TELA Bio(US:TELA)2024-05-11 18:35Financial Data and Key Metrics Changes - Revenue for Q1 2024 grew 39% year-over-year to $16.6 million, marking the 13th consecutive quarter of growth of 35% or greater [7][94] - Gross margin increased to 68% from 66% in the prior year, primarily due to improved inventory management [82] - Operating loss decreased to $4.8 million from $11.3 million in the prior year, with net loss reduced to $5.7 million from $12 million [70] Business Line Data and Key Metrics Changes - OviTex revenue grew 31%, while OviTex PRS saw a 54% increase in the same period, driven by higher unit sales and expansion of the commercial organization [7][96] - PRS now accounts for over a third of total sales, with the long-term resorbable configuration making up 55% of the PRS portfolio [96] Market Data and Key Metrics Changes - The company engaged with surgeons at 25 industry meetings through March 2024, enhancing its presence in the market [20] - Over 50,000 units of OviTex have been used in hernia and complex abdominal wall procedures, indicating strong market penetration [96] Company Strategy and Development Direction - The company aims to capitalize on the momentum generated in Q4 2023, focusing on product launches and enhancements to the commercial team [4] - TELA Bio is positioned to compete effectively with larger competitors, leveraging a complete product portfolio and strong clinical data [67][100] Management's Comments on Operating Environment and Future Outlook - Management expects operating loss and net loss to decrease in 2024 compared to 2023, with steady operating expenses and sequential revenue growth [8] - The company is optimistic about the potential of LIQUIFIX and IHR products to open new market opportunities [9][12] Other Important Information - The company ended Q1 2024 with $37.1 million in cash and cash equivalents, indicating a strong financial position [70] - A strategic hire was made with Dr. Howard Langstein joining as Vice President of Medical Affairs to drive awareness of TELA's products [62] Q&A Session Summary Question: How do you feel about cash burn this quarter and how you expect that to trend throughout the year? - Management expressed confidence in cash burn management, anticipating steady operational expenses and revenue growth to improve profitability metrics [48] Question: Can you provide an update on your GPO contracts and how you're ramping there? - The company is actively pursuing access via IDNs and smaller GPOs, with positive dynamics expected for future contracts [107][119] Question: What are the sequential expectations for Q2? - Management noted that Q2 is typically a strong quarter and expressed optimism about growth driven by a fully staffed sales organization and new product introductions [44] Question: How is productivity trending, including initiatives for balanced selling? - New reps are averaging just under six months to reach breakeven, with a balanced selling approach showing early signs of success [47][29] Question: What is the contribution expected from IHR for this year? - IHR is anticipated to have a quick uptake among surgeons already using TELA's products, contributing positively to revenue [105] Question: Can you elaborate on the impact of the synthetic mesh lawsuit? - Management is monitoring the situation closely and has a communication plan in place to address potential outcomes [71][86]