NASDAQ:LMAT LeMaitre Vascular Q1 2025 Earnings Report $90.24 -0.50 (-0.55%) Closing price 04:00 PM EasternExtended Trading$88.00 -2.24 (-2.48%) As of 07:42 PM Eastern Extended trading is trading that happens on electronic markets outside of regular trading hours. This is a fair market value extended hours price provided by Polygon.io. Learn more. Earnings HistoryForecast LeMaitre Vascular EPS ResultsActual EPS$0.48Consensus EPS $0.50Beat/MissMissed by -$0.02One Year Ago EPS$0.44LeMaitre Vascular Revenue ResultsActual RevenueN/AExpected Revenue$57.61 millionBeat/MissN/AYoY Revenue Growth+12.00%LeMaitre Vascular Announcement DetailsQuarterQ1 2025Date5/1/2025TimeAfter Market ClosesConference Call DateThursday, May 1, 2025Conference Call Time5:00PM ETConference Call ResourcesConference Call AudioConference Call TranscriptPress Release (8-K)Earnings HistoryCompany ProfilePowered by LeMaitre Vascular Q1 2025 Earnings Call TranscriptProvided by QuartrMay 1, 2025 ShareLink copied to clipboard.There are 13 speakers on the call. Operator00:00:00Welcome to the Lomate Vascular First Quarter twenty twenty five Financial Results Conference Call. As a reminder, today's call is being recorded. At this time, I would like to turn the call over to Mr. Dorian LeBlanc, Chief Financial Officer of Lemaitre Vascular. Please go ahead, sir. Speaker 100:00:18Thank you, operator. Good afternoon, and thank you for joining us on our Q1 twenty twenty five conference call. With me on today's call is our CEO, George Lemaitre and our President, Dave Roberts. Before we begin, I'll read our Safe Harbor statement. Today, we will make some forward looking statements within the meaning of The U. Speaker 100:00:37S. Private Securities Litigation Reform Act of 1995, the accuracy of which is subject to risks and uncertainties. Wherever possible, we will try to identify these forward looking statements by using words such as believe, expect, anticipate, pursue, forecast and similar expressions. Our forward looking statements are based on our estimates and assumptions as of today, 05/01/2025, and should not be relied upon as representing our estimates or views on any subsequent date. Please refer to the cautionary statement regarding forward looking information and the risk factors in our most recent 10 ks and subsequent SEC filings, including disclosure of the factors that could cause results to differ materially from those expressed or implied. Speaker 100:01:22During this call, we will discuss non GAAP financial measures such as organic sales growth. A reconciliation of GAAP to non GAAP measures discussed in this call is contained in the associated press release and is available in the Investor Relations section of our website, www.lemaitre.com. I'll now turn the call over to George Lemaitre. Speaker 200:01:43Thanks, Dorian. Q1 sales were stronger than our February 27 guidance. 13% organic and 12% reported growth was led by grafts, up 17% and carotid shunts, up 14%. We posted sales records in all five of our categories: grafts, carotid shunts, catheters, valvulotomes and patches. By geography, EMEA was up 18%, the Americas eleven % and APAC 3 Percent. Speaker 200:02:11I'll focus my remarks on three topics: first, the growth of our sales force second, our new international sales offices and finally, our MDR CE marks. We currently have 164 reps on payroll, and we're now targeting 170 at year end. We also employ 34 sales managers versus 31 at our last earnings call. The sales force is our number one asset, so we continue to invest in reps, managers and sales offices. Our new Alpine Regional Sales Manager started on April 1 and will oversee seven sales reps in Switzerland, Austria and Czechia. Speaker 200:02:48Shipping from our new Zurich office will reduce customs complexity for Swiss hospitals, and our direct offices almost always improve sales performance. Switzerland is LeMaitre's sixth largest European market. We expect to sign a transition agreement with our Czech distributor shortly and should log our First Direct sale in August. And we are currently recruiting two Czech reps. As for Portugal, we hired our Lisbon Rep on January 1, signed our distributor transition agreement on March 19, and on May 1, became direct in Portugal. Speaker 200:03:22Also in Europe, we've just received our MDR CE mark for autograft, and the European launch will begin presently. Autograft, a biologic graft used primarily in AV access and peripheral bypass, was the company's largest U. S. Product in 2024 with $37,000,000 in U. S. Speaker 200:03:39Sales. At previous earnings calls, we've estimated autograft's current market size to be about $8,000,000 in Europe and $8,000,000 rest of world. We currently have autographed approvals in New Zealand, South Africa, Thailand, Israel and Malaysia. We sold $180,000 of autographs internationally in Q1. We also expect to receive approvals in Australia, Canada, Singapore and Korea by H1 twenty twenty six. Speaker 200:04:05So this is an exciting worldwide launch with plenty of long run upside. Our New Jersey autograph production facility is currently running a single shift and is capable of meeting this new demand. Separately, we continue to anticipate at least one RestoreFlow allograft approval in 2025 from Ireland or Germany. As a reminder, allografts require approval on a country by country basis. Approvals from either Ireland or Germany would then expedite our individual European country approvals. Speaker 200:04:36Anticipating the Irish approval, we'll be opening a pan European RestoreFlow distribution facility in Dublin in H2. RestoreFlow is currently approved in The U. S, The U. K. And Canada. Speaker 200:04:48Since the 2016 acquisition, RestoreFlow's sales CAGR has been 23%. In summary, Q1 sales momentum, our continued office and sales force build out and our regulatory progress allow us to increase our 2025 reported sales guidance to $245,000,000 from $239,000,000 previously, and our organic sales guidance has advanced to 13% from 10% previously. Dollars $3.00 3,000,000 of cash also provides strategic optionality. With that, I'll turn the call over to Dorian. Speaker 100:05:26Thanks, George. The LeMaitre portfolio of niche devices continues to deliver in Q1. As George referenced, we experienced record quarterly sales in grafts, carotid shunts, catheters, valvulotomes and patches. Organic sales growth of 13% over Q1 twenty twenty four was driven by average selling price increases of 9% and unit increases of 4%. In Q1 twenty twenty five, we posted a 69.2% gross margin. Speaker 100:05:56The 60 basis point increase year over year was driven primarily by higher ASPs and lower inventory scrap, offset by product mix. Average selling price increases improved the gross margin by approximately two seventy basis points in Q1. Reduced scrap contributed an additional 85 basis points. The shift in product mix, particularly towards grafts, negatively impacted the gross margin by two twenty basis points. Operating expenses in Q1 twenty twenty five were 28,800,000 an increase of 16% versus Q1 twenty twenty four. Speaker 100:06:35The increase was driven largely by higher compensation expenses, including the addition of 21 more sales professionals and higher non compensated non compensation sales related expenses. Q1 twenty twenty five operating income increased 6% year over year to $12,600,000 an operating margin of 21%. Fully diluted EPS was $0.48 up 10%. We ended Q1 twenty twenty five with $302,500,000 in cash and securities, an increase of 2,800,000 in the quarter. Cash from operations generated $9,000,000 in the quarter. Speaker 100:07:15We paid $4,500,000 in dividends to shareholders and made the final deferred payment of $1,400,000 related to our 2019 CardioCel acquisition. As we turn to guidance, there are two additional topics that we have incorporated into our full year forecast. First, we have amicably wound down our porcine patch distribution agreement with Eulsha effective April 30 in order to focus on sales of our own biologics. In 2024, our hospital sales of ELEUTIA patches total approximately $5,000,000 This product exit will likely improve our organic growth rate and gross margin. Second, we'd like to address tariffs. Speaker 100:07:57In summary, we believe the company is comparatively well positioned as it relates to this issue. LeMaitre manufactures 100% of its products in The United States. And therefore, we have limited concerns related to U. S. Import tariffs. Speaker 100:08:12Approximately 25% of our cost of goods sold is for raw materials and components, of which approximately $2,000,000 is paid to foreign suppliers, largely to Australia. Simply stated, we are not big importers. As for the impact of potential retaliatory tariffs, approximately 40% of our sales are international. Since we generally compete in low rivalry markets, we anticipate low substitution risk and we believe we can raise prices to offset most potential tariffs. China accounted for less than 1% of our total annual revenue. Speaker 100:08:49The Chinese import tariffs currently in place will increase our Chinese cost of goods by almost $825,000 per year. We are implementing price increases on May 15 in China, which should offset half of these costs. We remain committed to a long term view of our business prospects in China. We generally believe that cooler mines will eventually prevail and most tariffs will recede in the long run, particularly on life saving medical devices. Overall, we feel well positioned with our U. Speaker 100:09:22S.-only manufacturing footprint, our U. S.-focused supply chain and our competitive positioning in foreign markets with our niche products and direct sales model. Therefore, we feel comfortable increasing our 2025 sales guidance despite trade tensions. Lemaitre continues to deliver broad based revenue growth with our differentiated products, direct to hospital model and growing commercial organization. We have raised our full year revenue guidance to $245,000,000 reflecting a continued robust sales performance and a benefit from the weaker U. Speaker 100:09:55S. Dollar, offset by the discontinuation of our Aleutia distribution agreement and a weaker outlook for our small China business. We have further updated our annual guidance for a gross margin of 69.6%, operating income of $57,700,000 and a midpoint guide on diluted earnings per share of $2.16 For more details, please see today's press release. With that, I'll turn it back over to the operator for questions. Operator00:10:23Thank Our first question is going to come from the line of Suraj Kalia with Oppenheimer and Company. Your line is open. Please go ahead. Speaker 300:10:48Hi, guys. Congrats on a strong quarter. This is Seamus on for Seamus today. Speaker 200:10:54Hi, Seamus. Speaker 300:10:56Hi. Just to start, you guys had a strong 1Q, you guys beat by a little over $2,000,000 but you raised the guidance by 7,000,000 Obviously, there's some moving pieces here. You guys have autograft clearance now, the Aleutia agreement cessation. I guess, what's giving you the confidence here early, especially with kind of the current things rolling around in the air in terms of tariffs and globally that's giving you the confidence to increase guidance so early in the year? Speaker 200:11:28Thanks for the great question, Seamus. This is George. Yeah, of course, you're pointing out so what gives us this confidence? There's a bunch of factors here. But maybe the first one that you pointed out was that we beat Q1 by a lot. Speaker 200:11:40So you got that going. That's already in the bag. The price hikes also are working better than anticipated. It was a big topic at the last call, but we came out and said we think The U. S. Speaker 200:11:52Price list was going to increase prices by 8%. And in Q1, we got an 11% in The U. S. So we got a little bit better than we expected with those pricing floors. Interestingly enough, getting out of the Aleutia business will help organic growth in the year because it was reducing over time. Speaker 200:12:14It never really worked that well inside of our bag of goods. And so getting rid of that oddly increases organic growth. You can see also we're sort of quote guiding more sales reps than on the last call. We were guiding 165 for the end of this year on February 27. And now come May 1, we're guiding 170. Speaker 200:12:35So we're putting on more reps, and we think that will lead to additional sales growth. Obviously, you pointed out also the ArteGraft International. It's starting to work internationally. And then on Tuesday, we got the approval, the big one we've been waiting for, which is the CE mark for autograft. And then just in general, Europe is going so well these days for a variety of reasons, both price and units and all these offices we keep putting in seem to help out with growth. Speaker 200:13:04So I would say that's a lot that's a big long laundry list for your question, but that's sort of why we feel comfortable going from 10% to 13% organic. Speaker 300:13:15Got it. Appreciate all that helpful color. And then just kind of one more and we'll hop back in queue. Can you give us any update on M and A, what you're seeing? And then George, I can't help but at least clarify this. Speaker 300:13:30You noted that you guys have $3.00 $3,000,000 of cash, and it provides strategic optionality. So I feel like there's something there that you're maybe hinting at kind of behind the scenes, if you can give us any what you may mean by that. Thank you. Speaker 200:13:44Okay. Really quickly, I'll say I'm not hinting at anything. I just feel like if you have $300,000,000 in the bank, you can do stuff with it. So there's nothing underneath that. But I'll pass it over to Dave, who usually handles the M and A question, Seamus. Speaker 400:13:57Hey Seamus, great to hear from you. Yes, the pipeline is in really good shape. Obviously, we're still hunting in the center of the fairway for us, which is open vascular surgery, there are 22 or 23 targets, over five million of Revika. But we're also actively hunting in an adjacent space cardiac surgery where there are crossover devices and some cardiac surgeons do vascular surgery. I'd say, of course, like I said in previous calls, we're hunting for larger deals. Speaker 400:14:30Our last deal was almost five years ago, ArtaGraft, and we're obviously delighted with how that's gone. But we're hunting for larger deals and hence we've done we did the bond offering in December. The sweet spot probably has revenues of 15,000,000 to $150,000,000 or something like that worth of revenue. Operator00:15:06Our next question comes from the line of Michael Podusky with Barrington Research. Your line is open. Please go ahead. Speaker 500:15:13Hey, good evening. George, I'm curious, any view on XenoSure in China Speaker 300:15:20and just all the sort of Speaker 500:15:21the strain in this relationship? Do you have any concerns that this hangs it up? Or is there any intelligence that you might have on that sort of relative to that issue? Speaker 200:15:32Right. It's a great question, Mike. Thanks a lot. I feel like the whole project just took a, I don't know, a five yard sack, if you will, not just ZenaSure, but the whole China LeMay. And as you can remember, two years ago, we were in here saying how bad China was. Speaker 200:15:51And then in the last year, it sort of really turned around for us. We had a fantastic Q1, if you remember. And so, it's frustrating, but we've been there ten years. We call it the long march, We plan to continue being there. It will hurt us a little bit, but I bet you in the long run some of this stuff simmers down. Speaker 200:16:16I think it'll be okay. Speaker 400:16:17And Mike, it's Dave. Obviously, we were delighted to get that XenoSure cardiac approval back in December. And so for us, despite all the tariff and trade tension and all that, our team is actively seeking provincial listing approvals in the 31 provinces there. We expect to get most of those in Q4. Of course, the material sales wouldn't appear probably until next year sometime. Speaker 400:16:46But yes, let's just see what happens between the countries. But in the meanwhile, we're preparing to move ahead with that product line. Speaker 500:16:55Okay. All right. Great. And Dorian, curious if you have this handy. Do you have cash flow from ops and CapEx this quarter by any chance? Speaker 100:17:06Sure, Mike. Cash flow from ops was $9,000,000 and within that depreciation and amortization was $2,552,000 share based comp was $2,046,000 and capital expenditures for the quarter was 1,383,000.000 Speaker 500:17:26And cash flow from ops was like roughly $90,000,009,000,000 Speaker 100:17:31dollars correct. Speaker 500:17:33Awesome. Thank you so much. JJ always was good with having that handy. I really appreciate you doing the same. I'll get back in the queue at this point. Speaker 500:17:43Thanks. Thank you guys. Appreciate it. Speaker 200:17:46Thanks a lot, Mike. Operator00:17:51And our next question is gonna come from the line of Rick Wise with Stifel. Your line is open. Please go ahead. Speaker 600:17:58Thank you. Good afternoon, everybody. Hi, George. Just to start off on your pricing commentary. I mean, clearly, as you said, price was stronger, better than expected. Speaker 600:18:15And maybe I'm misremembering, please correct me obviously if I'm wrong. I feel like that the last call, we were thinking about more of a 6% blended price increase for the year. So given the first quarter performance and whatever the guidance was before, how are we how do you want us to think about price or price and volume as we break it down and think about the full twenty five year? Speaker 200:18:45Okay. And then I know I'm going to come to an unsatisfactory answer to this question, but I'm going to get there in a second. Just to go at, I think the difference between your 6% number and my 8% number that I just mentioned was I'm talking U. S. Only, and we were trying to use that as a proxy, as a simple proxy. Speaker 200:19:03You might have blended worldwide as 6%. You might remember that from the last call. Speaker 400:19:09I do. But regardless of Speaker 200:19:10what either of us regardless of where we remember it, the raw fact is in Q1, it was a 9% price increase and a 4% unit increase. We always have an eye towards having better unit growth, but it's a nice number anyway. So 94% was what we got in Q1. I sort of talk it through now to just go back to The U. S. Speaker 200:19:32Our list price increase was 8.1% blended in The U. S. And we think we got an 11% I think we got an 11%. So we a little bit more price discipline than we expected, I guess, is what I would say. As for the back of your question about price and volume for the year, it's almost impossible for us to get what the organic growth is. Speaker 200:19:57It's so hard. We don't really try to break it between price and units. Perhaps you could assume status quo as the year goes by. I don't have any reason to think it's not status quo, and that's nine and four is the 13 for Q1, but I don't know about the next three quarters. Speaker 600:20:16Got you. That's helpful. And I was hoping you'd expand on the excellent news about the autograft CE Mark approval. How do we think about the contribution from autograft in Europe? What kind of incremental volumes should that offer? Speaker 600:20:37What's baked into your guidance? Just maybe some additional color there would be helpful. Speaker 200:20:41Sure. That makes a lot of sense. It's why we gave you that international number, which is without Europe so far. So in the first sort of real quarter of selling internationally, we've 180,000. We've pumped into our model a number, which it's so preliminary, but we wrote it in, it's EUR 350,000 for the back three quarters of this year. Speaker 200:21:03But honestly, Rick, I think I'd love for you guys to give us a quarter or two to get our sea legs on this product. And then I think we'll be a lot better at guiding perspective on that. And then, of course, as you remember, I'm going to not want to guide on individual devices at some point, but I realize we all need more information around this. What does it mean? Another way to look at it is we keep saying there's an $8,000,000 market in Europe and an $8,000,000 market rest of world. Speaker 200:21:33Another way to look at it, which we keep trying to juxtapose with that number is we sold $37,000,000 of it in The US. If you take a really high level look at it, I don't know, maybe in ten years, you're selling half of that or a fourth of that. I don't know. They have different practice patterns over there. It's a long run. Speaker 200:21:52I hope I'm answering part of your question. Do you want to poke away at any of that, Rick? Any other further comments on my answer? Speaker 600:22:01No, no. No, that's great perspective. I will sneak in another small question about gross margin if I could. Thank you, Dorian, for the gross margin breakdown. And help us think about the graft drag. Speaker 600:22:18Obviously, price was a positive scrap good contributed. But is this mix drag? Is there anything that's going to change as the year unfolds? And just maybe just give us some color about how gross margins we should think about it as the year unfolds, as the quarters unfold for the year as well. Thank you. Speaker 100:22:45Yeah, and the allograft product in particular is the component of mix that is you can think of as being below the corporate average margin. Obviously, we've continued to see great growth in that product line. George mentioned that we've got a 23% compound annual growth rate since the acquisition there. But it is a little bit different product, the human tissue. And so the great growth there, and we will hopefully see that as well in 2026 with the approvals that we see coming in Europe, the investments that we're making. Speaker 100:23:25So that was the big contributor from a graph perspective on the mix. Speaker 600:23:34Gotcha. Thank you. Operator00:23:37You. One moment as we move on to our next question. Next question comes from the line of Michael Saccone with Jefferies. Your line is open. Please go ahead. Speaker 700:23:47Good afternoon and thanks for taking our questions. Just to follow-up on Rick's question, just to make sure I'm clear. So just on the 1Q gross margin and operating margin coming in below guidance. Is it fair to read that as allograft kind of performed better than expected and that's what drove the below guide margins? Speaker 100:24:16Yeah, I think just graphs overall as a category performing as high as they did is what drove that mix component. Speaker 400:24:25And Mike, would add, it's Dave Roberts. And within that, as Dorian mentioned, allograft has been an important growth driver for us over many quarters, and it did outperform in Q1 by about $1,000,000 And so that I'd say was the primary driver of the gross margin miss from a product standpoint. Speaker 700:24:49Got it, that's helpful. And then just on gross and operating margin for the full year, it looks like the guide came down modestly for gross margin, but you're taking up your operating margin guidance at the midpoint. Can you just kind of elaborate on the moving pieces there? Speaker 200:25:07Yes. I mean, there's a lot to that, right? We have such a nice sales growth guidance and yet the operating margin moves down from 25% to 24% for the full year. That's what you're getting at, right, Mike? What's the component of that? Speaker 200:25:22So as you already alluded to, we missed we're pulling down our gross margin guidance ever so slightly for the year because we got a 69.2% in Q1. A little nervous about what does that mean. And so I think we're now what are we at 69.6 is the guide. Yeah, okay. So 69.6% for the yearly guide. Speaker 200:25:41So that's involved in it too. I would go back and think about this 24% op margin is a crazy high op margin. And it gets affected. It's pretty rare to see a company with that op margin. So anything you do upsets that op margin. Speaker 200:25:57Maybe one thing that you can see us doing here on this call is we've increased our quote guidance, I don't know what you call it, from 165 sales reps at year end to 170. So I think our sort of bullishness that we're seeing with sales and with the success of this commercial build out, I think we're saying, hey, let's add five more to this. And I think maybe you're seeing some of that in the op margin. And then finally, of course, a Swiss office doesn't come cheap. We continue to learn. Speaker 200:26:26Clearly, the most expensive place to operate on the planet besides Tokyo. So you got a little bit of Swiss office in there too in some of these sales reps. Speaker 700:26:35Got it. Thank you very much. Operator00:26:39Thank you. And one moment for our next question. Our next question comes from the line of Frank Tarkinen with Lake Street Capital Market. Your line is open. Please go ahead. Speaker 800:26:52All right. Thanks for taking the questions. Congrats on all the progress. I wanted to also start with one on the sales force. Can you just remind us kind of ramp up time and then when we can see that convert to kind of operating leverage? Speaker 800:27:05I know the guidance implies that operating income starting to grow a little quicker through the back half of the year, but typically we've seen that really outpace the top line. So when can we see some of those reps start to contribute and then drive that impressive operating leverage profile you guys have shown? Speaker 200:27:21Thanks for the question, Frank. And just to put some numbers on what you're talking about H2, it looks like we are implying in the guidance that the op income growth gets back to 14% for H2. And I think it's a piece of what you're alluding to. As to how quick the reps get up and running, we've been answering this question for I've been answering for twenty years. I don't have a great answer. Speaker 200:27:43I will say that we've done a lot of what I'll call regression analysis and sales force analysis. And God knows, we have a lot of data around here now having run this sales force for so long. And I used to say to people, oh, it takes a year for people to ramp up. I don't feel that way anymore. I think it's quicker than that. Speaker 200:28:01And I think that it's extremely hard to distinguish between a rep that's been here two quarters, this is shocking, and one that's been here for five years. The performance to quota is indistinguishable for those two cadres of employees. So that's an odd answer, it's a surprising answer, but those are the numbers that keep showing up and we've been looking at this for two and three years now. It's not going away, that's what we see. I think it's maybe unfortunately, I know there are sales reps on this phone call and I hate to do this, but maybe it's a little bit of the warm body hypothesis. Speaker 200:28:33When you put a rep in Cleveland, they're going to sell whether they're six years into this or two months into this thing, they're going to sell stuff. I hope that helps. It's odd data, I will admit. Speaker 800:28:44No, that's helpful. Thank you. And then maybe one for Dave, just on the M and A front with kind of med tech valuations and all publicly traded valuations coming in for that matter. Does this change your thought process at all? And maybe you can get a more novel, bigger market device rather than smaller niche products that you've traditionally gone after at a more attractive valuation? Speaker 400:29:11I mean, I would say it doesn't change our strategy so much, Frank. I mean, the types of targets that we're hunting at all starts with the markets they're in and making sure those are markets we're in and their synergy and all that. Of course, when valuations come down, it makes targets more affordable. So and we're likely to have $300 plus million of cash in the bank. So from that standpoint, maybe we can get more with our money. Speaker 400:29:40But in terms of does it change the types of things we're looking at, I would say no, it doesn't really. Speaker 800:29:49Okay. That's helpful. I'll hop back in queue. Thank you. Speaker 200:29:53Thanks, Frank. Operator00:29:54Thank you. One moment for our next question. Our next question is going to come from the line of Jim Sidoti with Sidoti and Co. Your line is open. Please go ahead. Speaker 900:30:04Hi, good afternoon. Thanks for taking the question. So I'm going to ask the operating margin question a different way. For the quarter that just ended, margin was about 21%. You're guiding for 24% for the full year. Speaker 900:30:20What changes in the back half of the year that gets that up? Speaker 200:30:24I mean, one of the big topics here is easier comps excuse me, that's not I apologize. I'm off on a different answer here. What changes I mean, the sales ramp helps you a lot, right? And the gross margin ramp, the implied gross margin ramp, I think the H2 implied gross margin is now 69.9% for the last two quarters. So I think you get a lot in that those second two quarters, the last two quarters of the year that yes, Dorian can add to that. Speaker 100:30:51And the dropping out of the Aleutia distribution agreement, where we only were earning distribution margins, not the full manufacturing margins that we earn on our own biologics, that does have a nice pickup on the gross margin percentage for us in the back half of the year. So that's one of the lifts for us, Jim. Speaker 900:31:13Okay. All right. That makes sense. The other question I had is, in the past, when you said you're going to add 10 sales folks in a year, usually it's maybe one or two at the beginning of the year and it builds up during the year. This year, you seem to add a lot right in the first quarter. Speaker 900:31:30Is that due to the transition from distributors to direct? Are those folks folks that have already been selling your product? Speaker 200:31:40Jim, not really. We put in place a big surge last July, and it really is just that surge kind of coming to fruition. And it's always longer than you think. I would have guessed it would have happened. You remember I was missing my sales rep guidance in Q4. Speaker 200:31:58And I think the bolus of reps came in Q1, not in Q4, and I kind of missed it by three months. So this is just that old surge finally coming to fruition. Speaker 900:32:10All right. And then the last one for me. You have that share buyback program open. Have you started buying shares back? Speaker 200:32:23I don't know how we're supposed to answer that. You know Dorian? We have not bought any shares back as of today. Okay. Speaker 900:32:31All right. Thank you. Operator00:32:33Thank you. And one moment for our next question. Our next question comes from the line of Brett Fishman with KeyBanc Capital Markets. Your line is open. Please go ahead. Speaker 1000:32:45Hey, guys. Good evening. Thanks for taking the questions. Just a couple like more clarification ones. So on the tariffs, very helpful in terms of like laying out some of the key considerations. Speaker 1000:32:57And I'm really just trying to clarify what has been incorporated into the guidance. I know you were talking about like $8.25 ks of extra COGS related to the small China component and then maybe something like more modest around the raw materials and components. I'm just curious, like, if that's like actually factored in specifically into some of the margin assumptions? Speaker 100:33:18So yes, it has been factored in. That 8.25% was an annualized number for China that we gave you. And we if you noted, we're increasing prices in China here in two weeks to recoup about 50% of that where we have the ability to do that on the differentiated products. And that's the real significant impact for us on the back half of the year. We do have the ability to reprice products if we see tariffs, retaliatory tariffs. Speaker 100:33:53The timing of that may not be perfect, but we've incorporated our best estimates into guidance for how we view the rest of the year on this issue. Speaker 1000:34:05All right, helpful. And then second question is just on the Alludia or Alludia, sorry, the pronunciation on the distribution announcement that you're stepping away. And I was just curious like how you're looking at that as an organic growth tailwind. Is it more just like extra time like you're not focusing on that product as much? Yes, just trying to kind of like figure out how exiting $5,000,000 of revenue becomes a tailwind. Speaker 1000:34:30Thank you very much. Speaker 200:34:32Sure. I think this is simple, which is the product is declining year over year in our hands, and the sooner we get it out of our hands, the less it's going to negatively impact our organic growth rate. Speaker 400:34:43Yes, Brett, when we talk about organic and we're not selling in the future because we terminated the relationship or agreed to with Alusha, for the organic math, we pulled the sales a year ago out of the denominator, and that helps us. But you're also bringing up a good point. And I think this was part of the issue with the product and LeMaitre is that it was the third patch inside of the LeMaitre bag. So the LeMaitre reps will be able to focus more on the other products and that could make a contribute to organic growth as well. Speaker 1000:35:20All right. Thank you very much. Speaker 200:35:22Thanks, Thank Operator00:35:24you. One moment for our next question. Our next question comes from the line of Ross Osborne with Cantor Fitzgerald. Your line is open. Please go ahead. Speaker 1100:35:35Hey guys. Congrats on the strong quarter. So almost halfway through the year at this point, so I'll try and squeeze in some questions on 2026, but we'll stay away from numbers at this point. So starting with autograft, congrats on CE Mark. And so following that approval, what steps do you guys need to take from an operational or generating incremental clinical data standpoint this year in order to set yourselves up for a strong 2026 ramp? Speaker 200:36:04And you're specific thanks a lot, Ross. This is George. And you're specifically referring to the autograft project? Speaker 1000:36:11Yes. Speaker 200:36:12Okay, okay, great. Nothing, we don't owe anything to anyone. We're ready to go. This is just a marketing launch. We'll probably do some kind of, just in terms of running clinical looks at it at some point, but we don't have anything planned right now. Speaker 200:36:28We're just going at it. It's a nice launch. The device comes to us or came to us in 2020 with lots and lots of clinical data and lots of articles, so there's no real need to go do more of that. In fact, that's probably why the thing went so quickly in the regulatory pipeline and did not require a clinical trial. Speaker 400:36:47Ross, I would add, it's Dave. Great to hear from you. We actually are shipping, I mean, we're just making our initial shipment from The US to Europe next week, because obviously we couldn't ship until we had the CE mark, and now we've got it. So obviously step one is to place inventory over there. We've already begun training with our US Sales Reps who are expert and facile with autograft. Speaker 400:37:18They've started the training of our European team. But George is right, there's already an enormous amount of clinical data about this product, so there's no generation of clinical data need to launch this product line. Speaker 1100:37:34Okay, perfect. And then turning to RestoreFlow, would you walk through any different market dynamics that may exist between The US versus Germany and Ireland, whether that be price or certain training, such as the return to Ross procedure here as we came to Mount Sinai? And then, how many reps do you think you'll need in those markets, to support adoption? Speaker 100:37:58Okay. I'll go to the the back of Speaker 200:38:00the question. It's a lot simpler, which is I think we have the reps already in place. You don't need to hire additional reps. It's the beauty of this thing. It goes down our sales channel. Speaker 200:38:09So with that out of the way, I would say we have seen a big difference between The U. S. And The U. K. And it's specific sorry, I know you're talking Ireland and Germany, but we're going to learn about that soon. Speaker 200:38:20I feel like they're very different markets. In The UK, it's very much a cardiac approach. Canada is also more cardiac for us, and The US has been more peripheral vascular. So yes, they're going to be different they're all going be different markets. And I think we're going to as we get closer and closer to these launches, we'll be tailoring whether we're to bring more peripheral over there or more cardiac over there. Speaker 200:38:42Inside of this call, we also mentioned there's a nugget in there, which is we're opening up a distribution site in Ireland, in Dublin in the back half of the year. And that should help us once we get approvals in other countries have sort of a pan European approach to that one product, not the other products which are generally shipped out of Frankfurt. Speaker 400:39:04Ross, I'd piggyback on George's comments, and by the way, I'd also say thank you to you and Matt and Cantor for that nice deep dive piece on restorable allografts. You guys did a really thoughtful job with that. At a high level, George is right, we've seen a lot of success in The UK, and part of the reason for that is unlike The US, there aren't companies who are providing allografts and providing them to hospitals. It's a fairly disorganized system in The UK, and we think that's true across Europe more generally. So regardless of the door through which we enter the European market, whether it's Ireland, which opens a lot of countries' doors for us inside the EU, or Germany, which opens fewer but still opens some, the markets that we see ourselves entering are equally fragmented from a supply standpoint. Speaker 400:40:02So we do see a lot of opportunity there. Frankly, I believe, as you and I discussed in Chicago A Month And A Half ago, the biggest challenge for LeMaitre will be providing enough grafts and tissues in Europe to meet the demand. Speaker 1100:40:21Sounds great. Thank you for taking our questions, and congrats again on the progress. Speaker 200:40:26Thanks, Ross. Operator00:40:27Thank you. One moment for our next question. Our next question comes from the line of Danny Stauder with Citizens JMP. Your line is open. Please go ahead. Speaker 1200:40:38Yes, great. Thanks for the questions. Just first one on the sales and marketing spend. It was up a little bit or quite a bit in the first quarter, and I'm assuming that was due to the large step up in the reps. But I was just curious if there were any expenses that were more one time in nature there, such as signing bonuses or anything like that? Speaker 1200:40:57And how should we think about this sales and marketing expense going forward in 2025? Thank you. Speaker 200:41:04Sure. Danny, thanks for the question. This is George. So first of there is a discrete a big guy discrete one, which is there's about $1,000,000 sales meeting almost always that happens in Q1. So it's not a year over year difference for you. Speaker 200:41:17But in terms of looking forward into the year, there's about $1,000,000 of sales meetings that you kick off meetings that you don't need to have for the next three quarters. So there's one thing. And then you alluded to it, but I think it's maybe it's worth going through here. But at the end of Q1 of twenty twenty four, we had 137 reps. And today, as I sit here, we have 164 reps. Speaker 200:41:40It's an increase of 27. So this is a big change, and I think you can feel that in Q1 op expenses, particularly around sales and marketing. So you're right to point that out, but those are the numbers that would support what you're pointing out. Speaker 1200:41:56Great. Thank you for that. And then just one follow-up, looking at free cash flow. In terms of 2025, you talked about this a little bit, but how should we think about CapEx and working capital, specifically inventory as we consider some of these regulatory approvals and geographical expansions? Thank you. Speaker 100:42:17Thanks for the question. I think on CapEx, you consider that to be this quarter to be a fairly standard quarter for us, maybe a little more around some of the offices that are coming online and continue to build outs for the end of the year, but not a big sequential change. Overall, on free cash flow, continue to deliver cash to the bottom line. Speaker 200:42:48Danny, I'd also point out here, we've had this really, I call it lavish policy around here called no back orders at any time. And we're that guy. We always want to have the devices. And it's led us to have a pretty big inventory closet, roughly $65,000,000 worth of inventory in our mostly in Burlington here in Massachusetts, but also around the world in our 13 or 15 offices. We're now finally going after that in terms of we're going to try to be a little bit tighter at titrating back orders and the giant inventory balance. Speaker 200:43:24So you may see some cash free up from that this year, and it could add to some of this free cash flow. Yes. Speaker 100:43:31And in Q1, remember that it's usually a light cash flow quarter for us because you had annual bonuses being paid in Q1. And just maybe the last point on inventory is, in Q1, we were building inventory, particularly in ArteGraft and in RestoreFlow in anticipation of this European launch for ArteGraft and because we do believe that long term supply is one of our constraints on growing the RestoreFlow business. Other than those two product categories, we are seeing the inventory progress there and should be able to free up cash flow subsequent quarters. Speaker 1200:44:11Great. Thank you very much for the questions. Speaker 200:44:15Thanks, Danny. Operator00:44:16Thank you. And one moment for our next question. We have a follow-up question from the line of Michael Podusky Your line is open. Please go ahead. Speaker 500:44:27Hey, thanks so much. Just a couple of quick ones. I may have missed this. George, did you say how many of the, I think, three MDR CE marks that you're looking to get, where you stand on that? Is it 17 at this point, 18? Speaker 500:44:39I missed it Speaker 200:44:40if you said it, I You're good. It is 17 out of 23. Speaker 500:44:4517. Okay, great. And then just one for Dave as well. Dave, in any of the conversations, say, over the last month or so with assets that you're interested in, have you seen anybody where they're essentially saying, hey, we're not doing anything until some of this tariff stuff is resolved? Or we're more anxious to do something because of the screwed up nature of trading relationships. Speaker 500:45:10Like have you heard any feedback either way? I'm just curious. Thanks. Speaker 400:45:15Yes, my short answer is no. I think there's a general sentiment that things are still changing a lot. And so I feel like sellers aren't at one extreme or another saying, we're frozen, we're not doing anything or let's hurry up and dump this asset. I feel like everybody is fairly circumspect about it. And there so far, discussions are generally proceeding, but we've all got an eye on it. Speaker 400:45:44No question. Speaker 500:45:46Okay. All right. Great. Thanks, guys. Operator00:45:50Thank you. Ladies and gentlemen, this concludes today's conference call. I would like to thank you all for your participation. You may now disconnect and have a great day. Speaker 1100:46:02Thanks a lot.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallLeMaitre Vascular Q1 202500:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsPress Release(8-K) LeMaitre Vascular Earnings HeadlinesLeMaitre Q1 2025 Financial ResultsMay 1 at 4:17 PM | globenewswire.com7LMAT : A Look at LeMaitre Vascular's Upcoming Earnings ReportApril 30 at 7:10 PM | benzinga.comHere’s How to Claim Your Stake in Elon’s Private Company, xAII predict this single breakthrough could make Elon the world’s first trillionaire — and mint more new millionaires than any tech advance in history. And for a limited time, you have the chance to claim a stake in this project, even though it’s housed inside Elon’s private company, xAI.May 1, 2025 | Brownstone Research (Ad)Earnings To Watch: LeMaitre (LMAT) Reports Q1 Results TomorrowApril 30 at 4:27 AM | msn.comLeMaitre Vascular (LMAT) Expected to Announce Quarterly Earnings on ThursdayApril 30 at 3:20 AM | americanbankingnews.com1 Profitable Stock with Impressive Fundamentals and 2 to Steer Clear OfApril 28 at 12:56 PM | msn.comSee More LeMaitre Vascular Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like LeMaitre Vascular? Sign up for Earnings360's daily newsletter to receive timely earnings updates on LeMaitre Vascular and other key companies, straight to your email. Email Address About LeMaitre VascularLeMaitre Vascular (NASDAQ:LMAT) develops, manufactures, and markets medical devices and implants used in the field of vascular surgery worldwide. It offers human cadaver tissue cryopreservation services; angioscope, a fiberoptic catheter used for viewing the lumen of a blood vessel; embolectomy catheters to remove blood clots from arteries; thrombectomy catheters for removing thrombi in the venous system; occlusion catheters that temporarily occlude the blood flow; and perfusion catheters to perfuse the blood and other fluids into the vasculature. The company also provides artegraft biologic graft, a bovine carotid artery used for dialysis access; XenoSure biologic patches, used for closure of vessels after surgical intervention; VascuCel and CardioCel biologic patches, used in vessel repair, heart repair and reconstruction, and neonatal repairs; cardiovascular patches; carotid shunts that temporarily shunt the blood to the brain during the removal of plaque in a carotid endarterectomy surgery; biosynthetic vascular graft indicated for lower extremity bypass and dialysis access; and vascular grafts used to bypass or replace diseased arteries. In addition, it offers radiopaque tape, a medical-grade tape applied to the skin that enables surgeons and interventionalists to cross-refer between the inside and the outside of a patient's body and allows them to locate tributaries or lesions beneath the skin. Further, the company provides valvulotomes, which cut or disrupt valves in the saphenous vein to function as an artery to carry blood past diseased arteries to the lower leg or the foot; and closure systems to attach vessels to one another with titanium clips instead of sutures. It markets its products through a direct sales force and distributors. The company was formerly known as Vascutech, Inc. and changed its name to LeMaitre Vascular, Inc. in April 2001. LeMaitre Vascular, Inc. was incorporated in 1983 and is headquartered in Burlington, Massachusetts.View LeMaitre Vascular ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Microsoft Crushes Earnings, What’s Next for MSFT Stock?Qualcomm's Earnings: 2 Reasons to Buy, 1 to Stay AwayAMD Stock Signals Strong Buy Ahead of EarningsAmazon's Earnings Will Make or Break the Stock's Comeback CrowdStrike Stock Nears Record High, Dip Ahead of Earnings?Alphabet Rebounds After Strong Earnings and Buyback AnnouncementMarkets Think Robinhood Earnings Could Send the Stock Up Upcoming Earnings Apollo Global Management (5/2/2025)The Cigna Group (5/2/2025)Chevron (5/2/2025)Eaton (5/2/2025)NatWest Group (5/2/2025)Shell (5/2/2025)Exxon Mobil (5/2/2025)Palantir Technologies (5/5/2025)Vertex Pharmaceuticals (5/5/2025)CRH (5/5/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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There are 13 speakers on the call. Operator00:00:00Welcome to the Lomate Vascular First Quarter twenty twenty five Financial Results Conference Call. As a reminder, today's call is being recorded. At this time, I would like to turn the call over to Mr. Dorian LeBlanc, Chief Financial Officer of Lemaitre Vascular. Please go ahead, sir. Speaker 100:00:18Thank you, operator. Good afternoon, and thank you for joining us on our Q1 twenty twenty five conference call. With me on today's call is our CEO, George Lemaitre and our President, Dave Roberts. Before we begin, I'll read our Safe Harbor statement. Today, we will make some forward looking statements within the meaning of The U. Speaker 100:00:37S. Private Securities Litigation Reform Act of 1995, the accuracy of which is subject to risks and uncertainties. Wherever possible, we will try to identify these forward looking statements by using words such as believe, expect, anticipate, pursue, forecast and similar expressions. Our forward looking statements are based on our estimates and assumptions as of today, 05/01/2025, and should not be relied upon as representing our estimates or views on any subsequent date. Please refer to the cautionary statement regarding forward looking information and the risk factors in our most recent 10 ks and subsequent SEC filings, including disclosure of the factors that could cause results to differ materially from those expressed or implied. Speaker 100:01:22During this call, we will discuss non GAAP financial measures such as organic sales growth. A reconciliation of GAAP to non GAAP measures discussed in this call is contained in the associated press release and is available in the Investor Relations section of our website, www.lemaitre.com. I'll now turn the call over to George Lemaitre. Speaker 200:01:43Thanks, Dorian. Q1 sales were stronger than our February 27 guidance. 13% organic and 12% reported growth was led by grafts, up 17% and carotid shunts, up 14%. We posted sales records in all five of our categories: grafts, carotid shunts, catheters, valvulotomes and patches. By geography, EMEA was up 18%, the Americas eleven % and APAC 3 Percent. Speaker 200:02:11I'll focus my remarks on three topics: first, the growth of our sales force second, our new international sales offices and finally, our MDR CE marks. We currently have 164 reps on payroll, and we're now targeting 170 at year end. We also employ 34 sales managers versus 31 at our last earnings call. The sales force is our number one asset, so we continue to invest in reps, managers and sales offices. Our new Alpine Regional Sales Manager started on April 1 and will oversee seven sales reps in Switzerland, Austria and Czechia. Speaker 200:02:48Shipping from our new Zurich office will reduce customs complexity for Swiss hospitals, and our direct offices almost always improve sales performance. Switzerland is LeMaitre's sixth largest European market. We expect to sign a transition agreement with our Czech distributor shortly and should log our First Direct sale in August. And we are currently recruiting two Czech reps. As for Portugal, we hired our Lisbon Rep on January 1, signed our distributor transition agreement on March 19, and on May 1, became direct in Portugal. Speaker 200:03:22Also in Europe, we've just received our MDR CE mark for autograft, and the European launch will begin presently. Autograft, a biologic graft used primarily in AV access and peripheral bypass, was the company's largest U. S. Product in 2024 with $37,000,000 in U. S. Speaker 200:03:39Sales. At previous earnings calls, we've estimated autograft's current market size to be about $8,000,000 in Europe and $8,000,000 rest of world. We currently have autographed approvals in New Zealand, South Africa, Thailand, Israel and Malaysia. We sold $180,000 of autographs internationally in Q1. We also expect to receive approvals in Australia, Canada, Singapore and Korea by H1 twenty twenty six. Speaker 200:04:05So this is an exciting worldwide launch with plenty of long run upside. Our New Jersey autograph production facility is currently running a single shift and is capable of meeting this new demand. Separately, we continue to anticipate at least one RestoreFlow allograft approval in 2025 from Ireland or Germany. As a reminder, allografts require approval on a country by country basis. Approvals from either Ireland or Germany would then expedite our individual European country approvals. Speaker 200:04:36Anticipating the Irish approval, we'll be opening a pan European RestoreFlow distribution facility in Dublin in H2. RestoreFlow is currently approved in The U. S, The U. K. And Canada. Speaker 200:04:48Since the 2016 acquisition, RestoreFlow's sales CAGR has been 23%. In summary, Q1 sales momentum, our continued office and sales force build out and our regulatory progress allow us to increase our 2025 reported sales guidance to $245,000,000 from $239,000,000 previously, and our organic sales guidance has advanced to 13% from 10% previously. Dollars $3.00 3,000,000 of cash also provides strategic optionality. With that, I'll turn the call over to Dorian. Speaker 100:05:26Thanks, George. The LeMaitre portfolio of niche devices continues to deliver in Q1. As George referenced, we experienced record quarterly sales in grafts, carotid shunts, catheters, valvulotomes and patches. Organic sales growth of 13% over Q1 twenty twenty four was driven by average selling price increases of 9% and unit increases of 4%. In Q1 twenty twenty five, we posted a 69.2% gross margin. Speaker 100:05:56The 60 basis point increase year over year was driven primarily by higher ASPs and lower inventory scrap, offset by product mix. Average selling price increases improved the gross margin by approximately two seventy basis points in Q1. Reduced scrap contributed an additional 85 basis points. The shift in product mix, particularly towards grafts, negatively impacted the gross margin by two twenty basis points. Operating expenses in Q1 twenty twenty five were 28,800,000 an increase of 16% versus Q1 twenty twenty four. Speaker 100:06:35The increase was driven largely by higher compensation expenses, including the addition of 21 more sales professionals and higher non compensated non compensation sales related expenses. Q1 twenty twenty five operating income increased 6% year over year to $12,600,000 an operating margin of 21%. Fully diluted EPS was $0.48 up 10%. We ended Q1 twenty twenty five with $302,500,000 in cash and securities, an increase of 2,800,000 in the quarter. Cash from operations generated $9,000,000 in the quarter. Speaker 100:07:15We paid $4,500,000 in dividends to shareholders and made the final deferred payment of $1,400,000 related to our 2019 CardioCel acquisition. As we turn to guidance, there are two additional topics that we have incorporated into our full year forecast. First, we have amicably wound down our porcine patch distribution agreement with Eulsha effective April 30 in order to focus on sales of our own biologics. In 2024, our hospital sales of ELEUTIA patches total approximately $5,000,000 This product exit will likely improve our organic growth rate and gross margin. Second, we'd like to address tariffs. Speaker 100:07:57In summary, we believe the company is comparatively well positioned as it relates to this issue. LeMaitre manufactures 100% of its products in The United States. And therefore, we have limited concerns related to U. S. Import tariffs. Speaker 100:08:12Approximately 25% of our cost of goods sold is for raw materials and components, of which approximately $2,000,000 is paid to foreign suppliers, largely to Australia. Simply stated, we are not big importers. As for the impact of potential retaliatory tariffs, approximately 40% of our sales are international. Since we generally compete in low rivalry markets, we anticipate low substitution risk and we believe we can raise prices to offset most potential tariffs. China accounted for less than 1% of our total annual revenue. Speaker 100:08:49The Chinese import tariffs currently in place will increase our Chinese cost of goods by almost $825,000 per year. We are implementing price increases on May 15 in China, which should offset half of these costs. We remain committed to a long term view of our business prospects in China. We generally believe that cooler mines will eventually prevail and most tariffs will recede in the long run, particularly on life saving medical devices. Overall, we feel well positioned with our U. Speaker 100:09:22S.-only manufacturing footprint, our U. S.-focused supply chain and our competitive positioning in foreign markets with our niche products and direct sales model. Therefore, we feel comfortable increasing our 2025 sales guidance despite trade tensions. Lemaitre continues to deliver broad based revenue growth with our differentiated products, direct to hospital model and growing commercial organization. We have raised our full year revenue guidance to $245,000,000 reflecting a continued robust sales performance and a benefit from the weaker U. Speaker 100:09:55S. Dollar, offset by the discontinuation of our Aleutia distribution agreement and a weaker outlook for our small China business. We have further updated our annual guidance for a gross margin of 69.6%, operating income of $57,700,000 and a midpoint guide on diluted earnings per share of $2.16 For more details, please see today's press release. With that, I'll turn it back over to the operator for questions. Operator00:10:23Thank Our first question is going to come from the line of Suraj Kalia with Oppenheimer and Company. Your line is open. Please go ahead. Speaker 300:10:48Hi, guys. Congrats on a strong quarter. This is Seamus on for Seamus today. Speaker 200:10:54Hi, Seamus. Speaker 300:10:56Hi. Just to start, you guys had a strong 1Q, you guys beat by a little over $2,000,000 but you raised the guidance by 7,000,000 Obviously, there's some moving pieces here. You guys have autograft clearance now, the Aleutia agreement cessation. I guess, what's giving you the confidence here early, especially with kind of the current things rolling around in the air in terms of tariffs and globally that's giving you the confidence to increase guidance so early in the year? Speaker 200:11:28Thanks for the great question, Seamus. This is George. Yeah, of course, you're pointing out so what gives us this confidence? There's a bunch of factors here. But maybe the first one that you pointed out was that we beat Q1 by a lot. Speaker 200:11:40So you got that going. That's already in the bag. The price hikes also are working better than anticipated. It was a big topic at the last call, but we came out and said we think The U. S. Speaker 200:11:52Price list was going to increase prices by 8%. And in Q1, we got an 11% in The U. S. So we got a little bit better than we expected with those pricing floors. Interestingly enough, getting out of the Aleutia business will help organic growth in the year because it was reducing over time. Speaker 200:12:14It never really worked that well inside of our bag of goods. And so getting rid of that oddly increases organic growth. You can see also we're sort of quote guiding more sales reps than on the last call. We were guiding 165 for the end of this year on February 27. And now come May 1, we're guiding 170. Speaker 200:12:35So we're putting on more reps, and we think that will lead to additional sales growth. Obviously, you pointed out also the ArteGraft International. It's starting to work internationally. And then on Tuesday, we got the approval, the big one we've been waiting for, which is the CE mark for autograft. And then just in general, Europe is going so well these days for a variety of reasons, both price and units and all these offices we keep putting in seem to help out with growth. Speaker 200:13:04So I would say that's a lot that's a big long laundry list for your question, but that's sort of why we feel comfortable going from 10% to 13% organic. Speaker 300:13:15Got it. Appreciate all that helpful color. And then just kind of one more and we'll hop back in queue. Can you give us any update on M and A, what you're seeing? And then George, I can't help but at least clarify this. Speaker 300:13:30You noted that you guys have $3.00 $3,000,000 of cash, and it provides strategic optionality. So I feel like there's something there that you're maybe hinting at kind of behind the scenes, if you can give us any what you may mean by that. Thank you. Speaker 200:13:44Okay. Really quickly, I'll say I'm not hinting at anything. I just feel like if you have $300,000,000 in the bank, you can do stuff with it. So there's nothing underneath that. But I'll pass it over to Dave, who usually handles the M and A question, Seamus. Speaker 400:13:57Hey Seamus, great to hear from you. Yes, the pipeline is in really good shape. Obviously, we're still hunting in the center of the fairway for us, which is open vascular surgery, there are 22 or 23 targets, over five million of Revika. But we're also actively hunting in an adjacent space cardiac surgery where there are crossover devices and some cardiac surgeons do vascular surgery. I'd say, of course, like I said in previous calls, we're hunting for larger deals. Speaker 400:14:30Our last deal was almost five years ago, ArtaGraft, and we're obviously delighted with how that's gone. But we're hunting for larger deals and hence we've done we did the bond offering in December. The sweet spot probably has revenues of 15,000,000 to $150,000,000 or something like that worth of revenue. Operator00:15:06Our next question comes from the line of Michael Podusky with Barrington Research. Your line is open. Please go ahead. Speaker 500:15:13Hey, good evening. George, I'm curious, any view on XenoSure in China Speaker 300:15:20and just all the sort of Speaker 500:15:21the strain in this relationship? Do you have any concerns that this hangs it up? Or is there any intelligence that you might have on that sort of relative to that issue? Speaker 200:15:32Right. It's a great question, Mike. Thanks a lot. I feel like the whole project just took a, I don't know, a five yard sack, if you will, not just ZenaSure, but the whole China LeMay. And as you can remember, two years ago, we were in here saying how bad China was. Speaker 200:15:51And then in the last year, it sort of really turned around for us. We had a fantastic Q1, if you remember. And so, it's frustrating, but we've been there ten years. We call it the long march, We plan to continue being there. It will hurt us a little bit, but I bet you in the long run some of this stuff simmers down. Speaker 200:16:16I think it'll be okay. Speaker 400:16:17And Mike, it's Dave. Obviously, we were delighted to get that XenoSure cardiac approval back in December. And so for us, despite all the tariff and trade tension and all that, our team is actively seeking provincial listing approvals in the 31 provinces there. We expect to get most of those in Q4. Of course, the material sales wouldn't appear probably until next year sometime. Speaker 400:16:46But yes, let's just see what happens between the countries. But in the meanwhile, we're preparing to move ahead with that product line. Speaker 500:16:55Okay. All right. Great. And Dorian, curious if you have this handy. Do you have cash flow from ops and CapEx this quarter by any chance? Speaker 100:17:06Sure, Mike. Cash flow from ops was $9,000,000 and within that depreciation and amortization was $2,552,000 share based comp was $2,046,000 and capital expenditures for the quarter was 1,383,000.000 Speaker 500:17:26And cash flow from ops was like roughly $90,000,009,000,000 Speaker 100:17:31dollars correct. Speaker 500:17:33Awesome. Thank you so much. JJ always was good with having that handy. I really appreciate you doing the same. I'll get back in the queue at this point. Speaker 500:17:43Thanks. Thank you guys. Appreciate it. Speaker 200:17:46Thanks a lot, Mike. Operator00:17:51And our next question is gonna come from the line of Rick Wise with Stifel. Your line is open. Please go ahead. Speaker 600:17:58Thank you. Good afternoon, everybody. Hi, George. Just to start off on your pricing commentary. I mean, clearly, as you said, price was stronger, better than expected. Speaker 600:18:15And maybe I'm misremembering, please correct me obviously if I'm wrong. I feel like that the last call, we were thinking about more of a 6% blended price increase for the year. So given the first quarter performance and whatever the guidance was before, how are we how do you want us to think about price or price and volume as we break it down and think about the full twenty five year? Speaker 200:18:45Okay. And then I know I'm going to come to an unsatisfactory answer to this question, but I'm going to get there in a second. Just to go at, I think the difference between your 6% number and my 8% number that I just mentioned was I'm talking U. S. Only, and we were trying to use that as a proxy, as a simple proxy. Speaker 200:19:03You might have blended worldwide as 6%. You might remember that from the last call. Speaker 400:19:09I do. But regardless of Speaker 200:19:10what either of us regardless of where we remember it, the raw fact is in Q1, it was a 9% price increase and a 4% unit increase. We always have an eye towards having better unit growth, but it's a nice number anyway. So 94% was what we got in Q1. I sort of talk it through now to just go back to The U. S. Speaker 200:19:32Our list price increase was 8.1% blended in The U. S. And we think we got an 11% I think we got an 11%. So we a little bit more price discipline than we expected, I guess, is what I would say. As for the back of your question about price and volume for the year, it's almost impossible for us to get what the organic growth is. Speaker 200:19:57It's so hard. We don't really try to break it between price and units. Perhaps you could assume status quo as the year goes by. I don't have any reason to think it's not status quo, and that's nine and four is the 13 for Q1, but I don't know about the next three quarters. Speaker 600:20:16Got you. That's helpful. And I was hoping you'd expand on the excellent news about the autograft CE Mark approval. How do we think about the contribution from autograft in Europe? What kind of incremental volumes should that offer? Speaker 600:20:37What's baked into your guidance? Just maybe some additional color there would be helpful. Speaker 200:20:41Sure. That makes a lot of sense. It's why we gave you that international number, which is without Europe so far. So in the first sort of real quarter of selling internationally, we've 180,000. We've pumped into our model a number, which it's so preliminary, but we wrote it in, it's EUR 350,000 for the back three quarters of this year. Speaker 200:21:03But honestly, Rick, I think I'd love for you guys to give us a quarter or two to get our sea legs on this product. And then I think we'll be a lot better at guiding perspective on that. And then, of course, as you remember, I'm going to not want to guide on individual devices at some point, but I realize we all need more information around this. What does it mean? Another way to look at it is we keep saying there's an $8,000,000 market in Europe and an $8,000,000 market rest of world. Speaker 200:21:33Another way to look at it, which we keep trying to juxtapose with that number is we sold $37,000,000 of it in The US. If you take a really high level look at it, I don't know, maybe in ten years, you're selling half of that or a fourth of that. I don't know. They have different practice patterns over there. It's a long run. Speaker 200:21:52I hope I'm answering part of your question. Do you want to poke away at any of that, Rick? Any other further comments on my answer? Speaker 600:22:01No, no. No, that's great perspective. I will sneak in another small question about gross margin if I could. Thank you, Dorian, for the gross margin breakdown. And help us think about the graft drag. Speaker 600:22:18Obviously, price was a positive scrap good contributed. But is this mix drag? Is there anything that's going to change as the year unfolds? And just maybe just give us some color about how gross margins we should think about it as the year unfolds, as the quarters unfold for the year as well. Thank you. Speaker 100:22:45Yeah, and the allograft product in particular is the component of mix that is you can think of as being below the corporate average margin. Obviously, we've continued to see great growth in that product line. George mentioned that we've got a 23% compound annual growth rate since the acquisition there. But it is a little bit different product, the human tissue. And so the great growth there, and we will hopefully see that as well in 2026 with the approvals that we see coming in Europe, the investments that we're making. Speaker 100:23:25So that was the big contributor from a graph perspective on the mix. Speaker 600:23:34Gotcha. Thank you. Operator00:23:37You. One moment as we move on to our next question. Next question comes from the line of Michael Saccone with Jefferies. Your line is open. Please go ahead. Speaker 700:23:47Good afternoon and thanks for taking our questions. Just to follow-up on Rick's question, just to make sure I'm clear. So just on the 1Q gross margin and operating margin coming in below guidance. Is it fair to read that as allograft kind of performed better than expected and that's what drove the below guide margins? Speaker 100:24:16Yeah, I think just graphs overall as a category performing as high as they did is what drove that mix component. Speaker 400:24:25And Mike, would add, it's Dave Roberts. And within that, as Dorian mentioned, allograft has been an important growth driver for us over many quarters, and it did outperform in Q1 by about $1,000,000 And so that I'd say was the primary driver of the gross margin miss from a product standpoint. Speaker 700:24:49Got it, that's helpful. And then just on gross and operating margin for the full year, it looks like the guide came down modestly for gross margin, but you're taking up your operating margin guidance at the midpoint. Can you just kind of elaborate on the moving pieces there? Speaker 200:25:07Yes. I mean, there's a lot to that, right? We have such a nice sales growth guidance and yet the operating margin moves down from 25% to 24% for the full year. That's what you're getting at, right, Mike? What's the component of that? Speaker 200:25:22So as you already alluded to, we missed we're pulling down our gross margin guidance ever so slightly for the year because we got a 69.2% in Q1. A little nervous about what does that mean. And so I think we're now what are we at 69.6 is the guide. Yeah, okay. So 69.6% for the yearly guide. Speaker 200:25:41So that's involved in it too. I would go back and think about this 24% op margin is a crazy high op margin. And it gets affected. It's pretty rare to see a company with that op margin. So anything you do upsets that op margin. Speaker 200:25:57Maybe one thing that you can see us doing here on this call is we've increased our quote guidance, I don't know what you call it, from 165 sales reps at year end to 170. So I think our sort of bullishness that we're seeing with sales and with the success of this commercial build out, I think we're saying, hey, let's add five more to this. And I think maybe you're seeing some of that in the op margin. And then finally, of course, a Swiss office doesn't come cheap. We continue to learn. Speaker 200:26:26Clearly, the most expensive place to operate on the planet besides Tokyo. So you got a little bit of Swiss office in there too in some of these sales reps. Speaker 700:26:35Got it. Thank you very much. Operator00:26:39Thank you. And one moment for our next question. Our next question comes from the line of Frank Tarkinen with Lake Street Capital Market. Your line is open. Please go ahead. Speaker 800:26:52All right. Thanks for taking the questions. Congrats on all the progress. I wanted to also start with one on the sales force. Can you just remind us kind of ramp up time and then when we can see that convert to kind of operating leverage? Speaker 800:27:05I know the guidance implies that operating income starting to grow a little quicker through the back half of the year, but typically we've seen that really outpace the top line. So when can we see some of those reps start to contribute and then drive that impressive operating leverage profile you guys have shown? Speaker 200:27:21Thanks for the question, Frank. And just to put some numbers on what you're talking about H2, it looks like we are implying in the guidance that the op income growth gets back to 14% for H2. And I think it's a piece of what you're alluding to. As to how quick the reps get up and running, we've been answering this question for I've been answering for twenty years. I don't have a great answer. Speaker 200:27:43I will say that we've done a lot of what I'll call regression analysis and sales force analysis. And God knows, we have a lot of data around here now having run this sales force for so long. And I used to say to people, oh, it takes a year for people to ramp up. I don't feel that way anymore. I think it's quicker than that. Speaker 200:28:01And I think that it's extremely hard to distinguish between a rep that's been here two quarters, this is shocking, and one that's been here for five years. The performance to quota is indistinguishable for those two cadres of employees. So that's an odd answer, it's a surprising answer, but those are the numbers that keep showing up and we've been looking at this for two and three years now. It's not going away, that's what we see. I think it's maybe unfortunately, I know there are sales reps on this phone call and I hate to do this, but maybe it's a little bit of the warm body hypothesis. Speaker 200:28:33When you put a rep in Cleveland, they're going to sell whether they're six years into this or two months into this thing, they're going to sell stuff. I hope that helps. It's odd data, I will admit. Speaker 800:28:44No, that's helpful. Thank you. And then maybe one for Dave, just on the M and A front with kind of med tech valuations and all publicly traded valuations coming in for that matter. Does this change your thought process at all? And maybe you can get a more novel, bigger market device rather than smaller niche products that you've traditionally gone after at a more attractive valuation? Speaker 400:29:11I mean, I would say it doesn't change our strategy so much, Frank. I mean, the types of targets that we're hunting at all starts with the markets they're in and making sure those are markets we're in and their synergy and all that. Of course, when valuations come down, it makes targets more affordable. So and we're likely to have $300 plus million of cash in the bank. So from that standpoint, maybe we can get more with our money. Speaker 400:29:40But in terms of does it change the types of things we're looking at, I would say no, it doesn't really. Speaker 800:29:49Okay. That's helpful. I'll hop back in queue. Thank you. Speaker 200:29:53Thanks, Frank. Operator00:29:54Thank you. One moment for our next question. Our next question is going to come from the line of Jim Sidoti with Sidoti and Co. Your line is open. Please go ahead. Speaker 900:30:04Hi, good afternoon. Thanks for taking the question. So I'm going to ask the operating margin question a different way. For the quarter that just ended, margin was about 21%. You're guiding for 24% for the full year. Speaker 900:30:20What changes in the back half of the year that gets that up? Speaker 200:30:24I mean, one of the big topics here is easier comps excuse me, that's not I apologize. I'm off on a different answer here. What changes I mean, the sales ramp helps you a lot, right? And the gross margin ramp, the implied gross margin ramp, I think the H2 implied gross margin is now 69.9% for the last two quarters. So I think you get a lot in that those second two quarters, the last two quarters of the year that yes, Dorian can add to that. Speaker 100:30:51And the dropping out of the Aleutia distribution agreement, where we only were earning distribution margins, not the full manufacturing margins that we earn on our own biologics, that does have a nice pickup on the gross margin percentage for us in the back half of the year. So that's one of the lifts for us, Jim. Speaker 900:31:13Okay. All right. That makes sense. The other question I had is, in the past, when you said you're going to add 10 sales folks in a year, usually it's maybe one or two at the beginning of the year and it builds up during the year. This year, you seem to add a lot right in the first quarter. Speaker 900:31:30Is that due to the transition from distributors to direct? Are those folks folks that have already been selling your product? Speaker 200:31:40Jim, not really. We put in place a big surge last July, and it really is just that surge kind of coming to fruition. And it's always longer than you think. I would have guessed it would have happened. You remember I was missing my sales rep guidance in Q4. Speaker 200:31:58And I think the bolus of reps came in Q1, not in Q4, and I kind of missed it by three months. So this is just that old surge finally coming to fruition. Speaker 900:32:10All right. And then the last one for me. You have that share buyback program open. Have you started buying shares back? Speaker 200:32:23I don't know how we're supposed to answer that. You know Dorian? We have not bought any shares back as of today. Okay. Speaker 900:32:31All right. Thank you. Operator00:32:33Thank you. And one moment for our next question. Our next question comes from the line of Brett Fishman with KeyBanc Capital Markets. Your line is open. Please go ahead. Speaker 1000:32:45Hey, guys. Good evening. Thanks for taking the questions. Just a couple like more clarification ones. So on the tariffs, very helpful in terms of like laying out some of the key considerations. Speaker 1000:32:57And I'm really just trying to clarify what has been incorporated into the guidance. I know you were talking about like $8.25 ks of extra COGS related to the small China component and then maybe something like more modest around the raw materials and components. I'm just curious, like, if that's like actually factored in specifically into some of the margin assumptions? Speaker 100:33:18So yes, it has been factored in. That 8.25% was an annualized number for China that we gave you. And we if you noted, we're increasing prices in China here in two weeks to recoup about 50% of that where we have the ability to do that on the differentiated products. And that's the real significant impact for us on the back half of the year. We do have the ability to reprice products if we see tariffs, retaliatory tariffs. Speaker 100:33:53The timing of that may not be perfect, but we've incorporated our best estimates into guidance for how we view the rest of the year on this issue. Speaker 1000:34:05All right, helpful. And then second question is just on the Alludia or Alludia, sorry, the pronunciation on the distribution announcement that you're stepping away. And I was just curious like how you're looking at that as an organic growth tailwind. Is it more just like extra time like you're not focusing on that product as much? Yes, just trying to kind of like figure out how exiting $5,000,000 of revenue becomes a tailwind. Speaker 1000:34:30Thank you very much. Speaker 200:34:32Sure. I think this is simple, which is the product is declining year over year in our hands, and the sooner we get it out of our hands, the less it's going to negatively impact our organic growth rate. Speaker 400:34:43Yes, Brett, when we talk about organic and we're not selling in the future because we terminated the relationship or agreed to with Alusha, for the organic math, we pulled the sales a year ago out of the denominator, and that helps us. But you're also bringing up a good point. And I think this was part of the issue with the product and LeMaitre is that it was the third patch inside of the LeMaitre bag. So the LeMaitre reps will be able to focus more on the other products and that could make a contribute to organic growth as well. Speaker 1000:35:20All right. Thank you very much. Speaker 200:35:22Thanks, Thank Operator00:35:24you. One moment for our next question. Our next question comes from the line of Ross Osborne with Cantor Fitzgerald. Your line is open. Please go ahead. Speaker 1100:35:35Hey guys. Congrats on the strong quarter. So almost halfway through the year at this point, so I'll try and squeeze in some questions on 2026, but we'll stay away from numbers at this point. So starting with autograft, congrats on CE Mark. And so following that approval, what steps do you guys need to take from an operational or generating incremental clinical data standpoint this year in order to set yourselves up for a strong 2026 ramp? Speaker 200:36:04And you're specific thanks a lot, Ross. This is George. And you're specifically referring to the autograft project? Speaker 1000:36:11Yes. Speaker 200:36:12Okay, okay, great. Nothing, we don't owe anything to anyone. We're ready to go. This is just a marketing launch. We'll probably do some kind of, just in terms of running clinical looks at it at some point, but we don't have anything planned right now. Speaker 200:36:28We're just going at it. It's a nice launch. The device comes to us or came to us in 2020 with lots and lots of clinical data and lots of articles, so there's no real need to go do more of that. In fact, that's probably why the thing went so quickly in the regulatory pipeline and did not require a clinical trial. Speaker 400:36:47Ross, I would add, it's Dave. Great to hear from you. We actually are shipping, I mean, we're just making our initial shipment from The US to Europe next week, because obviously we couldn't ship until we had the CE mark, and now we've got it. So obviously step one is to place inventory over there. We've already begun training with our US Sales Reps who are expert and facile with autograft. Speaker 400:37:18They've started the training of our European team. But George is right, there's already an enormous amount of clinical data about this product, so there's no generation of clinical data need to launch this product line. Speaker 1100:37:34Okay, perfect. And then turning to RestoreFlow, would you walk through any different market dynamics that may exist between The US versus Germany and Ireland, whether that be price or certain training, such as the return to Ross procedure here as we came to Mount Sinai? And then, how many reps do you think you'll need in those markets, to support adoption? Speaker 100:37:58Okay. I'll go to the the back of Speaker 200:38:00the question. It's a lot simpler, which is I think we have the reps already in place. You don't need to hire additional reps. It's the beauty of this thing. It goes down our sales channel. Speaker 200:38:09So with that out of the way, I would say we have seen a big difference between The U. S. And The U. K. And it's specific sorry, I know you're talking Ireland and Germany, but we're going to learn about that soon. Speaker 200:38:20I feel like they're very different markets. In The UK, it's very much a cardiac approach. Canada is also more cardiac for us, and The US has been more peripheral vascular. So yes, they're going to be different they're all going be different markets. And I think we're going to as we get closer and closer to these launches, we'll be tailoring whether we're to bring more peripheral over there or more cardiac over there. Speaker 200:38:42Inside of this call, we also mentioned there's a nugget in there, which is we're opening up a distribution site in Ireland, in Dublin in the back half of the year. And that should help us once we get approvals in other countries have sort of a pan European approach to that one product, not the other products which are generally shipped out of Frankfurt. Speaker 400:39:04Ross, I'd piggyback on George's comments, and by the way, I'd also say thank you to you and Matt and Cantor for that nice deep dive piece on restorable allografts. You guys did a really thoughtful job with that. At a high level, George is right, we've seen a lot of success in The UK, and part of the reason for that is unlike The US, there aren't companies who are providing allografts and providing them to hospitals. It's a fairly disorganized system in The UK, and we think that's true across Europe more generally. So regardless of the door through which we enter the European market, whether it's Ireland, which opens a lot of countries' doors for us inside the EU, or Germany, which opens fewer but still opens some, the markets that we see ourselves entering are equally fragmented from a supply standpoint. Speaker 400:40:02So we do see a lot of opportunity there. Frankly, I believe, as you and I discussed in Chicago A Month And A Half ago, the biggest challenge for LeMaitre will be providing enough grafts and tissues in Europe to meet the demand. Speaker 1100:40:21Sounds great. Thank you for taking our questions, and congrats again on the progress. Speaker 200:40:26Thanks, Ross. Operator00:40:27Thank you. One moment for our next question. Our next question comes from the line of Danny Stauder with Citizens JMP. Your line is open. Please go ahead. Speaker 1200:40:38Yes, great. Thanks for the questions. Just first one on the sales and marketing spend. It was up a little bit or quite a bit in the first quarter, and I'm assuming that was due to the large step up in the reps. But I was just curious if there were any expenses that were more one time in nature there, such as signing bonuses or anything like that? Speaker 1200:40:57And how should we think about this sales and marketing expense going forward in 2025? Thank you. Speaker 200:41:04Sure. Danny, thanks for the question. This is George. So first of there is a discrete a big guy discrete one, which is there's about $1,000,000 sales meeting almost always that happens in Q1. So it's not a year over year difference for you. Speaker 200:41:17But in terms of looking forward into the year, there's about $1,000,000 of sales meetings that you kick off meetings that you don't need to have for the next three quarters. So there's one thing. And then you alluded to it, but I think it's maybe it's worth going through here. But at the end of Q1 of twenty twenty four, we had 137 reps. And today, as I sit here, we have 164 reps. Speaker 200:41:40It's an increase of 27. So this is a big change, and I think you can feel that in Q1 op expenses, particularly around sales and marketing. So you're right to point that out, but those are the numbers that would support what you're pointing out. Speaker 1200:41:56Great. Thank you for that. And then just one follow-up, looking at free cash flow. In terms of 2025, you talked about this a little bit, but how should we think about CapEx and working capital, specifically inventory as we consider some of these regulatory approvals and geographical expansions? Thank you. Speaker 100:42:17Thanks for the question. I think on CapEx, you consider that to be this quarter to be a fairly standard quarter for us, maybe a little more around some of the offices that are coming online and continue to build outs for the end of the year, but not a big sequential change. Overall, on free cash flow, continue to deliver cash to the bottom line. Speaker 200:42:48Danny, I'd also point out here, we've had this really, I call it lavish policy around here called no back orders at any time. And we're that guy. We always want to have the devices. And it's led us to have a pretty big inventory closet, roughly $65,000,000 worth of inventory in our mostly in Burlington here in Massachusetts, but also around the world in our 13 or 15 offices. We're now finally going after that in terms of we're going to try to be a little bit tighter at titrating back orders and the giant inventory balance. Speaker 200:43:24So you may see some cash free up from that this year, and it could add to some of this free cash flow. Yes. Speaker 100:43:31And in Q1, remember that it's usually a light cash flow quarter for us because you had annual bonuses being paid in Q1. And just maybe the last point on inventory is, in Q1, we were building inventory, particularly in ArteGraft and in RestoreFlow in anticipation of this European launch for ArteGraft and because we do believe that long term supply is one of our constraints on growing the RestoreFlow business. Other than those two product categories, we are seeing the inventory progress there and should be able to free up cash flow subsequent quarters. Speaker 1200:44:11Great. Thank you very much for the questions. Speaker 200:44:15Thanks, Danny. Operator00:44:16Thank you. And one moment for our next question. We have a follow-up question from the line of Michael Podusky Your line is open. Please go ahead. Speaker 500:44:27Hey, thanks so much. Just a couple of quick ones. I may have missed this. George, did you say how many of the, I think, three MDR CE marks that you're looking to get, where you stand on that? Is it 17 at this point, 18? Speaker 500:44:39I missed it Speaker 200:44:40if you said it, I You're good. It is 17 out of 23. Speaker 500:44:4517. Okay, great. And then just one for Dave as well. Dave, in any of the conversations, say, over the last month or so with assets that you're interested in, have you seen anybody where they're essentially saying, hey, we're not doing anything until some of this tariff stuff is resolved? Or we're more anxious to do something because of the screwed up nature of trading relationships. Speaker 500:45:10Like have you heard any feedback either way? I'm just curious. Thanks. Speaker 400:45:15Yes, my short answer is no. I think there's a general sentiment that things are still changing a lot. And so I feel like sellers aren't at one extreme or another saying, we're frozen, we're not doing anything or let's hurry up and dump this asset. I feel like everybody is fairly circumspect about it. And there so far, discussions are generally proceeding, but we've all got an eye on it. Speaker 400:45:44No question. Speaker 500:45:46Okay. All right. Great. Thanks, guys. Operator00:45:50Thank you. Ladies and gentlemen, this concludes today's conference call. I would like to thank you all for your participation. You may now disconnect and have a great day. Speaker 1100:46:02Thanks a lot.Read morePowered by