MiMedx Group, Inc. (NASDAQ:MDXG) Q1 2017 Earnings Conference Call - Final Transcript
Apr 28, 2017 • 10:30 am ET
Good day, ladies and gentlemen, and welcome to the MiMedx Group, Incorporated Q1 2017 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. (Operator Instructions). As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Thornton Kuntz, SVP of Administration. Please go ahead.
Thank you, operator and good morning everyone. (Forward-Looking Cautionary Statements) With that, I'll turn the call over to Pete Petit, MiMedx's Chairman and CEO.
Good morning. Thank you for joining us for our first quarter 2017 conference call. I have with me today Bill Taylor, our President and COO; Mike Senken, our CFO; Chris Cashman, one of our Executive Vice Presidents and Chief Commercialization Officer; and Mark Landy, our VP, Strategic Initiatives. There are other executives in the room with us. I'm going to start by giving you some overviews of our first quarter revenues, profits and cash flows; I'll also review some of the discussion we had on the March 9 call when we announced our new strategic plan and vision for MiMedx, and I'll give you a couple of other updates.
As we previously announced, our first quarter revenues exceeded the upper end of our guidance and reached $72.6 million. That's a 36% increase over first quarter of 2016. This very nice increase took place in spite of our first quarter having normal seasonal constraints from health plan benefit resets and winter weather making it difficult for patients to visit their physicians. In addition, we had some slight dislocations associated with the termination of seven sales employees for cause and replacement of new salespersons in those (inaudible).
As we look forward in 2017, we are very confident by our revenues continue to grow at a robust pace as we have forecasted. We're confident in our second quarter continuing our growth trends. However, we are very confident about our third and fourth quarter growth trends because we will have completed the wind-down of our health care contract and those administrative distractions. You saw the increase in our profitability over the fourth quarter. As we previously stated, our profits, as a percent of revenues and overall profit, should increase very nicely during 2017 because we have most of our new product expenditures and promotions behind us that we talked about taking place last year.
Therefore, we should expect to see an increasing degrees of profitability as the year unfolds. As we stated, we built cash rapidly during the quarter and that allowed us to repurchase over $12.6 million of our very undervalued stock during the first quarter. We still have approximately $17.3 million of our current repurchase program in place. We will continue to repurchase our shares when we consider them undervalued. We have had a significant increase in our market capitalization last month or so.
However, according to the metrics established by a number of investment bankers, the company