ARDEN HILLS, Minn., Aug. 09, 2021 (GLOBE NEWSWIRE) —

Intricon Corporation (NASDAQ: IIN)

, an international joint development manufacturer engaged in designing, developing, engineering, manufacturing, and packaging miniature interventional, implantable and body-worn medical devices, today announced financial results for its second quarter ended June 30, 2021.

Second Quarter Highlights:

• Revenue of $30.2 million, a 28% increase compared to the prior year period
• Gross profit margin of 26.1%, compared to 28.0% in the prior year period
• GAAP net loss of $1.2 million versus net loss of $2.3 million in the prior year period
• Non-GAAP adjusted net income of $2.1 million versus $2.1 million in the prior year period
• Cash and investment securities of $32.9 million as of June 30, 2021
• Hired David Liebl as Vice President of R&D on August 9, 2021

“Our second quarter results were driven by outperformance across our business, as we saw a strong resurgence in demand, particularly in our diabetes and hearing health markets. We were pleased to see the initial success and subsequent expansion of the pilot program with HearX, a partnership that places our hardware and firmware in hearing aids sold over-the-counter (OTC) in select Walgreen’s stores,” said Scott Longval, President and Chief Executive Officer.

“Despite a challenging environment, we have made significant progress in the transformation and expansion of our business in the markets we serve, while at the same time, taking steps to build our pipeline and diversify our customer base. We’ve also made great progress in adding to our leadership team, giving me the confidence that we are in the best position to date to leverage our core competencies in high growth markets,” Longval concluded.

Second Quarter 2021 Financial Results



Revenue

Net revenue for the second quarter 2021 increased 28% to $30.2 million versus $23.6 million in the comparable prior-year period. Each key business line, including Diabetes, Hearing Health, Interventional Catheter, and Surgical Navigation posted double digit growth year-over-year.

Diabetes revenue increased 13% to $15.2 million compared to $13.5 million in the prior-year second quarter. The growth was primarily attributable to the continued launch success of the Medtronic MiniMed™ 780G in certain international markets and the MiniMed™ 770G in the U.S.

Interventional Catheter revenue increased 266% to $4.2 million from $1.1 million in the comparable prior-year period. The year-over-year increase was driven primarily by the expansion of Medtronic’s Chocolate Balloon manufactured by Emerald Medical Systems (EMS) and full quarter impact of EMS, which the company acquired in May 2020.

Surgical Navigation revenue was $1.7 million an increase of 54% second quarter year-over-year and 56% sequentially from the first quarter of 2021. This increase was driven by added production capacity as the company worked through specific labor challenges faced earlier in the year.

Hearing Health revenue increased 32% to $7.3 million compared to $5.5 million in the prior-year second quarter. The primary growth driver in this market was the Indirect to End Consumer business related to volumes required to support the OTC pilot program.

Gross Profit Margin and Operating Expenses

Gross profit margin in the second quarter of 2021 was 26.1%, compared to 28.0% in the prior-year second quarter. The lower margin was due to both an increase in direct labor costs and temporary Q2 2020 cost reductions as part of the company’s COVID response.

Operating expenses for the second quarter were $8.8 million, compared to $9.2 million in the prior-year period. The decrease was primarily due to an overall lower cost structure post the 2020 restructuring of Hearing Health Direct to End Consumer operations and timing of certain one-time events impacting both the current and prior periods.

GAAP Net Income

The company posted GAAP net loss of $1.2 million or $0.13 per diluted share in the second quarter of 2021, versus a net loss of $2.3 million or $0.26 per diluted share, for the 2020 second quarter.

Non-GAAP Income

The company posted non-GAAP adjusted net income of $2.1 million or $0.23 per diluted share in the second quarter of 2021, versus net income of $2.1 million or $0.23 per diluted share, for the 2020 second quarter. See “Reconciliation of Adjusted Net Income and Earnings Per Share” in the tables that follow.

Guidance


Intricon now expects 2021 revenue to range between $121 million to $125 million, representing year-over-year growth of 18-22%. This compares to the previous range of $119 million to $123 million, or 16-20% year-over-year growth.

Conference Call


Intricon will hold a conference call today, August 9, 2021, beginning at 4:00 p.m. CT / 5:00 p.m. ET. Investors interested in listening to the conference call may do so by dialing (866) 795-7248 for domestic callers or (470) 495-9160 for international callers, using conference ID: 6328219. A live and archived webcast will be available on the “Investors” sections of the company’s website at: www.Intricon.com.

Use of non-GAAP Adjusted Financial Measures

This press release contains financial measures that have not been calculated in accordance with accounting principles generally accepted in the U.S. (GAAP). These non-GAAP measures include:

• Adjusted net income
• Adjusted net income per diluted share

These non-GAAP financial measures reflect adjustments for expenses and gains that the company believes do not reflect the company’s core operating performance. The company has presented these non-GAAP financial measures because the company believes this presentation, when reconciled to the corresponding GAAP measures, provides useful information to investors in evaluating the company’s operational performance. Management uses these non-GAAP measures internally to evaluate our performance and in making financial, operational and planning decisions, including with respect to incentive compensation. The company believes that the presentation of these measures provides investors with greater transparency with respect to the company’s results of operations and that these measures are useful for period-to-period comparison of results and trends. The company further believes that the use of these non-GAAP financial measures provides an additional tool for investors in comparing the company’s financial results with the financial results of other companies.

The company periodically reassesses the components of non-GAAP adjustments for changes in how the company evaluates Intricon’s performance, changes in how the company makes financial and operational decisions, and considers the use of these measures by Intricon’s competitors and peers to ensure the adjustments are still relevant and meaningful.

Non-GAAP financial measures should not be used as a substitute for GAAP measures, or considered in isolation, for the purpose of analyzing our operating performance. The presentation of these non-GAAP financial measures should not be construed as an inference that future results will not be affected by similar items.

Forward-Looking Statements


Statements made in this release and in Intricon’s other public filings and releases that are not historical facts or that include forward-looking terminology, including estimates of future results, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be affected by known and unknown risks, uncertainties and other factors that are beyond Intricon’s control, including without limitation, the impacts of the COVID-19 pandemic and measures taken in response, and may cause Intricon’s actual results, performance or achievements to differ materially from the results, performance and achievements expressed or implied in the forward-looking statements. These risks, uncertainties and other factors are detailed from time to time in the company’s filings with the Securities and Exchange Commission, including the Annual Report on Form 10-K for the year ended December 31, 2020. The company disclaims any intent or obligation to publicly update or revise any forward-looking statements, regardless of whether new information becomes available, future developments occur or otherwise.

About Intricon Corporation


Intricon is a Joint Development Manufacturer that integrates components and assemblies to advance micro-medical technology across a range of device platforms for global customers. Intricon approaches each engagement with an all-in commitment, working with customers every step of the way- from the earliest idea stages to ongoing production – in order to advance program performance and deliver results. With a focus on key device platforms, Intricon helps advance clinical outcomes by always looking ahead with proactive support and resources through integration of its core competencies. Intricon has facilities in the United States, Asia and Europe. The company’s common stock trades under the symbol “IIN” on the NASDAQ Global Market.

Investor Contact

Leigh Salvo

(415) 937-5404


[email protected]

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CONSOLIDATED STATEMENT OF OPERATIONS

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Reconciliation of Adjusted Net Income and Earnings Per Share

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