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8-K - FORM 8-K - SYNERGETICS USA INC | c55074e8vk.htm |
EX-10.2 - EX-10.2 - SYNERGETICS USA INC | c55074exv10w2.htm |
EX-10.1 - EX-10.1 - SYNERGETICS USA INC | c55074exv10w1.htm |
Exhibit 99.1
SYNERGETICS USA, INC.
3845 Corporate Centre Drive
OFallon, Missouri 63368
(636) 939-5100
http://www.synergeticsusa.com
Pamela G. Boone, Chief Financial Officer
3845 Corporate Centre Drive
OFallon, Missouri 63368
(636) 939-5100
http://www.synergeticsusa.com
Pamela G. Boone, Chief Financial Officer
SYNERGETICS ANNOUNCES FIRST QUARTER RESULTS
Reports Growth in International Ophthalmic Sales
Offset by Lower Sales of Capital Equipment Product Lines
OFALLON, MO (December 15, 2009) Synergetics USA, Inc. (NASDAQ: SURG), a medical device company
that designs, manufactures, and markets innovative microsurgical instruments for ophthalmic and
neurosurgical applications, today announced its results for the first quarter ended
October 31, 2009. The Company reported first quarter 2010 sales of $12.1 million and net income of
$542,000.
Our first quarter was affected by lower sales of capital equipment product lines that were
partially offset by continued growth in our international business, stated Dave Hable, President
and CEO of Synergetics USA, Inc. We have experienced lower demand for capital equipment products
due to the soft economy in both domestic and international markets while the sales of our
disposable microsurgical products continue to grow. We believe the continued growth in our
disposable product sales highlights the demand for Synergetics innovative microsurgical
instruments. Our international sales benefited from the expansion of our direct sales force in
Europe and were up 4.5% to $3.7 million compared with the first quarter of last year.
First Quarter Results
First quarter 2010 sales were $12.1 million and were down 0.8% from $12.2 million compared with the
first quarter of 2009. The decrease in first quarter sales from last year was due primarily to
lower sales of capital equipment product lines and lower domestic ophthalmic sales.
| Ophthalmic sales rose 1.9% to $7.5 million compared with the first quarter of fiscal 2009. Domestic ophthalmic sales were down 3.1% and international ophthalmic sales were up 10.2%. The growth in ophthalmic sales benefitted from higher volume of disposable products in both domestic and international markets, partially offset by a decline in capital equipment sales compared with fiscal 2009. | ||
| Neurosurgical sales declined 1.8% to $2.9 million in the first quarter of fiscal 2010 compared with the same period in 2009. Domestic neurosurgical sales increased 2.6% due to increased demand for disposable microsurgical products, offset by a 15.5% decline in international sales. The decline in international sales can be primarily attributed to the decline in sales of neurosurgical capital equipment, specifically the Omni® ultrasonic aspirator line. | ||
| Sales to marketing partners of $1.7 million were 5.2% less than sales in the comparable quarter of the prior year, primarily due to lower sales of capital equipment product lines. Sales of pain control generators to Stryker Corporation (Stryker) during the first quarter of fiscal 2009 were higher than those in the first quarter of fiscal 2010 due to Strykers model change in the prior year period. The sales to Stryker returned to a normal sales rate during the first quarter of fiscal 2010. Sales to Codman & Shurtleff, Inc. (Codman) were down 1.9% due to reduced sales of generator disposables. |
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SURG Reports First Quarter Results
Page 2
December 15, 2009
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December 15, 2009
We signed new contracts with Codman and Stryker during November to market and distribute certain
Synergetics products for neurosurgical applications, continued Mr. Hable. These new agreements
highlight our strategy to transition the marketing of our neurosurgical products from a direct
sales force to industry leaders in this market.
The new contract with Codman extends the exclusive rights for Codman to market and distribute our
disposable bipolar forceps for neurosurgery applications. This relationship is an important part
of ramping up sales for these proprietary forceps. The Stryker agreement extends our marketing
reach for our disposable ultrasonic tips utilized in conjunction with the Sonopet Ultrasonic
Aspirator control console and handpieces used in neurosurgery. We expect this agreement to close
in 2010, continued Mr. Hable.
Gross profit for the first quarter of fiscal 2010 totaled $6.8 million, or 56.1% of sales, compared
with $7.1 million, or 57.8% of sales, in the first quarter of 2009. The change in gross profit and
margin was due primarily to a change in mix toward higher international sales and reduced
absorption of both labor and overhead on our capital equipment product lines.
Operating income for the first quarter of fiscal 2010 was $941,000 compared with $1.2 million in
the first quarter of fiscal 2009. Operating income was reduced due to the decline in gross profit
and a slight increase in sales and marketing expenses, offset partially by lower research and
development expenses compared with the first quarter of the prior year. The Companys research and
development initiatives were revamped in the second half of last year to focus on key projects,
resulting in reduced staffing requirements.
First quarter 2010 net income was $542,000 compared with net income of $661,000 in the first
quarter 2009.
We continue to strengthen our balance sheet by paying down debt and reducing our inventory,
stated Mr. Hable. We paid down $1.2 million on our credit line during the first quarter and
renewed our credit facilities for another year. Our inventory management initiatives were also
responsible for reducing our inventory on hand from 272 days to 229 days over the past year. We
remain focused on improving our entire supply chain to reduce our costs, enhance quality and
expedite delivery of customer orders, concluded Mr. Hable.
Conference Call Information
Synergetics USA, Inc. will host a conference call on Wednesday, December 16, 2009, at 10:30 a.m.
Eastern Time. The toll free dial-in number to listen and participate live on this call is (800)
447-0521, confirmation code 25794956. For callers outside the U.S., the number is (847) 413-3238.
Participants are encouraged to email questions to investorinfo@synergeticsusa.com. The
conference call will also be simulcast live at http://www.synergeticsusa.com. An online
replay will be available on the Companys website for approximately 30 days.
About Synergetics USA, Inc.
Through continuous improvement and development of our people, our mission is to design, manufacture
and market innovative microsurgical instruments, capital equipment, accessories and disposables of
the highest quality in order to assist and enable surgeons who perform microsurgery around the
world to provide a better quality of life for their patients.
Synergetics USA, Inc. (the Company) is a leading supplier of precision microsurgery
instrumentation. The Companys primary focus is on the microsurgical disciplines of ophthalmology
and neurosurgery. Our distribution channels include a combination of direct and independent sales
organizations and important strategic alliances with market leaders. The Companys product lines
focus upon precision engineered, microsurgical, hand-held instruments and the delivery of various
energy modalities for the performance of less invasive microsurgery including: (i) laser energy,
(ii) ultrasonic energy, (iii) radio frequency for electrosurgery and oblation and (iv) visible
light energy for illumination, and where applicable, simultaneous infusion (irrigation) of fluids
into the operative field. The Companys website address is
http://www.synergeticsusa.com.
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SURG Reports First Quarter Results
Page 3
December 15, 2009
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December 15, 2009
Forward-Looking Statements
Some statements in this release may be forward-looking statements for the purposes of the Private
Securities Litigation Reform Act of 1995. In some cases forward-looking statements can be
identified by words such as believe, expect, anticipate, plan, potential, continue or
similar expressions. Such forward-looking statements include risks and uncertainties, and there are
important factors that could cause actual results to differ materially from those expressed or
implied by such forward-looking statements. These factors, risks and uncertainties are discussed
in the Companys Annual Report on Form 10-K for the year ended July 31, 2009, as updated from time
to time in our filings with the Securities and Exchange Commission. The Company is not responsible
for updating the information contained in this press release beyond the published date, or for
changes made to this document by wire services or Internet services.
SYNERGETICS USA, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Income
Three Months Ended October 31, 2009 and October 29, 2008
(Dollars in thousands, except per share information)
Unaudited Condensed Consolidated Statements of Income
Three Months Ended October 31, 2009 and October 29, 2008
(Dollars in thousands, except per share information)
Three Months Ended | Three Months Ended | |||||||
October 31, 2009 | October 29, 2008 | |||||||
Net sales |
$ | 12,146 | $ | 12,246 | ||||
Cost of sales |
5,327 | 5,166 | ||||||
Gross profit |
6,819 | 7,080 | ||||||
Operating expenses
|
||||||||
Research and development |
600 | 652 | ||||||
Sales and marketing expenses |
3,259 | 3,244 | ||||||
General and administrative |
2,019 | 2,021 | ||||||
5,878 | 5,917 | |||||||
Operating income |
941 | 1,163 | ||||||
Other income (expense)
|
||||||||
Interest income |
| 2 | ||||||
Interest expense |
(168 | ) | (181 | ) | ||||
Miscellaneous |
28 | 3 | ||||||
(140 | ) | (176 | ) | |||||
Income before provision
for income taxes |
801 | 987 | ||||||
Provision for income taxes |
259 | 326 | ||||||
Net income |
$ | 542 | $ | 661 | ||||
Earnings per share: |
||||||||
Basic |
$ | 0.02 | $ | 0.03 | ||||
Diluted |
$ | 0.02 | $ | 0.03 | ||||
Basic weighted-average
common shares outstanding |
24,458,089 | 24,440,861 | ||||||
Diluted weighted-average
common shares outstanding |
24,496,554 | 24,578,342 | ||||||
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