LeMaitre Vascular Inc (LMAT) 2019 Q3 法說會逐字稿

Welcome to the LeMaitre Vascular's Q3 2019 Financial Results Conference Call. As a reminder, today's call is being recorded. At this time, I would like to turn the call over to Mr. JJ Pellegrino, Chief Financial Officer of LeMaitre Vascular. Please go ahead, sir.

Thank you, Catherine. Good afternoon, and thank you for joining us on our Q3 2019 conference call. With me on today's call are our Chairman and CEO, George LeMaitre; and our President, Dave Roberts.

Before we begin, I'll read our Safe Harbor statement. Today, we will make some forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, the accuracy of which is subject to risks and uncertainties. Wherever possible, we will try to identify those forward-looking statements by using words such as believe, expect, anticipate, forecast and similar expressions.

Our forward-looking statements are based on our estimates and assumptions as of today, October 23, 2019, and should not be relied upon as representing our estimates or views on any subsequent date. Please refer to the cautionary statement regarding forward-looking information and the risk factors in our most recent 10-K and subsequent SEC filings, including disclosure of the factors that could cause results to differ materially from those expressed or implied.

During this call, we will discuss non-GAAP financial measures, which include organic sales growth numbers as well as operating income growth expectations, excluding certain onetime gains and charges. A reconciliation of GAAP to non-GAAP measures discussed in this call is contained in the associated press release and is available in the Investor Relations section of our website, www.lemaitre.com.

I'll now turn the call over to George LeMaitre.

Thanks, JJ.

In Q3, we posted sales of $29.1 million, up 20%. Embolectomy catheters, valvulotomes and allografts led dollar growth. The Americas had a record quarter, up 18%, while Europe grew 20% and Asia Pac 43%. Based on these results as well as the recent CardioCel patch acquisition, we've increased our 2019 sales guidance to $117.6 million, up from $116.1 million on the last call.

Our biologics category accounted for 35% of revenues in Q3. Allografts grew 48%, and we've solved our tissue supply problem. Omniflow grew 18% in Q3, while XenoSure grew 5% organically. In Q2, we launched XenoSure Plus, a thicker patch. And in Q3, we launched DuraSure, a patch for neuro and spinal procedures.

You've heard a lot about our rep surge as we continue to globalize our channel. In October, we also opened up an office/warehouse in the English town of Hereford. We did this in response to Brexit uncertainty, but perhaps more importantly, planting our flag in England should deepen our connection with British vascular surgeons and hospitals. We now have 11 sales offices: 4 in the Europe and the U.K.; 4 in Asia Pac; and 3 in North America. 7 of these offices also include product warehouses.

2019 is shaping up to be a productive year. Through September, sales have grown 13%, and adjusted op income has grown 8%. In the last 13 months, we've completed 4 acquisitions using our cash reserves to build a better income statement.

With that, I'll turn the call over to Dave.

Thanks, George.

On October 11, we acquired the biologic patch business of Admedus for $15.5 million plus potential earn-out payments of $7.8 million. Annualized sales were $7.1 million. The acquired devices, CardioCel and VascuCel, offered 2 important features, anti-calcification and decellularization, and serve as the next-generation alternative to LeMaitre's largest product line, XenoSure.

In addition, CardioCel is well suited for pediatric cardiac surgery, a niche where we believe we can succeed. Sales are mostly in the U.S. and Europe, and we'll expand critical mass in a number of our markets including the U.K. and Singapore. Gross margin of the CardioCel and VascuCel products in the sellers' hands were approximately 70%, although during the 1 to 3 years it will take for us to relocate production to Burlington, margins will be challenged. In 2020, we expect sales from these products to be between $6 million and $6.5 million, the gross margin to be 40% to 50%, and we expect the transaction to be accretive to op income. At a high level, this acquisition brings us a new technology platform that expands our expertise in biologic implants and puts a differentiated product into the hands of our growing sales force.

With that, I'll turn the call over to JJ.

Thanks, Dave.

Our Q3 2019 gross margin was 69.3%, down 2.1% versus the prior year period. The decline was driven by the 2018 acquisitions and strong U.S. dollars. Going forward, the recently acquired CardioCel and VascuCel product lines will carry a lower gross margin as we sell inventory purchase under the transition services agreement. This margin will improve when we relocate to Burlington. Over the coming months, the margins of Omniflow, Syntel and Python will improve as we complete their product transfers.

In Q3 2019, operating income was $5.9 million, up 28% from Q3 2018. The operating margin in the quarter was 20%. In Q4, we expect operating income to increase 5% over the prior year adjusted for special items and 9% excluding the effects of CardioCel. More specifically, in Q4 2019, we anticipate that CardioCel will generate approximately $700,000 in revenues and be dilutive to operating income by approximately $200,000. We ended Q3 with $44.9 million in cash, a decrease of $3.3 million during the quarter. The decrease was driven by acquisition-related payments of $6.8 million, working capital uses of $3.1 million and dividends of $1.7 million, which were largely offset by a record adjusted net income. EBITDA in Q3 was $7 million, up 27% over the prior year. Separately, our Board of Directors approved an $0.085 dividend implying a yield of 0.9%. Our Q4 2019 sales guidance of $30.1 million to $30.9 million represents a year-over-year increase at the midpoint of 8% on a reported basis and 4% organically. We also expect Q4 2019 operating income of $5.6 million to $6.1 million, an increase of 5% at the midpoint excluding special items. We have increased our full year sales guidance to $117.2 million to $118 million, representing a year-over-year increase at the midpoint of 11% on a reported basis and 7% organically. We also expect full year operating income to be $21.9 million to $22.4 million, an increase of 7% excluding onetime items.

With that, I'll turn it over to the operator for questions.

(Operator Instructions) Our first question comes from Jim Sidoti with Sidoti & Company.

Can you hear me?

Yes. Quite well.

Great. Great. So just want to go over the acquisitions, a little bit, you said about $6 million and $6.5 million of revenue. Now is that to the existing customer base? Or is that to your customers?

So, Jim, this is Dave. The $6 million to $6.5 million revenue that we cited as far as 2020 for Admedus, some percentage, a small percentage is to LeMaitre's current customer base. I would say most of the revenue is going to hospitals and specifically for cardiac surgery procedures and a good portion of that is actually pediatric cardiac surgery procedures.

Okay. So that's a new base for you. Do you think you'll be able to sell any of your existing products into those markets?

So I think the potential for cross selling, specifically in pediatric cardiac surgery is a little bit lower, and that we do have 1 or 2 or 3 of our 15 product lines, perhaps could be sold there, into adult cardiac surgery, a few more. I think that there's no question that there is more cross-selling opportunities for products used by vascular surgeons. Of course, some small percentage of the sales of CardioCel and VascuCel, specifically VascuCel are to vascular surgeons. And that was an important part of this transaction. Another important part clearly was we like the biologic space. And this does give us a nice next-generation technology in that space. As you know, we were working on a 2.0 version of XenoSure, and this product line fits that bill in many respects. But to answer your question, I'd say fewer cross-selling opportunities with respect to CardioCel than there would be in products used by vascular surgeons.

Okay. And then the last question on the deal. Have you been able to retain most of their existing distribution and salespeople?

So they are just -- they had a hybrid distribution channel. And with respect to the distributors and agents, we are transitioning them now. Of course, there's a decent amount of inventory in the channel and they have transition periods built into their contracts. So that transition will take place over the coming few months. With respect to their direct sales channel, we are interviewing and expect to hire a handful of their sales -- direct sales people. That process is ongoing right now. So we will bring some of their sales people into the LeMaitre.

Okay. All right. And then JJ, in the quarter that ended in September, a couple of questions. Inventory is up -- it looks like about $4 million. What's going on there?

So inventory is up related to -- the acquisition, the Tru-Incise acquisition of a few weeks ago. We're also doing the relocation of our applied product line that we acquired a year ago here to Burlington. So we bought extra inventory there. And then we're selling more allografts RestoreFlow, as you know. And we're building up and ramping up on inventory there as we fix that supply issue with the tissue banks. So those 3 topics really increase the inventory.

All right, I guess -- I thought that deal closed after the quarter when it was over.

Yes. There was a -- not this -- not the CardioCel and VascuCel deal, Jim. Before that, there was a Tru-Incise Valvulotome acquisition.

It was July 12, Jim.

And that came with a million something of inventory.

Okay. Sorry. And that can mean that goodwill went up because of that as well?

Yes. Yes. So that was about $8 million purchase price and some decent chunk of that goes to goodwill.

Got it. Okay. And then the last question is the tax rate in the quarter seems a little low. Is that a one-time thing? Or do you think if you will stay around this on that level?

So I think we have talked about it before, sort of our normal tax rate from ops is around 26%. But when we get a decent amount of stock option exercises, that brings it down. So we had a decent amount of stock option exercises in the quarter.

(Operator Instructions) Our next question comes from Rick Wise with Stifel.

It's Drew Ranieri on for Rick tonight. I just wanted to also start on the acquisition as well. And Dave, you mentioned that you're expecting to hire some of their direct sales people. So this is kind of out of the typical LeMaitre acquisition strategy. You normally just drop the product in your existing salesforce's bag. So could you maybe talk a little bit more about that in detail? Are these specific reps? Are they just going to be selling the -- to the pediatric cardiac surgeon? Or do you think he will have the full LeMaitre portfolio at their disposal? And just to toss on another question. You have 109 reps at the end of this quarter. How should we be thinking about your salesforce going forward over the next 12 to 24 months? And is this kind of acquired rep surge going to be -- is that actually embedded in your OpEx guidance right now?

Okay. So let me take the first question first. There are -- I said a handful. I'd say 5 or 6 or 7 selling and marketing individuals that we're interviewing. One is in Europe, a handful are in the United States and a few are in Asia PAC. A couple of these individuals, I would say, would take on more of a -- one is a marketing person. So that person would be focused specifically on these product lines. Another one could become a, what I would call, more of a product specialist who would cover Europe as a whole. But some of the sales reps that we're interviewing would start carrying the entire LeMaitre bag, they would just have a specific expertise in this product line that hopefully we could leverage, and it could benefit our entire selling organization where CardioCel and VascuCel is approved. In terms of how does -- and you're right to point out, Drew, that this isn't out of our normal playbook. Normally, when we do acquisitions, we don't hire sales reps from the target company. But again because these products are used in a couple of areas, cardiac and pediatric cardiac surgery where we have less expertise, we felt like it would be good if we could hire some of these folks in. In terms of your second question. How does this fit into the LeMaitre -- to the sales rep headcount, in terms of the end of this year, I think that excluding the reps that we take on from this acquisition, we are at a 109 now. We'll probably be up 1 or 3 reps by the end of the year. Of course, then you -- we have to add on whichever reps we decide to hire from this acquisition. And beyond that I think, as you know because operating profits feed first at LeMaitre, the number of reps we hire -- we're sort of a pay-as-you-go basis. So I think as you think about next year and the year beyond, we're not going to talk about very specifically. You can think of us as during sort of more of the same pay-as-you-go with respect to expanding the sales force.

Got it. And then just touching on gross margins for a moment. So you have -- Cardial is basically lapping as we speak on the call right now. You have applied medical that lapped earlier this year, and you'll have Admedus for next year. But can you maybe just walk us through the gross margin impacts for 2020 at a high level given some of these past acquisitions and LeMaitre being the gross margin repair shop?

Yes. So obviously we're not guiding on that, but I would just say conceptually. You've got the Omniflow transition that's happening, bringing the Omniflow products from Australia to Burlington, and you've got the applied transition that's happening, manufacturing those devices in-house. Those should be done sort of around the first of the year or so, and then you got to work through your old inventory and start selling the stuff that hopefully you are making less expensively here. That'll help. But yes, as you acquire Admedus, CardioCel and VascuCel products, I would say, that's kind of similar to the 2 deals we did in the second half of last year about $6 million, $7 million of revenue at a sort of 40% to 50% margin for some period of time, while we buy those devices from the seller. And so those 2, if you recall, had about a 1.5% negative impact on the margin. And so you'll have that as you look forward to sort of into next year. And then on top of that, I guess I would say, there may be some purchase price accounting going away from the recent acquisition of a few weeks ago. And that'll help you as well. And then FX, who knows, goes up and down to change margin. So the Tru-Incise margin is already at a decent level. That's an acquisition from a few weeks ago or month or 2 ago. And then when that purchase price accounting goes away, the inventory writeup, it'll be even stronger. And there might be some pricing opportunities as well along the way. So there are a lot of puts and takes. It's a complicated topic, but at high-level I guess I would say, the acquisitions are bringing it down 1.5% for the 2% from last year, 1.5% for the most recent one. Maybe helped from Tru-Incise as it rolls out a purchase price accounting and help from the 2 integrations that are happening.

And our next question comes from Jason Mills with Canaccord Genuity.

This is actually Cecilia on for Jason tonight. I wanted to ask about XenoSure, specifically the new product launches in the quarter. And then just longer-term, as you think about the acquisition of CardioCel and VascuCel, how you see XenoSure sales impacted by those 2 products?

Cecilia, nice to talk to you. It's George. So the launches, I would say, they really just came out of the gate. And I would say, in general, they are a little bit slow, but I'm not worried at all. It takes a long time with some of these things. Again to remind people, the XenoSure Plus is sort of a fat one and the XenoSure dura or the DuraSure has got different indications. So we'll see how those go. Those seem like excellent shots on goal and also sort of a regulatory reminder. We launched in Australia last October. That's going exceptionally well, and the clinical trial in China is almost fully enrolled. It's at 282 out of 288, although, we've extended to 315 because of loss of follow-up to some of the patients. So we're getting there in China. And in fact, I think we're done with the cardio side right now. Or we're almost done with the cardio side. And the vascular side is lagging a little bit. So we'll have to choose. If we do decide to go ahead and file right now with cardio and then wait on vascular. So that's a -- I know you didn't ask for that. That's the regulatory side of the device. As far as a VascuCel and CardioCel, how do they relate to XenoSure? Generally speaking, higher price points here. I think the cardiac price points are around $1,000, and the XenoSure price points are more like $200 a piece, the small patch peripheral thing. So you're getting a much higher priced product. I think Dave alluded to this, but I think it's important to reiterate here, which is, we already had on a drawing board, and we're halfway there on making XenoSure 2.0. And notably, that product carries the features anti-calcification, decellularization and no rinse. Well, here we go, Dave just bought a company that has those features, plus he bought a book of business that we think will be worth about 6%, 6.5% of sales next year. So in some ways, this acquisition is an acceleration of the XenoSure 2.0, and it's a much more real tangible one because it's done. It's got all the approvals we need. It's got a pretty broad-based approvals set, places like Singapore, special approval in Australia, does not have China and Japan notably. And of course, it has the Europe and the U.S. There's a couple of more candidates in there as well. So a really cool maneuver or move by LeMaitre to continue to get stronger in the biologic patch business.

And Cecilia, I might just add a couple of points. One, with respect to the peripheral vascular patches where the pricing is somewhat similar. Obviously, we've had some headwinds with respect to XenoSure growth over several quarters, and part of that is caused by these next-generation patches becoming available for peripheral vascular surgeons, and us not having an answer to that. So now we do, and I don't necessarily think it'll compete so much against XenoSure. I think it'll compete against some of those entrants that was -- that were taking business from XenoSure. That's my first point. And as George alluded on the larger patch side where our sales of XenoSure are much smaller. The surgeons purchasing CardioCel really value these traits of anti-calcification, decellularization, no rinse. And they're willing to pay up for it. So the CardioCel patch -- a normal CardioCel patch sells for about 3x the price of a XenoSure patch. So to the extent that in the future some of the XenoSure large patches converted over to CardioCel, that could actually be good for us.

Okay. Thank you for all the color on that. And I guess just sticking with recent acquisitions as well, could you provide some commentary just around how Applied Medical as well as Cardinal trended in the quarter? And then just your expectations and thoughts as you look to 2020 for the potential of those 2 product lines?

Sure. So this is Dave again. With respect to how they have done in the quarter. I would say both of those acquisitions, those were the 2 acquisitions that we just anniversaried now from last fall. They're both running about 20% to -- 25% to 30% ahead of the year one expectations. And they're both accretive this year. And so they're doing really well. As JJ was mentioning, the applied medical acquisition, the relocation of that production process should be complete by the end of the year. And then frankly, I think our general rule of thumb here is, as we anniversary these acquisitions, the sales sort of become part of LeMaitre sales overall. So I'm not sure -- we don't really guide on particular product lines into the future. And just setting expectations for future calls. I'm not sure if we'll be calling those out. But as they become part of the overall LeMaitre sales bag and base of revenue, I think everyone can feel good that they're running ahead of expectations, and they're contributing to our bottom line.

And our next question comes from Joe Munda with First Analysis.

Can you hear me okay?

We can, Joe.

Real quick. Can you give some sense of what the rev split looks look for CardioCel and VascuCel?

So -- sorry, did you say the revenue split?

Yes. The sales split?

Predominantly, I'd say 80% to 90% CardioCel, and then roughly 10 percent-ish or so VascuCel, something in that area.

So Dave, I guess the question, I know you touched on it a little bit, but I guess how do you -- what are the plans as far as commercializing VascuCel in light of having XenoSure in the market. Yes, the price points are different, I know it's still de minimis as far as revenue is concerned. But I guess, could you give us some idea of how those 2 products coexist or are complementary to each other? You talked about XenoSure 2.0. I guess do you do away with VascuCel and turn that into XenoSure 2.0, I'm just curious?

So, just so I make sure I heard your question right? How do we plan to sell a small XenoSure patch against the VascuCel patch, generally?

Yes. Exactly.

Okay. So, right. Obviously, we have been very successful with XenoSure. Most of the XenoSure business that we've built has been the smaller sized patches used in peripheral vascular surgery. Over the last couple of years as we've seen competitors enter the market, of course, one's VascuCel, another's one you're familiar with PhotoFix from CryoLife, Duravess from Edwards, et cetera. Some of these products are, what I would call, next-generation products that have this decellularization, anti-calcification, no rinse features, one or a combination of those, XenoSure didn't. And so we felt like it was a very nice add to the bag so that when a vascular surgeon said, yes, I like a biologic patch, but I want a patch that has an anti-calcification or decellularized patch. We didn't have anything to offer them until now. And now we do. So really it's a little bit like when a vascular surgeon wants is a embolectomy catheter, and some latex and some like latex-free. Well, we offer both of those. And there are other examples in our bag. So I think they will exist symbiotically next to one another in the bag, and if one of our sales reps encounters an objection to XenoSure that it doesn't have an anti-calcification treatment. Now we have a solution for that.

And our next question comes from Mike Petusky with Barrington Research.

A few questions. I didn't catch if you said what was valvulotome's in terms of percentage up or down for the quarter?

We didn't say, but I think it was 10% organic growth in Q3.

18% reported.

Okay. And then George, I was just wondering in terms of the China market, I know it's the sales effort there has been sort of convoluted, and you're working to gain traction, but I saw that obviously, Asia PAC was strong. And I was just curious that you guys are starting to get some things done there? And can you just give us an update generally in China on your marketing efforts?

Sure. Mike, of course you picked on the one country here. So I have a note here that says we had growth in 19 of 22 countries. And you picked on the one. Well, we do have actual reported growth of 60%. It's sort of a fakey because they had a $120,000 return last year. So I would say -- so I think things are going great with this company. We just had a 20% quarter, which we don't always have those. But you picked at one place where I would say, our China efforts are bogged down. I really wouldn't blame Trump or Xi, and I would just say it's real hard to get approvals in China. We only have 25% of our products approved over there. And we're slogging it out in this clinical trial. Although, maybe, we'll get that approved in 2021 or 2022, and it'll make us sort of have 50% of our revenues approved. The China trial is about XenoSure just to remind everyone. So no real break in the clouds yet in China. Thanks for pointing out that. We think we just appreciate that.

Sorry. Should have asked that one off-line. JJ, in terms of the tax rate. I'm just looking back at the model. It looks like the last couple of years you guys have actually for the full year have come in when all was said and done sub 20%. I mean is it possible that, that's how we end up for fiscal '19?

Yes. And I think we're in -- vectoring in around the low 20s for the year. And it really depends on who exercises options in Q4. We had a decent amount in Q3 obviously with that 12% rate. So we'll see what happens in Q4, Mike. So it's a little tough to predict, but I think that's kind of the high-level answer.

Okay. And then do you by any chance have handy the stock based comp and Capex for the quarter?

We do. [7] [10] for the CapEx and stock-based comp around $700,000.

Okay. And then just last question. We'll make Dave earn his money tonight. Is there any need -- I know from a balance sheet perspective, you guys still have the ability to go out and do things. But just from the standpoint of integration and the work that you guys will need to do to sort of bring Admedus just sort of bring it into the fold. I mean do you guys have to take a breather in terms of M&A or is there something that you guys have been working on? I mean, could you go close it?

I'm only going to make this analogy because we're nearing Thanksgiving. But it feels like we just left the table at Thanksgiving and football's on the TV. And we're not really too hungry, but then when your mother walks with pumpkin pie, and you just can't resist it, you eat it. And so I would say, yes, we are very busy with integration around here. But you have some -- there are some acquisition targets out there where no matter how full we are, we would jump on them. So I guess that's how I look at it.

And our next question comes from Brooks O'Neil with Lake Street capital.

Congratulations on a terrific third quarter. So I'm hoping -- when I looked at the third quarter, and I saw that the terrific numbers, I kind of thought, okay, probably they are out of the woods, and the growth rate is picking up, and everything is fabulous. And then I kind of looked at the fourth quarter guidance, and I went, well, maybe not. So a, what's going on in the fourth quarter? And how would you characterize kind of where you're at in terms of getting past this growth slowdown and getting back onto a more normal LeMaitre track?

Yes. So I don't know -- I would call that a fairly bearish preposition, Brooks. I guess I would say a couple of things. One is if you remember last year Q3 was pretty slow and we had a few reasons for that. All of these reasons have turned around really sharply since then in a good way. And then Q4 last year had a nice rebound quarter. So really if you wanted to blend the 2 of them together and look at H2 of last year with H2 of this year. You're sort of at an 8.5% organic growth rate this year versus last year. So even though you're seeing 4% in the quarter, tough comp in Q4, you're seeing 13% in Q3, easier comp in Q3. Blend them, get the 8.5%. I think that's generally on the higher end of who we said we are sort of 7% to 8.5% organic growth guide. So that feels like a good number to me. There was another topic in there, which was there was a large OEM order that we probably thought was going to be split a little bit between Q3 and Q4. And it wound up being pretty much all in Q3. So I put a little bit more growth in Q3 versus Q4. So I would say if you think about those 2 things. I think you're pretty much on track for a nice growth rate, and you're at 7%, 8% for the year in terms of organic growth which is a pretty nice answer versus last year's organic growth rate. So I would say, no, yes, the growth rate. If you look at it sequentially by quarter too, I think you would get some nice answers too. I think it has been a nice story over the last three or four quarters in terms of growth.

That's good. I'm just curious. I think I remember, but I might be wrong that was 10% growth historically, but maybe that just includes the acquisitions. It wasn't always 10% organic. So that was...

Exactly. There was. Yes, yes. We're that -- we're sort of the 7%, or 8% organic guys and then another 2% or 4% per acquisition historically. That's where you've been.

Brooks, another way to look at it -- this is George. If you want to do in 2018, we grew reported sales 5% and the op income number was down 2% if you say, oh, you don't count all those free gains that we made from that big acquisition. So there was 5% and a negative 2% in 2018. And I do think there a nice rebound story there which is this year it's an 11% and a 7%. And so 5% and negative 2% versus 11% and 7%. I think any reasonable guy would say that's a pretty good rebound year-to-year. that's full '18 versus four '19.

Right. No, I think that's a great rebound. And I know you are not providing guidance for 2020, but do you think -- I mean basically I guess my question was do you think you're out of the woods here and you're back on the normal track? Or do you think it's more lumpy in the future like it's been over the last couple of years?

Well, there's a lot in that question. I feel like our guidance goes out through Q4, and you're seeing a full year. If you want to look at the world as 1 year lumps, I think this is a pretty solid year, 11% reported growth and 7% op income growth. And beyond that, the reason we took away that 10%, 20% was because we felt like it just got distracting, and we didn't want to go that far in the future. So we're not going that anymore and that's what you're left with. At the end of a year now, you just have -- right now you only have a quarter's worth of guidance. But we played that before. It didn't seem too helpful in the past.

And we have a follow-up from Rick Wise with Stifel.

It's Drew again, just a couple of follow-up questions. Just on RestoreFlow, I think you gave the growth rate at 46%, but just double checking some math as it's kind of in the ballpark to say that it's around $3 million, $3.1 million, $3.2 million for this quarter in revenue?

And we're happy to tell you. It was a -- I think it was a 50% reported growth rate. 50% exactly.

48%.

So 48%, yes, 48%, exactly.

For the quarter it was about $2 million, $2.3 million -- $2.5 million of revenue.

Okay. And then sorry if I missed this. Did you give price and volume in the quarter?

We didn't but we can. I think the volume units were up 38% if I'm doing this right, Dave.

RestoreFlow and price was up -- You're talking about just RestoreFlow?

For both if you have it. For RestoreFlow and for the total company?

Right. So RestoreFlow was up 38% in units and it was up 10% in price. And for the whole company 5% price, 8% units.

Okay, great. And then just one last one. For the Tru-Incise acquisition. Can just remind us what the revenue and gross margin were for it in the quarter? And lastly, kind of what you expect maybe going forward?

So the revenue in Q4 was around $300,000. And the revenue -- the hospital level revenue generally reached around $2.2 million at the hospital level. The gross margin was around 60% in the quarter, and we expect that to increase over time as we get rid of -- we move past the purchase accounting and are selling inventory that we built here ourselves.

Ladies and gentlemen, that concludes today's conference. I would like to thank you for your participation, and you may all disconnect. Everyone, have a great day.