Apyx Medical(US:APYX)2020-05-13 04:00Financial Data and Key Metrics Changes - Total revenue for Q1 2020 was $5 million, an 11% decline year over year, at the low end of the guidance range provided [6][7] - Net loss for Q1 2020 was $2 million or $0.06 per diluted share, significantly lower than the net loss of $5.6 million or $0.17 per diluted share in Q1 2019 [35][36] - Cash and cash equivalents as of March 31, 2020, were $51.4 million, down from $58.8 million as of December 31, 2019 [37] Business Line Data and Key Metrics Changes - U.S. sales declined 7% year over year to $3.6 million, while international sales declined 20% year over year to $1.4 million [9] - Advanced Energy business sales declined 9% year over year to $4 million, and OEM business sales declined 20% year over year to $1 million [9][10] - Advanced Energy sales in March declined nearly 50% year over year, with U.S. cosmetic surgery customer sales down nearly 30% year over year [13] Market Data and Key Metrics Changes - The COVID-19 pandemic caused significant disruptions, leading to a sharp decline in procedural trends, particularly in the U.S. and international markets [12][13] - The company experienced a 90% year-over-year decline in sales during April 2020, with a slight recovery noted in the second half of the month [42] Company Strategy and Development Direction - The company is focused on four strategic initiatives to drive long-term growth in the cosmetic surgery market, including pursuing new clinical indications for Renuvion technology [19][30] - Despite the pandemic, the company plans to continue investing in key areas that support future growth, such as clinical studies and manufacturing efficiencies [17][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the ongoing challenges posed by COVID-19 but expressed confidence in the company's ability to recover and return to strong growth [24][30] - The company is well-capitalized with over $51 million in cash, allowing it to fund operations for multiple years [25] Other Important Information - The company will not provide full-year 2020 financial guidance due to uncertainties related to the pandemic [37] - The company has implemented cost-reduction measures, including delaying discretionary spending and eliminating bonus accruals [17][36] Q&A Session Summary Question: Has there been heightened demand from Renuvion users as practices reopen? - Management noted that there has been a slight pickup in handpiece demand in late April, with overall sales down 90% year over year for the month [42] Question: How are lean initiatives impacting manufacturing? - Management confirmed that manufacturing efficiencies have improved product margins in the Advanced Energy segment, and they continue to focus on these initiatives [44][45] Question: How did virtual event attendance compare to in-person events? - Virtual events saw significantly higher attendance, with one recent event attracting 123 participants, much larger than typical in-person events [49] Question: How has COVID-19 impacted international device approvals? - Management indicated that there have been no significant issues with device registrations in other countries, and they remain confident in meeting proposed timelines [51] Question: What percentage of customer offices are currently open? - Management stated that it is difficult to quantify the percentage of open offices due to varying state restrictions, but they are encouraged by the lifting of restrictions [54][55] Question: What is the timeline for resuming clinical trials? - Management could not provide a specific timeline for resuming clinical trials, as it depends on clinicians reopening their practices [58]