Latest Biotronic NeuroNetwork News
Jul 26, 2016
Company Delivers Double-Digit Revenue Growth and Increases Full Year 2016 Guidance SAN DIEGO, CA--(Marketwired - July 26, 2016) - NuVasive, Inc. ( NASDAQ : NUVA ), a leading medical device company focused on transforming spine surgery with minimally disruptive, procedurally-integrated solutions, announced today financial results for the quarter ended June 30, 2016. Second Quarter 2016 Highlights Revenue increased 16.4% to $236.2 million, or 16.1% on a constant currency basis; GAAP operating profit margin of 25.4%; Non-GAAP operating profit margin up 60 basis points from prior year to 15.9%; GAAP diluted earnings per share of $0.57; Non-GAAP diluted earnings per share up 28% from prior year to $0.40; and Acquired Biotronic NeuroNetwork to support spine service line partnership offerings. "NuVasive delivered another strong quarter, outperforming the spine market to deliver double-digit revenue growth, expanding our operating profitability year-over-year and delivering earnings growth of 28%," said Gregory T. Lucier, chairman and chief executive officer of NuVasive. "Our results were driven by strong growth in our international business, which benefitted from our continued revitalization efforts, and strength in our U.S. spinal hardware business, where adoption of our integrated Global Alignment platform drove momentum in sales of our procedurally integrated solutions. With this growth in our geographies and businesses for the first half of the year, and the addition of the Biotronic NeuroNetwork business, we are raising our full year guidance for 2016. " NuVasive achieved several strategic milestones in the second quarter. The Company completed the acquisition of Biotronic NeuroNetwork on July 1, and combined the service offerings of Biotronic with its Impulse Monitoring business to form NuVasive Clinical Services. This new division doubles the Company's service line footprint and will provide intraoperative neurophysiological monitoring services to surgeons and healthcare facilities in more than 75,000 U.S. cases annually. Also, the Company reached a definitive agreement with Medtronic to settle more than eight years of ongoing patent litigation between the two companies, removing the associated expense of legal proceedings and providing a clear protocol for resolution of potential patent disputes in the future. A full reconciliation of GAAP to non-GAAP measures can be found in the tables of this news release. Second Quarter 2016 Results NuVasive's financial results for the second quarter 2016 are inclusive of results from Ellipse Technologies, Inc. and Mega Surgical, as both of these previously disclosed acquisitions were completed in the first quarter 2016. Ellipse Technologies now operates as a wholly owned subsidiary under the renamed legal entity NuVasive Specialized Orthopedics, Inc. (NSO). NuVasive reported second quarter 2016 total revenue of $236.2 million, a 16.4% increase compared to $202.9 million for the second quarter 2015. On a constant currency basis, second quarter 2016 total revenue increased 16.1% compared to the same period last year. For the second quarter 2016, GAAP and non-GAAP gross profit was $176.5 million and $183.8 million, respectively, while GAAP and non-GAAP gross margin was 74.7% and 77.8%, respectively. These results compared to GAAP and non-GAAP gross profit of $154.5 million and GAAP and non-GAAP gross margin of 76.1% for the second quarter 2015. Total GAAP and non-GAAP operating expenses were $116.4 million and $146.4 million, respectively, for the second quarter of 2016. These results compared to GAAP and non-GAAP operating expenses of $128.6 million and $123.5 million, respectively, for the second quarter 2015. During the second quarter, the Company elected to early adopt the new FASB Accounting Standards Update (ASU) for employee share-based payment accounting ahead of the mandatory 2017 effective date for all U.S. public companies. The Company adopted the ASU in the second quarter 2016, effective from January 1, 2016. In connection with the adoption, the Company recast its first quarter 2016 results. The impact of the adoption had a favorable impact to the first and second quarter results, and will be favorable for full year 2016. The adoption of the ASU, together with the Company's ongoing tax planning initiatives, are expected to drive significant improvements in the Company's effective tax rate over time. NuVasive reported a GAAP net income of $30.2 million, or $0.57 per share, for the second quarter 2016 compared to $10.3 million, or $0.20 per share, for the second quarter 2015. On a non-GAAP basis, the Company reported net income of $20.6 million, or $0.40 per share for the second quarter 2016 compared to $15.7 million, or $0.31 per share, for the second quarter 2015. Cash, cash equivalents and short and long-term marketable securities were approximately $331.0 million at June 30, 2016. Annual Guidance for 2016 The Company provided the following updated projections to its full year 2016 guidance, which contemplates the impact of the Company's performance for the first half of 2016, the acquisition of Biotronic NeuroNetwork and the impact from the adoption of the ASU for employee share-based payment accounting, as well as expected changes in foreign currency rates: Revenue of approximately $962.0 million, which includes a $1 million benefit from currency or approximately 18.6% growth compared to revenue of $811.1 million for 2015; versus a prior expectation of $928.0 million for 2016; Non-GAAP diluted earnings per share of approximately $1.64, an increase of approximately 25.0% compared to non-GAAP diluted earnings per share of $1.31 for 2015; versus a prior expectation of $1.48 for 2016; Non-GAAP operating profit margin of approximately 16.0%, an increase of 60 basis points compared to 15.4% for 2015; versus a prior expectation of approximately 15.8% for 2016; Adjusted EBITDA margin of approximately 25.4%, an increase of approximately 20 basis points, in line with the prior expectation, compared to 25.2% for 2015; and Non-GAAP effective tax expense rate of approximately 37%; versus a prior expectation of approximately 41% for 2016. Supplementary Financial Information For additional financial detail, please visit the Investor Relations section at www.nuvasive.com to access Supplementary Financial Information.