MiMedx Group, Inc. (NASDAQ:MDXG) Q1 2018 Earnings Conference Call - Final Transcript

Apr 26, 2018 • 10:30 am ET


MiMedx Group, Inc. (NASDAQ:MDXG) Q1 2018 Earnings Conference Call - Final Transcript


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Good day ladies and gentlemen, and welcome to the Q1 MiMedx Shareholder Conference Call. At this time, all participants are in a listen-mode. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce Robert Borchert, Vice President, Investor Relations. Sir, you may begin.

Robert P. Borchert

Thank you, Heather, and good morning everyone. I like to remind you that our comments today may include forward-looking statements that are subject to risk and uncertainty and actual results could differ materially. We list the factors that might cause the actual results to differ materially in our filings with the Securities and Exchange Commission, which are available on our website, midedx.com. We do not undertake to update or revise any forward-looking statement except as maybe required by the Company's disclosure obligations in filings it makes with the SEC under Federal Securities Laws. Finally, MiMedx is not responsible for the accuracy of our telecast conference transcripts provided by third parties. The only authorized live and archived webcasts are located on our website.

Now I will turn the call over to MiMedx's Chairman and CEO, Pete Petit.

Pete Petit

Thank you, Robert. Good morning. We appreciate you joining us for this quarterly update. I have with me Bill Taylor, our President and Chief Operating Officer; Mike Senken, our Chief Financial Officer; Chris Cashman, our Executive Vice President and Chief Commercialization Officer; and Debby Dean, one of our other Executive Vice Presidents who has wide responsibilities.

First please refer to our December 13th, 2017 press release for our 2018 financial guidance. Given the investigation by audit committee, we cannot release the specifics of our financials yet. However, we can give you sufficient information to assist you in understanding how excellent our first quarter was. For the first quarter, we exceeded top-end of our revenue guidance nicely. Recall that our top-end revenue guidance was $92 million. Also our distributor and OEM revenue was less than 5% of our total revenue. That is the way it's been for a number of quarters now.

Our cash flow for the quarter was strong and we are tracking to or exceeding our annual goals on gross margin of 89% to 90%. Operating income of 15% to 17%, as well as fully diluted GAAP EPS of 30% to 35%, and adjusted EPS of $0.45 to $0.50. Refer to the December 13th press release for more details on those particular items if necessary. We are also increasing our 2018 revenue guidance and providing guidance on our second quarter. We had previously communicated revenue guidance in that press release for 2018 of $383 million to $387 million. We are increasing our revenue guidance range to $389 million to $394 million because of our performance in the first quarter, and of course, anticipated performance throughout the year.

Relative to the second quarter, net revenue is now expected to be $96 million to $98 million. We had what I consider to be an excellent quarter. Operationally we are continuing to improve our manufacturing processes, which now