Bioventus Inc. · NASDAQ:BVS
Bioventus — Q4 2022 Earnings Presentation
22 slides from Bioventus's earnings presentation, Mar 31, 2023
Slide 1: Fourth Quarter 2022 Financial Results
Fourth Quarter 2022 Financial Results March 31, 2023
Slide 2: Agenda and Speakers
Agenda and Speakers Ken Reali Mark Singleton Chief Executive Officer Senior Vice-President and Chief Financial Officer Update on Financial Position Q4 2022 Results Review of Q4 Results
Slide 3: Forward Looking Statements and Use of Estimates
Forward Looking Statements and Use of Estimates Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements contained i
Slide 4: Enhanced Financial Position
Enhanced Financial Position • Announced in February an agreement with CartiHeal’s shareholders to eliminate $350 million of obligations and sales milestone payments • Explored ability to fund $215 million of deferred purchase obligations to retain CartiHeal • Unable to secure terms that met our crit
Slide 5: Actions to Enhance Earnings and Improve Balance Sheet
Actions to Enhance Earnings and Improve Balance Sheet • Restructuring business to reduce costs and anticipate generating $9 million to $10 million in annual savings • Prioritizing investment and aggressively managing spending for near- term growth by curtailing spending in other areas • Evaluating d
Slide 6: Fourth Quarter Results: Revenue Decreased 4% to $126M
Fourth Quarter Results: Revenue Decreased 4% to $126M • Financial results below our expectations as we experienced continued pressure across our HA franchise • Revenue shortfall in HA attributed to: • Unanticipated rebate claims from one private payer of $4 million • Reduced selling price from highe
Slide 7: Fourth Quarter Results: Revenue Decreased 4% to $126M
Fourth Quarter Results: Revenue Decreased 4% to $126M • Gelsyn saw continued reduction in volume • Volume shifted in more price-sensitive or non-contracted accounts • Greater percentage of volume now in contracted accounts, further increasing pressure on its ASP • Durolane revenue declined high sing
Slide 8: Fourth Quarter Results: Revenue Decreased 4% to $126M
Fourth Quarter Results: Revenue Decreased 4% to $126M • Surgical Solutions delivered continued strong double-digit organic1 growth • OsteoAmp Flowable continues to grow rapidly • Launched BoneScalpel Access • Double-digit ultrasonics growth in the U.S. • Forecast double-digit growth in 2023 • Restor
Slide 9: Improving Execution, Internal Processes and Operational Efficiencies
Improving Execution, Internal Processes and Operational Efficiencies • Focus on accelerating our margin profile, rebuilding our balance sheet and regaining investor confidence • Delivering on annual operating plan of EBITDA growth and operating margin acceleration • Completing integration of Misonix
Slide 10: Fourth Quarter Results, CartiHeal Financing, 2022 Guidance Update
Fourth Quarter Results CartiHeal Financing 2022 Guidance Update Mark Singleton Senior Vice-President and Chief Financial Officer 10
Slide 11: Fourth Quarter Performance
Fourth Quarter Performance • Revenue of $126 million decreased 4% compared to the prior year quarter • 10 percentage point decrease in organic1 revenue • 6 percentage point benefit related to Misonix • Lower sales and gross margin performance headwinds impacted adjusted EBITDA2 of $15 million and ad
Slide 12: Fourth Quarter Performance
Fourth Quarter Performance Pain Treatments Revenue Surgical Solutions Revenue Restorative Therapies Revenue Millions Millions Millions $63 $37 $38 $39 $48 $31 Q4 2021 Q4 2022 Q4 2021 Q4 2022 Q4 2021 Q4 2022 • Pain Treatments declined 23% • Surgical Solutions grew 27% • Restorative Therapies grew 4%
Slide 13: Fourth Quarter Performance
Fourth Quarter Performance Adjusted Gross Profit Millions Adjusted Gross Margin • Adjusted gross margin* decreased 510 basis points $100 $90 • Unexpected rebate claims and decreased ASP across Durolane and 76.3% 71.2% Gelsyn from higher rebates • Unfavorable product mix Q4 2021 Q4 2022 • Adjusted op
Slide 14: Fourth Quarter Performance
Fourth Quarter Performance -$0.06 Adjusted Earnings Per Share* Adjusted EBITDA* Adjusted Operating Income* Adjusted Net Income* Millions Millions Millions $28 $22 $18 $15 $12 Q4 2022 Q4 2021 Q4 2022 Q4 2021 Q4 2022 Q4 2021 Q4 2022 $(9) * For a reconciliation of reported GAAP measures to non-GAAP mea
Slide 15: Fourth Quarter Performance: Balance Sheet and Cash Flow
Fourth Quarter Performance: Balance Sheet and Cash Flow • Ended quarter with $32 million of cash • $418 million of debt outstanding • Operating cash outflow of $5 million due to improvement in working capital 15
Slide 16: Debt Agreement Amendment
Debt Agreement Amendment • Amended debt agreement to provide additional headroom in covenants beginning in fourth quarter 2022 through first quarter of 2024 • Amendment increase spread on term loan by 100 bps • Revised cost of term loan is SOFR plus 425 basis points • Going concern qualification rem
Slide 17: 2023 Guidance
2023 Guidance • Delaying establishing 2023 guidance due to of potential divestiture and uncertainty around rebates related to HA business • First quarter expectations: • Revenue growth of low-single digits compared to the prior year • Strong growth across Surgical Solutions and Restorative Therapies
Slide 18: Bioventus: Innovations For Active Healing
@ bioventus Innovations For Active Healing
Slide 19: Reconciliation of Net (Loss) Income to Adjusted EBITDA (unaudited)
Reconciliation of Net (Loss) Income to Adjusted EBITDA (unaudited) a) Includes for the three months ended December 31, 2022 and December 31, 2021 and the years ended December 31, 2022 and December 31, 2021, respectively, depreciation and amortization of $15,389, $8,980, $45,622 and $26,471 in cost o
Slide 20: Reconciliation of Other Reported GAAP Measures to Non-GAAP Measures (Three Months)
Reconciliation of Other Reported GAAP Measures to Non- GAAP Measures (for Three Months Ended) a) The "Reported GAAP Measure" under the "Operating Expenses" column is a sum of all GAAP operating expense line items, excluding research and development. b) Consists of acquisition related items such as i
Slide 21: Reconciliation of Other Reported GAAP Measures to Non-GAAP Measures (Year Ended)
Reconciliation of Other Reported GAAP Measures to Non- GAAP Measures (for Year Ended) a) The "Reported GAAP Measure" under the "Operating Expenses" column is a sum of all GAAP operating expense line items, excluding research and development. b) Consists of acquisition related items such as integrati
Slide 22: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Organic Revenue Growth The Company defines the term “organic revenue” as revenue in the stated period excluding the impact from business acquisitions and divestitures. The Company uses the related term “organic revenue growth” to refer to the financial performance