ABMD
$186.66
Abiomed
$1.41
.76%
Earnings Details
2nd Quarter September 2019
Thursday, October 31, 2019 7:00:00 AM
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Summary

Abiomed Beats

Abiomed (ABMD) reported 2nd Quarter September 2019 earnings of $1.03 per share on revenue of $205.0 million. The consensus earnings estimate was $0.93 per share on revenue of $206.3 million. The Earnings Whisper number was $0.93 per share. Revenue grew 12.8% on a year-over-year basis.

The company said it continues to expect fiscal 2020 revenue of $885.0 million to $925.0 million. The current consensus estimate is revenue of $892.7 million for the year ending March 31, 2020.

Abiomed Inc is engaged in providing mechanical circulatory support devices and it offers a continuum of care in heart recovery to heart failure patients.

Results
Reported Earnings
$1.03
Earnings Whisper
$0.93
Consensus Estimate
$0.93
Reported Revenue
$205.0 Mil
Revenue Estimate
$206.3 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Abiomed Announces Q2 FY 2020 Revenue of $205 Million and 29.4% Operating Margin

DANVERS, Mass.--(BUSINESS WIRE)--Abiomed, Inc. (NASDAQ: ABMD), a leading provider of breakthrough heart recovery and support technologies, today reported second quarter fiscal 2020 revenue of $205.0 million, an increase of 13% compared to revenue of $181.8 million for the same period of fiscal 2019. Operating income was $60.2 million, up 20%, compared to $50.3 million in the same period of fiscal 2019.

Financial and operating highlights for the second quarter fiscal 2020 include:

  • U.S. revenue totaled $172.0 million, an increase of 9% compared to revenue of $158.2 million during the same period of fiscal 2019 with U.S. patient usage of Impella heart pumps up 14%. In the second quarter, we opened 62 new sites, compared to 135 sites in the prior year, which impacted our U.S. growth rate by $3 million in revenue, or approximately two points of growth.
  • Outside the U.S., revenue totaled $33.0 million, an increase of 40% compared to revenue of $23.5 million during the same period of fiscal 2019. Specifically, Japan revenue was $9.6 million in the quarter, up 135% compared to the same period of fiscal 2019.
  • Gross margin was 83.0% compared to 83.6% during the same period of fiscal 2019.
  • Operating income was $60.2 million, or 29.4% operating margin compared to $50.3 million, or 27.7% operating margin in the same period of fiscal 2019.
  • GAAP net income was $13.1 million, or $0.28 per diluted share, which includes a $34.5 million, or $0.75 per share, unrealized loss from our investment in Shockwave. This compared to GAAP net income of $50.1 million or $1.09 per diluted share for the prior fiscal year, which benefited from $12.9 million, or $0.28 per share, of excess tax benefits.
  • The company generated operating cash flow of $74.3 million in the second quarter and $138.9 million year to date, an increase of 30% versus prior year. As of September 30, 2019, the company had $551.3 million of cash and marketable securities and maintains no debt.
  • On September 23, the company announced that the highest court in Germany, the Federal Court of Justice, ruled in favor of Abiomed in a patent challenge, specifically around the pigtail and design for insertion, filed by Thoratec in 2015, validating the strengths of Abiomed’s Impella-related patents. Abiomed has invested more than $500 million and 20 years of research and development for Impella and owns a robust world-wide portfolio of 715 patents and 622 patents pending, covering all aspects of its existing and future products.
  • On September 25, the company announced that the Impella 5.5 with SmartAssist received U.S. Food and Drug Administration (FDA) pre-market approval (PMA) for safety and efficacy in the therapy of cardiogenic shock for up to 14 days. Impella 5.5 with SmartAssist is a minimally invasive, forward flow, fully unloading heart pump designed for heart surgeons, implanted via axillary artery or direct to the aorta.
  • On September 26, the company announced the results of PROTECT III, the ongoing, prospective, single-arm FDA post-approval study for the PMA approval of Impella 2.5 and Impella CP in high-risk PCI. PROTECT III follows the PROTECT II Randomized Controlled Trial (RCT). The findings of this interim analysis on 898 patients demonstrates a reduction in the primary endpoint of death, stroke, myocardial infarction and repeat procedures at 90 days with Impella-supported Protected PCI, compared to PROTECT II.
  • On September 27, the company announced that data presented from the National Cardiogenic Shock Initiative Study (NCSI) on 250 consecutive AMI cardiogenic shock patients from 49 sites demonstrates 72% survival at discharge with 98% native heart recovery. The patients were treated with the NCSI protocol, which includes placing Abiomed’s Impella heart pump before revascularization via percutaneous coronary intervention (PCI). Investigators also now plan to institute new escalation protocols that will be applied in the cath lab immediately after Impella-supported PCI in order to further increase patient survival and native heart recovery.
  • On October 7, the company announced that the 1,000th patient has been treated with the Impella heart pump in Japan. Procedural outcomes data, available on the first 580 Japanese cases, demonstrates improvements in AMI cardiogenic shock and myocarditis survival rates during the procedure, compared to traditional therapies. The protocols used to introduce Impella in Japan were developed based on best practices learned from the experience treating patients in Europe and the United States, including the National Cardiogenic Shock Initiative, the Impella Quality (IQ) Database and the cVAD Study.
  • On October 25, the company announced that the FDA Post Approval Study demonstrates timely identification of right heart failure and early use of Impella RP leads to higher survival. When physicians followed the FDA’s approved protocol for Impella RP use they achieved 72% patient survival and 88% native heart recovery. These results, from the Impella RP’s post-approval study, match the survival rate in the Impella RP’s pre-approval study.
  • Today, the company announces the first U.S. patients treated with Impella 5.5 with SmartAssist. The first 10 patients were treated at the Cleveland Clinic, Hackensack Meridian Health and Cedars-Sinai Medical Center in Los Angeles. The Impella 5.5 with SmartAssist is being introduced in the U.S. through a controlled rollout at hospitals with established heart recovery protocols.

“We are pleased that this quarter demonstrated our ability to leverage best practices and support strategies to improve clinical outcomes overall for high risk PCI, cardiogenic shock and right heart failure,” said Michael R. Minogue, Chairman, President and Chief Executive Officer, Abiomed, Inc. “We have made progress on our key initiatives in the quarter, but we still have more work to do. Our innovation and ability to improve clinical outcomes remains the driver for Impella adoption through a function of training, data and time.”

FISCAL YEAR 2020 OUTLOOK

The company is maintaining its fiscal year 2020 guidance for total revenue to be in the range of $885 million to $925 million, an increase of 15% to 20% over the prior year. The company is also maintaining its fiscal year 2020 guidance for GAAP operating margin to be in the range of 28% to 30%.

EARNINGS CONFERENCE CALL DETAILS

The company will host a conference call to discuss the results at 8:00 a.m. EDT on Thursday, October 31, 2019. The conference call releasing full quarterly results will be hosted by Michael R. Minogue, Chairman, President and Chief Executive Officer and Todd A. Trapp, Vice President and Chief Financial Officer.

To listen to the call live, please tune into the webcast via https://edge.media-server.com/mmc/p/7yfz5bxh or dial (855) 212-2361; the international number is (678) 809-1538. A replay of this conference call will be available beginning at 11:00 a.m. EDT October 31, 2019 through 11:00 a.m. EST on November 7, 2019. The replay phone number is (855) 859-2056; the international number is (404) 537-3406. The replay access code is 7594662.

ABOUT ABIOMED

Based in Danvers, Massachusetts, USA, Abiomed, Inc. is a leading provider of medical devices that provide circulatory support. Our products are designed to enable the heart to rest by improving blood flow and/or performing the pumping of the heart. For additional information, please visit: www.abiomed.com. Abiomed, Impella, Impella 2.5, Impella 5.0, Impella LD, Impella CP, Impella RP, and Impella Connect are registered trademarks of Abiomed, Inc., and are registered in the U.S. and certain foreign countries. Impella BTR, Impella 5.5, Impella ECP, CVAD Study, and SmartAssist are pending trademarks of Abiomed, Inc.

FORWARD-LOOKING STATEMENTS

This release contains forward-looking statements, including, without limitation, statements regarding development of Abiomed's existing and new products, the company's progress toward commercial growth, and future opportunities and expected regulatory approvals. All statements, other than statements of historical facts, may be forward-looking statements. These forward-looking statements may be accompanied by such words as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “potential,” “project,” “target,” “should,” “likely,” “will” and other words and terms of similar meaning. The company's actual results may differ materially from those anticipated in these forward-looking statements based upon a number of factors, including, without limitation: the company’s dependence on Impella® products for all of its revenues; the company’s ability to successfully compete against its existing or potential competitors; the acceptance of the company’s products by cardiac surgeons and interventional cardiologists; long sales and training cycles associated with expansion into new hospital cardiac centers; reduced market acceptance of the company’s products due to lengthy clinician training process; the company’s ability to effectively manage its growth; the company’s ability to successfully commercialize its products; the company’s ability to obtain regulatory approvals and market and sell its products in certain jurisdictions; enforcement actions and product liability suits relating to off-label uses of the company’s products; unsuccessful clinical trials or procedures relating to products under development; the company’s ability to maintain compliance with regulatory requirements; the failure of third-party payers to provide reimbursement of the company’s products; the company’s ability to increase manufacturing capacity to support continued demand for its products; the company or its vendors’ failure to achieve and maintain high manufacturing standards; the failure of the company’s suppliers to provide the components the company requires; the company’s ability to expand its direct sales activities into international markets; the outcome of ongoing securities class action litigation relating to our public disclosures and other risks and challenges detailed in the company's filings with the Securities and Exchange Commission (the “SEC”), including the most recently filed Annual Report on Form 10-K and the filings subsequently filed with or furnished to the SEC. Readers are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this release. Unless otherwise required by law, the company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances that occur after the date of this release or to reflect the occurrence of unanticipated events.

Abiomed, Inc. and Subsidiaries
Consolidated Balance Sheets
(Unaudited)
(in thousands, except share data)
 
September 30, 2019March 31, 2019
ASSETS
Current assets:
Cash and cash equivalents

 $

150,279

 

 $

121,021

 

Short-term marketable securities

 

                    295,041

 

 

                    370,677

 

Accounts receivable, net 

 

                      94,319

 

 

                      90,809

 

Inventories 

 

                      90,295

 

 

                      80,942

 

Prepaid expenses and other current assets

 

                      17,498

 

 

                      13,748

 

Total current assets

 

                    647,432

 

 

                    677,197

 

Long-term marketable securities

 

                    106,025

 

 

                      21,718

 

Property and equipment, net

 

                    157,896

 

 

                    145,005

 

Goodwill

 

                      31,727

 

 

                      32,601

 

In-process research and development

 

                      14,800

 

 

                      15,208

 

Long-term deferred tax assets, net

 

                      67,277

 

 

                      77,502

 

Other assets

 

                      99,191

 

 

                      85,115

 

Total assets

 $

1,124,348

 

 $

1,054,346

 

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable

 $

31,736

 

$

32,185

 

Accrued expenses

 

                      57,907

 

 

                      57,420

 

Deferred revenues

 

19,322

 

 

16,393

 

Other current liabilities

 

                        3,264

 

                             —
Total current liabilities

 

                    112,229

 

 

                    105,998

 

Contingent consideration

 

                      10,236

 

 

                        9,575

 

Long-term deferred tax liabilities

 

                           800

 

 

                           822

 

Other long-term liabilities

 

                        9,626

 

 

                        1,061

 

Total liabilities

 

                    132,891

 

 

                    117,456

 

Commintments and contingencies
Stockholders' equity:
Class B Preferred Stock, $.01 par value                             —                             —
Authorized - 1,000,000 shares; Issued and outstanding - none
Common stock, $.01 par value

 

                           452

 

 

                           451

 

Authorized - 100,000,000 shares; Issued - 47,484,911 shares at September 30, 2019 and 47,026,226 shares at March 31, 2019 
Outstanding - 45,238,952 shares at September 30, 2019 and 45,122,985 shares at March 31, 2019
Additional paid in capital

 

                    722,020

 

 

                    690,507

 

Retained earnings 

 

                    501,467

 

 

                    399,473

 

Treasury stock at cost - 2,245,959 shares at September 30, 2019 and 1,903,241 shares at March 31, 2019

 

                   (214,926

)

 

                   (138,852

)

Accumulated other comprehensive loss

 

                     (17,556

)

 

                     (14,689

)

Total stockholders' equity

 

                    991,457

 

 

                    936,890

 

Total liabilities and stockholders' equity

 $

1,124,348

 

 $

1,054,346

 

Abiomed, Inc. and Subsidiaries
Consolidated Statements of Operations
(Unaudited)
(in thousands, except per share data)
 
 
For the Three Months Ended September 30,For the Six Months Ended September 30,

2019

2018

2019

2018

Revenue

 $204,974

 $181,778

 $412,640

 $361,788

Costs and expenses:
Cost of revenue 

          34,867

          29,846

        71,940

        60,696

Research and development 

          23,969

          22,717

        47,759

        43,990

Selling, general and administrative 

          85,956

          78,895

      172,034

      160,034

 

        144,792

        131,458

      291,733

      264,720

Income from operations

          60,182

          50,320

      120,907

        97,068

Other (expenses) income:
Investment income, net

            2,932

            1,671

          5,981

          3,222

Other (expense) income, net

        (45,756)

             (158)

         (6,392)

               30

 

        (42,824)

            1,513

            (411)

          3,252

Income before income taxes

          17,358

          51,833

      120,496

      100,320

Income tax provision (benefit)

            4,287

            1,706

        18,502

       (39,873)

Net income (A)

 $13,071

 $50,127

 $101,994

 $140,193

 
Basic net income per share

 $0.29

 $1.11

 $2.25

 $3.13

Basic weighted average shares outstanding

          45,319

          44,961

        45,267

        44,754

 
Diluted net income per share (B)

 $0.28

 $1.09

 $2.22

 $3.04

Diluted weighted average shares outstanding

          45,912

          46,153

        46,031

        46,164

 
(A) Net income includes the effect of the following items:
Excess tax benefits related to stock-based compensation awards (1)

 $(469)

 $(12,928)

 $(13,290)

 $(66,765)

Unrealized loss on investment in Shockwave Medical - net of tax (2)

          34,508

                 —

 $4,496

               —
 

 $34,039

 $(12,928)

 $      (8,794)

 $(66,765)

(B) Diluted net income per share includes the effect of the following items:
Excess tax benefits related to stock-based compensation awards (1)

 $(0.01)

 $(0.28)

 $(0.29)

 $(1.45)

Unrealized loss on investment in Shockwave Medical  (2)

              0.75

                 — 

            0.10

               —
 

 $0.74

 $(0.28)

 

 $(0.19)

 $ (1.45)

(1) Amount represents the impact of excess tax benefits and shortfalls associated with stock-based awards in each respective period presented.

(2) In the second quarter of fiscal 2020, the company recorded an unrealized loss on its investment in Shockwave Medical of $45.8 million ($34.5 million, net of tax benefit) and is recorded within other income (expense), net.

Ingrid Goldberg
Director, Investor Relations
978-646-1590
ir@abiomed.com

Tom Langford
Director, Communications & Public Relations
978-882-8408
tlangford@abiomed.com

Source: Abiomed, Inc.