STAAR Surgical Company

Hey, ladies and gentlemen. Thank you for standing by. Welcome to the Starr Surgical first quarter financial results conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the call will be open for questions. If you have questions, please press star followed by one on your touchstone phone. If you're using speaker equipment today, please lift handset before making your selection. this call is being recorded today wednesday may 5 2021 at this time i would like to turn the conference over to mr brian moore vice president investor media relations and corporate development for star surgical sir the floor is yours thank you operator and good afternoon everyone

Thank you for joining us on the Star Surgical Conference call this afternoon to discuss the company's financial results for the first quarter ended April 2nd, 2021. On the call today are Karen Mason, President and Chief Executive Officer, and Patrick Williams, Chief Financial Officer. The press release of our first quarter results was issued just after 4 p.m. Eastern time and is now available on Star's website at www.star.com. Before we begin, let me quickly remind you that during the course of this conference call, the company will make forward-looking statements. We caution you that any statement that is not a statement of historical fact is a forward-looking statement. This includes remarks about the company's projections, expectations, plans, beliefs, and prospects. These statements are based on judgment and analysis as of the date of this conference call and are subject to numerous important risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The risks and uncertainties with the forward-looking statements made in this conference call and webcast are described in the Safe Harbor Statement in today's press release, as well as stars public periodic filings with the SEC. Except as required by law, STAR seems no obligation to update these forward-looking statements to reflect future events or actual outcomes and does not intend to do so. In addition, to supplement the GAAP numbers, we have provided non-GAAP adjusted net income and adjusted earnings per share and sales in constant currency. We believe that these non-GAAP numbers provide meaningful supplemental information and are helpful in assessing our historical and future performance. A table reconciling the GAAP information to the non-GAAP information is included in today's press release. Following our prepared remarks, we will open the line to questions from publishing analysts. We ask analysts limit themselves to two initial questions then recue with any follow-ups. We thank everyone in advance for their cooperation with this process. And with that, I would now like to turn the call over to Karen Mason, President and CEO of STAR.

Thank you, Brian. Good afternoon, everyone, and thank you for joining us on today's call. The record results for the first quarter of 2021 demonstrate that the promise for a lens-based future of refractive vision correction is accelerating, led by STAR's EvoVision family of implantable columnar lenses. STAR's imperatives around search and training and partnership, clinical support, and extraordinary customer outreach continue to be the underpinnings of our excellent results. We achieve strong and significant ICL unit growth globally, including China of 63%, Japan of 72%, South Korea of 29%, Asia-Pacific distributor markets of 63%, India of 67%, Spain of 42%, Germany of 48%, European distributor markets of 54%, and the U.S. up 46%, all as compared to the prior year quarter. All told, global ICO unit growth for the first quarter of 2021 was up 54% year over year. Strong ICO unit growth drove company net sales growth of 44% year over year to 50.8 million in the first quarter of 2021. This impressive level of growth exceeds the aggressive 2020 to 2022 three-year plan growth we outlined for you in November 2019 for year two of the plan. We are pleased to report that our sales momentum is accelerating in 2021, as we are successfully addressing the unique and large addressable market opportunity for our EvoVisian ICL family of lenses. Starr's track record as the fastest growing U.S. publicly traded ophthalmology company also continues. The underpinnings of our success are the delighted patients who achieve visual freedom with our lenses, broadening support from the refractive surgeon community as the patient satisfaction and wow factor expressed by patients is a significant win for our surgeon partners and their staff. This positive outcome is supported by effective direct-to-consumer outreach that resonates with patients seeking to free themselves from the hassles of glasses and contact lenses. Our direct-to-consumer multifaceted communications are designed to build awareness of our EvoVision ICL family of lenses, highlighting the advantages of our lenses and differentiating our premium lenses from other refractive options. Our goals are to drive patients to surgeon offices, build surgeon and patient preference for our lenses, and win refractive vision correction market share. Last month in Japan, we kicked off an exciting new advertising campaign featuring Japanese celebrity Mayoko Kawakita, who will be featured in ICL digital banner ads, YouTube video ads, social media ads on Instagram and Twitter, and train advertising on routes through Tokyo, Nagoya, and other major routes most frequented by our target audience. Mayoko is a celebrity active in TV and fashion in Japan who has achieved visual freedom through ICLs and is our newest ICL brand ambassador. Mayoko is typically on local TV every few days in Japan and has over 1.6 million followers on Instagram. I must say that part of the excitement at Star is being an internationally immersed company as we build our direct-to-consumer campaigns to be suited specifically for local taste and patient decision-making. Patient education information has taken over the homepage of a dedicated ICL consumer website in Japan as part of a campaign featuring MayoCo. The link to the consumer website is provided in my quote in today's earnings press release. Investors and analysts may also view videos from the campaign launch on the global consumer marketing section of our investor website at investors.star.com. The videos are informative and entertaining. At one point during the video, viewers will see Mayoko's old glasses, old contact lenses case, and old eye drops animated and trying to get her attention. because she's no longer using them. In response, Mayoko smiles and points to her ICLs and the visual freedom that she now enjoys. New and exciting advertising campaigns will also be starting in other major global markets in the coming weeks and months, featuring celebrity EvoVision ICL brand ambassadors who are delighted with her ICLs. Turning to our near-term pipeline of new product introductions, we are continuing the controlled rollout of our EvoViva presbyopia lenses in Europe, adding surgeons and refining the EvoViva playbook of best practices that we will share with certified surgeons. The EvoViva lens is designed to delight the early presbyope, ages 45 to 55, seeking visual freedom at near, intermediate, and far distances. We continue to plan for an expansive commercial kickoff of our EvoViva lens when we can run an in-person event in our experts meeting format in Europe. We have not solidified a date yet as society meetings continue to push back virtual and in-person hybrid meetings, let alone all in-person meetings. We should know more by summer. In late April, the FDA received our clinical data for our EVO family of myopia lenses with the goal of bringing EVO to the US market later this year. We will provide an update on the status of our submission when appropriate and permitted. The US, as the number two market in the world for refractive procedures, is a market where we have been laying the groundwork for our EVO family of lenses for some time. Our work in further preparing the U.S. market for our breakthrough evil family of lenses began with the initial rounds of hiring of key North America personnel. As the leadership expanded, so did the quality and quantity of exceptional ophthalmology experienced commercial executives. Our outreach also included our inaugural U.S. Surgeon's Council meeting where we hosted dozens of U.S. surgeons and ophthalmic business leaders to hear about the successful integration of evil lenses and practices outside the U.S. in markets such as China, Japan, and Europe. Since 2019, we have signed dozens of alliance agreements. In 2020, in response to COVID, we introduced a program to build ICL awareness and volumes in the U.S., while also enhancing surgeon economics. Refractive ReLook is STAR-USA's latest promotion. Refractive ReLook encourages ICL surgeons to take another look at their Vivian ICL prescription patterns and encourages surgeons to use more lenses down the diopter curve between minus 3 and minus 8 diopters. As a result, we are pleased to report terrific ICL unit growth for the first quarter of 2021, up 46% in the U.S. year over year. Pending FDA approval, we look forward to introducing our EVO lenses to the U.S. market in the fourth quarter of this year. Given the momentum in our business and increased visibility in our key markets, we are today able to introduce the top line sales outlook. For the full year, fiscal 2021, we anticipate net sales of approximately $215 million to $217 million, which represents a robust growth rate that exceeds 30% year over year, even taking into account the strong performance in the second half of 2020. I will now turn the call over to Patrick to discuss our financial performance in more detail. Patrick?