Milestone Scientific (MLSS) 15 Aug 232023 Q2 Earnings call transcript

Greetings, and welcome to the Milestone Scientific Second Quarter 2023 Financial Results and Business Update Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] Please note this conference is being recorded.

I will now turn the conference over to your host, Mr. David Waldman, Investor Relations. begin. may you David,

thank results joining conference and quarter Scientific's XXXX financial call. you morning, Milestone for second Good

On the Officer call containing also Chief Company Executive posted with a second us today and issued company's results, Milligan, are quarter Peter on XXXX Chief which release the Financial press of financial Scientific. Officer; Milestone today Arjan is Haverhals, website.

after please any additional XXX-XXXX the company, contact If Communications like you information would have the call, any (XXX) Crescendo questions at about

prepared remarks for provide the company's financial ended results now The management operational reviewing the June and will XX, quarter second XXXX.

would Before expected we regarding get to revenues and Milestone's ability that started, we of forward-looking impact we during call, this future statements success may to financial make like conference implement plan, everyone business and timing the remind its

involve business and competitive which future all to Milestone's are number uncertainties with involving are which future statements economic, are control. assumptions and or a to risks beyond and and decisions, judgments conditions of predict on based accurately impossible many respect of difficult of and market These

quarter limitation, XX, Commission, ended Milestone's without for to Milestone's year second operating revenue rulings, ended periodic in differ XXXX, in changes important competitive customer including, and from report conditions, Some filings to actual failure results XX-K requirements general time by from achieve and Securities XXXX. changes Form statements those could FDA standards, indicated report to or expected cause time legal factors the the factors the our economic patent and risk June that XX-Q XX, in and Exchange forward-looking of expenses, pressures, materially adverse detailed are the on the growth, December with on developments, the Milestone's and Form market

forward-looking XX, are Milestone any statements based forward-looking or upon for August no as belief management's any this of update undertakes obligation today's publicly date, statements revise reason. call reasonable to XXXX. during The made

ahead, go Haverhals, to we'll Please Executive With Chief call Officer. Arjan. the now over turn Arjan that,

Thank everyone for joining to today. you, David, us and thanks

quarter first report over solid an profit same last of of sales. we XXX% over to second XX% of XXXX, year-over-year domestic achieved XX% for same saw at the sales period pleased international revenue time, increase increased same I'm both that increased year. Sequentially, $X.X year. million and And XXXX. gross period the over quarter the increases our last of We in the the

U.S. only supporting and shipping job a gross revenue to increase the our The handpieces system margin relationship online DSOs, do cutting the has has due single-tooth these allowed but to much and anesthesia organizations, service clinics new dentists. and dental to our part a Establishing directly and in success within and clients by the in was us not portal in selling or out for of better STA, with prior direct selling dental improved our margins distributor to

Since portal now thus purchase existing the the to able us handpieces in the reactivating growing customers track upselling and of of know of acquiring through customer to our in activities their sales really customers the the terms base and We U.S. launch customer and we beginning been pattern execution enabling improve data of sales the the and analysis. in instrument new conduct and have this identity sales the year, these

engaged specifically. we've the in marketing, At same time, direct-to-consumer targeting patients more

interest about We STA helped to asking from the that dentists their have dentists. has more inbound the seen us patients drive

markets. existing in quarter saw during are strong sales a our penetration the markets as increase within new dental international international we international and deepening we addition, entering In second

our also continues noting It's it profitably. offer worth Dental to division that

basis, the which than is last fact, on threefold of In Dental income $XXX,XXX over more increase year. the division operating generated period standalone same approximately a a

a continue to standalone business, higher basis. gross flow So on margins, benefiting we're Dental solid increased, revenues to we our from our and summarize, cash within generate

to we recurring the on to nature disposables. revenues, our high and expect grow from margins As of our as economies continue as well benefit we scale

segment. to Turning Medical our

our are Epidural the we of advancing who commercial motor achievement good We reimbursement payments making System the System. payers Most around just announced CompuFlo notably, use vehicle commercial These progress from for the involved are efforts a the for Epidural patients accidents. for were last in week, CompuFlo significant company.

payments is to all for strategy. we more good can validation are time-consuming that and making are Nevertheless, and I reimbursement like a would our clear of technology medical progress, standard devices. be be new process these than reimbursement further which

of would for expand to of support from their continue then of which technology which appropriate the insurance adoption foundation level reimbursement providers the utilization in the utilizing practices. the stimulate physicians is building We our technology, and

reported the Towards injection physician. steroid Fabian Proano, epidural an thoracic of medicine into Pain Torrance, Rehabilitation The pain in the of XXX% interventional he data CompuFlo founder, using included by Dr. Adoption the conducted and this procedures sales thoracic follows this evaluation System its evaluation commenced a Proano which cases of CompuFlo in Group end, process successful and lumbar, Dr. cervical the Disposables Medical clinic success. Epidural spine. technology by junction Epidural California. initially the we within

our more and Proano established the such System goal technology Epidural as as care within anesthesiologists and as our physicians reimbursement, of performed is to broad Dr. industry. for secure submit coverage CompuFlo well the more procedures As and standard for as

within is our a Epidural CompuFlo and there contribute federal increased market agencies can opportunity system We Instrument efficiencies. for government our other to believe as also

front, our partners. are network of international distribution the we expanding On

additional as within to are commercial proven rollout. targeting our international relationships distributors look key their and advance medical existing we records, global Specifically, track markets introducing with we forward within We distributors devices independent announcing territories.

go to point, turn like over the financials detail. Milligan, in to Chief to Peter over the this call Financial I'd Officer, At

Arjan. Thank you,

Gross was $X.X $XXX,XXX. of $X.X ended three sales of the of last in months in international second an and for quarter new increase Revenue second portal. increase for domestic or The to by sales online XX, higher profit increase versus of driven an dental due respectively, with the from was XXXX quarter was the launch year. $XXX,XXX, the sales of for approximately XXXX revenue $XXX,XXX June million, of revenue $X.X revenue or gross and of million the XX% margin XX% and million in dental dental China profit $XXX,XXX

Operating million $X.X the ended increase the XX, revenue gross months for last $X.X million $X.XX general versus the XXXX. in the offset and reduction for share partially and comparable expenses. increases XX, three loss share for approximately $X.X versus was million $X.XX loss a some quarter second three administrative $X.X months of a the or by ended temporary for period XXXX, the reflects June loss in was or selling, million June XXXX, The in year. in margin, Net

million. June the As were million cash cash, securities of of company approximately XX, $X.X capital XXXX, had short-term equivalents working approximately $X.X and and

turn this At to Arjan. back the I'll over point, call

Thank Peter. you,

STA We enhanced sales well new around marketing we as quarter. efforts efficient margin the in as sales as a during U.S. an been have believe high-margin, years. recurrent the strategy, to and illustrated handpiece launch drive including of platform developed and improvement our the growth believe by coming solid our We new effective, in our portal have the help online revenue scalable

should segment expand to until the a not and also fund on steady domestic sales to help also stream We business becomes fronts. our cash the Dental provide standalone but The international that continue our growth, our initiatives Medical in that will of a within revenue flow only self-sustaining both contribute basis. to continue dental

forward payers Medical regarding international an our well pain to business we look important prominent marks reimbursement be last segment, our importantly, add commercial we Within continue as and upon. management partners. But from as physicians week most to clinics building point expand the news inflection for distribution our that

We system are which to sizable initiatives and also federal would potential market. approval approval, up following open leading government the advancing SAM up supply

market. we look opportunities both and our are we driving to We and we providing unfold. and value. advantage in to interest updates witnessing of up, take streamline we operating growing in dental well continue medical remain available are as At committed the the wrap time, to further forward our instruments, same to shareholder structure positioned to believe developments the So

to point, we the questions. up would joining like And to like the today. call thank Operator? you call at I'd for open this to

[Operator your Group. Instructions] Your is Maxim question live. Anthony, the is from first Anthony of Vendetti coming line

wondering the adopters huge as superior System market I pain and some We've It's was and a that's was acting playing as customers? heard the the color pain anything pain in than powerful Arjan, can improved CompuFlo if just is they the side. word on how find out wondering acting out? a because on some obviously pipeline are could improved of opportunity. -- do I give you. the marketing clinics. more these centers precision. how rolling then little early of probably system from docs those the the you just even they Are the of update was just mouth that comfort, on Thank that feedback they're usually using currently those wondering referral physicians sites for any among more you that's or with I and just efforts

very the you for company. major much. absolutely. Thank Like it's Good Anthony. a achievement I morning, said, Yes. No,

using part the also And think of how I been reimbursement feedback what the question is it? they are has on activity.

claim. good received from think resulting except cases been of clinicians. have not these necessary preauthorization for expected. our a able claim has I as clinicians was to amongst insurance received establish technology resubmission Medicare Clinicians private in the of And been utilization nutshell, have the So we in responses providers and denials, where

to providers is than are through a each the addition, about as through amongst on we to to insurance important speak benefits have your that to raised claim not access clinicians, for received. word feedback absolutely, entitled have questions activities of clinical marketing marketing clinicians much in other this use other, more In campaign the To and based we our let the heavy direct technology easier and the point, them evaluation. because each we mouth

ramping of any up. then just costs -- you visits customer been acquisition know of store? Okay. online your going what just site terms that's Great. talk then the are the do you've metrics have that's new to conversion, you in point? this been success And can And that about how at I measure also

them mainly acquisition low activities it's important of six call patterns, because why quarter, customer analyzing first what a is two you it's can we and boxes customers, utilization that to say, by was Well, know the right, low now purchasing very of nutshell been for let's have of in which company more the and saying, do costs months, we utility the telephone the know our, the because order is handpieces? handpieces in the through ordered the time have these have you we available doing we are after or identity data

understand definition ordered they rooms in not the is have education or better customers technology opportunity reordering have. thereby and a in how what is in them a that sales other execution, we doing support to the application the pattern. operatory service the nutshell, the So of the In and slow helping now technology many increased really are We instruments calling call these for past customer provide utilization customers upselling to and customers, upon words, patients. driving per the into aftersales of have

opportunity. in it's opportunity that to is, people important the the have And to think, I been customers. an So to us to is out - been reach the a unique what actively because more give business. the factor and doing That that internally Dental would has revenues proactively solid know continue mobilizing we -

there are like picking still are international? - need the you're any know need distributors? I you distributors. new you feel you Or you covering to you mentioned internationally, now you you signed signed then do and Have cover territories sales feel new in where countries some ones, And new Right. but up,

particular, of would in where a No, I in, handful Latin countries in to like America. there's still be

well in focusing international activities but we I Dental primarily on are making distributors, think the better covered for are business, existing markets the the distributors.

by to of meeting international prior compared have markets regular increased due us, meetings in these U.K., the President a existing very growth for Sales, of is major to also the the major only activities these myself, in the Senior the where markets these growth a I'm a countries, quarter seen markets ordering to in distributors pattern years Poland, double-digit we important related increase distributors few. meeting in Germany, year. every heavily taking but Vice as So Scandinavia, minimum our distributors to Not mention also of

queue. I in Okay. last back the before question Great. And then hop

to at? Medical terms need point, number that? that in the Just feel add segment, sales the do like this what's you there, force you And at to of

the surgical We ambulatory activities United our being reason do three And that. currently have procedures feel pain and to on that centers. the with is of increasing on about add medical on CTI primarily states done, the adding additional not have covered in covering currently States. is I volume The also the in continuously XX I the that focus main clinicians of focusing people. course, we distributor

any on plans expand currently, So not I force. further to have do the sales

Thank hop queue. the you Okay. much. I'll in back very

much. Thank you very

Your question Brennan, is next a Robert is Private who coming from Investor.

Good morning, Arjan.

morning, Good Rob.

a Arjan. on morning, really confident, sound obviously to How're Congratulations hear. really good always And you? Good which quarter. good is you

So an the market I of my opinion billion. a on you question addressable I side, $X anyway. online shifting lot you're also the my And going obviously, looking to to portal terms stability, dental guess, applaud business in of your shifting you in model more give at is which is on about

rapidly, I to of be considering because with you standard your considering actively but strategic engaging think anticipate do market to more the size most become the a gain partners - So size of of traction force, potential you people the are sales care? going

partnership always potential activities these because size Strategic entertaining company up our and the open on the is that's and of something screen definitely for the radar discussions. might Yes. the

However, in I because other the importance companies. is reimbursement interest extreme also success a will potential think that trigger of that we it establish of

clinicians of other fact, had in in our discussions attended centers, companies. but most only I the Society important entertain opportunity Pain and pain As a to have also approached by we Florida, of making that to meetings and are anesthesiologists matter of technology known the one not

week forward and technology the company. because importantly, very that reason moving we get the so about and the last we segment, I'm first that that's do But the of validation today achievement and we and to reimbursement say, - pleased are for to personally encouraging have had our we most announced why to more than that evidence is homework our have talking encouraging that that the step an within

agree No, with that. I

the to -- hopefully, the time hole break. that's it's going think down allow I the in it's to

has -- there is response that you're any terms the from information as last So at job part reimbursement doing? any been But have of only ongoing Or management realize clinics? released in it's pain the early all week. just post-positive I and days, you been there other of this

No.

all, very So of Anthony feedback the of - like the first answered like The earlier, are said, with of right? I utilization. happy I question we

And We for those preauthorization have have like XX have denials that currently said, submitted cases the clinicians are insurance done necessary. I received more than not been where actually was health any except to providers. cases

resubmit what claim. the do they So is they then

then the insurance clinicians addition, a of benefits questions the don't that And the for providers clinical They've and through in about that. we get get the number The evaluation. clinicians, technology feedback raised directly. claim

an process. that So is ongoing

important is be for course, an first Now technology going patients, nevertheless, that important gives to procedures. patients the state. that's them accident triggering of motor have important, clinicians activity And when and these that even very the for to state to reimbursement a vehicle effect. It's from we the definitely the treat provide those what opportunity to received very is

Well, again, great quarter.

bringing continuing to the that point the it's are medical just you I market. guys to promise think to

done hope. well continued and So good

Rob. you, Thank

very much. coming next Advisors. is from Instructions] Andersen you from is All Tucker, [Operator your Above question Thank Tucker live. line Our

Arjan. morning, Good

morning, Good Tucker.

my Congratulations. questions. and congratulations, progress. a of I thanks questions. is taking have This for add real couple I our

progress new how been adopters. direction? I to in only better First, to And to might enough has store the adopters to utilization the area, of of new you've that the contact having open the time the if equipment there direct existing but in get not perhaps getting new dental operating online owners and in alluded that if figure wondering best your you was fact had methodology out by any you

That's I customer is, process. this I'm with acquisition. normally process on the call, of one that And and absolutely adopters goal and new have pleased you the part. course, look instruments new been new earlier the to if also instruments on Henry and Schein Tucker. that customer Actually, acquisitions There explained would in what outperform new at of development our do

we The not instruments unique one opportunity a increase to upselling the practice. should of there that second is part, number forget in

that Yes. that, been surprising of business. adoption, point business, that seems not because hasn't given has to out, you in other your Well, me, profit only fund that's the to a real your area but me congratulations greater on to profile opportunity there been it that it as

of for On of the question like sort things, something doctor the for of you reimbursement a deeper. state procedures to is automobiles, getting it's than reimbursement regard it successful, that been usage alluded whether to delve and you've you're easy get prior more a medical more procedure? Or authorization strictly into a couple and a of I'd them love that part for question to that to law? but are those Is that therefore, with standard emergency little

issue, - would available which an It's definitely say. for for our I injection. is claim not insurance have been the that or our we have epidural doctor an our if code not when to reimbursement procedure to did steroid XXX able and T called would code, to the technology, But get addition make code in the tracking the

I lot is be example, also accident the question, doing cases your I based think know, is Florida, that of on my significant I've treating dependent state of that in motor that more second these clinicians state. understanding can part it to of than vehicle definitely number the are the for from research a patients. where been

would also those health insurers is insurers these that be primarily standard opposed as the different insurers? - automobile are And to

question. again? understand that I say your Sorry, not did

in be liability, standard the reimbursement be from somebody's if are be motor If I'm like things and also difference. insurer that. this whether then the insurers vehicle an these health under moto is or coming they coming the to and covered that it's personal may effect a some is pays wondering on of from issuers if your wondering claims, from care of more I'm technology likely will up-to-date - about transfer because insurance

are my question on here Yes. I'm already that. as I happy Because the allowed well of because There I'm a right? would comment asked -- if not and without these insurers who into pay because is aware injection that then detail our hypothesis effect, epidural would because to would That's my is - then volume steroid patients, an they That's technology as which a for are tricking, cannot have that working clinics, that specific high you going effect I clinic private is an on, procedures, also become aware call the it, these standard they these in absolutely. and potentially that hypothesis the in they for an well. of pain

Well, Congratulations, thank jam. way Good we luck continued break would because know major and be for to you. all that look we log the a progress.

Tucker. you, good Have a Thank day.

You also.

Thank you much. very

is who's a is next coming line live. Your your [John from Cobb], John, Investor. question Private

you. Thank Arjan. you How're today? morning, Good

John. How're well, doing I'm you?

and I'm it's and thanks. Milestone together piece in trying from is or Good, babies in delivery, epidurals now we're how companies. seem element here. so the validation Not and never I systems, by the evolving hospitals, to head this for imminent kind think you're about going talking my to to on has was on strictly paying ago, insurance very materialize long Milestone process, where all evolved to where and signers and basic some that of clinics be and seem reimbursement with hospital going but as of focusing retrenchment

looking commercial we're clinics? how for to retrenched got basis? we on for specifically, to Are Milestone's the to get time understand delivery working for still but line, just on I'm just working with you you applications this steps baby have might the and it and take what sustained all hospitals? other Or pain to trying long that you system? so for a rollout the going Are still back not

for you your John. Thank question, Okay.

the would of away misunderstanding. like I First take to all,

exiting market and the not are and We segment. delivery hospital labor

these And still University We mentioned is actually, major I are I three hospitals Kentucky. Louisville customers of two calling upon States. continuing or in of UTMB the our the major the to hospitals. in Texas. United within one mentioned And business Medical in

entering continue imperatives call So of pain labor the to also we been several. and has the delivery, upon segment strategic

we importantly, thoracic the junction cycle expand lower even thoracic decision-making than safety in First, constraints and been of are more cervical is terms in indication to of spine. our no benefits financial able more There the where part clear and have of to and the the is systems shorter. our efficacy the

So I important to that's understand. think very

and the fourthly, reimbursement. the Reimbursement, focus And pain hospital. surgical clinics, then the then on private we initially ambulatory centers then

So comes everything together.

the we here. capturing entire focusing are and marketplace So

into look is second is your question procedures. We we and reimbursement, stimulator particular, the question time. efforts do are that Well, crystal look on continuing a only any are we doing. field thing cannot new widening. to spinal there ball. the can Then to i.e., support third what applications? your execute currently in I our team Now strategy, looking we of cord are That's in The my indication with was, how

created question So the back I to further tools you we believe we have in undertaken. plans going personally activities also now baseline the that have that means asked the and the and the the on historically. and place execute

And rollout, Okay. a This market? last that sector? growth my And time quarterly that and along you for government it, the at process extraordinary be the government updates. maybe market would further private - - on do adoption? how catalyst a And long adopt Milestone if is an huge question with far big in is they is, previous how this mentioned

different a get from federal private on not when schedule. supply the that's approval we sector, than I believe an the market, and its segment the the It's own. important government The issue. significant strongly it's of sector dynamics government reimbursement segment do market in because are the very that, on the a that's

they can establish is difference sector to the government, government no the using have you reimbursement the start is it. sector In between and right pricing So private the the the reimbursement, different. and

in on commercial may, and we reimbursement. are dependent sector, the You

And I even sign on sooner they than I hope do.

hope. That's what I

much. you very Okay. Thank

You're welcome, John.

closing end comments. to over much. very now back Q&A hand appear for We any I our session. will have Thank of the reached to the you team management

Well, for thank all you time. your

you activities the and Be that updates. looking are to time. the Thank And provide development safe, forward we I'm today, well, stated continuous Goodbye. for we with your are undertaking. we have great the of a stay and revenues you day. As encouraged

everybody. conclude does This you, Thank today's call. conference

time, disconnect day. your and you a lines this may phone at have participation. for You wonderful your Thank