Anika Therapeutics(US:ANIK)2022-05-07 10:36Financial Data and Key Metrics Changes - Total revenue for Q1 2022 was $36.7 million, an increase of 7% compared to the prior year [21] - Gross margin was 59%, with an adjusted gross margin of 64% after excluding noncash acquisition-related expenses [22] - Net loss for the quarter was $2.9 million, or $0.20 per share, compared to net income of $2.8 million, or $0.20 per diluted share in Q1 2021 [23] - Adjusted EBITDA was $2.6 million, down from $4.8 million in the same quarter last year [24] Business Line Data and Key Metrics Changes - OA pain management revenue increased by 18% to $22.7 million, driven by favorable order timing [21] - Joint preservation and restoration revenue decreased by 1% from $12.2 million to $12.1 million, showing some recovery after early quarter COVID headwinds [22] - Nonorthopedic revenue was $1.8 million, down 34% from the previous year due to higher revenues from last time buys of legacy products [22] Market Data and Key Metrics Changes - The company noted that the macroeconomic effects of staffing shortages and supply chain issues could remain as headwinds for the industry [10] - The healthcare environment appears to be improving, which is expected to positively impact market conditions [42] Company Strategy and Development Direction - The company is focused on becoming a leading provider of early intervention and joint preservation solutions, with several new product launches planned in the shoulder and foot and ankle spaces within the next six to 24 months [14][20] - The addition of Rob Delp as Vice President of U.S. Sales is expected to enhance commercial strategy execution [13] - The company aims for mid-teens revenue growth and an adjusted gross margin of 70% over the long term, despite being behind its original five-year target due to COVID impacts [28] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for market improvement through the year as COVID-related impacts abate [10] - The company reiterated its full-year 2022 total revenue outlook of low to mid-single-digit percentage growth over 2021, with expectations for joint preservation and restoration to be the fastest-growing product family [25][26] - Adjusted EBITDA margin is expected to be in the low to mid-single digits due to targeted spending investments and ongoing supply chain challenges [28] Other Important Information - The company has ramped up medical education efforts, training over 140 surgeons to date [11] - The company is investing in commercial capabilities and product development to support growth objectives [27] Q&A Session Summary Question: Inquiry about OA pain management growth assumptions - Management indicated that the OA pain management market is expected to grow at about 1%, with the company aiming to grow ahead of the market [33] Question: Update on CINGAL pilot trial timeline - Management confirmed that data readout for the CINGAL pilot trial is expected in the fall, with updates to be provided at that time [36] Question: Clarification on OA pain management business strength - Management noted that the strong performance was due to favorable timing in international markets and veterinary products, but they did not change their full-year guidance [38] Question: Joint preservation revenue decline and future expectations - Management acknowledged a tough January due to Omicron but expects recovery and growth catalysts to drive improvement in the coming quarters [41]