Aurora Spine Corporation

Good morning, and welcome to the Aurora Spine Report's fourth quarter and fiscal year 2021 financial results call. All participants will be in listen-only mode. Should you need assistance, please signal conference questions by pressing the start key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may first start it on your telephone keypad. To withdraw a question, please press start and two. Please note this event is being recorded. I will now turn the conference over to Adam Lowensteiner. with Listen Partners. You may now go ahead.

Thank you, Anthony, and good morning, everyone, and thank you all for joining us today to review the financial results for Aurora Spine for the fourth quarter and year-end ended December 31st, 2021. With us on the call representing the company today are Trent Northcutt, President and CEO of Aurora Spine, and Chad Klaus, Chief Financial Officer of Aurora Spine. Before I begin, I would like to remind everyone that statements made during the course of this call may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Act of 1934. These statements reflect current expectations concerning future events and results. Words such as expect, intend, believe, may, will, could, should, anticipate, and similar expressions are words that are used to identify forward-looking statements, but their absence does not mean a statement is not forward-looking. These statements are not guarantees of future performance and are subject to risks and uncertainties and other important factors that could cause actual performance or achievements to be material different from those projected. For full discussion of these risks, uncertainties, and factors, you are encouraged to read Aurora Spine's documents. on file with CDAR, including those set forth in the periodic reports filed under the forward-looking statements and risk factors section. Aurora Spine does not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. On this call, management may refer to adjusted EBITDA, adjusted net income, and adjusted EPS, which are not measures of financial performance under generally accepted accounting principles or GAAP. Management believes that these non-GAAP figures, in addition to other GAAP measures, provide meaningful supplemental information regarding the company's operational performance. Investors should not recognize that these non-GAAP figures might not be comparable to similarly titled measures of other companies. These measures should not be considered in addition to and not as a substitute for or superior to any measure of performance prepared in accordance with GAAP. A reconciliation of non-GAAP measures to the most directly comparable GAAP measures in accordance with SEC Regulation G can be found on the company's earnings. With that, I'd like to now turn over the call to Mr. Trent Northup, President and Chief Executive Officer of Aurora Spine. Trent, please proceed.

Thank you, Adam. I appreciate everyone today, and I'd like to welcome everyone to the Aurora Fourth Quarter 2021 Financial Results Conference Call. Earlier today, we issued a press release detailing our financial results. Hopefully, you've had a chance to review this news. But if not, a copy can be found on our website at auroraspine.com. That's aurora-spine.com under our investor relations section or in our other financial websites. To lay out the agenda of today's call, let me first summarize a few key events of the quarter. including some of the brief commentary on the numbers. And then I'd like to talk a bit about the status of each of our key initiatives and products, like the silo and the zip, as well as our initiatives on the spine division, including our new DEXA product line. Chad Klaus, our CFO, will join us to recap the financial results, and we will then conduct a Q&A session at the end. Key events in Q1, the market overview dynamics of our new products and our clinical study, Overall, fourth quarter produced a solid result and demonstrated that the issues and experience of the COVID-19 have now started to go behind us. While there were still little bits and pockets of surgery cancellations here and there, overall, our business didn't experience any industry slowdowns in the quarter like some of the other companies in our industry. And Aurora actually surpassed the pre-COVID level revenue levels and showed growth year over year as well as significant sequential growth improvement from the third quarter. In addition, the fiscal 2022, while starting slow, has gained momentum and off to a solid start. So what's going on? The phenomenon that we believe unfolding in front of us is a multitude. First, coming out of the COVID, more patients were focused on their health and feeling confident and coming back to the doctor's office. Doctors, in fact, were actually letting people come back into their offices. taking care of health issues, and they postponed because of the pandemic. Also, doctors adopted a pandemic protocol. Many of them shifted towards concluding their own procedures, either in the office or at the surgery centers to serve more patients. We saw a big boom in the surgery center business. In the timely fashion, this has also shown doctors to pursue new technology, especially those we found in patients that improved outcomes and done in minimally invasive manner, that also enable the patient to return home in the same day. Another catalyst is this continued emergency in the pain interventional market, which continues to evolve in a sizable manner as doctors are incorporating pain management into their practices. These doctors are also very mindful of the opioid crisis and need devices that can be highly effective, included in a minimally invasive manner that helps treat the patients without using addictive pain medications. Two of Aurora's proprietary products, the Zip and the Silo, are exactly what doctors are looking for. During the quarter, the fiscal year for that matter, we work diligently focusing on proprietary products to continue to focus on the doctor education. Through our cadaver lab trainings, which are done in various cities throughout the United States, it allows 20 doctors or more to learn about Aurora's products, especially on the Zip and on the Silo. We trained over 200 doctors in 2021, and have created an aggressive training program scheduled for 2022. We should basically double what we did this past year and train more than 400 doctors in 2022, and we're well on our way at meeting that goal this year. We also embarked on a clinical trial for the Zip, which is going very well and has attracted many new doctors to utilize the device, join our study, and have embraced this new incorporated device into their practice and now incorporated many different procedures for that particular surgery center, hospital, or doctor practice. Our SI joint device has been a key contributor recently, and we believe it has a very positive future ahead. As the SI joint procedure continues to be adopted by doctors, we are continuing to educate doctors on the silo we are very excited about. our next generation device, which will be a titanium and non-allograft version or non-bone version called the Silo TFX. What's unique about this device is that this device is actually specifically designed for the SI joint and it is made in a minimally invasive approach where the doctor can have controlled precision of the instruments and allow this implant to be placed into the SI joint and instantly give the patient SI joint pain relief, and the patient can walk into the surgery center that day and actually leave the same day and will walk out of the surgery center. This is a step in the right direction, and again, reducing that opioid concern. Other area we have advanced during the quarter is our DEXA technology platform. This has been very exciting for us. We have secured a key patent in a patent called DEXA Technology last year, and we hit the ground running creating our DEXA product, DEXA-C cervical implant that was attained by the FDA clearance during the third quarter. This patented technology allows us to create a series of implants, manufacturing varied densities in order to help match that patient's bone density and DEXA-T score. We would employ the superior fixation to help promote a quicker bone growth and bone healing. We are now working towards marketing this product and conduct initial surgeries into the patients earlier this year. These procedures have gone very smoothly and we've had some initial traction with doctors starting to incorporate the DEXA-C into their practice. What's unique about this device is that it actually works with the summary of the patient's bone density. The density is a true measurement in how a patient's bone health and how the patient's performance in a recovery surgery based upon implants that are placed in this patient. The fact is that most, if not all, implants that are made for your cervical, for your lumbar, and other joints aspect to your body, but specifically to our company, Spine, all implants are manufactured and actually made to the same density. A healthy patient, a non-healthy patient, or a patient that has some variance in their bones. We believe that DEXA technology is that perfect procedure, that perfect product for the doctor to actually select it and dial it in to make sure that it works right within that patient's bone score and have a measurable and an outcome that gives positive clinical results to that patient, to that doctor. To summarize, I'm extremely proud of what the team performance was, staying focused on building those companies. We are well positioned to take advantage of the growth markets, and several of our new key proprietary products will remain focused on penetrating these markets further this year through continued training, successions, and also clinical result trials that are ongoing. Looking to the longer term, we are well positioned for success, especially as new products and more clinical studies proving out our technologies and teaching more doctors to use the Aurora product. Good news is that the pandemic is mostly behind us. Surgeries have returned and patients are focused on improving their health and well-being. We will now turn the call over to Chad Klaus, our CFO at Aurora Spine. He will review the fourth quarter financial results. Chad, please proceed.