Merit Medical Reports Results for Third Quarter 2017

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| Source: Merit Medical Systems, Inc.
  • Q3 2017 worldwide revenue of $179.3 million ($178.3 million on a comparable, constant currency* basis), up 14.2% as reported (up 13.6% on a comparable, constant currency* basis) over Q3 2016
  • YTD 2017 worldwide revenue of $537.0 million ($539.1 million on a comparable, constant currency* basis), up 20.4% as reported (up 20.8% on a comparable, constant currency* basis) over the same period in 2016
  • Q3 2017 core revenue* up 5.1% over Q3 2016 core revenue* (core revenue* up 4.5% on a comparable, constant currency* basis); YTD 2017 core revenue* up 8.6% over core revenue* for the same period of 2016 (core revenue* up 8.9% on a comparable, constant currency* basis)
  • Q3 2017 GAAP EPS was a loss of $(0.07), compared to income of $0.02 in Q3 2016; Q3 2017 non-GAAP EPS* was $0.32, compared to $0.26 in Q3 2016
  • Q3 2017 GAAP gross margin was 44.9%, compared to 43.2% in Q3 2016; Q3 2017 non-GAAP gross margin* was 48.1%, compared to 46.8% for Q3 2016

* Non-GAAP net income, non-GAAP EPS, constant currency revenue, core revenue, core revenue on a constant currency basis and non-GAAP gross margin are non-GAAP financial measures. A reconciliation of these and other non-GAAP financial measures used in this release to their most directly comparable GAAP financial measure is included under the heading “Non-GAAP Financial Measures” below.

SOUTH JORDAN, Utah, Oct. 25, 2017 (GLOBE NEWSWIRE) -- Merit Medical Systems, Inc. (NASDAQ:MMSI), a leading manufacturer and marketer of proprietary disposable devices used in interventional, diagnostic and therapeutic procedures, particularly in cardiology, radiology, oncology, critical care and endoscopy, today announced revenue of $179.3 million for the quarter ended September 30, 2017, an increase of 14.2% over revenue of $157.0 million for the quarter ended September 30, 2016. On a comparable, constant currency* basis, revenue for the third quarter of 2017 would have been up 13.6% over revenue for the comparable quarter of 2016. For the nine months ended September 30, 2017, revenue was $537.0 million, up 20.4% compared to revenue of $446.1 million for the nine months ended September 30, 2016. On a comparable, constant currency* basis, revenue for the nine months ended September 30, 2017 would have been up 20.8% over revenue for the comparable period of 2016.

Merit’s GAAP net loss for the third quarter of 2017 was $(3.6) million, or $(0.07) per share, compared to net income of $1.0 million, or $0.02 per share, for the third quarter of 2016. During the third quarter of 2017, Merit made investments in intellectual property of approximately $12.1 million as part of asset and equity acquisitions which were recorded as acquired in-process research and development expense. Merit also recognized a reduction of $778,000 to the gain on bargain purchase related to the acquisition of the critical care business of Argon Medical Devices, Inc. earlier in the year. Merit’s non-GAAP net income* for the quarter ended September 30, 2017 was $16.5 million, or $0.32 per share, compared to $11.5 million, or $0.26 per share, for the quarter ended September 30, 2016.

Merit’s GAAP net income for the nine months ended September 30, 2017 was $20.7 million, or $0.42 per share, compared to $12.6 million, or $0.28 per share, for the nine months ended September 30, 2016. Merit’s non-GAAP net income* for the nine months ended September 30, 2017 was $47.4 million, or $0.96 per share, compared to $31.4 million, or $0.70 per share, for the nine months ended September 30, 2016.

Merit’s revenue by category for the three and nine-month periods ended September 30, 2017, compared to the corresponding periods in 2016, was as follows:

   Three Months Ended   Nine Months Ended
   September 30,   September 30,
 % Change 2017 2016 % Change 2017 2016
Cardiovascular           
Stand-alone devices34.2% $68,724  $51,195  45.6% $203,434  $139,729 
Custom kits and procedure trays0.7% 30,436  30,223  2.2% 91,107  89,164 
Inflation devices9.0% 20,033  18,371  8.3% 59,329  54,774 
Catheters5.3% 31,751  30,139  12.2% 94,357  84,078 
Embolization devices9.3% 12,252  11,207  8.8% 36,936  33,937 
CRM/EP1.7% 9,527  9,368  18.9% 31,977  26,889 
Total14.8% 172,723  150,503  20.7% 517,140  428,571 
            
Endoscopy           
Endoscopy devices2.2% 6,614  6,472  12.9% 19,815  17,552 
            
Total14.2% $179,337  $156,975  20.4% $536,955  $446,123 
                      

Note: Certain revenue categories for 2016 have been adjusted to reflect changes in product classifications to be consistent with updates in the management of Merit's product portfolios in 2017.

“Despite challenges with the general conditions of summer selling, the company delivered earnings above expectations which demonstrates both our commitment and discipline to our financial and operating plan, which, except as discussed below, we are confirming for the balance of this year, as well as our announced plans for 2018 and 2019,” said Fred P. Lampropoulos, Merit’s Chairman and Chief Executive Officer. “Recently, we made four strategic tuck-in acquisitions. The first, the assets we acquired from Laurane Medical, add additional bone biopsy technology to our biopsy portfolio. Second, we acquired the assets of Osseon, which adds products and technology to our vertebral augmentation and kyphoplasty portfolio. The products and technologies acquired in these two transactions will be manufactured at our facility in Ireland as we scale both of these businesses.”

“Third is the acquisition of IntelliMedical Technologies in Melbourne, Australia. IntelliMedical is an early-stage company which has developed technology designed to use magnets and Bluetooth® technology to steer guide wires remotely. This follows a number of new products, such as the SwiftNINJA® Steerable Microcatheter and the HeartSpan® Steerable Sheath, which provide improved accuracy and speed during procedures,” Lampropoulos said. “This technology will require further development, but it provides an important base for this and future technologies in this expanding and exciting area. The R&D cost of commercializing the technology is budgeted within our existing committed structure of R&D spending."

“Finally, in the first few days of October, we acquired ITL Healthcare, a custom procedure pack business based in Melbourne, Australia, which we believe will allow us to leverage the infrastructure we have established in Australia," Lampropoulos said.

2017 Guidance
Due to the impact of the in-process research and development charge attributable to the IntelliMedical acquisition completed in the third quarter, Merit is updating its 2017 GAAP EPS guidance. Merit estimates that for the year ending December 31, 2017, absent material acquisitions or non-recurring transactions, Merit's GAAP EPS will be in the range of $0.55 - $0.61, down from $0.80 - $0.86. Merit reaffirms its guidance previously issued for the year ended December 31, 2017 of revenues in the range of $722 - $727 million, GAAP gross margin of 45.0% - 45.5%, non-GAAP gross margin* of 48.0% - 48.5%, and non-GAAP EPS* in the range of $1.23 - $1.28. Merit’s financial guidance for the year ending December 31, 2017 is subject to risks and uncertainties identified in Merit’s press releases, public statements and public filings.

CONFERENCE CALL

Merit will hold its investor conference call (conference ID 96826880) today, Wednesday, October 25, 2017, at 5:00 p.m. Eastern (4:00 p.m. Central, 3:00 p.m. Mountain, and 2:00 p.m. Pacific). The domestic telephone number is (844) 578-9672 and the international number is (508) 637-5656. A live webcast and slide deck will also be available at merit.com.

    
CONSOLIDATED BALANCE SHEETS   
(In thousands)   
 September 30, December 31,
 2017 2016
 (Unaudited)  
ASSETS   
Current Assets   
  Cash and cash equivalents$23,362  $19,171 
  Trade receivables, net101,394  80,521 
  Employee receivables147  198 
  Other receivables5,900  5,445 
  Inventories145,598  120,695 
  Prepaid expenses and other assets20,581  6,226 
  Prepaid income taxes2,792  2,525 
  Deferred income tax assets  8,219 
  Income tax refunds receivable91  423 
  Total Current Assets299,865  243,423 
    
 Property and equipment, net290,282  276,573 
 Intangibles, net228,503  182,697 
 Goodwill234,043  211,927 
 Deferred income tax assets2,046  171 
 Other assets32,412  28,012 
Total Assets$1,087,151  $942,803 
    
LIABILITIES AND STOCKHOLDERS' EQUITY   
Current Liabilities   
  Trade payables$32,291  $30,619 
  Accrued expenses56,508  44,947 
  Current portion of long-term debt16,962  10,000 
  Advances from employees542  572 
  Income taxes payable1,435  2,193 
  Total Current Liabilities107,738  88,331 
    
Deferred income tax liabilities23,764  25,981 
Liabilities related to unrecognized tax benefits438  438 
Deferred compensation payable10,319  9,211 
Deferred credits2,439  2,550 
Long-term debt260,978  314,373 
Other long-term obligations14,659  3,730 
  Total Liabilities420,335  444,614 
    
Stockholders' Equity   
  Common stock351,321  206,186 
  Retained earnings314,602  293,885 
  Accumulated other comprehensive income (loss)893  (1,882)
  Total stockholders' equity666,816  498,189 
Total Liabilities and Stockholders' Equity$1,087,151  $942,803 
        


CONSOLIDATED STATEMENTS OF INCOME       
(Unaudited, in thousands except per share amounts)      
       
 Three Months Ended Nine Months Ended
 September 30, September 30,
 2017 2016 2017 2016
        
SALES$179,337  $156,975  $536,955  $446,123 
        
COST OF SALES98,823  89,160  296,358  251,354 
        
GROSS PROFIT80,514  67,815  240,597  194,769 
        
OPERATING EXPENSES       
  Selling, general and administrative54,716  53,198  169,896  138,556 
  Research and development12,838  11,424  38,676  33,440 
  Acquired in-process research and development12,061  300  12,136  400 
  Contingent consideration expense (benefit)20  (94) 39  99 
  Total79,635  64,828  220,747  172,495 
        
INCOME FROM OPERATIONS879  2,987  19,850  22,274 
        
OTHER INCOME (EXPENSE)       
  Interest income94  29  266  55 
  Interest expense(1,590) (3,022) (5,935) (6,120)
  Gain on bargain purchase(778)   10,796   
  Other income (expense) - net(810) 1  (376) (445)
  Total other income (expense) - net(3,084) (2,992) 4,751  (6,510)
        
INCOME (LOSS) BEFORE INCOME TAXES(2,205) (5) 24,601  15,764 
        
INCOME TAX EXPENSE (BENEFIT)1,364  (978) 3,884  3,149 
        
NET INCOME (LOSS)$(3,569) $973  $20,717  $12,615 
        
EARNINGS PER COMMON SHARE-       
  Basic$(0.07) $0.02  $0.43  $0.28 
        
  Diluted$(0.07) $0.02  $0.42  $0.28 
        
AVERAGE COMMON SHARES-       
  Basic50,150  44,447  48,332  44,346 
        
  Diluted51,599  45,000  49,555  44,763 
            


Non-GAAP Financial Measures
Although Merit’s financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), Merit’s management believes that certain non-GAAP financial measures referred to in this release provide investors with useful information regarding the underlying business trends and performance of Merit’s ongoing operations and can be useful for period-over-period comparisons of such operations. Non-GAAP financial measures used in this release include:
•         constant currency revenue;
•         core revenue;
•         core revenue on a constant currency basis;
•         non-GAAP earnings per share;
•         non-GAAP gross margin; and
•         non-GAAP net income.

Merit’s management team uses these non-GAAP financial measures to evaluate Merit’s profitability and efficiency, to compare operating results to prior periods, to evaluate changes in the operating results of its operating segments, and to measure and allocate financial resources internally. However, Merit’s management does not consider such non-GAAP measures in isolation or as an alternative to such measures determined in accordance with GAAP.

Readers should consider non-GAAP measures used in this release in addition to, not as a substitute for, financial reporting measures prepared in accordance with GAAP. These non-GAAP financial measures generally exclude some, but not all, items that may affect Merit's net income. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which items are excluded. Merit believes it is useful to exclude such items in the calculation of non-GAAP earnings per share, non-GAAP gross margin and non-GAAP net income (in each case, as further illustrated in the reconciliation table below) because such amounts in any specific period may not directly correlate to the underlying performance of Merit’s business operations and can vary significantly between periods as a result of factors such as new acquisitions, non-cash expenses related to amortization of previously acquired tangible and intangible assets, unusual compensation expenses or expenses resulting from litigation or governmental proceedings. Merit may incur similar types of expenses in the future, and the non-GAAP financial information included in this release should not be viewed as a statement or indication that these types of expenses will not recur. Additionally, the non-GAAP financial measures used in this release may not be comparable with similarly titled measures of other companies. Merit urges investors and potential investors to review the reconciliations of its non-GAAP financial measures to the comparable GAAP financial measures, and not to rely on any single financial measure to evaluate Merit’s business or results of operations.

Constant Currency Revenue
Merit’s revenue on a constant currency basis is prepared by translating the current-period reported revenue of subsidiaries whose functional currency is other than the U.S. dollar at the applicable foreign exchange rates in effect during the comparable prior-year period. The constant currency revenue adjustments of $(1.0) million and $2.1 million for the three and nine-month periods ended September 30, 2017, respectively, were calculated using the applicable average foreign exchange rates for the three and nine-month periods ended September 30, 2016, respectively.

Core Revenue and Core Revenue on a Constant Currency Basis
Merit’s core revenue is defined as reported revenue excluding revenues from the acquisitions of the HeRO® Graft (excluded January 2017 only), DFINE, Inc. (through June) in 2016, Catheter Connections, Inc. and the critical care division of Argon Medical Devices, Inc. in January 2017, Osseon LLC in July 2017, and Laurane Medical S.A.S. in August 2017. Core revenue on a constant currency basis is defined as core revenue plus the foreign exchange impact related to those core sales, using the applicable foreign exchange rates in effect for the comparable prior-year periods presented.

Non-GAAP Gross Margin
Non-GAAP gross margin is calculated by reducing GAAP cost of sales by amounts recorded for amortization of intangible assets, inventory mark-up related to acquisitions and severance.

Non-GAAP Net Income
Non-GAAP net income is calculated by adjusting GAAP net income for certain items which are deemed by Merit’s management to be outside of core operations and vary in amount and frequency among periods, such as expenses related to new acquisitions, non-cash expenses related to amortization of previously acquired tangible and intangible assets, unusual compensation expenses or expenses resulting from litigation or governmental proceedings, as well as other items set forth in the table below.

Non-GAAP EPS
Non-GAAP EPS is defined as non-GAAP net income divided by the diluted shares outstanding for the corresponding period.

Other Non-GAAP Financial Measure Reconciliation

The following table sets forth supplemental financial data and corresponding reconciliations of non-GAAP net income and non-GAAP earnings per share to Merit’s net income and earnings per share prepared in accordance with GAAP for the three and nine-month periods ended September 30, 2017 and 2016. The non-GAAP income adjustments referenced in the following table do not reflect stock-based compensation expense of approximately $1.2 million and $0.5 million for the three-month periods ended September 30, 2017 and 2016, respectively, and approximately $2.9 million and $1.9 million for the nine-month periods ended September 30, 2017 and 2016, respectively.

    
Reconciliation of GAAP Net Income to Non-GAAP Net Income   
(Unaudited, in thousands except per share amounts)    
 Three Months Ended
 September 30, 2017
 Pre-TaxTax Impact (a)After-TaxPer Share Impact
GAAP net income$(2,205)$(1,364)$(3,569)$(0.07)
     
Non-GAAP adjustments:    
Cost of Sales    
Amortization of intangibles5,472 (2,056)3,416 0.07 
Inventory mark-up related to acquisitions242 (94)148  
Selling, General and Administrative    
Severance396 (154)242  
Acquisition-related (b)1,729 (666)1,063 0.02 
Fair value adjustment to contingent consideration (c)20 (8)12  
Long-term asset impairment charge (d)67 (26)41  
Acquired in-process research and development12,061 (68)11,993 0.23 
Amortization of intangibles1,530 (591)939 0.02 
Special legal expense (e)2,118 (824)1,294 0.03 
Other (Income) Expense    
Gain on bargain purchase (f)778  778 0.02 
Amortization of long-term debt issuance costs171 (67)104  
     
Non-GAAP net income$22,379 $(5,918)$16,461 $0.32 
     
Diluted shares   51,599 
     
 Three Months Ended
 September 30, 2016
 Pre-TaxTax Impact (a)After-TaxPer Share Impact
GAAP net income$(5)$978 $973 $0.02 
     
Non-GAAP adjustments:    
Cost of Sales    
Amortization of intangibles4,446 (1,653)2,793 0.06 
Inventory mark-up related to acquisitions1,202 (468)734 0.02 
Severance56 (22)34  
Selling, General and Administrative    
Severance7,644 (2,840)4,804 0.11 
Acquisition-related (b)1,377 (231)1,146 0.03 
Fair value adjustment to contingent consideration (c)(94)37 (57) 
Acquired in-process research and development300 (117)183  
Amortization of intangibles1,224 (469)755 0.02 
Other (Income) Expense    
Amortization of long-term debt issuance costs258 (101)157  
     
Non-GAAP net income$16,408 $(4,886)$11,522 $0.26 
     
Diluted shares   45,000 


    
Reconciliation of GAAP Net Income to Non-GAAP Net Income   
(Unaudited, in thousands except per share amounts)    
 Nine Months Ended
 September 30, 2017
 Pre-TaxTax Impact (a)After-TaxPer Share Impact
GAAP net income$24,601 $(3,884)$20,717 $0.42 
     
Non-GAAP adjustments:    
Cost of Sales    
Amortization of intangibles15,215 (5,702)9,513 0.19 
Inventory mark-up related to acquisitions3,121 (1,214)1,907 0.04 
Selling, General and Administrative    
Severance1,740 (677)1,063 0.02 
Acquisition-related (b)5,017 (1,501)3,516 0.07 
Fair value adjustment to contingent consideration (c)39 (15)24  
Long-term asset impairment charge (d)86 (33)53  
Acquired in-process research and development12,136 (97)12,039 0.25 
Amortization of intangibles4,202 (1,621)2,581 0.05 
Special legal expense (e)10,615 (4,129)6,486 0.13 
Other (Income) Expense    
Gain on bargain purchase (f)(10,796) (10,796)(0.22)
Amortization of long-term debt issuance costs514 (200)314 0.01 
     
Non-GAAP net income$66,490 $(19,073)$47,417 $0.96 
     
Diluted shares   49,555 
     
 Nine Months Ended
 September 30, 2016
 Pre-TaxTax Impact (a)After-TaxPer Share Impact
GAAP net income$15,764 $(3,149)$12,615 $0.28 
     
Non-GAAP adjustments:    
Cost of Sales    
Amortization of intangibles10,688 (3,939)6,749 0.15 
Inventory mark-up related to acquisitions1,409 (548)861 0.02 
Severance56 (22)34  
Selling, General and Administrative    
Severance9,422 (3,532)5,890 0.13 
Acquisition-related (b)3,750 (1,154)2,596 0.06 
Fair value adjustment to contingent consideration (c)99 (38)61  
Long-term asset impairment charge (d)88 (34)54  
Acquired in-process research and development400 (156)244 0.01 
Amortization of intangibles2,869 (1,096)1,773 0.04 
Other (Income) Expense    
Amortization of long-term debt issuance costs779 (303)476 0.01 
     
Non-GAAP net income$45,324 $(13,971)$31,353 $0.70 
     
Diluted shares   44,763 
      
(a) Reflects the tax effect associated with pre-tax income and the non-GAAP adjustments
(b) Represents costs related to acquisitions
(c) Represents changes in the fair value of contingent consideration liabilities and contingent receivables as a result of acquisitions
(d) Represents abandoned patents
(e) Costs incurred in responding to an inquiry from the U.S. Department of Justice
(f) Represents the gain on bargain purchase realized from the acquisition of the critical care division of Argon Medical Devices, Inc.
 


Reconciliation of Reported Revenue to Core Revenue (Non-GAAP), Constant Currency Revenue (Non-GAAP),
and Core Revenue on a Constant Currency Basis (Non-GAAP)  
(Unaudited, in thousands)       
  Three Months Ended  Nine Months Ended
  September 30,  September 30,
 % Change20172016 % Change20172016
Reported Revenue14.2%$179,337 $156,975  20.4%$536,955 $446,123 
        
Add: Impact of foreign exchange (a) (1,033)   2,139  
        
Constant Currency Revenue13.6%$178,304 $156,975  20.8%$539,094 $446,123 
        
        
  Three Months Ended  Nine Months Ended
  September 30,  September 30,
 % Change20172016 % Change20172016
Reported Revenue14.2%$179,337 $156,975  20.4%$536,955 $446,123 
        
Less: Revenue from certain acquisitions (b) (14,360)   (52,586) 
        
Core Revenue5.1%$164,977 $156,975  8.6%$484,369 $446,123 
        
Add: Impact of foreign exchange on core revenue (a) (969)   1,677  
        
Core revenue on a constant currency basis4.5%$164,008 $156,975  8.9%$486,046 $446,123 

(a) The constant currency revenue adjustments of $(1.0) million and $2.1 million to reported revenue, as well as the constant currency adjustments of $(1.0) million and $1.7 million to core revenue, for the three and nine-month periods ended September 30, 2017, respectively, were calculated using the applicable average foreign exchange rates for the three and nine-month periods ended September 30, 2016, respectively.

(b) Represents revenue from the acquisitions of the HeRO Graft in February 2016 (excluding January 2017 revenue); DFINE, Inc. (through June) in July 2016; the assets of Catheter Connections, Inc. in January 2017; the critical care division of Argon Medical Devices, Inc. in January 2017, Osseon LLC in July 2017; Laurane Medical S.A.S. in August 2017.


Reconciliation of Reported Gross Margin to Non-GAAP Gross Margin (Non-GAAP) 
(Unaudited, in thousands)     
(As a percentage of reported revenue)     
      
 Three months ended Nine months ended
 September 30, September 30,
 20172016 20172016
Reported Gross Margin44.9%43.2% 44.8%43.7%
      
Add back impact of:     
Amortization of intangibles3.1%2.8% 2.8%2.4%
Inventory mark-up related to acquisitions0.1%0.8% 0.6%0.3%
      
Non-GAAP Gross Margin48.1%46.8% 48.2%46.4%


ABOUT MERIT
Founded in 1987, Merit Medical Systems, Inc. is engaged in the development, manufacture and distribution of proprietary disposable medical devices used in interventional, diagnostic and therapeutic procedures, particularly in cardiology, radiology and endoscopy. Merit serves client hospitals worldwide with a domestic and international sales force totaling approximately 290 individuals. Merit employs approximately 4,700 people worldwide with facilities in South Jordan, Utah; Pearland, Texas; Richmond, Virginia; Malvern, Pennsylvania; Rockland, Massachusetts; San Jose, California; Maastricht and Venlo, The Netherlands; Paris, France; Galway, Ireland; Beijing, China; Tijuana, Mexico; Joinville, Brazil; Markham, Ontario, Canada; Melbourne, Australia; Tokyo, Japan; and Yishun, Singapore.

FORWARD-LOOKING STATEMENTS
Statements contained in this release which are not purely historical, including, without limitation, statements regarding Merit's forecasted plans, revenues, net income, financial results or anticipated or completed acquisitions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to risks and uncertainties such as those described in Merit's Annual Report on Form 10-K for the year ended December 31, 2016 and subsequent filings with the Securities and Exchange Commission. Such risks and uncertainties include risks relating to Merit's potential inability to successfully manage growth through acquisitions, including the inability to commercialize technology acquired through completed, proposed or future transactions; product recalls and product liability claims; expenditures relating to research, development, testing and regulatory approval or clearance of Merit's products and risks that such products may not be developed successfully or approved for commercial use; governmental scrutiny and regulation of the medical device industry, including governmental inquiries, investigations and proceedings involving Merit; reforms to the 510(k) process administered by the U.S. Food and Drug Administration; restrictions on Merit's liquidity or business operations resulting from its current debt agreements; infringement of Merit's technology or the assertion that Merit's technology infringes the rights of other parties; the potential of fines, penalties or other adverse consequences if Merit's employees or agents violate the U.S. Foreign Corrupt Practices Act or other laws or regulations; laws and regulations targeting fraud and abuse in the healthcare industry; potential for significant adverse changes in governing regulations; changes in tax laws and regulations in the United States or other countries; increases in the prices of commodity components; negative changes in economic and industry conditions in the United States or other countries; termination or interruption of relationships with Merit's suppliers, or failure of such suppliers to perform; fluctuations in exchange rates; concentration of a substantial portion of Merit's revenues among a few products and procedures; development of new products and technology that could render Merit's existing products obsolete; market acceptance of new products; volatility in the market price of Merit's common stock; modification or limitation of governmental or private insurance reimbursement policies; changes in healthcare policies or markets related to healthcare reform initiatives; failure to comply with applicable environmental laws; changes in key personnel; work stoppage or transportation risks; introduction of products in a timely fashion; price and product competition; availability of labor and materials; fluctuations in and obsolescence of inventory; and other factors referred to in Merit's Annual Report on Form 10-K for the year ended December 31, 2016 and other materials filed with the Securities and Exchange Commission. All subsequent forward-looking statements attributable to Merit or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. Actual results will likely differ, and may differ materially, from anticipated results. Financial estimates are subject to change and are not intended to be relied upon as predictions of future operating results, and Merit assumes no obligation to update or disclose revisions to those estimates.

TRADEMARKS
Unless noted otherwise, trademarks and registered trademarks used in this release are the property of Merit Medical Systems, Inc., in the United States and other jurisdictions.

Contact:  Anne-Marie Wright, Vice President, Corporate Communications
Phone:  (801) 208-4167  e-mail: awright@merit.com  Fax: (801) 253-1688