MiMedx (MDXG) Q2 FY26 earnings call: guidance and Q&A

What makes the Sonera acquisition the right deal, specifically regarding Accelerate Rx, BioSurge, and Osteq, and their synergies/overlap with MiMedx's business?

Joe Capper first highlighted MiMedx's strong standalone Q2 performance, including 15% surgical growth and significant sequential wound care volume growth. Regarding Sonera, he emphasized that the acquisition accelerates MiMedx's surgical expansion plan. He noted Accelerate Rx's market penetration, BioSurge's potential for expansion into wound care centers, and excitement for Osteq, a bone bioadhesive in development. He also stressed the critical importance of cultural alignment between the two teams.

“Yes, this is a deal that makes a ton of sense for us. You've heard us talk about the importance of expanding our surgical portfolio on every one of these calls. ... This just accelerates that plan.”

asked by Chase Knickerbocker · answered by Joseph Capper

Has the positive momentum continued through July, and what is the mix of the wound business across HOPD, wound care centers, and other sites of service?

Joe Capper stated that all wound care growth is coming from HOPD, but the company does not break down results by specific sites of service. He declined to comment directly on July's performance as the month was not over, but affirmed that the company continues to see "good momentum across our business."

“HOPD is where all the growth is coming from. We're not seeing any sequentious growth anywhere else. ... As far as July, since it's not over, I'm not going to comment on it. But suffice it to say, we continue to see good momentum in our business.”

asked by Chase Knickerbocker · answered by Joseph Capper

Given Sonera's 4,000 contracted accounts (1,500 active), how much overlap exists with MiMedx's relationships and sales force, and where are the expansion synergies?

Joe Capper indicated it was too early to provide such specific details, as the deal had just been signed. He stated that the companies would work together over the next few months to develop a comprehensive integration plan that addresses overlaps and potential gaps.

“Hey Frank, way too early to talk about that level of specificity. We just signed this deal today. We will work very closely with the Sonata team over the next few months to develop a well thought out integration plan...”

asked by Frank Tickman · answered by Joseph Capper

Where will the expected $20 million in synergies from the Sonera acquisition primarily come from, considering the different product types (placental vs. collagen/synthetic)?

Doug Rice explained that over half of the $20 million in synergies would be derived from G&A, with the remaining portion spread across other typical areas of public-to-public acquisition synergies.

“I think the way we look at it is the synergies are going to be derived from your typical public to public acquisition. So we'll get more than half of the $20 million from GNA, and the rest of it will be spread around.”

asked by David Turkley · answered by Douglas Rice

Was the comment about "strong profitability post-close" referring specifically to EBITDA, or does it also imply bottom-line net income?

Doug Rice clarified that while EBITDA is the primary initial focus, they anticipate a "really healthy financial profile" across all financial measures. He noted that Sonera's strong flow-through combined with expected synergies would lead to profitability throughout the P&L, making the deal immediately accretive.

“Well, we look at the whole gamut of financial measures, but primarily EBITDA is our focus initially. And we'll exit the year, you know, on a positive note from an organic perspective. And Sonara already has a strong track record of healthy flow through on their side, coupled with the same. synergies that we expect. We expect a really healthy financial profile after the combination.”

asked by David Turkley · answered by Douglas Rice

What is the estimated number of shares outstanding in 2027, considering the stock component of the Sonera acquisition?

Doug Rice stated that current shares outstanding are roughly 150 million, and they will issue just over 4 million new shares for the acquisition. Joe Capper added that MiMedx bought back approximately 3.5 million shares in Q2, resulting in a net increase to the float of about 700,000 shares since the buyback program began.

“ALL IN, DAVE, WE'RE AT ROUGHLY 150 MILLION SHARES TODAY AND WE'RE GOING TO ISSUE JUST OVER 4 MILLION NEW SHARES, IF THAT GIVES YOU AN IDEA ABOUT TOTAL GOING FORWARD.”

asked by David Turkley · answered by Douglas Rice

Given Sonera's attractive business with over $100 million in revenue and high gross margins, why is it the right time for them to sell to MiMedx?

Joe Capper declined to speak on behalf of Sonera's motivations. He noted that Sonera remains bullish on its business, possesses a robust product portfolio and pipeline, and has experienced strong growth. He suggested that Sonera would be best positioned to answer why the timing was right for them.

“Brad, I'm not going to speak for them. I will tell you that they are still incredibly bullish on their business. They have a robust product. portfolio. They have more products in the pipeline. They've been resourcing the business. They streamlined it a bit last year. They saw nice growth last year, nice growth into this year. So you would have to ask them why this made sense for them to do it and why this was the right time.”

asked by Bradley Bowers · answered by Joseph Capper