Orthofix Reports Fourth Quarter and Full-Year 2024 Results and Provides 2025 Financial Guidance

Record Results Reflect Strong Execution as Company Focuses on Most Profitable Growth Opportunities in Spine, Orthopedics and Bone Growth Therapies

LEWISVILLE, Texas--(BUSINESS WIRE)--February 25, 2025-- 

Orthofix Medical Inc. $(OFIX)$, a leading global medical technology company, today reported its financial results for the fourth quarter and full-year ended December 31, 2024, and provided full-year 2025 financial guidance.

Highlights

   -- 
 Record fourth quarter 2024 net sales of $215.7 million, an increase of 
      8% on a reported and constant currency basis compared to fourth quarter 
      2023 
 
 
   -- 
 U.S. Spine Fixation1 net sales growth of 12% compared to fourth quarter 
      2023, driven by distribution expansion and further penetration in 
      existing accounts 
 
 
   -- 
 Record Bone Growth Therapies ("BGT") net sales of $63.9 million, 
      representing growth of 9% and BGT Fracture net sales growth of 10% 
      compared to fourth quarter 2023 
 
 
   -- 
 Record Global Orthopedics net sales of $35.8 million, representing 
      constant currency growth of 18% and U.S. Orthopedics net sales growth of 
      21% compared to fourth quarter 2023 
 
 
   -- 
 Company entered into record number of 7D FLASH$(TM)$ Navigation System 
      placements for the full-year 2024 
 
 
   -- 
 Fourth quarter 2024 net loss of $(29.1) million; Non-GAAP adjusted 
      EBITDA of $23.9 million, an increase of $4.3 million, with adjusted 
      EBITDA margin expanding approximately 130 basis points compared to fourth 
      quarter 2023 
 
 
   -- 
 Free cash flow of $15.2 million in fourth quarter 2024, a significant 
      improvement in cash usage compared to previous quarters 
 
 
   -- 
 Company increases long-term net sales compound annual growth rate 
      ("CAGR") target to 6.5% to 7.5% from previous net sales CAGR target of 6% 
      to 7% 
 

Fourth quarter 2024 net sales were $215.7 million, an increase of 8% on a reported and constant currency basis. Net loss was $(29.1) million and earnings per share ("EPS") was $(0.75) on a reported basis, representing a decline of 27% when compared to the same prior year period. Non-GAAP adjusted EBITDA was $23.9 million for the fourth quarter, representing 22% growth compared to the fourth quarter of 2023.

Full-year 2024 net sales were $799.5 million, an increase of 7% on a reported and constant currency basis. Net loss was $(126.0) million and EPS was $(3.30), representing an improvement of 20% when compared to the same prior year period. Non-GAAP adjusted EBITDA was $67.4 million for the full-year, representing 46% growth compared to the full year of 2023.

"We are pleased with the performance of the Orthofix team to serve our surgeons and patients and successfully execute our plans throughout 2024," said Massimo Calafiore, President and CEO. "Our fourth quarter results reflect outstanding performance across all three major product lines, providing further evidence that Orthofix's balanced and complementary product mix offers a differentiated advantage across multiple markets. We enter 2025 with great momentum as two integrated organizations. The entire team remains focused on executing our priorities, and I look forward to leveraging our unique portfolio platform to drive value creation through profitable growth in 2025 and beyond."

Financial Results Overview

Fourth Quarter 2024 Net Sales and Financial Results

The following table provides net sales by major product category by reporting segment:

 
                      Three Months Ended December 31, 
-----------------   ------------------------------------ 
(Unaudited, U.S.                                Constant 
Dollars, in                                     Currency 
millions)            2024    2023   Change       Change 
-----------------   ------  ------  ------      -------- 
    Bone Growth 
     Therapies      $ 63.9  $ 58.8     8.6%          8.6% 
    Spinal 
     Implants, 
     Biologics, 
     and Enabling 
     Technologies    116.0   111.0     4.5%          4.5% 
------------------   -----   -----  ------      -------- 
Global Spine         179.9   169.8     5.9%          6.0% 
Global Orthopedics    35.8    30.6    16.8%         18.1% 
------------------   -----   -----  ------      -------- 
Net sales           $215.7  $200.4     7.6%          7.8% 
------------------   -----   -----  ------      -------- 
 

Gross margins were 69.0% for the quarter and were 71.1% on a non-GAAP adjusted basis.

Net loss was $(29.1) million, or $(0.75) per share, compared to net loss of $(22.2) million, or $(0.59) per share in the prior year period. Non-GAAP adjusted EBITDA was $23.9 million, or 11.1% of net sales, compared to non-GAAP adjusted EBITDA of $19.6 million, or 9.8% of net sales, in the prior year period.

Full-Year 2024 Net Sales and Financial Results

The following table provides net sales by major product category by reporting segment:

 
                         Year Ended December 31, 
----------------   ------------------------------------ 
(Unaudited, U.S.                               Constant 
Dollars, in                                    Currency 
millions)           2024    2023   Change       Change 
----------------   ------  ------  ------      -------- 
   Bone Growth 
    Therapies      $233.4  $212.5     9.8%          9.8% 
   Spinal 
    Implants, 
    Biologics, 
    and Enabling 
    Technologies    441.9   418.8     5.5%          5.5% 
-----------------   -----   -----  ------      -------- 
Global Spine        675.3   631.3     7.0%          7.0% 
Global 
 Orthopedics        124.2   115.3     7.7%          7.9% 
-----------------   -----   -----  ------      -------- 
Net sales          $799.5  $746.6     7.1%          7.1% 
-----------------   -----   -----  ------      -------- 
 

Gross margins were 68.3% for the year and were 71.0% on a non-GAAP adjusted basis.

Net loss was $(126.0) million, or $(3.30) per share, compared to net loss of $(151.4) million, or $(4.12) per share in the prior year period. Non-GAAP adjusted EBITDA was $67.4 million, or 8.4% of net sales, compared to non-GAAP adjusted EBITDA of $46.3 million, or 6.2% of net sales, in the prior year period.

Liquidity

Cash, cash equivalents, and restricted cash on December 31, 2024 totaled $85.7 million compared to $37.8 million on December 31, 2023.

M6 Artificial Disc Update

Consistent with Orthofix's strategic focus on spinal fixation and deformity correction, the Company has decided to discontinue its M6-C(TM) artificial cervical disc and M6-L(TM) artificial lumbar disc product lines and allocate associated resources and investment to more profitable growth opportunities in those focus areas. Global net sales for the M6-C artificial cervical and M6-L artificial lumbar discs were $23.4 million in 2024. Orthofix intends to fulfill all requirements related to post-market surveillance activities and meet its obligations with respect to premarket approval of M6 devices, including completion of the IDE study in the United States.

Business Outlook

The Company is providing full-year 2025 guidance as follows:

   -- 
 Net sales expected to range between $818 million to $826 million, 
      excluding sales from the discontinued M6 artificial disc product lines 
      and including a negative impact from foreign currency of approximately $4 
      million, or 50 basis points, on a reported basis, as compared to the 
      full-year 2024. The Company's expected net sales represent implied 
      constant currency growth of 6.5% year-over-year at the midpoint of the 
      range. This guidance range is based on the current foreign currency 
      exchange rates and does not take into account any additional potential 
      exchange rate changes that may occur this year. 
 
 
   -- 
 Non-GAAP adjusted EBITDA expected to be $82 million to $86 million. 
      This range includes the anticipated impact from the discontinuation of 
      the M6 product lines. 
 
 
   -- 
 Positive free cash flow expected for full-year 2025, excluding the 
      impact of restructuring charges related to the discontinuation of the 
      M6-C artificial cervical and M6-L artificial lumbar disc product lines. 
 
 
   -- 
 The Company is also increasing its long-term net sales CAGR target to 
      6.5% to 7.5% from the previous net sales CAGR target of 6% to 7%, 
      reflecting the discontinuation of the M6 artificial disc product lines. 
 

The Company will provide a full update on the accounting treatment and financial impact for the discontinuation of the M6 product lines on its first quarter 2025 earnings call.

An investor presentation for the Company's fourth quarter and full-year 2024 financial results is available in the "Events & Presentations" section of the Orthofix investor relations website at ir.orthofix.com.

Conference Call

Orthofix will host a conference call today at 8:30 AM Eastern time to discuss the Company's financial results for the quarter ended December 31, 2024. Interested parties may access the conference call by dialing (888) 596-4144 in the U.S., and (646) 968-2525 in all other locations, and referencing the access code 5184023. A webcast and replay of the conference call may be accessed in the "Events & Presentations" section of the Orthofix investor relations website at ir.orthofix.com.

Internet Posting of Information

Orthofix routinely posts information that may be important to investors in the "Investor Relations" section of its website at www.orthofix.com. The Company encourages investors and potential investors to consult the Orthofix website regularly for important information about Orthofix.

About Orthofix

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