ZimVie (ZIMV) Q2 2024 earnings summary

Executive summary

• Completed the sale of the spine business in April 2024 for $377.2 million, transitioning to a pure-play dental company and recording an $11.3 million gain on the sale.

• Q2 2024 net sales were $116.8 million, down 1.5% year-over-year, with U.S. sales flat and international sales down 3.8% reported (1.2% constant currency).

• Net loss from continuing operations was $9.6 million (net loss margin 8.2%), but adjusted net income was $3.6 million; adjusted EBITDA was $16.1 million (13.8% margin).

• Debt reduced by $275 million using sale proceeds, with quarter-end gross debt at $235 million and cash at $78.6 million.

• Continued innovation and launches in implants, biomaterials, and digital solutions, including FDA clearance for GenTek restorative components, expanded titanium bars for BellaTek abutments, and new scanner partnerships.

Financial highlights

• Q2 2024 adjusted EBITDA from continuing operations was $16.1 million (13.8% margin); adjusted EPS was $0.13 per share.

• Adjusted cost of product sold was 37.0–37.3% of sales, flat year-over-year.

• Adjusted R&D expense was $6.3 million (5.4–5.6% of sales); adjusted SG&A was $62.4 million (53.4% of sales).

• Cash at quarter-end was $78.6–$82.7 million; net debt $156 million.

• Net loss from continuing operations was $9.6 million; basic and diluted EPS from continuing operations was $(0.35).

Outlook and guidance

• Reaffirmed full-year 2024 revenue guidance of $450–$460 million, adjusted EBITDA of $60–$65 million (13.3–14.1% margin), and adjusted EPS of $0.55–$0.70.

• Q3 2024 revenue expected to be sequentially and year-over-year lower by 3–4% due to seasonality.

• Management expects available cash, cash flows from operations, and credit facility access to be sufficient for liquidity needs over the next 12 months.

• Interest expense for 2024 expected at $13 million; share-based compensation $17–$17.5 million.

• Focused on expanding portfolio adoption, reducing expenses, and driving margin improvement.