Slide 1: Real patients treated with VNS Therapy
Real patients treated with VNS Therapy (Left to Right: Breanna; Candace; Jose, father of patient David) 1
Slide 2: Safe Harbor
Safe Harbor Certain statements in this material, other than statements of historical or current fact, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act and Section 21E of the Exchange Act. These statements i
Slide 3: Intellectual Property
Intellectual Property This report may contain references to LivaNova's proprietary intellectual property, including among others: • Trademarks for LivaNova's Neuromodulation systems, the VNS Therapy™ System, the VITARIA™ System and LivaNova's proprietary pulse generator products: Model 102 (Pulse™),
Slide 4: Contents
Contents 4Q and Full-Year 2023 Financial Results 2024 Guidance and Assumptions Closing Thoughts Appendix 4
Slide 5: Financial Results
Financial Results Financial Results 5
Slide 6: 4Q23 Financial Summary
4Q23 Financial Summary 4Q22 4Q23 Net Revenue ($M) Adjusted Diluted EPS et Sales ($ in MM) Adjusted Diluted EPS $310.1 • Net revenue increased 11.9 percent on a constant-currency basis $274.9 • Foreign currency had a favorable impact on net revenue of ~$3M, or 1 $0.87 $0.81 percent • Adjusted gross p
Slide 7: 2023 Financial Summary
2023 Financial Summary 2022 2023 Net Revenue ($M) Adjusted Diluted EPS $1,153.5 $1,021.8 Adjusted Diluted EPS • Net revenue increased 13.3 percent on a constant-currency basis $2.80 $2.39 • Foreign currency had an unfavorable impact on net revenue of ~$4M, or less than 1 percent • Adjusted gross pro
Slide 8: 4Q23 Net Revenue
4Q23 Net Revenue Cardiopulmonary (CP) Neuromodulation • Heart-lung machines (HLM) • Oxygenators Vagus Nerve Stimulation Therapy • Autotransfusion systems (ATS) (VNS Therapy) • Cannulae • Drug-Resistant Epilepsy (DRE) • Difficult-to-Treat Depression (DTD) 44% $310.1M Hypoglossal Nerve Stimulation The
Slide 9: 2023 Net Revenue
2023 Net Revenue Cardiopulmonary (CP) Neuromodulation • Heart-lung machines (HLM) • Oxygenators Vagus Nerve Stimulation Therapy • Autotransfusion systems (ATS) (VNS Therapy) • Cannulae • Drug-Resistant Epilepsy (DRE) • Difficult-to-Treat Depression (DTD) 45% $1.15B 51% Hypoglossal Nerve Stimulation
Slide 10: Segment Net Revenue Comparisons by Region
Segment Net Revenue Comparisons by Region Three Months Ended December 31, Year Ended December 31, Constant- Constant- Currency % Currency % ($M) 2023 2022 % Change Change(1) 2023 2022 % Change Change(1) Cardiopulmonary United States $56.9 $45.1 26.4% 26.4% $188.3 $159.5 18.1% 18.1% Europe(2) 46.0 33
Slide 11: 4Q23 Cardiopulmonary Revenue
4Q23 Cardiopulmonary Revenue(1) Drivers/Impacts Net Revenue ($M) 17.0% $161.5 Revenue increased 17.0% with strength in the Europe and U.S. regions. $136.5 $58.6 $58.3 Oxygenator revenue grew mid-single-digits. $46.0 $33.1 HLM revenue grew more than 40% primarily driven by Essenz $56.9 sales in the E
Slide 12: 4Q23 Neuromodulation Revenue
4Q23 Neuromodulation Revenue(1) Drivers/Impacts Net Revenue ($M) 7.1% $136.9 Revenue increased 7.1% with growth in the Europe and U.S. $127.1 $14.1 regions. $14.7 $16.4 $13.0 Total Epilepsy revenue increased 7.7% with U.S. Epilepsy revenue growth of 8.0% driven by new and replacement implants. $99.4
Slide 13: 4Q23 Advanced Circulatory Support Revenue
4Q23 Advanced Circulatory Support Revenue(1) Drivers/Impacts Net Revenue ($M) 4.9% In January 2024, LivaNova announced its intention to wind down the ACS segment with completion expected by the end of 2024. All ACS standalone cannulae and accessories will be transitioned into the Cardiopulmonary seg
Slide 14: 4Q23 Adjusted Segment Operating Income and Margin
4Q23 Adjusted Segment Operating Income and Margin(1) $66.5M % to Revenue $60.0M 4Q22 4Q23 Cardiopulmonary* 13.9% 11.8% Neuromodulation 36.2% 36.9% $50.5 $46.1 ACS (52.1)% (29.9)% Total Segment Margin 21.9% 21.5% Total Operating Margin(2) 17.0% 15.5% $18.9 $19.1 *4Q23 Cardiopulmonary adjusted operati
Slide 15: 2023 Adjusted Segment Operating Income and Margin
2023 Adjusted Segment Operating Income and Margin(1) $241.9M % to Revenue $198.5M 2022 2023 Cardiopulmonary* 11.2% 13.7% $175.3 Neuromodulation 34.7% 33.7% $165.6 ACS (58.9)% (35.1)% Total Segment Margin 19.4% 21.0% Total Operating Margin(2) 14.2% 14.7% $80.8 $56.1 *2023 Cardiopulmonary adjusted ope
Slide 16: 2023 Adjusted Free Cash Flow
2023 Adjusted Free Cash Flow Achieved $96M in adjusted free cash flow (FCF) for full-year 2023 Adjusted Free Cash Flow Reconciliation ($M) 1Q 2023 2Q 2023 3Q 2023 4Q 2023 2023 Net cash provided by operating activities $20.8 $(17.9) $18.1 $54.0 $74.9 Less: Purchases of plant, property and equipment (
Slide 17: 2023 Summary
2023 Summary • Full-year revenue increased 13%(1) with double-digit growth across all regions Financial • Adjusted operating income grew 17%; adjusted operating margin improvement of 50bps • Adjusted free cash flow of $96M driven by improvement in working capital partly offset by higher capital spen
Slide 18: 2024 Guidance
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Slide 19: 2024 Guidance
2024 Guidance Consolidated Guidance As of February 21, 2024 Net revenue growth(1) 4 - 5% Net revenue growth, excluding ACS(2) 6 - 7% Adjusted diluted EPS(1)(3) $2.95 - 3.05 Adjusted free cash flow(4) $95 - 115M Net revenue growth, Net revenue growth, excluding ACS, Adjusted diluted EPS and Adjusted
Slide 20: Assumptions for 2024
Assumptions for 2024 • Cardiopulmonary revenue growth of 6-7% (1) REVENUE (excluding ACS wind down) 6 - 7% • Epilepsy revenue growth of 6-7% • ACS wind down completion expected by the end of 2024 • Adjusted operating income margin increase of ~300bps and adjusted operating income growth of 25% • Inv
Slide 21: 2023 Adjusted Diluted EPS Bridge to 2024 Guidance
2023 Adjusted Diluted EPS* Bridge to 2024 Guidance $0.55 $3.00 $2.80 At midpoint of At midpoint of $0.50 - $0.60 $2.95 - $3.05 range range $0.45 ($0.45) ($0.35) 2023 Actual Tax Rate Cost Inflation & Infrastructure Heart Failure & ACS Exits Operational Growth & Leverage 2024 Guidance Investments * Ad
Slide 22: 2024 Strategic Focus
2024 Strategic Focus Serve patients around the world with leading technologies to advance the quality of care in neurological and cardiac health. Develop digitally integrated products and services that drive the Company's expanding role as an essential source of healthcare solutions. Expand customer
Slide 23: Appendix
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Slide 24: GAAP to Non-GAAP Reconciliations
GAAP to Non-GAAP Reconciliations The following tables reconcile the most comparable U.S. Generally Accepted Accounting Principles (GAAP) measures to the non-GAAP financial and operating measures presented in LivaNova’s fourth-quarter and full-year 2023 news release and during the conference call hel
Slide 25: 4Q23 Adjusted Diluted EPS
4Q23 Adjusted Diluted EPS* $0.15 $0.23 $1.89 $0.09 ($0.05) $0.15 $0.87 ($2.01) $0.12 $0.30 GAAP Depreciation and Impairment Financing Contingent Certain Legal and Stock-based Certain Tax Certain Interest Adjusted Financial Amortization Transactions Consideration Regulatory Costs Compensation Costs A
Slide 26: 2023 Adjusted Diluted EPS
2023 Adjusted Diluted EPS* $0.67 $1.12 $0.56 $2.80 $1.89 $0.17 ($0.45) ($1.99) $0.48 $0.32 $0.02 GAAP Restructuring Depreciation and Impairment Financing Contingent Certain Legal and Stock-based Certain Tax Certain Interest Adjusted Financial Expenses Amortization Transactions Consideration Regulato
Slide 27: GAAP to Non-GAAP Reconciliations - Unaudited
GAAP to Non-GAAP Reconciliations - Unaudited RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - UNAUDITED (U.S. dollars in millions, except per share amounts) Specified Items Depreciation and Certain Legal Stock-based Certain GAAP Restructuring Amortization Financing Contingent & Regulatory Com
Slide 28: GAAP to Non-GAAP Reconciliations - Unaudited
GAAP to Non-GAAP Reconciliations - Unaudited RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - UNAUDITED (U.S. dollars in millions, except per share amounts) Specified Items Depreciation Merger and and Certain Legal Stock-based Certain GAAP Integration Restructuring Amortization Financing Cont
Slide 29: GAAP to Non-GAAP Reconciliations - Unaudited
GAAP to Non-GAAP Reconciliations - Unaudited RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - UNAUDITED (U.S. dollars in millions, except per share amounts) Specified Items Depreciation Merger and and Certain Legal Stock-based Certain GAAP Integration Restructuring Amortization Financing Cont
Slide 30: GAAP to Non-GAAP Reconciliations - Unaudited
GAAP to Non-GAAP Reconciliations - Unaudited RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - UNAUDITED (U.S. dollars in millions, except per share amounts) Specified Items Depreciation Merger and and Certain Legal Stock-based Certain GAAP Integration Restructuring Amortization Financing Cont
Slide 31: GAAP to Non-GAAP Reconciliations - Unaudited
GAAP to Non-GAAP Reconciliations - Unaudited RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - UNAUDITED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES - UNAUDITED (U.S. dollars in millions) (U.S. dollars in millions) Three Months Ended Twelve Months Ended Adjusted free cash flow reconc
Slide 32: Segment Non-GAAP Reconciliation - Unaudited
Segment Non-GAAP Reconciliation - Unaudited (U.S. dollars in millions) Specified Items Depreciation & Contingent Certain Legal and Stock-based Three Months Ended GAAP Financial Amortization Impairment Consideration Regulatory Costs Compensation Adjusted Financial December 31, 2023 Results (A) (B) (C