Exhibit 99.1

 

 

 

 

 

Align Technology Ethos Communication:
Yin Cantor   Shannon Mangum Henderson
(408) 470-1044   (678) 261-7803
ycantor@aligntech.com   align@ethoscommunication.com

 

 

 

ALIGN TECHNOLOGY ANNOUNCES FOURTH QUARTER AND 2017 FINANCIAL RESULTS

 

Q4 revenues up 43.7% year-over-year to a record $421.3 million, and diluted EPS of $0.13, includes $86.6 million tax expense, or $1.06 per diluted share negative impact due to the new U.S. Tax Cut and Jobs Act

Q4 operating income up 60.3% year-over-year to a record $109.6 million or operating margin of 26.0%

Q4 total Invisalign case shipments up 34.2% year-over-year to 255.0 thousand

Q4 Invisalign cases for teenage patients up 44.1% year-over-year to 63.5 thousand

Q4 scanner and services revenues up 37.0% year-over-year to $57.1 million

Record 2017 Invisalign revenues up 34.1% year-over-year to $1.3 billion with Invisalign case shipments up 31.4% year-over-year to 931.0 thousand

Record 2017 iTero scanner volume up 37.5%

 

SAN JOSE, Calif., January 30, 2018 -- Align Technology, Inc. (Nasdaq: ALGN) today reported financial results for the fourth quarter and year ended December 31, 2017. Invisalign case shipments in the fourth quarter of 2017 (Q4’17) were 255.0 thousand, up 34.2% year-over-year. North America and International case shipments were up year-over-year 24.2% and 52.3%, respectively. Q4’17 Invisalign cases for teenage patients were 63.5 thousand, up 44.1% year-over-year. Q4’17 revenues were $421.3 million, up 43.7% year-over-year with Q4’17 operating income a record $109.6 million, up 60.3% year-over-year resulting in an operating margin of 26.0%. Q4’17 net profit was $10.3 million, or $0.13 per diluted share, which includes an $86.6 million tax expense, or $1.06 per diluted share negative impact due to the new U.S. Tax Cut and Jobs Act, comprised of a $10.0 million non-cash write-down of our deferred tax assets and a mandatory deemed repatriation tax of $76.6 million.

 

For 2017, record Invisalign revenues were $1.3 billion, up 34.1% year-over-year with Invisalign case shipments of 931.0 thousand, up 31.4% year-over-year. 2017 iTero revenues were $164.2 million, up 35.1% with record volumes, up 37.5% year-over-year. 2017 Invisalign cases for teenage patients were 237.5 thousand, up 40.4% year-over-year. For 2017, revenues were $1.5 billion, up 36.4% year-over-year and net profit was $231.4 million, or $2.83 per diluted share, which includes an $86.6 million tax expense, or $1.06 per diluted share negative impact due to the new U.S. Tax Cut and Jobs Act, comprised of a $10.0 million non-cash write-down of our deferred tax assets and a mandatory deemed repatriation tax of $76.6 million.

Align Technology, Inc. 2820 Orchard Pkwy, San Jose, CA 95134

Tel: (408) 470-1000 Fax: (408) 470-1010

WWW.ALIGNTECH.COM

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

Commenting on Align’s Q4 and 2017 results, Align Technology President and CEO Joe Hogan said, “Overall, the fourth quarter was a strong finish to another outstanding year for Align, with better than expected revenues, volumes and operating income. Record Q4 revenues were up 43.7% year-over-year driven by increased Invisalign volumes across all geographies and customer channels, as well as by record iTero scanner revenue. Q4 Invisalign volume was up 34.2% year-over-year reflecting strong international growth from increased utilization and expansion of our customer base which included over 4,000 new customers for the third consecutive quarter. Notwithstanding this strong performance, our Q4 results were impacted by the new U.S. Tax Cut and Jobs Act which reduced our reported net income and EPS. However, Q4 operating income was a record $109.6M or 26.0%.”

 

Hogan continued, “For the full year, revenues of $1.5 billion increased 36.4% year-over-year driven by both record Invisalign revenue which surpassed the $1 billion mark for the first time ever and record iTero scanner revenues. These results reflect continued progress and execution of our four strategic growth drivers which focus on: driving international expansion; increasing Orthodontists utilization of Invisalign, especially with teenagers; enabling GP dentists to treat or refer more Invisalign cases; and generating consumer demand from millions of people worldwide and connecting them with an Invisalign doctor.”

 

 

GAAP Summary Financial Comparisons

Fourth Quarter Fiscal 2017

   Q4’17  Q3’17  Q4’16  Q/Q Change  Y/Y Change
Invisalign Case Shipments1   255.0K   236.1K   190.1K   +8.0%   +34.2%
Net Revenues  $421.3M  $385.3M  $293.2M   +9.4%   +43.7%
    Clear Aligner2  $364.2M  $341.6M  $251.5M   +6.6%  +44.8%
    Scanner & Services  $57.1M  $43.7M  $41.7M    +30.8%   +37.0%
Net Profit3  $10.3M  $82.6M  $47.6M   (87.6)%   (78.4)%
Diluted EPS3  $0.13   $1.01   $0.59   $(0.88)  $(0.46)

 

Fiscal 2017

         2017  2016  Y/Y Change
Invisalign Case Shipments1         931,045   708,500   +31.4%
Net Revenues            $1,473.4M  $1,079.9M   +36.4%
    Clear Aligner2            $1,309.3M  $958.3M   +36.6%
    Scanner & Services            $164.2M  $121.5M   +35.1%
Net Profit3            $231.4M  $189.7M   +22.0%
Diluted EPS3            $2.83   $2.33    +$0.50 

Note: Changes and percentages are based on actual values and may effect totals due to rounding

1 Invisalign Shipment figures do not include SmileDirectClub aligners

2 Clear aligner revenue includes revenues from Invisalign clear aligners and SmileDirectClub aligners

3 Q4’17 and 2017 net profit and diluted EPS includes $86.6 million tax expense, or $1.06 per diluted share negative impact due to the new U.S. Tax Cut and Jobs Act

 

 - 2 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

As of December 31, 2017, Align had $761.5 million in cash, cash equivalents and marketable securities compared to $700.0 million as of December 31, 2016. We repurchased approximately 0.2 million shares of stock for $50.0 million in Q4’17 under the April 2016 Repurchase Program. We have $200.0 million remaining available for repurchases under the existing stock repurchase authorization.

 

2017 Business Highlights

 

The following list highlights Align’s key announcements over the past year:

 

Expanded restorative digital workflow solutions for iTero Element® scanner to include iTero Chairside CAD, a chairside prosthetics design software application that will support same-day dentistry as part of collaboration with Exocad GmbH.
Celebrated the 5 millionth Invisalign® patient, a 12-year old Canadian teenager starting Invisalign treatment with mandibular advancement.
Signed distribution agreement with Glidewell Dental for the iTero Element® intraoral scanning system in North America with glidewell.io™ In-Office Solution, a chairside restorative ecosystem designed to simplify the process of prescribing and delivering laboratory-quality dental restorations.
Opened the first Invisalign® store pilot in San Francisco to help consumers connect with an Invisalign® provider to improve their smile with Invisalign® treatment.
Awarded nearly $300,000 to researchers at universities in North America, Europe and Asia Pacific as part of the Company’s Research Award Program to support clinical and scientific dental research.
Signed distribution agreement Patterson Dental for iTero Element® intraoral scanning system in U.S. and Canada.
Opened first Invisalign® Treatment Planning Facility in Chengdu, China.
Launched TimeLapse technology for digital scan comparisons and ability to complete a scan in as little as 1 minute as part of a software upgrade for its iTero Element® intraoral scanners.
Received U.S. Patents for SmartTrack material, an innovative multi-layer polymer that delivers more gentle, constant force to improve control of tooth movements with Invisalign® clear aligners.
Celebrated the 1 millionth Invisalign® Teen patient, an 11 year-old boy from the U.S. starting Invisalign treatment.
Launched first global, multi-million dollar Invisalign brand platform and marketing campaign.
Achieved over 1 million scans submitted with iTero Element® scanner since its introduction in 2015.
Introduced of Invisalign® Teen with mandibular advancement feature, the first clear aligner solution for Class II correction in growing tween and teen patients. (Not yet available in the U.S., pending FDA approval.)
Expanded digital implant workflow options for the iTero® intraoral scanner with Nobel Biocare implants and ELOS Medtech scan bodies.

 

 - 3 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

Q1 2018 Business Outlook

For the first quarter of 2018 (Q1’18), Align provides the following guidance:

Net revenues in the range of $400 million to $410 million, up approximately 29% to 32% over the same period a year ago.
Invisalign case shipments in the range of 264 thousand to 269 thousand, up approximately 27% to 29% over the same period a year ago.
Operating margin in the range of 18.5% to 19.5%
Diluted EPS in the range of $0.94 to $0.98.

 

Align Web Cast and Conference Call

Align will host a conference call today, January 30, 2018 at 4:30 p.m. ET, 1:30 p.m. PT, to review its fourth quarter and year ended 2017 results, discuss future operating trends and the business outlook. The conference call will also be web cast live via the Internet. To access the webcast, go to the “Events & Presentations” section under Company Information on Align’s Investor Relations web site at http://investor.aligntech.com. To access the conference call, please dial 201-689-8261. An archived audio web cast will be available beginning approximately one hour after the call's conclusion and will remain available for approximately 12 months. Additionally, a telephonic replay of the call can be accessed by dialing 877-660-6853 with conference number 13674959 followed by #. For international callers, please dial 201-612-7415 and use the same conference number referenced above. The telephonic replay will be available through 5:30 p.m. ET on February 13, 2018.

 

About Align Technology, Inc.

Align Technology designs and manufactures the Invisalign® system, the most advanced clear aligner system in the world, and iTero® intraoral scanners and services. Align’s products help dental professionals achieve the clinical results they expect and deliver effective, cutting-edge dental options to their patients. Visit www.aligntech.com for more information.

 

For additional information about the Invisalign system or to find an Invisalign provider in your area, please visit www.invisalign.com. For additional information about iTero digital scanning system, please visit www.itero.com.

 - 4 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

Forward-Looking Statement

This news release, including the tables below, contains forward-looking statements, including statements regarding certain business metrics for the first quarter of 2018 year end, including, but not limited to, anticipated net revenues, gross margin, operating expenses, operating profit, diluted earnings per share, tax rate and case shipments. Forward-looking statements contained in this news release and the tables below relating to expectations about future events or results are based upon information available to Align as of the date hereof. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. As a result, actual results may differ materially and adversely from those expressed in any forward-looking statement. Factors that might cause such a difference include, but are not limited to, difficulties predicting customer and consumer purchasing behavior, Align's ability to protect its intellectual property rights, continued compliance with regulatory requirements, competition from existing and new competitors, the willingness and ability of our customers to maintain and/or increase product utilization in sufficient numbers, the possibility that the development and release of new products does not proceed in accordance with the anticipated timeline, the possibility that the market for the sale of these new products may not develop as expected, or that the expected benefits of new or existing business relationships will not be achieved as anticipated, the risks relating to Align's ability to sustain or increase profitability or revenue growth in future periods while controlling expenses, growth related risks, including capacity constraints and pressure on our internal systems and personnel, the security of customer and/or patient data is compromised for any reason, continued customer demand for our existing and new products, changes in consumer spending habits as a result of, among other things, prevailing economic conditions, levels of employment, salaries and wages and consumer confidence, the timing of case submissions from our doctors within a quarter, acceptance of our products by consumers and dental professionals, foreign operational, political and other risks relating to Align's international manufacturing operations, Align's ability to develop and successfully introduce new products and product enhancements and the loss of key personnel. These and other risks are detailed from time to time in Align's periodic reports filed with the Securities and Exchange Commission, including, but not limited to, its Annual Report on Form 10-K for the year ended December 31, 2016, which was filed with the Securities and Exchange Commission (SEC) on February 28, 2017, and its latest Quarterly Report on Form 10-Q for the quarter ended September 30, 2017, which was filed with the SEC on November 2, 2017. Align undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

 

 

 - 5 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

 

ALIGN TECHNOLOGY, INC.            
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS      
(in thousands, except per share data)            
             
   Three Months Ended
December 31,
  Year Ended
December 31,
   2017  2016  2017  2016
             
Net revenues  $421,323   $293,203   $1,473,413   $1,079,874 
                     
Cost of net revenues   103,406    72,954    356,466    264,580 
                     
Gross profit   317,917    220,249    1,116,947    815,294 
                     
Operating expenses:                    
Selling, general and administrative   182,141    130,268    665,777    490,653 
Research and development   26,170    21,609    97,559    75,720 
Total operating expenses   208,311    151,877    763,336    566,373 
                     
Income from operations   109,606    68,372    353,611    248,921 
                     
Interest and other income (expense), net   2,581    (7,516)   11,188    (6,355)
                     
Net income before provision for income taxes and equity in losses (gains) of investee   112,187    60,856    364,799    242,566 
                     
Provision for income taxes   103,654    12,028    130,162    51,200 
Equity in losses (gains) of investee, net of tax   (1,731)   1,207    3,219    1,684 
                     
Net income  $10,264   $47,621   $231,418   $189,682 
                     
Net income per share:                    
Basic  $0.13   $0.60   $2.89   $2.38 
Diluted  $0.13   $0.59   $2.83   $2.33 
                     
Shares used in computing net income per share:                    
Basic   80,080    79,667    80,085    79,856 
Diluted   81,863    81,248    81,832    81,484 

 

 

 - 6 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

 

ALIGN TECHNOLOGY, INC.      
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS   
(in thousands)      
       
   December 31,
2017
  December 31,
2016
ASSETS      
       
Current assets:      
Cash and cash equivalents  $449,511   $389,275 
Marketable securities, short-term   272,031    250,981 
Accounts receivable, net   322,825    247,415 
Inventories   31,688    27,131 
Prepaid expenses and other current assets   80,948    38,176 
Total current assets   1,157,003    952,978 
           
Marketable securities, long-term   39,948    59,783 
Property, plant and equipment, net   348,793    175,167 
Equity method investments   54,606    45,061 
Goodwill and intangible assets, net   89,068    81,998 
Deferred tax assets   50,059    67,844 
Other assets   38,379    13,320 
           
Total assets  $1,777,856   $1,396,151 
           
LIABILITIES AND STOCKHOLDERS' EQUITY          
           
Current liabilities:          
Accounts payable  $36,776   $28,596 
Accrued liabilities   194,198    134,332 
Deferred revenues   266,842    191,407 
Total current liabilities   497,816    354,335 
           
Income tax payable   114,091    45,133 
Other long-term liabilities   15,579    1,294 
Total liabilities   627,486    400,762 
           
Total stockholders' equity   1,150,370    995,389 
           
Total liabilities and stockholders' equity  $1,777,856   $1,396,151 

 

 - 7 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

 

ALIGN TECHNOLOGY, INC.
INVISALIGN BUSINESS METRICS*
                        
                        
   Q4  Fiscal  Q1  Q2  Q3  Q4  Fiscal  
   2016  2016  2017  2017  2017  2017  2017  
Invisalign Average Selling Price (ASP):                               
Worldwide ASP  $1,230   $1,265   $1,270   $1,285   $1,310   $1,305   $1,295   
International ASP  $1,315   $1,335   $1,325   $1,335   $1,390   $1,390   $1,360   
                                      
Invisalign Cases Shipped by Geography:                                     
North America   122,555    463,810    132,885    146,510    144,870    152,245    576,510   
International   67,500    244,690    75,175    85,380    91,195    102,785    354,535   
Total Cases Shipped   190,055    708,500    208,060    231,890    236,065    255,030    931,045   
YoY % growth   18.5%   21.5%   27.1%   31.0%   32.8%   34.2%   31.4%  
QoQ % growth   6.9%        9.5%   11.5%   1.8%   8.0%       
                                      
Number of Invisalign Doctors Cases Were Shipped To:                                     
North America   23,265    34,065    23,910    24,695    24,845    25,365    36,415   
International   13,635    20,415    14,955    16,570    17,760    19,620    27,990   
Total Doctors Cases Shipped To   36,900    54,480    38,865    41,265    42,605    44,985    64,405   
                                      
Invisalign Doctor Utilization Rates*:                                     
North America   5.3    13.6    5.6    5.9    5.8    6.0    15.8   
North American Orthodontists   11.3    36.6    12.6    13.6    13.8    14.0    46.6   
North American GP Dentists   3.2    7.6    3.1    3.3    3.1    3.3    8.2   
International   5.0    12.0    5.0    5.2    5.1    5.2    12.7   
Total Utilization Rates   5.2    13.0    5.4    5.6    5.5    5.7    14.5   
*# of cases shipped/# of doctors to whom cases were shipped                                     
                                      
Number of Invisalign Doctors Trained:                                     
North America   1,420    4,720    980    1,620    1,460    1,340    5,400   
International   2,280    6,960    2,280    3,255    2,820    2,745    11,100   
Total Doctors Trained Worldwide   3,700    11,680    3,260    4,875    4,280    4,085    16,500   
Total to Date Worldwide   115,470    115,470    118,730    123,605    127,885    131,970    131,970   

 

Note: Historical public data may differ due to rounding. Additionally, rounding may effect totals.

*Invisalign business metrics exclude SmileDirectClub aligners.  

 

ALIGN TECHNOLOGY, INC.
STOCK-BASED COMPENSATION
(in thousands)
                        
   Q4  Fiscal  Q1  Q2  Q3  Q4  Fiscal  
   2016  2016  2017  2017  2017  2017  2017  
Stock-based Compensation (SBC)                                     
SBC included in Gross Profit  $1,078   $3,966   $925   $768   $833   $804   $3,330   
SBC included in Operating Expenses   13,136    50,182    13,887    13,477    14,134    14,026    55,524   
Total SBC Expense  $14,214   $54,148   $14,812   $14,245   $14,967   $14,830   $58,854   

 

 

 - 8 - 

Align Technology Announces Fourth Quarter and Year Ended 2017 Results

 

ALIGN TECHNOLOGY, INC.

BUSINESS OUTLOOK SUMMARY

(unaudited)

             

The outlook figures provided below and elsewhere in this press release are approximate in nature since Align’s business outlook is difficult to predict.  Align’s future performance involves numerous risks and uncertainties and the company’s results could differ materially from the outlook provided.  Some of the factors that could affect Align’s future financial performance and business outlook are set forth under “Forward Looking Information” above in this press release.

             

 

Financial Outlook

(in millions, except per share amounts and percentages)

             

   Q1'18 Guidance
    
   GAAP
    
Net Revenues   $400.0 - $410.0 
      
Gross Margin   74.3% - 75.0% 
      
Operating Expenses   $223.5 - $227.5 
      
Operating Margin   18.5% - 19.5% 
      
Net Income per Diluted Share   $0.94 - $0.98(1)
      
      
Business Metrics:   Q1'18 
      
Case Shipments   264.0K - 269.0K 
Capital Expenditure   $65M - $70M 
Depreciation & Amortization   $10.5M - $11M 
Diluted Shares Outstanding   82.0M(2)
Stock Based Compensation Expense   $16.2M 
Effective Tax Rate   2.0%(1)

 

(1) Includes the benefit from the adoption of the accounting standard update 2016-09 related to share-based compensation expense

(2) Excludes any stock repurchases during the quarter

 

 

- 9 -

 

 


The following information was filed by Align Technology Inc (ALGN) on Tuesday, January 30, 2018 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.

View differences made from one year to another to evaluate Align Technology Inc's financial trajectory

Compare SEC Filings Year-over-Year (YoY) and Quarter-over-Quarter (QoQ)
Sample 10-K Year-over-Year (YoY) Comparison

Compare this 10-K Annual Report to its predecessor by reading our highlights to see what text and tables were  removed  ,   added    and   changed   by Align Technology Inc.

Continue

Never Miss A New SEC Filing Again


Real-Time SEC Filing Notifications
Screenshot taken from Gmail for a new 10-K Annual Report
Last10K.com Member Feature

Receive an e-mail as soon as a company files an Annual Report, Quarterly Report or has new 8-K corporate news.

Continue

We Highlighted This SEC Filing For You


SEC Filing Sentiment Analysis - Bullish, Bearish, Neutral
Screenshot taken from Wynn's 2018 10-K Annual Report
Last10K.com Member Feature

Read positive and negative remarks made by management in their entirety without having to find them in a 10-K/Q.

Continue

Widen Your SEC Filing Reading Experience


Increased Reading Area for SEC Filings
Screenshot taken from Adobe Inc.'s 10-Q Quarterly Report
Last10K.com Member Feature

Remove data columns and navigations in order to see much more filing content and tables in one view

Continue

Uncover Actionable Information Inside SEC Filings


SEC Filing Disclosures
Screenshot taken from Lumber Liquidators 10-K Annual Report
Last10K.com Member Feature

Read both hidden opportunities and early signs of potential problems without having to find them in a 10-K/Q

Continue

Adobe PDF, Microsoft Word and Excel Downloads


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshots of actual 10-K and 10-Q SEC Filings in PDF, Word and Excel formats
Last10K.com Member Feature

Export Annual and Quarterly Reports to Adobe PDF, Microsoft Word and Excel for offline viewing, annotations and analysis

Continue

FREE Financial Statements


Download Annual and Quarterly Reports as PDF, Word and Excel Documents
Screenshot of actual balance sheet from company 10-K Annual Report
Last10K.com Member Feature

Get one-click access to balance sheets, income, operations and cash flow statements without having to find them in Annual and Quarterly Reports

Continue for FREE

Intrinsic Value Calculator


Intrinsic Value Calculator
Screenshot of intrinsic value for AT&T (2019)
Last10K.com Member Feature

Our Intrinsic Value calculator estimates what an entire company is worth using up to 10 years of financial ratios to determine if a stock is overvalued or not

Continue

Financial Stability Report


Financial Stability Report
Screenshot of financial stability report for Coco-Cola (2019)
Last10K.com Member Feature

Our Financial Stability reports uses up to 10 years of financial ratios to determine the health of a company's EPS, Dividends, Book Value, Return on Equity, Current Ratio and Debt-to-Equity

Continue

Get a Better Picture of a Company's Performance


Financial Ratios
Available Financial Ratios
Last10K.com Member Feature

See how over 70 Growth, Profitability and Financial Ratios perform over 10 Years

Continue

Log in with your credentials

or    

Forgot your details?

Create Account