LeMaitre Vascular, Inc.

Welcome to the LeMaitre Vascular Q1 2023 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 LeMaitre Vascular. Please go ahead.

Thank you, Operator. Good afternoon, and thank you for joining us on our Q1 2023 Conference Call. With me on today's call is 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 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, May 2nd, 2023, 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, operating expense, 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.lenate.com. I'll now turn the call over to George Lenate.

George Lenate Thanks, JJ. Sales grew 22% organically in Q1, 13% price, and 9% units. Our five largest product lines led the way. Validatomes were up 29%, carotid patches increased 17%, bovine grafts 22%, allografts 42%, and carotid shunts 18%. By geography, all three regions reported growth. The Americas were up 21%, EMEA was up 17%, and APAC was up 6%. At least on the Q1 sales line, it felt like we were in a new movie, everything, everywhere, all at once. The growth was partially driven by the improving macro environment you've already heard about. Procedure volumes increased in Q1 as hospitals staffed up their ORs to pre-COVID levels. But we also saw growth from three LAMATE-specific items, pricing, a larger sales force, and competitor stumbles. In Q1, we realized a 13% price increase, largely from our domestic valvetomes and European shunts. We also had 128 sales reps on March 31st, 14% more than we did a year ago. And we plan to end the year with 135 to 140 reps. And finally, in Q1, we benefited from competitor stumbles, which came in two flavors, backorders and abandoned European MDR approvals. While many of the backorders have resolved, Several competitors have withdrawn their products from Europe due to the high costs of gaining next-gen CE marketing. I'd now like to give an update on our continued expansion efforts in Asia-Pac. Our new office in Seoul is up and running. Korea sales are trending above previous expectations, and we should post the 2023 top line of $1.5 million. This is about double the historical sales volume to the ex-Korean distributor. This subsidiary should also turn a small profit in 2023. Additionally, we recently agreed to buy out our Thai distributor and plan to begin selling directly to Thai hospitals in Q3. This will be our 29th direct market. In other APAC-related news, in Q3, we expect to receive Japanese approval for an additional Xenosure indication for use in the carotid artery. Our Q1 annual run rate for Xenosure in Japan is $1.9 million. so this additional indication could be meaningful. Currently, our Japanese sales force market Xenosure only for use in the femoral artery, whereas worldwide usage of Xenosure is typically in the carotid artery. With that, I'll turn it over to Dave.