Tactile Systems Technology, Inc. Reports Preliminary First Quarter 2020 Revenue Results, Withdraws Full Year 2020 Financial Outlook and Provides COVID-19 Business Update

Preliminary First Quarter Revenue Increased 14% to 17% Year-Over-Year; 24% to 27% Year-Over-Year on an Operational Basis

MINNEAPOLIS, April 06, 2020 (GLOBE NEWSWIRE) -- Tactile Systems Technology, Inc. (“Tactile Medical”) (Nasdaq: TCMD), a medical technology company focused on developing medical devices for the at-home treatment of chronic diseases, today reported preliminary revenue results for the first quarter ended March 31, 2020, withdrew its 2020 financial outlook and provided a business update on the Company’s response to the COVID-19 pandemic.

First Quarter 2020 Preliminary Revenue Summary:

• First quarter 2020 preliminary total revenue is expected to be in the range of $43.0 million to $44.0 million, representing growth of approximately 14% to 17% year-over-year. First quarter 2020 total revenue was negatively impacted by the COVID-19 pandemic beginning in the month of March.
   
  --  Excluding the contribution to first quarter 2019 revenue related to the Company’s adoption of ASC 842, the first quarter 2020 expected revenue range reflects year-over-year growth of approximately 24% to 27% on an operational basis

• First quarter 2020 preliminary revenue is expected to be comprised of:
  
  --  Flexitouch system revenue in the range of $38.0 million to $39.0 million, representing growth of approximately 11% to 14% year-over-year
  
  --  Other revenue in the range of $5.0 million to $5.1 million, representing growth of approximately 43% to 45% year-over-year

Full Year 2020 Financial Outlook:

• Due to the rapidly evolving environment and continued uncertainties associated with COVID-19, the Company is withdrawing its full year 2020 financial outlook. The Company intends to provide additional information on the impact of COVID-19, to the extent practicable, during its first quarter earnings call scheduled for Monday, May 4, 2020.

• At December 31, 2019, the Company had approximately $45.2 million of cash, cash equivalents and marketable securities. As of April 6, 2020, the Company had no outstanding borrowings on its $10.0 million revolving credit facility.

“We are grateful to the healthcare professionals who are tirelessly caring for patients on the front lines of this pandemic, and our thoughts go out to all who have been impacted,” said Gerald R. Mattys, Chief Executive Officer of Tactile Medical. “During this challenging time, we have proactively implemented multiple initiatives to support our clinicians, patients, and employees. In the first quarter of 2020, we achieved strong revenue growth of 14% to 17% on a reported basis, and 24% to 27% on an operational basis, due in part to increasing awareness of our products in treating patients at home, as our Flexitouch system has been shown to reduce hospitalizations. Our revenue in the first two months of the year was ahead of our expectations. Beginning in March, our revenue growth was impacted by the COVID-19 pandemic, which disrupted our ability to access our clinician customers and their patients. Specifically, we saw healthcare facilities and clinics restricting access to their clinicians, reducing patient consultations and treatments, or closing temporarily due to COVID-19. As a direct result, we have changed many of our processes and practices in an effort to help mitigate the impact of COVID-19 on our business so that we can seamlessly support our clinicians and safely make our at-home therapies available for patients.”