STRATA Skin Sciences(SSKN) - 2021 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - STRATA reported Q4 2021 revenues of $9.1 million, a 35% increase compared to Q4 2020 and a 17% increase over Q3 2021 [11][36] - Full year 2021 revenues reached $30 million, a 30% increase over 2020 [45] - Recurring revenues for Q4 2021 were $6.7 million, a 32% increase year-over-year and a 17% increase sequentially [37] - The net loss for Q4 2021 was $849,000, compared to a loss of $443,000 in Q4 2020 [44] Business Line Data and Key Metrics Changes - Equipment revenues for Q4 2021 were $2.4 million, a 45% increase compared to Q4 2020 [38] - The number of recurring revenue XTRAC devices in the U.S. increased to 890, up from 832 at the end of 2020 [13] - High-volume customers contributed over $3 million in revenues, accounting for 54% of all revenues in Q4 [28] Market Data and Key Metrics Changes - International revenue for the full year grew 28% over 2020, highlighting strong traction through distribution partners [24] - STRATA expanded into Israel, targeting an additional 300,000 psoriasis and 160,000 vitiligo patients [25] Company Strategy and Development Direction - STRATA aims to expand into the $5.5 billion acne treatment market through the acquisition of the Theraclear acne system [18] - The company plans to launch Theraclear in Q3 2022, focusing on leveraging existing relationships with XTRAC partners [22][54] - STRATA is also focusing on enhancing its direct-to-dermatology marketing initiatives to drive XTRAC usage [32] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges from the Omicron variant impacting early 2022 revenues but projected a strong year-over-year growth of 18% to 20% for Q1 2022 [15][50] - The company expects full year 2022 revenues to be between $33 million and $35 million, indicating continued growth despite headwinds [50] Other Important Information - STRATA's gross profit for Q4 2021 was $6 million, or 66% of revenues, with expectations for margins to remain stable in the 65% to 70% range [41][43] - The company has made significant improvements in reducing non-revenue-generating devices, ending 2021 with 15% of its installed base non-generating revenue [30] Q&A Session Summary Question: How is STRATA anticipating the rollout of Theraclear in 2022? - Management expects to roll out Theraclear around mid-year, targeting existing XTRAC partners for initial placements [54] Question: Can you provide details on the Momentum 1.0 conversions? - The focus will be on high-volume customers, with plans to refurbish and redeploy older units [58] Question: What is the expected mix of revenue sources for FY 2022? - Management indicated that recurring revenue from existing XTRAC partners and conversions from Ra will be key, with Theraclear contributing in the second half of the year [72] Question: How does geographic revenue concentration look? - The majority of revenue is generated from the East and West Coasts, with a significant presence in the Upper Midwest [78]