Workflow
TELA Bio(TELA) - 2024 Q3 - Earnings Call Transcript
TELATELA Bio(TELA)2024-11-09 18:49
Filings

Financial Data and Key Metrics Changes - Revenue for Q3 2024 was 19million,representinga2619 million, representing a 26% year-over-year increase [7][18] - Gross margin was 68% for Q3 2024, down from 69% in the prior year, primarily due to higher charges for excess and obsolete inventory [18] - Net loss for Q3 2024 was 10.4 million, compared to 11millioninthesameperiodin2023[20]BusinessLineDataandKeyMetricsChanges−UnitsalesforOviTexgrewby3911 million in the same period in 2023 [20] Business Line Data and Key Metrics Changes - Unit sales for OviTex grew by 39%, while OviTex PRS saw a 44% increase [8] - Revenue from OviTex grew by 23%, and OviTex PRS grew by 31% [18] - Sales in the plastic and reconstruction portfolio topped 6.3 million in Q3 2024 [12] Market Data and Key Metrics Changes - The European business grew by 67% compared to the prior year [8] - The company achieved its first 1millionmonthinEuropeduringQ3[10]−Therearenowover700hospitalsworldwideusingthecompany′sproducts[8]CompanyStrategyandDevelopmentDirection−Thecompanyisfocusingonagrowthstrategybasedondata−drivensellingacrossitsentireportfolio[15]−AshiftfromsyntheticmeshtomorenaturalrepairproductslikeOviTexisgainingrecognitionforitssafetyprofileandclinicalbenefits[11]−Thecompanyisimplementingchangestoreduceoperatingexpensesby1 million month in Europe during Q3 [10] - There are now over 700 hospitals worldwide using the company's products [8] Company Strategy and Development Direction - The company is focusing on a growth strategy based on data-driven selling across its entire portfolio [15] - A shift from synthetic mesh to more natural repair products like OviTex is gaining recognition for its safety profile and clinical benefits [11] - The company is implementing changes to reduce operating expenses by 5 million to 10millionannually,withsomesavingsexpectedinQ42024[17]Management′sCommentsonOperatingEnvironmentandFutureOutlook−Managementexpressedconfidenceinthecompany′sprospects,emphasizingthepotentialforOviTexandOviTexPRStobecomeleadingtechnologiesinsofttissuepreservationandrestoration[25]−Thecompanyremainsontracktoachievefull−yearrevenueguidanceof10 million annually, with some savings expected in Q4 2024 [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's prospects, emphasizing the potential for OviTex and OviTex PRS to become leading technologies in soft tissue preservation and restoration [25] - The company remains on track to achieve full-year revenue guidance of 74.5 million to 76.5million,reflectinggrowthof2876.5 million, reflecting growth of 28% to 31% over 2023 [22] - Management is monitoring elective procedure volumes for potential disruptions due to IV fluid shortages from recent natural disasters [22] Other Important Information - The company closed a public offering that added 43 million to its balance sheet, providing ample funding for continued growth [9] - The company is committed to perpetual training for its sales force to maintain a competitive advantage in a dynamic market [44] Q&A Session Summary Question: Can you provide more color on the 5millionto5 million to 10 million in OpEx savings? - The savings primarily come from headcount reductions and a shift in the sales force structure, allowing for a more efficient organization [28][29] Question: Did you recover procedures from the cyberattack challenges in Q2? - Management indicated that there was no significant backlog from Q2, and procedures returned to normal levels without a discernible load-up [30][32] Question: Any initial thoughts on growth as we enter 2025? - While no guidance for 2025 was provided, management noted that growth rates may throttle back as the company matures [35] Question: What trends are being seen in the fourth quarter? - October was a record high for the first month of the quarter, suggesting the company is on track to meet its guidance [41] Question: Can you elaborate on the balanced selling and sales rep training? - The company is committed to continuous training for its sales force to adapt to market changes and maintain productivity [44]