RTI Surgical Posts First-Quarter Gains

Alachua, Fla.-based RTI Surgical Inc. posted first-quarter revenue of $68 million for the first quarter of 2015 (ended March 31) compared to $60.7 million for the same period last year. Domestic revenues were $62.7 million compared to $54.8 million. International revenues were $5.3 million compared to $5.9 million for the first quarter of 2014. On a constant currency basis, international revenues for the first quarter of 2015 increased 1 percent compared to the first quarter of 2014. For the first quarter of 2015, the company benefited from $1.5 million in accelerated deferred revenue recognition due to loss of exclusivity by its commercial partner in the breast reconstruction market.

“We saw solid growth in the first quarter, exceeding our expectations and keeping us on track for the year,” said Brian K. Hutchison, president and CEO. “Our growth was in line with the plan we laid out for our three major areas of focus, mentioned on our fourth quarter and year-end earnings call. Our base biologics business, which includes allograft and xenograft implants was comparable to prior year. Our hardware business, which includes metals and synthetic-based implants, grew 30 percent and our focused products, which includes nanOss advanced bone graft substitute, Fortiva porcine dermis and map3 cellular allogeneic bone graft, grew more than 100 percent.”

For the first quarter, the company reported net income of $2.9 million and net income per fully diluted common share of 5 cents, compared to net loss of $3.1 million and net loss per fully diluted common share of 5 cents for the first quarter of 2014.

Adjusted earnings before interest, taxes, depreciation and amortization was $10.7 million (16 percent of first quarter 2015 revenues) compared to $6.4 million for the first quarter of 2014 (10 percent of first quarter 2014 revenues).

Based on results from the first quarter, the company is raising full year guidance for 2015. The company now expects full year revenues for 2015 to be between $281 million and $286 million, as compared to prior guidance of between $279 million and $285 million. Full-year net income per fully diluted common share is expected to be in the range of 19-23 cents based on 58.2 million fully diluted common shares outstanding, as compared to prior guidance of 17-22 cents.

“During the first quarter we saw strong growth in our direct distribution business,” said Hutchison. “Based on results from the first quarter, I am confident in our ability to meet our goals for the year. We will continue to target our key initiatives including driving growth in our focused products, capturing market share in spine hardware, growing international revenue and controlling spending to improve margins.”

RTI Surgical makes biologic, metal and synthetic implants used in sports medicine, general surgery, spine, orthopedic, trauma and cardiothoracic procedures.