Covalon Announces Fiscal 2019 Year-End Results and Plans for Fiscal 2020
Fiscal 2019 revenue growth of 27% to
$34 millionof revenue.
Fiscal 2019 United States revenue of
$24 million, double the Company’s fiscal 2018 United States revenue.
Fiscal 2019 Middle East revenue of
$8.8 millionimpacted by delayed shipments and regional uncertainty.
Latin Americaand Europeto provide some additional revenue upside in fiscal 2020 and beyond.
Completing the acquisition of U.S.-based AquaGuard, which provides
Covalonwith almost 2,000 new hospital and medical institutions as customers in the United Statesand a talented and experienced sales force selling infection prevention products directly into hospitals;
- Strong growth in our development and consulting services revenue following the signing of the previously announced major contract with one of the world’s largest medical device companies that licensed Covalon’s proprietary medical coating technologies; and
Completion of product registration for Covalon’s flagship products in most Latin American countries, including
Mexico, Argentinaand Chile, enabling Covalonto compete for business in these markets in fiscal 2020 and beyond.”
Mr. Pedlar continued, “Over the past two years,
- We added 35 people to our sales and marketing teams, which means more people selling our products;
We now have nearly 2,000 new hospital, clinic, group purchasing organizations, and integrated delivery network customers in
the United Statesthat provide a new customer base for our existing products;
- We have begun to distribute our products in 16 new countries that will begin to materially contribute to revenue;
- We now have four product families that each account for 20% or more of our annual revenue, which provides stability and diversification for our business;
- We have four new products that we have yet to launch in our key markets;
- We have exciting new products in our pipeline that we intend to launch this year, including a significantly improved version of our flagship IV Clear product; and
- We engaged in over 60 customer development projects of various sizes with approximately 22 medical product companies this past year in our OEM business, which includes the various projects underway associated with the previously announced major contract with one of the world’s largest medical device companies that licensed Covalon’s proprietary medical coating technologies.
“We are just at the beginning of our growth as a result of these key changes to
“I am extremely confident in Covalon’s present commercialization position and its upside potential. Our unique suite of life-saving products and our dedicated and driven staff have always set us apart from the competition, and we continue to leverage those strengths as we grow our business. Our share price declined this past year due to uncertainty in our
Fiscal 2019 Financial Results
Revenue for the year ended
Product revenue for fiscal 2019 increased to
Gross margin was 64% for fiscal 2019, compared to 74% for the prior year. Gross margin is highly influenced by the mix of collagen-based dressings, silicone-based dressings, medical coated devices, passive dressings, moisture barriers, and related service revenues generated in the periods. Gross margin fluctuates as a result of the mix of products sold in any given quarter, or year, by product type or geography.
Operating expenses increased
Fiscal 2019 saw the Company end the year with a strengthened and more diversified revenue base. In fiscal 2019, approximately 71% of revenue was from sales in
Conference Call Scheduled
A conference call to discuss Covalon’s Fiscal 2019 Year-End Financial Results will be held
Conference ID Code: 5092807
A recording of the call will be available by calling 855.859.2056 or 404.537.3406 and entering the conference ID code 5092807 from
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains forward-looking statements which reflect the Company's current expectations regarding future events. The forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", "plan, "estimate", "expect", "intend" and statements that an event or result "may", "will", "should", "could" or "might" occur or be achieved and other similar expressions. These forward-looking statements involve risk and uncertainties, including completion of integration of the AquaGuard acquisition, the difficulty in predicting product approvals, acceptance of and demands for new products, the impact of the products and pricing strategies of competitors, delays in developing and launching new products, the regulatory environment, fluctuations in operating results and other risks, any of which could cause results, performance, or achievements to differ materially from the results discussed or implied in the forward-looking statements. Many risks are inherent in the industry; others are more specific to the Company. Investors should consult the Company's ongoing quarterly filings for additional information on risks and uncertainties relating to these forward-looking statements. Investors should not place undue reliance on any forward-looking statements. The Company assumes no obligation to update or alter any forward-looking statements whether as a result of new information, further events or otherwise.