Sanara MedTech(US:SMTI)2024-11-13 19:47Financial Data and Key Metrics Changes - The company generated $21.7 million in net revenue during Q3 2024, a 35% increase year-over-year, marking the 12th consecutive record revenue quarter [5][20] - Adjusted EBITDA improved to $800,000 in Q3 2024, compared to $300,000 in Q3 2023 [6] - Gross profit for Q3 2024 was $19.7 million, up $5.4 million or 38% from the prior year [21] - The company reported a net loss of $2.9 million for Q3 2024, compared to a net loss of $1.1 million in Q3 2023 [23] Business Line Data and Key Metrics Changes - The Surgical segment reported a net loss of $200,000 in Q3 2024, with a year-to-date loss of $2.9 million [7] - Surgical segment generated $2.6 million in segmented EBITDA for Q3 2024 and $5.1 million year-to-date [25] - Sales of soft tissue products increased from $13.6 million in Q3 2023 to $18.9 million in Q3 2024, while bone fusion products grew from $2.3 million to $2.8 million in the same period [13] Market Data and Key Metrics Changes - Products were sold in over 1,200 hospitals across 34 states and the District of Columbia, with contracts or approvals in more than 4,000 facilities [12] - The company has selling agreements with over 300 distributors, representing more than 2,900 potential sellers [12] Company Strategy and Development Direction - The company is focused on disrupting the $100 billion-plus non-acute wound care market through its Tissue Health Plus (THP) strategy [16] - Plans to invest in THP technology platform and related infrastructure through an expected commercial launch in mid-2025 [8] - The company is pursuing financial partners that align with its strategy, including a recent $5 million investment in ChemoMouthpiece LLC [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth and improvement in operating results, particularly in the Surgical segment [27] - The company anticipates a significant opportunity in the non-acute wound care market with the THP strategy and expects a commercial launch in mid-2025 [27] Other Important Information - The company reported a cash balance of $16.3 million at the end of the quarter [26] - R&D expenses for Q3 2024 were $1.4 million, up from $1 million in Q3 2023, with a portion allocated to the THP segment [22] Q&A Session Summary Question: Rationale for the investment in ChemoMouthpiece - The investment aligns with the company's wound and skin care strategy, addressing oral mucositis caused by chemotherapy [29][30] Question: Feedback on the pilot program with the podiatry group - The pilot program is on target, with early previews receiving positive feedback [34] Question: Operational personnel recruitment for THP - The company successfully attracted skilled personnel with execution experience, enhancing platform development efforts [35] Question: Outlook on OpEx for the remainder of the year and 2025 - The company has a clear budget and expects continued growth in adjusted EBITDA without surprises [37] Question: Update on work with Tufts regarding the 18 peptides - The technical team is progressing on solutions for radiation dermatitis, complementing the strategy with InfuSystem [39] Question: Types of partners sought for THP - The company is looking for financial and execution partners, focusing on those with experience in the provider community and supply chain [41][42] Question: Profitability expectations for THP upon launch - A ramp-up will be needed to achieve profitability in the THP segment [44] Question: Update on IP progress with Cellerate and BIASURGE - The company is making good progress on IP and is scaling BIASURGE product sales [45][46] Question: Market makers and share price concerns - Management is focused on growth and adjusted EBITDA progression, with plans to avoid highly dilutive events [52][54]