Merit Medical Systems (MMSI) 30 Apr 242024 Q1 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to MMSI First Quarter 2024 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would like now to turn the conference over to Fred Lampropoulos, Chairman and CEO. Please go ahead.

everyone, XXXX Medical Earnings welcome, of First and Year Fiscal Conference you, to Systems' Merit Quarter Thank Call. our and I today am Legal Joe Officer Officer Secretary. our by call Officer; Wright, Treasurer; Raul Parra, and Brian joined our Chief Chief on Lloyd, Chief Commercial the and Corporate Financial us Brian, taking safe statements, through would you please? harbor the mind

protection Thank statements that forward-looking this presentation you, Fred. contains I laws. would safe like under harbor to securities remind everyone that federal receive

reasonable risks assumptions, forward-looking risks extraordinary these we anticipated. as our upon cause results impacting to realization are Although company well transactions are statements unknown currently actual they based to and of believe subject any or as The materially uncertainties. differ or those could of events these uncertainties from

represent only April views any In representing as not relied statements date. addition, XXXX, XX, views upon forward-looking other today, our any be as should and of of as our

update Please entitled required obligation information as such regarding for any except disclaim important regarding Statement such release Cautionary to specifically refer today's and forward-looking statements presentation to We press statements, in law. the statements. applicable by sections

cause Please results these most to filings could with also to SEC a discussion factors that forward-looking refer differ for statements. from recent of the our actual

prepared financial United generally accepted States. accounting Our in are in principles statements the with accordance which are

period-over-period be for business the However, performance we useful believe certain of of and non-GAAP investors with trends and underlying can ongoing financial information regarding such provide useful measures our operations. operations comparisons

X-K. and presentation of today's refer measures. U.S. and non-GAAP measures sections furnished non-GAAP important our measures measures the comparable this information to measures non-GAAP for release entitled presentation GAAP under regarding the the financial press This SEC to financial also in included most certain A release financial Form to on discussed reconciliation non-GAAP presentation financial call. Please of contains is directly press

that addition in financial not on page presentation these available Readers with today's GAAP. measures should to a titled with the our note of press prepared release similarly of measures turn in Both Please accordance will website. for, now and be back measures financial Fred. comparable companies. Investors our to, reporting as I non-GAAP call calculations the not consider other substitute are may

in-depth And cover let open what key during operating revenue our I brief will call remarks, our who for prepared results will Thank Joe a to financial and review with Then areas agenda my of we results. of will a more the results you, quarterly of start quarter. over will we me our with provide summary the provide Raul, opening during your of Brian. turning start our After an with overview questions. will a financial before call you the progress remarks.

the The basis. on end earnings that first in constant currency stronger the on currency beginning expectations of $XXX.X revenue revenue our delivered range growth in basis constant we we call. the high quarter on year-over-year the outlined with a a our GAAP first reported total million Now quarter, quarter X.X% up of and a up We review quarter results. of first of than fourth was year-over-year X.X% growth

for constant in the X.X% currency the X.X% growth year-over-year. of Specifically, we expected range revenue first to quarter

well expectations as quarter currency constant our driven exceeded from first strong better-than-expected growth modestly in as which was growth organic the products, primarily revenue by the acquired as well. Importantly, contributions

of well. basis basis which points and XX And as results our and the XX%, the profit in respectively, delivered non-GAAP in growth quarter, first year-over-year XXX of points, margin to solid XX% respectively. gross exceeded operating leveraged XX% to respect we EPS, With in end our approximately our revenue which profit and growth of deliver expansion non-GAAP we resulted high the profitability performance expectations

continued deliver confident generation remain start pleased cash profitability a ability with constant XXXX. free strong in growth, execution, currency to in flow stable the fiscal and are year our solid and to We improving team's solid

to update would the to I Joe, a share recent Now brief months. over on before operational several call turning like progress areas in of

pinpoint introductions, XXXX commercial have multiple trauma a introductions, it excision. we This of with breast demonstrates for supports re-excision likelihood XXX(k) associated had Guidance up and a leadership the the solid a new with implantation clearances with First, dimensions more to configurations guidance approach tumor marks announced care surrounding in X new in to healthy targeted and significant to can oncology emotional clearance the as regulatory in start reflector to SCOUT different decrease minimize a tissue, multiple cancer of to including advancement avoid we ongoing This January, in second for System. damage Merit's designed MD precise physical respect location and help Surgical product and FDA -- surgery. system

Micro of procedures offer In balances March, access solution and flexibility closure complementary percutaneous twice it A improve leading is to stiffer competitor. innovative the represents the interventional commercial X% a the compression our than System, micro It that our standard we Advanced announced to Micro-Access Micro The access and and the kink release to the also as System ACE technology resistance portfolio, devices. leading stiffness over introducer. expands

interventional procedures, poroscopy system for to unique customers another tip customers example needed We procedure. and from the based of a positioning Xx this on start developed patient a our addition, outcomes is access, improve care. feedback and visibility partnering design In physician accurate allows market with vascular advance of greater for at our under

our This information knee blood Merit's area Embosphere controlled patient Second, invasive treatment multicenter, to Microspheres procedure the and pain comparing prospective, or GAE the where been XXX symptomatic knee recent the artery than genicular with helping to a has hyper of MOTION impacts minimally globally. more with knee of associated randomized adults the of injections progress selectively using a to GAE osteoarthritis. condition successful we for osteoarthritis, is is in corticosteroid areas in in reduces respect flow trial clinical identified, validation months, amortization that alleviate January, to study vascularity a first that the million announced study. of our in enrollment

across MOTION up New study XXX Brazil, structured The centers designed knee study effectiveness and Embospheres Zealand. North XX months. safety up evaluate The symptomatic for and of with medical osteoarthritis months in patients continued with at enroll Australia follow America, is to the is to to Europe, X primary adults

Finally, team receive complete we study during our for report the efficacy we cleaning period are throughout WAVE safety to Access pleased the with and study, end achieved collection and the progress last clinical endpoint quarter in and Arteriovenous recent the phase, Efficacy data the primary monitoring, pivotal analysis enrolled track to of follow-up a outcomes has PMA premarket expect we quarter. the of The the with data continue XXXX. WRAPSODY the of study completed and for recently and approval to primary months first by in to patient for or be or FDA second file remain position on the completed outcomes

call performance. Now who Joe? let turn me will Joe, with that, first over quarter the to revenue review the

of constant I'll otherwise are in you, revenue on the a beginning first detailed unless both quarter, the reportable and currency rates and in our categories. all review start Thank results presented Note year-over-year our Fred. product primary stated, performance each growth with with approximated basis. of a sales

non-GAAP in to GAAP the We earnings available results related release have our reconciliations included reported item from website. presentation on and our our

X% by growth in growth was driven in First and quarter Cardiovascular segment. segment total X% our our Endoscopy growth revenue

the driver results expectations was this the end Our primary Cardiovascular versus segment constant of revenue of again currency high quarter. better-than-expected the growth

segment in QX. Endoscopy the our our However, expectations sales did end high of exceed as well

of nearly PI peripheral intervention increased or of XX% period. the in representing products Sales total XX%, segment growth the cardiovascular

embolotherapy an constant PI product increased more in increased and of sales of sales our Excluding XX%, and double currency year-over-year. driven category organic low of the growth products acquired contributors drainage delivery on XX% growth. respectively, growth sales to our PI products, represented strong in and by X/X our together radar systems and Organic basis. in than increasing XX% QX, digits sales PI sales was were products total the our localization of And PI total

cardiac this our exceeding quarter, expectations angiography, growth our intervention contributions end sales period. organic in QX. and products the the both in intervention product high strong categories each intervention our balanced in of by access, hemostasis key the and to also increased growth Cardiac CPS and X%, Cardiovascular primarily in product growth segment driven contributors Sales to were EP/CRM from sales of products

which the Sales and growth X% of of By our effort trays. notably year-over-year better more CPS reminder, we X%, the Custom to than of by due in noted was way SKU care expected low Procedural decline single-digit increased of call than products last rationalization the which Solutions, critical year. kit tray products, fueled or QX, earnings in decline in QX in ongoing sales we is in specifically declines sales offset

area to only a work the cardio the the came expectations as into inventory softer We our quarter. our than our Sales efforts fluctuations levels. that be products of were of through and OEM growth decline mid-single-digit our business to trends customers attribute sales in timing demand in order of optimize heading result in

QX, product from our declining customers customers in were OEM flat with demand U.S. to sales year-over-year. OUS

expect to in growth OEM continue solid we Importantly, sales.

in end increased Lastly, Endoscopy which segment our growth high expectations. our sales of X%, the exceeded

see business, single-digit high Endoscopy of segment in in trends XXXX growth year. and growth guidance to this continued normalization assume We continues this are to pleased our our

our basis. to sales a brief Turning performance summary of on geographic a

U.S. on sales, basis on constant Our U.S. an softer increased first basis. a softer-than-expected currency to driven the roughly what by and quarter X% assumed mentioned. customers came guidance primarily had as in previously X.X% sales our in the point X than currency Sales organic constant OEM

International our Despite the in first X-year X% the a growth constant continue the quarter. X-year growth growth basis deliver currency both expect the basis, of modestly by stronger-than-expected in end and growth QX, quarter, primarily range. expected mid-teens customers our expectations organic XXXX than a growth year-over-year accelerated than XXX exceeding growth our to increased to softer basis U.S. in the assumed driven X.X% at high guidance APAC. was midpoint trends of we constant an The and U.S. to currency by outside in and X.X% on sales points on more the organic

in specifically, year-over-year respect softer With China period. XX% a comp sales year to prior increased the against

X% APAC EMEA region. related we decline continued on grow total to partially growth growth our continues see messaging, our variability We way quarter-to-quarter high X.X% APAC in the due where in growth sales tenders to but year-over-year to midpoint offset the guidance purchasing. currency headwinds ROW single-digit expect total providing to continue as our China, of country-specific related entirely assume basis, trends expected. in units while to decline in is revenue year-over-year increased sales By purchasing a by regions, to growth and by of a in year-on-year, assumptions The driven constant related volume-based decline reminder, range guidance international we are XXXX we expect not to to volume-based of

me Raul, XX. that, to the financial you review of sheet a financial and through With turn call first will let of detailed balance over our condition take quarter who March results, as

review you, our Thank of performance. a P&L with Joe. Beginning

otherwise the year avoidance non-GAAP my the of will results the unless For noted, focus first doubt, commentary XXXX. company's quarter of fiscal during on

related reconciliations the release our our presentation We to GAAP our non-GAAP results from items website. have in on included reported available press and

profit XX% the approximately quarter. Gross increased year-over-year in first

margin the margin basis up by XX prior The was variances points improvements mix, period. manufacturing driven year-over-year was revenue gross by offset favorable compared XX.X%, Our partially and to distribution gross uplift and in freight costs, year-over-year. year increase pricing in

a the first expense and was X% by the year driven R&D increase prior operating period. a The increased XXXX. to X% expenses X% of in from compared year-over-year in increase increase SG&A expenses in Operating expense quarter

Total $X.X or XXXX million first quarter to XX% million. quarter from the of income in first operating increased the $XX

margin the operating a period. by was XXX was year prior to Our in margin by operating prior period. point in our year XX.X% XX gross XX.X% basis in basis to increase point non-GAAP margin in The OpEx our basis and a increase XX point driven decrease the margin compared non-GAAP compared

interest other quarter borrowings interest expense rising increased offset compared to and in by our in expense associated was change increase First net with increase partially year. million expense million net cash balances. an rates, an interest net higher $X.X with associated income other in last was The $X.X by driven

was per $X.XX to or prior per net million or million year the $XX.X compared income $XX.X period. $X.XX share quarter in First share

earnings of first the to We leveraged in margins share non-GAAP revenue exceeded stronger-than-expected diluted operating both per in and where end expansion results high expectations. the are pleased that performance we with our our profitability drive quarter,

a of and review to our condition. sheet balance financial Turning

and and available $XXX debt cash as million, $XXX.X million, As of March million of total $XXX.X XX, million of cash XXXX, $XXX had available $XXX $XXX.X we total XXXX. borrowing December obligations approximately obligations of cash of million capacity to and and million borrowing of equivalents XX, capacity compared equivalents cash of debt approximately of

improvement last free X.Xx leverage $XX.X XX in Our million March generated quarter of a The the million basis. compared in used adjusted period. to in compared improvements free result year-over-year flow We in was inventory reduction cash the flow as in first generation of working ratio cash in capital, to year. significant the on invested an net was of year prior cash of specifically primarily $X.X dollars

free CGI more believe continue December than our period strong flow XXXX in will cash flow and to expect cash X-year We of generate again generation $XXX ending program million free the XX, XXXX. in

those have period. table release, and items financial guidance press each earnings which the a included year compared of our prior For our in reference, we how details formal ranges to

in fourth introduced is highlight unchanged However, guidance important press we what remain to all that earnings quarter release. it expectations our versus

changed last not have well. we as discussed assumptions prepared underlying in quarter our remarks the Further,

provide and profitability our for second related would XXXX. we like Lastly, the growth to of to additional expectations quarter transparency

increase X% of our expect up a X.X% the total we Specifically, to year-over-year X% revenue on on GAAP to constant currency in basis approximately year-over-year basis. a to X.X% range approximately and

The expectations approximately expectations approximately of revenue. growth in assumes constant currency Note, sales second year-over-year in quarter international includes a the X% $X.X constant decline growth markets. million sales year-over-year and currency growth midpoint inorganic quarter U.S. of midpoint of the second our also our XX%

increase is basis. Excluding a these our inorganic on quarter contributions, X.X% expected currency total year-over-year second revenue to constant approximately

of margins to XXXX, With and approximately $X.XX XX.X%, the of second EPS in profitability of expect operating we respect non-GAAP to non-GAAP XX.X% to the expect range expectations the range in our $X.XX. for quarter we

That line would to Operator, we remarks. up wraps for up open our prepared now like the questions.

Larry Biegelsen [Operator from Instructions] Wells with The Fargo. first comes question

Larry. assumptions and the through for range? to we're the on just me walk you guidance low you on that high Simran of end just the guidance. like maybe Can It to the is what off start of ahead end seems to This QX Maybe off, just some the EPS the get of modeling. start

more in of So of you're through QX phasing I points the a weighted? And quarter are follow-up. to some of the revenues maybe steady QX -- just for the what leverage And be we key QX year consider have that of assuming? the the then should and or so kind remainder

question. one. Long going to I'm let that Raul pick Raul?

Yes.

related to and as quarter, on second the includes year-over-year So for X% right? currency our start basis, on constant just far a X.X% $X.X The to basis. say, million midpoint revenue, the products. GAAP for organic X.X% to the currency specific second as is I'll year-over-year quarter, there constant the acquisition a this growth So the revenue approximately Angio X% expectation in to also approximately

rest of actually, X.X%. year EPS, Excluding the those around growth the is as items, for cadence maybe our And talk I'll inorganic as the revenue kind far there. we're of about since the

regular think kind of kind of can seasonality. a more You about of as this

QX ones. and getting quarters in QX normalized and softer we're are where So QX QX to back our seasonality that are levels, stronger

that we kind comfortable kind that cadence. think pretty to of I of back it's historical feel So

about the that think exception that us of the that we've have items kind the you impact, the expect which SKU and the With China about back year. in we then of rationalization impact will talked half also to

a go things ahead. then So consider, couple -- essentially of normalized. but to And

throughout we do -- of And was SKU remainder year? impact I the the SKU on say to the the to the think rationalization. how was What in impact the just QX? clarify going of about like

for evenly as taper talked exception we will essentially decelerate it started the year. And $XX impact the with weighted kind being about fourth off part substantial be from most you towards to those I'd for will about we the part products. quarter say that So of the it million the the of

fourth a QX, QX So little be bit heavier than and QX will the quarter.

Okay.

And sorry, more just one follow-up WRAPSODY. on

said a timing, submit May. to I you PMA April expected module the point the finer Just on of think put call, to the last you final in or

now. I think saying of if you're QX end heard I correctly,

the tracking a wiggle importantly, we approval should fourth a quarter timing? you think Or this So are we event? of of should launch? as any And interpret XXXX and to more more still

respect timing. changed has Well, I to nothing think with

right per representations. So is gone. everything schedule everything I has mean on our

that, We it's -- we'll second FDA. file expect the it's hands the then of and in quarter, the up into

of know that in I by It's end quarter. their have this the we in would that at quarter. have the submitted So process. the regulatory this will point I believe But all in said don't -- fourth will modules be data up we've FDA don't the all that to their hands the and we

Yes, messaging I obviously days, days. expect been then but would FDA quarter. And FDA has think submitted be by the our the to pretty it it's the of clear has end second we XXX that

at any So But questions. mercy. we questions and other be answer their address to we're sure any we'll ready make

The next from question comes of with Bank Securities. America Bijou Craig

the follow on had QX I and to down. a appreciate the little guidance. looking that year, bit I but up color wanted you for growth, of step And to Raul, the obviously gave, a you you're strong a strong start guys

I to bit of growth the think I'm rest one guys that looking little maybe So the segment the softer. a and other the said came OEM about at kind of through kind in the of to that And year. wanted you I dig of some into is how factors guess

throughout kind slowing a to year? about of the how for that of And OEM impacts rest the just like maybe else little looks think So year. the growth that the anything bit it's

for Yes, Craig, the thanks question.

It's to quarters But how not the just after our I QX. excited first practice it's that, It's of all, results -- quarter. our First about right? guidance X QX, we raise left. think we're for super there's

better also kind will of think the the give after on review things see and things a we'll It purchasing. China us how quarter, of surrounding bit volume-based little some look. I visibility second things the

more us a bit give clarity So there. little it'll

year. about do but we we're excited again, I well. And business the is our doing it quarter guidance first leave really the business see think how we so the the just did unchanged did, of because But

As we of our talked far continue obviously, business. conferences, me if think, levels, I is quarter openly. I've in as of year. with talking the OEM, inventory I their And during talked -- start kind last about you we kind The it reality met growth investor we've -- in OEM to expect think any solid fourth people about did managing pretty then

companies not are that the industry -- inventory is doing people say And but I'll seeing most OEM essentially on I be -- it's not just inventory know We're the it's I that's and it. think I levels. thing same better. I'm it. dealing with, to holding purchases. surmise that their other everybody doing our are back we we're think else is going would what of managing doing,

you think I number. flow free saw cash our

Our the inventory. why was really was that we or for from about free flat. flow to this were to essentially $X.X inventory able of managing million of That's just year. all And quarter last deliver $XX million cash compared QX our

So expect continue out business. OEM again, we our strong to of growth

And quick Got helpful, a on just Raul. maybe of it. follow-ups That's WRAPSODY. couple

if to So into FDA you're the guys I'll submit Fred, patient in working filing. as throw conversations between then had a last to And you data any more out wait, question on you wanted good about you how optimistic color but on would on out any me I have potential the but the there. hear, opportunity love with throw the the figure this answer, the I getting to for think know Yet giving WRAPSODY? to Fred, not I'm

report. period. cleaning efficacy position listen, as recently monitoring, the for enrolled the to and to quarter, we follow-up the data complete expect analysis the We completed study continue clinical be received in last the quarter. the completed Well, patient. a primary the and data said, the throughout outcomes, track primary and study by collection of the we've the endpoint we and the safety to I've of phase, the in end second file remain And We outcomes to the on

will where and befitting we has and correctly we our think this a I U.S. road, it do. really we've appropriate the it's do what could so. And a as we'll and I go then when for is And a these exactly And to we done It's the that's are. appropriate, we you, I opportunities when we that, this for FDA. made at time the in of we mean progress, customers, take move but that that in a going that's manner see important commercial then what on said do lot we but all we've really be we're look after for strategy, on, do disciplined. to are down of the So to at are.

best that's because the that's can way answer what we're I So it doing.

So really I a way. felt by the it's answer, that good

to try. I agree, had Fred. I

All Okay. right.

next Sandler. The Bednar comes from Piper with Jason question

Can you hear me okay?

you, Yes. We got Jason.

could has year gross maybe And the nice If pretty solid. here on start line The Great. start to darn guys. here, margin been trend I strength.

the of gross probably last the as additional things taking the can think part come bucket the versus know and here over spoke improvements to have I an And how Where improvements in maybe talk remind or the balance transfers the year? of the of and in you're of you Mexico a are a actions us you margin price gross story to confidence improvements on it allocate year-over-year right in call. underappreciated you mix now. such But new about sustaining rationalization? much like it margin you if SKU plan from? CGI can I contributor key element do

talking We're efficiencies the last product it lines I hard year, make on improvements and be our Jason, think the Yes. you same, know, about Look, And specifically as gross the right? working will think amplifies in transfers. really around kind to line of what I of product mix, more pricing and think QX business. favorable -- been I we've the So margin. worked revenue we've within improvement in for it's uplift.

XX.X our on operating think really to we at I -- XX.X XX.X you when -- guide so guidance, didn't roughly look margin, And XX.X. on gross margin. XXXX guided We

the XX to XX up basis year. points for So

And primary margin this the gross it's OpEx P&L, driver did that at you if what XX leverage. of expanded We by we would with sorry, the majority the think I almost year also or grew top the QX line be look that. gross for points. X% margin -- basis some said about in we And exactly

to expanded margin basis points, which by XX of an points. margin about operating OpEx expansion basis Our XXX led

-- the way eyes, every I a progression to a that's that's my leverage line P&L, perfect in mean strong from item.

So holds. still I'll just kind that our of say guidance

We continue expansion to our operating driven expect from margin gross some primarily margin be leverage to OpEx. with from

helps. So hopefully, that

more, No, there. it on though. They're here, couldn't does. X unrelated Yes. Maybe I either agree all the others. levers going you got ask them. I'll

the prelaunch on, I on for also item, of But just guess, against considering Or that efforts, is nice the there educational are in year? a the take you First, reconcile more our things models WRAPSODY be of there swing that, in I how that item? that this growth else we then And investments there performance unrelated VBP first first I still or outside that or quarter. we the be here you're would of even a decline should thinking XXXX about reversed later get in here to the question. we I'll is you a going had anything quarter. costs, guess be any in like do expectation China, or XX% ], sales [ factoring should posted guess though work

Joe. take is for China. question. I'll the the one this on Yes, Thanks

sales So up our were X.X% international year-on-year.

But primarily APAC, strong We out. by by, more point I XX% year-over-year. in basis XXX expectations as So said, the did a with was you as of strength China our than That And definitely that was exceeded driven end particularly growth know have about points. the related high continue good that, trends which variability a quarter-to-quarter in we've APAC, growth guidance softer just as you there. as But particular. to [ see comp, ], to so we feel expected. and on we far we given VBP

real no no we're presently. So with other update And dealing factors there.

repeat second question, And to of I... because Jason, the half your if you want

of or there's Yes, later work be we into is Or sure, cost or year? as any Yes, that our a investments item? if we those that efforts educational some Raul. investments thinking WRAPSODY, just XXXX prelaunch or model of more costs on this about should

No, Jason.

we we investments make guidance are in already. included think our whatever to So needed

from surprises there your an way So any standpoint. coming isn't investment

think brought acquisition to expenses we I heads. you outside -- needed guys of people of of make the investment reason But of biggest sales we on. year that think the I that, and where like normal for clinical was Angio the the did you things that as studies part you to last those most cover additional -- the we the know, guys kind guys

again, so people. we've hired those And

We how continue about excited included doing. are any are And to be guidance. in expenses Angio products already our the

So expect shouldn't anything of that. outside you

James. Jason from comes question next Bedford The Raymond with

follow-ups Maybe just a couple of here.

Just on the Clearly, quarter-over-quarter, gross margin. a step-up nice year-over-year.

point You covered the XQ year. low gross trend of expected revenue my kind for is the I the to margin guess question the drivers. is, higher throughout Is for year?

think on it get about what of drivers think Yes, leave We that of that. the cadence I expansion question. primary Jayson, guidance our I operating And talked that's margin into to we'll I going gave we're mean be. we a would great I don't that. know the operating that margin. at

results I color additional the I for what And stands. still with for happy have know our we're you. think guidance QX, don't that I but

Okay.

Okay.

in is sounded it that on had like following environment there [ second guide, right. XQ China And Raul, the changes more if that are up expecting? revenue half I the any impact, Just of VBP you're ] a

that's Yes, way described we've it. I the think

is we've that second strong softer of QX. think And that is But we'll one the guidance of we continue second the the things that some be after I think evaluate and our comfort growth to business we're we're Jayson. think, quarter in the for the QX little I see growth at. OEM we're in the where will there. I kind people OEM, a gives fact given hopefully, remain bit And -- kind doing, item of about the was But the rest how quarter. of confident year. reflection the think excited I expectations our again, for

Okay.

Just on that? the into on have slip into slip half? OEM these timing orders second you the dynamic, Do did visibility it XQ or

that say don't -- get for QX, inclusive, full our we and the will revenue for all a given I strong that We've growth. year and into want believe we be just to I'll guidance that. OEM it's

from The Steve comes next question Oppenheimer. Lichtman with

terms even talked specific And think in products Fred, R&D you high like this a lot some more flow. calls, you bit you this how products we several think It looks know of level I quarter, some Can I you're expected. doubles, on about feeling about noted I I here. singles pipeline? about talk you internally more you in call. addition a on on talk product to WRAPSODY. a lot highlighted sort -- of you obviously, to little Talk bit your that little about like new about of previous your there going in what's and invested from than talked a a but focus again, new

Yes. in we our to expect business. Listen, continue innovation

We we have of year. every do record track what a

hate We but I what that really Merit is new is to say product have introductions. doing. Steve, business it's as usual,

announcing are the past we product to about we for We not more because future. the to questions pipeline. our investments for other have the answer in we're make than need words, introductions sacrificing In these the earnings

the some it's But -- understand, better that, a hasn't and we understand different cadence, innovate Merit it that at deliver. CGI. other growth So When the and ways look you foundations cadence. same we it's continue helps you think for changed still if is thing in the to Merit I in do say the ways guys one and and to

and Merit, day. that be the use we X at single that are do continues words to what every Those we key

the to and things looking I'm us could that wish take and us fact, and which products brought this can't that. in do and that my we you into the will are see desk. research But at I you see sitting is future, investment here, the development. far various what continue In

or if But Great. the seeing on can there, -- but Thanks, inorganic missed side, someone your views et you're talk cetera? I apologies appetite, then And Fred. out this, you what your asked. else on latest M&A, about

that we in think position good we Yes. could well do Listen, have I a cash it's a position. We're things. known

to have I think selective. we be

look, that we've continue things the with told be the to but investors. that and consistent We to to we've has investments committed you it

the long-term for has has to the of something. fit forces to sake we in align doing business. and would just those It our sales do not So or same with continues aspects. to doing we're just It and our it objectives, with be the anything --

Michael from Research. with comes Barrington question next The Petusky

in in I off Raul, XX% adjustment making conservative guide for given was it on the the guide XX%, organic APAC awfully year thought sort for full strong to I'm QX currency constant maybe me, growth. you XX%, wondering, that's start like an of when an there QX. year seems to growth any the mean,

did. think not look going go currency our When growth year, at repeat the during constant Again, business, QX. organic we I over really constant nature in Yes. just mean, Look, to I'm how super we're excited it's we but currency, what mean look Mike, when we and did. I it's I after guidance the a to it, you start, sorry. strong at update out X%

And so I think we're looking everything. at

off excited the good to QX how I at really evaluate came business look good start. quarter a there, how is but the really out. happy And we'll we're think and -- second after things

unusual So have share I'm particularly in, second suspect you the quarter. Obviously, that a anything came Obviously, how free Like the an on speak to in to you half based would I you cash of mean more about in is the if you XX% so quarter, that? in cash this you curious free and half, last fourth year XX%? just of in mean is on Can that? cadence the say can that year it's came much of I was first cash. the there a anything guess? is in just it balanced. free going be much decent can I

with little comfortable I a seasonality this cadence, more the with think one, that and -- we our one. feel about talk I when on revenue

on many think cash flow, free so there's things control. just are just of timing-related I that sometimes our outside

to we have global global amount have. a plan inventory. for footprint so I'm to flat, with the when to And happy that that over manage really with million group than products especially operations other $XX don't a they good just started inventory, of have hard this I comfortable way and And of the keep giving really distribution with really cadence there kind because manage feel to say them year our to it it's and thanks we we

of $XXX really at that cash We least have off free year. still least to deliver million they're start. And flow end a in $XXX delivering million So confidence at through have of good we'll still confidence the this XXXX. we

good that, other QX. in about feel than I did we So how

Yes.

Fred. -- Mike, is this think I

a think deal the is deal. I this the really it me. focus headline compensated. company of this. on the a big past have a very It's we're just that's important there. thing that aligned It's commitment. candidly, think kept our commitments. Merit. small is And we And made The is the It's this. It's I We've deal. -- We big for to not entire all on out

a ask me you. Fred, one so to let last just

last think, a mean, from of and curious, game. your days commercialization. X on were starts brought of important, just experience, think your like lot brought lot sense based of on have any minutes the the Raul's minutes. of Based you is based lot a do last back You like on and to around comments, forth really stops -- XXX several football I your X sort into WRAPSODY, Q&A development of that decades, of products I'm Do expectation of -- for I the FDA of a a sort a this? product sort be not and on experience? there's do you It's going watching

important this do, that we and Listen, we're to the is on company. respond what Yes. appropriately, the from only standpoint we'll focused need to

can't answer and We we questions can to the direct control us, resources control we as can come. the they FDA. So our

So our it's Mike. really -- just part, we'll do

Sidoti Sidoti question with Next & from Jim Company. comes

you it's a you you of to past questions are for it's us get in, the And mean on When it. that kick X% of those this decline. up volume sick then I year it ended but discounts. such quite are a quarter in concerned in confident the -- know around think you going how been XX% our why as years, had I up, significant as probably thought. expect all to China, year you've quarter, strong difficult about this wasn't you're arms half know year? as price I I the the of And second

that take Jim, can Joe. one. this I is

As variability China. in lot with you quarter-to-quarter a of ] VBP there's know, [

sense in that a So will it's been come. that difficult to when you're impact project right really

to trying just we We are Asia, feel models that more year there's impact APAC continually us come. determine updating for Korea. when about guidance. But will pretty full our And China, a good which than driver in the revenue is and significant keep Japan, Southeast in mind, incorporates

projected say number fully that for with year yes, confident we're is the way. will there be So can the I along realizing we variability all some the

you see potentially of maybe first XXXX. So the could maybe impact quarter, more last the an quarter in of into

kind that don't this. I frustrating transparent point detailed to as us we're look, be But think we'll it variability. to Yes. on investors. advance our know the in But as in It's out headwinds to Jim. to quite frustrating is there get We've be trying can possible too. there, guidance. it's of frankly, I

we've think I managed it accordingly.

delivering. I, of to I any you at the a and given that's hard say, we are know China. we some surprises, products. to seeing pressure our report results we're price of looked other day, comes seeing haven't because should But are on that And We see it negatively, Joe And I and impacts. the the we, when

up we're the so and real tried manage up. impacting And think just it's that kind made But to that's isn't we've It's I appropriately. this something business. of making it

I is plan long remain the all run, is it's big future confident APAC. that's Japan think our about of the opportunity for and in think for in for confident company. we the We this Fred. a in And long-term Jim, we're critical. Look, and Merit China.

are that whole just portion it that's that a we actual the coming be was was clear that an to and knew derisk kind things in on things thinks pretty portion in and China going the from And reminder, that I think business component our the happening as could we're impact. fourth was our of were a think we have third right? in quarter call I a the goal that guidance group of we tangible guidance, on our think our to

provide those better you hopefully, we'll update we can come whether exit not, kind the guys as or second visibility see. we'll But an then have to quarter. And and fruition Now wait then. of we

looks paid Can interest that All Okay. million for rate you in me $XX like you was the down the you I the on debt And right. what's the quarter. remind on down? then assume net paid that about me. just last one It of line. debt

the there's it break sorry. I I try so and about -- I'll guess, and well, yes. couple It's looking of -- at mean, I a -- think when you're components, down,

that about So obviously something there's have, that that. we down, convert this that paying at has term X.X have loan year. have that that a like is we'll We're a around rate Then X%. or off and we of paid the

the And the part, so there's little a there. for term that's we're Jim. what loan bit variability of now, But paying right is most down

The Mike from Company. next comes question Matson & Needham with

thanks. Yes,

So just on with wanted start WRAPSODY. to one

device. for any to technology a add-on some it's that get do breakthrough and/or given to payment reimbursement you So plans transitional -- is new have additional pass-through apply there

Yes.

we -- time on pointed to of public. data, time the really a release months, that's for of the things, this as we're right Mike, the different think, X as I planning out, we lot then get through right first for release

appropriate all this been on. we've all the All worked are in And time. a for time, of being strategy these are long things at things involved

So been just will do time, you of these in right We've at will beneficial it. tell I to on to working capitalize all, us. company. None new simply things And our at that are we're these most prepared. were all to shareholders the we the

your product. Okay. week with news this Endomagnetics. competes -- believe were product that And there I they SCOUT then Hologic's earlier buying some that

a but you've assume well-known breast already with area. kind in I marketplace, the is brand of them been So Hologic in the competing

players, be maybe probably just So there's assume enough is reason I concerned us is for TAM about but... how And here. there the any multiple remind you big this? to room -- can what

Yes. Mike, is Joe. this

I can one. take think I that

right. You're

We years the market. now have in Endomag been competing for product many against the

for market As growth the probably in leader very know, about space. we the excited We're you this remain here. prospects

invest We continue the innovations. approved. which MD, was SCOUT to in We market-leading recently mentioned

lead market. delivering is goal the maintaining our simply that and So innovation on market to to to continue focus

to is expectation that there. in think Endomag against time, our addressable the the out technologies and our will, our favorably that's Again, market technologies achieve. completely to total But what over ability we're magnetic including what we're belief into I competed wire-free, get the confident compete and all we've won't market. is and past, working I go against in the

we point just But won't the we're a of our might, I view, from technology get is technology leader. but not into leader we're market think Especially technology that. the

question next The with Canaccord. Young from comes John

-- community, estimate to the won't want just you're the I where to like any on there that medical at release when quarter. it or any the Fred? you is but we scientific to on and this, sounds meetings WRAPSODY, see Congrats give looking could data

Yes.

So answer the no. is general

maybe Now more I a specific. should little

There that's that this. a created, is, it filed. talk of get factors it lot opportunity. to that go -- a want the timing Let's what factors John, being there's into here, about the are the lot We like right do correctly issues value just when to of maximize

won't. value if doesn't we do, get shareholders. and a could in we But the all, to help we So could get our first we But pushed. it of hurry,

in this and for So at the we about. And and what things, for at physicians value the is that believe at I the shareholders manner appropriate issues. think And these to appropriate been to doing disciplined counseled important, release that's we the assessment These we're what important looking This public is stuff physician that equally will the community. remember. that's time, maximizes a in that of and time. things a this have have important serious understand for information all we're of we talking are you

SIR. Okay. moving And then just maybe to

You large very showing a there, guys had too.

I Angio continuing revenues X to previously how call say scale care to of And the point? you sales call attention reps that point. force much those products radiology how is and remember up renal the Are Bluegrass X grab new is from as grow? the interventional you now? helped large for that Now

know, facility very good a our had group. Merit as over all, heard you there, you've Look, first of we here therapy part not but only physicians. think, our showing It's renal with at because of XXX

want it comment don't it launch the a on sound. continue and specific do numbers, execute but are we strategy scaling. your to had be. successful is think that way we it We believe seeing to will anticipated I program. is [ the give and We're ]? we Joe, It's out you program,

we we product to in out scale a have decided sales portfolio break enough group. dedicated that Yes,

ability And fully point, come. So confident we're for done. what scale time that's our whenever WRAPSODY that we've the fully be may of prepared launch over in to and to your that

quick needed a do WRAPSODY And Great. think is launch? then follow-up. What you Okay. scale just support to at

our to we about talk information don't things and want don't competitors, to We because we give those it's talk generally that not what about.

the answered and time, the all and have due will, these of at information in numbers, data release We TAM on all you'll appropriate time. all these things,

John, appropriate. excited about the strategy, when Yes, mentioned, the talk things, about Fred U.S. as I obviously, we'll but mean, strategy, be those product, we'll commercial reimbursement all

one me let just say thing. And other

road. this about excited down Yes. coming excited. project the extraordinarily Very are We

So just record. the for

like to no would remarks. further time. I Fred at closing the show this call back for turn questions I to

it's time. and gentlemen, Lake wish a I Raul the all be other discuss done from Signing Ladies best. lot in X We calls got Salt are going hour. much Good the And there We We've the and appreciate. thank of your consideration, you will We one-on-one. very your Joe hour. everything you available top you off very on. to we with of know City. and for evening.

This participation. your concludes today's conference call. Thank you for

now disconnect. You may