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Orthofix posted 3Q17 revenue of US $105.2MM, +6.9% from 3Q16, and YTD revenue of $316.9MM, +5.2% vs. the prior year. With revenue growing sequentially throughout 2017, the company has increased its full-year guidance for a second time—updating the range to $428MM to $431MM, from $422MM to $425MM.
| 3Q17 | 3Q16 | $ Change | % Change | |
| Trauma | $25.4 | $24.3 | $1.1 | 4.7% |
| Spine | $20.2 | $16.9 | $3.3 | 19.3% |
| Orthobiologics | $15.2 | $14.3 | $0.9 | 6.2% |
| Other* | $44.4 | $43.0 | $1.5 | 3.4% |
| Total | $105.2 | $98.5 | $6.8 | 6.9% |
| 9Mo17 | 9Mo16 | $ Change | % Change | |
| Trauma | $74.1 | $75.8 | -$1.7 | -2.2% |
| Spine | $60.8 | $54.0 | $6.8 | 12.6% |
| Orthobiologics | $45.9 | $42.7 | $3.2 | 7.5% |
| Other* | $136.1 | $128.8 | $7.4 | 5.7% |
| Total | $316.9 | $301.3 | $15.7 | 5.2% |
*BioStim
This second guidance increase was accomplished even with headwinds from restructuring in ExFix, discontinuation of a non-core business and weather-related disruptions.
Of four business units, BioStim was the most affected by hurricanes; its growth would have been 5% rather than 3.4%. The other units have far smaller businesses in the impacted regions.
That said, OFIX plans for little to no sales in Puerto Rico for up to six quarters, at a loss of ~$500,000 per quarter, including 4Q17.
Biologics and spine led growth for the quarter and year-to-date. Biologics was supported by Trinity Elite sales and enhancements to the salesforce that backs it up. Spine’s performance was attributed to products introduced over the last 18 months (including the CETRA Anterior Cervical Plate), new distribution partners and improved engagement of legacy sales staff. The next big launch in spine will be FORZA XP expandable interbody devices, which has been pushed from 4Q17 to 1Q18.
“Twenty-five percent of our [spine] sales in the quarter came from products that were released within the last 24 months.” –Brad Mason, President and Chief Executive Officer, Orthofix
Trauma sales continue to benefit from TL-HEX and U.S. limited launch of the RIVAL foot/ankle internal fixation system. By year-end, OFIX will complete a restructuring in this segment, as well as the closure of a non-core business in the U.K. Further, certain manufacturing will move from the U.K. to Italy, and a transition from direct to stocking distributors in Puerto Rico and Brazil will lead to a reduction in force.
Finally, leadership affirmed a formal notice that the company fully satisfied terms of its 5-year Corporate Integrity Agreement, and per the Office of Inspector General, the agreement is concluded. This pertained to criminal and civil matters related to the bone growth stimulation business.
Source: Orthofix International N.V.
Orthofix posted 3Q17 revenue of US $105.2MM, +6.9% from 3Q16, and YTD revenue of $316.9MM, +5.2% vs. the prior year. With revenue growing sequentially throughout 2017, the company has increased its full-year guidance for a second time—updating the range to $428MM to $431MM, from $422MM to $425MM.
Q17 ...
Orthofix posted 3Q17 revenue of US $105.2MM, +6.9% from 3Q16, and YTD revenue of $316.9MM, +5.2% vs. the prior year. With revenue growing sequentially throughout 2017, the company has increased its full-year guidance for a second time—updating the range to $428MM to $431MM, from $422MM to $425MM.
| 3Q17 | 3Q16 | $ Change | % Change | |
| Trauma | $25.4 | $24.3 | $1.1 | 4.7% |
| Spine | $20.2 | $16.9 | $3.3 | 19.3% |
| Orthobiologics | $15.2 | $14.3 | $0.9 | 6.2% |
| Other* | $44.4 | $43.0 | $1.5 | 3.4% |
| Total | $105.2 | $98.5 | $6.8 | 6.9% |
| 9Mo17 | 9Mo16 | $ Change | % Change | |
| Trauma | $74.1 | $75.8 | -$1.7 | -2.2% |
| Spine | $60.8 | $54.0 | $6.8 | 12.6% |
| Orthobiologics | $45.9 | $42.7 | $3.2 | 7.5% |
| Other* | $136.1 | $128.8 | $7.4 | 5.7% |
| Total | $316.9 | $301.3 | $15.7 | 5.2% |
*BioStim
This second guidance increase was accomplished even with headwinds from restructuring in ExFix, discontinuation of a non-core business and weather-related disruptions.
Of four business units, BioStim was the most affected by hurricanes; its growth would have been 5% rather than 3.4%. The other units have far smaller businesses in the impacted regions.
That said, OFIX plans for little to no sales in Puerto Rico for up to six quarters, at a loss of ~$500,000 per quarter, including 4Q17.
Biologics and spine led growth for the quarter and year-to-date. Biologics was supported by Trinity Elite sales and enhancements to the salesforce that backs it up. Spine’s performance was attributed to products introduced over the last 18 months (including the CETRA Anterior Cervical Plate), new distribution partners and improved engagement of legacy sales staff. The next big launch in spine will be FORZA XP expandable interbody devices, which has been pushed from 4Q17 to 1Q18.
“Twenty-five percent of our [spine] sales in the quarter came from products that were released within the last 24 months.” –Brad Mason, President and Chief Executive Officer, Orthofix
Trauma sales continue to benefit from TL-HEX and U.S. limited launch of the RIVAL foot/ankle internal fixation system. By year-end, OFIX will complete a restructuring in this segment, as well as the closure of a non-core business in the U.K. Further, certain manufacturing will move from the U.K. to Italy, and a transition from direct to stocking distributors in Puerto Rico and Brazil will lead to a reduction in force.
Finally, leadership affirmed a formal notice that the company fully satisfied terms of its 5-year Corporate Integrity Agreement, and per the Office of Inspector General, the agreement is concluded. This pertained to criminal and civil matters related to the bone growth stimulation business.
Source: Orthofix International N.V.
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JV
Julie Vetalice is ORTHOWORLD's Editorial Assistant. She has covered the orthopedic industry for over 20 years, having joined the company in 1999.
