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CI

CorMedix Inc. (CRMD)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered a clean beat versus Street: revenue $39.1mm vs consensus $36.0mm (+8.6%); diluted EPS $0.30 vs $0.245; EBITDA $20.25mm vs $15.0mm. Management also raised H1 net sales guidance to $62–$70mm and now expects the high end (~$70mm) from existing customers. Bold beat driven by outpatient dialysis adoption at U.S. Renal Care and ramping smaller operators *. Values retrieved from S&P Global.
  • Sequentially, revenue rose to $39.1mm from $31.2mm in Q4 2024 and $11.5mm in Q3 2024; gross margin stayed exceptionally high (>95%). Net income flipped positive YoY to $20.6mm (vs. -$14.5mm) with operating income of $20.1mm and cash from operations of $19.7mm .
  • Guidance: H1 2025 net sales to existing customers raised from $50–$60mm to $62–$70mm (now targeting the high end) and implied Q2 net revenue of $23–$31mm (expected moderate sequential decline due to shipment timing and shelf-stock adjustment tied to ASP mechanics) .
  • Strategic catalysts for the stock: potential mid‑year implementation at a contracted large dialysis operator (LDO), inpatient penetration doubling in April (3% of shipments in Q1 to >6% in April), and Phase 3 TPN study initiation with first site screening patients; mix shift towards Medicare Advantage (~40% of claims) supports reimbursement durability .

What Went Well and What Went Wrong

What Went Well

  • Strong commercial execution: “strong first quarter net sales of $39.1 million… Adjusted EBITDA… $23.6 million” with order trends driving H1 to the high end of guidance .
  • Inpatient momentum: “inpatient hospital ordering accounted for more than 6% of shipments, up more than double from the first quarter” as the dedicated inpatient sales team became fully operational; VA facility orders shipped .
  • Clinical and RWE progress: Phase 3 TPN study initiated (first site screening patients; orphan drug application submitted) and RWE study eclipsed 2,000 patients, midpoint expected in July, underpinning MA negotiations and long‑term reimbursement resiliency .

What Went Wrong

  • Near‑term lumpiness and price mechanics: Q2 revenue expected to dip vs Q1 due to shipment timing at U.S. Renal Care and anticipated shelf‑stock adjustment as ASP resets; net price erosion expected beginning in Q2 .
  • Customer concentration risk: U.S. Renal Care accounted for ~78–80% of Q1 shipments/revenue, highlighting reliance on anchor accounts pending broader LDO rollout .
  • OpEx inflation in support of growth: Operating expenses up ~9% YoY to $17.4mm; R&D up ~281% to $3.2mm as clinical programs ramp (positive strategically, but a margin headwind if revenue growth slows) .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD)$11.456mm $31.210mm $39.082mm
Net Income ($USD)$(2.777)mm $13.464mm $20.644mm
EPS ($/share)$(0.05) Basic & Diluted $0.22 Basic $0.30 Diluted
Gross Profit ($USD)$10.770mm $30.034mm $37.485mm
Gross Margin (%)94.0% (10.770/11.456) 96.2% (30.034/31.210) 95.9% (37.485/39.082)
Operating Income ($USD)$(3.287)mm $12.936mm $20.125mm
EBIT Margin (%)-28.7% (−3.287/11.456) 41.4% (12.936/31.210) 51.5% (20.125/39.082)
Total Operating Expenses ($USD)$14.057mm $17.098mm $17.360mm
Cash from Operations ($USD)n/an/a$19.737mm

Non‑GAAP (as reported):

MetricQ4 2024Q1 2025
EBITDA ($USD)$13.098mm $20.249mm
Adjusted EBITDA ($USD)$15.327mm $23.603mm

KPIs and Commercial Mix:

KPIQ3 2024Q4 2024Q1 2025
U.S. Renal Care share of shipments/revenue (%)n/a>80% (FY mix commentary) ~78–80% (Q1)
Inpatient share of shipments (%)n/a~3% unit / 4–5% dollars (Q1 view) ~3% of shipments (Q1); >6% in April
Cash & Short-term investments ($USD)$46.0mm $51.7mm $77.5mm

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Net Sales to existing purchasing customers ($USD)H1 2025$50–$60mm Raised to $62–$70mm; management now targets high end (~$70mm) Raised; narrowed to high end
Net Revenue ($USD)Q2 2025 (implied)n/a$23–$31mm (moderate sequential decline due to shipment timing and inventory runoff) New
Cash Operating Expenses ($USD)FY 2025$72–$78mm Reiterated $72–$78mm Maintained
Net Price trajectoryQ2 2025 onwardn/aExpect net price erosion and shelf‑stock adjustment as ASP resets entering Q3 New commentary (headwind)
Clinical timeline (TPN Phase 3)2025–2027Initiation planned H1 2025 Site active and screening; target study completion end‑2026/early‑2027; orphan status application submitted On track

Earnings Call Themes & Trends

TopicQ3 2024 (Q-2)Q4 2024 (Q-1)Q1 2025 (Current)Trend
LDO implementationSigned LDO agreement; preparing protocols; 2025 timing targeted Mid‑year 2025 implementation hoped; info requests ongoing “Optimistic” on mid‑year start; heightened preparatory activity Improving probability
Inpatient penetrationEarly P&T progress; first hospital pull‑through Dedicated inpatient team build via Syneos; VA promo via WSI Team fully staffed; inpatient shipments doubled to >6% in April Accelerating
TDAPA/MA reimbursementTDAPA in force; MA lagging initially MA share rising; policy change lifted headwind; targeting direct MA contracts using RWE ~40% of claims now MA; negotiating during TDAPA; expect ~50% steady‑state Improving coverage
Pricing/ASP mechanicsn/aFlagged ASP dynamics; potential erosion in 2025 Net price erosion expected from Q2; shelf‑stock adjustment entering Q3 Emerging headwind
Supply chain/tariffsn/aInventory robust; multiple CDMOs Tariff/macro not a constraint; ample API and finished goods Neutral
Clinical expansion (TPN)Protocol amendments; FDA submission targeted Nov 2024 Enrollment expected Q2 2025; orphan application submitted Site active; screening; peak sales est. $150–$200mm in TPN On track
Real‑world evidence (RWE)Commenced data collection Building towards >2,000 patients >2,000 patients enrolled; midpoint July; supports MA negotiations Progressing

Management Commentary

  • “Adjusted EBITDA for the first quarter of $23.6 million… We are able to further narrow our guidance towards the upper end… project net revenue of approximately $70 million from existing purchasing customers over the first half of the year.” — CEO Joe Todisco .
  • “Inpatient hospital ordering accounted for more than 6% of shipments, up more than double from the first quarter.” — CEO Joe Todisco .
  • “Net income was $20.6 million or $0.32 per share… net cash provided by operations… $19.7 million… cash and cash equivalents of $77.5 million.” — CFO Matt David .
  • “We expect net price erosion… and… a shelf stock adjustment at the end of the second quarter as we move into third.” — CEO Joe Todisco .
  • “Our clinical… RWE study… eclipsed 2,000 patients… critical to our objective of making DefenCath a standard of care.” — CEO Joe Todisco .

Q&A Highlights

  • LDO timing and scale: Management reported “heightened levels of… preparatory activity” and remains “optimistic” for mid‑year implementation; scope could scale quickly once a PO is issued .
  • Inventory and shipment lumpiness: Q2 moderation largely due to U.S. Renal shipment timing and prior inventory; macro/tariffs not impacting supply; ample API and finished goods capacity across two qualified manufacturers .
  • Customer mix: U.S. Renal Care ~78% of Q1 revenue; still >80% of eligible patients implemented, with runway via new patients and other mid‑sized/small customers .
  • Reimbursement: ~40% of claims now Medicare Advantage; CorMedix intends to negotiate MA contracts during TDAPA supported by RWE; MA expected to approach ~50% of Medicare ESRD mix .
  • Inpatient opportunity: TAM ~10% of unit volume; better pricing durability; share doubled to >6% in April; dedicated inpatient team focusing on academic medical centers and VA .

Estimates Context

MetricQ1 2025 ConsensusQ1 2025 ActualSurprise
Revenue ($USD)$36.003mm*$39.082mm +$3.079mm (+8.6%)*
Diluted EPS ($)$0.245*$0.30 +$0.055*
EBITDA ($USD)$15.000mm*$20.249mm +$5.249mm*

Values retrieved from S&P Global.

Where estimates may adjust:

  • Q2 implied revenue of $23–$31mm (shipment timing, shelf‑stock adjustment) suggests consensus may need to reflect lower sequential sales before re‑accelerating in H2 as inventory normalizes and new customers ramp .
  • Inpatient contribution and potential LDO activation are upside swing factors not fully embedded in near‑term consensus ranges, warranting upward revisions if implementation is confirmed .

Key Takeaways for Investors

  • Quarter was a high‑quality beat with strong profitability and cash generation; extremely high gross margins (>95%) underscore defensibility of the model while TDAPA lasts .
  • Near‑term revenue cadence likely dips in Q2 due to shipment timing and ASP mechanics (shelf‑stock adjustment), but H2 should re‑accelerate as utilization growth and potential LDO implementation kick in; treat H1 as a lumped period per management’s guidance .
  • Concentration in U.S. Renal Care remains a risk but is tapering; watch for incremental mid‑sized/smaller outpatient and inpatient wins to diversify revenue .
  • Inpatient penetration is emerging and priced favorably; sustained growth here can cushion ASP‑related headwinds and broaden the narrative beyond outpatient dialysis .
  • RWE read‑through and MA mix (~40% claims) position CorMedix to negotiate direct MA contracts during TDAPA, supporting more durable reimbursement post‑TDAPA .
  • Clinical expansion (TPN Phase 3) adds medium‑term optionality with peak sales potential cited at $150–$200mm for the indication; early execution milestones achieved .
  • Trading implications: fade any Q2 softness tied to ASP/shelf dynamics; re‑rate potential on confirmed LDO timing and inpatient traction; monitor MA reimbursement updates and RWE milestones as catalysts .

Appendix: Additional Primary Sources (Q1 2025)

  • Form 8‑K Item 2.02 and Exhibit 99.1 for Q1 2025 results and non‑GAAP reconciliations .
  • Preliminary Q1 2025 press release raising H1 guidance .
  • Q4 2024 8‑K and press release for prior quarter comparisons .
  • Q3 2024 8‑K and press release for trend analysis .