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ARTIVION, INC. (AORT)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue was $97.3M (+4% YoY GAAP; +3% constant currency), with adjusted EBITDA of $17.6M (18% margin); cyber incident reduced Q4 revenue by ~$4.5M (~5% growth headwind) and adjusted EBITDA by ~$2M .
  • Product strength persisted: On‑X +10% cc, stent grafts +8% cc, BioGlue +7% cc; tissue processing declined 8% cc due to the incident; excluding the incident, tissue would have grown ~3% and stent grafts ~16% .
  • AMDS granted FDA HDE in Dec 2024; 1‑year data shows 50% lower mortality vs reference cohort; PMA timeline shifted to mid‑2026 due to new bench testing standards; management expects minimal revenue impact from delay given HDE commercialization path .
  • 2025 outlook: revenue $420–$435M (10–14% cc growth; ~−200bp FX on reported), adjusted EBITDA $84–$91M (+18–28% YoY), gross margin +100bp; Q1 2025 revenue guided to $94–$96M as tissue/On‑X volumes catch up later in the year .
  • Catalyst stack: AMDS U.S. launch under HDE, On‑X mortality benefit data in under‑60s (JACC/STS), BioGlue China commercialization in 2H25, NEXUS 30‑day data at AATS in May; deleveraging via expected convert‑to‑shares (<2x net leverage YE25) .

What Went Well and What Went Wrong

What Went Well

  • On‑X continued double‑digit growth and share gains, supported by new STS/JACC data showing mortality benefit for mechanical vs tissue valves under age 60; management expects sustained double‑digit growth .
  • AMDS received FDA HDE; PERSEVERE trial 1‑year data showed sustained benefit (50% lower mortality vs reference) with zero DANE; enables pre‑PMA U.S. commercialization .
  • Operating leverage intact: Q4 adjusted EBITDA up ~15% YoY to $17.6M; non‑GAAP G&A as % of revenue improved by ~210bp YoY in Q4, contributing to margin expansion .

What Went Wrong

  • Late‑Nov 2024 cybersecurity incident: ~$4.5M revenue impact (≈5% growth headwind) and ~$2M adj. EBITDA drag; tissue and made‑to‑order stent grafts were most affected due to process inefficiencies and lack of inventory buffers .
  • Tissue processing −8% cc in Q4; management expects Q1 2025 tissue revenues “significantly lower than normal,” with releases catching up through the year .
  • PMA approval for AMDS pushed to mid‑2026 to accommodate updated international bench testing standards; however, HDE mitigates the revenue timing risk .

Financial Results

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$98.0 $95.8 $97.3
Revenue YoY Growth (%)+10% +9% +4%
GAAP Diluted EPS ($)−0.05 −0.05 −0.39
Adjusted Diluted EPS, non‑GAAP ($)0.07 0.12 0.00
Gross Margin (%)64.6% 64% 63%
Adjusted EBITDA ($USD Millions)$18.6 $17.7 $17.6
Adjusted EBITDA Margin (%)19% 18.5% 18%
Free Cash Flow, non‑GAAP ($USD Millions)$3.6 $7.8 $8.7

Segment breakdown – Products and Preservation:

Segment Revenue ($USD Millions)Q2 2024Q3 2024Q4 2024
Aortic stent grafts$32.190 $28.643 $30.145
On‑X$20.645 $21.478 $22.178
Surgical sealants$18.545 $18.437 $19.935
Other$1.830 $2.686 $2.404
Total products$73.210 $71.244 $74.662
Preservation services$24.809 $24.535 $22.646
Total revenues$98.019 $95.779 $97.308

Geographic revenue:

Region ($USD Millions)Q2 2024Q3 2024Q4 2024
North America$48.662 $49.089 $49.261
EMEA$34.145 $30.423 $33.362
Asia Pacific$9.653 $10.366 $9.574
Latin America$5.559 $5.901 $5.111
Total revenues$98.019 $95.779 $97.308

KPIs and balance sheet:

KPIQ2 2024Q3 2024Q4 2024
Cash & Equivalents ($USD Millions)$55.019 $56.173 $53.463
Total Debt ($USD Millions)~$313.6 (LT $313.295 + CP $0.268) ~$314.0 (LT $214.270 + CP $99.698) ~$314.3 (LT $314.152 + CP $0.195)
Net Leverage (x)4.1x (end Q2) 3.9x (end Q3) 3.8x (end Q4)
Non‑GAAP G&A ($USD Millions)$47.287 $46.586 $47.530

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue (reported)FY 2025—$420–$435MNew
Revenue growth (constant currency)FY 2025—+10% to +14%New
FX impact on reported growthFY 2025—≈ −200bpNew
Adjusted EBITDAFY 2025—$84–$91M (+18–28% YoY)New
Gross marginFY 2025“Relatively flat” guidance prior~+100bp improvementRaised
R&D expense (% of sales)FY 2025~7% (2024)~8%Raised
Q1 revenue (reported)Q1 2025—$94–$96MNew one‑time quarterly guide
AMDS HDE impactFY 2025—+1–2pp to cc growth; minimal EBITDA impact in year 1New
Adj. EBITDA marginFY 2025—+200bp at midpointNew
FY 2024 revenueFY 2024$389–$396M$389–$396M (unchanged at Q3)Maintained
FY 2024 adjusted EBITDAFY 2024$69–$72M$69–$72M (unchanged at Q3)Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024, Q3 2024)Current Period (Q4 2024)Trend
Cybersecurity incident— ; —~$4.5M revenue and ~$2M adj. EBITDA impact; Q1 2025 tissue/On‑X lower, catch‑up later Near‑term cadence shift, minimal FY25 impact
AMDS (HDE/PMA)PMA expected 2025 HDE granted; PMA now mid‑2026; 1‑yr mortality −50% vs ref cohort; zero DANE Commercial path accelerated via HDE; PMA delayed
On‑X mechanical valves+15% cc; strong data & share STS/JACC: mortality benefit <60; continued double‑digit growth outlook Strengthening clinical narrative; sustained growth
BioGlue ChinaMid‑single‑digit annual growth profile NMPA approval; commercialization expected 2H25 Regulatory progress; launch in 2H25
Regional growth (LatAm/APAC)+25%/+15% cc +26%/+11% FY; continued strength Sustained
Endospan NEXUS50/60 enrolled; H2’26 approval track Q1: 30‑day data at AATS in May; H2’26 approval track On track
FXNegligible 2024 ~−200bp headwind to reported FY25 growth Modest headwind
Leverage / convertOptionality; net leverage falling Expect convert to shares; <2x net leverage YE25 (midpoint) Deleveraging trajectory

Management Commentary

  • “We estimate the [cyber] incident had a negative impact of approximately $4.5 million on our Q4 revenue… we do not expect this incident to meaningfully impact our business for the full year of 2025” — CEO Pat Mackin .
  • “Adjusted EBITDA increased approximately 15% … margin was 18% in the fourth quarter… driven by a 210 basis point reduction in non‑GAAP adjusted general and administrative and marketing expense as a percentage of revenue” — CFO Lance Berry .
  • “Late‑breaking data from our AMDS PERSEVERE trial demonstrated sustained benefit … mortality in the AMDS group 50% lower than the reference cohort… zero occurrence of DANE” — CEO Pat Mackin .
  • “We expect constant currency growth of between 10% and 14% for the full year 2025… adjusted EBITDA to be in the range of $84 million to $91 million… we expect gross margins to improve by about 100 basis points” — CFO Lance Berry .

Q&A Highlights

  • AMDS launch cadence: ~1,000 potential U.S. centers; focus on top ~600; three‑step process (IRB, value analysis committee, training); ~55 U.S. reps pursuing accounts .
  • Catch‑up mechanics post‑incident: Tissue demand exceeds supply quarterly; donations continued; longer lead‑times shift releases later; On‑X distributor orders also shift later; management confident full‑year recovery .
  • PMA delay rationale: New international bench testing standards applied to all implantables; adds ~2 quarters; HDE mitigates timing impact on revenue .
  • 2025 margin/opex dynamics: +100bp gross margin on AMDS mix; ~2pp SG&A leverage; R&D ~8% of sales; minimal 2025 EBITDA benefit from AMDS due to year‑1 investments .
  • Capital structure: Intend convert to shares at maturity to delever (<2x net leverage at midpoint); rationale vs rolling into new convert/private debt .

Estimates Context

  • We attempted to retrieve S&P Global consensus for Q4 2024 EPS and revenue, and for FY 2024/2025. The request failed due to SPGI daily request limits. As a result, direct comparisons to Wall Street estimates are unavailable at this time (S&P Global rate limit error). We will update with consensus when accessible.
Consensus MetricQ4 2024FY 2024FY 2025
Revenue Consensus Mean ($USD Millions)Unavailable (SPGI rate limit)Unavailable (SPGI rate limit)Unavailable (SPGI rate limit)
Primary EPS Consensus Mean ($)Unavailable (SPGI rate limit)Unavailable (SPGI rate limit)Unavailable (SPGI rate limit)
# of Estimates (Revenue / EPS)UnavailableUnavailableUnavailable

Key Takeaways for Investors

  • Q4 headline numbers resilient despite a one‑time cyber headwind; underlying demand strong with catch‑up expected through 2025, particularly in tissue and On‑X; traders should anticipate non‑typical quarterly cadence with Q1 softer and sequential improvement thereafter .
  • AMDS HDE is a significant commercial and clinical milestone; 1‑year data strengthens the adoption case; PMA delay shifts approval to mid‑2026 but is offset by HDE sales ramp in 2025; expect stent graft line to visibly reflect AMDS contribution .
  • On‑X thesis strengthened by large STS/JACC mortality data under age 60; combined with post‑approval bleeding reduction, the narrative supports continued double‑digit growth and share gains globally .
  • International growth remains a lever (LatAm, APAC); FX is a modest headwind (~−200bp to reported growth in 2025), but EBITDA impact is muted due to natural hedge .
  • 2025 guide implies revenue acceleration vs Q4 reported pace and margin expansion (+100bp gross; +200bp adj. EBITDA margin at midpoint); AMDS adds +1–2pp to constant currency growth in 2025 with larger EBITDA benefits in 2026+ .
  • Balance sheet improving: Net leverage down to 3.8x in Q4; expected convert‑to‑equity in July 2025 positions leverage <2x by YE25, enhancing strategic flexibility for Endospan/NEXUS option .
  • Near‑term trading implications: Watch account onboarding for AMDS (IRB/VAC cadence), Q1 revenue delivery vs $94–$96M guide, and sequential reacceleration in tissue/On‑X; medium‑term thesis hinges on execution of AMDS HDE launch, BioGlue China ramp in 2H25, and NEXUS progress/data .