Financial

SeaSpine Reports First Quarter 2019 Financial Results

CARLSBAD, Calif., May 01, 2019 (GLOBE NEWSWIRE) — SeaSpine Holdings Corporation (NASDAQ: SPNE), a global medical technology company focused on surgical solutions for the treatment of spinal disorders, announced today financial results for the quarter ended March 31, 2019 and updated its financial outlook for 2019.

Summary First Quarter 2019 Financial Results

  • Revenue of $36.2 million, an increase of 9% year-over-year
  • U.S. revenue of $32.0 million, an increase of 8% year-over-year
    • U.S. spinal implants revenue of $14.9 million, a 9% increase year-over-year
    • U.S. orthobiologics revenue of $17.0 million, an 8% increase year-over-year          
  • International revenue of $4.2 million, a 15% increase year-over-year

“We were pleased with our performance and execution in the first quarter,” said Keith Valentine, President and Chief Executive Officer. “We remain steadfast in delivering on our vision to develop surgeon-centric, cost effective solutions that combine innovative spinal implant systems with industry leading orthobiologics. I’m excited by the opportunity we have ahead to significantly expand our market share with our robust pipeline of new and next-generation products, coupled with the potential of our more exclusive and committed distribution partners.”

First Quarter 2019 Financial Results

Total revenue for the first quarter of 2019 was $36.2 million, a 9% increase compared to the same period of the prior year. Total U.S. revenue was $32.0 million, an 8% increase compared to the same period of the prior year.  The increase in U.S. revenue was driven by both the spinal implants and orthobiologics portfolios.  International revenue was $4.2 million, a 15% increase compared to the same period of the prior year.  The increase in international revenue was driven primarily by spinal implants growth in Europe.

Orthobiologics revenue totaled $19.0 million, a 6% increase compared to the first quarter of 2018.  The increase in orthobiologics revenue was driven primarily by growth in recently launched products, led by the OsteoStrand™ Plus product.

Spinal implants revenue totaled $17.1 million, a 13% increase compared to the first quarter of 2018.  The increase in spinal implants revenue was driven by growth in recently launched products, led primarily by the Shoreline and Mariner systems and by the Company’s expanded NanoMetalene portfolio.

Gross margin for the first quarter of 2019 was 62.4% and reflects the benefits of the Company’s focused efforts to reduce manufacturing costs of its orthobiologics products.  In 2018, the Company implemented a series of process improvements at its Irvine, California manufacturing facility that increased manufacturing yields and lowered manufacturing scrap rates.

Operating expenses for the first quarter of 2019 totaled $31.6 million, compared to $28.0 million for the same period of the prior year. The $3.6 million increase in operating expenses was primarily the result of $2.8 million in higher selling, general and administrative expenses, including stock-based compensation related to the timing of equity award grants, selling commissions, and salaries and wages.  Research and development costs increased approximately $0.7 million primarily due to increased headcount and higher costs related to clinical studies.

Net loss for the first quarter of 2019 was $9.0 million, compared to a net loss of $7.1 million for the same period of the prior year.

Cash, cash equivalents and investments at March 31, 2019 totaled $45.0 million and the Company had no amounts outstanding under its credit facility.

Updated 2019 Financial Outlook
SeaSpine expects full-year 2019 revenue to be in the range of $154 million to $156 million, reflecting growth of approximately 7.5% to 9.0% over full-year 2018 revenue. This compares to previous revenue guidance of $152 million to $156 million.

Webcast and Conference Call Information
The Company’s management team will host a conference call beginning today at 1:30pm PT/4:30pm ET to discuss the financial results and recent business developments. Individuals interested in listening to the conference call may do so by dialing (877) 418-4766 for domestic callers or (614) 385-1253 for international callers, using Conference ID: 4492577.  To listen to a live webcast, please visit the Investors section of the SeaSpine website at: www.seaspine.com.

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Drue De Angelis

Drue is Managing Partner for The De Angelis Group, Executive Search firm exclusively for the Ortho & Spine industry.

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