Good morning, and welcome to AngioDynamics' Fourth Quarter and Fiscal Year 2022 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference call is being recorded. The news release detailing our fourth quarter and fiscal year 2022 results crossed the wire earlier this morning and is available on the Company's website. This conference call is also being broadcast live over the Internet at the Investors section of the Company's website at www.angiodynamics.com and the webcast replay of the call will be available at the same site approximately one hour after the end of today's call. Before we begin, I would like to caution listeners that during the course of this conference call, the Company will make projections or forward-looking statements regarding future events, including statements about expected revenue, adjusted earnings and gross margins for fiscal year 2023, as well as trends that may continue. Management encourages you to review the Company's past and future filings with the SEC, including without limitation, the Company's Forms 10-Q and 10-K, which identify specific factors that may cause the actual results or events to differ materially from those described in the forward-looking statements. The Company will also discuss certain non-GAAP financial measures during this call. Management uses these measures to establish operational goals and review operational performance and believes that these measures may assist investors in analyzing the underlying trends in the Company's business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting measures prepared in accordance with GAAP. A slide package offering insight into the Company's financial results is also available on the Investors section of the Company's website under Events and Presentations. This presentation should be read in conjunction with the press release discussing the Company's operating results and financial performance during this morning's call. I'd now like to turn the call over to Jim Clemmer, AngioDynamics' President and Chief Executive Officer. Mr. Clemmer?

Thank you, Rob, and good morning, everyone, and thank you for joining us for AngioDynamics' fiscal '22 fourth quarter earnings call. Joining me on today’s call is Steve Trowbridge, AngioDynamics' Executive Vice President and Chief Financial Officer, who will provide a detailed analysis of our fourth quarter financial performance and our FY ‘23 guidance. We had a strong end to fiscal 2022 as we delivered solid revenue growth in the face of significant supply chain and operation headwinds, as well as challenges that our customers are facing in delivering care to patients. We ended the quarter with revenue of $87 million, representing growth of more than 13% year-over-year. Net sales from our Med Tech platforms were $22.6 million, representing growth of 40% over the fourth quarter of last year. Revenue for the full fiscal year was $316.2 million, representing growth of almost 9% over the previous year. Our Med Tech platforms grew more than 41% compared to fiscal 2021 and comprised approximately 25% of our overall revenue base for the full year, up from 19% a year ago. As we've highlighted in the past, as part of our corporate strategy, we expect this percentage to grow over time. Fiscal 2022 once again presented a unique challenge with historically high inflation rates, staffing and procedure headwinds and supply chain disruptions persisting throughout the year with varying intensity. Throughout all of this, we continue to prioritize the growth of our Auryon, NanoKnife and thrombectomy platforms while keeping a focus on our cash position and profitability. Through our R&D programs, we launched innovative new products, including two sizes of our AlphaVac mechanical thrombectomy device that will help round out physicians’ arsenal to treat venous thromboembolism and advance our position in this exciting market in fiscal 2023 and beyond. We also launched two studies,…

Thanks Jim. Good morning everybody. Before I begin, I'd like to direct everyone to the presentation on our investor relations website, summarizing the key items from our quarterly results. Revenue for the fourth quarter of FY ‘22 increased 13.2% year-over-year to $87 million, driven by continued strength in our Med Tech platforms, including Auryon, NanoKnife and thrombectomy. Med Tech revenue was $22.6 million, 40% year-over-year increase, while Med Device revenue was $64.4 million growing 6.1% compared to the fourth quarter of FY ’21. For FY ‘22 our Med Tech platform grew 41.2%. Our Med Device business grew 0.9% compared to the prior year period and grew 3.2% year-over-year when excluding last year's NHS order. For our fourth fiscal quarter, our Med Tech platforms comprised 26% of our total revenue. In FY ‘22 our Med Tech platforms comprised 25% of our total revenue compared to 19% in fiscal 2021. Overall demand during the quarter remained strong. As I will discuss in more detail a little later, we ended May with an $8.4 million backlog, which represents a meaningful reduction in the total backlog from the levels we reported for March. When taken with our fourth fiscal quarter revenue result of $87 million the $8.4 million backlog provides clear evidence of both our improving manufacturing capacity and a continued strong demand environment. Revenue in our Endovascular Therapies business increased 18.5% year-over-year during the fourth quarter to $45.1 million benefiting from the continued growth of Auryon and our thrombectomy portfolio. Auryon contributed $9.6 million in revenue during the fourth quarter, continuing the momentum we built since our launch in FY ’21. As of today, our installed base is 306 lasers with 31 lasers placed during the fourth quarter. We're very pleased with the growth that our Auryon teams have achieved and new laser…

Thank you, Steve. I am very proud of our performance over the past year as we work to overcome a host of macro challenges while continuing our transformation into an innovative growth oriented medical technology company. We delivered on the strategic objectives for FY ‘22 that we laid out for you in last year's Investor and Technology Day. We provided revenue guidance last summer, and we were able to raise that guidance after Q1 and we finished the year $1 million above that increased guidance range. We were able to report full year EPS that was within the range of original guidance despite facing macroeconomic headwinds, as well as labor and supply chain disruptions that pressured profitability and required us to lower our expectations around gross margins during the year. As we've maintained, we remain in investment mode, prioritizing investments in our people and capabilities, both of which are foundational to our transformation. The results of these investments bore out over the course of the year and included the launch of our AlphaVac F22 and our AngioVac and AlphaVac F18 products. We have also focused our investment on clinical trials to generate data that we believe will drive physicians and patients to our platforms. We are excited about our AlphaVac APEX pulmonary embolism study and our PRESERVE NanoKnife prostate study. We remain on track to meet the long-term financial goals that we laid out for you last July, as evidenced by an increase to our FY 2023 revenue range and the ongoing mix shift toward our higher growth and higher margin Med Tech platforms and products. We believe that these goals contemplate the investment needed to transform the company and introduce new products in higher growth markets while expanding indications for existing products, setting us up for sustainable growth. Slide…

Thank you. We'll now be conducting in the question-and-answer session. [Operator Instructions] Thank you. Our first question is coming from the line of Jayson Bedford with Raymond James. Please proceed with your questions.

Hi, good morning and thanks for all the detail. I guess, just a few from me to start. On the fiscal 2023 guide, do you assume that the backlog gets exhausted during the year?

Hey Jason, good morning. So I think it's similar to how we thought about FY 2024. We're going into FY or I'm sorry, Q4 of FY 2022. We're going into FY 2023 with respect to the backlog. So as we worked through the backlog in Q4, we saw some of that come down and that was beneficial to our results. We're not fully banking on a 100% of that in our FY 2023 guide. Now, as Jim and I have talked in the past, we think that there's probably some double ordering in there as we work through this. We don't know exactly how much. So we're going to be thoughtful as we work through that backlog. Sure, it provides a little bit of a safety net, but a lot of our FY 2023 guidance was really built from the bottom-up. So I do expect that we're going to continue to work through that backlog over the course of the first two quarters of FY 2023, but it's not like all of what's left of that backlog we consider to be incremental to where our results were heading. We really did build it up from the bottom-up.

Okay. And, and just thinking through the revenue bridge, is there an expectation contemplated in the guide that Oncology and Vascular Access grow year-over-year in fiscal 2023?

Yes. As we've talked about, when you think about our Med Device businesses, we have the same view of that business that we had when we came out with our Investor and Technology Day in July. We see that business as a 1% to 3% grower oncology, other than NanoKnife is included in that device business category, along with VA and our core angiographic catheter business. We do expect NanoKnife is going to continue to be a strong double-digit grower on top of that. So, you could use that 1% to 3% range for all of devices and then some of the other detail that we gave you in our Med Tech products together to get to that guide that we gave you of $342 million to $348 million.

Okay. And not to get two granular here, but when you say double-digit NanoKnife growth is that total NanoKnife or is just procedure growth?

It's procedures. It -- primarily we're talking disposables, right? So that, solid double-digit growth primarily coming from disposables, well all coming from disposables.

Okay, helpful. Just on the thrombectomy category, you mentioned volume, the procedure challenges impacting the space. Is this largely in reference to the staff shortage dynamic at hospitals, or are there other factors here that are impacting -- that are impacting growth?

We do think it's largely coming from those staffing challenges at hospitals. We've talked about AngioVac in the past as being a complex procedure. It can do things that other competitive technologies cannot do, but it does require additional staffing at the hospital when you have to bring in the perfusionist and you're working through the anesthesia and then a lot of times moving into an ICU bed. And we think that that did weigh on procedure volume for AngioVac, as hospitals were dealing with their staffing challenges.

Okay. And then just last question and I'll get back in queue. Just on AngioVac and the softness there, are you seeing any, and I know it’s tough here, but any AlphaVac cannibalization of AngioVac in any way?

Jason, we're watching it. It's Jim. We expect it to be some, we built it into our models because we think the AlphaVac is so strong and powerful, it may do some things where AngioVac may have been utilized before. So we modeled that. We learned some of that in our limited market release. So we'll watch it over time, Jason. There will be a gap between or crossover between where AlphaVac can serve and AngioVac can serve, but we're being real close with our customers. We think it's far offset by the open markets it helps us to get into, and the new patients we think AlphaVac can treat.

Okay. Thank you.

Our next question comes from the line of Bill Plovanic with Canaccord. Please proceed with your question.

Great. Thanks. Good morning. Just to drill down a little more, the Auryon has, I mean, far exceeded our expectations and just curious is, looking you've been taking share, originally I think you said in the laser market, now that's moving into the other more mechanical type of devices. But as you think about the future with less placements and increased utilization, I mean, how much utilization do you think you can see per system? How many procedures are you kind of getting with a given customer versus what you could penetrate with that customer? I was wondering if you could give us a little more flavor maybe on how - what we should expect. I know you gave us the numbers, but how that kind of plays out executionally in the accounts?

Yes, hi, Bill, good question. Again, we're really pleased with the Auryon business. As you know, a couple of years ago, we were attracted to this asset due to the way it operates, how it treats, and also the market potential that we saw for disruptive technology such as this, and now that's proving to be what's happening. So back to your question, as you know, we identified over 300 lasers already placed in less than two years from our full launch. It will still continue to occur, but we'll bend it a little bit. We want to make sure now we're focused on the efficacy of each account. As you said, we have internal metrics that we track and trace. We know by the end of every month, how many hospital customers or OBLs treated, how many patients with our product. We don't release all that information publicly, but we do have goals we’ve set there to expand that. The reasons why Bill that's important to us, because we find that when customers get access to the technology, after a few months, they gain increase in confidence, not just in the safety profile of how our product works and keeping the vessel wall protection, integrity, and safety, our profile up to their standards, but also the power that it delivers to treat above, below the knee, and to in-stent restenosis. And as we're now learning other things, over time as we identified on our pipeline chart. So we'll probably not release the exact detail, Bill, as to how many procedures we do monthly by each customer, but we're really confident we’re getting not just more procedures by each customer, we're finding new and larger customers get attracted to this technology and come on board. So that's why as Steve identified, we're not going to hold back on putting more lasers in the field. There's a strong demand, but we also want to, make sure that we can affix and see in current customers.

Okay. And then on AlphaVac, $2.2 million in the year go into $7 million to $9 million going into full market launch with the 18-French. And just as you think about that step up from year one to year two, how much of that is with the existing 22-French or is it mostly incremental with the 18-French and just getting into different parts of the body?

Yes, Bill good question. We're excited. The 18-French we think will be integral to get us into more areas of the body, more treatment potential for us. So the 22 is very powerful and that was our first device. But as you saw in our strategy, the 18 is really, really important to us and we thought that was the perfect device for the APEX study. That's why we launched the APEX study. We feel the 18 can be a really important tool to treat PE. And as you know, over time Bill, we have in our plans to launch a smaller size to round out the AlphaVac potential. But again, each time we open up a smaller size, we expect that market to expand for us over time.

And just to kind of wrap it up for me with financial, just as we think of the August quarter in guidance you gave the year, but given all the puts and takes, just wondering if you give us maybe a little more granularity on how that will look sequentially from May to August? And then on the tax rate, just, I don't think you gave tax rate guidance, but if you could help us out, I think you'd been averaging in the low 12%, 13% historically on a GAAP and is that what we should kind of model going forward? Thanks.

Yes. Hey Bill, this is Steve. So, we give annual guidance, we don't give the quarterly guidance, but what I would say is we've had pretty identifiable seasonality patterns in the past. You typically see Q4 being our highest quarter, Q1 sequentially down two, up from one, three down from two, and then back to four being the highest quarter. I would expect that you're going to see similar patterns. Now we've seen a little bit of a smoothing of that in our growth trajectory, coming from the launch of our new products. And so you may see some tempering, but all in all, I think it's a good idea to continue to expect to see some of that same seasonality as we move forward.

Great, thanks.

The next question is from the line of Matthew Mishan with KeyBanc. Please proceed with your question.

Hey, good morning guys. Thank you for taking the questions. I think I'll just start off with NanoKnife. You guys spent a lot of time on the call talking about prostate, more than usual. What do you think is driving the increase in the number of prostate procedures? Is it specifically the PRESERVE study?

Hi, Matt, thanks for the question. It's a few things going on at once. We think PRESERVE is highlighting now our commitment to the space to become a focal treatment option, but it probably goes back a little before that. I think doctors still understand the mechanism of action of NanoKnife, how it does what it does is vitally important. And we've seen other work being published by physicians globally who've done really important work in collective data. The efficacy and the safety profile has been generated by utilizing NanoKnife and prostate outside of the U.S. So I think some of the physicians here have seen that data. It helped encourage us to pursue the IDE that we did with the FDA. And now I have this kind of a halo effect, and I've talked to a lot of these physicians to understand it, myself and physicians believe that focal treatment needs a better option. And they want to give patients that option for a really effective focal treatment and it hasn't really existed with the other two main platforms in the focal arena. So we're really encouraged Matt. We're seeing really big facilities come online, seeing a lot of enthusiasm around our product as it's used. It's simple to use. It's easy. The patients get benefit pretty much immediately. So we're really excited to track the PRESERVE study. As I identified in our call, we think the intermediate risk patients are about 40%, about a 100,000 of the quarter million patients identified in the U.S. annually that we think those folks could be potential treatment options for this focal treatment over time. And that's why we also shared with you a market in excess of maybe $700 million over time. So we're going to work towards that map. That's why we're excited. We think it gives patients that option.

And Matt, what I would add to that is, we've talked about this in the past. We really like and are excited about the opportunity of NanoKnife as a focal treatment option. And we think the timing is actually working really well today. So as Jim mentioned, urologists are looking for a focal treatment option, something that can fit in between watchful waiting or active surveillance and going to a radical prostatectomy given all of the side effects that are typical when you go to surgery. So you've got the industry looking for a focal treatment option. Over the last handful of years there's been significant advancements in imaging technology, which are giving those urologists the opportunity to pinpoint the lesions and maybe go after those areas with a focal treatment option that they're looking for a little bit more so than they could have in the past. And as we've also talked about in the past, the regulatory environment has shifted where it's more conducive to going and getting an indication to go after prostate tissue, whereas in the past, if you couldn't bifurcate the difference between oncology outcomes and overall survival between that versus the efficacy of just treating tissue, getting an indication probably would have been cost as well as time prohibitive. So all three of those things are coming together at the right time and we also think we've got the right technology given all of the experience that Jim talked about. We know that we can preserve some really good quality of life for those intermediate risk patients and so we think the timing is right.

And the docs that are doing these procedures in the prostate, are they utilizing the existing bases, the existing installed base of NanoKnife that's already placed in multiple hospital systems, are the consumables fairly interchangeable between those two procedures? And then how are you thinking about potentially differentiating between price of prostate versus a pancreas procedure?

So the disposables are absolutely transferable. So the disposables that are out in the market today are perfectly suitable for the prostate procedures. The installed base is growing with urologists. I mean our historical base where we have been focusing on the liver and pancreatic market were usually those hepatobiliary [ph] surgeons in the hospital, now it could be in the same hospital, but it is a little bit of a different call point with urologists. So we see an opportunity to really expand that installed base as we drive our prostate procedures. And then the question around timing as well as pricing, there will be some differences, especially as we get through our trial and we get to the point that we have a specific indication for prostate. Absolutely, there's going to be market-specific pricing that makes it the most appropriate for the use of those physicians as well as the patients that differentiates between an in-surgery setting versus the prostate setting.

Okay. On moving to AlphaVac, I think you said the total sales for the year were about $2.2 million. What is implied in the FY 2023 guidance for AlphaVac F18 and F22?

Yes, so we are got -- we said about $7 million to $9 million is what you should expect for AlphaVac in FY 2023.

Okay. And last question on the Med Tech gross margins in the 65% to 68% range, I'm assuming that's currently with supply chain and ramping. Where does that -- where do you think that can go over the next several years as sales reps that you think they can?

Yes. We think those high 60s is a good way to think about this business. Now there's some puts and takes. We've talked about some of the startup costs as it relates to installing the Auryon lasers are there, although that's been abating over the last year. I talked about the depreciation expense that you're going to have running through gross margins based upon the lasers that we place, so that's going to be one factor. We had some pickups in margin with moving manufacturing of the AlphaVac lines from a third party supplier to in-house. So we'll do all those things that you would expect us to do for kind of typical gross margin improvement over time as we see appropriate, but in the level that we gave you, we think you can model the idea of our Med Tech business at being at that level of a gross margin, you can see the difference between tech and device.

Thank you very much, guys.

Thanks, Matt.

Thank you. At this time, we've reached the end of our question-and-answer session. I'll hand the floor back to Mr. Clemmer for closing remarks.

Thanks, Rob. And thanks for those who joined us. Again we’re really proud of our company and really from our people that serve our customers who serve patients in need. We hope you'll see that we're creating value for those patients. They can get better faster through the use of our technology. We think you'll also see we're giving our employees a place where they can shine and engage them with their talents and do what they do best here at Angio and they have a place to thrive. And finally, for our investors, we hope you'll see we're creating a company that we think is more interesting and more valuable over time as we continue our transformation to be a high-tech, high growth profitable Med Tech company. Thanks for joining us today.

This will conclude today’s conference. Thank you for your participation. You may now disconnect your lines at this time.