Orthofix(US:OFIX)2022-05-06 11:58Financial Performance - Net sales for the three months ended March 31, 2022, were $106,418 thousand, a slight increase from $105,593 thousand in the same period of 2021, representing a growth of approximately 0.8%[16] - Gross profit for the same period was $78,100 thousand, down from $79,679 thousand in 2021, indicating a decrease of about 2%[16] - The operating loss for Q1 2022 was $3,078 thousand, compared to a loss of $2,916 thousand in Q1 2021, reflecting a deterioration of approximately 5.5%[16] - The net loss for the three months ended March 31, 2022, was $4,460 thousand, an improvement from a net loss of $5,816 thousand in the prior year, showing a reduction of about 23.3%[16] - The Company reported a comprehensive loss of $5,622 thousand for Q1 2022, compared to a comprehensive loss of $7,389 thousand in the same period of 2021, indicating an improvement of approximately 23.9%[16] - Total EBITDA for the three months ended March 31, 2022, was $3,502,000, compared to $1,837,000 in 2021[47] - The Company reported a loss before income taxes of $4,389,000 for the three months ended March 31, 2022, compared to a loss of $6,023,000 in 2021[47] Cash and Liquidity - Cash, cash equivalents, and restricted cash at the end of the period were $71,917 thousand, down from $95,057 thousand at the end of Q1 2021, representing a decrease of approximately 24.4%[18] - The company anticipates that its cash and cash equivalents, investments, and access to revolving credit will be sufficient to meet its anticipated cash requirements[14] - The Company had no borrowings outstanding under the secured revolving credit facility as of March 31, 2022, and was in compliance with all required financial covenants[25] Inventory and Assets - Total inventories as of March 31, 2022, were $88,832 thousand, an increase from $82,974 thousand at the end of 2021, indicating a rise of about 7%[23] - As of March 31, 2022, the total Right-of-Use (ROU) assets increased to $25,213,000 from $21,755,000 as of December 31, 2021, representing a growth of approximately 15.5%[24] - The total lease liabilities rose to $27,543,000 as of March 31, 2022, compared to $25,757,000 at the end of 2021, indicating an increase of about 6.9%[24] Research and Development - Research and development expenses for Q1 2022 were $11,212 thousand, compared to $10,897 thousand in Q1 2021, reflecting an increase of approximately 2.9%[16] Shareholder Information - The weighted average number of common shares outstanding increased to 19,841,822 in Q1 2022 from 19,474,384 in Q1 2021, representing an increase of about 1.9%[17] - Weighted average common shares for diluted EPS calculations were 19,897,695 for the three months ended March 31, 2022, compared to 19,526,872 in 2021[54] - Share-based compensation expense totaled $4,332,000 for the three months ended March 31, 2022, compared to $3,721,000 in 2021[50] Segment Performance - Global Spine segment net sales were $82,655,000, with Bone Growth Therapies decreasing by 2.3% to $41,948,000, while Spinal Implants increased by 3.6% to $26,615,000[41] - Global Orthopedics segment net sales were $23,763,000, reflecting a 2.2% increase from $23,253,000 in 2021[41] Other Financial Metrics - The allowance for expected credit losses increased to $5,389,000 as of March 31, 2022, from $4,506,000 in 2021[43] - The effective tax rate for the three months ended March 31, 2022, was (1.6%), down from 3.4% in 2021, primarily due to certain losses not benefitted[52] - The Company recognized a contract liability ending balance of $1,396,000 for the Accelerated and Advanced Payment Program, down from $13,851,000 in 2021[44] - The Company accrued $5,400,000 related to the Italian Medical Device Payback (IMDP) as of March 31, 2022, which is classified within other long-term liabilities[39] - The Company recorded cash paid for operating leases of $1,068,000 for the three months ended March 31, 2022, compared to $1,147,000 for the same period in 2021[24] - The Company recorded an expense of $300,000 and $400,000 for the IMDP for the three months ended March 31, 2022, and 2021, respectively[39] Fair Value Measurements - The fair value of Neo Medical preferred equity securities increased to $6,084,000 as of March 31, 2022, up from $5,413,000 at the end of 2021, reflecting a growth of approximately 12.3%[26] - The fair value of Neo Medical Convertible Loans decreased to $5,780,000 as of March 31, 2022, down from $7,148,000 at the beginning of the year, a decline of about 19.2%[31] - The estimated fair value of the Spinal Kinetics contingent consideration was $11,700,000 as of March 31, 2022, down from $17,200,000 at the start of the year, a decrease of approximately 32.5%[36] - The Company recognized a cumulative unrealized gain of $413,000 on Neo Medical preferred equity securities as of March 31, 2022[29]