Rockwell Medical (RMTI) 30 Mar 232022 Q4 Earnings call transcript

Good morning, and welcome to Rockwell Medical's Fourth Quarter and Full-Year 2022 Results Conference Call and Webcast. Please note, this event is being recorded.

At this time, I would like to turn the conference call over to Heather Hunter, Senior Vice President, Chief Corporate Affairs Officer at Rockwell Medical. Heather, please go ahead.

Good morning, and thank you for joining us for this update on Rockwell Medical.

conference Dr. today's on me call are Joining President, Mark Tim President, Chole, Medical’s President Senior Sales Accounting Executive Officer; and Chief Vice Medical's Rockwell Rockwell Marketing; Paul Strobeck, and and Chief Officer. Rockwell and McGarry, Finance Medical's Senior Vice

begin, annual of to SEC, available our Investors with website our remind cause subject forward-looking I Form periodic subsequent limited laws could but results and the the call that are federal actual report XX-K this you which on to Medical Rockwell to to, like reports filed uncertainties risks statements section. of under not on as the These forward-looking securities in statements contain about would all and are statements the our within we that conference Before will the identified types meaning including, differ.

reports or Please and opinions obligation required law, reflect that we note specifically cause in Except from in-light by with or actual materially expectations only outcomes update these statements differ or to in our expressed SEC. these any those forward-looking as that of events. could in periodic detail today. statements of new by revise the are such our future greater disclaim results discussed or information forward-looking Factors filed implied statements forward-looking as to

business webcast. and a Medical's as today’s release filed company's annual along under of Medical's section the this to prior the call can was as ended report this analysis the with and XXXX of Rockwell on a results. It be XX, found company's Form quarter website year XX-K well the December provides on full Rockwell XXXX fourth for and full-year strategy, press recording Investors

like call CEO, Rockwell turn to President Strobeck. over Now, and to conference would I Dr. Mark Medical's the

for today conference XXXX you, us Heather. Rockwell and and quarter fourth full-year call morning, joining for results Medical's and thank you webcast. Good everyone, Thank

this with a number we want review to that have morning. We accomplishments you of exciting

let’s So, started. get

to a to Rockwell remind new of a a of you following revenue minutes is develops, those healthcare that who Rockwell hemodialysis like of Medical been dialysis and and you providers strategy. for who our model of take worldwide. distributes are commercializes, to have few manufacturers, portfolio company and Medical I’d those For us time, products business for for updated generating everyone some

transportation Rockwell’s is they by the dialysis supported highest has the dialysis products, along the the and with one scalability the manufacturing products dialysis in of provide concentrates and hemodialysis mission best the to United the suppliers clinics supplier States, infrastructure service over customer is service to markets. is select clinics Rockwell patients international that United in in only X,XXX with quality industry. States second serve largest of two life-sustaining the the in clinics

in expanding which the grow Rockwell approximately large player States as approximately valued in is and $XXX a indispensable positions and XXXX. market, in currently This United projected at to to million million alone $XXX an is

Our to vision providers of concentrates become dialysis the worldwide. hemodialysis global supplier leading to is

de-levering XXXX. evaluation successful, Rockwell's together July businesses, and us we be team Rockwell underwent that for board intensive improving and capital focus on our pause businesses, drive enhancing financial our our profitability in need our to revenue to generating focus condition, on company, efforts this assessment and and After directors Medical of extensive last Rockwell our in determined of with an I joining and of businesses year, management to

The revised these We focused key that objectives. is is goals XXXX the for and and working. full-year here third believe are for and business and gross operating profit are fourth takeaway making significant now is the progress quarter the second is towards Revenue results and our that quarter we reported expenses growing, that increasing, demonstrate we model and declining.

made we of In results. fourth our full-year to of turn the attention quarter and operational XXXX, to XXXX our operational number let's fourth a improvements business. Rockwell's Now, quarter

we reacquired point that critical into the agreement originally from products exclusive First, back and entered terminated concentrates for distribution Rockwell. to distribution a hemodialysis transaction Rockwell inflection marked Baxter our in rights our XXXX. This

the our our ourselves of of restrictive impossible long-term for from number preferred made Baxter economics. agreements to lifted first that agreement and us destiny. to time the business elements us allows it with supply to a Removing business this establish Re-acquisition grow control for own

transitioning the establishing and existing is opportunities new United customers progress commercial commercial provide to ahead actively Our Baxter will onboarding and dollar and with the States purchase, agreements. making are and Tim supply, product we lie you for Rockwell. in transition the more details and long-term business team on the Rockwell, multimillion the distribution abroad, with that

our Additionally, We development as the reduced fourth our overall top U.S., the non-core revenue, headcount eliminated operations. product G&A put areas expense. streamlined our and associated reduced decision cash business We line improve our made Triferic quarter, activities and our in to we on-hold. reduced platform the with of related burn, to to expenses this associated we in FPC and move strategic away from with the continued

develop had AVNU their South Triferic Triferic approved international Rockwell were partnerships In looking respective commercialize in companies the during third quarter. Korea our in and countries. Korea launched with GEO XXXX, and several Pharmaceutical South to partner in Triferic Triferic and

actively realize have license of are to associated and already supply keeping GEO's revenue agreements. and begun Triferic's track We with adoption market

X subsidiary XXXX in study a Pharma, partner its mid-XXXX. in of expect study from completed quarter we China, and pivotal Phase this In fourth in addition, the results our of Fosun

operational partnerships Rockwell. reminder, little require a capital from very no As expenditure and international these resources

While generate revenue this the to the have potential and not factored our long-term near have revenue forecasts. for they company, into we

the to come. work during would it expenditures Rockwell development program many this relates required significant capital quarter value put realize years for this FPC and for we we from that on-hold to announced of Infusion, XXXX because it not program fourth for As Home

activities consider with this FPC the at FDA as acute development for the meeting for heart of provided pre-IND future a conducted we which successful insight As XXXX, for useful end program. failure, the we

us Rockwell achieves is we and available discussed this sustainable As for reconsider once profitability. program previously, have is to currently on-hold

Before illustrates the our in release. objectives we more financials transition felt direct this transparent, against this impact our to take the our This way communicates we I progress format believe clearly get press are this that to per and results, presenting financials. and customary into we wanted our new updated straightforward manner, results our a in of moment evolved revenue our in successful presented on we time is and morning's the share. a earnings financial businesses to making measurement to and type it address format of which was financial We generating

million XXXX, third consecutive our pleased achieving which $XX.X we report company's I represented for record in that to revenue, fourth am the in the quarter revenue quarter reported history.

increase XXXX, For the period when and generated million revenue the represents Rockwell the compared full-year revenue highest full-year which to company. in in guidance, to comparable for the $XX.X XXXX a our date XX.X% exceeding

XXXX. XXXX interest quarter of XXXX, as a our opportunity only XXXX. our agreement of an interest the of last into payment down fourth September debt loan prepayment $XX with of X, by long-term existing Rockwell a December its accelerating XX, pay Medical loan entered with the on of amendment starting we our our debt leaving December period XX-month This of ending million expense with and million X, Rockwell to to During agreeing offers the reduce $X

with As plan with expanding by We preferred growing customers, agreements commercially look to our into focus are business geographies, on XXXX, adding supply economics. agreements we to clear. optimizing new our new with long-term objectives existing very corporate customers

focus We expect continue and expenses business to to our our operating on reducing efficiently. more

our to seek continue to At goals our $XX XX% top to ways to of further reduce this concentrates range, and hemodialysis XXXX, financial condition generate enhance find demand in in the $XX that XXXX. to Based million revenue for revenue on we million represents these over forecasted a increase to products ways plan in in our debt. We expect XXXX. and

million profit in are In company continue addition, achieve with have in gross business and generate million and expecting we profitability to XXXX. make $X XXXX stronger position. made forward stable decisions put financial to consistent a between we more to our $X drive in our strategy The to going are the and

fourth anticipate revenue renewals. of on will timing way of for well first are contract the the the the and transition of reflecting in-line be our in quarter Baxter We XXXX with in revenue that quarter XXXX,

renal would significantly XX largest years than who care Senior Vice commercial to President you Marketing in our to has introduce and experience had our renal Tim sales. world of leads Sales like successfully and and in more Tim of Rockwell. of companies portfolios Now, marketing the Chole, organization built some their I grown the sales and here at at care

turn with provide to Tim our update business. call commercial now will concentrates I related over a to to the hemodialysis you

focused now and Baxter for distribution you, strategy hemodialysis exclusive Mark. is re-acquiring commercial distribution two from Thank rights agreement, our Since terminating the key areas. our the products on

Rockwell, the hospitals, the to to we're Baxter centers, than First, life XXX patients. serve get former transitioning ensure to our that products sustaining hemodialysis focused health more on and continue customers to systems centers, that dialysis medical

establish this and working supply systematically of pleased report with responsibility customers each I'm and We're now with arrangements. successfully assumed we've agreements Baxter's terms is on-track long-term for to preferred new transition commercial customers. these conditions that to and

which associated we customers economics the benefits all previously Rockwell, This customers, capturing our to agreement. under of of the our Baxter Rockwell in more Now, were these stockholders, with unable long-term. and is the ultimately do

concentrate new business and by was that market strategic into previously arrangement. access to under second customers hemodialysis grow The to geographies us our priority the is of to adding Baxter portions new unavailable expanding

into XXXX, capabilities our estimated In patients our hemodialysis distribution X,XXX partner working we excited be their and westward products. quarter are largest centers with Minnesota an our the dialysis further to support fourth expanded life more sustaining to of closely and additional with

new two that last announced we month with Additionally, two new agreements partners. supply signed we

Concerto United multimillion dollar the agreement supply skilled non-profit States. largest largest in is in is nursing a And dialysis the provider agreement facilities dollar dialysis agreement product States. with and The Renal United three-year purchase three-year first the a the with agreement Services, provider the of multimillion second

minimum of concentrates to our These this these and drive profitability purchase many agreements increase of hemodialysis annual as include opportunity in are grow. establishing first that commitments businesses the toward respective Each to customers' business Rockwell we multi-year and have our arrangements the year grow XXXX. anticipate

Hemodialysis Rockwell's and core focus competency. our concentrates

we highest the disruptions that market. this other become the global want the we work in because quality the dedicated Given ever recently, Rockwell service with to more supported to experienced providing in than best are the leader determined industry. by Customers products customer suppliers to are have now

making that lie I'm personally progress the opportunities excited the Rockwell. for we've about very been ahead and

to turn I'll Paul, to through financial results. call the and our Now, fourth quarter over go XXXX full-year

XXXX. December you, the increase was XXXX XX, XXXX XX.X Revenue Revenue XX.X of increase Thank This months for a XX.X% represents in three period which ended over the million, a was December the Tim. XX% XXXX. XX, comparable ended year for million. same the over period represents

in fourth was for the year-over-year. represents used XXXX. operating compared of million to the XX.X used for X for XXXX, activities cash XXX,XXX quarter operating of Net million activities full-year comparable activities cash in in with reduction compared XXXX, used the period for operating which cash fourth million XXXX, of XX% in XX.X quarter a in Net the was

ended was for per the or XXXX. For the period same Rockwell's X.X of three loss months net compared $X.XX a of December XXXX, X.X share, million share loss million $X.XX or with XX, net per

For the or December or XX, loss compared in million loss share million Rockwell's year share, was per net net XXXX. $X.XX ended $X.XX of per with XX.X XX.X a XXXX,

Rockwell of accelerated Medical quarter million. at XX.X cash million at million cash prepayment XXXX Comparatively, XX, fourth down with XXXX. XX, the equivalents as XX.X During December was September XX.X million XXXX, million Rockwell's the of of leaving Rockwell's XXXX, $X pay at XX, our XX, we December outstanding compared debt debt debt at existing our with and December to XXXX. long-term XX the loan was of

these The our related prepayment Rockwell to the $X balance severance is million cost charges, cash a cash becoming associated reduction moving Absent purchase of includes one-time neutral. and one-time equipment flow debt and significantly with closer in expenses.

us remain financial we on performance profitability growth pleased Overall, for towards full-year fourth continuing as to the we're in position in of with focused and drive future our quarter XXXX. XXXX and

Mark. to over back call the turn now will I

Operator, lines for you, Thank the phone please any open Paul. questions.

comes And first from Instructions] the of line question Selvaraju [Operator today H.C. Wainwright. [ph] from your [Sam]

Your line is open.

for taking hear Can much my very Thanks me? questions. you

We can.

acquire whether business? how in guidance? you concentrates market year are on So, dynamics to so I the was potential line particular, underlying dialysis, evolving as sense market comment just you drivers of current top a wondering far, to general your could seeing you particularly And share, XXXX the this upside look in hemodialysis

Yes. Thank those questions. you for

of out shift So, of is first. what what we a let has me period and the market to of second increase that's see first see we're begun that for that that start, what that in sort there that path certainly and the was seeing What off meaning or seeing to patient decline the the is slow today dialysis a start is potentially beginning businesses now time one reporting providers in as leveling with to in XXXX COVID. I are and occurring growth come declining senses. resume, patient are dialysis a those census we're to And during think that

move dialysis that which I from the we're probably this what will time beginning industry perspective, think it So, growth to through to previously used been the obviously a are are back then seem that to has serious this surface of patients. first and a in business, start to contraction for concentrates didn't amount now in those impact

dynamics concentrate those well. we're the the share need continual the shifting dialysis in that there the comment towards to continuing here to point in exist lion's the would as supply of I secondly, think for U.S. again, clinics that abroad. see hemodialysis and And I market, Rockwell

fortunate Rockwell has to and but service, reputation the not those one are in as distribution, customer We know for is that excited well industry its that the access. only are of products its the quality that therefore not only its

going so, we've and at started beginning to to the second seen is already growth you've And the path that that customers accelerated of announced us year. addition for we've of be the

Very much color. appreciate that

ones. Just two other quick

a of debt if of XXXX? low how of it what the respect still in you the management could you us expect And do to of position to down quarter also during [fee XXXX, and to with was can [ph] potentially of in-light particularly trend give spending] sense paying continuing you during you Firstly, further Thank XXXX? fourth comment expect on the course how it you.

Yes.

in priority towards continue XXXX, well more key That organization. management given efficient So, although our for a a to it products, in us as operate includes we production as to spending the is business haven't our manner. guidance this of of

So, that what the operating to associated to find would work try this is, business. continue incredibly we say to I to to expenses decrease to going are hard ways to with continue

set XXXX the are for flexibility way [Novartis] continue again XXXX set that up, our Second, agreement to we debt, to the is in to to that to by look ways [ph] on the provide business. for we're or pay accelerate continue that going off to

contemplated allows look way end in the us So, we that plan to XXXX, consistently but agreement, off by the ways follow which the that to to going said, as are or payment pay to accelerate I schedules in for that. period the by we're a

you. Thank

Your from Cantor next Brandon question from comes the Fitzgerald. of Folkes line

is open. line Your

taking for the questions all Thanks and congratulations progress. my Hi. on

And of the sort obviously see on to can few think like mean or over very do of strategy? opportunity about much progress from looks how XXXX, you. Just next you about Maybe, me. based where the of of in the maybe, help a in level kind one few within progress continue continued you XXXX the versus of high years? just in we Thank that conceptualize growing How of, terms cost are is, that significant you what optimizing us on and, think by should I sort the the sort evolving structure strategy but concentrate next guidance, years? the, sort tremendous

Yes. Thanks Brandon.

a to objective the – of revenue. a to a this do worldwide. have previously, to to the allows concentrates we've leading discussed the that as that and see think business we hemodialysis $XXX to that. to fact spoken want building our is path we And We've in plus become primary us goal we we become supplier also So, million path

markets do will provide where currently again, we us further so, include growth tapping today. not products into international And for

And will now we ability the outside think I our agreement, time products that's And of third new being that, the to from. so, additional where growth come for have then contemplate portfolio. adding to first Baxter to the the

manufacturing take renal we grow are add out advantage a that care capabilities of capacity so, as our to expertise, And distribution well to and as portfolio. evaluating products additional our larger actively

this on some to are beyond sort say So, stand the I where we we of that growing would of those focused business, are today. that areas well

on very and all you progress. congratulations Thank Great. the much

Brandon. Thanks,

questions. to the over call are further there back Dr. And I no Strobeck. now turn will

Thank of to call. on was pleasure you, us joining an thank for XXXX. today's our It accomplishments operator, and overview provide with everyone a you you in

manufacturing We on profitability, are focused and and position, to improving the maximizing steadfast and driving of overall capabilities. our our our business value financial revenue, unlocking distribution

position patients, better Rockwell major drive medical putting world. are a our more centers so growth serve in and Medical and can performance around further we clinics, We to the improve

impact the in this progress our products is take very forward to calls. look future business we that are our responsibility patient's and seriously. to This make We the passion on We life. sharing

This conference concludes today's and webcast. call

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