• Total Worldwide Revenue: $73 million, growth of approximately 9% year-over-year.
• MedTech Segment Revenue: $31.6 million, a 25% year-over-year increase.
• Mechanical Thrombectomy Revenue: Increased 46.2% year-over-year.
• Alphavac Revenue: $2.5 million, an increase of 33.3% year-over-year.
• Angiovac Revenue: $8.1 million, an increase of 50.7% year-over-year.
• NanoKnife Revenue: $6 million, an increase of 4.9% year-over-year.
• Adjusted EBITDA: $3.1 million, compared to a loss of $10,000 in the prior year.
• Adjusted EPS: Loss of $0.04 per share, improving from a loss of $0.08 per share in the prior year.
• Operating Cash Flow: Generated $2.5 million.
• Gross Margin: 54.7%, a decrease of 10 basis points year-over-year.
• Cash and Cash Equivalents: $54.1 million as of November 30, 2024.

• Warning! GuruFocus has detected 8 Warning Signs with ANGO.

Release Date: January 08, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• AngioDynamics Inc (NASDAQ:ANGO) reported a strong second quarter with total worldwide revenue of $73 million, representing a 9% year-over-year growth.
• The MedTech segment showed impressive performance, growing 25% year-over-year, driven by growth across all platforms.
• The mechanical thrombectomy business, including Alphavac and Angiovac, grew approximately 46% over the second quarter of last year.
• The company achieved positive adjusted EBITDA of $3.1 million and generated $2.5 million in operating cash flow.
• Significant progress was made with the Nanoknife system, including an expanded FDA indication for prostate tissue ablation and a new CPT code for reimbursement.

Negative Points

• The Med Device segment revenue was flat compared to the prior year, indicating challenges in growth outside the MedTech segment.
• Gross margin decreased by 10 basis points compared to the previous year, primarily due to inflationary pressures and costs associated with the transition to outsourced manufacturing.
• Adjusted EPS was a loss of $0.04 per share, although improved from a loss of $0.08 per share in the previous year.
• The company expects to utilize approximately $10 million of cash in the third quarter before returning to cash generation in the fourth quarter.
• There are ongoing challenges with the transition to outsourced manufacturing, which may create some under absorption in the back half of the fiscal year.

Q & A Highlights

Q: What drove the acceleration in AngioVac and how sustainable is it? Also, what are the plans for Alphavac's commercial execution? A: James Clemmer, CEO, explained that the synergy between AngioVac and Alphavac is driving growth. The sales and marketing teams are fully trained, leading to cross-selling opportunities. The company is adding new resources and leveraging existing relationships to maintain momentum. Stephen Trowbridge, CFO, added that the comprehensive portfolio offering is a significant advantage, and the positive feedback from physicians supports continued growth.

Q: How do you view the recent M&A activity in the market, and what changes might it bring to your commercial plans? A: Stephen Trowbridge, CFO, stated that while they are assessing the impact of recent M&A activity, AngioDynamics will continue to leverage its combined portfolio and invest in sales and marketing resources. The company is well-positioned to continue taking market share and driving growth.

Q: Can you provide an update on the potential indication expansion for Arion into Iliofemoral DVT and Coronary? A: James Clemmer, CEO, mentioned that while they believe Arion could perform well in these areas, further R&D and regulatory clearances are needed. The company is evaluating the best use of resources to maximize shareholder value and will provide more details once decisions are made.

Q: What is the outlook for mechanical thrombectomy growth in the second half of the year? A: Stephen Trowbridge, CFO, indicated that mechanical thrombectomy is expected to be a significant contributor to growth, with continued double-digit growth anticipated. The company is pleased with the first-half performance and expects sequential and year-over-year growth to continue.

Q: How is the transition to outsourced manufacturing impacting gross margins, and what should we expect in the back half of the year? A: Stephen Trowbridge, CFO, explained that while the mix shift towards MedTech is a tailwind for gross margins, the transition to outsourced manufacturing is causing some under-absorption of overhead costs. The company is on track with the manufacturing transfer, which will ultimately benefit gross margins and the bottom line.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.