LeMaitre Vascular, Inc.

Welcome to the Lomate Vascular Q1 2022 Financial Results Conference Call. As a reminder, today's call is being recorded. At this time, I would like to turn the call over to Mr. J.J. Pellegrino, Chief Financial Officer of Lomate Vascular. Please go ahead, sir.

Good afternoon, and thank you for joining us on our Q1 2022 Conference Call. With me on today's call are our Chairman and CEO, George LeMaitre, and our President, Dave Roberts. Before we begin, I'll read our safe harbor statement. Today, we will make some forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, the accuracy of which is subject to risks and uncertainties. Wherever possible, we will try to identify those forward-looking statements by our using words such as believe, expect, anticipate, pursue, forecast, and similar expressions. Our forward-looking statements are based on our estimates and assumptions as of today, April 28, 2022, and should not be relied upon as representing our estimates or views on any subsequent date. Please refer to the cautionary statement regarding forward-looking information and the risk factors in our most recent 10-K and subsequent SEC filings, including disclosure of the factors that could cause results to differ materially from those expressed or implied. During this call, we will discuss non-GAAP financial measures, which include organic sales growth, as well as operating income and EPS, excluding special charges. A reconciliation of GAAP to non-GAAP measures discussed in this call is contained in the associated press release and is available in the investor relations section of our website, www.lemate.com. I'll now turn the call over to George Lemaitre.

Thanks, JJ. On today's call, I'll cover four topics. Q1 organic sales growth of 13%, continued sales force growth to 112 reps, going direct in Korea, and the stronger U.S. dollar. Sales were 39.6 million in Q1, a 13% organic increase versus the year-ago quarter. All three regions posted double-digit organic growth. The Americas 12%, EMEA 13%, and APAC 15%. Due to Omicron's February improvement, the Q1 sales ramp was steep, $10.7 million in January, $13 million in February, and a record $15.9 million in March. Autographed and Zenasher once again led growth in both posted record quarters. Autographed was up 18% to $6.9 million in Q1 as that acquisition continues to outperform expectations. Zenasher bounced in Europe, and Japanese sales growth continued. Karata Chunts, Allografts and valvetomes also contributed to Q1 growth. Notably, we sold our first Allograft in Europe as that product received UK approval in March. We've also begun the application process for German Allograft approval. We've built our sales force back to match our pre-COVID high watermark of 112 reps. This 30% year-over-year rep increase may have helped Q1, but will certainly be a tailwind going forward. and we're hiring reps in 14 more cities, mostly in the U.S. and Europe. We should have approximately 120 reps by December. We're also growing our presence in Asia. In April, we agreed to buy out our Korean distributor for $540,000, and we signed a five-year office warehouse lease in Seoul. Last year, Jesang bought $800,000 worth of devices from Omate and sold them to Korean hospitals for approximately $1.6 million. We should be selling directly to Korean hospitals by January of next year. In the last three quarters of 2022, sales to the Korean distributor should be slow, and we anticipate approximately $300,000 of operating expenses associated with our Seoul office. The new Seoul location is LaMate's 12th worldwide sales office, and Korea will become LaMate's 25th direct-to-hospital country. On a different note, recent foreign exchange movements are causing a markdown in our sales and op income estimates for full year 2022. The strengthening of the U.S. dollar since our February 24th earnings call is expected to reduce full year sales by $3 million. The same issue impacts the bottom line, reducing operating income by $1.6 million. Despite these currency swings, the fundamentals of LeMaitre's business remain unchanged from two months ago. Indeed, full year 2022 organic sales growth is increasing slightly in today's guidance to 8.2% from 7.5% in the February 24th guidance. Before turning the call over to JJ, I'd also like to mention that in March, Lemaitre joined the NASDAQ U.S. Broad Dividend Achievers Index. This index is comprised of 373 public U.S. companies which have increased their dividends for at least 10 straight years. Our inclusion in the index underscores our longstanding focus on profitability and returning shareholder capital. I'll now turn the call over to JJ.