On Tuesday, LeMaitre Vascular (NASDAQ:LMAT) discussed first-quarter financial results during its earnings call. The full transcript is provided below.
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The full earnings call is available at https://edge.media-server.com/mmc/p/xrewxifx/
Summary
LeMaitre Vascular reported an 11% increase in sales and a 72.7% gross margin for Q1 2026, with significant growth in product categories like grafts (20%), valvulotomes (15%), and carotid shunts (11%).
The company is focusing on expanding its Autograph product line, with international sales expected to reach $10 million in 2026, up from $4 million in 2025. Key strategic initiatives include filing for international approvals and extending product sizes.
Operating income increased by 41% to $17.8 million, and the company ended Q1 with $367 million in cash. Guidance for 2026 includes 12% sales growth and 26% EPS growth.
Operational highlights include the expansion of the sales force, with plans to have 170-180 reps by year-end, and the opening of an Irish warehouse for pan-European distribution.
Management discussed ongoing efforts in M&A, particularly in open vascular and cardiac surgery markets, and highlighted the potential for price increases across geographies.
Full Transcript
OPERATOR
Welcome to The LeMaitre Vascular Q1 2026 Financial Results Conference Call. As a reminder to everyone, today’s call is being recorded at this time. I would like to turn the call over to Mr. Dorian LeBlanc, Chief Financial Officer of LeMaitre Vascular. Please go ahead, sir. Thank you.
Dorian LeBlanc (Chief Financial Officer)
Good afternoon and thank you for joining us on our Q1 2026 conference call. With me on today’s call is our CEO George Lemaitre and our President Dave Roberts. Before we begin, I’ll read our Safe Harbor Statement. Today we’ll be making some forward-looking statements within the meaning of the US 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 and expect, anticipate, pursue, forecast and similar expressions. Our forward-looking statements are based on our estimates and assumptions as of today, May 5, 2026 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 10K and subsequent SEC filings, including disclosures of factors that could cause results to differ materially from those expressed or or implied. During this call we will discuss non GAAP financial measures such as organic sales growth. Reconciliations of GAAP to non GAAP measures discussed in this call are contained in the Associated Press release and if applicable, in supplemental materials, both of which are available in the Investor Relations section of our website www.LeMaitre.com. I’ll now turn the call over to George LeMaitre.
George Lemaitre (Chief Executive Officer)
Thanks Dorian. Q1 featured 11% sales growth, a 72.7% gross, margin 42%, EPS growth grafts were up 20%, Valvetomes 15% and Carotid shunts 11%. As each category posted record sales, our three geographies also posted record sales. EMEA was up 20%, APAC 18% and the Americas 7%. Autograft has become our largest product and we’re investing in its growth in three ways. Number one filing more international approvals, number two making longer sizes available for leg bypasses and number three proving quick stick claims for AV access. Worldwide autograph sales grew 36% in Q1. International autograph sales in Q1 were $2.1 million and we expect 2026 sales to be $10 million versus 4 million in 2025. Health Canada has approved Autograft and the launch is now planned for H2 2026 as we finalize Canadian specific Packaging validations Additional autograft approvals are expected in 2027 for Korea, Brazil, Vietnam and India. We’re also working to make longer autographs available because European surgeons use autographs for leg bypasses. Our longest autograph, which is 50cm, is now in high demand and we know we could sell longer sizes. Unfortunately, our current packaging tube is just 53 centimeters long, so the first step is to gain approval for a longer tube and we plan to make these filings in the US and Europe in H2 2026. First, sales of these longer autographs could start in H2 2027. Separately, we’ve made a pre submission filing to the FDA as we seek quick stick AV access claims on Autograft’s US Labeling. This pre submission will help us collaborate with the FDA to develop the pathway for a PMA filing or to design a clinical trial. While Autograft’s current US labeling restricts cannulation to 10 days after implantation, peer reviewed literature indicates that autograft can be cannulated one to three days after implantation. RestoreFlow Allografts (RFA) grew 25% in Q1 led by strong US results. We currently distribute tissues in three countries, the US, Canada and the UK. German implants should begin in Q2 and we now expect to receive Irish approval in H2. Our Irish warehouse opened in April and we’ll begin shipping our core medical devices starting in June as we await an audit from the Irish Tissue Authority. This audit should enable tissue distribution from our Dublin warehouse to Irish hospitals in H2. Long term, this warehouse will be used for pan European distribution. We filed for Australian approval in April and we plan to file in Austria, Holland, Belgium, Spain and Switzerland in 2026. As for our RestoreFlow Allografts (RFA) facility transfer, tissue processing is ramping up in Burlington and we should complete the project by year end. We ended Q1 with 158 sales reps up 3% year over year and we plan to end 2026 with 170 to 180. We currently have 16 open requisitions for new reps, mostly in the US. We ended Q1 with 35 RSMs and country managers up 13% year over year. We expect to go direct in Poland in Q4 and this project will include an office warehouse, a GM customer service team and several reps. Poland will be our 32nd direct country. Higher ASPs geographic expansion and disciplined spending produced 11% sales growth and 42% EPS growth in Q1 full year. 2026 also shows OP leverage. Increased guidance implies 12% sales growth and 26% EPS growth. Our new 2030 goals are posted on the walls of all LEMAITRE conference rooms. We call them the 2030 planks and our playbook remains simple produce quality devices, build our sales force, go direct in new countries, acquire niche products and focus on profitability, cash flow and dividends. I’ll now turn the call over to Dorian.
Dorian LeBlanc (Chief Financial Officer)
Thanks George. Organic sales growth of 10% over Q1 2025 was driven by average selling price increases of 8% and unit growth of 2%. Unit growth was impacted by a lower than average quarter in our distribution business, which can be lumpy. Excluding distribution, direct sales grew 12.8% organically comprised of 8.4% price and 4.4% units. Total organic revenue growth excludes a $2 million foreign exchange benefit in Q1 2026 and $1.5 million of Azio distribution sales in Q1 2025. These two items largely offset one another. We discontinued azio distribution in May 2025. In Q1 2026 we posted a gross margin of 72.7%. The 350 basis point year over year improvement was driven primarily by higher ASPs and manufacturing efficiencies. Our Q2 gross margin guidance of 72.1% reflects the impact of our new Billerica warehouse and the manufacturing transfer of our RFA processing to Burlington. Operating expenses in Q1 2026 were 30.6 million, an increase of 6% versus Q1 2025. Despite the continued expansion of the sales force, Overall company headcount decreased 3% from 662 at March 1, 2025 to 641 at March 31, 2026. Q1 2026 operating income increased 41% year over year to $17.8 million with an operating margin of 27% compared to 21% in Q1 2025. Fully diluted earnings per share were $0.68, up 42%, benefiting from strong operating income and an improved effective tax rate. We believe our effective tax rate will remain lower than our historical rates given the strong growth in high margin international autograph sales and our overall geographic sales mix. A larger share of our income qualifies for the foreign derived intangible income or FIDI deduction, which structurally lowers our tax rate excluding the discrete items in this quarter, we expected 80 basis point improvement from historical effective tax rate due to the higher FIDI deductions, another benefit of our US manufacturing footprint. Cash from operations generated 15 million in Q1 2026 as compared to 9 million in Q1 2025 we paid $5.7 million in dividends to our shareholders during the quarter. We ended Q1 2026 with $367 million in cash and securities. 8 million in the quarter. The LeMaitre playbook continues to drive broad based revenue growth supported by our differentiated products, direct to hospital model and strong commercial organization. We are affirming our full year revenue guidance of 280 million, representing 12% organic growth. We are increasing our annual guidance for gross margin to 72.3% and operating to 79.8 million, representing 24% growth over adjusted 2025 operating income. We are also increasing annual guidance for diluted earnings per share to $3 or 26% growth from adjusted 2025. Historically, Q2 has been one of our strongest quarters and we’re expecting revenue of 71.5 million and an operating margin of 30%. Our current guidance assumes a constant Euro USD exchange rate of 1.17 and no dilutive impact from our convertible debt. For additional details, please see today’s press release. Finally, we’d like to welcome Keith Hinton from Freedom Capital Markets to the call. Keith initiated coverage on Lemaitre on March 31. With that, I’ll turn the call over to the operator for questions.
OPERATOR
Thank you. At this time we will conduct a question and answer session. As a reminder to ask a question, you will need to press Star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by as we compile the Q and A roster. Our first question comes from the line of Keith Hinton from Freedom Capital Markets. Your line is now open.
Keith Hinton (Equity Analyst)
Great, thank you. Thanks for taking the question. I have kind of a high level question here on the pricing side of things. So you know EMEA has been growing faster than the US for a few years. You know it’s my assumption that the prices there start lower and there’s less ability to take price over time. So considering that kind of balanced against the ongoing mix shift towards grafts where it seems like you do have good pricing leverage in the us Just how should we think about the high sustainability of high single digit sustained pricing increases in the out years?
George Lemaitre (Chief Executive Officer)
Hi Keith, this is George LeMaitre again. Welcome to your firm for covering the company and also welcome to the call. In terms of asking about price increases and the sustainability, it’s a question you can imagine we get frequently. We feel very comfortable with what’s going on here. We have another year where I think we’re validating all the way into Q1 that we’re able to get these price increases. We got 8% in Q1. Did you want me to distinguish between European pricing flexibility and US pricing flexibility? Was that part of your question? Yes, that would be terrific. Thank you. Right. I would say it’s not exactly answering it, but on that topic, I would say the floors, the pricing floors we put in are largely in and installed in the United states. In about 55% of our products we have pricing floors and then we change them from year to year, of course. And in Europe, I still think we have a little room to go. I think only about 40% of our products have pricing floors. So you can do more. You can add pricing floors to more of the different products over there. And also in Europe, I think it takes longer for prices to really get installed since particularly in southern Europe, a lot of the stuff is sold on three year tenders. And so you can only change your price once every three years. So you change it and then it takes three years for it to fully get implemented. I hope that makes sense to you. So maybe a little more room over in Europe given the fact that we’re not as price friendly floored over there and that it takes longer once you do do a price to get to a price hike. It takes longer to get to.
Keith Hinton (Equity Analyst)
Understood. Great. And then just one specific. And again, apologies if I missed this, but can you talk a little bit about the performance for patches in the quarter? I know there was a bit of a tough comp there. You were lapping some supply issues for a competitor and I think that was the last quarter of Alucia. So just talk a little bit about that and how we should think about patches growth going forward.
George Lemaitre (Chief Executive Officer)
Right. And I can pull out. It was not such a great quarter for patches. XenoSure was up 5%. That’s the core patch. And I can get you in a second if you standby, I can get you the full patch category. If anyone in the room has that, we can do that. XenoSure is the main piece of all this. And I’m getting closer here. Keith, I should know this off the top of my head. Let’s see, let’s see,. That is. No, that’s not going to help me. One second. I can do it. Organic growth for the whole category was 2.3% for the quarter again, 5% for Zeno and 2.3% for the whole category. Patches.
Keith Hinton (Equity Analyst)
Excellent. Thank you so much. Yep, no problem.
OPERATOR
Thank you. Our next question. So we’re having some audio problems. I think we lost you for a little while. Yep. Oh, I’m so sorry. Our next question is coming from the line of Michael Pitofsky from Barrington Research. Your line is now open, Michael.
Michael Pitofsky (Equity Analyst)
Okay, thank you. Good evening. So, George, I guess I’m curious with the stuff of the last, I guess, two months in the middle eas, are you guys seeing any impact …
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