8-K: STAAR Surgical Celebrates Milestone of Three Million ICL Sales, Eyes Continued Growth

STAAR Surgical announces the sale of over three million Implantable Collamer Lenses (ICLs) globally, marking a significant milestone in their vision correction technology.

Summary

• STAAR Surgical has announced that it has sold over three million ICLs globally.
• The company's EVO ICL product line accounts for approximately 2.5 million of the total ICLs sold.
• STAAR expects to sell more ICLs in the next three years (2024-2026) than in the first 25 years of ICL sales combined.
• The company is targeting net sales of $500 to $550 million and operating income of $60 to $90 million by fiscal year 2026.
• STAAR's 2023 net sales were $322.4 million, with 18% ICL sales growth and 19% ICL unit growth.
• The company's 2023 adjusted EBITDA was $56.7 million, and adjusted EBITDA per diluted share was $1.15.
• The company is projecting 2024 net sales of $335 to $340 million, adjusted EBITDA of approximately $36 million, and adjusted EBITDA per diluted share of approximately $0.70.
• STAAR estimates that EVO ICL represents approximately 15% of the global refractive procedure market in 2023.
• The company is focusing on increasing surgeon confidence in eye measurement and lens size selection, expanding sales of EVO ICL for -6D to -8D myopia, and new product innovation.

Sentiment

Score: 7

Explanation: The document highlights significant achievements, such as the three million ICL sales milestone and strong historical growth. However, the lower 2024 adjusted EBITDA outlook and macroeconomic headwinds temper the overall positive sentiment.

Positives

• STAAR has achieved a significant milestone with three million ICLs sold globally.
• The company has experienced strong sales growth in 2023, with an 18% increase in ICL sales and a 19% increase in ICL unit sales.
• STAAR's cash-generative business model and strong balance sheet provide flexibility for investments and capital allocation.
• The company is seeing increasing adoption of EVO ICL, with a focus on expanding its use for -6D to -8D myopia.
• STAAR is making investments in new and emerging markets, including the United States, Mexico, Indonesia, Brazil, India, and China.
• The company has a strong focus on research and development, with over 200 peer-reviewed clinical papers on ICLs.

Negatives

• The company's 2024 outlook for adjusted EBITDA is lower than 2023, with a projected $36 million compared to $56.7 million.
• The company is facing macroeconomic headwinds associated with a normal business cycle.
• The company's 2024 ICL sales growth in China is expected to be approximately 10%, with all other countries flat.
• The company's 2024 ICL sales growth in the US is expected to be flat, with a growth of $2 million in the second half of 2024 resulting in approximately 10% growth for the full year.

Risks

• Global economic conditions could impact the company's performance.
• Regulatory agencies could delay or reject product approvals.
• International conflicts and trade disputes could affect the company's operations.
• The company is substantially dependent on demand from Asia.
• The willingness of surgeons and patients to adopt new products and procedures could impact sales.
• The company's financial projections are subject to numerous risks and uncertainties.

Future Outlook

STAAR Surgical is targeting significant growth in sales and profitability by 2026, with a focus on expanding the use of EVO ICL and entering new markets. The company expects to sell more ICLs in the next three years than in the previous 25 years combined.

Management Comments

• Tom Frinzi, President and CEO of STAAR Surgical, stated that EVO ICL is the next logical step in refractive innovation with clear differentiators in patient outcomes and satisfaction.
• Tom Frinzi also mentioned that their lens-based technology is ushering in the next generation of vision correction by helping to free patients from the struggle of daily contacts and eyeglasses.

Industry Context

The announcement comes amid a growing global myopia epidemic, which is expected to impact over half the world's population by 2050. STAAR's EVO ICL is positioned as a key solution for vision correction, competing with other refractive procedures like LASIK and SMILE. The company is aiming to increase its market share in the refractive surgery market.

Comparison to Industry Standards

• STAAR's EVO ICL is estimated to hold approximately 15% of the global refractive procedure market in 2023, which is a significant share compared to other refractive procedures.
• The company's ICL unit growth has outperformed the global refractive industry procedure growth by 26 points in 2023 and 28 points in 2022.
• The document mentions that the current global refractive surgery market is approximately 4 million procedures annually, providing a benchmark for STAAR's market share.
• The document highlights that STAAR's market share capture in Japan, China, and South Korea is representative of their market share opportunity in every market they operate in, suggesting a strong potential for growth in other regions.

Stakeholder Impact

• Shareholders can expect continued growth and profitability, with a focus on long-term value creation.
• Surgeons and clinicians will benefit from the company's focus on training and support.
• Patients will have access to advanced vision correction technology that can reduce their reliance on glasses and contact lenses.
• Employees will be part of a growing and innovative company with a strong focus on performance.

Next Steps

• STAAR will continue to focus on increasing surgeon confidence in eye measurement and lens size selection.
• The company will work to expand sales of EVO ICL for -6D to -8D myopia.
• STAAR will continue to invest in new product innovation.
• The company will focus on growing new and emerging markets.
• STAAR will continue to build a high-performance organization.

Key Dates

Keywords

ICL, EVO ICL, Implantable Collamer Lens, Myopia, Vision Correction, Refractive Surgery, Ophthalmology, Adjusted EBITDA, Net Sales, STAAR Surgical