Company Address:
Exactech, Inc.
2320 NW 66th Ct.

Gainesville, Florida
(352) 377-1140

2320 NW 66th Ct. • Gainesville • Florida • 32653 • USA •
Investor Contact: Frank N. Hawkins, Jr. or Julie Marshall · Hawk Associates Inc. · (305) 451-1888 ·
Exactech Q2 Revenue $67.3 Million on Continuing Strong Extremity Sales. Q2 Net Income $4.8 Million. Diluted EPS $0.33
ALERT: The company held a conference call with CEO David Petty and key members of the management team on July 28 covering second quarter 2017 results. A webcast of the call is available at
This call will be archived for approximately 90 days.

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Exactech is a pure play orthopaedic competitor gaining market share in the rapidly expanding global biomedical device industry. The company's products are used in the restoration of bones and joints that have deteriorated as a result of injury or disease such as arthritis.

Exactech develops, manufactures, markets, distributes and sells its orthopaedic implant devices, including knee, shoulder and hip implant systems, surgical instrumentation and biologic services to hospitals and physicians in the U.S. and over 30 markets in Europe, the Americas, Asia and the Pacific. International sales represented 31.3% of total 2016 company sales.

Founded and led by an orthopaedic surgeon, the company has built its success on its customer-centric culture. Design assistance and feedback from its surgeon customers have helped Exactech develop a pipeline of innovative products that improve patient outcomes.

Company Overview

Q2 2017 Segment Performance

Extremity implant revenue rose 19% to $29.6 M

• Knee implant revenue was flat at $19.6 M

• Hip implant revenue decreased 8% to $11.5 M

• Other revenue decreased 27% to $6.7 M
*Other segment includes an aggregation of former biologics and spine segments



The company’s rapidly growing Equinoxe® shoulder implant system, the company’s largest segment, increased revenues in 2016 by 16% to $100.3M. The company attributes the growth of the Equinoxe system to continued surgeon success, a robust pipeline of enhancements and reduced operating room time saving thousands of dollars per case for hospitals. Shoulder sales represented 38.9% of company revenue in 2016. The company’s Vantage® Total Ankle System, an addition to the Exactech extremities product line and the first product in the foot and ankle market, was introduced in the third quarter of 2016.

Knee systems that meet the needs of hospitals and surgeons have been a hallmark of the company. Exactech’s Logic knee system and its Optetrak® differentiated, knee implant products provided 28.3% of the company's 2016 revenue.

Hip products, which accounted for 16.7% of company revenues in 2016, use materials such as ceramic bearing surfaces and enhanced polyethylene for industry leading wear performance. The most recently released Alteon® tapered wedge hip stem has been enthusiastically embraced by the company’s surgeon customers. Recent News
Exactech To Present to Investors at Baird 2017 Global Healthcare Conference
Exactech’s Truliant® Knee System Instrumentation Honored with International Design Excellence Award (IDEA®)
Exactech Q2 Revenue $67.3 Million On Continuing Strong Extremities Revenue
Exactech Schedules Second Quarter 2017 Earnings Release and Conference Call
Exactech Introduces New Computer-Assisted Software Application for Simplified Guidance in Total Knee Replacement

    Risk Factors
  • Market acceptance of new products
  • Significant resources of larger competitors
  • New government taxes
  • Partial dependency on third-party manufacturers
  • Foreign exchange volatility

The Outlook
Excluding the impact of the divested spine products from the prior year, revenue in the second quarter was up 5% and 7% in the first half of the year. T h e c o m p a n y ’s h i p r e v e n u e s w e r e n e g a t i v e l y i m p a c t e d b y d i s t r i b u t i o n transitions underway in certain markets outside the U. S. The company said it was pleased with the performance of its Extremities segment, which benefited modestly in the quarter from the pilot launch of the Vantage® ankle and the Equinoxe® Preserve humeral stem. In terms of the company’s product pipeline, a d d i t i o n a l p i l o t l a u n c h e s o f t h e ExactechGPS® shoulder application, Alteon® H.A. hip stem and the Truliant® knee system are all said to be going well.The company said it will be building inventory in Q3 and Q4 for these systems with expected full launch late in the year. The company’s sales channel development strategy remains important and will be further enhanced as the company moves more fully into the Truliant® knee system launch. Gross margins in the quarter decreased to 68.7% from 69.3% as average selling price decreases offset the increases in higher margin extremity sales. Total operating expenses for the quarter were relatively flat at $39.3 million due to divestiture of the spine segment being offset by an increase in product launch and development expenses. As a result, the company produced a net income increase of 9% to $4.9 million and a $0.33 diluted EPS for the quarter, which was in range of its expectations.

Exactech 2017 revenue guidance is $267 million - $271 million and diluted EPS target is $1.25 – $1.29 including the impact of the Q1 diluted per share costs related to the spine business transition. Adjusted basis $ 1.27 - $1.31. For the third quarter of 2017, the company anticipates revenues of $60.5 million to $62.5 million and diluted EPS of $0.23 - $0.25.

This guidance has been adjusted for anticipated full year impact of constant currency exchange rates. The foregoing statements regarding targets for the quarter and full year are forward-looking and actual results may differ materially. The EPS estimates are the company’s targets, not predictions of actual performance. Management
Executive Chairman-
William Petty, M.D.

CEO and Director-
David W. Petty

Executive Vice President of Finance & Chief Financial Officer-
Joel C. Phillips, CPA

Executive Vice President of Research and Development-
Gary J. Miller, Ph.D.

Vice President of Administration; Corporate Secretary-
Betty B. Petty

Senior Vice President, General Manager – Biologics Division-
Bruce Thompson

James G. Binch

Albert H Burstein, Ph.D.

William B. Locander, Ph.D.

Richard C. Smith

Fern S. Watts

W. Andrew Krusen

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