Wright Medical Group (WMGI) Misses Q1 EPS by 27c, Revenues Beat; Affirms FY19 EPS/Revenue Guidance

Wright Medical Group (NASDAQ: WMGI) reported Q1 EPS of ($0.24), $0.27 worse than the analyst estimate of $0.03. Revenue for the quarter came in at $230.1 million versus the consensus estimate of $226.16 million.

Robert Palmisano, president and chief executive officer, commented, “Our first quarter net sales results represent an outstanding start to 2019, with 18% constant currency growth, and 13% pro-forma and organic constant currency growth, driven by exceptional performance across our total U.S. business with organic growth of 17%. This was led by U.S. upper extremities growth of 21% and 11% organic U.S. foot and ankle growth, with 18% growth in our total ankle franchise and above market growth in the ambulatory surgery center segment. In addition, Cartiva sales of $9.2 million finished ahead of expectations and returned to year over year growth ahead of schedule.”

Palmisano continued, “Our U.S. shoulder business delivered another strong performance with 21% growth, which is approximately triple the market growth rate. We continue to take share in U.S. shoulder, and we anticipate that accelerating adoption of our BLUEPRINT enabling technology, SIMPLICITI shoulder, our ongoing PERFORM Reversed launch and the upcoming full launch of our REVIVE revision shoulder system will continue to drive outstanding shoulder sales growth in 2019 and beyond. On the lower extremities side of the business, we had an excellent quarter organically with high teens growth in total ankle and strong double-digit growth in the ambulatory surgery center portion of our business. Additionally, Cartiva was fully launched with our U.S. lower extremities sales force on January 1, including the integration of the former Cartiva distributors that we have chosen to retain. We couldn’t be happier with the Cartiva acquisition. This provides us with another platform technology with high gross margins and many avenues for growth.”

Palmisano further commented, “In addition to these strong sales growth results, we also achieved record gross margins of 80% and adjusted EBITDA margin expansion of approximately 300 basis points, all of which we believe put us on a strong pathway for the remainder of the year and right on track to achieve our previously stated goals of double-digit net sales growth and adjusted EBITDA margin in excess of 20% for the full fourth quarter of 2019.”

GUIDANCE:

Wright Medical Group sees FY2019 EPS of $0.17-$0.25, versus the consensus of $0.21. Wright Medical Group sees FY2019 revenue of $954-966 million, versus the consensus of $961.57 million.

For earnings history and earnings-related data on Wright Medical Group (WMGI) click here.

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