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Cardiovascular Systems (CSII) Q4 Earnings, Revenues Miss Mark
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Cardiovascular Systems, Inc. reported a loss of 25 cents per share for fourth-quarter fiscal 2022 compared with a loss of 14 cents in the prior-year period. The reported loss was wider than the Zacks Consensus Estimate of a loss of 22 cents.
Our projection of Q4 loss per share was 24 cents.
For the full year, the company reported a loss of 94 cents per share, which compared unfavorably with a loss of 35 cents per share in the year-ago period.
For the full fiscal, we project a loss per share of 94 cents.
Net Sales
Cardiovascular Systems’ revenues of $62.5 million dropped 11.9% year over year. The top line also missed the Zacks Consensus Estimate by 0.6%. According to the company, despite the headwinds caused by labor and contrast shortages, it reported sequential acceleration in sales.
Our fiscal fourth-quarter revenue estimate for CSII was $63.5 million.
Fiscal 2022 revenues were $236.2 million, down 8.8% from fiscal 2022.
For fiscal 2022, we projected revenues of $237.2 million.
Segment Details
In the quarter under review, worldwide coronary revenues decreased 13.4% year over year to $21.8 million.
We expected worldwide coronary revenues to be $19.9 million in fiscal Q4.
On a sequential basis, in the United States, coronary revenues increased 16%, led by 11% growth in units sold. Coronary support products increased 37%. Outside the United States, coronary revenues increased 14% sequentially, as a result of continued strength in Japan, combined with the successful launch of Coronary OAS in Europe.
Cardiovascular Systems, Inc. Price, Consensus and EPS Surprise
Worldwide peripheral revenues plunged 14.7% year over year in the quarter to $40.7 million.
Worldwide peripheral revenues in Q4 per our model were estimated to be $43.6 million.
On a sequential basis, fourth quarter worldwide peripheral revenues increased 9%. In the United States, peripheral franchise revenues increased 9%, led by a 27% increase in OBL revenue and a 1% increase in hospital revenues. U.S. peripheral revenues also benefited from a 36% increase in ISD revenues.
Margins
The gross margin in the reported quarter was 73.9%, up 304 basis points (bps) year over year on a 21.2% rise in the cost of goods sold.
We projected a gross margin of 73.4% for Q4.
Selling, general and administrative expenses rose 1.9% to $46.6 million. Research and development expenses reduced 5.1% to $8.8 million.
Adjusted operating expenses rose 0.7% to $55.4 million. Adjusted operating loss in the reported quarter was $9.1 million compared with an adjusted operating loss of $4.6 million in the year-ago period.
Financial Position
The company exited fiscal 2022 with cash and cash equivalents of $66.4 million compared with $71.1 million at the end of fiscal 2021.
2022 Guidance
Cardiovascular Systems’ management forecasts a revenue growth trend in fiscal 2023 with a gradual improvement in the state of the U.S. healthcare system combined with strong sales execution, accelerating revenues from the sale of interventional support devices, successful product introductions and international expansion.
Full-year revenues are expected in the band of $255 million to $265 million. The Zacks Consensus Estimate for the same is currently pegged at $257.9 million.
The company expects net loss in the range of 9% to 11% of revenues. The Zacks Consensus Estimate for the metric is pegged at a loss of 68 cents per share.
Our Take
Cardiovascular Systems’ fourth-quarter fiscal 2022 loss per share was wider than the year-ago figure and the consensus mark. Revenues too dropped year over year, missing the Zacks Consensus Estimate. The company’s domestic business was impacted by lower procedure volumes due to hospital capacity issues and staffing shortages. However, according to the company, strong sequential growth in each of its business segments was due to procedure recovery, focused commercial strategies and the launch of new products.
Gross margin in the quarter expanded favorably, impacted by a reduction in the estimated amount of older generation pumps that need to be replaced under the program established a year ago.
For fiscal 2023, Cardiovascular Systems anticipates full resolution of the imaging contrast shortage in September and a gradual improvement in U.S. hospital procedure volumes during the course of the year.
Zacks Rank and Key Picks
Cardiovascular Systems currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Quest Diagnostics Incorporated (DGX - Free Report) , Becton, Dickinson and Company (BDX - Free Report) , popularly known as BD, and Alkermes plc (ALKS - Free Report) .
Quest Diagnostics, carrying a Zacks Rank #2 (Buy), reported second-quarter 2022 adjusted EPS of $2.36, which beat the Zacks Consensus Estimate by 9.8%. Revenues of $2.45 billion outpaced the consensus mark by 7.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quest Diagnostics has an earnings yield of 6.9% compared with the industry’s 3.8%. DGX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average being 12.1%.
BD, having a Zacks Rank #2, reported third-quarter fiscal 2022 adjusted EPS of $2.66, which beat the Zacks Consensus Estimate by 6.8%. Revenues of $4.64 billion outpaced the consensus mark by 4%.
BD has an estimated long-term growth rate of 6.6%. BDX’s earnings surpassed estimates in all the trailing four quarters, the average being 11.9%.
Alkermes reported second-quarter 2022 adjusted EPS of 6 cents, which surpassed the Zacks Consensus Estimate by 50%. Second-quarter revenues of $276.2 million outpaced the Zacks Consensus Estimate by 1.1%. It currently has a Zacks Rank #2.
Alkermes has an estimated long-term growth rate of 24.9%. ALKS’s earnings surpassed estimates in all the trailing four quarters, the average being 325.5%.
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Cardiovascular Systems (CSII) Q4 Earnings, Revenues Miss Mark
Cardiovascular Systems, Inc. reported a loss of 25 cents per share for fourth-quarter fiscal 2022 compared with a loss of 14 cents in the prior-year period. The reported loss was wider than the Zacks Consensus Estimate of a loss of 22 cents.
Our projection of Q4 loss per share was 24 cents.
For the full year, the company reported a loss of 94 cents per share, which compared unfavorably with a loss of 35 cents per share in the year-ago period.
For the full fiscal, we project a loss per share of 94 cents.
Net Sales
Cardiovascular Systems’ revenues of $62.5 million dropped 11.9% year over year. The top line also missed the Zacks Consensus Estimate by 0.6%. According to the company, despite the headwinds caused by labor and contrast shortages, it reported sequential acceleration in sales.
Our fiscal fourth-quarter revenue estimate for CSII was $63.5 million.
Fiscal 2022 revenues were $236.2 million, down 8.8% from fiscal 2022.
For fiscal 2022, we projected revenues of $237.2 million.
Segment Details
In the quarter under review, worldwide coronary revenues decreased 13.4% year over year to $21.8 million.
We expected worldwide coronary revenues to be $19.9 million in fiscal Q4.
On a sequential basis, in the United States, coronary revenues increased 16%, led by 11% growth in units sold. Coronary support products increased 37%. Outside the United States, coronary revenues increased 14% sequentially, as a result of continued strength in Japan, combined with the successful launch of Coronary OAS in Europe.
Cardiovascular Systems, Inc. Price, Consensus and EPS Surprise
Cardiovascular Systems, Inc. price-consensus-eps-surprise-chart | Cardiovascular Systems, Inc. Quote
Worldwide peripheral revenues plunged 14.7% year over year in the quarter to $40.7 million.
Worldwide peripheral revenues in Q4 per our model were estimated to be $43.6 million.
On a sequential basis, fourth quarter worldwide peripheral revenues increased 9%. In the United States, peripheral franchise revenues increased 9%, led by a 27% increase in OBL revenue and a 1% increase in hospital revenues. U.S. peripheral revenues also benefited from a 36% increase in ISD revenues.
Margins
The gross margin in the reported quarter was 73.9%, up 304 basis points (bps) year over year on a 21.2% rise in the cost of goods sold.
We projected a gross margin of 73.4% for Q4.
Selling, general and administrative expenses rose 1.9% to $46.6 million. Research and development expenses reduced 5.1% to $8.8 million.
Adjusted operating expenses rose 0.7% to $55.4 million. Adjusted operating loss in the reported quarter was $9.1 million compared with an adjusted operating loss of $4.6 million in the year-ago period.
Financial Position
The company exited fiscal 2022 with cash and cash equivalents of $66.4 million compared with $71.1 million at the end of fiscal 2021.
2022 Guidance
Cardiovascular Systems’ management forecasts a revenue growth trend in fiscal 2023 with a gradual improvement in the state of the U.S. healthcare system combined with strong sales execution, accelerating revenues from the sale of interventional support devices, successful product introductions and international expansion.
Full-year revenues are expected in the band of $255 million to $265 million. The Zacks Consensus Estimate for the same is currently pegged at $257.9 million.
The company expects net loss in the range of 9% to 11% of revenues. The Zacks Consensus Estimate for the metric is pegged at a loss of 68 cents per share.
Our Take
Cardiovascular Systems’ fourth-quarter fiscal 2022 loss per share was wider than the year-ago figure and the consensus mark. Revenues too dropped year over year, missing the Zacks Consensus Estimate. The company’s domestic business was impacted by lower procedure volumes due to hospital capacity issues and staffing shortages. However, according to the company, strong sequential growth in each of its business segments was due to procedure recovery, focused commercial strategies and the launch of new products.
Gross margin in the quarter expanded favorably, impacted by a reduction in the estimated amount of older generation pumps that need to be replaced under the program established a year ago.
For fiscal 2023, Cardiovascular Systems anticipates full resolution of the imaging contrast shortage in September and a gradual improvement in U.S. hospital procedure volumes during the course of the year.
Zacks Rank and Key Picks
Cardiovascular Systems currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader medical space that have announced quarterly results are Quest Diagnostics Incorporated (DGX - Free Report) , Becton, Dickinson and Company (BDX - Free Report) , popularly known as BD, and Alkermes plc (ALKS - Free Report) .
Quest Diagnostics, carrying a Zacks Rank #2 (Buy), reported second-quarter 2022 adjusted EPS of $2.36, which beat the Zacks Consensus Estimate by 9.8%. Revenues of $2.45 billion outpaced the consensus mark by 7.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Quest Diagnostics has an earnings yield of 6.9% compared with the industry’s 3.8%. DGX’s earnings surpassed estimates in three of the trailing four quarters and missed the same in one, the average being 12.1%.
BD, having a Zacks Rank #2, reported third-quarter fiscal 2022 adjusted EPS of $2.66, which beat the Zacks Consensus Estimate by 6.8%. Revenues of $4.64 billion outpaced the consensus mark by 4%.
BD has an estimated long-term growth rate of 6.6%. BDX’s earnings surpassed estimates in all the trailing four quarters, the average being 11.9%.
Alkermes reported second-quarter 2022 adjusted EPS of 6 cents, which surpassed the Zacks Consensus Estimate by 50%. Second-quarter revenues of $276.2 million outpaced the Zacks Consensus Estimate by 1.1%. It currently has a Zacks Rank #2.
Alkermes has an estimated long-term growth rate of 24.9%. ALKS’s earnings surpassed estimates in all the trailing four quarters, the average being 325.5%.