Globus Medical, Inc. (NYSE:GMED) Q3 2019 Earnings Conference Call Transcript

Nov 06, 2019 • 04:30 pm ET

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Globus Medical, Inc. (NYSE:GMED) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by and welcome to Globus Medical's Third Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]

I would now like to turn our call over to Brian Kearns, Senior Vice President of Business Development and Investor Relations. Sir, please go ahead.

Executive
Brian Kearns

Thank you, Jason, and thank you everyone for being with us today. Joining today's call from Globus Medical will be Dave Demski, President and CEO; Dan Scavilla, Executive Vice President, Chief Commercial Officer and Keith Pfeil, Senior Vice President and Chief Financial Officer. This review is being made available via webcast accessible through the Investor Relations section of the Globus Medical website at www.globusmedical.com.

Before we begin, let me remind you that some of the statements made during this review are or may be considered forward-looking statements. Our Form 10-K for the 2018 fiscal year and our subsequent filings with the Securities and Exchange Commission identify certain factors that could cause our actual results to differ materially from those projected in any forward-looking statements made today. Our SEC filings, including the 10-K are available on our website.

We do not undertake to update any forward-looking statements as a result of new information or future events or developments. Our discussion today will also include certain financial measures that are not calculated in accordance with generally accepted accounting principles or GAAP. We believe these non-GAAP financial measures provide additional information pertinent to our business performance. These non-GAAP financial measures should not be considered replacements for and should be read together with the most directly comparable GAAP financial measures. Reconciliations to the most directly comparable GAAP measures, are available on the schedules accompanying the press release and on the Investor Relations section of the Globus Medical website.

With that I will now turn the call over to Dave Demski, our President and CEO.

Executive
David M. Demski

Thank you Brian, and good afternoon everyone. Globus Medical had an outstanding third quarter, once again delivering above market growth and industry-leading profitability. Revenue for the quarter was $196 million up 16% over the third quarter of 2018. As Musculoskeletal Solutions continue to grow well in excess of the market in all sectors up by 11.8% over last year. Enabling Technologies delivered back to back strong quarters producing $13.9 million in revenue, more than double our Q3, '18 performance. Non-GAAP EPS was $0.43 per share versus $0.39 a year ago, an increase of 10%.

Adjusted EBITDA improved by -- to 33.4% in Q3 compared to 31.5% we posted for the first half of this year. The results include the planned investments we made in growth initiatives such as INR and trauma. Factoring out the impact of these investments, would have resulted in an improvement of $0.06 to non-GAAP EPS and added approximately 600 basis points to adjusted EBITDA margin. Globus continues to achieve market-leading operating margins even as we invest in key strategic initiative.

Musculoskeletal Solutions