Masimo Corporation · NASDAQ:MASI
Masimo — Q3 2020 Earnings Presentation
20 slides from Masimo's earnings presentation, Oct 27, 2020
Slide 1: Third Quarter 2020 Earnings Presentation
Third Quarter 2020 Improving Patient Outcomes Earnings Presentation | October 27, 2020 Reducing the Cost of Care®
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS These presentations contain forward-looking statements within the meaning of federal securities laws, including, among others, statements about our expectations, plans, strategies or prospects. We generally use the words “may,” “will,” “expect,” “believe,” “anticipate,” “p
Slide 3: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES The non-GAAP financial measures contained herein are a supplement to the corresponding financial measures prepared in accordance with U.S. GAAP. The non-GAAP financial measures presented exclude certain items that are more fully described in the Appendix. Management belie
Slide 4: Third Quarter 2020 Highlights
Third Quarter 2020 Highlights Total revenue, including royalty and other revenue, increased 21.4% to $278.1 million Revenue Product revenue increased 21.5% to $278.1 million, or 21.1% on a constant currency basis(1) Shipments Shipments of noninvasive technology boards and instruments were 151,
Slide 5: Third Quarter 2020 Results – GAAP
Third Quarter 2020 Results – GAAP(1) (in millions; except % and EPS) Q3 2020 Q3 2019 vs. Prior Year Comments Revenue $278.1 $229.0 21.4% Increased demand driven by higher volumes of technology boards and instruments. Gross margin decrease due to a higher than usual proportion of revenue coming from
Slide 6: Third Quarter 2020 Results – Non-GAAP
Third Quarter 2020 Results – Non-GAAP(1) vs. Prior Year Constant (in millions; except % and EPS) Q3 2020 Q3 2019 Reported Comments Currency Increased demand driven by higher volumes of technology Revenue $278.1 $228.9 21.5% 21.1% boards and instruments. Gross margin decrease due to a higher than usu
Slide 7: Third Quarter 2020 Results – Non-GAAP
Third Quarter 2020 Results – Non-GAAP(1) Non-GAAP(1) Non-GAAP(1) Product Revenue Operating Margin EPS $278M 23.0% $229M 21.9% $0.80 $0.76 Constant Currency +21.1%Growth(1) (110) bps +5.3% Q3 2019 Q3 2020 Q3 2019 Q3 2020 Q3 2019 Q3 2020 (1) Non-GAAP measures shown have been adjusted for certain items
Slide 8: Full Year 2020 Financial Guidance
Full Year 2020 Financial Guidance Total revenue, including royalty and other revenue, of $1,128 million Revenue Product revenue increasing 20.5% to $1,128 million on a reported and constant currency basis(1) GAAP operating margin of 22.5% Profitability Non-GAAP operating margin(1) of 23.0%
Slide 9: Full Year 2020 Financial Guidance – GAAP
Full Year 2020 Financial Guidance – GAAP(1) (in millions; except % and EPS) FY 2020 FY 2019 vs. Prior Year Comments Revenue $1,128.0 $937.8 20.3% Increased demand driven by higher volumes of technology boards and instruments. Gross margin decrease due to a higher than usual proportion of revenue com
Slide 10: Full Year 2020 Financial Guidance – Non-GAAP
Full Year 2020 Financial Guidance – Non-GAAP(1) vs. Prior Year Constant (in millions; except % and EPS) FY 2020 FY 2019 Reported Comments Currency Increased demand driven by higher volumes of technology boards and Revenue $1,128.0 $936.4 20.5% 20.5% instruments. Gross margin decrease due to a higher
Slide 11: Full Year 2020 Financial Guidance – Non-GAAP
Full Year 2020 Financial Guidance – Non-GAAP(1) Non-GAAP(1) Non-GAAP(1) Product Revenue Operating Margin EPS $1,128M 24.0% $3.46 23.0% $3.22 $936M Constant Currency +20.5%Growth(1) (100) bps +7.5% FY 2019 FY 2020 FY 2019 FY 2020 FY 2019 FY 2020 (1) Non-GAAP measures shown have been adjusted for cert
Slide 12: Appendices: GAAP to Non-GAAP Adjustments and Reconciliations
APPENDICES Improving Patient Outcomes GAAP to Non-GAAP Reducing the Cost of Care® Adjustments and Reconciliations
Slide 13: Description of Non-GAAP Adjustments
Description of Non-GAAP Adjustments The non-GAAP financial measures reflect adjustments for the following items, as well as the related income tax effects thereof: Constant currency adjustments Some of our sales agreements with foreign customers provide for payment in currencies other than the U.S.
Slide 14: Description of Non-GAAP Adjustments
Description of Non-GAAP Adjustments Realized and unrealized gains or losses from foreign currency transactions: We are exposed to foreign currency gains or losses on outstanding foreign currency denominated receivables and payables related to certain customer sales agreements, product costs and othe
Slide 15: Constant Currency Product Revenue
Constant Currency Product Revenue(1),(2) RECONCILIATION OF GAAP PRODUCT REVENUE GROWTH TO CONSTANT CURRENCY PRODUCT REVENUE GROWTH (in thousands, except percentages) 2020 Full Year Q3 2019 FY 2019 Q3 2020 Guidance (3) GAAP product revenue $ 228,916 $ 936,408 $ 278,112 $ 1,128,000 Constant currency F
Slide 16: Non-GAAP Gross Margin %
Non-GAAP Gross Margin %(1),(2) RECONCILIATION OF GAAP GROSS PROFIT/MARGIN TO NON-GAAP GROSS PROFIT/MARGIN: (in thousands, except percentages) 2020 Full Year Q3 2019 FY 2019 Q3 2020 Guidance (3) GAAP gross profit/margin$ 156,268 $ 629,172 $ 178,926 $ 739,500 Non-GAAP adjustments: Royalty and other re
Slide 17: Non-GAAP Operating Expense %
Non-GAAP Operating Expense %(1),(2) RECONCILIATION OF GAAP OPERATING EXPENSES TO NON-GAAP OPERATING EXPENSES: (in thousands, except percentages) 2020 Full Year Q3 2019 FY 2019 Q3 2020 Guidance (3) GAAP selling, general and administrative operating expenses$ 80,354 $ 314,661 $ 90,376 Non-GAAP adjustm
Slide 18: Non-GAAP Operating Margin %
Non-GAAP Operating Margin %(1),(2) RECONCILIATION OF GAAP OPERATING INCOME/MARGIN TO NON-GAAP OPERATING INCOME/MARGIN: (in thousands, except percentages) 2020 Full Year Q3 2019 FY 2019 Q3 2020 Guidance (3) GAAP operating income/margin$ 51,632 $ 221,216 $ 59,698 $ 253,300 Non-GAAP adjustments: Royalt
Slide 19: Non-GAAP Net Income and Diluted EPS
Non-GAAP Net Income and Diluted EPS(1),(2) RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME: (in thousands, except percentages) 2020 Full Year Q3 2019 FY 2019 Q3 2020 Guidance (3) GAAP net income $ 49,085 $ 196,216 $ 49,405 $ 219,400 Non-GAAP adjustments: Royalty and other revenue, net of re
Slide 20: Adjusted Free Cash Flow
Adjusted Free Cash Flow(1),(2) RECONCILIATION OF FREE CASH FLOW TO ADJUSTED FREE CASH FLOW (in thousands, except percentages) Q3 2019 FY 2019 Q3 2020 Net cash provided by operating activities Net cash provided by operating activities$ 50,637 $ 221,640 $ 40,478 Purchases of property and equipment, ne