- Revenue growth of 68% for full year 2021, including organic
revenue growth of 50%
- U.S. organic revenue 3-year CAGR of 36%
- Fourth quarter EOS imaging-related revenue of $12.8
million
Alphatec Holdings, Inc. (Nasdaq: ATEC), a provider of innovative
solutions dedicated to revolutionizing the approach to spine
surgery, today announced financial results for the quarter and full
year ended December 31, 2021, and recent corporate highlights.
Fourth Quarter and Full Year 2021 Financial
Results
Quarter Ended December 31,
2021
Year Ended December 31, 2021
Total revenue
$74.0 million
$243.2 million
GAAP gross margin
61.1%
64.9%
Non-GAAP gross margin
70.5%
72.8%
Operating expenses
$83.4 million
$285.8 million
Non-GAAP operating expenses
$66.2 million
$225.6 million
GAAP operating loss
($38.1) million
($128.1) million
Non-GAAP adjusted EBITDA
($7.5) million
($28.1) million
Ending cash balance
$187.2 million
Recent Highlights
- Accelerated adoption of Prone Trans-Psoas (PTP) Technique, with
ATEC lateral procedures delivering over 40% of Q4 revenue
growth;
- Expanded momentum of the recently launched ALIF System
advancing anterior column prowess;
- Trained over 400 surgeons in 2021, contributing to a 23%
increase in surgeon users in Q4 compared to prior year;
- Generated $12.8 million in EOS-related revenue, with
significant momentum in sales, product development and data
management since close of transaction.
“2021 marks the highest revenue on record for ATEC and another
year of sector-leading growth,” remarked Pat Miles, Chairman and
Chief Executive Officer. “The magnitude and consistency of our
growth is a direct reflection of our ability to earn surgeon trust.
That trust is a result of our relentless commitment to creating
clinically distinct technology that improves the predictability and
reproducibility of spine surgery. In 2022, we will continue to
expand the lateral market with PTP, advance our distribution
network, and place EOS imaging systems while driving portfolio-wide
adoption. ATEC is becoming a force in the spine industry.”
Financial Outlook for the Full Year 2022
The Company continues to expect total revenue for the fiscal
year ended December 31, 2022, to approximate $305 million,
reflecting growth of approximately 25% compared to the full year
2021. This includes organic revenue growth of 23% and approximately
$45 million of revenue related to EOS imaging.
Investor Webcast
ATEC will present these results via a live webcast today at 1:30
p.m. PT / 4:30 p.m. ET. The live webcast can be accessed by
visiting the Investor Relations Section of ATEC’s Corporate
Website.
To dial-in to the webcast, please register via this link.
A replay of the webcast will remain available through the
Investor Relations section of ATEC’s Corporate Website at
investors.alphatecspine.com for twelve months. In addition, a
dial-in replay will be available beginning two hours after the
webcast’s completion until March 8, 2022. The replay dial-in
numbers are (800) 585-8367 for domestic callers and (416) 621-4642
for international callers. Please use the replay conference ID
number 6548679.
Non-GAAP Financial Information
To supplement the Company’s financial statements presented in
accordance with generally accepted accounting principles in the
United States of America (GAAP), the Company reports certain
non-GAAP financial measures, including non-GAAP gross margin,
non-GAAP operating expenses, non-GAAP operating loss, and non-GAAP
adjusted EBITDA. The Company believes that these non-GAAP financial
measures provide investors with an additional tool for evaluating
the Company's core performance, which management uses in its own
evaluation of continuing operating performance, and a baseline for
assessing the future earnings potential of the Company. The
Company’s non-GAAP financial measures may not provide information
that is directly comparable to that provided by other companies in
the Company’s industry, as other companies in the industry may
calculate non-GAAP financial results differently, particularly
related to non-recurring, unusual items. Non-GAAP financial results
should be considered in addition to, and not as a substitute for,
or superior to, financial measures calculated in accordance with
GAAP. Included below are reconciliations of the non-GAAP financial
measures to the comparable GAAP financial measures.
About Alphatec Holdings, Inc.
ATEC, through its wholly owned subsidiaries, Alphatec Spine,
Inc., EOS imaging S.A. and SafeOp Surgical, Inc., is a medical
device company dedicated to revolutionizing the approach to spine
surgery through clinical distinction. ATEC’s Organic Innovation
Machine™ is focused on developing new approaches that integrate
seamlessly with the Company’s expanding AlphaInformatiX Platform to
better inform surgery and more safely and reproducibly achieve the
goals of spine surgery. ATEC’s vision is to become the Standard
Bearer in Spine. For more information, visit us at
www.atecspine.com.
Forward Looking Statements
This press release contains "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995
that involve risks and uncertainty. Such statements are based on
management's current expectations and are subject to a number of
risks and uncertainties that could cause actual results to differ
materially from those described in the forward-looking statements.
The Company cautions investors that there can be no assurance that
actual results will not differ materially from those projected or
suggested in such forward-looking statements as a result of various
factors. Forward-looking statements include, but are not limited
to: references to the Company’s revenue and growth outlook; planned
product launches, introductions, regulatory submissions or
clearances; efforts to transform sales and distribution channels;
the Company’s ability to compel surgeon adoption; the Company’s
future ability to finance its operations and sufficiency of its
cash runway; and statements about the potential benefits and
synergies of the acquisition of EOS imaging, S.A. Important factors
that could cause actual operating results to differ significantly
from those expressed or implied by such forward-looking statements
include, but are not limited to: the uncertainty of success in
developing new products or products currently in the pipeline; the
uncertainties in the Company’s ability to execute upon its
strategic operating plan; the uncertainties regarding the ability
to successfully license or acquire new products, and the commercial
success of such products; failure to achieve acceptance of the
Company’s products by the surgeon community; failure to obtain FDA
or other regulatory clearance or approval or unexpected or
prolonged delays in the process; continuation of favorable
third-party reimbursement; unanticipated expenses or liabilities or
other adverse events affecting cash flow or the Company’s ability
to achieve profitability; uncertainty of additional funding; the
Company’s ability to compete with other products or with emerging
technologies; product liability exposure; an unsuccessful outcome
in any litigation; patent infringement claims; claims related to
the Company’s intellectual property; the Company’s ability to meet
its financial obligations; the impact of the COVID-19 pandemic on
the Company and economy; and uncertainties and risks related to the
integration of EOS imaging, S.A. A further list and description of
these and other factors, risks and uncertainties can be found in
the Company's most recent annual report, and any subsequent
quarterly and current reports, filed with the Securities and
Exchange Commission. ATEC disclaims any intention or obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events, or otherwise, unless
required by law.
ALPHATEC HOLDINGS,
INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except per
share amounts)
Three Months Ended
Year Ended
December 31,
December 31,
2021
2020
2021
2020
unaudited
Revenue: Revenue from products and services
$
73,922
$
43,123
$
242,258
$
141,079
Revenue from international supply agreement
40
831
954
3,782
Total revenue
73,962
43,954
243,212
144,861
Cost of sales
28,737
12,563
85,450
42,360
Gross profit
45,225
31,391
157,762
102,501
Operating expenses: Research and development
8,984
5,355
32,015
18,745
Sales, general and administrative
66,692
39,725
229,271
129,156
Litigation-related expenses
5,412
3,045
11,123
8,552
Amortization of acquired intangible assets
1,956
172
5,348
688
Transaction-related expenses
209
130
6,365
4,223
Restructuring expenses
110
—
1,697
—
Total operating expenses
83,363
48,427
285,819
161,364
Operating loss
(38,138
)
(17,036
)
(128,057
)
(58,863
)
Interest and other expense, net: Interest expense, net
(1,504
)
(3,700
)
(7,108
)
(12,374
)
Loss on debt extinguishment, net
—
(6,057
)
(7,434
)
(7,612
)
Other expenses, net
(544
)
—
(1,563
)
—
Total interest and other expenses, net
(2,048
)
(9,757
)
(16,105
)
(19,986
)
Net loss before taxes
(40,186
)
(26,793
)
(144,162
)
(78,849
)
Income tax provision
1
5
164
145
Net loss
$
(40,187
)
$
(26,798
)
$
(144,326
)
$
(78,994
)
Net loss per share, basic and diluted
$
(0.40
)
$
(0.35
)
$
(1.50
)
$
(1.18
)
Weighted average shares outstanding, basic and diluted
99,300
77,098
96,197
67,020
Stock-based compensation included in: Cost of revenue
$
248
$
138
$
737
$
512
Research and development
1,454
632
4,056
2,114
Sales, general and administrative
8,024
4,202
31,657
15,033
$
9,726
$
4,972
$
36,450
$
17,659
ALPHATEC HOLDINGS,
INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands)
December 31, 2021
December 31, 2020
ASSETS
Current assets: Cash and cash equivalents
$
187,248
$
107,765
Accounts receivable, net
41,893
23,527
Inventories
91,703
46,001
Prepaid expenses and other current assets
10,313
5,439
Withholding tax receivable from Officer
—
1,076
Current assets of discontinued operations
—
352
Total current assets
331,157
184,160
Property and equipment, net
87,401
36,670
Right-of-use asset
25,283
1,177
Goodwill
39,689
13,897
Intangible assets, net
85,274
24,720
Other assets
3,249
541
Noncurrent assets of discontinued operations
—
58
Total assets
$
572,053
$
261,223
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities: Accounts payable
$
25,737
$
17,599
Accrued expenses and other current liabilities
55,549
35,264
Contract liability
15,255
—
Short-term debt
342
4,167
Current portion of operating lease liability
4,212
885
Current liabilities of discontinued operations
—
397
Total current liabilities
101,095
58,312
Total long-term liabilities
367,933
49,428
Redeemable preferred stock
23,603
23,603
Stockholders' equity
79,422
129,880
Total liabilities and stockholders' equity
$
572,053
$
261,223
ALPHATEC HOLDINGS,
INC.
RECONCILIATION OF NON-GAAP
FINANCIAL MEASURES
(in thousands)
Three Months Ended
Year Ended
December 30,
December 30,
2021
2020
2021
2020
unaudited Gross profit, GAAP
$
45,225
$
31,391
$
157,762
$
102,501
Add: amortization of intangible assets
268
269
1,075
1,075
Add: stock-based compensation
248
138
737
512
Add: purchase accounting adjustments on acquisitions
2,083
—
6,423
—
Add: excess and obsolete write-down
4,305
1,615
11,147
7,044
Non-GAAP gross profit
$
52,129
$
33,413
$
177,144
$
111,132
Gross margin, GAAP
61.1
%
71.4
%
64.9
%
70.8
%
Add: amortization of intangible assets
0.4
%
0.6
%
0.4
%
0.7
%
Add: stock-based compensation
0.3
%
0.3
%
0.3
%
0.4
%
Add: purchase accounting adjustments on acquisitions
2.8
%
0
%
2.6
%
0.0
%
Add: excess and obsolete write-down
5.8
%
3.7
%
4.6
%
4.9
%
Non-GAAP gross margin
70.5
%
76.0
%
72.8
%
76.7
%
Three Months Ended
Year Ended
December 30,
December 30,
2021
2020
2021
2020
unaudited Operating expenses, GAAP
$
83,363
$
48,427
$
285,819
$
161,364
Adjustments: Stock-based compensation
(9,478
)
(4,834
)
(35,713
)
(17,147
)
Litigation-related expenses
(5,412
)
(3,045
)
(11,123
)
(8,552
)
Amortization of intangible assets
(1,956
)
(172
)
(5,348
)
(688
)
Transaction-related expenses
(209
)
(130
)
(6,365
)
(4,223
)
Restructuring expenses
(110
)
—
(1,697
)
—
Non-GAAP operating expenses
$
66,198
$
40,246
$
225,573
$
130,754
Three Months Ended
Year Ended
December 30,
December 30,
2021
2020
2021
2020
unaudited Operating loss, GAAP
$
(38,138
)
$
(17,036
)
$
(128,057
)
$
(58,863
)
Depreciation
6,544
2,704
20,332
9,186
Amortization of intangible assets
2,226
441
6,424
1,763
EBITDA
(29,368
)
(13,891
)
(101,301
)
(47,914
)
Add back significant items: Stock-based
compensation
9,726
4,972
36,450
17,659
Purchase accounting adjustments on acquisitions
2,083
—
6,423
—
Excess & obsolete write-down
4,305
1,615
11,147
7,044
Litigation-related expenses
5,412
3,045
11,123
8,552
Transaction-related expenses
209
130
6,365
4,223
Restructuring expenses
110
—
1,697
—
Adjusted EBITDA
$
(7,523
)
$
(4,129
)
$
(28,096
)
$
(10,436
)
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220301005574/en/
Investor/Media Contact: Tina Jacobsen, CFA Investor
Relations (760) 494-6790 investorrelations@atecspine.com Company
Contact: J. Todd Koning Chief Financial Officer
investorrelations@atecspine.com
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