MAKO Surgical Corp. Q2 2008 Earnings Call Transcript

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2008-07-29 16:56:13.0

Tags: Mako, Call Transcript, Earnings, Morgan Stanley, Research & Development, Operational Accounting, Business Operations, Finance, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions). We'll go first to David Roman with Morgan Stanley.

David Roman - Morgan Stanley

Good evening, everyone. Thank you for taking the question. Just a couple of things, firstly on the P&L, Fritz, can you give us a breakdown of what revenue was between procedures and other?

Fritz LaPorte

Sure. The total revenue for the quarter was $704,000 of which $579,000 was from products, which is generated from our MAKOplasty procedures and $125,000 was other. For the six months ending June 30, it was $1.2 million in total revenue of which $993,000 was generated from products and $208,000 was generated from other.

David Roman - Morgan Stanley

And then on the P&L, both in SG&A and R&D, we saw a pretty big sequential step down in absolute dollars. Is that to do with timing of specific projects or is that a more normalized run rate we should be looking at now?

Fritz LaPorte

I'm sorry, David, you said which categories?

David Roman - Morgan Stanley

In R&D we saw versus the first quarter a pretty big step down in absolute dollars.

Fritz LaPorte

Right. So in R&D, if you recall, we had approximately $950,000, almost $1 million, in the first quarter associated with a non-recurring stock-based expenses associated with some consultants.

David Roman - Morgan Stanley

Okay. And then, lastly, the ASP is a little higher I think on the systems that you've been talking about. Is that consistent across all three systems or have we seen prices go up throughout the quarter?

Fritz LaPorte

The average ASP for the quarter was about $659,000 and I think that's a good average. They are all coming in right around that.

David Roman - Morgan Stanley

Okay. Thank you very much.

Fritz LaPorte

You are welcome.

Maurice Ferré

Thank you, David.

Operator

And we'll go next to Eli Kammerman with Cowen.

Eli Kammerman - Cowen

Good afternoon.

Fritz LaPorte

Good afternoon, Eli.

Maurice Ferré

Good afternoon, Eli.

Eli Kammerman - Cowen

First question is, now that you've got the President Elect of the AAOS as one of your key users, do you feel like you're getting closer to an endorsement by the Knee Society itself. And if so, when might we expect such an endorsement?

Maurice Ferré

Eli, good afternoon, first of all. We are very pleased not only to have the President Elect, Dr. Joseph Zuckerman over at NYU and his team embracing the MAKO technology and I think they are going to be a super site for us in the New York area, we are very excited to have them. And we have one of the exciting things about that site is that we're seeing not just one surgeon, but multiple surgeons showing a lot of interest of being able to use the system. And that, obviously, is something that's going to be very exciting as we look through and as we see this going forward. But we also this quarter have got the very visible Dr. Larry Dorr who is a giant in our industry and has also been part of the Hip and Knee Society.

 

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