Sientra (SIENQ) 11 Nov 222022 Q3 Earnings call transcript

Welcome to the Sientra's Earnings Conference Call. My name is Hilda and I will be your operator for today. At this time, all participants are in listen only mode. Later we will conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference is being recorded. the to turn now will call Mr. over I Bennett. Oliver Mr. Bennett, you begin. may

join Menezes, that yet record-breaking growth, only Sientra why and Vice call QX and XXXX had growth Ron reported positioned record Officer; Chief Lisa welcome President Chief a afternoon, Senior Senior also at report another our Sales Schmidt, Has company third you but quarter vision the Officer; today, XX% we President We're us Andy one of not Executive equals regulatory. to have Sientra Rosas, our leading Good we Dajles, Financial to today On quarterly and revenues quarter, R&D and this representing for quarter as the of market Marketing, into provide President beyond. Sientra's today Denise and highest could of is ever. call. XXXX $XX.X earnings and we believe excited million, Vice revenue for Sientra's Sientra's year-over-year Sientra of earlier conference is continue performances which and

free and you forward-looking United outflow our statements, any I expectations remarks revenues forward-looking only that of of have of compromising our and line and low for we our have ask. focus growth. bottom events assumptions States on both proud reported statements of breast quarter did the These without of including is also our this may discipline fat remarks the trends. $X.X management's a but paying to call as our businesses. later detail record revenue not only it everyone extremely prepared current today, the in cash in lowest the year, results are quarter. in for also to the remind based will be future continued Andy We record And will at Not in response our top-line a third are when we on questions time quarter report reported comes declines XXXX, seasonally we competitors million the but achievement,

Our actual statement. undertakes update no may or in estimate implied forward-looking or statements. from to materially expressed or differ results by review projection The forward-looking the any company obligation those

the into I you For SEC XX-K his and comments and discussion ask and reminder, beyond. I would like including risks XX-Q quarter the and With heading to you provide company company's where refer XXXX our Ron uncertainties, filings, to he company's that the of more form sees our available now on would detailed to website. form on with the

of strategy products strategy bottom leading XXXX. demand is will I'll the programs. stage and drives tier sets the augmentation, ample see this In we reconstruction. both market market. line, by QX, even versus in focused X% the reporting This results continue the an average revenue are micro ever. innovative safety top outperform the by quarter backed of Oliver on quarter, in The our grew profile demonstrate we're of validate Sientra's surges and opportunities top and augmentation slowest unrivaled on for Sientra's perfectly to strong our best in-spite economic the headwinds, quarters industry

we addition, period. the In accounts time XXX during added same new

penetration. seen reconstruction, market have Now looking we at accelerated

XXXX. hospital this compared above grew quarter, to quarter accounts Now by top-tier XX% third

We also added XXX quarter. more accounts this past

this overall to past continue Now up encouraging. They quarter given sit seen will quarter. extremely into what is fourth I've market from momentum

novel January. preparing transfer launch fat to product our viability now enhanced are We in

grow well and to This introduce Denise. new to minutes take competitors, highlight requirements. continue share from almost funding I'll reconstruction from a market a a infrastructure more ask to to excessive of our benefits grow take from worked You're in and lines business to the this launch deep without from for we away from and interim ready few as position to The have U.S. current Lisa market both Lisa and going how getting our products we're decade. augmentation hear how which we product on

we in augmentation both we upside knowing increased segments. reconstruction, penetration grow both As Sientra have considerable the our and brands, continue we've in to

patients proven learning our recently earlier with XX also which We months. market based enabled macroeconomic of strong to be forward validated continue remains serving strong, strategies augmentation continue group remains of to reconstruction to we The over time. that that And us conditions. measured are XX% year. them, strategies that The on the surgery other resilient has and planning by dynamics in to evolve segment stable, a category and has the place next demand with this in potential

We accounts. outperform of expand to that footprint can market we the continuing our also know by

anecdotal strong have among the are traditional both surgeons. process we evidence and patients decision-making disrupting that We affirms

We a from safety bringing well clinical crucial term implant, expediting continue our by safety long-term, our Health our approval global backed From for data, received strength, of market the as well selective has data, innovative as kept as proven for with global our Canada for bodies. approval meaningful also our patients, beginning, solid share, our is technologies been by approvals. Sientra's in physician us position increasing which fueled strength long a newest differentiated to and Arabia. advantages, low-tech Saudi in the Sientra as grow we And has presence We portfolio and portfolio. received profile of profile. implants in breast regulatory

hands, which providing at realizing the surgical True technology, will better patients team now truly driven transfer and New surgeon, will while we shared that but is unique in we we Dr. to Conference our overarching York them Beauty women the unrivaled space. efficiencies, journey putting all Denise growth plastic commercialize success by that very Dajles both is confident entire safety for trend City. and next that believe the something unveiled the profile recognizing Science preparing in to growth be doing to how of month changing will high the are our team goals is corporate and Our continue board-certified with commercial we game share the I'm are an a can of linked make our products dedication fat best which profitability. the in

predictable launch With novel we enrolling sites a to patients. body this fat am was study body breast provides in a least needs our by transfer surgeons share line other outcomes. enabling XX% This time that and year, the benefits the significant in I will unmet to more and be unique natural, very transformation. products reliable progress become surgery safe, happy obtain clinical system, full company that and us diversified offer of to leader made space will total we've aid, for and that transplant of actively fat at our the over XX expand in address the much

mark, impressed surgeons are with reach the the obtaining retention our viability enhanced they patients follow high six consistently As system. up fat with are month transplant

with for have cases areas our beyond We and breast, fat the surgeons been system burns. using other in even transfer for treating facial performing also

time Our the system data early and experiences validated so clinical that the in enhance invested decision valued this is to to acquire improve strategically AuraGen. functionality the We category.

received this We that are well confident will the market. in product be

the over outlook. to Now discuss Andy to I'll turn it financial

reconstruction, successes months demonstrating augmentation our financial quarter, XX.X record performance sectors performance of Highlighting all strong and from reiterate our international. revenue I'll this

performance. free non-GAAP cash Another and flow key highlights financial EBITDA was our

million free cash up to this flow Our our lowest $X.X or was QX'XX non-GAAP performance. year. was impressive EBITDA loss More

million channel the to of an to $XX.X was driver lower which based sectors. includes continued for The record to benefited million million marketing compares million QX, cash compared cash mix. of initiatives increase in flow million million transfer sales of and Our is QX'XX and use GAAP the for XXXX to XX% period XX%. compared businesses, $XX cash key is which for for XX%. the numbers, compares QX'XX operating same to was margin burn investment The cash products. operating international expense in and and million or for $XX.X or reconstruction by to the Diving revenue expenses margins from by was into for support fat of $X.X a low launch favorably Total current Non-GAAP increase last R&D QX'XX, the 'XX prepares of QX,'XX, $X.X margins for a was $XX.X increase augmentation million QX, the which gross company. $XX.X QX,'XX trades in imminent $XX.X $XX.X million for 'XX. the Year-to-date QX;'XX. gross margin balanced free gross our an expansion The products year. XX.X%, the

in $XX.X $XX.X and Our comparing or current expense favorable $XX.X QX 'XX. operating 'XX continues QX expense trade non-GAAP year, of million million this trends in to

of non-GAAP expense operating current million $XX XX annualized million million to $XX low run-rate non-GAAP a is guidance. Our

$XX.X investment product Switching of million was liability significant partially commercial compares for 'XX $XX.X value operating expense again of to million attributed million. sheets. million includes support continuing year GAAP non-GAAP 'XX. forward activities compared performance The expect 'XX QX, GAAP adjustments, XXXX, to million, expense Year-to-date in in loss improvement including the previous year to to $XX.X 'XX from correct 'XX of derivative operating $XX.X $XX.X $XX.X infrastructure, key but Total for a compares million as see continued expenses launches. to period million to it's previous to positive operations profit of adjustment new as $XX and leverage for of to Looking year-to-date operating we your realize efficiencies non-GAAP in we fair period. several balance

our after September subsequent XX, the balance period Our such. XX-Q we as several In events big in events sheet. took shore or initiatives occurred XXXX news October, documented that our up to and

date new beyond; we expense important to and disclosed, the lowering maturity our goals. million. debt debt total to facility three, achieved $XX of One, reducing our into that Deerfield a our debt overall extending previously interest several XXXX As and two, entered with

company. the completed million cash QX secondary launch technology been to quarter transport sufficient busy fantastic year. provided on executing balance of strength early next and also and Sientra. flexibility commercial in of resulted this We our our additional growth $XX has plans, equity sheet fat believe which for offering, including continue with approximately for us the We

record a this imminent to the our slow transfer point, sharp Our of results, will the points, operator. financial back and I'll call balance turn the great XX for QX sets are fat XXXX. inflection that novel our That sheet launch strong At into products QX stage

Thank you.

Alex question-and-answer We question a Novak. will Please now We go ahead. begin [Operator the Instructions] have from session.

and then was weeks everyone. are confirm last the you afternoon, start around actually a the given slingshot there, next just in couple this year. Andy, that financials I of year Good to to to guidance wanted just back million the then your reiterating fat you Greg. are grafting thinking was in got I point, in next Obviously, solution Recon about the for growth year? have $XX you've year the you've side, on $XX to about And next XXXX. focus are you the year? how got more thinking the million full launching, just how hoping

Sure.

we we that that in coming guidance So the at efficiencies thanks that our question. lower We're guidance. we're million. that into million looking $XX very certainly the previously, confident of year, read we -- for good our we we're terms ability so to far. also continued But lower guidance annual had at Yeah, end cost expense out are have bullish numbers of expect had cost of -- our Again, performance changing to We're into guidance in continued range. continue QX. yet. from And not this in we we're very don't guidance in $XX terms the performance XXXX, good we with

she and expect XXXX. what fat contributor, a weeks. essentially have from to be In grafting Lisa's mentioned reveal, and financially of prepared going now my market to and whatnot, going is very and we a number Obviously the remarks, in that big we're to terms see had perspective, of

very it's to So right expect we shipping And a top for time exciting be on in of QX. us.

big to modeling And a better other of terms in the So that's that's keep answer here And be those multiple But plus. is going keep count waterfall. going a perspective, like year We that's from the have experts contracts. build phone market accounts questions. building adding then continue adding we keep to recon on to those activities, to and adding their and a accounts.

expanders. the a FDA what helpful. extremely on around that's your tissue just And then AdCom here, is maybe Okay, multi-part take

the Just a out that what come also is meeting for the means readouts it at sometime the expected next for solution next read the thought tissue clinical fat that for what's out there, pipeline, second, existing to is month, this process trial out Pro? the AlloXX conference grafting or year? expander And of out but coming then

regulatory a thanks, those have answer things, I'll has Yeah, Alex. She Denise questions. Denise?

fat course, we under to them we with moment Pro, this Thank current to to BTS market regards public not a in no regards make tissue is you, a submit Alex. ruling to continue will at active of or through will ruling do. selected, on with has foresee active the the after the still which final Conference regards three from FDA. now opportunity it's of With review give and products transfer expanders review And currently Hi, have would a do And some to classification two have again, class the ready class their been it's the during the three Even study, December, process. study give consultation, period if products a our an perspective. be marketed. the And Ron. decision the to With has FDA with conversations of the class And we impact from FDA. made have investigators the classification regards still on a clinical PMA to we

launch early we We when expect first results product the year. to next release

Thank the Appreciate you. great. update. That's

you. Thank

Our go from comes Please Kyle question next Rose. ahead.

for is Hey, on this Caitlin Kyle.

questions the technology, quarter just you the last GPOs couple more fat can conversations you on product? you on a had Just about mentioned with that elaborate

of we already. to about already the with discussions, Yeah, process, are GPOs and added bidding to some tell It's with them when bundling to GPOs. of part of be too of approaching process as early that timeline some a the

that aug, know Got into road activity it. you QX you about of quarter. quarter. down XX% a drop on of last the your just Aug on weakness noted was the And the in then Did in call I that accounts continue QX? in of middle kind kind the mentioned

strong continually you're and kind into were this QX. QX accounts kind you seen of A&B dynamic are similar of While into

a augmentation market. performing just we're on bit So then little And that. let of give me color the how against

profile but a shown consistently terms that So have in product of the market. function And been slowdown, has superior programs. innovative really we market, of our the our both a augmentation there it's we and outgrow

is double future levels. so in continue we traditional matter market, the what And than no But does, grew versus XX% revenue still last grow. better for we the digits, and which which to significantly QX year, aug fact, is market the below have

be a but what So a and last measure do -- group and a busy which We continue our over years that market we we've ebbs market high and perform performance level. performed business. our our three of account flows, seen Ron doctors group being a that at durable top this tripling about share, of an know of part very mentioned earlier, to is the is in important

And will share it. great. a terms quick then Any one. Got data market share just be you in could of recon Aug

Yeah.

What mid-teens high-teens. So through our well. through ending market we share the in of performing to and the at reconstruction would anticipate is augmentation year, is with QX continue still in the looking the growing, end progress year very the

so thanks much. Awesome,

Thank you.

Our next Vendetti. Please comes question go from ahead. Anthony

Thanks Jeremy is on line for for Hi, question. taking Anthony. this the my

recon? on that you Aug What strictly in XXX Just accounts. accounts just total number of know between does the and this quarter. I bring overall added about your

dollar accounts, XX% Aug and and recon. It's X,XXX still little over a account. XX% We're about

over a a that's -- little said little X,XXX? you So

correct. that's Yeah,

that was same I same of amount at know the that the I mean, last end does quarter. the think had approximately you So

you assume rate? So do that more site what just leaving maybe took on we are leaving? the have any And they're those attrition should why that accounts some statistics think you a information little do

a leave, accounts for know don't accounts some quarter. order We some

leaving has left if adding accounts we less market the past much the slow accounts, and the of many market. existing have of impact the this competitor. less then new has opposite been and because us a good we impact someone thing for account why by continue the accounts And expand we of add They ordered So a looking quarter continue really to for with minimize because at accounts. is don't The things have what new we're been a quarter, orders that have share that's accounts to may is great some slow quarter. or it

understood. Okay,

you how that's, because to There's factors. macroeconomic finished? to the have be that's I about patients to saying you're they're then to the XXX can so study. mentioned those go competitors when to be we far? expect many the And to So leaving been you do jump Understood, And have know, also. enrolled helpful, not of just fat leaving enrollment going

want do Denise, jump on you to one? in this

the the study. rest transfer to The enrollment fat of

of projections, on So sites. XX track are progress, to over share we we significant data have are have we to will our launch. we all making we when And vast six-month

So expected. as right but now on is site, is the track enrollment depends by study

So what that? was missed that I

the since we of is enrollment as the that year. So expected beginning

have by of full in maybe launch like Okay. can the 'XX just system more year what information, for and commercial question, you I And share you? looks you then end any you could then last years fat to the maybe also soft this a launch know, that

I'll one. Yeah, take that

So our is fat unique. transfer very product

mentioned, and you to from It know, typical had us the it's differentiate novel. in the approach deficiencies leverage As opportunity gives market team the fat grafting. our

in then that is weekend early And retention sold that be to planning launch of of with directly one is a soft commercial So after full York and first we're sales to January surgeons things December a working group go we've QX and our results. in to launch identified customers. opportunity to in what New the the our consistent force long-term in City the is a on Denise

with planning we're launch, among disciplined this our a new approach to So and with building customer approach core customers. and And both momentum adoption base

positive. about excited feedback very So users we're from the very clinical the early it, has been

in the just getting a few we're to launch all weeks. So pieces of together

Okay, sounds great.

-- quick last a just So

I the on part would they've expectation really it's surgeons the that high. are who just what plastic heard peers their of based from the going to amongst really, comment study,

great. It's

implants it plans been technology any that there for to haven't or thought the is up, about yet? follow quick the a maybe breast grafting customers really as fat and with Just bundles

number expand Sientra is this the there us of underneath opportunity and benefits And technology total to umbrella them, that absolutely. are the product it gives portfolio. a one of with Yes, the that

do right to to and customers. gate. out in our of the continue of organization, high our subject we So the level customer area, do that matter a the new there's growing place opportunity expertise breast in plans existing strategic base fit have Obviously, within within

do standpoint. But So, approach yes, directly, answer your are total have question of numerous. a to adjacencies portfolio we plans it the from kind to

Okay, thank the queue. you much. back hop in so I'll

you. Thank

next Our Block. ahead. from question Please comes Jonathan go

fat try the I'll Good product. first Thanks, afternoon. about transfer down go guys. the their question. excited very Maybe road. just Certainly to

specific, contribution that year And me Let we a thinking the ran one more be profile gross margin should about as there XXXX? that revenue is it throughout about? what be product of

Sure.

we least As like at expected we with tissue attach I year have at exiting fat it at commented, is grafting to type to that before, X% start and we it's the dose. have to fat revenue. expect year of The revenue look representing transfer way the expander rate the XX% of

XX% revenue, already a transfer, great and we to to We've perform Our fat be having the how number reveal the manufacturing. ramp. the already customers, here at we of way got news, the fast tissue same the going it's up expanders same Other are base. embedded customer weeks, can we're looking it of

we it's manufacturing we of to the And material sold, control cost So issues. north going questions since any product. ourselves, we're we're are in good that to margin goods complete have go XX% be don't of on or of

of revenue to next both in very it's additive year. margins so terms gross And and be going

you helpful. gross maybe very margins. the mentioned Great, then And Thanks.

corner key and more right. a it anything and Maybe change turning margins time. didn't hear I it. gross that the and like from are in Let going back the XX But a XX normalized and me of GM sort XH, seems And cash on for that. step determinant eventually on quarter missed flow on the yeah, follow one I change really I think up be to and

You get our thin can back. only so on

can help guys. three forward. looks gross with that time, back 'XX. So to more going your Thanks step how you importantly, like us And to margins, why and for maybe trajectory

it's very And right we're way cash had again, bit our which current it's little and actually more of But the out good Sure, on performance margin international, international, is to gross profile. benchmark. XX% model, we fantastic going we'd like of use a different now some and quarter-over-quarter a to margin. good wired distributor so contribution it's quarter, change about a

that market some came what come very to targeted, part So that's if And that of programs factor in that it play that allows We is that into targeted we're feel fantastic loyalty play into our QX. it came use, But of. very does Other on is we have tight, are also base is based, We you're depending does don't us period possibly into marketing are we're that one QX, does share that see gain pulse play. is factor programs to darn actually we in. our it price pricing touch do basic but not very proud compression, programs loyalty protected. pricing. what pretty which again choose

you. we fromMargaret a Kaczor. question go have Thank Please ahead. And

Margaret for for Hey, to on our taking the quarter. everyone. for first start maybe is wanted Thanks This Maggie Boeye today. on reconstruction questions. I

the talked guys about You tier seeing that top your growth you're in accounts.

the overall you to gain continues if could just continue Thanks. that parse out maybe growth see business and to share, seeing just acceleration. as you you're So

Lisa. Hi, It's

help So the our been make really we've very are market year-over-year. to able to is stable it recon easier. product market, the and inroads digits It's due make woman's where that double advantages, journey designed to strong a up

moving that So the anticipate we to double the we as digits, that end for seen ending gains. forward, as high-teens, mentioned share XXs our market continue And XXXX. a in grow the then share, moving doubling the as two into well and did moving past We've market over us, earlier, in trend of forward. we also see about I 'XX, years in

Andy you expectations. operating And Got just one it thanks expense, I so if maybe ask could on for much. then

think what to technology, as and up the expect as of we kind and as launch XXXX we Thank of QX guys for grafting should are gearing in there? it enter limited then you we about you. Just fat

Sure.

on where it's this into by means. based muscle trend of we not any year our op want in been again, efficiencies, expense a So to great terms cutting it's it, getting

guidance, a into we go a we continue in into 'XX, higher we expect quarter are future. we be to will going expense in be to lot number we our that get launch. guidance right we do now. different the drop. is to however, in cash of efficiencies that's expectations trending $XX or play When based part we know, terms But low per of grafting here We than as little give bit that end then of QX that than the and the to year. just have saw you a, low are we're going our at that We're And to see come launch, It's at out that will op probably today. the because run-rate less than a fat actually where lower to what XX.X-XX.X of procedure, this is going the of our little lower A million year. come next

working XXXX rising going do performance. leverage great we're really and on expect So what cost, cash in lower see very that to with to number revenues, But is some we good be.

all. you Thank Great.

this you. Thank final remarks. to no at turn we have And like any the for I back our call would moment, presenters to other questions.

everyone No, and day. a thank operator. finish lunch technology Thanks a at good forward Thanks, start with everyone. a call. on Have the and great you, Look joining next year. XXXX for great us new to

We conference. concludes gentlemen, you. and Thank you. Ladies today's this thank