UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 12, 2012
AngioDynamics, Inc.
(Exact Name of Registrant as Specified in Charter)
|
Delaware
|
000-50761
|
11-3146460
|
|
(State or Other Jurisdiction of Incorporation)
|
(Commission File
Number)
|
(IRS Employer
Identification No.)
|
|
603 Queensbury Avenue, Queensbury, New York 12804
|
|
(Address of Principal Executive Offices) (Zip Code)
|
|
(518) 798-1215
|
|
(Registrant’s telephone number, including area code)
|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
|
|
o
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
|
o
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
|
o
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2 (b))
|
|
|
o
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))
|
Item 2.02 – Results of Operations and Financial Condition.
On July 12, 2012, AngioDynamics, Inc. (the “Company”) issued a press release announcing financial results for the fiscal fourth quarter and fiscal year ended May 31, 2012. A copy of the press release is attached hereto as Exhibit 99.1.
On July 12, 2012, the Company will host a conference call to discuss its fiscal fourth quarter and fiscal year ended May 31, 2012 financial results. A copy of the presentation to be used during the conference call is attached hereto as Exhibit 99.2.
The information set forth in Item 2.02 of this Form 8-K (including Exhibit 99.1 and Exhibit 99.2) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Forward-Looking Statements
This document and its attachments include "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Investors can identify these statements by the fact that they do not relate strictly to historical or current facts. These statements contain words such as "expect," "reaffirm," "anticipate," "plan," "believe," "estimate," "may," "will," "predict," "project," "might," "intend," "potential," "could," "would," "should," "optimistic," "seek," "continue," "pursue," or "our future success depends," or the negative or other variations thereof or comparable terminology, are intended to identify such forward-looking statements. In particular, they include statements relating to, among other things, future actions, strategies, future performance and future financial results of the Company. These forward-looking statements are based on current expectations and projections about future events.
Investors are cautioned that forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties that cannot be predicted or quantified and, consequently, the actual performance or results of the Company may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to, the factors described from time to time in the Company's reports filed with the SEC, including the Company's Form 10-K for the fiscal year ended May 31, 2011 and the Company’s Forms 10-Q for the fiscal quarters ended November 30, 2011 and February 29, 2012, financial community and rating agency perceptions of the Company; the effects of economic, credit and capital market conditions on the economy in general, and on medical device companies in particular; domestic and foreign health care reforms and governmental laws and regulations; third-party relations and approvals, technological advances and patents attained by competitors; and challenges inherent in new product development, including obtaining regulatory approvals. In addition to the matters described above, the ability of the Company to develop its products, future actions by the FDA or other regulatory agencies, results of pending or future clinical trials, the outcome of pending litigation,
overall economic conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, and the effects on pricing from group purchasing organizations and competition and the ability of the Company to integrate purchased businesses, may affect the actual results achieved by the Company.
Any forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995 and, as such, speak only as of the date made. The Company disclaims any obligation to update the forward-looking statements. Investors are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date stated, or if no date is stated, as of the date of this document.
Item 9.01 – Financial Statements and Exhibits.
(d) Exhibits.
|
Exhibit No.
|
Description
|
|
|
99.1
|
Press Release dated July 12, 2012.
|
|
|
99.2
|
Presentation dated July 12, 2012.
|
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
ANGIODYNAMICS, INC.
(Registrant) |
|||
|
Date: July 12, 2012
|
By:
|
/s/ D. Joseph Gersuk | |
| D. Joseph Gersuk | |||
| Chief Financial Officer | |||
EXHIBIT INDEX
|
Exhibit No.
|
Description
|
|
|
99.1
|
Press Release dated July 12, 2012.
|
|
|
99.2
|
Presentation dated July 12, 2012.
|
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
|
Company Contact:
|
Investor Relations Contacts:
|
Media Contact:
|
|
AngioDynamics, Inc.
D. Joseph Gersuk, CFO
(800) 772-6446 x1608
jgersuk@AngioDynamics.com
|
EVC Group, Inc.
Jamar Ismail/Robert Jones
(415) 568-9348; (646) 201-5447
jismail@evcgroup.com; bjones@evcgroup.com
|
EVC Group, Inc.
Chris Gale
(646) 201-5431
cgale@evcgroup.com
|
AngioDynamics Reports Fiscal 2012 Fourth Quarter
and Full Year Financial Results
|
·
|
Net sales of $57.7 million with Navilyst Medical contributing $4.8 million
|
|
·
|
GAAP net loss of $7.0 million, or $0.27 per share; adjusted (Non-GAAP) net income of $2.6 million, or $0.10 per share, including $0.01 from Navilyst Medical
|
|
·
|
Integration of Navilyst Medical is progressing on schedule
|
|
·
|
Company provides financial guidance for fiscal 2013
|
ALBANY, N.Y. (July 12, 2012) – AngioDynamics (NASDAQ: ANGO), a leading provider of innovative, minimally invasive medical devices for vascular access, surgery, peripheral vascular disease and oncology, today reported financial results for the fiscal 2012 fourth quarter and year ended May 31, 2012. Financial results include Navilyst Medical since May 22, 2012.
“With the Navilyst acquisition completed, we are focused on executing our plan to achieve the growth, benefits and cost savings we originally identified,” said Joseph DeVivo, President and CEO of AngioDynamics. “We have doubled our share of the vascular access market, built critical mass in the peripheral vascular market and several of Navilyst’s executives have become key members of our leadership team. During the fourth quarter, our VenaCure EVLT® system sales grew 17%, our international business grew 22% and NanoKnife® System sales grew 54% following the resumption of shipments in the U.S. We enter fiscal year 2013 with confidence.”
Fiscal Fourth Quarter
Net sales of $57.7 million increased 3% from $56.2 million a year ago, with Navilyst Medical contributing $4.8 million. Excluding Navilyst and sales of LC Beads, a discontinued product line after the expected conclusion of the U.S. distribution agreement on December 31, 2011, year-over-year net sales grew 10%. Total Vascular sales increased 23%, or 10% excluding Navilyst, to $46.3 million from $37.8 million a year ago. Oncology/Surgery sales were $11.4 million compared to $18.5 million a year ago.
Excluding $8.2 million of LC Beads sales in the prior fourth quarter, Oncology/Surgery sales increased 11%. U.S. sales decreased 2% and increased 9% excluding LC Beads and Navilyst, to $47.6 million. International sales increased 28% (31% on a constant currency basis), or 19% (22% on a constant currency basis) excluding Navilyst, to $10.1 million from the fourth quarter a year ago.
Gross margin in the fourth quarter was reduced to 54.0% compared to 57.7% a year ago due to $1.4 million in costs relating to the Quality Call to Action program and $921,000 in product recall costs. Excluding these costs, the gross margin for the quarter was 58.1%.
The Company reported a net loss of $7.0 million, or $0.27 per share including costs related to acquisition, business restructuring and financing activities, compared with a net loss of $862,000, or $0.03 per share, in the prior year’s fourth quarter. Excluding the $12.0 million of pre-tax costs related to acquisition, business restructuring, the Quality Call to Action program, product recalls and financing activities, adjusted (Non-GAAP) net income was $2.6 million, or $0.10 per share, in the quarter, which is the same as the fourth quarter a year ago. Adjusted (Non-GAAP) EBITDA was $7.9 million, or $0.30 per share, in the fourth quarter, compared to $7.7 million, or $0.31 per share, in the prior year period.
At May 31, 2012, cash, escrow receivable and investments were $40.1 million and long-term debt was $ 142.5 million.
Fiscal Year
For the fiscal year ended May 31, 2012, net sales grew 3% to $221.8 million. LC Beads, contributed $21.3 million in sales in fiscal 2012 and $28.3 million in fiscal 2011. Excluding the sales contribution from Navilyst and LC Beads, sales increased 4% in fiscal 2012 to $195.7 million.
Vascular sales of $159.1 million increased 6%, or 3% excluding Navilyst, from $149.5 million in fiscal 2011. Oncology/Surgery sales were $62.7 million in the fiscal year compared to $66.2 million a year ago. Excluding LC Beads, Oncology/Surgery sales grew 9% to $41.4 million. U.S. sales were $188.2 million or flat with last year and increased 1% excluding LC Beads and Navilyst. International sales increased 25% on a reported and constant currency basis, or 22% excluding Navilyst, to $33.6 million from $26.9 million in fiscal 2011.
Gross margin was reduced to 56.8% compared to 58.3% in the prior year due to $2.3 million in costs relating to the Quality Call to Action program and $2.8 million in product recall costs. Excluding these costs, gross margin for the year was 59.1%.
The Company reported a net loss of $5.1 million, or $0.20 per share including costs relating to acquisition, business restructuring, the Quality Call to Action program, product recalls and financing activities, compared with net income of $8.1 million, or $0.32 per share, in fiscal 2011. Excluding the $22.2 million of pre-tax costs relating to acquisition, business restructuring, the Quality Call to Action program, product recalls and financing
2
activities adjusted (Non-GAAP) net income was $11.0 million, or $0.43 per share, in fiscal 2012 compared with adjusted (Non-GAAP) net income of $11.6 million, or $0.46 per share, in fiscal 2011. Adjusted (Non-GAAP) EBITDA was $31.4 million, or $1.23 per share, in the fiscal year, compared to $31.7 million, or $1.26 per share, in fiscal 2011.
Highlights of the reporting and subsequent period include:
|
·
|
The establishment of a strategic relationship with Microsulis Medical Ltd., a medical device company specializing in minimally invasive, microwave ablation technology for the coagulation of soft tissue. The relationship includes a $5 million investment for a 14.3% ownership position, exclusive distribution rights to market and sell the Accu2i pMTA microwave ablation system in all markets outside the United States until December 2013, and an exclusive option to purchase, at any time until September 2013, substantially all of the global assets of Microsulis Medical Ltd., including the microwave ablation technology and its worldwide distribution rights.
|
|
·
|
NanoKnife® System sales grew 54% to $4.1 million in the fourth quarter and 59% to $11.6 million in the fiscal year despite the temporary stop in shipments in the U.S. between January and April.
|
|
·
|
Clinical support for the NanoKnife System continues to build, including the publication of two studies in the Journal of the American College of Surgeons:
|
|
o
|
“Irreversible Electroporation Therapy in the Management of Locally Advanced Pancreatic Adenocarcinoma” – Doctors Robert Martin and Susan Ellis at the University of Louisville School of Medicine, Louisville, Ky.; and Doctors Kelli McFarland and Vic Velanovich at Henry Ford Hospital, Detroit, Mich.
|
|
o
|
“Ablation of Perivascular Hepatic Malignant Tumors with Irreversible Electroporation” – Doctors Peter Kingham, Yuman Fong, Ami Karkar, Michael D’Angelica, Peter Allen, Ronald DeMatteo, George Getrajdman, Constantinos Sofocleous, Stephen Solomon, and William Jarnagin, all physicians at Memorial Sloan Kettering Cancer Center, New York, N.Y.
|
In addition to the previously announced presentations at the Society of Interventional Radiology (SIR) 2012 Annual Scientific Meeting and Society of Surgical Oncology (SSO) 2012 conference, two presentations were made on using the NanoKnife System to treat pancreatic cancer at the International Hepato-Pancreato-Biliary Association meeting in Paris earlier this month. Dr. Robert Martin of the University of Louisville presented clinical experience in margin accentuation in pancreatic surgery. Dr. Kevin Watkins of Stony Brook University presented his pancreatic clinical experience and on the safety and efficacy of the NanoKnife System. Approximately 1,300 patients worldwide have been treated with the NanoKnife System as of May 31, 2012.
3
|
·
|
Strengthened the Oncology/Surgery product portfolio by re-entering the embolization market and with the launches of the Embarc Microcatheter and Charter Guidewire.
|
|
·
|
VenaCure EVLT® system sales increased 17% in the fourth quarter and 14% in the fiscal year over the comparable prior year periods. The growth was driven by strong customer acceptance of the recently-introduced VenaCure® 1470 laser and continued market share growth of NeverTouch® procedure kits.
|
|
·
|
The signing of a three-year agreement with Canada’s national healthcare group purchasing organization, HealthPRO, which represents the purchasing interests of 225 hospitals, provincial authorities and Shared Service Organizations.
|
Fiscal 2013 Guidance
|
GAAP
|
Adjusted
Non-GAAP
|
||
|
Sales ($ in mils.) (a)
|
360 - 363
|
360 – 363
|
|
|
Pro Forma Sales Growth (b)
|
5%
|
5%
|
|
|
Gross Margin
|
52-53%
|
52-53%
|
|
|
Operating Income ($ in mils.) ( c)
|
18 – 20
|
34 – 36
|
|
|
EBITDA ($ in mils.) (d)
|
44 – 45
|
60 – 61
|
|
|
EPS ($) (e)
|
0.21 - 0.23
|
0.49 - 0.51
|
|
|
a)
|
Quarterly calendarization is expected to approximate 23%/25%/25%/27% of the annual amount
|
|
b)
|
FY 12 pro forma combined sales excluding LC Beads is $344.3 million.
|
|
c)
|
Adjusted result reflects an estimated $16 million in acquisition-related and restructuring costs, which include amortization of inventory basis step-up, acelerated asset depreciation, transaction-related professional fees, employment severance costs, QCTA/FDA remediation programs, and the closure of the U.K. manufacturing facility. Quarterly calendarization of the $16 million will approximate $8 million/$5 million/$2 million/$1 million.
|
|
d)
|
$17 million in amortization and $8 million in depreciation
|
|
e)
|
Approximately 36 million diluted shares outstanding and a 37% tax rate. Includes medical device tax effective January 1, 2013.
|
4
“Our guidance for fiscal 2013 remains consistent with our forecast for the combined organization when we announced the transaction in late January,” added Mr. DeVivo. “We are on plan to both complete the integration of Navilyst Medical and successfully execute the Quality Call to Action Program. As the new fiscal year progresses, we anticipate our growth rate will escalate as we execute our sales and operating strategy in the vascular access, peripheral vascular and oncology markets. Our goal is to exit the year positioned to generate double-digit top- and bottom-line growth over the long term.”
Conference Call
AngioDynamics will host a conference call today with accompanying slides at 4:30 p.m. Eastern Time to discuss its fourth quarter and full year fiscal 2012 results. To participate in the call, please dial (800) 762-8779. In addition, a live webcast and archived replay of the call will be available at http://investors.angiodynamics.com. To access the live webcast, please go to the Web site 15 minutes prior to its start to register, download and install the necessary software.
Use of Non-GAAP Measures
Management uses non-GAAP measures to establish operational goals, and believes that non-GAAP measures may assist investors in analyzing the underlying trends in AngioDynamics’ business over time. Investors should consider these non-GAAP measures in addition to, not as a substitute for or as superior to, financial reporting measures prepared in accordance with GAAP. In this news release, AngioDynamics has reported pro forma sales growth, sales on a constant currency basis, non-GAAP gross margin, non-GAAP operating income, non-GAAP EBITDA (income before interest, taxes, depreciation and amortization), non-GAAP net income and non-GAAP earnings per share. Management uses these measures in its internal analysis and review of operational performance. Management believes that these measures provide investors with useful information in comparing AngioDynamics’ performance over different periods. By using these non-GAAP measures, management believes that investors get a better picture of the performance of AngioDynamics’ underlying business. Management encourages investors to review AngioDynamics’ financial results prepared in accordance with GAAP to understand AngioDynamics’ performance taking into account all relevant factors, including those that may only occur from time to time but have a material impact on AngioDynamics’ financial results. Please see the tables that follow for a reconciliation of non-GAAP measures to measures prepared in accordance with GAAP.
About AngioDynamics
AngioDynamics, Inc. is a leading provider of innovative, minimally invasive medical devices used by professional healthcare providers for vascular access, surgery, peripheral vascular disease and oncology. AngioDynamics’ diverse product lines include market-leading ablation systems, fluid management systems, vascular access products, angiographic products and accessories, angioplasty products, drainage products, thrombolytic products and venous products. More information is available at www.AngioDynamics.com.
5
Safe Harbor
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as statements that include the words such as “expects,” “reaffirms,” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “optimistic,” or variations of such words and similar expressions, are forward-looking statements. These forward looking statements are not guarantees of future performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics’ expectations. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to develop its existing and new products, technological advances and patents attained by competitors, future actions by the FDA or other regulatory agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic conditions, the results of on-going litigation, the effects of economic, credit and capital market conditions, general market conditions, market acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of AngioDynamics to integrate purchased businesses, including Navilyst Medical and its products, R&D capabilities, infrastructure and employees as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but not limited to its Annual Report on Form 10-K for the year ended May 31, 2011, and AngioDynamics’ Forms 10-Q for the quarterly periods ended November 30, 2011, and February 29, 2012. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking statements for any reason.
###
6
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
|
|||||||||||||||||
|
CONSOLIDATED INCOME STATEMENTS
|
|||||||||||||||||
|
(in thousands, except per share data)
|
|||||||||||||||||
|
Three months ended
|
Twelve months ended
|
|||||||||||||||
|
May 31,
|
May 31,
|
May 31,
|
May 31,
|
|||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Net sales
|
$ | 57,690 | $ | 56,222 | $ | 221,787 | $ | 215,749 | ||||||||
|
Cost of sales
|
26,522 | 23,797 | 95,829 | 90,047 | ||||||||||||
|
Gross profit
|
31,168 | 32,425 | 125,958 | 125,702 | ||||||||||||
|
% of net sales
|
54.0 | % | 57.7 | % | 56.8 | % | 58.3 | % | ||||||||
|
Operating expenses
|
||||||||||||||||
|
Research and development
|
5,222 | 5,549 | 20,511 | 21,373 | ||||||||||||
|
Sales and marketing
|
16,546 | 15,333 | 64,505 | 58,122 | ||||||||||||
|
General and administrative
|
4,962 | 4,722 | 18,334 | 17,827 | ||||||||||||
|
Amortization of intangibles
|
2,492 | 2,574 | 9,406 | 9,234 | ||||||||||||
|
Acquisition and other non-recurring
|
8,793 | 6,410 | 16,164 | 7,182 | ||||||||||||
|
Total operating expenses
|
38,015 | 34,588 | 128,920 | 113,738 | ||||||||||||
|
Operating income (loss)
|
(6,847 | ) | (2,163 | ) | (2,962 | ) | 11,964 | |||||||||
|
Other income (expense), net
|
(1,226 | ) | (298 | ) | (2,320 | ) | (1,266 | ) | ||||||||
|
Income (loss) before income taxes
|
(8,073 | ) | (2,461 | ) | (5,282 | ) | 10,698 | |||||||||
|
Provision for (benefit from) income taxes
|
(1,045 | ) | (1,599 | ) | (188 | ) | 2,581 | |||||||||
|
Net income (loss)
|
$ | (7,028 | ) | $ | (862 | ) | $ | (5,094 | ) | $ | 8,117 | |||||
|
Earnings (Loss) per common share
|
||||||||||||||||
|
Basic
|
$ | (0.27 | ) | $ | (0.03 | ) | $ | (0.20 | ) | $ | 0.33 | |||||
|
Diluted
|
$ | (0.27 | ) | $ | (0.03 | ) | $ | (0.20 | ) | $ | 0.32 | |||||
|
Weighted average common shares
|
||||||||||||||||
|
Basic
|
26,193 | 24,979 | 25,382 | 24,870 | ||||||||||||
|
Diluted
|
26,193 | 24,979 | 25,382 | 25,133 | ||||||||||||
7
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
|
|
GAAP TO NON-GAAP RECONCILIATION
|
|
(in thousands, except per share data)
|
Reconciliation of Operating Income to non-GAAP EBITDA and non-GAAP Adjusted EBITDA:
|
Three months ended
|
Twelve months ended
|
|||||||||||||||
|
May 31,
|
May 31,
|
May 31,
|
May 31,
|
|||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Operating income (loss)
|
$ | (6,847 | ) | $ | (2,163 | ) | $ | (2,962 | ) | $ | 11,964 | |||||
|
Amortization of intangibles
|
2,492 | 2,574 | 9,406 | 9,234 | ||||||||||||
|
Depreciation
|
1,127 | 893 | 3,671 | 3,345 | ||||||||||||
|
EBITDA
|
(3,228 | ) | 1,304 | 10,115 | 24,543 | |||||||||||
|
Acquisition and restructuring (1)
|
8,793 | 6,410 | 16,164 | 7,182 | ||||||||||||
|
Quality Call to Action Program (2)
|
1,414 | - | 2,326 | - | ||||||||||||
|
Product recalls (3)
|
921 | - | 2,800 | - | ||||||||||||
|
Adjusted EBITDA
|
$ | 7,900 | $ | 7,714 | $ | 31,405 | $ | 31,725 | ||||||||
|
EBITDA per common share
|
||||||||||||||||
|
Assumes Diluted
|
$ | (0.12 | ) | $ | 0.05 | $ | 0.40 | $ | 0.98 | |||||||
|
Adjusted EBITDA per common share
|
||||||||||||||||
|
Assumes Diluted
|
$ | 0.30 | $ | 0.31 | $ | 1.23 | $ | 1.26 | ||||||||
Reconciliation of Operating Income to non-GAAP Operating Income:
|
Three months ended
|
Twelve months ended
|
|||||||||||||||
|
May 31,
|
May 31,
|
May 31,
|
May 31,
|
|||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Operating income (loss)
|
$ | (6,847 | ) | $ | (2,163 | ) | $ | (2,962 | ) | $ | 11,964 | |||||
|
Acquisition and restructuring (1)
|
8,793 | 6,410 | 16,164 | 7,182 | ||||||||||||
|
Quality Call to Action Program (2)
|
1,414 | - | 2,326 | - | ||||||||||||
|
Product recalls (3)
|
921 | - | 2,800 | - | ||||||||||||
|
Adjusted Operating income
|
$ | 4,281 | $ | 4,247 | $ | 18,328 | $ | 19,146 | ||||||||
8
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
|
|
GAAP TO NON-GAAP RECONCILIATION (Continued)
|
|
(in thousands, except per share data)
|
Reconciliation of Net Income to non-GAAP Net Income:
|
Three months ended
|
Twelve months ended
|
|||||||||||||||
|
May 31,
|
May 31,
|
May 31,
|
May 31,
|
|||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Net income (loss)
|
$ | (7,028 | ) | $ | (862 | ) | $ | (5,094 | ) | $ | 8,117 | |||||
|
After tax:
|
||||||||||||||||
|
Acquisition and restructuring (1)
|
8,072 | 3,429 | 12,744 | 3,505 | ||||||||||||
|
Quality Call to Action Program (2)
|
919 | - | 1,512 | - | ||||||||||||
|
Product recalls (3)
|
599 | - | 1,820 | - | ||||||||||||
|
Adjusted net income
|
$ | 2,562 | $ | 2,567 | $ | 10,982 | $ | 11,622 | ||||||||
Reconciliation of Diluted Earnings (Loss) Per Share to non-GAAP Diluted Earnings Per Share:
|
Three months ended
|
Twelve months ended
|
|||||||||||||||
|
May 31,
|
May 31,
|
May 31,
|
May 31,
|
|||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Diluted earnings (Loss) per share (4)
|
$ | (0.27 | ) | $ | (0.03 | ) | $ | (0.20 | ) | $ | 0.32 | |||||
|
After tax:
|
||||||||||||||||
|
Acquisition and restructuring (1)
|
$ | 0.31 | $ | 0.14 | $ | 0.50 | $ | 0.14 | ||||||||
|
Quality Call to Action Program (2)
|
$ | 0.03 | $ | - | $ | 0.06 | $ | - | ||||||||
|
Product recalls (3)
|
$ | 0.02 | $ | - | $ | 0.07 | $ | - | ||||||||
|
Diluted earnings per share
|
$ | 0.10 | * | $ | 0.10 | * | $ | 0.43 | $ | 0.46 | ||||||
* Does not sum due to rounding
|
(1)
|
Represents costs relating to acquisitions and debt financing, as well as business restructuring actions, which
|
|
include the CEO and other executive transitions and the beginning of a program to close a facility in the UK.
|
|
|
(2)
|
Represents implementation of a comprehensive Quality Call to Action program to review and augment the
|
|
quality management systems at our Queensbury and Fremont facilities.
|
|
|
(3)
|
Represents costs attributable to the voluntary recall of NeverTouch® procedure kits, Morpheus® Smart
|
|
PICC CT PICCs and DuraMax® Chronic Hemodialysis Catheters.
|
|
|
(4)
|
Assumes diluted shares are used for the calculation of earnings (loss) per share.
|
9
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
|
|
NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
|
|
(in thousands)
|
|
Three months ended
|
Twelve months ended
|
|||||||||||||||
|
May 31,
|
May 31,
|
May 31,
|
May 31,
|
|||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Net Sales by Product Category
|
||||||||||||||||
|
Vascular
|
||||||||||||||||
|
Peripheral Vascular
|
$ | 28,301 | $ | 22,431 | $ | 95,200 | $ | 86,992 | ||||||||
|
Access
|
17,994 | 15,323 | 63,857 | 62,530 | ||||||||||||
|
Total Vascular
|
46,295 | 37,754 | 159,057 | 149,522 | ||||||||||||
|
Oncology/Surgery
|
11,395 | 18,468 | 62,730 | 66,227 | ||||||||||||
|
Total
|
$ | 57,690 | $ | 56,222 | $ | 221,787 | $ | 215,749 | ||||||||
|
Net Sales by Geography
|
||||||||||||||||
|
United States
|
$ | 47,600 | $ | 48,364 | $ | 188,187 | $ | 188,878 | ||||||||
|
International
|
10,090 | 7,858 | 33,600 | 26,871 | ||||||||||||
|
Total
|
$ | 57,690 | $ | 56,222 | $ | 221,787 | $ | 215,749 | ||||||||
10
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED BALANCE SHEETS
|
|
(in thousands)
|
|
May 31,
|
May 31,
|
|||||||
|
2012
|
2011
|
|||||||
|
(unaudited)
|
(unaudited)
|
|||||||
|
Assets
|
||||||||
|
Current Assets
|
||||||||
|
Cash and cash equivalents
|
$ | 23,508 | $ | 45,984 | ||||
|
Escrow receivable
|
2,500 | - | ||||||
|
Marketable securities
|
14,070 | 85,558 | ||||||
|
Total cash, escrow receivable and investments
|
40,078 | 131,542 | ||||||
|
Receivables, net
|
48,588 | 27,141 | ||||||
|
Inventories, net
|
55,823 | 28,126 | ||||||
|
Deferred income taxes
|
4,962 | 2,821 | ||||||
|
Prepaid income taxes
|
3,402 | 503 | ||||||
|
Prepaid expenses and other
|
6,425 | 4,172 | ||||||
|
Total current assets
|
159,278 | 194,305 | ||||||
|
Property, plant and equipment, net
|
55,915 | 23,804 | ||||||
|
Intangible assets, net
|
143,568 | 48,037 | ||||||
|
Goodwill
|
313,975 | 161,951 | ||||||
|
Deferred income taxes
|
40,435 | 5,835 | ||||||
|
Other non-current assets
|
11,906 | 3,489 | ||||||
|
Total Assets
|
$ | 725,077 | $ | 437,421 | ||||
|
Liabilities and Stockholders' Equity
|
||||||||
|
Current portion of long-term debt
|
$ | 7,500 | $ | 275 | ||||
|
Other current liabilities
|
51,685 | 25,232 | ||||||
|
Long-term debt, net of current portion
|
142,500 | 6,275 | ||||||
|
Total Liabilities
|
201,685 | 31,782 | ||||||
|
Stockholders' equity
|
523,392 | 405,639 | ||||||
|
Total Liabilities and Stockholders' Equity
|
$ | 725,077 | $ | 437,421 | ||||
|
Shares outstanding
|
34,684 | 24,986 | ||||||
11
|
ANGIODYNAMICS, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
(in thousands)
|
|
Twelve months ended
|
||||||||
|
May 31,
|
May 31,
|
|||||||
|
2012
|
2011
|
|||||||
|
(unaudited)
|
(unaudited)
|
|||||||
|
Cash flows from operating activities:
|
||||||||
|
Net income
|
$ | (5,094 | ) | $ | 8,117 | |||
|
Depreciation and amortization
|
13,044 | 12,579 | ||||||
|
Tax effect of exercise of stock options
|
(437 | ) | (741 | ) | ||||
|
Deferred income taxes
|
(524 | ) | (840 | ) | ||||
|
Stock-based compensation
|
4,090 | 4,609 | ||||||
|
Other
|
1,987 | 6,341 | ||||||
|
Changes in operating assets and liabilities
|
||||||||
|
Receivables
|
(2,496 | ) | 2,770 | |||||
|
Inventories
|
(1,091 | ) | 1,418 | |||||
|
Accounts payable and accrued liabilities
|
6,673 | (2,433 | ) | |||||
|
Other
|
(5,323 | ) | 2,050 | |||||
|
Net cash provided by operating activities
|
10,829 | 33,870 | ||||||
|
Cash flows from investing activities:
|
||||||||
|
Additions to property, plant and equipment
|
(2,492 | ) | (2,957 | ) | ||||
|
Acquisition of businesses, intangibles and other assets
|
(237,201 | ) | (1,086 | ) | ||||
|
Change in escrow receivable
|
(2,500 | ) | - | |||||
|
Proceeds from sale of assets
|
1,000 | - | ||||||
|
Long term investment
|
(5,000 | ) | - | |||||
|
Purchases, sales and maturities of marketable securities, net
|
70,499 | (44,577 | ) | |||||
|
Net cash used in investing activities
|
(175,694 | ) | (48,620 | ) | ||||
|
Cash flows from financing activities:
|
||||||||
|
Repayment of long-term debt
|
(6,550 | ) | (260 | ) | ||||
|
Proceeds from issuance of new debt
|
150,000 | - | ||||||
|
Deferred financing costs on long-term debt
|
(2,378 | ) | - | |||||
|
Proceeds from exercise of stock options and ESPP
|
1,252 | 2,182 | ||||||
|
Repurchase and retirement of shares
|
14 | - | ||||||
|
Net cash provided by financing activities
|
142,338 | 1,922 | ||||||
|
Effect of exchange rate changes on cash
|
51 | 49 | ||||||
|
Decrease in cash and cash equivalents
|
(22,476 | ) | (12,779 | ) | ||||
|
Cash and cash equivalents
|
||||||||
|
Beginning of period
|
45,984 | 58,763 | ||||||
|
End of period
|
$ | 23,508 | $ | 45,984 | ||||
12
EXHIBIT 99.2
FORWARD-LOOKING STATEMENTS
Notice Regarding Forward Looking Statements
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements
regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital
expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as
statements that include the words such as “expects,” “reaffirms” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “optimistic,” or
variations of such words and similar expressions, are forward-looking statements. These forward looking statements are not guarantees of future
performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics’
expectations. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to
develop its existing and new products, technological advances and patents attained by competitors, future actions by the FDA or other regulatory
agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic
conditions, the results of on-going litigation, the effects of economic, credit and capital market conditions, general market conditions, market
acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of
AngioDynamics to integrate purchased businesses, as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but
not limited to its Annual Report on Form 10-K for the year ended May 31, 2011 and its Quarterly Report on Form 10-Q for the fiscal quarters ended
November 30, 2011 and February 29, 2012. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking
statements for any reason.
regarding AngioDynamics’ expected future financial position, results of operations, cash flows, business strategy, budgets, projected costs, capital
expenditures, products, competitive positions, growth opportunities, plans and objectives of management for future operations, as well as
statements that include the words such as “expects,” “reaffirms” “intends,” “anticipates,” “plans,” “believes,” “seeks,” “estimates,” “optimistic,” or
variations of such words and similar expressions, are forward-looking statements. These forward looking statements are not guarantees of future
performance and are subject to risks and uncertainties. Investors are cautioned that actual events or results may differ from AngioDynamics’
expectations. Factors that may affect the actual results achieved by AngioDynamics include, without limitation, the ability of AngioDynamics to
develop its existing and new products, technological advances and patents attained by competitors, future actions by the FDA or other regulatory
agencies, domestic and foreign health care reforms and government regulations, results of pending or future clinical trials, overall economic
conditions, the results of on-going litigation, the effects of economic, credit and capital market conditions, general market conditions, market
acceptance, foreign currency exchange rate fluctuations, the effects on pricing from group purchasing organizations and competition, the ability of
AngioDynamics to integrate purchased businesses, as well as the risk factors listed from time to time in AngioDynamics’ SEC filings, including but
not limited to its Annual Report on Form 10-K for the year ended May 31, 2011 and its Quarterly Report on Form 10-Q for the fiscal quarters ended
November 30, 2011 and February 29, 2012. AngioDynamics does not assume any obligation to publicly update or revise any forward-looking
statements for any reason.
In the United States, NanoKnife has been cleared by the FDA for use in the surgical ablation of soft tissue. NanoKnife has not been cleared for the
treatment or therapy of a specific disease or condition. This document may discuss the use of NanoKnife for specific clinical indications for which it
is not cleared in the United States at this time.
treatment or therapy of a specific disease or condition. This document may discuss the use of NanoKnife for specific clinical indications for which it
is not cleared in the United States at this time.
Notice Regarding Non-GAAP Financial Measures
Q4 and FY 2012 Investor Call
July 12, 2012
Q4 and FY 2012 Investor Call
July 12, 2012
AngioDynamics, the AngioDynamics logo and other trademarks displayed in this presentation are trademarks owned and used by AngioDynamics, Inc. © Copyright 2012 AngioDynamics, Inc. All rights reserved.
4
AGENDA
Integration Update
Quality Call to Action Update
Outlook for FY 2013 and Beyond
Q4 Accomplishments
Q4 and FY 2012 Review
5
Q4 ACCOMPLISHMENTS
• Closed acquisition of Navilyst; Integration on schedule
• Grew VenaCure EVLT™ 17%
• Grew NanoKnife® 54%
• Grew International business 22%(1)
• Published two new NanoKnife® studies
• Commenced Microsulis international distribution agreement
• Launched Embarc™ microcatheter and Charter guidewire
• Signed 3 yr contract with HealthPRO, Canada’s largest GPO, due to BioFlo™
• Hired new CTO
(1) Constant currency and excluding Navilyst.
6
• Significant pre-closing planning effort paying off
• $5-7 million in FY13 cost savings accomplished
• Most organizational changes completed
• Management team now in place - best talent from both organizations
o New CTO
o New Head of Quality
• Creation of three global businesses to achieve greater focus on customers and markets
INTEGRATION UPDATE
o New Head of Regulatory
o New Head of US Sales
Announcement
Jan 31, 2012
Remainder of
FY13
ü Integration Leadership Office created
ü External consultant retained
ü Significant joint planning conducted
ü $5-7M FY13 synergies validated
ü Prelim org realignment developed
ü 100 day post-closing plan created
q ERP Implementation
q Consolidated global QMS
q Functional shared service consolidation
q Accelerated ops excellence activities
q Ongoing synergy capture
q Rollout of brand refresh
~Day 50
TODAY
Closing
May 22
ü Flawless Day 1 transition
ü S&M org changes implemented
ü G&A org changes implemented
ü CTO hired
ü U.S. & Int’l sales meetings conducted
ü Creation of 3 global businesses
o New Head of Queensbury Manufacturing
o New Medical Director
7
• Up to date on all QCTA objectives and commitments to the FDA
• Significantly improved quality capabilities through acquisition of Navilyst
QUALITY CALL TO ACTION UPDATE
COST AND GROSS MARGIN IMPACT OF QCTA & PRODUCT RECALLS
¯ 2.6%
Impact
on GM%
on GM%
¯ 2.5%
¯ 4.3%
Impact
on GM%
on GM%
Impact
on GM%
on GM%
¯ 1.4%
¯ 0.6%
Impact
on GM%
on GM%
Impact
on GM%
on GM%
8
Q4 REVIEW
9
FY 2012 REVIEW
10
FY 2012 PRO FORMA OPERATING RESULTS
Pro Forma Operating Results:
•Include Navilyst as if combined for all of FY
2012
2012
•Exclude LC Beads and related S&M costs
•Exclude acquisition, restructuring,
financing, QCTA and product recall costs
financing, QCTA and product recall costs
11
The angiodynamics
Mission
A NEW DAY FOR ANGIODYNAMICS…
Vascular
Access
VA
Peripheral
Vascular
PV
Oncology/
Surgery
O/S
• BioFlo™ as a platform technology
• Advanced techniques and procedures
• New technologies
• Automated Fluid Management
• Comprehensive venous strategy
• Thrombolysis/Thrombectomy/PE
• Next generation venous ablation
• NanoKnife® Standard-of-Care
• Microwave
• Interventional Oncology
Three Global Businesses
Focused on Innovation
Focused on Innovation
• Develop innovative, differentiated and high
quality products for clinicians and patients
quality products for clinicians and patients
• Focus our investments in product categories
and geographic markets that offer
sustainable, profitable growth
and geographic markets that offer
sustainable, profitable growth
• Enhance our profitability by driving operation
excellence across the entire organization
excellence across the entire organization
Grow revenues 8-10%
Grow earnings at a mid teens rate
Long-term Financial
Objectives
12
FY13 OUTLOOK FOR OUR GLOBAL BUSINESSES
13
PERIPHERAL VASCULAR BUSINESS
Reinvigorate
NAMIC
NAMIC
Expand
Ablation
Grow
Core
PV
• Channel Synergy
- Fluid Mgmt in IR/Vascular
- Venous Ablation in Cardiology
- Core Products in Cardiology
• NeverTouch Direct™ Launch
+
=
FY 2013
Strategic
Objectives
Key Growth
Drivers
Financial
Expectations
(1) Pro Forma sales exclude LC Beads and include Navilyst as if combined for all of FY12.
14
VASCULAR ACCESS BUSINESS
Penetrate &
Convert
Convert
BIOFLO BIOFLO
BIOFLO
BIOFLO
VA
• BioFlo™ PICCs
(pending 510(k) clearance)
(pending 510(k) clearance)
• BioFlo™ Ports
(pending 510(k) clearance)
(pending 510(k) clearance)
• BioFlo™ Dialysis
(pending 510(k) clearance)
(pending 510(k) clearance)
• Strategic Acquisitions
+
=
FY 2013
Strategic
Objectives
Key Growth
Drivers
Financial
Expectations
(1) Pro Forma sales exclude LC Beads and include Navilyst as if combined for all of FY12.
15
BIOFLO™ TECHNOLOGY
Coatings
Impregnated
(in the pores)
Current Next Generation PICC Technologies
NO HEPARIN
NO ANTIBIOTICS
NOT A COATING
NOT ELUTING
Minimizes complications associated w/ heparin
Reduces risks associated w/ bacterial resistance
Present throughout entire catheter
Present for life of device
Unlike other technologies
that are superficial and/or
transient, BioFlo is designed
to be both integral to the
catheter and permanent
that are superficial and/or
transient, BioFlo is designed
to be both integral to the
catheter and permanent
The BioFlo™ Advantage…
VA
NOTE: BioFlo is pending 510(k) clearance in the U.S. Approved in Canada and CE Marked.
16
BIOFLO™ TECHNOLOGY (cont’d)
Head-to-Head
BARD PowerPICC Solo2®
vs.
BioFlo™ with PASV® PICC
|
Metric
|
PowerPICC Solo 2
|
BioFlo w/ PASV
|
|
PICCs Placed
|
60
|
133
|
|
Occlusion Rate
|
9.63/1,000 catheter days
|
4.96/1,000 catheter days
|
|
T-PA Usage Rate
|
12.84 doses/1,000 catheter days
|
7.93 doses/1,000 catheter days
|
|
DVT Rate
|
0.80/1,000 catheter days
|
0.50/1,000 catheter days
|
BioFlo™ Demonstrated:
VA
• 48% reduction in occlusions
• 38% reduction in t-PA use
• 37% reduction in DVT
NOTE: Preliminary retrospective data analysis conducted outside the U.S. by independent investigator. BioFlo is pending 510(k) clearance in the U.S.
Approved in Canada and CE Marked.
Approved in Canada and CE Marked.
Early Customer Evaluation of BioFlo™
17
ONCOLOGY / SURGERY BUSINESS
Drive NanoKnife
Adoption
Adoption
Deliver the Most
Comprehensive
Ablation Solution
Comprehensive
Ablation Solution
O/S
• NanoKnife® Data
• International Microwave
• Embarc™ Microcatheter and
Charter™ Guidewire launches
Charter™ Guidewire launches
• Strategic Transactions
+
=
FY 2013
Strategic
Objectives
Key Growth
Drivers
Financial
Expectations
Continue to Fill
Channel
Channel
(1) Pro Forma sales exclude LC Beads and include Navilyst as if combined for all of FY12.
18
NANOKNIFE® PROPOSED PANCREATIC IDE TRIAL
HEAD-TO-HEAD EVALUATION
Gemcitabine
vs.
NanoKnife®
+ Gemcitabine
in patients with uncresectable
pancreatic cancer
pancreatic cancer
• Randomized controlled trial
• Comparison vs. standard-of-care (gemcitabine)
• 190 patients w/ confirmed stage III disease
• Primary endpoint: local PFS
• Secondary endpoints: response rate, QOL, VAS
• Expected start date: 1H FY13
• Enrollment: ~24 months
O/S
19
Oncology/
Surgery
Peripheral
Vascular
Vascular
Access
A NEW U.S. GO-TO-MARKET STRATEGY
VP Sales
Area
Sales
Director
Sales
Director
VA
Sales Rep
PV
Sales Rep
O/S
Sales Rep
Regional/
Specialized
Selling Teams
Selling Teams
U.S. Commercial Ops
Global Businesses
Customers
GPOs
Unified
Sales
Mgmt
IHN/IDN
Hospitals
CEOs/CFOs/
Purchasing Managers
Doctors
IRs/ICs/
Surgeons/Nurses
VA
Specialist
PV
Specialist
O/S
Specialist
Clinical Specialists
Regional
Managers
20
FY13 FINANCIAL GUIDANCE
Key FY13 Objectives
• Drive sales synergies with new
call points and more focused
sales efforts
call points and more focused
sales efforts
• Meet/exceed cost saving goals
by aggressively implementing
the integration program
by aggressively implementing
the integration program
• Strong product launches of
BioFlo™ in the U.S., NeverTouch
Direct®, Microsulis and
microcatheters
BioFlo™ in the U.S., NeverTouch
Direct®, Microsulis and
microcatheters
• Make tuck-in acquisitions to
accelerate sales and earnings
growth
accelerate sales and earnings
growth
(1) Pro Forma operating results (i) exclude LC Beads and related S&M costs, (ii) exclude acquisition, restructuring, finance, QCTA and product recall costs
and (iii) include Navilyst as if combined for all of FY12.
and (iii) include Navilyst as if combined for all of FY12.
21
FINANCIAL ASPIRATIONS FOR FY14 AND BEYOND
Key Long-term Objectives
•NanoKnife as standard of care
•Continue to introduce innovative
products and technologies, including
automated fluid management
systems, next-generation ablation
solutions and venous intervention
products
products and technologies, including
automated fluid management
systems, next-generation ablation
solutions and venous intervention
products
•Sustained international expansion
and penetration
and penetration
•Realization of longer-term
operational excellence initiatives
operational excellence initiatives
Q4 and FY 2012 Investor Call
July 12, 2012
AngioDynamics, the AngioDynamics logo and other trademarks displayed in this presentation are trademarks owned and used by AngioDynamics, Inc. © Copyright 2012 AngioDynamics, Inc. All rights reserved.
23
APPENDICES
Business Development Summary:
• 18 active discussions 1
- $750M- $1.5B of cumulative 5-yr sales
• Relatively balanced portfolio
- Stage of development:
Ø 8 (45%) Commercial; 10 (55%) R&D 1
- Business Focus:
Ø 8 (45%) Vascular; 10 (55%) Oncology 1
• Most Oncology targets are fairly small
- $350M - $500M of cum. 5-yr sales
- Only Microsulis >$50M of cum. 5-yr sales
>> Reconciliation Tables
24
Reconciliation of Net Income to non-GAAP Net Income
- Only Microsulis >$50M of cum. 5-yr sales
25
Reconciliation of Diluted Earnings (Loss) Per Share to Non-GAAP
Diluted Earnings Per Share
Diluted Earnings Per Share