Apyx Medical(US:APYX)2023-05-11 14:21Financial Data and Key Metrics Changes - Total revenue for Q1 2023 decreased 3% year-over-year to $12.1 million, exceeding expectations by approximately $900,000 [6] - Advanced Energy sales decreased 10% year-over-year to $9.7 million, also exceeding expectations by approximately $700,000 [6] - OEM sales increased 46% year-over-year to $2.5 million, approximately $200,000 higher than anticipated [7] - Gross profit decreased 8% year-over-year to $7.6 million, with a gross profit margin of 62.4% compared to 65.8% in the prior year [26] - Net loss attributable to stockholders was $3.5 million or $0.10 per share, compared to $5.9 million or $0.17 per share for Q1 2022 [27] Business Line Data and Key Metrics Changes - Advanced Energy sales in the U.S. increased by nearly 10% year-over-year, with U.S. generator sales increasing by approximately 40% [8] - International generator sales decreased by more than 60% year-over-year, impacted by safety communication issues [9] - The Apyx One Console was launched in late January, contributing to stronger than anticipated sales performance [20] Market Data and Key Metrics Changes - The market opportunity for Renuvion technology in the U.S. cosmetic surgery market is estimated at nearly $3 billion, with an annual opportunity exceeding $700 million [36] Company Strategy and Development Direction - The company is focused on enhancing the Renuvion product portfolio and expanding clinical evidence supporting its products [37] - The recent FDA updates and 510(k) clearances are expected to drive growth and address previous safety communication issues [41][42] - The company aims to maximize growth opportunities through direct-to-consumer marketing and empowering international distribution partners [36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving revenue growth of at least 39% for the year, driven by recent regulatory clearances and the successful launch of the Apyx One Console [41] - The company anticipates stronger utilization trends as the year progresses, particularly in the U.S. market [49] Other Important Information - The company completed a sale and leaseback transaction for its Clearwater property, providing approximately $6.6 million in proceeds [24] - Cash and cash equivalents at the end of Q1 2023 were $16.3 million, compared to $10.2 million at the end of 2022 [28] Q&A Session Summary Question: Confidence in achieving full-year guidance - Management expressed confidence in achieving growth due to recent 510(k) clearances and the positive reception of the Apyx One Console [41] Question: Early conversations with clinicians regarding Renuvion usage - Management noted that existing customers were retained well, and the recent clearance for use after liposuction presents an opportunity to re-engage with clinicians [45] Question: Feedback from international distributors post-safety communication update - Management indicated that it was too early to assess feedback from international distributors following the recent update [49] Question: Visibility on generator sales pipeline - Management stated that they have forecasts and insights into the sales pipeline, with a focus on upgrading existing customers [51] Question: Impact of discounts on gross margins - Management clarified that the lower gross margins were primarily due to a higher proportion of OEM sales rather than the upgrade discounts [53]