Total Revenue (USD, thousands)

Cost of Goods Sold (USD, thousands)

Selling, General, and Administrative Expenses (USD, thousands)

Research and Development (USD, thousands)

Depreciation and Amortization (USD, thousands)

Interest Expense (USD, thousands)

Operating Income (USD, thousands)

Net Income (USD, thousands)

Earnings Per Share (EPS) - Basic (USD)

Earnings Per Share (EPS) - Diluted (USD)

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Current Assets (USD, thousands)

Cash and Cash Equivalents (USD, thousands)

Accounts Receivable (USD, thousands)

Inventory (USD, thousands)

Non-Current Assets (USD, thousands)

Property, Plant, and Equipment (PP&E) (USD, thousands)

Goodwill (USD, thousands)

Intangible Assets (USD, thousands)

Current Liabilities (USD, thousands)

Accounts Payable (USD, thousands)

Short-term Debt (USD, thousands)

Accrued Expenses (USD, thousands)

Non-Current Liabilities (USD, thousands)

Long-term Debt (USD, thousands)

Deferred Tax Liabilities (USD, thousands)

Shareholders' Equity (USD, thousands)

Retained Earnings (USD, thousands)

Common Stock (USD, thousands)

Additional Paid-in Capital (USD, thousands)

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Net Revenue (USD, thousands)

Gross Profit (USD, thousands)

Research and Development Costs (USD, thousands)

Total Operating Expenses (USD, thousands)

Operating Loss (USD, thousands)

Other Income (Expense), Net (USD, thousands)

Interest Expense, Net (USD, thousands)

Total Other Expense, Net (USD, thousands)

Loss Before Income Taxes (USD, thousands)

Income Tax Expense (Benefit) (USD, thousands)

Net Loss (USD, thousands)

Foreign Currency Translation Adjustment (USD, thousands)

Comprehensive Loss (USD, thousands)

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Cash and cash equivalents (USD, thousands)

Trade receivables, net (USD, thousands)

Inventories, net (USD, thousands)

Income taxes receivable (USD, thousands)

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Property and equipment, net (USD, thousands)

Intangible assets, net (USD, thousands)

Deferred income taxes - Asset (USD, thousands)

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Accounts payable (USD, thousands)

Accrued expenses (USD, thousands)

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Income taxes payable - Current (USD, thousands)

Total current liabilities (USD, thousands)

Long-term debt net, less current maturities (USD, thousands)

Other long-term liabilities (USD, thousands)

Deferred income taxes - Liability (USD, thousands)

Income taxes payable - Long-term (USD, thousands)

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Common stock (USD, thousands)

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Accumulated other comprehensive income (loss) (USD, thousands)

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Total stockholders' equity (USD, thousands)

Total liabilities & stockholders' equity (USD, thousands)

e80ebfc0747ae8d5090c1a7b98ba37f3f1721ebaac368405a2ee499ce4874ab0

The spike in **long-term debt net, less current maturities** for Q4 2023 is primarily due to Paragon 28, Inc. entering into a new credit agreement with Ares Capital Corporation. Under this agreement, the company secured a **$50 million revolving credit facility** and a **$100 million term loan facility**, from which it drew **$25 million** and **$75 million**, respectively. These drawdowns significantly increased the company’s long-term debt position, especially as the proceeds were used to refinance previous debt such as the MidCap Term Loan, resulting in an increase from **$42,288 thousand** in Q3 2023 to **$109,799 thousand** in Q4 2023.  **[0000950170-24-055595_fna-20240331.htm:10]** **[0000950170-24-023050_fna-20231231.htm:175]** **[0000950170-24-023050_fna-20231231.htm:196]** 

Why did Long-term debt spike so high in Q4 2023?

The marked increase in **Total Assets in Q4 2023** was primarily driven by several key factors. **Cash** saw significant growth due to financing activities—including the issuance of long-term debt and common stock—which bolstered the company's liquidity. In addition, there was a substantial rise in **Inventories** as the company built stock to support anticipated sales growth and mitigate supply chain risks. Moreover, increased investments in **Property and Equipment, Net** and growth in **Other Assets** contributed to the overall enhancement of the asset base.  **[0000950170-24-023050_fna-20231231.htm:175]** **[0001193125-24-053378_d692216dex991.htm:5]** **[0001193125-24-053378_d692216dex991.htm:6]** **[0000950170-24-023050_fna-20231231.htm:160]** 

What drove the marked increase in Total assets in Q4 2023?

The accumulated deficit deepened in Q4 2023 because the company incurred a **net loss of $47,841 thousand** during that period. This substantial loss was driven by several factors including a continued **operating loss of $37,309 thousand**, high operating expenses related to investments in research and development, selling, general, and administrative activities, as well as **inventory write-downs of approximately $4.0 million**. Additionally, costs related to **net interest expense of $5,165 thousand** and a **loss on early extinguishment of debt of $5,308 thousand** further contributed to the larger deficit.  **[0000950170-24-023050_fna-20231231.htm:175]** **[0000950170-24-023050_fna-20231231.htm:160]** **[0001193125-24-053378_d692216dex991.htm:5]** **[0001193125-24-053378_d692216dex991.htm:0]** 

Why did the Accumulated deficit deepen in Q4 2023?

The drop in **cash and cash equivalents** in Q1 2024 was primarily caused by a combination of factors. **Operating activities** used **$11.0 million** in cash due to a **$15.2 million net loss** that was partially offset by non-cash adjustments including **$4.3 million in depreciation and amortization** and **$3.1 million in stock-based compensation**. Additionally, unfavorable changes in working capital, such as a **$7.0 million increase in inventories** and a **$3.1 million increase in accounts receivable**, also contributed to the decline. **Investing activities** used **$5.8 million** in cash for purchases related to surgical instrumentation and other equipment, while **financing activities** led to an outflow of **$1.3 million**, mainly due to a specific payment related to the Additive Orthopaedics acquisition milestone. A **positive effect of $0.6 million** from exchange rate changes slightly offset these outflows. These combined factors resulted in a **$17.4 million decrease** in cash and cash equivalents during the quarter.  **[0000950170-24-055595_fna-20240331.htm:25]** **[0001193125-24-134185_d829713dex991.htm:5]** 

What caused the drop in Cash and cash equivalents in Q1 2024?

The **total liabilities** rose in Q1 2024 mainly because of a **substantial increase in accounts payable**—rising from **$21,696 thousand** to **$29,224 thousand** (an increase of **$7,528 thousand**)—which was the most significant factor. Additionally, there were smaller increases in **other long-term liabilities** (**$308 thousand**) and in **long-term debt (net of current maturities)** (**$48 thousand**), contributing to the overall increase of **$7,160 thousand** from the previous period.  **[0000950170-24-055595_fna-20240331.htm:4]** **[0001193125-24-134185_d829713dex991.htm:4]** 

Why did Total liabilities rise in Q1 2024?

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The **Cost of Goods Sold surged in Q4 2023** primarily because the company recorded **non-cash inventory write-downs of $4 million**, which reduced the gross profit margin by **6.6 percentage points**; this effect was compounded by **higher variable costs** associated with increased net revenue and a greater proportion of **international sales that carry lower gross profit margins**.  **[0000950170-24-023050_fna-20231231.htm:160]** **[FNA_3377504_3]** 

Why did Cost of Goods Sold surge in Q4 2023?

The documents explain the Q4 2023 net loss factors compared to Q4 2022 rather than a change from the prior quarter. Specifically, the improvement in Q4 2023’s net loss (at **$19,559 thousand** versus **$38,763 thousand** in Q4 2022) was mainly driven by the **absence of a $27,000 thousand legal settlement expense** that was incurred in Q4 2022. Additionally, **revenue grew by 17.6% year-over-year** (boosting gross profit), although this was partially offset by a **$4,000 thousand inventory write-down** and a **10.5% increase in operating expenses** (SG&A and R&D).  **[0001193125-24-053378_d692216dex991.htm:6]** **[FNA_3377504_3]** **[0001193125-24-053378_d692216dex991.htm:0]** **[0001193125-24-053378_d692216dex991.htm:5]** 

If you are referring to the increase from Q3 2023 (net loss of **$8,332 thousand**) to Q4 2023, the documents do not provide direct commentary on that change.

What drove the sharp increase in net loss in Q4 2023?

The lower annual net loss in FY 2023 was primarily driven by **revenue growth** and a significant **improvement in operating loss**. Specifically, net revenue increased by **$35,006** (a 19% growth), and the operating losses improved by **$24,738** largely because the **$27,000 legal settlement expense** that impacted FY 2022 was not incurred in FY 2023. These factors, despite some increases in cost of goods sold and operating expenses, contributed to the net loss decreasing from **$(67,326)** in FY 2022 to **$(47,841)** in FY 2023.  **[0000950170-24-023050_fna-20231231.htm:160]** **[0000950170-24-023050_fna-20231231.htm:178]** 

What factors contributed to the lower annual net loss in FY 2023?

The **Interest Expense, Net** for **Q2 2024** increased significantly because the company had **higher levels of outstanding debt** and was paying **higher interest rates** on that debt compared to previous periods.  **[0001558370-24-011606_fna-20240630x10q.htm:28]** 

Paragon 28 Inc (FNA)

Financials