ALPHARETTA, Ga., Jan. 4, 2024
/PRNewswire/ -- Avanos Medical, Inc. (NYSE: AVNS) today reported
selected, unaudited preliminary financial results for the fourth
quarter and full-year ended December 31,
2023 and revised its preliminary revenue outlook for
2024.
Preliminary Unaudited Financial Results
For the fourth quarter ended December 31,
2023, Avanos Medical, Inc. (the "Company") expects net sales
in the range of $170 million to
$173 million, a decrease of
approximately 6.5% to 4.5% compared to the same period in 2022,
with net sales for the year ended December
31, 2023 anticipated to be in the range of $670 million to $673
million.
Net sales for the fourth quarter were lower than expected due
to:
- Underperformance by the Company's hyaluronic acid ("HA") pain
relief injection products, primarily as a result of continued
pricing pressure due to the Medicare reimbursement changes. The
Company estimates that net sales for the HA product line will be
slightly above $10 million for the
fourth quarter of 2023, which is approximately $4 million lower than anticipated.
- Lower than anticipated sales across the Company's North America
Digestive Health products, primarily due to a major distributor's
ordering pattern change.
- North America Pain Management and Recovery sales, while
improved, were below internal expectations.
The Company anticipates that the lower than expected net sales
will negatively impact adjusted gross margin, adjusted EBITDA
margin and adjusted earnings per share for the fourth quarter and
the full year. The Company is currently unable to quantify the
overall impact on these measures.
"Although we are disappointed with our fourth quarter sales
results, we were pleased with the execution of our three- year
transformation initiative throughout 2023, which we believe
positions us strongly for 2025," stated Joe
Woody, Avanos' chief executive officer. "We are maintaining
the 2025 financial objectives that we laid out at our Investor Day
in June, and I look forward to updating investors on our overall
progress next Monday at the JP Morgan Healthcare Conference."
Revised Preliminary 2024 Revenue Outlook
The Company is updating its previous revenue guidance for the
year ending December 31, 2024. For
2024, the Company now expects net sales in the range of
$685 million to $705 million, reflecting continued HA market
dynamics. The Company will provide additional information regarding
its outlook for 2024 on the conference call it will host to discuss
its financial results for the quarter and year ended December 31, 2023, which is currently scheduled
for February 20, 2024.
The Company does not plan to release preliminary financial
information on an ongoing basis. The financial information
presented above is preliminary, is based on information available
to management as of the date of this press release, and is subject
to further changes upon completion of the Company's standard
quarter and year-end closing procedures. This update does not
present all necessary information for an understanding of the
Company's financial condition as of the date of this press release
or its results of operations for the quarter and year ended
December 31, 2023. As the Company
completes its quarter-end and year-end financial close processes
and finalizes its financial statements for the quarter and year
ended December 31, 2023, it will be
required to make significant judgments in a number of areas. It is
possible that the Company may identify items that require it
to make adjustments to the preliminary financial information set
forth above and those changes could be material. The Company does
not intend to update such financial information prior to release of
its financial statement information for the quarter and year ended
December 31, 2023, which is currently
scheduled for February 20, 2024.
About Avanos Medical, Inc.
Avanos Medical (NYSE: AVNS) is a medical technology company
focused on delivering clinically superior solutions that will help
patients get back to the things that matter. Headquartered in
Alpharetta, Georgia, Avanos is
committed to addressing some of today's most important healthcare
needs, including providing a vital lifeline for nutrition to
patients from hospital to home, and reducing the use of opioids
while helping patients move from surgery to recovery. Avanos
develops, manufactures and markets its recognized brands globally
and holds leading market positions in multiple categories across
its portfolio. For more information, visit www.avanos.com and
follow Avanos Medical on Twitter (@AvanosMedical), LinkedIn and
Facebook.
Forward-Looking Statements
This press release contains information that includes or is
based on "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements include all statements that do not relate solely to
historical or current facts, and can generally be identified by the
use of words such as "may," "believe," "will," "expect," "project,"
"outlook," "estimate," "anticipate," "plan" or "continue" and
similar expressions. The forward-looking statements in this release
include, without limitation, statements regarding the Company's
expectations regarding financial results for the fourth quarter and
full-year ended December 31, 2023 and
for the year ending December 31, 2024
and the impact of the Company's transformation initiative.
Forward-looking statements are based on the current plans and
expectations of management and are subject to various risks and
uncertainties that could cause our actual results to differ
materially from those expressed or implied in such statements as a
result of a variety of factors. Such factors include, but are not
limited to: completion of quarter and year-end closing procedures,
weakening of economic conditions that could adversely affect the
level of demand for our products; pricing pressures generally,
including cost-containment measures that could adversely affect the
price of or demand for our products; shortage in drugs used in our
Surgical Pain and Recovery products or other disruptions in our
supply chain; the ongoing regional conflicts between Russia and Ukraine and in the Middle East; our ability to successfully
execute on or achieve the expected benefits of the Transformation
Process or our divestiture, acquisition or merger transactions;
inflationary pressures; the effects of the recent financial
conditions affecting the banking system and the potential threats
to the solvency of commercial banks; changes in foreign exchange
markets; legislative and regulatory actions; unanticipated issues
arising in connection with clinical studies and otherwise that
affect U.S. Food and Drug Administration approval of new products;
changes in reimbursement levels from third-party payors; a
significant increase in product liability claims; the impact of
investigative and legal proceedings and compliance risks; the
impact of the federal legislation to reform the United States healthcare system; changes
in financial markets; and changes in the competitive environment.
The information contained herein speaks only as of the date of this
press release and we undertake no obligation to update
forward-looking statements, except as may be required by the
securities laws.
Additional information concerning these and other factors that
may impact future results is contained in our filings with the U.S.
Securities and Exchange Commission, including our most recent Form
10-Q.
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SOURCE Avanos Medical