AngioDynamics Reports 70% Second Quarter Sales Growth
AngioDynamics Reports 70% Second Quarter Sales Growth
QUEENSBURY, N.Y., Jan 03, 2008 (BUSINESS WIRE) -- AngioDynamics (NASDAQ: ANGO), a leading provider of innovative medical devices used by interventional radiologists and surgeons for the minimally invasive treatment of cancer and peripheral vascular disease, today reported financial results for the second quarter of fiscal 2008, which ended on November 30, 2007.
For the second fiscal quarter, the Company reported $41.5 million in net sales, which is 70% higher than the $24.4 million reported for the second quarter of fiscal 2007. The growth in sales includes sales from RITA Medical Systems which was acquired on January 29, 2007. Operating income rose 59% to $4.8 million from $3.0 million for the same period a year ago. Gross margin rose to 61.3% from 58.5% in the prior-year second quarter. Second quarter net income increased 26% to $3.1 million from $2.5 million, while GAAP EPS decreased to $0.13 per share from $0.15 per share from the same period a year ago due to the 53% increase in diluted shares outstanding primarily related to the acquisition of RITA Medical Systems.
"We had another excellent quarter where we executed and delivered results in line with our expectations," said Eamonn Hobbs, president and chief executive officer. "Net sales were 70% higher over the same period last year. We are particularly pleased with the 20% year over year sales growth in our vascular access ports business and the 26% year over year sales growth, on a pro forma basis, of our oncology products group."
"The quarter featured strong sales performance from the Habib®
electrosurgical device, Morpheus® CT PICC and bedside insertion kit,
SmartPort vascular access port, Profiler® balloon dilatation
catheter and LC Beads embolization particles. Second quarter
fiscal 2008 AngioDynamics product lines sales faced a very difficult
comparison and grew 7% over the prior year period. The difficult
comparison resulted after AngioDynamics product lines sales grew 30%
in the second quarter of fiscal 2007 over the same period of fiscal
2006. Based on current trends, we believe that the AngioDynamics
product lines sales will grow at least 15% year over year during the
third quarter of fiscal 2008," continued Mr. Hobbs.
Of the $41.5 million in second quarter net sales, AngioDynamics products constituted $26.2 million and RITA Medical products constituted $15.3 million. AngioDynamics product sales grew 7% in the second quarter over the year ago quarter. On a pro forma basis, RITA Medical product sales grew 18% in the second quarter versus the comparable period a year ago.
For the first half of fiscal 2008, net sales were $79.0 million, which is 77% higher than net sales of $44.6 million in the first half of fiscal 2007, and reflected sales gains across the Company's diverse product portfolio. Net income for the first half of fiscal 2008 was $5.5 million, up 26% over net income of $4.4 million in the comparable fiscal 2007 period, and diluted earnings per share were $0.23, compared to $0.27 earnings per share a year ago.
The Company continued to execute on its product development and research plans. During the second quarter of fiscal 2008, the Company:
-- Highlighted a study outlining a significant 5-year survival rate after the ablation of colorectal liver metastases published in the October 2007 issue of the Annals of Surgery.
-- Received a U.S. Patent that covers its endovascular laser treatment device with a spacer that positions the fiber tip away from the vessel wall, and for the method of using that device.
-- Made preparations to provide its venous product line customers with uninterrupted supply regardless of the outcome of pending litigation.
-- Continued to work alongside Oncobionic on the Irreversible Electroporation (IRE) development program which uses needles and image guidance similar to existing thermal ablation technologies, but instead of 'cooking' or 'freezing' the targeted tissue, IRE disrupts the cell membrane, thereby destroying the targeted cells. Important new parameters and stricter requirements were added to the human trials focused on malignant prostate cancer which are expected to be performed by a leading clinician based in Italy in calendar 2008.
Fiscal 2008 Guidance
The Company affirmed its outlook for fiscal 2008:
-- Net sales in the range of $170-$175 million
-- Gross profit margin in the range of 61-62%
-- The completion of the RITA Medical integration is expected to yield $9 million in cost savings in fiscal 2008
-- GAAP operating income in the range of $20-$22 million
-- GAAP EPS in the range of $0.56-$0.60
-- Non-GAAP adjusted income of at least $30 million. Non-GAAP adjusted income excludes stock-based compensation, amortization of intangibles and includes the cash benefit from the use of NOLs.
Conference Call
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 (800) 218-0204 from the U.S. or
(303) 262-2142 from outside the U.S.
In addition, individuals can listen to the call on the Internet by visiting the investor relations portion of the Company's Web site at http://investor.angiodynamics.com. To listen to the live call, please go to the website 15 minutes prior to its start to register, download, and install the necessary audio software.
A replay will be available on the website. A telephone replay of the call will be available from 7:30 p.m. Eastern Time today through 11:59 p.m. Eastern Time on January 11 by dialing (800) 405-2236 from the U.S. or (303) 590-3000 from outside the U.S., and entering the passcode 11104157.
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 adjusted income and adjusted EPS. Adjusted income and adjusted EPS excludes certain non-cash expenses relating to the acquisition of RITA Medical, stock-based compensation expense (net of tax), and includes the cash benefit from the use of acquired net operating losses. 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 financial results 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 include forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Words such as "expects," "reaffirms," "anticipates," "plans," "believes," "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, timing associated with initiation or completion of its clinical trials, 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 2, 2007, may affect the actual results achieved by the Company.
About AngioDynamics
AngioDynamics, Inc. 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 Six months ended
------------------ -----------------
Nov 30, Dec 2, Nov 30, Dec 2,
2007 2006 2007 2006
-------- --------- -------- --------
(unaudited) (unaudited)
Net Sales $41,497 $ 24,369 $79,023 $44,634
Cost of sales (1) 16,042 10,125 31,067 18,464
-------- --------- -------- --------
Gross Profit 25,455 14,244 47,956 26,170
-------- --------- -------- --------
% of Net Sales 61.3% 58.5% 60.7% 58.6%
Operating Expenses
Research and development (1) 3,694 1,637 6,405 3,264
Sales and marketing (1) 11,267 6,689 21,815 12,419
General and administrative (1) 4,063 2,809 8,195 5,524
Amortization of purchased
intangibles 1,641 105 3,229 136
-------- --------- -------- --------
Total operating expenses 20,665 11,240 39,644 21,343
-------- --------- -------- --------
Operating Income 4,790 3,004 8,312 4,827
Other income, net 163 1,049 450 2,219
-------- --------- -------- --------
Income before income taxes 4,953 4,053 8,762 7,046
Provision for income taxes 1,853 1,599 3,282 2,693
-------- --------- -------- --------
Net Income $ 3,100 $ 2,454 $ 5,480 $ 4,353
======== ========= ======== ========
Earnings per common share
Basic $ 0.13 $ 0.16 $ 0.23 $ 0.28
Diluted $ 0.13 $ 0.15 $ 0.23 $ 0.27
Weighted average common shares
Basic 24,034 15,646 24,002 15,573
Diluted 24,365 15,908 24,315 15,881
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(in thousands, except per share data)
Three months ended Six months ended
------------------ -----------------
Nov 30, Dec 2, Nov 30, Dec 2,
2007 2006 2007 2006
--------- -------- -------- --------
(unaudited) (unaudited)
(1) Includes stock-based
compensation charges of:
Cost of sales $ 162 $ 101 $ 315 $ 190
Research and development 213 140 403 265
Sales and marketing 400 218 725 376
General and administrative 561 315 1,103 586
--------- -------- -------- --------
Total stock-based
compensation 1,336 774 2,546 1,417
Less: tax benefit (399) (275) (777) (496)
--------- -------- -------- --------
Net stock-based compensation $ 937 $ 499 $ 1,769 $ 921
========= ======== ======== ========
Reconciliation of Net Income to non-GAAP adjusted income:
Net Income $ 3,100 $ 2,454 $ 5,480 $ 4,353
Stock-based compensation 1,336 774 2,546 1,417
Amortization of purchased
intangibles 1,641 105 3,229 136
Cash benefit from use of NOL's 1,660 - 2,990 -
--------- -------- -------- --------
Adjusted income before taxes 7,737 3,333 14,245 5,906
Effect of income taxes (399) (275) (777) (496)
--------- -------- -------- --------
Adjusted income $ 7,338 $ 3,058 $13,468 $ 5,410
========= ======== ======== ========
Adjusted income per common share
Basic $ 0.31 $ 0.20 $ 0.56 $ 0.35
Diluted $ 0.30 $ 0.19 $ 0.55 $ 0.34
Weighted average common shares
Basic 24,034 15,646 24,002 15,573
Diluted 24,365 15,908 24,315 15,881
ANGIODYNAMICS, INC. AND SUBSIDIARIES
NET SALES BY PRODUCT CATEGORY AND BY GEOGRAPHY
(in thousands)
Three months ended Six months ended
------------------ ----------------
Nov 30, Dec 2, Nov 30, Dec 2,
2007 2006 2007 2006
--------- -------- -------- -------
(unaudited) (unaudited)
Net Sales by Product Category
Interventional Products $ 32,135 $ 24,369 $ 61,038 $44,634
Oncology Products 9,362 - 17,985 -
--------- -------- -------- -------
Total $ 41,497 $ 24,369 $ 79,023 $44,634
========= ======== ======== =======
Net Sales by Geography
United States $ 37,588 $ 23,264 $ 71,596 $42,823
International 3,909 1,105 7,427 1,811
--------- -------- -------- -------
Total $ 41,497 $ 24,369 $ 79,023 $44,634
========= ======== ======== =======
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands)
Nov 30, Jun 2,
2007 2007
----------- -----------
(unaudited) (2)
Assets
Current Assets
Cash and cash equivalents $ 22,759 $ 28,313
Restricted cash 11,195 1,786
Marketable securities 45,612 43,191
----------- -----------
Total cash and investments 79,566 73,290
Receivables, net 22,216 20,798
Inventories, net 27,527 28,007
Deferred income taxes 2,317 2,247
Prepaid expenses and other 2,802 2,957
----------- -----------
Total current assets 134,428 127,299
Property, plant & equipment, net 19,242 16,832
Intangible assets, net 48,026 49,148
Goodwill 154,430 153,787
Deferred income taxes 27,095 29,289
Other non-current assets 9,599 6,926
----------- -----------
Total Assets $ 392,820 $ 383,281
=========== ===========
Liabilities and Stockholders' Equity
Current portion of long-term debt $ 10,040 $ 315
Litigation provision 10,031 9,790
Other current liabilities 19,554 20,103
Long-term debt, net of current portion 7,245 17,115
----------- -----------
Total Liabilities 46,870 47,323
Stockholders' equity 345,950 335,958
----------- -----------
Total Liabilities and Stockholders' Equity $ 392,820 $ 383,281
=========== ===========
Shares outstanding 24,082 23,962
(2) Derived from audited financial statements
ANGIODYNAMICS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
Six months ended
-------------------
Nov 30, Dec 2,
2007 2006
--------- ---------
(unaudited)
Cash flows from operating activities:
Net income $ 5,480 $ 4,353
Depreciation and amortization 4,323 699
Tax benefit from exercise of stock options 186 141
Deferred income taxes 2,105 (416)
Stock-based compensation 2,546 1,417
Other 291 68
Changes in operating assets and liabilities
Accounts receivable (1,626) (979)
Inventories (19) (2,719)
Accounts payable and accrued liabilities (901) 834
Other (2,106) 1,620
--------- ---------
Net cash provided by operating activities 10,279 5,018
--------- ---------
Cash flows from investing activities:
Additions to property, plant and equipment (3,554) (600)
Acquisition of intangible assets and business (2,488) (7,575)
Change in restricted cash (9,409) -
Purchases of marketable securities, net (1,983) 11,184
--------- ---------
Net cash (used in) provided by investing
activities (17,434) 3,009
--------- ---------
Cash flows from financing activities:
Repayment of long-term debt (145) (90)
Proceeds from exercise of stock options and ESPP 1,721 1,130
Other 25 49
--------- ---------
Net cash provided by financing activities 1,601 1,089
--------- ---------
Increase (decrease) in cash and
equivalents (5,554) 9,116
Cash and cash equivalents
Beginning of period 28,313 64,042
--------- ---------
End of period $ 22,759 $ 73,158
========= =========
SOURCE: AngioDynamics, Inc.
AngioDynamics, Inc.
D. Joseph Gersuk, CFO, 800-772-6446 x1608
jgersuk@AngioDynamics.com
or
Investor Relations:
EVC Group, Inc.
Doug Sherk, 415-896-6820
dsherk@evcgroup.com
Julie Huang, 646-443-6963
jhuang@evcgroup.com
or
Media:
EVC Group, Inc.
Steve DiMattia, 646-201-5445
sdimattia@evcgroup.com