine segment sale, and intangible asset amortization[29][30] Reconciliation of Adjusted EBITDA The company reconciles its Q1 2025 net loss of $(2.6) million to an adjusted EBITDA of $17.6 million, representing a significant increase from $12.5 million in Q1 2024 and an improved margin of 15.7% Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Description | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Loss | $(2,625) | $(11,483) | | Interest expense, net | $2,017 | $4,366 | | Income tax provision | $3,074 | $4,074 | | Depreciation and amortization | $8,655 | $8,430 | | EBITDA | $11,121 | $5,387 | | Share-based compensation | $3,497 | $2,762 | | Restructuring and other cost reduction initiatives | $1,432 | $2,579 | | Acquisition, integration, divestiture and related | $1,449 | $1,037 | | Other adjustments | $62 | $687 | | Adjusted EBITDA | $17,561 | $12,452 | Reconciliation of Cost of Products Sold, R&D and SG&A This section provides adjusted figures for key operating expense lines, with adjusted cost of products sold at 33.6% of net sales, adjusted R&D at 4.8%, and adjusted SG&A at 52.4% for Q1 2025 Adjusted Operating Expenses as a Percentage of Net Sales | Expense Line | Q1 2025 (Adjusted) | Q1 2024 (Adjusted) | | :--- | :--- | :--- | | Cost of products sold, excluding intangible asset amortization | 33.6% | 37.2% | | Research and development | 4.8% | 5.3% | | Selling, general and administrative | 52.4% | 51.0% | - Adjustments in Q1 2025 were made for regulatory costs related to the separation from ZBH and the net impact of converting performance-based RSUs to time-based RSUs[38][39] Supplementary Information This section provides an overview of ZimVie, details regarding the conference call, and important notes on non-GAAP financial measures and forward-looking statements About ZimVie and Conference Call This section provides a corporate overview of ZimVie as a global leader in the dental market, headquartered in Palm Beach Gardens, Florida, and announces the conference call scheduled for May 8, 2025 - ZimVie is a global life sciences leader in the dental market, offering a comprehensive portfolio for tooth replacement and restoration procedures[10] - A conference call to discuss Q1 2025 results was scheduled for May 8, 2025, at 4:30 p.m. ET[9] Note on Non-GAAP Financial Measures and Forward-Looking Statements The company explains its use of non-GAAP financial measures, stating they provide meaningful incremental information for investors, and includes a standard cautionary note regarding various risks and uncertainties affecting future results - The press release uses non-GAAP measures (e.g., constant currency, adjusted net income, adjusted EBITDA) which management believes help evaluate business performance and trends by allowing for period-to-period comparisons without the distortion of certain items[11][17] - The report contains forward-looking statements subject to significant risks and uncertainties, including dependence on new products, pricing pressures, regulatory changes, and general economic conditions, cautioning readers not to place undue reliance on them[20]