Edwards Lifesciences Reports Second Quarter Results
PR Newswire
IRVINE, Calif. , July 26, 2023 /PRNewswire/ -- Edwards Lifesciences (NYSE: EW) today reported financial results for the quarter ended June 30, 2023.
Highlights and Outlook
- Q2 sales grew 11 percent to $1.53 billion ; constant currency 1 sales grew 12 percent
- All product groups achieved double digit constant currency sales growth in Q2
- Q2 TAVR sales grew 9 percent; constant currency sales grew 10 percent
- Q2 EPS of $0.50 (includes charge from previous IP agreement); adjusted 1 EPS of $0.66
- Encouraging data from Edwards' Benchmark Registry at the EuroPCR medical congress
- New 2023 constant currency sales growth guidance of 10 to 13 percent
"We are pleased to report strong second quarter double-digit sales growth while also making meaningful progress on our innovations to improve patient care globally," said Bernard Zovighian , CEO. "This positive first-half performance and improved healthcare staffing gives us increased confidence in our full-year outlook. Looking beyond 2023, we remain confident that our foundation of innovative therapies along with a differentiated technology pipeline positions us well for continued longer-term success."
Transcatheter Aortic Valve Replacement (TAVR)
For the quarter, the company reported TAVR sales of $992 million , which grew 9 percent versus the prior year, or 10 percent on a constant currency basis. The company's U.S. and OUS sales growth rates were comparable. Globally, on a constant currency basis, the company's average selling prices were stable.
In the U.S., Edwards' TAVR sales were aided by improved hospital staffing levels and the continued successful launch of SAPIEN 3 Ultra RESILIA, which remains on track to represent the majority of the company's U.S. TAVR sales before year end.
Outside the U.S., in the second quarter, Edwards had positive constant currency sales growth from all regions, although lower than expected growth in Japan. The company sees excellent opportunities for international growth as the traditionally low adoption rates improve.
During the quarter, at the EuroPCR medical congress, data on the Benchmark Registry were presented on 2,400 patients treated with SAPIEN valves across 28 European centers. Patients experienced a 33 percent reduction in the median hospital length of stay while maintaining 30-day clinical outcomes.
Transcatheter Mitral and Tricuspid Therapies (TMTT)
In the second quarter, the company continued to successfully deliver on its three key value drivers to treat even more patients suffering from mitral and tricuspid disease: a portfolio of differentiated therapies, positive clinical trial results to support approvals and adoption, and favorable real-world clinical outcomes.
Second quarter sales were $48 million , driven by overall transcatheter edge-to-edge repair procedure growth as well as the ongoing launch and growing adoption of the PASCAL Precision system in Europe and the U.S. The company continues to expect one-year data from the full cohort of the CLASP IID pivotal trial will be presented later this year. Edwards remains on track for European approval of the EVOQUE tricuspid valve by the end of 2023.
Surgical Structural Heart and Critical Care
Surgical Structural Heart sales for the quarter were $256 million , which grew 12 percent, or 13 percent on a constant currency basis. The growth was driven by adoption of Edwards' premium RESILIA based products across all regions.
Critical Care sales for the quarter were $235 million , which grew 11 percent, or 13 percent on a constant currency basis. Sales growth was led by the Smart Recovery technology portfolio and strong adoption of the Acumen IQ sensor.
Additional Financial Results
For the quarter, the adjusted gross profit margin was 77.7 percent, compared to 80.5 percent in the same period last year. As expected, this year-over-year reduction was driven by a less favorable impact from foreign exchange.
Selling, general and administrative expenses in the second quarter were $469 million , or 30.6 percent of sales, compared to $409 million in the prior year. This increase was driven by performance-based compensation and investments in transcatheter field-based personnel in support of the company's growth strategy.
Research and development expenses in the second quarter were $270 million , or 17.7 percent of sales, compared to $251 million in the prior year. This increase was primarily the result of continued investments in the company's transcatheter aortic valve innovations, including increased clinical trial activity.
As previously announced, in April, Edwards entered into an intellectual property agreement. In consideration for the agreement, Edwards made a $300 million payment, approximately half of which has been expensed, while the other half is being amortized over the next 15 years.
Adjusted free cash flow for the second quarter was $286 million , defined as cash flow from operating activities of $34 million , less capital spending of $48 million , and excluding a $300 million payment related to the intellectual property agreement.
Cash, cash equivalents and short-term investments totaled $1 .5 billion as of June 30, 2023. Total debt was approximately $600 million .
Outlook
Overall, given the improving environment and strong first half performance, the company now expects full year 2023 sales to be in the $5.9 to $6.1 billion range, versus the prior guidance of the high end of $5.6 to $6.0 billion . The company now expects full-year total company and TAVR sales growth to be in the 10 to 13 percent range on a constant currency basis, versus previous guidance of 10 to 12 percent. The company now expects TAVR sales of $3.85 to $4.0 billion ; TMTT, $180 to $200 million ; and Surgical Structural Heart, $960 million to $1.02 billion . The company reiterated its full-year Critical Care guidance of $870 to $940 million .
Additionally, the company is lifting its full year 2023 adjusted earnings per share guidance to $2.50 to $2.60 , compared to its previous guidance range of $2.48 to $2.60 .
For the third quarter of 2023, the company projects total sales to be between $1.44 and $1.52 billion , and adjusted EPS of $0.55 to $0.61 .
"The exciting developments during the first half of the year reinforce our confidence in our patient-focused innovation strategy and our longer-term outlook, and we anticipate a year of value creation as we pursue important therapies that will benefit many more patients. We look forward to launching a number of differentiated technologies, as well as achieving important milestones across all of our product lines," said Zovighian.
About Edwards Lifesciences
Edwards Lifesciences is the global leader of patient-focused innovations for structural heart disease and critical care monitoring. We are driven by a passion for patients, dedicated to improving and enhancing lives through partnerships with clinicians and stakeholders across the global healthcare landscape. For more information, visit Edwards.com and follow us on Facebook, Instagram, LinkedIn, Twitter and YouTube.
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Source
https://money.tmx.com/quote/EW:US/news/6087040714666536/EDWARDS_LIFESCIENCES_REPORTS_SECOND_QUARTER_RESULTS
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