Alphatec (US:ATEC)2021-05-08 14:15Financial Data and Key Metrics Changes - In Q1 2021, U.S. revenue reached $43.7 million, reflecting a 50% growth year-over-year, while total revenue was $44.1 million, up 47% compared to the prior year [21][22] - Non-GAAP U.S. gross margin was 77.9%, consistent with the prior year, while operating expenses increased to $42 million, approximately 95% of sales, reflecting investments in growth [22][24] - Cash usage was approximately $34 million in Q1, primarily driven by capital expenditures, which accounted for over 62% of cash burn [25] Business Line Data and Key Metrics Changes - The company reported a 50% year-over-year growth in revenue, with 77% of revenue coming from new product contributions [4][20] - Average revenue per surgeon grew by 17% year-over-year, and average revenue per case increased by 13% [4][14] - The average products sold per surgery slightly increased to above 1.9 categories [13] Market Data and Key Metrics Changes - The company noted a slight dip in surgical volumes early in Q1, but March showed a breakout month, indicating a potential backlog of procedures [32][33] - The company is focused on expanding its geographical presence, with significant opportunities in major metro areas where it currently lacks representation [46][19] Company Strategy and Development Direction - The company aims to revolutionize spine surgery through the launch of new products like PTP and InVictus, emphasizing clinical distinction and surgeon adoption [4][10] - The strategy includes revitalizing the sales force and expanding the distribution network to enhance market coverage [18][19] - The company is committed to organic innovation and developing a comprehensive product portfolio to address various surgical needs [12][15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's growth trajectory, citing a strong start to 2021 and an increase in full-year revenue guidance to approximately $188 million, implying a 33% year-over-year growth [26][27] - The management highlighted the importance of clinical outcomes and predictive analytics in driving future growth and improving surgical procedures [16][60] - The company is focused on integrating EOS technology to enhance preoperative planning and improve surgical outcomes [60][75] Other Important Information - The company secured approximately $132 million through PIPE funding, ending the quarter with over $190 million in cash, with plans to invest in growth initiatives [24] - The EOS transaction is progressing as planned, with expectations to close during the current quarter [25][26] Q&A Session Summary Question: What is the current marketplace activity and backlog of procedures? - Management noted softness in January and February, with March showing improvement and a potential backlog of procedures to capture [32][33] Question: What is the status of PTP and its adoption? - Management indicated that PTP is in the early phases of adoption, with surgeons starting with simpler procedures and gradually moving to more complex surgeries [40][41] Question: Can you elaborate on the distribution channel and exclusivity? - Management emphasized the need for strong clinical acumen in the distribution network and highlighted significant geographical gaps that need to be filled [46][19] Question: What is the value proposition for EOS? - Management stated that EOS offers immediate value with its new imaging technology, which significantly improves surgical decision-making [75][76]