Abiomed (ABMD +0.00%), a maker of minimally invasive heart pumps, reported its fiscal first-quarter results on Thursday. The fast-growing medical device company posted overall revenue growth of 36%. The bottom line grew at a triple-digit rate thanks to favorable changes to the tax code.
Let's examine the results for a better idea of where this company is heading:
Image source: Getty Images.
Abiomed's fiscal first quarter: The raw numbers
|
Metric |
Q1 2019 |
Q1 2018 |
Year-Over-Year Change |
|---|---|---|---|
|
Revenue |
$180 million |
$132.5 million |
36% |
|
GAAP net income |
$90.1 million |
$37.4 million |
141% |
|
Earnings per share |
$1.95 |
$0.82 |
138% |
Data source: Abiomed.
What happened with Abiomed this quarter?
- Sales of Impella heart pumps increased 37% to $173.7 million. The growth was driven by a 32% jump in the U.S. and a 75% increase in international markets.
- The reorder rate in the U.S. was 100%.
- Gross margin dipped 60 basis points. The slight decline was blamed on product and geographic mix. Management also stated that it is making investments in its manufacturing capabilities to support continued growth.
- The sales leverage allowed the operating margin to expand 100 basis points to 26%.
- GAAP net income was boosted by a tax benefit of $53.8 million, or $1.17 per share. Stripping out that artificial jump would have resulted in GAAP net income of $36.3 million, or $0.78 per share. That would have been down slightly compared to the year-ago period.
- Cash balance at quarter end was $367.4 million.
- Abiomed reported that it had received regulatory approval for the Impella 2.5 and Impella 5.0 in India.
What management had to say
CEO Michael Minogue boasted that it was a strong start to the fiscal year and shared the company's goals for the year ahead:
Abiomed is committed to sustainable growth and improving patient outcomes each quarter. We do this through advanced training, product enhancements, and sharing of best practices derived from real-world experience. We have maintained our disciplined execution on our strategic goals and increased manufacturing capacity, while expanding Impella adoption with new products, new indications, and new geographies.
Looking forward
CFO Todd Trapp reminded investors that the fiscal second quarter is a seasonally slow period for the business due to the timing of surgeon vacations. As a result, the company expects that revenue in the upcoming quarter will be slightly below the first quarter.
However, the strong start to the year allowed management to favorably tweak its full-year guidance. Management boosted the lower end of its guidance range by $15 million. The new range is $755 million and $770 million, which represents growth of 27% to 30% year over year.
Management also reaffirmed that it continues to target an operating margin range of 28% to 30% for the full fiscal year.
CEO Minogue closed out his remarks on the conference call with investors by restating that the company remains in great shape to continue creating shareholder value: "We are on track to create the field of heart recovery as we penetrate the U.S. market and become the global standard of care over time. We believe our focus on sustainable growth with improving clinical outcomes will enable us to remain one of the fastest-growing GAAP-profitable med tech companies with a strong balance sheet and extensive intellectual property portfolio."
