Vapotherm (VAPO) Tops Q1 EPS by 3c, Revenues Beat; Offers FY21 Revenues Outlook

Vapotherm (NYSE: VAPO) reported Q1 EPS of ($0.40), $0.03 better than the analyst estimate of ($0.43). Revenue for the quarter came in at $32.3 million versus the consensus estimate of $31.79 million.

First Quarter 2021 Summary

• Revenue for the first quarter of 2021 was $32.3 million, representing a 69% increase over the prior year period
• Worldwide installed base of Precision Flow Hi-VNI systems grew by 73% compared to the first quarter of 2020
• Gross margin was 53.1% or 490 basis points higher than gross margin of 48.2% in the first quarter of 2020

“We were pleased with our performance during the first quarter,” said Joe Army, President and CEO of Vapotherm. “We grew our worldwide Installed Base, improved our gross margin by 490 basis points, and reduced our adjusted EBITDA loss to $5.2 million. For the rest of 2021, we will focus on educating our Customers on how to use High Velocity Therapy for hypercapnic Patients experiencing respiratory distress, growing the Installed Base, and launching our next generation technology platform, HVT 2.0.”

GUIDANCE:

Vapotherm sees FY2021 revenue of $82-88 million, versus the consensus of $87.15 million.

The assumptions we made related to our fiscal 2021 outlook remain the same as provided on our fourth quarter earnings call held on February 24, 2021. However, given the impact of COVID-19 in our International markets, we now expect a higher contribution of revenue from the International markets than our historical levels, especially in the second quarter of 2021.

As a reminder, the assumptions we stated in the fourth quarter earnings call were as follows. We continue to believe that, beginning in the second quarter of 2021, there will be very limited budget dollars available for capital equipment and, as a result, we expect capital sales to decrease significantly year over year given the COVID-19 driven demand we experienced in 2020. In addition, our current expectations are that vaccination efforts will be successful and will result in a declining number of COVID-19 cases and hospitalizations over the last three quarters of the year thereby reducing COVID-19 related demand for our disposables as well. Despite this, we expect that disposables will show year over year growth in the U.S due to an increased installed base and greater awareness of our ability to treat the symptoms of respiratory distress in all patients, including those who are hypercapnic. Lastly, given the significant expected year over year decrease in sales and production volumes for the last three quarters of this year, especially related to capital equipment, we expect full year gross margins to decrease year over year before improving next year to levels above 2020.

The Company continues to expect full year revenue to be between $82 million and $88 million, which represents a two-year compound annual growth rate of 33% at the mid-point of this range. We continue to expect full year gross margins of 46% to 48% and full year operating expenses of $97 million to $99 million.

For earnings history and earnings-related data on Vapotherm (VAPO) click here.

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