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OrthoPediatrics reported 4Q20 orthopedic revenue of USD $18.9 million, -0.1% vs. 4Q19 with full-year 2020 revenue of $71.1 million, -2% vs. 2019. Sales in the quarter were impacted by the company’s repurchase of inventory from a European stocking distributor that converted to a sales agency. The accounting move decreased revenue for the fourth quarter by -14% and -4% for the full year. OrthoPediatrics leadership pointed to 4Q20 U.S. sales growth of +26% as indicative the business’ underlying strength.
Part of that strength comes from synergies realized by the company from its recent acquisitions of Orthex, ApiFix and Telos. Orthex delivered 38 surgeon conversions in 2020 and expands OrthoPediatrics’ trauma and deformity addressable market by 20%.
For 2021, the company expects revenue between $93 million (+31% vs. 2020) and $98 million (+38%). Additionally, David Bailey will succeed Mark Thordahl as CEO. Mr. Throdahl will become the Executive Chairman of the Board and remain active in investor relations, strategy development and field travel.
“Working with our auditors, we determined that the correct accounting treatment in light of the new revenue recognition guidelines, ASC 606, required us to book this as a revenue reduction in December of 2020. This situation is a bit unique, in that this is a large stocking distributor for us, unlike some of our other smaller, independent family-owned businesses. They’re probably doing about $2 million a year of annualized sales today.” – Fred Hite, OrthoPediatrics CFO
Revenue Data
All revenue data is provided in USD millions unless otherwise noted. Sales and growth rates are estimated on an as-reported basis.
Segment Sales
| 4Q20 | 4Q19 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $6.6 | $4.9 | $1.7 | 35.7% |
| Trauma | $11.3 | $13.6 | ($2.4) | (17.3%) |
| Sports Medicine | $1.0 | $0.4 | $0.6 | 134.9% |
| Total | $18.9 | $19.0 | ($0.0) | (0.1%) |
| FY20 | FY19 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $20.7 | $21.5 | ($0.7) | (3.5%) |
| Trauma | $47.7 | $49.4 | ($1.7) | (3.4%) |
| Sports Medicine | $2.7 | $1.7 | $1.0 | 57% |
| Total | $71.1 | $72.6 | ($1.5) | (2%) |
Geographic Sales
| 4Q20 | 4Q19 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $17.9 | $14.2 | $3.7 | 26.1% |
| OUS | $1.1 | $4.8 | ($3.7) | (77.7%) |
| Total | $18.9 | $19.0 | ($0.0) | (0.1%) |
| FY20 | FY19 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $63.0 | $55.1 | $7.9 | 14.4% |
| OUS | $8.1 | $17.5 | ($9.4) | (53.6%) |
| Total | $71.1 | $72.6 | ($1.5) | (2%) |
Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $18.9 | |
| Cost of Sales | $3.8 | 20.1% |
| General and Admin | $9.4 | 49.8% |
| Selling and Marketing | $10.0 | 53% |
| R & D | $2.1 | 10.8% |
| Other | $17.0 | 90.1% |
| Net Earnings | ($14.0) | (74%) |
Mike Evers is ORTHOWORLD’s Digital Content Strategist. He can be reached by email.
OrthoPediatrics reported 4Q20 orthopedic revenue of USD $18.9 million, -0.1% vs. 4Q19 with full-year 2020 revenue of $71.1 million, -2% vs. 2019. Sales in the quarter were impacted by the company’s repurchase of inventory from a European stocking distributor that converted to a sales agency. The accounting move decreased revenue for the...
OrthoPediatrics reported 4Q20 orthopedic revenue of USD $18.9 million, -0.1% vs. 4Q19 with full-year 2020 revenue of $71.1 million, -2% vs. 2019. Sales in the quarter were impacted by the company’s repurchase of inventory from a European stocking distributor that converted to a sales agency. The accounting move decreased revenue for the fourth quarter by -14% and -4% for the full year. OrthoPediatrics leadership pointed to 4Q20 U.S. sales growth of +26% as indicative the business’ underlying strength.
Part of that strength comes from synergies realized by the company from its recent acquisitions of Orthex, ApiFix and Telos. Orthex delivered 38 surgeon conversions in 2020 and expands OrthoPediatrics’ trauma and deformity addressable market by 20%.
For 2021, the company expects revenue between $93 million (+31% vs. 2020) and $98 million (+38%). Additionally, David Bailey will succeed Mark Thordahl as CEO. Mr. Throdahl will become the Executive Chairman of the Board and remain active in investor relations, strategy development and field travel.
“Working with our auditors, we determined that the correct accounting treatment in light of the new revenue recognition guidelines, ASC 606, required us to book this as a revenue reduction in December of 2020. This situation is a bit unique, in that this is a large stocking distributor for us, unlike some of our other smaller, independent family-owned businesses. They’re probably doing about $2 million a year of annualized sales today.” – Fred Hite, OrthoPediatrics CFO
Revenue Data
All revenue data is provided in USD millions unless otherwise noted. Sales and growth rates are estimated on an as-reported basis.
Segment Sales
| 4Q20 | 4Q19 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $6.6 | $4.9 | $1.7 | 35.7% |
| Trauma | $11.3 | $13.6 | ($2.4) | (17.3%) |
| Sports Medicine | $1.0 | $0.4 | $0.6 | 134.9% |
| Total | $18.9 | $19.0 | ($0.0) | (0.1%) |
| FY20 | FY19 | $ Chg | % Chg | |
|---|---|---|---|---|
| Spine | $20.7 | $21.5 | ($0.7) | (3.5%) |
| Trauma | $47.7 | $49.4 | ($1.7) | (3.4%) |
| Sports Medicine | $2.7 | $1.7 | $1.0 | 57% |
| Total | $71.1 | $72.6 | ($1.5) | (2%) |
Geographic Sales
| 4Q20 | 4Q19 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $17.9 | $14.2 | $3.7 | 26.1% |
| OUS | $1.1 | $4.8 | ($3.7) | (77.7%) |
| Total | $18.9 | $19.0 | ($0.0) | (0.1%) |
| FY20 | FY19 | $ Chg | % Chg | |
|---|---|---|---|---|
| US | $63.0 | $55.1 | $7.9 | 14.4% |
| OUS | $8.1 | $17.5 | ($9.4) | (53.6%) |
| Total | $71.1 | $72.6 | ($1.5) | (2%) |
Earnings
| Amt | % of Sales | |
|---|---|---|
| Sales | $18.9 | |
| Cost of Sales | $3.8 | 20.1% |
| General and Admin | $9.4 | 49.8% |
| Selling and Marketing | $10.0 | 53% |
| R & D | $2.1 | 10.8% |
| Other | $17.0 | 90.1% |
| Net Earnings | ($14.0) | (74%) |
Mike Evers is ORTHOWORLD’s Digital Content Strategist. He can be reached by email.
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ME
Mike Evers is a Senior Market Analyst and writer with over 15 years of experience in the medical industry, spanning cardiac rhythm management, ER coding and billing, and orthopedics. He joined ORTHOWORLD in 2018, where he provides market analysis and editorial coverage.
