Bioventus (BVS) Canaccord Genuity 44th Annual Growth Conference & Private Company Showcase 2024 summary

Strategic transformation and portfolio focus

• Restructured leadership and operations post-2022 crisis, hiring a new CEO and management team, resulting in three consecutive quarters of strong results.

• Portfolio now centers on pain treatments, surgical solutions, and restorative therapies, each with distinct short- and long-term growth drivers.

• Announced intent to divest the advanced rehabilitation business to sharpen focus on higher-growth, higher-margin assets, with the transaction expected to close by year-end 2024.

• Divestiture is expected to improve gross margins and revenue growth rates, with minimal EPS impact and provide additional liquidity.

• New CEO brings commercial execution expertise and international market experience, aiming to accelerate growth.

Financial performance and outlook

• Achieved revenue guidance midpoint of $562 million for 2024, with a total addressable market of $15 billion.

• EBITDA increased from $66.3 million in 2022 to $89 million in 2023, with 2024 guidance at $105.5 million, driven by cost reductions and revenue growth.

• Leverage ratio reduced from nearly 6x in 2022 to 3.7x, targeting below 3x by end of 2025.

• Strong cash flow in Q2 2024, with ongoing focus on debt reduction and improved working capital management; operating cash flow turned positive in 2023 and is expected to further improve in 2024.

• Credit agreement renegotiated and extended to early 2025, providing flexibility and supporting ongoing debt reduction.

Business segment highlights

• Pain treatments, led by DUROLANE, delivered 18-19% growth in Q2 2024, benefiting from clinical differentiation, strong payer contracts, and a robust sales force.

• Surgical solutions, including bone graft substitutes and ultrasonics, grew nearly 20% in Q2, with a refined commercial strategy and improved supply chain.

• Ultrasonics portfolio, acquired via Misonix, is considered revolutionary in spine surgery, with plans to expand into neural and general surgery markets.

• EXOGEN, a high-margin restorative therapy product, returned to growth after operational improvements and increased sales focus.

• Peripheral nerve stimulator product expected to receive 510(k) approval within 6-12 months, representing a future growth lever.