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 18, 2007
AngioDynamics, Inc.
(Exact Name of Registrant as Specified in Charter)
Delaware 000-50761 11-3146460
(State or Other Jurisdiction (Commission File (IRS Employer
of Incorporation) Number) 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:
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2 (b))
|_| 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 24, 2007, AngioDynamics, Inc. (the "Company") issued a press
release, a copy of which is attached as Exhibit 99.1, announcing its financial
results for the fourth quarter and fiscal year ended June 2, 2007 and that it
will hold a conference call beginning at 4:30 p.m. Eastern time, which will also
be webcast live, to discuss the announcement.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year
On July 18, 2007, pursuant to the Company's amended and restated
bylaws, the Board of Directors of the Company unanimously approved a change in
the Company's fiscal year beginning in fiscal year 2008 to establish fiscal
quarters that will end on August 31, November 30, February 28 (or 29 as the case
may be), and May 31. Results for the fiscal year ended June 2, 2007 will be
filed with the Securities and Exchange Commission on Form 10-K on or prior to
August 16, 2007 and results for the period from June 3, 2007 to August 31, 2007
will be filed with the Securities and Exchange Commission on Form 10-Q on or
prior to October 10, 2007.
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 "may," "will," "predict,"
"project," "might," "expect," "believe," "anticipate," "plan," "intend,"
"potential," "could," "would," "should," "estimate," "seek," "continue,"
"pursue," or "our future success depends," or the negative or other variations
thereof or comparable terminology. In particular, they include statements
relating to, among other things, future actions, strategies, future performance,
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 June 3, 2006 and Form 10-Q for the period ended March 3, 2007,
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 patent
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, 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 24, 2007.
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 25, 2007 By: /s/ Joseph Gersuk
---------------------------------
Joseph Gersuk
Chief Financial Officer
5
EXHIBIT INDEX
Exhibit No. Description
- ----------- -----------
99.1 Press Release dated July 24, 2007.
EXHIBIT 99.1
[ANGIODYNAMICS LOGO GRAPHIC OMITTED]
COMPANY CONTACT: INVESTOR RELATIONS CONTACTS: MEDIA CONTACT:
AngioDynamics, Inc. EVC Group, Inc. EVC Group, Inc.
Joseph Gersuk, CFO Jennifer Beugelmans/Doug Sherk Steve DiMattia
(800) 772-6446 x1608 (646) 201-5447 (646) 201-5445
jgersuk@angiodynamics.com jbeugelmans@evcgroup.com sdimattia@evcgroup.com
- ------------------------- ------------------------ ----------------------
dsherk@evcgroup.com
-------------------
ANGIODYNAMICS REPORTS FOURTH QUARTER AND FISCAL 2007 RESULTS
o Fourth Quarter Net Sales Up 73% to $40.9 Million
o Fourth Quarter GAAP Net Income Grows 43.5% to $2.9 Million
o Fourth Quarter Adjusted (Non-GAAP) Income Increases 225% to $6.9 Million
or $0.29 Per Share
o Fourth Quarter Cash Flow from Operations of $5.3 Million
o On Plan to Achieve Projected FY08 RITA Medical Cost Savings of $9 Million
o Additional Fiscal 2008 Guidance Provided
QUEENSBURY, N.Y. JULY 24, 2007--ANGIODYNAMICS (NASDAQ: ANGO), a leading
provider of innovative medical devices used by interventional radiologists
and surgeons for the minimally invasive treatment of peripheral vascular
disease and cancer, today reported financial results for the fourth quarter
and fiscal year ended June 2, 2007. Financial results include RITA Medical,
from January 29, 2007, the date of acquisition.
For the fourth fiscal quarter, the Company reported $40.9 million in net
sales, a 73% increase over the $23.6 million reported for the same period one
year ago. Fourth quarter net income increased to $2.9 million from $2.0
million, while GAAP EPS decreased to $0.12 per share from $0.15 per share due
to the additional shares issued in conjunction with the RITA Medical
acquisition. Adjusted (non-GAAP) EPS, which excludes stock based
compensation, amortization of intangibles, and other items detailed in the
tables included in this release, increased to $0.29 per share from $0.16 per
share a year ago. AngioDynamics products constituted $26.3 million of fourth
quarter net sales and RITA Medical products constituted $14.6 million.
AngioDynamics product sales grew 11% in the fourth quarter compared with the
fourth quarter of fiscal 2006. There were five fewer business days in the
fourth quarter of fiscal 2007 than in the fourth quarter of 2006. On an
adjusted, average daily sales basis, AngioDynamics product sales grew 20%
during the fourth quarter compared with the same quarter of last year. On a
pro forma basis, RITA Medical sales grew 14% during the fourth quarter versus
the comparable period of a year ago.
"We achieved solid financial performance during the fourth quarter,
especially in light of the disappointing jury verdict regarding our
VenaCure(R) product line," commented Eamonn P. Hobbs, president and chief
executive officer of AngioDynamics. "Our positive financial results
illustrate the significant progress we have made in integrating RITA Medical
as well as the growth generated from product lines outside of VenaCure. We
were pleased by our sales team's ability to regain market momentum for our
RITA Medical ports product line as well as the strong sales growth in the
Sotradecol(R), PTA and TOTAL ABSCESSION(R) drainage product lines. In
addition, our oncology business, led by our embolization bead and Habib(TM)
product lines, also posted impressive sales.
"Following the jury verdict in the `777 patent litigation dispute with
Diomed, we successfully launched our NeverTouch(TM) VenaCure product,"
continued Mr. Hobbs. "This required us to reach into our R&D pipeline and
rapidly commercialize and introduce our product so that we could continue to
serve the venous disease market. This new product has had a positive
reception in the marketplace and we are excited about its opportunities over
the long term. Despite our rapid recovery and execution of our strategy,
there was an interruption to fourth quarter venous product sales.
Nonetheless, we were able to achieve the sales guidance projected prior to
the jury verdict, which we believe illustrates the benefits of a broad
product line and a very capable sales force," said Mr. Hobbs.
FOURTH QUARTER HIGHLIGHTS
o Grew interventional product sales by 36% to $32.1 million, with 20% growth
in the AngioDynamics product sales on an adjusted, average daily sales
basis
o Substantially completed the integration of RITA Medical into AngioDynamics
operations and systems
o Finalized consolidation actions to achieve the anticipated $9 million in
cost savings from the RITA Medical operations in fiscal 2008
o Successfully launched the NeverTouch(TM) VenaCure(R) product on June 2,
2007
o Expanded the PTA Balloon Dilation Catheter Portfolio with launch of
Profiler(R)
o Promoted industry veteran, John Soto, to lead global sales team
o Appointed Joseph Gersuk, who brought more than 25 years of senior financial
executive experience, to the role of chief financial officer
FISCAL YEAR RESULTS
For fiscal year 2007, The Company reported $112.2 million in net sales, a 43%
increase over the $78.5 million reported a year ago. Of the $112.2 million in
net sales for fiscal 2007, AngioDynamics products constituted $93.6 million
and RITA Medical products constituted $18.6 million. AngioDynamics product
sales grew 19% over the prior fiscal year. The net loss for fiscal 2007,
inclusive of the accounting for the acquisition of RITA Medical, litigation
damages, and stock based compensation was $9.1 million, or $0.49 per share.
FISCAL 2008 GUIDANCE
o Net sales in the range of $170- $175 million
o Approximately 45% of sales expected during the first half of the
fiscal year and 55% of sales expected during the second half of the
fiscal year; first quarter expected to be lowest sales quarter
o Gross profit margin in the range of 61-62%
o GAAP operating income in the range of $20-$22 million
o GAAP EPS in the range of $0.56 - $0.60
o Non-GAAP income of at least $30 million. Non-GAAP income excludes
stock-based compensation, amortization of intangibles and includes
the cash benefit from the use of NOLs.
The Company also announced today that it has changed its fiscal period to end
on the last day of the calendar month. Effective beginning in fiscal 2008,
fiscal quarters will end on August 31, November 30, February 28 or 29, and
the fiscal year will end on May 31.
"In many ways fiscal 2007 was an extraordinary year for AngioDynamics,"
continued Mr. Hobbs. "The year was highlighted by our January acquisition of
RITA Medical and the associated broadening of the AngioDynamics' product
lines to include leading edge oncology products. The acquisition brings a
talented team that complements the experienced and proven team at
AngioDynamics. I would like to thank all of our employees for their hard work
and enthusiasm this past year in the face of many challenges. I am extremely
proud of our team and am excited by the momentum we have as we pursue our
goal of long-term industry leadership," concluded Mr. Hobbs.
CONFERENCE CALL INFORMATION
AngioDynamics management will host a conference call to discuss this
announcement today beginning at 4:30 p.m. Eastern time. To participate in the
call, please dial (888) 713-4209 from the U.S. or (617) 213-4863 from outside
the U.S. Please enter passcode 25543109.
A telephone replay of the call will be available from 6:30 p.m. Eastern time
today through 11:59 p.m. Eastern time on July 31, 2007 by dialing (888)
286-8010 from the U.S. or (617) 801-6888 from outside the U.S., and entering
the passcode 16976535.
In addition, individuals can listen to the call on the Internet by visiting
the investor relations portion of the Company's Web site at.
www.angiodynamics.com. A recording of the conference call will be archived
there for 12 months.
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 the Company's 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, the Company has reported non-GAAP measures,
adjusted income and adjusted EPS. Adjusted income and adjusted EPS excludes
certain expenses relating to the acquisition of RITA Medical, stock-based
compensation expense, litigation damages, and includes the cash benefit from
the use of acquired net operating losses, and assumed taxes on net income
using a 39% tax rate, where applicable. 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
the Company's performance over different periods, particularly when comparing
this period to periods in which the Company did not incur any expenses
relating to these activities or items. By using these non-GAAP measures,
management believes that investors get a better picture of the performance of
the Company's underlying business. Management encourages investors to review
the Company's net loss prepared in accordance with GAAP to understand the
Company's performance taking into account all relevant factors, including
those that may only occur from time to time but have a material impact on the
Company's financial results. Please see the tables that follow for a
reconciliation of GAAP to non-GAAP measures.
SAFE HARBOR
The statements made in this document contain certain forward-looking
statements that involve a number of risks and uncertainties. Words such as
"expects," "intends," "anticipates," "plans," "believes," "seeks,"
"estimates," or variations of such words and similar expressions, are
intended to identify such forward-looking statements. Investors are cautioned
that actual events or results may differ from the Company's expectations. 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 patent
litigation, overall economic conditions, general market conditions, market
acceptance, foreign currency exchange rate fluctuations, the effects on
pricing from group purchasing organizations and competition, as well as the
risk factors listed from time to time in the SEC filings of AngioDynamics,
including but not limited to its Annual Report on Form 10-K for the year
ended June 3, 2006, may affect the actual results achieved by the Company.
ABOUT ANGIODYNAMICS
AngioDynamics is a leading provider of innovative medical devices used by
interventional radiologists, surgeons, and other physicians for the minimally
invasive treatment of cancer and peripheral vascular disease. The Company's
diverse product line includes market-leading radiofrequency ablation systems,
vascular access products, angiographic products and accessories, dialysis
products, angioplasty products, drainage products, thrombolytic products,
embolization products and venous products. More information is available at
www.angiodynamics.com.
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
Three months ended Fiscal Year ended
----------------------------------- --------------------------------------
June 2, June 3, June 2, June 3,
2007 2006 2007 2006
---------------- ---------------- ----------------- ----------------
(unaudited) (unaudited) (3)
Net Sales $ 40,855 $ 23,592 $ 112,227 $ 78,451
Cost of sales (1) (2) 16,807 9,985 46,060 32,930
---------------- ---------------- ----------------- ----------------
Gross Profit 24,048 13,607 66,167 45,521
% of Net Sales 58.9% 57.7% 59.0% 58.0%
Research and development (1) (2) 3,043 1,359 20,555 5,869
Sales and marketing (1) (2) 11,138 6,378 31,605 21,399
General and administrative (1) (2) 4,077 2,735 13,172 7,779
Litigation damages 110 - 9,710 -
Amortization of purchased intangibles 1,648 31 2,350 168
---------------- ---------------- ----------------- ----------------
Total operating expenses 20,016 10,503 77,392 35,215
---------------- ---------------- ----------------- ----------------
Operating Income (Loss) 4,032 3,104 (11,225) 10,306
Other income (expense) net 790 221 4,053 816
---------------- ---------------- ----------------- ----------------
Income (loss) before income taxes 4,822 3,325 (7,172) 11,122
Provision for income taxes 1,897 1,287 1,955 4,256
---------------- ---------------- ----------------- ----------------
Net Income (Loss) $ 2,925 $ 2,038 $ (9,127) $ 6,866
================ ================ ================= ================
Earnings (loss) per common share
Basic $ 0.12 $ 0.16 $ (0.49) $ 0.55
Diluted $ 0.12 $ 0.15 $ (0.49) $ 0.53
Weighted average common shares
Basic 23,934 12,724 18,444 12,378
Diluted 24,211 13,218 18,444 12,965
(1) Includes stock-based compensation charges of:
Cost of sales 157 13 476 44
Research and development 177 45 615 166
Sales and marketing 289 31 966 101
General and administrative 445 41 1,441 141
---------------- ---------------- ----------------- ----------------
Total stock-based compensation 1,068 130 3,498 452
Less: tax benefit (304) (46) (1,126) (159)
---------------- ---------------- ----------------- ----------------
Net stock-based compensation $ 764 $ 84 $ 2,372 $ 293
================ ================ ================= ================
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
Three months ended Fiscal Year ended
---------------------------- ----------------------------
June 2, June 3, June 2, June 3,
2007 2006 2007 2006
------------ ------------- ------------ ------------
(unaudited) (unaudited) (3)
(2) Includes acquisition-related expense of:
Cost of sales - - 11 -
Research and development - - 12,125 -
Sales and marketing - - 18 -
General and administrative 55 - 862 -
------------ ------------- ------------ ------------
Total acquisition related expenses 55 - 13,016 -
Less: tax benefit (21) - (348) -
------------ ------------- ------------ ------------
Net acquisition related expenses 34 - 12,668 -
============ ============= ============ ============
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP ADJUSTED INCOME:
Net Income (Loss) $ 2,925 $ 2,038 $ (9,127) $ 6,866
Stock-based compensation 1,068 130 3,498 452
In-process R&D expense - - 12,100 -
Litigation damages 110 - 9,710 -
Amortization of inventory step-up 894 - 1,192 -
Amortization of purchased intangibles 1,648 31 2,350 168
Cash benefit from use of NOL's 1,609 - 1,609 -
Acquisition related expenses 55 - 916 -
------------ ------------- ------------ ------------
Adjusted income before taxes 8,309 2,199 22,248 7,486
Effect of income taxes (1,363) (61) (6,440) (236)
------------ ------------- ------------ ------------
Adjusted income $ 6,946 $ 2,138 $ 15,808 $ 7,250
============ ============= ============ ============
Adjusted income per common share
Basic $ 0.29 $ 0.17 $ 0.86 $ 0.59
Diluted $ 0.29 $ 0.16 $ 0.84 $ 0.56
Weighted average common shares
Basic 23,934 12,724 18,444 12,378
Diluted 24,211 13,218 18,749 12,965
(3) Derived from audited financial statements
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
June 2, June 3,
2007 2006
------------------ ------------------
(unaudited) (3)
Assets
Current Assets
Cash and equivalents $ 28,313 $ 64,042
Marketable securities 43,191 25,710
Restricted cash 1,786 -
Receivables, net 20,798 13,486
Inventories, net 28,569 15,968
Deferred income taxes 2,247 822
Other current assets 2,957 2,128
------------------ ------------------
Total current assets 127,861 122,156
Property, plant & equipment, net 16,832 10,802
Intangible assets, net 49,148 3,565
Goodwill 153,787 -
Deferred income taxes 29,289 386
Other non-current assets 6,364 91
------------------ ------------------
Total Assets $ 383,281 $ 137,000
================== ==================
Liabilities and Stockholders' Equity
Current liabilities $ 20,418 $ 10,807
Long-term debt 17,115 2,755
Other long-term liabilities 9,790 -
Stockholders' equity 335,958 123,438
------------------ ------------------
Total Liabilities and Stockholders' Equity $ 383,281 $ 137,000
================== ==================
Shares outstanding 23,962 15,469
(3) Derived from audited financial statements
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(dollars in thousands)
Three months ended Fiscal Year ended
----------------------------- -----------------------
June 2, June 3, June 2, June 3,
2007 2006 2007 2006
------------ ------------ --------- -----------
(unaudited) (unaudited) (3)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) income from operating activities 2,925 2,038 (9,127) 6,866
Depreciation and amortization 2,014 326 3,764 1,082
Purchased research and development expense - - 12,100 -
Tax benefit on exercise of stock options (14) 697 597 2,036
Deferred income taxes 1,577 46 (2,818) (18)
Stock-based compensation 1,069 131 3,498 452
Other long-term liabilities 190 - 9,790 -
Other (108) 355 (37) 291
Changes in operating assets and liabilities
Accounts receivable (2,477) (1,489) (1,474) (3,827)
Inventories (1,150) (3,014) (5,884) (5,887)
Other 1,321 (607) (1,625) 2,224
------------ ------------ --------- -----------
Net cash provided by (used in) operating activities 5,347 (1,517) 8,784 3,219
------------ ------------ --------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment (2,836) (740) (5,806) (3,183)
Payment of non-refundable deposit - - (5,139) -
Increase in restricted cash 1,630 - (1,786) -
RITA acquisition, net of cash acquired (393) - (23,712) -
Acquisition of patent rights and licensing agreements (1) (500) (1,533) (2,893)
Purchases of marketable securities, net (14,077) (10,121) (17,066) (13,021)
------------ ------------ --------- -----------
Net cash provided by (used in) investing activities (15,677) (11,361) (55,042) (19,097)
------------ ------------ --------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of long-term debt - - 5,000 -
Repayment of long-term debt (70) (45) (205) (165)
Proceeds from issuance of common stock 62,459 - 62,459
Proceeds from exercise of stock options and ESPP 668 1,368 4,579 3,346
Tax benefit on exercise of stock options (7) - 1,674 -
Other (218) (519) (218)
------------ ------------- ---------- -----------
Net cash provided by (used in) by financing activities 591 63,564 10,529 65,422
------------ ------------- ---------- -----------
Increase/(decrease) in cash and equivalents (9,739) 50,686 (35,729) 49,544
CASH AND CASH EQUIVALENTS
Beginning of period 38,052 13,356 64,042 14,498
------------ ------------- ---------- -----------
End of period 28,313 64,042 28,313 64,042
============ ============= ========== ===========
ANGIODYNAMICS, INC. AND SUBSIDIARIES
NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
(in thousands)
Three months ended Fiscal Year ended
------------------------------------- ------------------------------------
June 2, June 3, June 2, June 3,
2007 2006 2007 2006
---------------- ---------------- --------------- ---------------
(unaudited) (unaudited) (3)
Net Sales by Product Category
Interventional Products $ 32,037 $ 23,592 $ 101,125 $ 78,451
Oncology Products 8,818 - 11,102 -
---------------- ---------------- --------------- ---------------
Total $ 40,855 $ 23,592 $ 112,227 $ 78,451
================ ================ =============== ===============
Net Sales by Geography
United States 37,118 22,678 105,154 75,160
International 3,737 914 7,073 3,291
---------------- ---------------- --------------- ---------------
Total $ 40,855 $ 23,592 $ 112,227 $ 78,451
================ ================ =============== ===============