Press Release


Treace Medical Concepts Reports Third Quarter 2021 Financial Results

November 4, 2021 at 4:05 PM EDT

PONTE VEDRA, Fla., Nov. 04, 2021 (GLOBE NEWSWIRE) -- Treace Medical Concepts, Inc. (“Treace” or the “Company”) (NasdaqGS: TMCI), a commercial-stage orthopaedic medical device company driving a paradigm shift in the surgical treatment of hallux valgus (commonly known as bunions), today reported financial results for the third quarter ended September 30, 2021.

Recent Highlights:

  • Revenue of $21.6 million, a 52% increase over the same period last year and a 4.7% increase sequentially
  • Gross margin of 80.4%, an increase of 80 basis points from the same period last year
  • Commercial launch of AdductoplastyTM System, a comprehensive set of implants and instrumentation designed for reproducible midfoot correction
  • Additional U.S. patent grant on instrumented bunion correction, directed generally to methods of performing a bunion surgery to correct a first metatarsal alignment
  • New interim data from ALIGN3D™ clinical study, presented at 2021 American Orthopaedic Foot & Ankle Society annual meeting, demonstrating continued positive radiographic and patient-reported outcomes starting at 6 weeks and maintained at 24 months following the Lapiplasty® procedure. Low recurrence rate also maintained, with 0.9% (1 out of 104 patients) observed at 12 months post surgery
  • First patient treated in Mini3D™ Lapiplasty® clinical study evaluating patient outcomes using the Lapiplasty® Mini-Incision™ System
  • Appointed two new members to the Board of Directors

“In the third quarter we saw steady and encouraging progress across multiple initiatives. Despite pandemic-related headwinds, we posted a 52% revenue increase compared to year ago levels, launched a new and complementary midfoot correction Adductoplasty System, and treated our first patient in our Mini3D™ clinical study using our Lapiplasty® Mini-Incision™ System. Further, key business metrics, including surgeon utilization, customer engagement, and direct sales channel contributions, continue to trend favorably,” said John T. Treace, CEO, Founder and Board Member of Treace. “We are focused on our execution and believe we are well-positioned to drive market penetration of our Lapiplasty® System, supported by a comprehensive set of strategies and offerings, including a growing body of clinical evidence demonstrating reproducible outcomes with low recurrence rates.”

Third Quarter 2021 Financial Results

Revenue for the third quarter of 2021 was $21.6 million, representing an increase of 52% compared to $14.3 million in the third quarter of 2020. The increase was driven by an increased number of Lapiplasty® procedure kits sold and an expanded customer base.  

Gross profit for the third quarter of 2021 was $17.4 million, compared to a gross profit of $11.4 million in the third quarter of 2020. Gross margin increased to 80.4% in the third quarter of 2021, compared to 79.6% in the third quarter of 2020. Gross margin expansion was the result of improved absorption on an increased number of Lapiplasty® procedure kits sold and a higher blended average selling price.

Total operating expenses were $22.8 million in the third quarter of 2021, including sales and marketing (S&M) expenses of $16.0 million, research and development (R&D) expenses of $2.5 million, and general and administrative (G&A) expenses of $4.3 million. This compared to total operating expenses of $11.4 million, including S&M expenses of $8.1 million, R&D expenses of $1.5 million, and G&A expenses of $1.8 million in the third quarter of 2020. Expenses in the third quarter of 2021 reflect increased spending on marketing initiatives, patient outreach and additions to our sales organization.

Third quarter net loss was ($6.4) million, or ($0.12) per share, compared to net loss of ($2.8) million, or ($0.08) per share, for the same period of 2020.

Cash and cash equivalents were $109.5 million as of September 30, 2021.

Financial Outlook

For the full year 2021, Treace is reaffirming revenue guidance to be in the range of $90 million to $95 million, which represents approximately 57% to 65% growth over the Company’s 2020 revenue.

Webcast and Conference Call Details

Treace will host a conference call today, November 4, 2021, at 4:30 p.m. ET to discuss its third quarter 2021 financial results. The dial-in numbers are (800) 447-0521 for domestic callers or (847) 413-3238 for international callers, followed by Conference ID: 50243277. The live webcast of the conference call will be available on the Investor Relations section of the Company’s website at The webcast will be archived on the website following the completion of the call.  

Use of Non-GAAP Financial Measures

To supplement the financial results presented in accordance with GAAP, this earnings release presents Adjusted EBITDA, which the Company defines as net loss before depreciation and amortization expense, stock-based compensation expense and interest income/expense. Adjusted EBITDA is presented in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Management uses Adjusted EBITDA to evaluate the Company’s operating performance and trends, as well as for making planning decisions. The Company believes that Adjusted EBITDA helps to identify underlying trends in the Company’s business that may otherwise be masked by the effect of the expenses and other items that it excludes in Adjusted EBITDA. Accordingly, the Company believes Adjusted EBITDA provides useful information to investors and others in understanding and evaluating the Company’s operating results, enhancing the overall understanding of its past performance and future prospects, and allowing for greater transparency with respect to a key financial metric used by the Company’s management in their financial and operational decision-making. The Company also presents Adjusted EBITDA because it believes investors, analysts and rating agencies consider it a useful metric in measuring the Company’s performance against other companies and its ability to meet its debt service obligations.

There are limitations related to the use of non-GAAP financial measures such as Adjusted EBITDA because they are not prepared in accordance with GAAP, may exclude significant expenses required by GAAP to be recognized in the Company’s financial statements, and may not be comparable to non-GAAP financial measures used by other companies. The Company encourages investors to carefully consider its results under GAAP, as well as its supplemental non‐GAAP information and the reconciliation between these presentations, to more fully understand its business. Reconciliations between GAAP and non‐GAAP results are presented below.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements, including, but not limited to the Company’s belief that it is well positioned to drive continued market penetration of the Lapiplasty® System; and the Company’s expected revenue for full year 2021. Forward-looking statements are based on management’s current assumptions and expectations of future events and trends, which affect or may affect the Company’s business, strategy, operations or financial performance, and actual results and other events may differ materially from those expressed or implied in such statements due to numerous risks and uncertainties. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified. Factors that could cause actual results or other events to differ materially from those contemplated in this press release can be found in the Risk Factors section of Treace’s public filings with the Securities and Exchange Commission (SEC), including in the final prospectus filed with the SEC on April 26, 2021 in connection with Treace’s initial public offering. Because forward-looking statements are inherently subject to risks and uncertainties, you should not rely on these forward-looking statements as predictions of future events. These forward-looking statements speak only as of their date and, except to the extent required by law, the Company undertakes no obligation to update these statements, whether as a result of any new information, future developments or otherwise. The Company’s results for the quarter ended September 30, 2021 are not necessarily indicative of our operating results for any future periods.

About Treace Medical Concepts

Treace Medical Concepts, Inc. is a commercial-stage orthopaedic medical device company with the goal of advancing the standard of care for the surgical management of bunion deformities and related midfoot correction. Bunions are complex 3-dimensional deformities that originate from an unstable joint in the middle of the foot. Treace has pioneered and patented the Lapiplasty® 3D Bunion Correction™ System - a combination of instruments, implants, and surgical methods designed to correct all 3 planes of the bunion deformity and secure the unstable joint, addressing the root cause of the bunion and helping patients get back to their active lifestyles. Treace recently expanded its offering with the Adductoplasty™ Midfoot Correction System, designed for reproducible correction of the midfoot which could provide further support to hallux valgus patients.


Treace Medical Concepts
Mark L. Hair
Chief Financial Officer 
(904) 373-5940


Gilmartin Group
Lynn Lewis or Vivian Cervantes 

Treace Medical Concepts, Inc.
Condensed Statements of Operations and Comprehensive Loss
(in thousands, except share and per share amounts)

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
  2021  2020  2021  2020 
Revenue $21,619  $14,266  $60,980  $33,260 
Cost of goods sold  4,248   2,911   11,519   7,386 
Gross profit  17,371   11,355   49,461   25,874 
Operating expenses                
Sales and marketing  15,984   8,103   42,142   20,229 
Research and development  2,537   1,511   6,827   3,925 
General and administrative  4,310   1,804   11,405   4,500 
Total operating expenses  22,831   11,418   60,374   28,654 
Loss from operations  (5,460)  (63)  (10,913)  (2,780)
Interest and other income (expense), net  5   (1,784)  12   (1,748)
Interest expense  (963)  (808)  (3,032)  (1,707)
Other expense, net  (958)  (2,592)  (3,020)  (3,455)
Net loss and comprehensive loss  (6,418)  (2,655)  (13,933)  (6,235)
Convertible preferred stock cumulative and undeclared
     (161)  (196)  (479)
Net loss attributable to common stockholders $(6,418) $(2,816) $(14,129) $(6,714)
Net loss per share attributable to common stockholders,
basic and diluted
 $(0.12) $(0.08) $(0.30) $(0.18)
Weighted-average shares used in computing net
loss per share attributable to common stockholders,
basic and diluted
  52,766,150   37,069,294   46,603,487   37,063,446 

Treace Medical Concepts, Inc.
Condensed Balance Sheets
(in thousands, except share and per share amounts)

  September 30,  December 31, 
  2021  2020 
Current assets        
Cash and cash equivalents $109,459  $18,079 
Accounts receivable, net of allowance for doubtful accounts of $282 and
$446 as of September 30, 2021 and December 31, 2020, respectively
  11,795   14,486 
Inventories  10,351   7,820 
Prepaid expenses and other current assets  3,760   593 
Total current assets  135,365   40,978 
Property and equipment, net  2,225   829 
Total assets $137,590  $41,807 
Liabilities and Stockholders’ Equity        
Current liabilities        
Accounts payable $2,442  $2,265 
Accrued liabilities  2,824   1,848 
Accrued commissions  3,021   3,513 
Accrued compensation  2,436   2,183 
Short-term debt  -   1,788 
Total current liabilities  10,723   11,597 
Derivative liability on term loan  173   245 
Long-term debt, net of discount of $679 and $811 as of September 30, 2021 and
December 31, 2020, respectively
  29,321   29,189 
Total liabilities  40,217   41,031 
Commitments and contingencies        
Stockholders’ equity        
Series A convertible preferred stock, $0.001 par value, 0 shares authorized and 0 shares issued and outstanding as of September 30, 2021; 6,687,500 shares authorized and 6,687,475 shares issued and outstanding as of December 31, 2020, respectively; liquidation value of $0 and $8,000 as of September 30, 2021 and December 31, 2020, respectively     7,935 
Preferred stock, $0.001 par value, 5,000,000 shares authorized; 0 shares issued and outstanding as of September 30, 2021; 0 shares authorized, issued and outstanding as of December 31, 2020      
Common stock, $0.001 par value, 300,000,000 shares authorized; 52,772,969 issued and outstanding as of September 30, 2021; 66,875,000 shares authorized, 37,366,865 issued and outstanding as of December 31, 2020 45  28 
Common stock Class B, $0.001 par value, 0 shares authorized, issued and outstanding as of September 30, 2021; 1,000,000 shares authorized and 0 shares issued and outstanding as of December 31, 2020      
Additional paid-in capital  132,614   14,166 
Accumulated deficit  (35,286)  (21,353)
Total stockholders’ equity  97,373   776 
Total liabilities and stockholders’ equity $137,590  $41,807 

Treace Medical Concepts, Inc.
Condensed Statements of Cash Flows
(in thousands)

  Nine Months Ended September 30,  Nine Months Ended September 30, 
  2021  2020 
Cash flows from operating activities        
Net loss $(13,933) $(6,235)
Adjustments to reconcile net loss to net cash used in operating activities        
Depreciation and amortization expense  409   1,002 
(Recovery) Provision for allowance for doubtful accounts  (56)  212 
Share-based compensation expense  2,116   582 
Amortization of debt issuance costs  133   168 
Gain on fair value adjustment to derivative liability  (72)   
Provision for inventory obsolescence  179   528 
Loss on early settlement of debt     639 
Net changes in operating assets and liabilities:        
Accounts Receivable  2,747   765 
Inventory  (2,710)  (4,740)
Prepaid expenses and other assets  (3,168)  (138)
Accounts payable  177   2,142 
Accrued liabilities  737   (1,867)
Net cash used in operating activities  (13,441)  (6,942)
Cash flows from investing activities        
Purchases of property and equipment  (1,805)  (981)
Net cash used in investing activities  (1,805)  (981)
Cash flows from financing activities        
Proceeds from interest bearing debt     29,530 
Payments on interest bearing debt     (20,000)
Proceeds from SBA Loan     1,788 
Repayments on SBA Loan  (1,788)   
Proceeds from issuance of common stock upon initial public offering, net of issuance costs and underwriting fees of $10.6 million  107,610    
Debt issuance costs     (179)
Proceeds from exercise of employee stock options  804   41 
Net cash provided by financing activities  106,626   11,180 
Net increase in cash and cash equivalents  91,380   3,257 
Cash and cash equivalents at beginning of period  18,079   12,139 
Cash and cash equivalents at end of period $109,459  $15,396 
Supplemental disclosure of cash flow information:        
Cash paid for interest  2,917   1,146 
Issuance of common stock upon exercise of warrants  1    
Conversion of convertible preferred stock and accrued dividends on convertible preferred stock into common stock  7,935    

Treace Medical Concepts, Inc.
Reconciliation of GAAP Net Loss to Adjusted EBITDA

  Three Months Ended
September 30,
 Nine Months Ended
September 30,
   2021   2020   2021   2020 
Net loss $
Interest $







Taxes $








Depreciation & Amortization $






Non-cash compensation expense $







Adjusted EBITDA $