CONCEPTUS INC - FORM 8-K - EX-99.2 - SLIDES ACCOMPANYING MAY 10, 2011 FIRST QUARTER 2011 EARNINGS CALL

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Conceptus, Inc.

Quarterly Results

First Quarter of 2011

May 10, 2011

Exhibit 99.2

Safe Harbor

2 -

Except for the historical information contained herein, the matters discussed in this presentation include

forward-looking statements, the accuracy of which is subject to risks and uncertainties. These forward-

looking statements include discussions regarding:

projected net sales and adjusted earnings before interest, taxes, depreciation, amortization and stock-

based compensation (“adjusted EBITDA”) for the full year 2011, and

the expected impact of the economy, high unemployment and increasing insurance costs that relate to

consumer spending on non-urgent medical procedures such as Essure, trends in and market share

related to competitive trialing, physician metric growth trends, our ability to increase utilization of

Essure through the promotion of a compatible endometrial ablation product, our ability to market

effectively to physicians and prospective patients, our ability to secure government reimbursement in

foreign countries, and the expected attainment of strategic initiatives intended to grow the business.

These discussions and other forward-looking statements included herein may differ significantly from

actual results. Such differences may be based upon factors such as changes in strategic planning

decisions by management, re-allocation of internal resources, changes in the impact of domestic and

global macroeconomic pressures, reimbursement decisions by insurance companies and domestic and

foreign governments, scientific advances by third parties, litigation risks, the effect of regulations

promulgated pursuant to the Affordable Care Act, and the introduction of competitive products, as well as

those factors set forth in the Company's most recent Annual Report on Form 10-K and most recent

Quarterly Report on Form 10-Q, and other filings with the Securities and Exchange Commission. These

forward-looking statements speak only as to the date on which the statements were made. We

undertake no obligation to update or revise publicly any forward-looking statements, whether as a result

of new information, future events, or otherwise.

First Quarter of 2011 Highlights

Mark Sieczkarek

President and Chief Executive Officer

Strategic Execution Impacted Growth

In Q1’11, we executed

several recent strategic

initiatives at the expense of

growing the hysteroscopic

sterilization market.

As anticipated, environmental

challenges continued to

weigh heavily on topline

growth.

Environmental

challenges

Executed

recent

initiatives

Market

growth

4 -

High Unemployment Remains

High unemployment and protracted economic conditions

continue to hamper consumer discretionary spending; non-

urgent medical procedures such as Essure represent a lagging

economic indicator

U.S. employment rates by quarter 2008-2011

5 -

COBRA Subsidies Decrease

2% of households have lost COBRA subsidies recently; about half

of those roll-offs are estimated to have occurred in Q1’11

Source: Department of Treasury, BLS, GE Capital Estimates

Estimated U.S. households that lost COBRA subsidies by quarter, cumulative

In thousands

6 -

Employers Shift Costs to Employees

Average

monthly

worker

contribution

premiums

Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2006–2010.

Average annual health insurance premiums

and

worker

contributions

for

family

coverage

$6,438

$13,770

114% Premium

increase

147% Worker

contribution

increase

High

deductible

health

plans

becoming

popular

Employees are paying higher premiums, deductibles and co-pays

7 -

Cumulative Effect of Macro Trends…

9% unemployment

13% enrolled in high deductible plans and

higher employee costs due to cost shifting

22% of workforce faces financial barriers to

non-urgent procedures

Seasonal re-setting of all deductibles

8 -

…Result in Fewer Office Visits

OB/GYN and FP/GP office visits declined further in Q1’11

Source: IMS Data

Patient office visits in millions

Period:

OB/GYN

FP/GP

2010

vs 2009

-15%

-5%

Q1’11

vs Q1’09

-23%

-10%

Q1’11

vs Q1’10

-8%

-1%

% change in select periods:

9 -

Q1’11 Highlights

Positives:

Defended accounts and competitive trialing activity slowed;

long-term Essure agreements increased

Launched

promotion

GYNECARE

THERMACHOICE®

III

(1)

U.S. physician offices

Negatives:

Gave short-term ground on growing the hysteroscopic

sterilization market; physician metrics pipeline rate of growth

declined

No direct-to-consumer promotion benefit

Macro-economics and insurance trends continue

10 -

(1)

Global endometrial ablation (GEA) product manufactured for and marketed by ETHICON™ Women’s

Health & Urology,a division of Ethicon, Inc.

Defend Existing Accounts

In total

450

accounts are covered by 1-3

year 90%+ Essure exclusivity agreements

by the end of Q1’11

1,100 accounts have trialed to date out

1,300 to

1,800 accounts anticipated

to trial

The number of accounts entering trialing

and the number of competitor cases in

Essure accounts has

remained low

Trialing expected to last

9 to

12 months

at a rate of

80 to

90 accounts entering

trialing per quarter + one year to trial

Rate of competitive trialing continues to decline

Number of Essure accounts that entered

competitive trialing by quarter

11 -

Sales Force

Redeployment

Launch Strategic Partnership

Since our launch in February >2,000 physicians have

committed to trialing

GYNECARE THERMACHOICE

III

the office within the next 12 months

Leverages our

in-office channel

strength

GEA procedure =

medical need for

permanent birth control

Essure and GYNECARE

THERMACHOICE®

III

are

compatible in-office

procedures

Patients are strongly

advised not to get pregnant

if they have a GEA

procedure

Key partnership elements:

12 -

Physician Metrics Pipeline

Rate of growth slowed in Q1’11 compared to previous

quarters; we will re-focus on higher growth

13 -

Q1’11

Q4’10

Q3’10

Q2’10

Q1’10

Current Period Activity:

Physicians entering preceptorship

340

413

375

387

423

Physicians becoming certified

189

458

324

335

406

Physicians transitioning to in-office

202

185

163

243

Physician Base:

12,870

12,530

12,117

11,742

11,355

Strategic Marketing

Consumer

Point of

Care

Physician

•

Resident, new-user and

in-office training

•

Clinician education

•

Reimbursement support

•

Essure candidate

identification tools

•

Patient support and

counseling through

all points of Essure

procedure

•

Consumer awareness

and education via print,

online and digital

•

New Essure branding

•

New Essurance

Promise™

Program

We are integrating consumer and physician marketing to

better manage the patient “continuum of care”

14 -

First Quarter of 2011

Financials

Greg Lichtwardt

Executive Vice President, Operations and

Chief Financial Officer

Q1’11 Snapshot

Net Sales

($M)

Gross Margin

(%)

Diluted GAAP

EPS

Operating

Exp. ($M)

Q1’10

Q1’11

$33.4

80.8%

80.4%

$26.6

$27.7

$25.1

($0.08)

($0.09)

$2.9

(1)

Adjusted earnings before interest, taxes, depreciation, amortization

and stock-based compensation. See reconciliation in Appendix

$0.1

Q1’10

Q1’11

Q1’10

Q1’11

Q1’10

Q1’11

Q1’10

Q1’11

16 -

Adj. EBITDA

(1)

($M)

Worldwide Sales

Q1’11 Net Sales (in $ millions)

Q1’11 Units (in thousands):

$33.4

Q1’10

Q1’11

$25.4

(76%)

$26.6

$18.9

(71%)

29.5

Q1’10

Q1’11

18.5

(63%)

11.0

(37%)

23.6

13.7

(58%)

9.9

(42%)

Domestic

International

$7.7

(29%)

$8.0

(24%)

17 -

Q1’11

Q1’10

Y/Y

Change

Q4’10

Q/Q

Change

Net Sales

$26.6

$33.4

(20.3%)

$36.6

(27.4%)

Gross Profit Margin

80.4%

80.8%

81.9%

Operating Expenses

$25.1

$27.7

(9.6%)

$23.8

5.2%

Adjusted EBITDA

(1)

$0.1

$2.9

(97.7%)

$10.1

(99.0%)

Other Income / (expense)

($1.5)

($1.6)

Tax Provision (benefit)

($2.3)

$0.1

($79.2)

NEAT (loss)

($2.9)

(2)

($2.4)

$83.7

(3)

GAAP EPS (diluted)

($0.09)

($0.08)

$2.66

(4)

Q1’11 Results

In $ millions except for EPS

(1)

Adjusted earnings before interest, taxes, depreciation, amortization and stock-based compensation. See appendix.

(2)

Net loss after taxes includes a net income tax benefit of $2.3 million.

(3)

Net earnings after taxes includes a net income tax benefit of $79.2 million primarily due to the release of the Company's

deferred tax valuation allowance

(4)

Diluted GAAP EPS includes a net income tax benefit of $2.52 primarily due to the release of the Company's deferred tax

valuation allowance

18 -

Q1’11 Adjusted EBITDA

Adjusted

EBITDA

$0.1

Amortization

intangibles

Stock-based

compensation

($2.9)

Net loss

See reconciliation in appendix

Interest

and other

income

(expense)

net

$ millions

Depreciation

expense

Benefit

from

income

taxes

$1.6

($2.3)

$0.8

$1.7

$1.2

19 -

Balance Sheet

Cash & cash equivalents

Investments

Accounts receivable

Inventories & other assets

PP&E

Intangibles

Goodwill

Deferred tax asset

Total assets

ASSETS

13.3

78.4

16.0

11.9

11.2

23.5

17.0

81.5

252.8

3/31/11

A/P & other accrued ST

liabilities

Notes payable

(1)

Other accrued LT liabilities

Total Equity

Total liabilities & equity

LIABILITIES &

EQUITY

12/31/10

16.4

82.1

2.6

151.7

252.8

(1)

Notes payable is a current liability as of 3/31/11

18.4

72.5

20.4

10.4

10.1

24.1

16.0

78.8

250.7

3/31/11

12/31/10

15.8

81.0

2.4

151.5

250.7

$ millions

20 -

Guidance

*See appendix

FY’11E

as of 5/10/11

FY’10

Actual

21 -

Net Sales

$135M to

$150M

$140.7M

Gross

Profit

Margin

82.0% to

82.5%

80.9%

Operating

Expenses

$102M to

$105M

$104.3M

Adjusted EBITDA

$24.7M

$34.7M

$24.8M

2011:

Strategic Plan Update

Mark Sieczkarek

President and Chief Executive Officer

Strategic Plan Goals

Goals

Economic Assumptions

Response

Navigate current

economy and

make Essure

Standard of Care

in PBC market

•

Current trends continue: high

unemployment, increasing

enrollment in high deductible and

HSA insurance plans and more

employer cost shifting to

employees

•

Patient utilization rates remain

low for non-urgent procedures

like Essure

•

Proceed with strategic

plan to control what we

can

23 -

Strategic Plan Update

Strategy

Details

Status

1. Minimize

impact of

competition

•

Defend our existing accounts

against competitive trialing

•

Expanded sales force

•

Continue to educate

physicians on Essure’s

superior efficacy

•

Pace of competitive trialing in

Essure accounts has slowed

2. Leverage in-

office channel

strength

•

Promote GYNECARE

THERMACHOICE®

III

to U.S.

physician offices and increase

utilization of Essure

•

Launched GYNECARE

THERMACHOICE®

III

promotion

efforts

•

>2,000 physicians have

committed to trialing

GYNECARE THERMACHOICE®

III

in the office setting

24 -

Strategic Plan Update

Strategy

Details

Status

3. Drive

awareness and

adoption of

Essure through

integrated

marketing

•

Integrate patient and physician

value proposition to increase

Essure utilization at point-of-

service

•

Utilize cost effective channels

such as digital, social media

and viral

•

Providing new tools to help

physicians identify Essure

candidates

•

Launched new branding

campaign

•

Launched Essurance Promise

program (May ’11)

4. Expand

international

presence

•

France

•

Brazil

•

Emerging markets

•

France: Working to reinstate

reimbursement for <40 market;

increased targeting of

market

•

Brazil: reimbursement focus

•

China and India: moving

forward on approval process

25 -

Strategic Plan Update

Strategy

Details

Status

5. Washington

DC focus and

reimbursement

issues

•

Include contraception in the

Preventative Services for

Women’s healthcare package

(Institute of Medicine initiative)

•

Medicaid reimbursement and

cost saving issues

•

ACOG recognition of

hysteroscopic sterilization as

“standard of care”

•

Recommendation expected in

second half of 2011

•

35 states provide adequate

Essure Medicaid fee-for-

service office reimbursement

as of 3/31/11

•

Continuing discussions with

ACOG

26 -

Strategic Plan Update

Strategy

Details

Status

6. Create a

pipeline of

women’s

health products

and services

•

Designed to accelerate

adoption of Essure

•

Provide more diversified

offerings

•

Ongoing review of potential

high-growth synergistic

opportunities

•

Prefer in-office setting

7. Product

enhancements

•

Next generation of Essure

procedure

•

Seek FDA approval of

transvaginal ultrasound (TVU)

for U.S. Essure confirmation

instead of HSG

•

Moving forward with expected

trials

•

CE Mark and Canadian

approval on TVU

27 -

Key Take-Aways

Progress made on recent strategic

initiatives: launched promotion of

GYNECARE THERMACHOICE

III to

U.S. physician offices and defended

against competitive trialing

Re-focus on growing the market;

work to increase productivity, grow

physician pipeline, expand Essure

utilization and drive patient adoption

through integrated marketing

Sales Force

Redeployment

Macro-economic and insurance

trends may continue to

significantly impact sales growth

in 2011

Strategic plan is designed to

optimize long-term growth

Estimated U.S. households that lost COBRA

subsidies by quarter, cumulative

In thousands

Number of Essure accounts that entered

competitive trialing by quarter

28 -

Appendix

Use of Non-GAAP Financial Measures

The Company has supplemented its GAAP net loss with a non-GAAP measure

of adjusted earnings before interest, taxes, depreciation, amortization and

stock-based compensation (“adjusted EBITDA”). Management believes that

this non-GAAP financial measure provides useful supplemental information to

management and investors regarding the performance of the Company’s

business operations, facilitates a better comparison of results for current

periods with the Company’s previous operating results, and assists

management in analyzing future trends, making strategic and business

decisions and establishing internal budgets and forecasts. A reconciliation of

non-GAAP adjusted EBITDA to GAAP net loss in the most directly comparable

GAAP measure, is provided in the below schedule.

There are limitations in using this non-GAAP financial measure because it is

not prepared in accordance with GAAP and may be different from non-GAAP

financial measures used by other companies. This non-GAAP financial

measure

should

not

considered

isolation

substitute

for

GAAP

financial measures. Investors and potential investors should consider non-

GAAP financial measures only in conjunction with the Company’s consolidated

financial statements prepared in accordance with GAAP and the reconciliations

of the non-GAAP financial measure provided in the below schedules.

30 -

GAAP to Non-GAAP Reconciliation

31 -

2011

2010

Net loss, as reported

(2,928)

(2,351)

Adjustments to net loss:

Interest and other income (expense), net (a)

1,548

1,459

Provision (benefit) for income taxes

(2,304)

134

Amortization of intangibles (b)

813

819

Stock-based compensation (c)

1,695

1,729

Depreciation expense (d)

1,242

1,097

Adjustments to net loss

2,994

5,238

Adjusted EBITDA

2,887

(a) Consists of interest from available-for-sale securities, interest expense associated with our

convertible debt and foreign exchange currency transactions

(b) Consists of amortization of intangible assets, primarily licenses and customer relationships

(d) Consists of depreciation, primarily on property, plant and equipment

(In thousands)

Conceptus, Inc.

March 31,

Three Months Ended

Reconciliation

Net

Loss

Adjusted

Earnings

Before

Interest,

Taxes,

Depreciation,

Amortization and Stock-Based Compensation (Adjusted EBITDA)

(Unaudited)

GAAP to Non-GAAP Reconciliation

From

Net Income Guidance

1,550

7,750

Adjustments to net income:

Interest and other income (expense), net (a)

6,092

Provision for income taxes

950

4,750

Amortization of intangibles (b)

3,261

Stock-based compensation (c)

7,571

Depreciation expense (d)

5,250

Adjustments to net income

23,124

26,924

Adjusted EBITDA

24,674

34,674

(a) Consists of interest from available-for-sale securities, interest expense associated with our

convertible debt and foreign exchange currency transactions

(b) Consists of amortization of intangible assets, primarily licenses and customer relationships

(d) Consists of depreciation, primarily on property, plant and equipment

Conceptus, Inc.

Reconciliation of Forward-Looking Guidance For Non-GAAP Financial Measures

To Projected GAAP Net Income

(Unaudited)

32 -

NASDAQ: CPTS

Conceptus, Inc.

Revolutionizing women’s healthcare with

innovative solutions

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