Align Technology, Inc. (Nasdaq: ALGN) today reported financial
results for the fourth quarter (Q4’19) and year ended December 31,
2019 (2019). Q4’19 total revenues were $649.8 million, up 21.7%
year-over-year. Q4’19 clear aligner revenues were $543.6 million,
up 22.0% year-over-year and Q4’19 scanner and services revenues
were $106.2 million, up 20.2% year-over-year. Q4’19 Invisalign
volume was 413.7 thousand cases, up 23.9% year-over-year. For the
Americas and International regions, Q4’19 Invisalign volume was up
19.3% and 30.1% year-over-year, respectively. Q4’19 Invisalign
volume for teenage patients was 116 thousand cases, up 33.1%
year-over-year. Q4’19 operating income of $151.2 million was up
25.5% year-over-year resulting in an operating margin of 23.3%.
Q4’19 net income was $121.3 million, or $1.53 per diluted share.
For 2019, total revenues were a record $2.4
billion, up 22.4% year-over-year. Record 2019 clear aligner
revenues were $2.0 billion, up 19.8% year-over-year and Invisalign
case shipments were 1.5 million, up 24.2% year-over-year. Record
2019 iTero scanner and services revenue were $381.0 million, up
38.5% year-over-year with record volume, up 29.7% year-over-year.
2019 Invisalign cases for teenage patients were 446.7 thousand, up
34.1% year-over-year. 2019 net profit was $442.8 million, or
$5.53 per diluted share.
Commenting on Align’s Q4’19 and 2019 results,
Align Technology President and CEO Joe Hogan said, “Our fourth
quarter was a strong finish to a great year with record revenues
and volumes. Q4’19 Invisalign shipments increased 23.9%
year-over-year and marked another major milestone with our 8
millionth Invisalign patient who started treatment in December.
Q4’19 iTero scanner and services revenues increased 20.2%
year-over-year with strong growth especially from international
doctors. For the full year, revenues of $2.4 billion reflect record
revenues and volumes for both Invisalign clear aligners and iTero
scanners. During the year, over 1.5 million people started
treatment with Invisalign clear aligners, including 447 thousand
teens and younger patients which increased 34.1%.”
GAAP Summary Financial
ComparisonsFourth Quarter Fiscal 2019
|
Q4’19 |
Q3’19 |
Q4’18 |
Q/Q Change |
Y/Y Change |
Invisalign Case Shipments 1 |
|
413,725 |
|
385,360 |
|
333,800 |
|
7.4% |
|
23.9% |
Net Revenues |
$649.8M |
$607.3M |
$534.0M |
|
7.0% |
|
21.7% |
Clear Aligner 2 |
$543.6M |
$516.3M |
$445.6M |
|
5.3% |
|
22.0% |
Scanner & Services |
$106.2M |
$91.1M |
$88.4M |
|
16.6% |
|
20.2% |
Net Profit |
$121.3M |
$102.5M |
$97.4M |
|
18.3% |
|
24.5% |
Diluted EPS |
|
$1.53 |
|
$1.28 |
|
$1.20 |
|
+$0.25 |
|
+$0.33 |
Fiscal 2019
|
|
|
|
2019 |
|
2018 |
Y/Y Change |
Invisalign Case Shipments 1 |
|
|
|
1,525,415 |
|
1,228,065 |
|
24.2% |
Net Revenues |
|
|
$2,406.8M |
$1,966.5M |
|
22.4% |
Clear Aligner 2 |
|
|
$2,025.8M |
$1,691.5M |
|
19.8% |
Scanner & Services |
|
|
$381.0M |
$275.0M |
|
38.5% |
Net Profit 3 |
|
|
$442.8M |
$400.2M |
|
10.6% |
Diluted EPS3 |
|
|
|
$5.53 |
|
$4.92 |
|
+$0.61 |
Note: Changes and percentages are based on
actual values and may affect totals due to rounding1 Invisalign
shipments do not include SmileDirectClub (“SDC“) aligners.2 Clear
aligner revenues include Invisalign clear aligners and SDC
aligners. The supply agreement with SDC terminated December
31, 2019 and was not renewed. In 2019, the overwhelming
majority of aligners declared by SDC were not manufactured by
Align.3 2019 results before tax include a $51.0 million gain from
the settlement of the Straumann litigation ($45.7M net of tax or
approximately $0.57 EPS benefit), impairments of $23.0 million
($17.2M net of tax or approximately $0.21 EPS impact) related to
closing Invisalign Stores as a result of the arbitrator’s decision
regarding SDC announced March 5, 2019, and other gains of $15.8M
($10.7M net of tax or approximately $0.13 EPS benefit) from the
sale of our investment in SDC.
As of December 31, 2019, Align had $868.6
million in cash, cash equivalents and marketable securities
compared to $744.5 million as of December 31, 2018. In Q4’19, we
repurchased approximately 389K shares of our common stock
at an average price of $258.67 per share and have $100.0
million remaining available for repurchase under the May 2018
Repurchase Program.
Align 2019 Highlights:
Corporate
- Announced co-marketing
relationships with the San Francisco 49ers, Carolina Hurricanes,
Super Bowl winning New England Patriots, and the 2019 NBA Champions
the Toronto Raptors, making the Invisalign brand the official smile
partner for each of these winning teams.
- Announced that it is a national
sponsor for the premier healthy lifestyle brand Life Time as part
of Align’s $120 million annual commitment to raise consumer
awareness of doctor directed Invisalign clear aligner treatment for
better smiles.
- Align awarded ten research grants
totaling $250,000 as part of its ongoing annual research awards
program to universities worldwide.
- Entered into a
distribution agreement with Benco Dental, the largest
privately-owned dental distributor in the U.S., for Align’s family
of iTero Element intraoral scanners.
- Entered into an agreement with
Digital Smile Design (DSD), a leader in holistic, digital and
emotional dentistry solutions, to incorporate DSD into Align’s
end-to-end digital workflow, including iTero scanning
technology.
- Opened Align University Training
Institute in Shanghai, China, Align’s second training facility in
China.
Product
- Announced a global distribution
agreement for the award-winning iTero Element family of intraoral
scanners with Zimmer Biomet Dental, a global dental industry leader
and provider of implant and restorative solutions and continuing
education for dental professionals.
- Announced commercial availability
of the iTero Element 2 scanner in China at the
2019 International Orthodontic Conference and the
18th Annual Meeting of the Chinese Orthodontic
Society in Nanjing, China.
- Launched the new iTero Element
Foundation intraoral scanner with restorative software, extending
Align’s portfolio of intraoral scanners with powerful 3D
visualization to better meet the needs of doctors, labs and
patients.
- Launched the new iTero Element 5D
Imaging System for comprehensive, preventative and restorative oral
care. The iTero Element 5D Imaging System provides a new
comprehensive approach to clinical applications, workflows and user
experience that expands the suite of existing high-precision,
full-color imaging and fast scan times of the iTero Element
portfolio.
- Launched SmileView, an online tool
designed to help prospective Invisalign patients visualize a new,
straighter smile before they opt for Invisalign treatment.
Q1 2020 (Q1’20) Business
OutlookAs a result of the corporate structure
reorganization to relocate our European headquarters from the
Netherlands to Switzerland in Q1’20, our Q1’20 GAAP tax rate will
reflect a significant one-time tax benefit associated with the
recognition of a deferred tax asset related to the intra-entity
sale of certain intellectual property rights. This deferred tax
benefit will be amortized starting in 2020 and continue into
subsequent quarters and years. The period over which this tax
benefit will be recognized depends on the profitability of our
Swiss headquarters and therefore is uncertain at this time.
Management ordinarily assesses the health of our business without
regard to these types of one-time events and believes this
reorganization will make it difficult for investors to assess our
core underlying financial performance were we to report solely
based on GAAP. Therefore, we will supplement our GAAP information
with non-GAAP measures going forward. Beginning in Q1’20, in
addition to our GAAP results we will present non-GAAP measures that
exclude the aforementioned tax impact, along with certain other
items that may not be indicative of our fundamental operating
performance including discrete cash and non-cash charges in order
to present investors with greater transparency into our core
business operations. A reconciliation of GAAP
to non-GAAP outlook is provided at the end of this
release.
The following statements are forward-looking
statements based on current expectations and assumptions, and
involve risk and uncertainties, some of which are set forth below
under “Forward-Looking Statements.”
Novel Coronavirus in ChinaAs
reported by news agencies worldwide, the recent outbreak of the
novel coronavirus in Wuhan, the capital of the Hubei Province in
China, is a serious situation. China is one of our largest
country markets and represents roughly 8% of our total revenues.
The situation in China is very fluid and we are closely monitoring
it. We are in contact with various relevant agencies globally. Thus
far, the Chinese government has implemented travel bans and has
essentially shutdown public transportation in Wuhan. It has
also issued public warnings to avoid all non-essential medical and
dental procedures for the time-being.
While we do not believe there are any concerns
regarding the safety of our products due to the stringent health
and safety procedures of our manufacturing processes, we are taking
additional precautions across China to minimize the risk of
spreading illness to our internal teams, including additional
protections and health screening procedures as well as travel
bans/restrictions.
Given this increased uncertainty and disruption
to our employees, customers/doctors’ practices, their patients and
consumers, we believe it is prudent to reduce our outlook for
Q1’20. Therefore, for Q1’20, our outlook reflects approximately
20,000 to 25,000 fewer Invisalign case shipments and approximately
$30.0 million to $35.0 million less revenues for Invisalign and
iTero products sold in China. In addition, we are also absorbing
$3.0 million to $4.0 million in idle China plant capacity costs
which we expect will result in approximately a 0.5% gross margin
impact.
Commenting on Align’s first quarter outlook,
Hogan continued, “As we kick off 2020, we are very concerned for
the safety and health of our employees, customers/doctors and their
patients in China. Their wellbeing is our top priority and we
are doing everything we can to ensure that they are in
good hands. We are working with our local team to donate
medical supplies and provide funding to help combat the outbreak.
While we are mindful of the increased uncertainty in China and its
impact on our first quarter outlook, it’s important to take a step
back and remember that our business is broad and deep. We have
strong growth in other regions, and are seeing strong momentum in
the Americas, across EMEA and in all other countries in APAC
especially Japan, Australia/New Zealand, Southeast Asia, Taiwan and
Korea.”
For Q1’20, Align provides the following
guidance:
- Net revenues in the range of $615.0
million to $630.0 million, up approximately 12% to 15% over the
same period a year ago, which reflects $30.0 million to $35.0
million less revenues for Invisalign and iTero products sold in
China.
- Invisalign case shipments in the
range of 396 thousand to 406 thousand, up approximately 13% to 16%
over the same period a year ago, which reflects approximately
20,000 to 25,000 fewer Invisalign case shipments from China.
- GAAP operating margin in the range
of 15.4% to 16.5%. • Non-GAAP operating margin in the range
of 19.5% to 20.5%.
- GAAP effective tax rate in the
range of (1,440%) to (1,302%) • Non-GAAP effective tax
rate in the range of 22% to 23%.
- GAAP diluted EPS in the range of
$18.65 to $18.74. • Non-GAAP diluted EPS in the range of
$1.19 to $1.28.
Align Web Cast and Conference
CallAlign will host a conference call today, January 29,
2020 at 4:30 p.m. ET, 1:30 p.m. PT, to review its fourth quarter
and fiscal 2019 results, discuss future operating trends and the
business outlook. The conference call will also be web cast live
via the Internet. To access the webcast, go to the “Events
& Presentations” section under Company Information on Align’s
Investor Relations web site at http://investor.aligntech.com.
To access the conference call, please dial 201-689-8261. An
archived audio web cast will be available beginning approximately
one hour after the call's conclusion and will remain available for
approximately one month. Additionally, a telephonic replay of the
call can be accessed by dialing 877-660-6853 with conference number
13697560 followed by #. For international callers, please dial
201-612-7415 and use the same conference number referenced above.
The telephonic replay will be available through 5:30 p.m. ET on
February 12, 2020.
About Non-GAAP Financial
MeasuresTo supplement our condensed consolidated financial
statements, which are prepared and presented in accordance with
generally accepted accounting principles in the United States
(“GAAP”), we intend to provide investors with certain non-GAAP
financial measures beginning in Q1’20 including, non-GAAP gross
profit, gross margin, operating expenses, income from operations,
operating margin, effective tax rate, net income and diluted EPS,
which exclude certain items that may not be indicative of our
fundamental operating performance including discrete cash and
non-cash charges or gains that are included in the most directly
comparable GAAP measure. Non-GAAP measures will exclude the effects
of stock-based compensation, non-cash deferred tax assets and
associated amortization related to intra-entity transfer of
non-inventory assets, impairments and other (gains) charges, and
litigation settlement gains, and, if applicable, any associated tax
impacts.
We use non-GAAP financial measures for financial
and operational decision-making and as a means to evaluate
period-to-period comparisons. Our management believes that these
non-GAAP financial measures provide meaningful supplemental
information regarding our recurring core operating performance. We
believe that both management and investors benefit from referring
to these non-GAAP financial measures in assessing our performance
and when planning, forecasting and analyzing future periods. These
non-GAAP financial measures also facilitate management's internal
evaluation of period-to-period comparisons. We believe these
non-GAAP financial measures are useful to investors both because
(1) they allow for greater transparency with respect to key metrics
used by management in its financial and operational decision-making
and (2) they will be provided to and used by our institutional
investors and the analyst community to help them analyze the
performance of our business.
There are limitations to using non-GAAP
financial measures, though, because they are not prepared in
accordance with GAAP and may be different from non-GAAP financial
measures used by other companies. The non-GAAP financial measures
are limited in value because they exclude certain items that may
have a material impact upon our reported financial results. In
addition, they are subject to inherent limitations as they reflect
the exercise of judgments by management about which charges are
excluded from the non-GAAP financial measures. We compensate for
these limitations by analyzing current and future results on a GAAP
as well as a non-GAAP basis and also by providing GAAP measures in
our public disclosures. The presentation of non-GAAP financial
information is meant to be considered in addition to, not as a
substitute for or in isolation from, the directly comparable
financial measures prepared in accordance with GAAP. We urge
investors to review the reconciliation of our GAAP financial
measures to the comparable Non-GAAP financial measures included in
this presentation, and not to rely on any single financial measure
to evaluate our business. For more information on these non-GAAP
financial measures, please see the tables captioned "Q1’20
Reconciliation of GAAP to Non-GAAP" and "Business Outlook Summary"
included at the end of this release.
About Align Technology,
Inc.Align Technology designs and manufactures the
Invisalign® system, the most advanced clear aligner system in the
world, and iTero® intraoral scanners and services. Align’s products
help dental professionals achieve the clinical results they expect
and deliver effective, cutting-edge dental options to their
patients. Visit www.aligntech.com for more information.
For additional information about the Invisalign
system or to find an Invisalign doctor in your area, please visit
www.invisalign.com. For additional information about iTero digital
scanning system, please visit www.itero.com.
Forward-Looking StatementsThis
news release, including the tables below, contains forward-looking
statements, including quotations from management, statements in the
paragraphs under Q1 2020 (Q1’20) Business Outlook and Novel
Coronavirus in China regarding certain business metrics on either
or both a GAAP or non-GAAP basis for the first quarter of 2020,
including, but not limited to, anticipated net revenues, operating
margin, tax rates, benefits and amortization, case shipments, and
expected declines in Invisalign case shipments, Invisalign and
iTero revenues, idle operations and gross margins from the effects
of the novel coronavirus in China as well as the strength of our
business, its growth and momentum in regions outside China.
Forward-looking statements contained in this news release and the
tables below relating to expectations about future events or
results are based upon information available to Align as of the
date hereof. Readers are cautioned that these forward-looking
statements are only predictions and are subject to risks,
uncertainties and assumptions that are difficult to predict. As a
result, actual results may differ materially and adversely from
those expressed in any forward-looking statement.
Factors that might cause such a difference
include, but are not limited to, difficulties predicting customer
and consumer purchasing behavior, adverse impacts to our operations
in China stemming from measures we may take to ensure the health
and safety of our employees, consumers, contractors, suppliers and
their families from viral outbreaks in China on top of governmental
efforts to minimize the spread of illness, a tougher consumer
demand environment in China generally, especially for manufacturers
and service providers whose headquarters or primarily operations
are not based in China, expectations regarding the continued growth
of our international markets, increasing competition from existing
and new competitors, rapidly evolving and groundbreaking advances
that are fundamentally changing the dental industry and the way new
and existing participants market and provide products and services
to consumers, the ability to protect our intellectual property
rights, continued compliance with regulatory requirements, our
expectations regarding sales growth of our intra-oral scanner sales
in international markets, our belief that technology features and
functionality of the iTero scanners will increase adoption of
Invisalign and increase sales of our intra-oral scanners, our
expectations regarding the financial and strategic benefits of
establishing regional order acquisition, treatment planning and
manufacturing facilities, the willingness and ability of our
customers to maintain and/or increase product utilization in
sufficient numbers, the possibility that the development and
release of new products or enhancements to existing products do not
proceed in accordance with the anticipated timeline or may
themselves contain bugs or errors requiring remediation, the
possibility that the market for the sale of these new or enhanced
products may not develop as expected, or that the expected benefits
of new or existing business relationships will not be achieved as
anticipated, our expectations concerning additional costs related
to the corporate structure reorganization, including the relocation
of our European headquarters from the Netherlands to Switzerland,
the risks relating to our ability to sustain or increase
profitability or revenue growth in future periods while controlling
expenses, the expected impact additional sales representatives will
have on our sales, growth related risks, including excess or
constrained capacity at our manufacturing and treat operations
facilities and pressure on our internal systems and personnel, the
compromise of customer and/or patient data for any reason, and
system integration and implementation issues, continued customer
demand for our existing and new products, changes in consumer
spending habits as a result of, among other things, prevailing
economic conditions, levels of employment, salaries and wages and
consumer confidence, the timing of case submissions from our
doctors within a quarter as well as an increased manufacturing
costs per case, acceptance of our products by consumers and dental
professionals, foreign operational, political and other risks
relating to our international manufacturing operations, our ability
to develop and successfully introduce new products and product
enhancements and the loss of key personnel.
The foregoing and other risks are detailed from
time to time in our periodic reports filed with the Securities and
Exchange Commission, including, but not limited to, our Annual
Report on Form 10-K for the year ended December 31, 2018, which was
filed with the Securities and Exchange Commission (SEC) on February
28, 2019 and our latest Quarterly Report on Form 10-Q for the
quarter ended September 30, 2019, which was filed with the SEC on
October 31, 2019. We undertake no obligation to revise or update
publicly any forward-looking statements for any reason.
Align
Technology |
Zeno
Group |
Madelyn Homick |
Sarah Johnson |
(408) 470-1180 |
(828) 551-4201 |
mhomick@aligntech.com |
sarah.johnson@zenogroup.com |
ALIGN TECHNOLOGY,
INC. |
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS |
|
(in thousands, except
per share data) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months EndedDecember 31, |
|
Year EndedDecember 31, |
|
|
|
|
2019 |
|
|
2018 |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenues |
|
$ |
649,787 |
|
$ |
534,020 |
|
|
$ |
2,406,796 |
|
|
$ |
1,966,492 |
|
|
|
|
|
|
|
|
|
|
|
|
Cost of net
revenues |
|
|
177,829 |
|
|
150,924 |
|
|
|
662,899 |
|
|
|
518,625 |
|
|
|
|
|
|
|
|
|
|
|
|
Gross
profit |
|
|
471,958 |
|
|
383,096 |
|
|
|
1,743,897 |
|
|
|
1,447,867 |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
|
279,481 |
|
|
226,819 |
|
|
|
1,072,053 |
|
|
|
852,404 |
|
|
Research and development |
|
|
41,327 |
|
|
35,804 |
|
|
|
157,361 |
|
|
|
128,899 |
|
|
Impairments and other (gains) charges |
|
|
- |
|
|
- |
|
|
|
22,990 |
|
|
|
- |
|
|
Litigation settlement gain |
|
|
- |
|
|
- |
|
|
|
(51,000 |
) |
|
|
- |
|
|
Total operating expenses |
|
|
320,808 |
|
|
262,623 |
|
|
|
1,201,404 |
|
|
|
981,303 |
|
|
|
|
|
|
|
|
|
|
|
|
Income from
operations |
|
|
151,150 |
|
|
120,473 |
|
|
|
542,493 |
|
|
|
466,564 |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
income |
|
|
2,906 |
|
|
2,249 |
|
|
|
12,482 |
|
|
|
8,576 |
|
|
Other income
(expense), net |
|
|
1,741 |
|
|
(730 |
) |
|
|
7,676 |
|
|
|
(8,489 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net income
before provision for income taxes and equity in losses of
investee |
|
|
155,797 |
|
|
121,992 |
|
|
|
562,651 |
|
|
|
466,651 |
|
|
|
|
|
|
|
|
|
|
|
|
Provision
for income taxes |
|
|
34,535 |
|
|
22,517 |
|
|
|
112,347 |
|
|
|
57,723 |
|
|
Equity in
losses of investee, net of tax |
|
|
- |
|
|
2,083 |
|
|
|
7,528 |
|
|
|
8,693 |
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
|
$ |
121,262 |
|
$ |
97,392 |
|
|
$ |
442,776 |
|
|
$ |
400,235 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income
per share: |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
1.54 |
|
$ |
1.22 |
|
|
$ |
5.57 |
|
|
$ |
5.00 |
|
|
Diluted |
|
$ |
1.53 |
|
$ |
1.20 |
|
|
$ |
5.53 |
|
|
$ |
4.92 |
|
|
|
|
|
|
|
|
|
|
|
|
Shares used
in computing net income per share: |
|
|
|
|
|
|
|
|
|
Basic |
|
|
78,578 |
|
|
79,891 |
|
|
|
79,424 |
|
|
|
80,064 |
|
|
Diluted |
|
|
79,137 |
|
|
80,943 |
|
|
|
80,100 |
|
|
|
81,357 |
|
|
|
|
|
|
|
|
|
|
|
|
ALIGN TECHNOLOGY, INC. |
|
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
|
|
|
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,2019 |
|
December 31,2018 |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Current
assets: |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
550,425 |
|
$ |
636,899 |
|
Marketable securities, short-term |
|
|
318,202 |
|
|
98,460 |
|
Accounts receivable, net |
|
|
550,291 |
|
|
439,009 |
|
Inventories |
|
|
112,051 |
|
|
55,641 |
|
Prepaid expenses and other current assets |
|
|
102,450 |
|
|
72,470 |
|
Total current assets |
|
|
1,633,419 |
|
|
1,302,479 |
|
|
|
|
|
|
|
Marketable
securities, long-term |
|
|
- |
|
|
9,112 |
|
Property,
plant and equipment, net |
|
|
631,730 |
|
|
521,329 |
|
Operating
lease right-of-use assets, net |
|
|
56,244 |
|
|
- |
|
Equity
method investments |
|
|
- |
|
|
45,913 |
|
Goodwill and
intangible assets, net |
|
|
75,692 |
|
|
81,949 |
|
Deferred tax
assets |
|
|
64,007 |
|
|
64,689 |
|
Other
assets |
|
|
39,610 |
|
|
26,987 |
|
|
|
|
|
|
|
Total assets |
|
$ |
2,500,702 |
|
$ |
2,052,458 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable |
|
$ |
87,250 |
|
$ |
64,256 |
|
Accrued liabilities |
|
|
319,958 |
|
|
234,679 |
|
Deferred revenues |
|
|
563,762 |
|
|
393,138 |
|
Total current liabilities |
|
|
970,970 |
|
|
692,073 |
|
|
|
|
|
|
|
Income tax
payable |
|
|
102,794 |
|
|
78,008 |
|
Operating
lease liabilities |
|
|
43,463 |
|
|
- |
|
Other
long-term liabilities |
|
|
37,306 |
|
|
29,486 |
|
Total liabilities |
|
|
1,154,533 |
|
|
799,567 |
|
|
|
|
|
|
|
Total
stockholders' equity |
|
|
1,346,169 |
|
|
1,252,891 |
|
|
|
|
|
|
|
Total liabilities and stockholders' equity |
|
$ |
2,500,702 |
|
$ |
2,052,458 |
|
|
|
|
|
|
|
ALIGN TECHNOLOGY, INC. |
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
Year EndedDecember 31, |
|
|
|
2019 |
|
|
|
2018 |
|
|
|
|
|
|
CASH
FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
Net cash provided by operating activities |
|
$ |
747,270 |
|
|
$ |
554,681 |
|
|
|
|
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
Net cash provided by (used in) investing activities |
|
|
(350,444 |
) |
|
|
6,927 |
|
|
|
|
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
Net cash used in financing activities |
|
|
(485,540 |
) |
|
|
(369,434 |
) |
Effect of foreign exchange rate changes on cash, cash equivalents,
and restricted cash |
|
|
2,282 |
|
|
|
(4,733 |
) |
Net increase in cash, cash equivalents, and restricted cash |
|
|
(86,432 |
) |
|
|
187,441 |
|
Cash, cash equivalents, and restricted cash at beginning of the
period |
|
|
637,566 |
|
|
|
450,125 |
|
Cash, cash equivalents, and restricted cash at end of the
period |
|
$ |
551,134 |
|
|
$ |
637,566 |
|
|
|
|
|
|
ALIGN TECHNOLOGY,
INC. |
|
INVISALIGN BUSINESS
METRICS* |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
|
|
|
|
|
2018 |
|
|
|
2018 |
|
|
|
2018 |
|
|
|
2018 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
2019 |
|
|
|
2019 |
|
|
|
2019 |
|
|
|
2019 |
|
|
Invisalign Average Selling Price (ASP): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Worldwide
ASP |
|
$ |
1,310 |
|
|
$ |
1,315 |
|
|
$ |
1,230 |
|
|
$ |
1,235 |
|
|
$ |
1,270 |
|
|
$ |
1,245 |
|
|
$ |
1,230 |
|
|
$ |
1,260 |
|
|
$ |
1,240 |
|
|
$ |
1,245 |
|
|
|
International ASP |
|
$ |
1,435 |
|
|
$ |
1,425 |
|
|
$ |
1,340 |
|
|
$ |
1,295 |
|
|
$ |
1,370 |
|
|
$ |
1,330 |
|
|
$ |
1,305 |
|
|
$ |
1,330 |
|
|
$ |
1,300 |
|
|
$ |
1,315 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Invisalign Cases Shipped by Geography: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
|
166,665 |
|
|
|
181,425 |
|
|
|
190,615 |
|
|
|
189,410 |
|
|
|
728,115 |
|
|
|
202,935 |
|
|
|
211,360 |
|
|
|
215,355 |
|
|
|
225,925 |
|
|
|
855,575 |
|
|
|
International |
|
|
105,570 |
|
|
|
121,260 |
|
|
|
128,730 |
|
|
|
144,390 |
|
|
|
499,950 |
|
|
|
146,260 |
|
|
|
165,785 |
|
|
|
170,005 |
|
|
|
187,790 |
|
|
|
669,840 |
|
|
|
Total Cases Shipped |
|
|
272,235 |
|
|
|
302,685 |
|
|
|
319,345 |
|
|
|
333,800 |
|
|
|
1,228,065 |
|
|
|
349,195 |
|
|
|
377,145 |
|
|
|
385,360 |
|
|
|
413,715 |
|
|
|
1,525,415 |
|
|
|
YoY % growth |
|
|
30.8 |
% |
|
|
30.5 |
% |
|
|
35.3 |
% |
|
|
30.9 |
% |
|
|
31.9 |
% |
|
|
28.3 |
% |
|
|
24.6 |
% |
|
|
20.7 |
% |
|
|
23.9 |
% |
|
|
24.2 |
% |
|
|
QoQ % growth |
|
|
6.7 |
% |
|
|
11.2 |
% |
|
|
5.5 |
% |
|
|
4.5 |
% |
|
|
|
|
4.6 |
% |
|
|
8.0 |
% |
|
|
2.2 |
% |
|
|
7.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Invisalign Doctors Cases Were Shipped
To: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
|
27,105 |
|
|
|
28,280 |
|
|
|
28,890 |
|
|
|
29,215 |
|
|
|
42,000 |
|
|
|
30,200 |
|
|
|
31,445 |
|
|
|
31,975 |
|
|
|
33,130 |
|
|
|
47,130 |
|
|
|
International |
|
|
19,700 |
|
|
|
21,805 |
|
|
|
23,270 |
|
|
|
25,475 |
|
|
|
36,040 |
|
|
|
26,510 |
|
|
|
28,970 |
|
|
|
30,980 |
|
|
|
33,720 |
|
|
|
48,650 |
|
|
|
Total Doctors Cases Shipped To |
|
|
46,805 |
|
|
|
50,085 |
|
|
|
52,160 |
|
|
|
54,690 |
|
|
|
78,040 |
|
|
|
56,710 |
|
|
|
60,415 |
|
|
|
62,955 |
|
|
|
66,850 |
|
|
|
95,780 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Invisalign Doctor Utilization Rates**: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North
America |
|
|
6.3 |
|
|
|
6.6 |
|
|
|
6.9 |
|
|
|
6.7 |
|
|
|
18.2 |
|
|
|
7.0 |
|
|
|
7.0 |
|
|
|
7.0 |
|
|
|
7.2 |
|
|
|
19.4 |
|
|
|
North American Orthodontists |
|
|
15.3 |
|
|
|
16.4 |
|
|
|
17.4 |
|
|
|
16.5 |
|
|
|
56.7 |
|
|
|
18.3 |
|
|
|
18.9 |
|
|
|
19.1 |
|
|
|
19.3 |
|
|
|
65.0 |
|
|
|
North American GP Dentists |
|
|
3.4 |
|
|
|
3.6 |
|
|
|
3.5 |
|
|
|
3.6 |
|
|
|
9.1 |
|
|
|
3.6 |
|
|
|
3.6 |
|
|
|
3.5 |
|
|
|
3.8 |
|
|
|
9.5 |
|
|
|
International |
|
|
5.4 |
|
|
|
5.6 |
|
|
|
5.5 |
|
|
|
5.7 |
|
|
|
13.9 |
|
|
|
5.5 |
|
|
|
5.7 |
|
|
|
5.5 |
|
|
|
5.6 |
|
|
|
13.8 |
|
|
|
Total Utilization Rates |
|
|
5.8 |
|
|
|
6.0 |
|
|
|
6.1 |
|
|
|
6.1 |
|
|
|
15.7 |
|
|
|
6.2 |
|
|
|
6.2 |
|
|
|
6.1 |
|
|
|
6.2 |
|
|
|
15.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Invisalign Doctors Trained: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
|
1,630 |
|
|
|
1,880 |
|
|
|
2,085 |
|
|
|
2,290 |
|
|
|
7,885 |
|
|
|
1,840 |
|
|
|
3,070 |
|
|
|
2,760 |
|
|
|
2,095 |
|
|
|
9,765 |
|
|
|
International |
|
|
2,645 |
|
|
|
3,300 |
|
|
|
2,845 |
|
|
|
2,980 |
|
|
|
11,770 |
|
|
|
2,410 |
|
|
|
3,520 |
|
|
|
3,135 |
|
|
|
3,445 |
|
|
|
12,510 |
|
|
|
Total Doctors Trained Worldwide |
|
|
4,275 |
|
|
|
5,180 |
|
|
|
4,930 |
|
|
|
5,270 |
|
|
|
19,655 |
|
|
|
4,250 |
|
|
|
6,590 |
|
|
|
5,895 |
|
|
|
5,540 |
|
|
|
22,275 |
|
|
|
Total to Date Worldwide |
|
|
136,575 |
|
|
|
141,755 |
|
|
|
146,685 |
|
|
|
151,955 |
|
|
|
151,955 |
|
|
|
156,205 |
|
|
|
162,795 |
|
|
|
168,690 |
|
|
|
174,230 |
|
|
|
174,230 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Invisalign business
metrics exclude SmileDirectClub aligners. |
|
** # of cases shipped
/ # of doctors to whom cases were shipped. LATAM utilization rate
is not separately disclosed, but included in the total utilization
rates. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALIGN TECHNOLOGY,
INC. |
|
STOCK-BASED
COMPENSATION |
|
(in
thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
|
Q1 |
|
Q2 |
|
Q3 |
|
Q4 |
|
Fiscal |
|
|
|
|
2018 |
|
2018 |
|
2018 |
|
2018 |
|
2018 |
|
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2019 |
|
Stock-based Compensation (SBC) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SBC included
in Gross Profit |
|
$ |
881 |
|
|
$ |
900 |
|
|
$ |
966 |
|
|
$ |
948 |
|
|
$ |
3,695 |
|
|
$ |
1,112 |
|
|
$ |
1,278 |
|
|
$ |
1,354 |
|
|
$ |
1,410 |
|
|
$ |
5,154 |
|
|
|
SBC included
in Operating Expenses |
|
|
14,949 |
|
|
|
15,990 |
|
|
|
18,232 |
|
|
|
17,897 |
|
|
|
67,068 |
|
|
|
19,932 |
|
|
|
21,189 |
|
|
|
22,822 |
|
|
|
19,087 |
|
|
|
83,030 |
|
|
|
Total SBC |
|
$ |
15,830 |
|
|
$ |
16,890 |
|
|
$ |
19,198 |
|
|
$ |
18,845 |
|
|
$ |
70,763 |
|
|
$ |
21,044 |
|
|
$ |
22,467 |
|
|
$ |
24,176 |
|
|
$ |
20,497 |
|
|
$ |
88,184 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ALIGN TECHNOLOGY, INC. |
|
|
|
|
BUSINESS
OUTLOOK SUMMARY |
|
|
|
|
(unaudited) |
|
|
|
|
|
|
|
|
|
The outlook figures provided below and elsewhere in this press
release are approximate in nature since Align’s business outlook is
difficult to predict. Align’s future performance involves numerous
risks and uncertainties and the Company’s results could differ
materially from the outlook provided. Some of the factors that
could affect Align’s future financial performance and business
outlook are set forth under “Forward Looking Statements” above in
this press release. Please refer below for GAAP to Non-GAAP
Reconciliation. |
|
|
|
|
|
Q1
2020 Financial Outlook |
|
|
|
|
(in millions, except per share amounts and percentages) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP |
|
Non-GAAP |
|
|
|
|
|
Net
Revenues |
|
$615 -
$630 |
|
|
|
|
|
|
|
Gross Margin |
|
71.5% -
72.0% |
|
71.7% -
72.2% |
|
|
|
|
|
Operating Expenses |
|
$345 -
$350 |
|
$321 -
$326 |
|
|
|
|
|
Operating Margin |
|
15.4% -
16.5% |
|
19.5% -
20.5% |
|
|
|
|
|
Net
Income per Diluted Share |
|
$18.65 -
$18.74 |
|
$1.19 -
$1.28 |
Effective Tax Rate |
|
approx
(1,440%) - (1,302%) |
|
approx 22%
- 23% |
|
|
|
|
|
Business Metrics: |
|
|
|
|
|
|
|
|
|
Case
Shipments |
|
396K -
406K |
|
|
Capital
Expenditures |
|
$95M -
$100M |
|
|
Depreciation
& Amortization |
|
$23M -
$25M |
|
|
Diluted
Shares Outstanding(1) |
|
79.1M |
|
|
Stock Based
Compensation |
|
approx
$25M |
|
|
|
|
|
|
|
|
|
|
|
|
(1) Excludes any stock repurchases during the quarter |
|
|
|
|
|
|
|
|
|
|
Q1'20 Reconciliation of GAAP to Non-GAAP |
|
|
|
|
|
|
|
|
|
in millions,
except per share amounts and percentages |
|
Q1'20 Guidance |
|
|
GAAP Gross Margin |
|
71.5% - 72.0% |
|
|
Stock Based Compensation |
|
0.2% |
|
|
Non-GAAP Gross Margin |
|
71.7% - 72.2% |
|
|
|
|
|
|
|
GAAP Operating Expenses |
|
$345 - $350 |
|
|
Stock Based Compensation |
|
($24) |
|
|
Non-GAAP Operating Expenses |
|
$321 - $326 |
|
|
|
|
|
|
|
GAAP Operating Margin |
|
15.4% - 16.5% |
|
|
Stock Based Compensation |
|
4.0% |
|
|
Non-GAAP Operating Margin |
|
19.5% - 20.5% |
|
|
|
|
|
|
|
GAAP Effective Tax Rate* |
|
(1,440%) - (1,302%) |
|
|
Stock Based Compensation |
|
6.1% |
|
|
Tax Impact of Non-GAAP Items* |
|
1,461% - 1,325% |
|
|
Non-GAAP Effective Tax Rate |
|
22% - 23% |
|
|
|
|
|
|
|
GAAP Diluted EPS |
|
$18.65 - $18.74 |
|
|
Stock Based Compensation |
|
$0.24 |
|
|
Tax Impact of Non-GAAP Items |
|
($17.70) |
|
|
Non-GAAP Diluted EPS |
|
$1.19 - $1.28 |
|
|
|
|
|
|
|
*Tax rate reflects
a significant one-time tax benefit associated with the recognition
of a deferred tax asset related to the intra-entity sale of certain
intellectual property rights. This deferred tax benefit will be
amortized starting in 2020 and continue into subsequent quarters
and years. |
|
Align Technology (NASDAQ:ALGN)
Historical Stock Chart
From Apr 2024 to May 2024
Align Technology (NASDAQ:ALGN)
Historical Stock Chart
From May 2023 to May 2024