EX-99.2 3 ex-99d2.htm EX-99.2 TCMD EX 99-2

Exhibit 99.2

TACTILE SYSTEMS TECHNOLOGY, INC.

May 6, 2019

As a result of our adoption of Accounting Standards Update No. 2016-02, “Leases” (Topic 842), beginning with the three months ended March 31, 2019, rental revenue, cost of rental revenue and gross profit - rental revenue are presented as line items separate from sales revenue, cost of sales revenue and gross profit - sales revenue, respectively, in our consolidated financial statements.  Our adoption of ASC 842 under the modified retrospective transition approach did not require restatement of previous periods, but in order to provide comparable information regarding the components of these line items in prior periods, the following supplemental financial information details the composition of our previously-reported total revenue, total cost of revenue and gross profit results into revenue from sales and revenue from rentals, the corresponding cost of revenue for sales and rentals and the resulting gross profit for sales and rentals, respectively, in each quarter and the full year of fiscal years 2018 and 2017.

In addition, in periods prior to 2019 and as reflected in the amounts presented below, the amount of revenue associated with garments was included in sales revenue. Due to the adoption of ASC 842, garment revenue is now included in rental revenue, and as comparable prior period financial information is presented in future issuances of our financial statements, garment revenue in prior periods will be reclassified from sales to rental revenue. To aid in comparison with our go-forward reporting convention, we have also set forth below the amount of garment revenue and garment cost of revenue that will be reclassified, in future financial statement issuances, from sales revenue and cost of sales revenue to rental revenue and cost of rental revenue, respectively, for the periods presented.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tactile Systems Technology, Inc.

Supplemental Financial Information and

Garment Revenue Reclassification

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2018

(Dollars in thousands)

    

Q1

    

Q2

    

Q3

    

Q4

    

Total

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue

 

$

23,889

 

$

30,873

 

$

32,969

 

$

42,460

 

$

130,191

Rental revenue

 

 

2,959

 

 

3,260

 

 

3,353

 

 

3,988

 

 

13,560

Total revenue

 

 

26,848

 

 

34,133

 

 

36,322

 

 

46,448

 

 

143,751

Cost of revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales revenue

 

 

6,478

 

 

8,644

 

 

9,153

 

 

13,108

 

 

37,383

Cost of rental revenue

 

 

831

 

 

966

 

 

988

 

 

1,325

 

 

4,110

Total cost of revenue

 

 

7,309

 

 

9,610

 

 

10,141

 

 

14,433

 

 

41,493

Gross profit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit - sales revenue

 

 

17,411

 

 

22,229

 

 

23,816

 

 

29,352

 

 

92,808

Gross profit - rental revenue

 

 

2,128

 

 

2,294

 

 

2,365

 

 

2,663

 

 

9,450

Total gross profit

 

$

19,539

 

$

24,523

 

$

26,181

 

$

32,015

 

$

102,258

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin % - sales

 

 

73%

 

 

72%

 

 

72%

 

 

69%

 

 

71%

Gross margin % - rental

 

 

72%

 

 

70%

 

 

71%

 

 

67%

 

 

70%

Gross margin % - total

 

 

73%

 

 

72%

 

 

72%

 

 

69%

 

 

71%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Garment revenue to be reclassified

 

$

242

 

$

301

 

$

447

 

$

415

 

$

1,405

Garment cost of revenue to be reclassified

 

$

69

 

$

87

 

$

126

 

$

132

 

$

414


 

Exhibit 99.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tactile Systems Technology, Inc.

Supplemental Financial Information and

Garment Revenue Reclassification

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2017

(Dollars in thousands)

    

Q1

    

Q2

    

Q3

    

Q4

    

Total

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue

 

$

18,081

 

$

23,966

 

$

25,555

 

$

31,568

 

$

99,170

Rental revenue

 

 

1,769

 

 

2,298

 

 

2,728

 

 

3,318

 

 

10,113

Total revenue

 

 

19,850

 

 

26,264

 

 

28,283

 

 

34,886

 

 

109,283

Cost of revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales revenue

 

 

5,075

 

 

6,372

 

 

6,772

 

 

7,922

 

 

26,141

Cost of rental revenue

 

 

549

 

 

662

 

 

756

 

 

907

 

 

2,874

Total cost of revenue

 

 

5,624

 

 

7,034

 

 

7,528

 

 

8,829

 

 

29,015

Gross profit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit - sales revenue

 

 

13,006

 

 

17,594

 

 

18,783

 

 

23,646

 

 

73,029

Gross profit - rental revenue

 

 

1,220

 

 

1,636

 

 

1,972

 

 

2,411

 

 

7,239

Total gross profit

 

$

14,226

 

$

19,230

 

$

20,755

 

$

26,057

 

$

80,268

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross margin % - sales

 

 

72%

 

 

73%

 

 

74%

 

 

75%

 

 

74%

Gross margin % - rental

 

 

69%

 

 

71%

 

 

72%

 

 

73%

 

 

72%

Gross margin % - total

 

 

72%

 

 

73%

 

 

73%

 

 

75%

 

 

73%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Garment revenue to be reclassified

 

$

467

 

$

432

 

$

353

 

$

275

 

$

1,527

Garment cost of revenue to be reclassified

 

$

127

 

$

112

 

$

91

 

$

74

 

$

404