MiMedx Group Inc MDXG announced a strategic realignment to focus its resources on its Wound & Surgical business, driving profitability and enhancing cash flow generation.
As part of this realignment, the company is suspending all activities associated with its Knee Osteoarthritis (KOA) program and disbanding its Regenerative Medicine business unit, effective immediately.
The company in Q1 FY23 generated $70.63 million from the Wound & Surgical business unit.
It expects one-time wind-down expenses to be approximately $5 million. On a pro forma basis, assuming the realignment had occurred on January 1, 2023, the company would have added approximately $25 million of Adjusted EBITDA for FY23.
"Suffice it to say, this change will materially improve our operating margins and free cash flow generation, providing much greater growth financing optionality," said Joseph Capper, MiMedx CEO.
"Since the second quarter is still ongoing, we will not comment on operating results until our next earnings release in early August. However, given our progress to date, we are raising our outlook for the full year 2023 net sales percentage growth from the low-double digits to the mid-teens," he added.
Price Action: MDXG shares are up 4.79% premarket at $6.13 on the last check Wednesday.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
