Q4 2021 STAAR Surgical Co Earnings Call
Good day, ladies and gentlemen, thank you for standing by welcome to the STAAR surgical fourth quarter and fiscal year financial results Conference call.
During todays presentation all parties it parts of the parties will be in a listen only mode.
Following the presentation the call will be opened for questions.
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This call is being recorded today Wednesday February 23rd 2022.
At this time I would like to turn the conference over to Mr. Brian Moore, Vice President Investor Media Relations and corporate development for STAAR surgical.
Thank you operator, and good afternoon, everyone.
Thank you for joining us on the STAAR surgical conference call. This afternoon to discuss the company's financial results for the fourth quarter and fiscal year ended December 31 2021.
On the call today are Caren, Mason, President and Chief Executive Officer and.
And Patrick Williams, Chief Financial Officer.
The press release of the fourth quarter results was issued just after four P. M. Eastern time and is now available on staar's website at Www Dot Star Dot com.
Before we begin let me quickly remind you that during the course of this conference call. The company will make forward looking statements. We caution you that any statement that is not a statement of historical fact is a forward looking statement. This includes remarks about the company's projections expectations plans beliefs and prospects lease.
These statements are based on judgment and analysis as of the date of this conference call and are subject to numerous important risks and uncertainties that could cause actual results to differ materially from those described in the forward looking statements.
The risks and uncertainties associated with the forward looking statements made in this conference call and webcast are described in the Safe Harbor statement in today's press release as well as staar's public periodic filings with the FCC.
Except as required by law STAAR assumes no obligation to update these forward looking statements to reflect future events or actual outcomes and does not intend to do so.
In addition to supplement the GAAP numbers, we have provided non-GAAP adjusted net income and adjusted earnings per share and sales in constant currency.
We believe that these non-GAAP numbers provide meaningful supplemental information and are helpful. In assessing our historical and future performance a table reconciling the GAAP information to the non-GAAP information is included in today's press release.
Following our prepared remarks, we will open the line to questions from publishing analysts, we ask analysts limit themselves to two initial questions then re queue with any follow ups. We thank everyone in advance for their cooperation with this process and with that I would now like to turn the call over to Caren Mason President and.
CEO of STAAR.
Yeah.
Thank you Brian Good afternoon, everyone and thank you for joining us on today's call.
The fourth quarter results, we reported today are consistent with the preliminary results, we announced last month.
Fourth quarter results contributed to another record year of sales profit cash flow and growth achievement for star in fiscal 2021.
We achieved all of this despite some ongoing COVID-19 and operations related headwinds.
Our results were driven by global ICL unit growth for the full year fiscal 2021, which was up 48% year over year and almost three times, the 17% increase in global industry refractive procedures.
Turning to their fourth quarter, we achieved strong growth in several markets, including ICL unit growth in China up, 44%, Japan up 45%, South Korea up, 35%, India up 74% and Latin.
America up 30%.
As compared to the prior year quarter.
All of the major regions, we track achieved positive ICL unit growth year over year for the fourth quarter of 2021.
European geographies as many of you know were most impacted by the emerging omicron Covid variant during the fourth quarter of 2021.
Covid impacted certain of our European customers and in the U S Starz manufacturing operation.
Employee absenteeism was the major headwind in those cases with staff and employees quarantining at various times during the fourth quarter, mostly due to household or contact tracing COVID-19 protocols.
We believe the worst of these headwinds are now lessening.
Global demand for our ICL continues unabated through their first seven weeks of the first quarter of 2022, including record orders from surgeons in China.
Based on our current demand and the supply forecast we are reaffirming our previously provided outlook for fiscal 2022 net sales of approximately $295 million subject to no unforeseen impacts from Covid on our business.
$295 million and net sales represent 28% year over year growth, which is an acceleration from our pre pandemic level of growth in fiscal 2019 and would represent another record year of sales for star.
Patrick will provide details on the calendar innovation and composition of our sales outlook shortly.
Turning to the U S. Our submission of clinical data for Staar's Evo family of Myopia lenses remains under customary interactive FDA review.
While our expectation of pre Covid approval timelines by the FDA has now passed we remain confident regarding an approval of our PMA supplement we will provide further comment on the process and our interactions with the FDA when permitted and appropriate to do so.
The U S is the second largest market in the world for refractive procedures.
We estimate that there are a very significant 100 million U S. Adults, who are potential candidates for our implantable <unk> lenses.
As adults are age 21 to <unk> 45, with myopia in the range of minus three Diopters and minus 15, Diopters, which are our currently approved ranges in the U S.
In 2022, we plan to invest more heavily in consumer awareness building programs designed to accelerate the paradigm shift to lens based vision correction.
Our seeking commitments from new and exciting celebrity brand ambassadors in the U S and abroad, who plan to share their journeys to the visual freedom provided by our Evo lenses.
We will also continue to engage surgeons and their staffs globally through clinical validation education and strategic cooperation in fiscal 2022.
Our implantable column or lenses are suitable for a wide range of vision correction, which in some markets extends down the diopter curve to minus 0.5, Diopters I am pleased to report today that for the full year of fiscal 2021, almost two thirds.
Of our ICL sold globally, we're in the range of minus 0.5 to minus 10 Diopters.
In April we will engage the ophthalmic community with a strong presence at the American Society of cataract and refractive surgery. The Crs annual meeting in Washington, D C where we.
We anticipate thousands of U S surgeon in clinic attendees.
Our medical monitor.
For our U S study Dr. Mark Packer submitted his abstract to <unk> Crs and we look forward to sharing the clinical data at that time.
Later this year in September we plan to host an experts meeting ahead of the European Society of cataract and refractive surgery. The Es Crs annual Congress, which is also historically attended by a strong contingent of global Surgeons, where we plan to kick off the full <unk>.
<unk> of our presbyopia lenses.
All told we anticipate fiscal 2022 will be another record year of commercial and financial progress for Star <unk>.
Patrick.
Thank you Karen and good afternoon, everyone.
Net sales for Q4 2021 were $59 million.
8% as compared to the $46 million of net sales in Q4 2020.
And up 1% on a sequential basis from Q3 2021.
Year over year increase in net sales was attributable to a 33% increase in ICL sales, partially offset by a decline in other product sales.
As Karen mentioned, our outlook for fiscal 2022 is net sales of $295 million.
We anticipate returning to a more normal pre pandemic calendar information of sale in 2022 with approximately 48% of net sales in the first half of the year, which is consistent with our 2019 results.
As a reminder, Q1 and Q4 habits directly represented our seasonally lowest quarter.
We expect net sales for Q1 2020 to be similar or slightly up from Q4 2021.
Q2, net sales, but still represent our seasonally highest quarter for the year.
Turning back to Q4 2021 in terms of product mix ICL sales represented 90% of total company net sales for the fourth quarter as compared to 87% of total company net sales in the year ago quarter.
Other product sales represented 8% of total company net sales for the full year fiscal 2021.
For the full year fiscal 2022, we anticipate other product sales will be approximately 5% of total company net sales as our ICL business continues to grow at a much higher rate.
Gross profit for Q4, 2021 was $45 million or 76, 3% of net sales as compared to gross profit of $34 3 million or 74, 6% of net sales for Q4 2020.
$45 3 million or 77, 6% of net sales for Q3 2021.
The 170 basis point increase in gross margin as compared to Q4 2020 is primarily due to the higher mix of ICL, partially offset by higher expenses related to manufacturing projects.
The sequential decrease in gross margin from the third quarter is due to lower ICL sales mix in Q4 at 90% as compared to 93% in Q3.
For fiscal year 2021, gross margin was 77, 5%.
We expect Q1 and full year 2022 gross margin to be approximately 77%.
Increased investments in manufacturing, including at our need out, Switzerland, and Lake Forest, California manufacturing facilities.
Moving down the income statement total operating expenses for Q4, 2021 were $37 $6 million as compared to $30 2 million in Q4, 2020, and $37 5 million for Q3 2021.
Taking a closer look at the components of operating expenses G&A expense for Q4, 2021 was $11 $5 million compared to $9 5 million for Q4, 2020 and $11 million for Q3 2021.
The year over year increase in G&A is due to increased compensation related costs facility costs and outside services.
The sequential increase from Q3 2021 was due to increased compensation related expenses.
For the full year 2021, G&A expense was $44 1 million or 19, 1% of total net sales.
For full year 2022, we expect G&A expense to be approximately 13 million to $14 million per quarter.
Selling and marketing expense was $17 1 million for Q4 2021 compared to 11 8 million for Q4 'twenty 'twenty.
$18 2 million for Q3 2021, the increase in selling and marketing expense from the prior year was due to increased advertising and promotional expenses.
Safety related expenses and trade show and meeting expenses due to the ICL awareness building activities Caren mentioned earlier.
For fiscal 2021, selling and marketing expense was $67 3 million or 29, 2% of total net sales.
For the full year 2022, we expect selling and marketing expenses as a percent of sales to represent approximately 30% to 32% per quarter.
And to be at the higher end of this range in Q2, and Q3 to support sales during our busiest quarters.
Research and development expense was $9 1 million in Q4, 2021 compared to $9 million for Q4, 2020, and $8 3 million for Q3 2021.
The sequential increase in R&D is due to increased compensation related expenses offset by a decrease in our U S. Evo clinical trial expense.
For fiscal 2021 research and development expense was $33 9 million or 14, 7% of total net sales.
And for the full year 2022, we expect R&D expense to be approximately $10 million per quarter.
Operating income in Q4, 2021, with $7 4 million and 12, 5% of net sales as compared to $4 1 million or eight 8% of net sales for Q4 2020.
The 370 basis point year over year expansion in operating margins due to leverage on fixed and variable operating expenses during the quarter.
Operating margin for the full year fiscal 2021 was a was a record 14, 5%.
We expect operating margin for full year 2022 to be similar to fiscal 2021 as anticipated leverage on general and administrative and research and development expenses is offset by important investments in selling and marketing targeted building ICL awareness and market share.
Net income in Q4, 2021 was $4 9 million or <unk> 10 per diluted share compared to net income of $3 3 million or seven cents per diluted share in Q4 2020.
On a non-GAAP basis adjusted net income for Q4, 2021 was $9 $5 million or <unk> 19 per diluted share compared to adjusted net income of $6 $8 million or <unk> 14 per diluted share in Q4 2020.
For the full year 2022 subject to no significant changes in our valuation allowance, we anticipate our tax rate by quarter and for the full year will be approximately 30%.
A table reconciling the GAAP information to the non-GAAP information is included in today's financial release.
Turning now to our balance sheet, our cash and cash equivalents as of December 31, 2021 totaled $199 7 million up $47 $2 million compared to $152 5 million at the end of the fourth quarter of 2020.
The increase in cash was primarily attributable to $44 million in cash generated from operations.
We invested $13 $7 million in property and equipment in fiscal 2021 for the full year 2022, we anticipate our capex will be approximately $20 million as we continue to invest in scaling our manufacturing infrastructure.
Finally, we will be participating in the Canaccord non deal Road show on March 10, and the Oppenheimer Annual Healthcare conference on March 15, we look forward to speaking with many of you at these events.
This concludes our prepared remarks, operator, we are now ready to take questions.
Uh huh.
Thank you.
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Our first question is from Bill <unk> of Canaccord.
Hi, it's John on for Bill Tonight, Thanks for taking our questions.
Just wanted to.
Dive a bit deeper on where you are currently in your discussions with the FDA.
Can you.
Just talk about have you begun discussing the label or the post approval study.
So this is Karen thank you for joining US today, John can you hear me okay.
Hi, Ken Thanks Darren.
Hey, great.
So.
What we said in the script remains true we are in customary interactive review with the FDA and we really don't comment any further as to process or progress other than to tell you confidently that we feel very good about getting a positive result.
For our submission.
Got it thank you Darren.
And then just as a follow up.
Maybe touching on China, and the Olympics, how should we think about the impact of the Olympics provide any unique branding opportunities for star in China, and do you think that could portend to shire growth and will be seasonally see from China in Q1.
Well as we address the first seven weeks of the year in China had been particularly strong.
We had record orders from surgeons.
And so obviously, we've had a lot more patient flow.
And I can't say that that's attributed to the Olympics, but what I can say is that there is a lot of positive progress with regard to social media and digital marketing as well as a lot of streaming media associated with the benefits of <unk>.
And so we continue that those great programs very successfully and so we attribute that in a lot of the great work of our team in China and the outstanding work of the surgeons in China to why Evo continues to gain market share in refractive procedures in China.
Thanks Darren.
Thank you John .
Yeah.
Our next question is from Zach Weiner of Jefferies.
Hey, Thanks for taking the question I just wanted to jump in on.
The backlog that you called out in your pre announcement, you called out 20000 lenses.
I believe that's consistent with the three Q Ruiz also just curious word backlog currently stand and if any of that backlog is factored into our full year 2022 guidance.
So thanks for joining us back in terms of our backlog, yes, we continue to have a healthy backlog.
Some of that is figured in but I wouldn't be surprised with momentum is strong as it is with current orders.
And backlog you know it certainly gives us an opportunity to over perform.
Got it that's helpful. And then just one on on Viva.
The launch obviously coming later this year in Europe .
Any commentary on bringing the Viva lens to other markets outside of Europe , and if so do you have any commentary on what the approval pathway would be either in the U S or in China.
So we have a number of countries, where we are in regulatory review.
We expect that by the time, we have our experts meeting in Milan in September there will be a number of markets open for the Viva lens.
So we expect very good attendance in Milan unless of course, there's another COVID-19 spike, but without that we see in person ophthalmic surgeon meetings being very well attended and we expect that there will be countries approved in Asia and Europe .
That will benefit from the Viva Playbooks that we are building.
Got it that's helpful. And then just one last one.
For the guidance for 2022.
Does that include any potential revenue outside of the couple of million dollars pre Evo <unk> approval.
Or is the FDA approval not factored into our current 2022 guidance.
We have a modest amount of 2022 volume in our guidance and obviously again, we'd love to overachieve, but we are being very prudent in terms of what timing will end up being and so we're very confident.
I tell you that that we're ready so we'll give it all we have but we have a very modest amount, yes in our 2022 guidance at this time.
Perfect. Thanks, so much for taking the questions.
Youre welcome taxi.
Yeah.
Our next question is from Chris Cooley of Stephens.
Good afternoon, and thanks for taking the questions.
Karen and Patrick maybe if I could just start just on the guide just want to make sure. We're thinking about this correctly and then I've got a follow up but.
All the guidance.
Help us think a little bit about the gating on the increased spend I. Appreciate the color you provided on the kind of a return to normalcy, when we think about the topline.
And the seasonal trends there but.
Help us think about how you make these incremental spend.
Through both of them.
Both from a consumer awareness perspective, and also our clinical education perspective, just kind of how we should think about the gating of that but I've got one quick follow up.
Sure Chris This is Patrick I'll field that one.
So as Caren and we said in our prepared comments.
This is really a big year for us as we look to increase the brand awareness of Evo worldwide, especially with the pending approval that we see on the U S market being the number one market and we do believe the U S market will be able to drive a global influence for us and so that's what you're seeing in the <unk>.
That we gave around the the uptick in investment in sales and marketing the rest of the business.
R&D G&A some modest increases there as we continue to scale.
So nothing I would say really worthwhile there other than scaling to approaching $300 million plus company and starting to prepare us for what we hope to be with the U S coming onboard a very very robust growth rate over the next several years.
I appreciate that color and just just as a follow up for me. When we think about just the U S market in anticipation of FDA approval and then the subsequent commercialization here.
Hum too highly fragmented market when we think about this space versus what you have for example in China.
Can you help us think a little bit about that.
Those kind of how we should think about the rollout is this an initial focus on kols and get good traction and then expand over time or is there similar rapid.
<unk> launch post commercialization that we should think about obviously the kols going first but subsequently they are much faster.
Bush into the broader market based on training and education. Thanks, So much.
Thank you Chris so in the U S market, we definitely will have a phased rollout.
Obviously, our principal investigators those who participated in our clinical trial.
Those who have our kols and has really strong refractive lens based practices as part of their goals and we will work with all of them to make sure that we have a very outstanding business model at the same time that we provide outstanding clinical training to the surgeons and their teams and gift.
Them certified appropriately and quickly.
So it won't be identical to China, but it'll be very close to China, and I say that because the surgeon experience and the patient experience will be very similar in China and the differences is that China has very large groups as you well know, including the public company Iyer and University Hof.
But I'll say buy in larger quantities at a time, but in the U S. We're really only about 300 to 350000 or about 30% smaller than China. So it's a little more spread out but we also have very large and planners. So we're doing our work very diligently to make sure that we meet.
The market requirement and that we also face and quickly and aggressively.
Thank you.
Yeah.
Our next question is with Andrew Brachman of William Blair.
Hi, Karen Patrick Brian Good afternoon, and thanks for taking the questions.
Maybe just to start here can you, maybe just sort of level set us on where capacity is just given all of sort of the supply chain issues that you've had in the U S. And then the reason I ask is this is really just sort of to level set investors sort of on that capacity ahead of the Evo U S approval just want to make sure that we're we're calling any fears as it relates to your ability to.
Sort of satisfy that demand.
Thanks, Andrew Thanks for joining us I'm in terms of capacity, we are working diligently to triple our current capacity within the next 18 months.
And so if we look out in terms of volume as we see it and growth.
Now in the 30% plus range for units each and every of the next several years of course, even we think some years being much stronger we want to make sure that not only will we have the capacity, but that we will also have reserved inventory capability of about 30% to 40% of that.
Projected demand.
So we're in really good place, we should be opening our new Dow, Switzerland facility by the end of the year in Lake Forest, California by next year plus.
Plus we're expanding Monrovia aggressively.
That's great. Thank you for that and then maybe as it relates to the disclosure that 'twenty 'twenty. One I think you said about two thirds of lenders. We're in that 0.5 to negative 10 diopter range can you just sort of talk about sort of the migration down that curve from a surgeon perspective is there anything sort of specifically.
You're hearing that surgeons are making about the lens that surgeons are more comfortable and sort of moving down that curve and then as it relates to sort of what you're doing around that any marketing that you'd call out to sort of make sure surgeons are aware of that capability. Thank you.
Sure Andrew bottom line is the lens is approved.
For that wide range of diopter correction for a reason.
What we have worked on over the past years is to validate through clinical studies, the rationale behind that range of correction.
And you May remember I'll remind you that when we went to China. There was a real belief at the time and most of Asia by the way that we would only be in the higher diopter ranges because they have a higher correction need them for a number of the people between the ages of 21 and 40 <unk>.
And what we've found out over time is there is so much satisfaction.
With attaining visual freedom that down the diopter curve, there's tremendous interest.
And because we have some unique advantages around the lens.
Around dry eye syndrome, as well as night vision biocompatibility and so many others that social media is really rallying.
Individuals who are minus three minus four or even lower to get really excited about what visual freedom really can mean, because its even if you're a minus two and a half minus three you still need your glasses quite a bit or you're wearing contact lenses. So to truly get visual freedom for a number of these patients with the advantages.
Of our Evo lenses.
We are getting a lot of inquiries are lower down the diopter curve surgeons are very comfortable with the procedure most markets churches allow their patient assuming that everything is right obviously with regard to them the pre work by the surgeon to work out.
Everything is great and they're eligible for Evo then they can have whatever they like and we're finding that very high level of interest in and selection of Evo.
That's great. Thank you.
Thanks, Andrew.
Yeah.
Our next question is with Ryan Zimmerman of <unk>.
Hey, Karen Patrick Brian Thanks for taking the questions.
Congrats on all the progress this year, it's been very encouraging to see.
Yes, I wanted to ask about the guidance Caren four for 2022.
What do you think about that 28% growth.
I look at kind of where you're at on China, where you're out of Japan.
How do you think about the growth contributions from both China and Japan.
Relative to that 28% are they accretive are they.
Can you just help us understand kind of what you expect out of those markets.
So your guidance in 'twenty two.
So even though the base in those markets are significantly higher than the others in terms of market share as well as in China of course total net volume we still have the same aggressive growth rates that we projected a few years ago as a matter of fact.
We talked today about the fact that we're looking at 28% growth total so bottom line is.
We still expect those strong numbers in those markets.
And Ryan I think it's consistently been saying for several quarters now which.
Yeah, I'll, just say for several quarters, you've been talking about sort of these three.
Pillars or phases of growth over the next several years and as we said over the next call. It 12 months to 18 months. The primary growth drivers are non U S.
G of geographies right, but as U S. Evo comes on board it'll take US 12 months to 18 months for that product to really get up to a critical mass and that'll be the second phase of growth for us and then the third phase as we've talked about is I think we had a question on Viva earlier, but that's really as we start thinking about the presbyopic market.
Inside of that that third catalyst are down the road so.
As we said, it's you know it's fairly modest U S contribution.
But the sooner we get that approval and we're very excited to get going on it and we've got the big Crs coming up as well, which will be what we hope to be a very nice.
Hopefully a grand opening for U S Evo, Dr Packer, who is going to be.
Talking about <unk> submitted an abstract as well on the data there. So we're excited about that.
That's helpful. Thank you.
And then.
You know I can't help you called it out in the 10-K around competition, starting to emerge in Asia, and and and I'd be remiss, if I didn't ask about it and we do get that question from investors and what you know is this a concern and what can you say about it I imagine your IP is pretty strong but.
Your comments are around that Karen I think would be appreciated by investors.
Sure.
Yes, there definitely are companies that are in some phase of development or clinical study around and implantable contact lens. We are the only company with an implantable calmer lens.
So when we think about competition and we think about the biocompatibility quiet in the I am 20 years successfully in the eye a material that is far superior to cataract lens material, which has much less work to do them in a mess.
Like cover so to speak bottom line is we are aware of other competition. There are other competitors now I'm being manufactured in India and.
And Europe , and we are the only company that has this proven test of time extraordinary material that has exceptional safety record and exceptional efficacy record.
And Brian if I could let me know.
Brian I just wanted to follow up because you brought up the you brought up the 10-K as you know the 10-K is the very comprehensive document, which includes risk factors as well and so I'm clearly in our prepared comments in our press release and what we openly said, we we do address competition, but it's not something that at this point we see.
He is a headwind for us but in the 10-K document it's a very different as you know sure set of disclosures that we put in there.
No that's I appreciate that Patrick.
I was reading through it as the call is going on if I could squeeze one more in.
On the backlog and it's already been asked about but but is there any risk in your mind or does the guidance assume anything in terms of loss to the backlog. It's still stands around 20000 is our as I recall as we head into 2022.
But is there any risk that patients could.
I'll walk.
Walk away, if you will to other refractive options.
No we don't see that and as we've described it there's a couple of characteristics of the backlog one of them is as we've discussed because our demand was so strong. This is really more of a supply and on the supply side, because we cannot hit these demand numbers because they really just ran rent ran away from us.
We decided to do an allocation and so we allocated.
And really satisfied most customers except for really our largest customers sitting in China on top of that we tend to see that the backward or our our made to order or our toric lenses.
So patients there's not really another option for that and they tend to be higher diopter and so we believe this is very very sticky business and as Karen said demand continues to be very strong we are making very good headway into the backward or position, we will make strong head. We believe in Q1 and even more so into Q2 as we go into our largest.
Seasonal quarter for the year.
Okay. Thanks for answering all my questions guys I'll hop back in queue, Yes of course.
Joy scheme.
<unk>.
Our next question is from Jim Sidoti of Sidoti Company.
Yeah.
Hi, good afternoon, thanks for taking my questions.
First for me on Capex, I think you said $20 million for the year, which is.
Oh.
Considerably from 'twenty to 'twenty, one what is the what is that on is that most of the equipment.
<unk> can you give us some color on that.
Yeah sure Jim It's Patrick So as Caren said, we're looking we got the question, though to triple our capacity, we did about $40 million in Capex. The high majority was related to manufacturing expansion, the approximately $20 million that I called out in our prepared comments.
Primarily the high majority of manufacturing expansion, so that tripling of the capacity, you'll see eat out, Switzerland coming online late for its coming online even more our monrovia facility expanding out even further we talked about that in our prelim announcement, where we doubled our square footage footprint. There. So all good things and we're in.
Very good shape as we approach U S Evo approval and continued market penetration of our products worldwide.
And then can you also talk a little bit more about the tax rate wise and jumping up to 30% next year.
No a little bit of cushion maybe you know if we can.
Bring that down a little bit, but there's some moving parts with that.
And as well one of the Wildcards is our profitability by entity and with U S. Evo coming on board that'll be a U S tax rate and Thats, a higher tax rate than our products are being shipped out of Switzerland, right, now, which already a far less tax rate. So it's really just more of a geography mix related to the tax structure of the various cut.
In this case U S versus our Swiss tax structure.
Got it thank you.
Youre welcome.
Our next question is from Steven Lichtman of Oppenheimer.
Hey, guys. This is.
David overseas.
Maybe another question on the <unk> guide does that assume any continuation of the COVID-19 impacts seen during the fourth quarter related to supply disruptions and absenteeism.
And any thoughts on when these headwinds should abate.
Yeah, No I think in the prepared comments Karen talked about the fact that we've had a very strong seven weeks now to the beginning of the quarter.
And so in my prepared comments I talked about revenue.
Would be similar to slightly up from the $59 million that we just reported for Q4 2021. So we've tried to take into considerations of potential headwinds related to COVID-19 as we came into the 2022, but at this point things seem to be clearing up which I know everyone is keenly keeping their eyes on them. So we can.
Very good about where the business is that so are we expect to close the quarter strong and we expect to have.
A very hopefully record breaking once again Q2 for us and we gave a lot of color around.
The second half revenue.
The company will as well be very very robust for us.
Okay great.
A follow up on.
How does the data.
U S approval could you provide any latest update on your U S commercial niche initiatives, including the ICL experience okay. Thanks.
So we continue to.
Work on the Finalization.
Of the planning as well as the construction of the experience center.
We still expected to open in mid summer.
So we're very excited about what training our opportunities and experiences we can provide for surgeons and their staffs in terms of how to build a really terrific clinical model as well as having some really strong marketing support.
As well as the appropriateness of the clinical work, so with all of that being visible and experience, we expect that to be a very strong addition to.
Two what we are doing today partnering with surgeons in their shops.
So we're really looking forward to that in terms of other marketing them everything that we would do for Evo will talk about them in detail them in the future calls.
Okay, great. Thank you.
Yeah.
Okay.
Our next question is from Bruce Jackson of Benchmark company.
Yes.
Hi, good afternoon, thanks for taking my questions.
About the manufacturing expansion can you just remind us about the the FDA requirements for.
For these expansions do.
All of them require inspections before you can start.
Shipping product or.
Is it a yeah administrative type of.
Process that you have to go through some of the facilities since you already manufactured there.
So we have a regular regulatory required inspection timeframe. Some of them are scheduled and some of them are not.
Assuming that we stay within our current processes as to PS.
That it is more about informing rather than requiring inspection that that's always up to the regulatory bodies to determine.
Yes.
Okay. That's helpful and then a follow up question on the <unk>.
B O T. A lens in Europe . So you just spent a year I'm talking to doctors and getting a better feel for the procedure and the patient selection and making sure that everything smoothly.
How does that affect the anticipated rollout or is this something where.
You can train the physicians very carefully and it's going to be sort of like a a very slow steady rollout versus something where you've got the process.
Nailed down to the point, where you can maybe rolled it out a little bit faster.
Yeah.
Well our intention all along with surgeons would be the best at using the product and its early rollout which is occurring now.
They would be able to some of them, especially expertly and determine the best patient selection criteria and patient management criteria as well as post implant follow up Andrew.
And so this has always been about surgeons training surgeons that playbook will be built by them and it will also be on the podium as well as available in print from the surgeons that are experts meeting our expectation is is that they will be panels associated with those.
Surgeons, those who have questions, obviously I'm very much so I'm involved in building what the questions will be that the surgeons, who views the lenses will field, but there will also be a lot of advice and a lot of training. So in terms of what the pace will be.
The post.
The can you know the completion of this process when we say full commercialization, we mean the lenses will be available.
To each market as we are sure we can achieve the appropriate training time frame and certification and then followed by making sure that we have a very good lead time on the lenses.
So my expectation is that this time frame that we're using is going to be very effective to make the rollout much smoother much easier and potentially faster in terms of getting lenses into the hands of surgeons globally.
Yeah.
Yeah.
Okay.
That's great. Thank you very much for taking my questions and congratulations on the progress.
Thank you very much thanks Bruce.
Okay.
Yeah.
That concludes our Q&A session. So I would now like to pass the conference back to Karen for any closing remarks.
So thank you everyone for your participation on our call today.
We do look forward to speaking with many of you in the days and weeks ahead. We appreciate your interest and investment in STAAR. Please take good care all the best to all of you. Thank you.
Yeah.
That concludes our conference call. Thank you for your participation you may now disconnect your line.
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