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Merit Medical Systems (MMSI) 1 Aug 24 2024 Q2 Earnings call transcript

AInvestSaturday, Aug 3, 2024 2:15 pm ET
1min read

In a recent earnings call, Merit Medical Systems showcased a robust performance for the second quarter of 2024, with a total revenue of $338 million, marking a 5.6% year-over-year increase on a GAAP basis and a 6.6% increase on a constant currency basis. The company's strong organic growth and contributions from acquired products exceeded high-end expectations, leading to notable profitability and free cash flow achievements.

Financial Highlights and Operational Progress

Merit Medical Systems reported impressive financial results for the second quarter, with non-GAAP gross profit and operating profit growth of 6% and 11%, respectively. These figures resulted in year-over-year margin expansion by approximately 15 basis points and 92 basis points, respectively, contributing to a 17% increase in non-GAAP earnings per share. The company also generated nearly $58 million of free cash flow in the quarter, setting a record for Merit and marking a more than fivefold increase year-over-year.

In terms of operational progress, Merit Medical Systems announced multiple regulatory clearances and commercial introductions for new products, including the Siege vascular plug and the Bearing nsPVA Express prefilled syringe in the United States and Australia. The company also announced the U.S. commercial release of the basixSKY inflation device, further enhancing its comprehensive portfolio of inflation devices.

Strategic Acquisition and Future Outlook

Merit Medical Systems' strategic acquisition of assets from EndoGastric Solutions for approximately $105 million is expected to strengthen its endoscopy product portfolio and expand its global footprint in the gastrointestinal market. This acquisition aligns with the company's continued growth initiatives program, with sales contributions estimated in the range of $13 million to $15 million over the second half of 2024. The company also expects the acquisition to be accretive to its multiyear total company growth profile on an annualized basis going forward.

Looking ahead, Merit Medical Systems is optimistic about its financial performance and growth prospects, with updated guidance for the full year of 2024. The company anticipates a strong finish to the year, with a focus on delivering continued execution, stable currency growth, improving profitability, and solid free cash flow.

Key Takeaways

Merit Medical Systems' second quarter earnings call highlighted a strong financial performance, with robust revenue growth, increased profitability, and record-breaking free cash flow generation. The company's strategic acquisitions, regulatory clearances, and commercial introductions underscore its commitment to innovation and market expansion. With a focus on continued growth initiatives and a solid financial outlook, Merit Medical Systems is well-positioned for future success.

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