AngioDynamics Reports Significant Decline in Financial Performance for Q3 2024

AngioDynamics, Inc. reported a significant decline in financial performance for the three months ended August 31, 2024, compared to the same period in the previous year. Net sales decreased by 14.2% to $67.5 million from $78.7 million in 2023. This decline was primarily driven by the divestiture of several business units, including the PICC and Midline products, which contributed to a $12 million reduction in sales. The Med Tech segment saw a modest increase in revenue, rising 8.2% to $27.97 million, while the Med Device segment experienced a substantial drop of 25.2%, falling to $39.52 million.

Gross profit also fell, totaling $36.72 million, down from $40.06 million in the prior year. The gross profit margin improved by 350 basis points to 54.4%, with the Med Tech segment's margin decreasing slightly to 63.3% and the Med Device segment's margin increasing to 48.1%. The overall decrease in gross profit was attributed to the sale of profitable business units and inflationary pressures on raw materials and labor.

Operating income turned negative, resulting in a loss of $13.1 million, compared to a profit of $35 million in the same quarter of 2023. The net loss for the period was $12.8 million, a stark contrast to the net income of $45.9 million reported in the previous year. Earnings per share reflected this downturn, dropping to $(0.31) from $1.15.

Total operating expenses decreased to $49.82 million from $52.87 million, with reductions in research and development, sales and marketing, and general and administrative expenses. However, restructuring charges related to a shift to an outsourced manufacturing model contributed to increased costs.

On the balance sheet, cash and cash equivalents decreased to $55 million from $76 million as of May 31, 2024. Total assets also fell to $293.6 million, down from $317.7 million. The company reported a decrease in total current liabilities, which stood at $76.7 million.

Strategically, AngioDynamics completed the divestiture of its dialysis and BioSentry businesses, receiving $100 million in cash, which was used to repay outstanding debt. The company has initiated a share repurchase program, with $14.5 million remaining for future repurchases after buying back 72,141 shares for $0.5 million during the quarter. Additionally, a restructuring plan announced in January 2024 is expected to continue through fiscal year 2026, with estimated costs of approximately $13.6 million.