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8-K - FORM 8-K - AMERICAN MEDICAL SYSTEMS HOLDINGS INC | c62173e8vk.htm |
Exhibit 99.1
DATE: January 10, 2011
FOR IMMEDIATE RELEASE
AMERICAN MEDICAL SYSTEMS ANNOUNCES FOURTH QUARTER 2010 REVENUE PERFORMANCE
| Fourth quarter sales of $147.0 million grow 0.7%; 4.0% growth excluding impact of currency and previously divested Uterine Health product line | ||
| 2010 sales of $542.3 million up 4.4% from 2009; 5.9% growth excluding impact of currency and Uterine Health divestiture |
MINNEAPOLIS, January 10, 2011 In anticipation of presenting at the JP Morgan Healthcare
Conference on January 11, 2011, American Medical Systems Holdings, Inc. (NASDAQ: AMMD) reported
today preliminary sales of $147.0 million for the fourth quarter of 2010, a 0.7 percent increase
over sales of $146.0 million in the comparable quarter of 2009. The strengthening of the U.S.
dollar compared to the fourth quarter of 2009 negatively affected revenue comparisons for the
quarters by $1.6 million. Adjusting for the impact of foreign currency results in fourth quarter
revenue growth of 1.7 percent over the same quarter last year. Further adjusting revenue for the
impact of the Her Option® uterine health product line, which was sold during the first quarter of
2010, results in constant currency growth of 4.0 percent. The preliminary fourth quarter revenue of
$147.0 million exceeds the Companys guidance issued on November 3, 2010, of $141 million to $146
million.
Preliminary sales for the year 2010 were reported at $542.3 million, a 4.4 percent increase over
sales of $519.3 million for the year 2009. The strengthening of the U.S. dollar for the full year
2010 compared to 2009 negatively affected revenue comparisons between years by $0.1 million.
Further adjusting revenue for the impact of the Her Option® uterine health product line divestiture
results in 2010 constant currency revenue growth of 5.9% over 2009.
Mens Health sales of $65.2 million in the fourth quarter, represented an increase of 2.7 percent
on a reported basis compared to the same quarter last year, and grew 4.1 percent on a constant
currency basis, with growth in the erectile restoration and male continence product lines roughly
equal. The BPH Therapy business declined 2.1 percent on a reported basis and 1.0 percent on a
constant currency basis, to $32.6 million for the quarter. BPH Therapy sales were led by an
enthusiastic response to the new GreenLight XPS console, offset by a decline in fiber sales due to
limited availability of the recently launched MoXy Liquid Cooled Fiber and challenging
international markets. The Womens Health business increased 6.7 percent on a reported basis and
7.4 percent on a constant currency basis to $48.8 million in the fourth quarter. The female
continence product line benefited from the recent introduction of the MiniArc® Precise
Single-Incision Sling System for the treatment of female stress urinary incontinence, and the
pelvic floor repair product line continued its strong performance driven by the success of both the
Elevate® anterior and posterior systems.
We are pleased to see notable year over year growth rate improvements across all three businesses
versus third quarter performance, noted Tony Bihl, Chief Executive Officer. We are particularly
pleased to see a significant improvement in the U.S. growth rate which achieved 7.4% in the fourth
quarter.
American Medical Systems
January 10, 2011
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January 10, 2011
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The Company reiterates its fourth quarter and full year 2010 non-GAAP adjusted earnings per
share estimates in the ranges $0.35 to $0.38, and $1.24 to $1.27, respectively, which were provided
on November 3, 2010. This guidance excludes the impact of the recently reinstated research and
development tax credit, which is estimated to have a $0.01 per share favorable impact. The full
year and fourth quarter guidance also exclude the per share impact of amortization of intangible
assets of approximately $0.025 and $0.10 for the fourth quarter and full year 2010, respectively,
and amortization of financing costs of approximately $0.025 and $0.11 for the fourth quarter and
full year 2010, respectively. Guidance for both periods excludes the impact of any unusual
non-recurring items, such as gain or loss on early debt extinguishments, sale of non-strategic
assets or IPRD charges on milestone payments related to prior acquisitions.
Mr. Bihl further commented, We look forward to sharing final financial results for the fourth
quarter, along with our guidance for 2011, during our fourth quarter earnings call on February 15,
2011.
The Company will participate in the JP Morgan Healthcare Conference on Tuesday, January 11, 2011 in
San Francisco. Tony Bihl, Chief Executive Officer, and Mark Heggestad, Chief Financial Officer,
will present to attendees of the conference at 3:00 p.m. pacific time (6:00 p.m. eastern time). A
live audio webcast of the presentation will be available to all interested parties at the Companys
Investor Relations website at www.AmericanMedicalSystems.com.
Use of Non-GAAP Financial Measures
In addition to financial measures prepared in accordance with U.S. generally accepted
accounting principles (GAAP), management provides non-GAAP adjusted earnings per share and constant
currency revenue growth rates because management believes that in order to properly understand the
Companys short-term and long-term financial trends and for purposes of comparability to other
companies, investors may wish to consider the impact of certain adjustments (such as gain on
extinguishment of debt, gain on sale of non-strategic assets, IPRD charges, amortization of
intangible assets, amortization of financing costs and related income tax adjustments, the impact
of foreign currency translation on reported revenue and the impact of tax law changes adopted on a
retroactive basis, such as the research and development tax credit). These adjustments result from
facts and circumstances (such as acquisition and business development activities and other
non-recurring items) that vary in frequency and impact on the Companys results of operations,
represent significant items, which when excluded provide a useful measure to determine the health
of the business and earnings by the business before significant non-cash charges or in the case of
foreign currency translation, are highly variable and difficult to predict. Management uses
non-GAAP adjusted earnings per share and constant currency revenue growth rates to forecast and
evaluate the operational performance of the Company as well as to compare results of current
periods to prior periods on a consistent basis.
A reconciliation of revenue growth rate percentages, the GAAP measure most directly comparable to
constant currency revenue growth rates is provided on the attached schedules.
Non-GAAP financial measures used by the Company may be calculated differently from, and therefore
may not be directly comparable to, similarly titled measures used by other companies. Investors
should consider non-GAAP measures in addition to, and not as a substitute for, or superior to,
financial performance measures prepared in accordance with GAAP.
Earnings Call Information
American Medical Systems will host a conference call on Tuesday, February 15, 2011 at 5:00 p.m.
eastern time to discuss its fourth quarter and full year results for 2010. The Company will
American Medical Systems
January 10, 2011
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January 10, 2011
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also provide guidance for 2011 on this call. Those without internet access may join the call
from within the U.S. by dialing 888-263-1724; outside the U.S., dial 970-315-0301.
A live web cast of the call will be available through the Companys corporate website at
www.AmericanMedicalSystems.com and will be available for replay three hours after the
completion of the call.
About American Medical Systems
American Medical Systems, headquartered in Minnetonka, Minnesota, is a diversified supplier of
medical devices and procedures to cure incontinence, erectile dysfunction, benign prostate
hyperplasia (BPH), pelvic floor prolapse and other pelvic disorders in men and women. These
disorders can significantly diminish ones quality of life and profoundly affect social
relationships. In recent years, the number of people seeking treatment has increased markedly as a
result of longer lives, higher-quality-of-life expectations and greater awareness of new treatment
alternatives. American Medical Systems products reduce or eliminate the incapacitating effects of
these diseases, often through minimally invasive therapies. The Companys products were used to
treat approximately 340,000 patients in 2010.
Forward-Looking Statements
This press release contains forward-looking statements relating to the market opportunities, future
products, sales and financial results of American Medical Systems. These statements and other
statements contained in this press release that are not purely historical fact are forward-looking
statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that are
based on managements beliefs, certain assumptions and current expectations. These forward-looking
statements are subject to risks and uncertainties such as successfully competing against
competitors; physician acceptance, endorsement, and use of AMS products; potential product recalls
or technological obsolescence; healthcare reform legislation in the U.S.; successfully managing
debt leverage and related credit facility financial covenants; current worldwide economic
conditions and the impact on operations of the disruption in global financial markets; factors
impacting the stock market and share price and its impact on the dilution of convertible
securities; ability of the Companys manufacturing facilities to meet customer demand; reliance on
single or sole-sourced suppliers; loss or impairment of a principal manufacturing facility;
clinical and regulatory matters; timing and success of new product introductions; patient
acceptance of the Companys products and therapies; changes in and adoption of reimbursement rates;
adequate protection of the Companys intellectual property rights; product liability claims;
currency and other economic risks inherent in selling our products internationally and other risks
and uncertainties described in the Companys Annual Report on Form 10-K for the year ended January
2, 2010, and its other SEC filings. Actual results may differ materially from anticipated results.
The forward-looking statements contained in this press release are made as of the date hereof, and
AMS undertakes no obligation to update any forward-looking statements to reflect events or
circumstances after the date on which any such statement is made or to reflect the occurrence of
unanticipated events.
More information about the Company and its products can be found at its website
www.AmericanMedicalSystems.com and in the Companys Annual Report on Form 10-K for 2009 and
its other SEC filings.
Contact: | Mark Heggestad Executive Vice President and Chief Financial Officer |
American Medical Systems
January 10, 2011
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January 10, 2011
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952-930-6495
Mark.Heggestad@AmericanMedicalSystems.com
Mark.Heggestad@AmericanMedicalSystems.com
Anthony Bihl
President and Chief Executive Officer
952-930-6334
Tony.Bihl@AmericanMedicalSystems.com
President and Chief Executive Officer
952-930-6334
Tony.Bihl@AmericanMedicalSystems.com
American Medical Systems
January 10, 2011
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January 10, 2011
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American Medical Systems Holdings, Inc.
Selected Sales Information and Constant Currency Growth Reconciliation
(Unaudited)
(In thousands)
Selected Sales Information and Constant Currency Growth Reconciliation
(Unaudited)
(In thousands)
Constant Currency Growth Reconciliation (a) | ||||||||||||||||||||
Percent Growth | ||||||||||||||||||||
Three Months Ended | Percent | Currency | at Constant | |||||||||||||||||
January 1, 2011 | January 2, 2010 | Growth | Impact | Currency | ||||||||||||||||
Sales |
||||||||||||||||||||
Mens health |
$ | 65,221 | $ | 63,504 | 2.7 | % | $ | (866 | ) | 4.1 | % | |||||||||
BPH therapy |
32,615 | 33,309 | -2.1 | % | (364 | ) | -1.0 | % | ||||||||||||
Womens health |
48,816 | 45,750 | 6.7 | % | (335 | ) | 7.4 | % | ||||||||||||
Sub-total |
146,652 | 142,563 | 2.9 | % | (1,565 | ) | 4.0 | % | ||||||||||||
Uterine health (b) |
341 | 3,450 | -90.1 | % | | -90.1 | % | |||||||||||||
Total |
$ | 146,993 | $ | 146,013 | 0.7 | % | $ | (1,565 | ) | 1.7 | % | |||||||||
Geography |
||||||||||||||||||||
United States |
$ | 106,491 | $ | 99,112 | 7.4 | % | $ | | 7.4 | % | ||||||||||
International |
40,161 | 43,451 | -7.6 | % | (1,565 | ) | -4.0 | % | ||||||||||||
Sub-total |
146,652 | 142,563 | 2.9 | % | (1,565 | ) | 4.0 | % | ||||||||||||
United
States-Uterine
health (b) |
341 | 3,450 | -90.1 | % | | -90.1 | % | |||||||||||||
Total |
$ | 146,993 | $ | 146,013 | 0.7 | % | $ | (1,565 | ) | 1.7 | % | |||||||||
Percent of total sales |
||||||||||||||||||||
Mens health |
44 | % | 43 | % | ||||||||||||||||
BPH therapy |
22 | % | 23 | % | ||||||||||||||||
Womens health |
33 | % | 31 | % | ||||||||||||||||
Sub-total |
100 | % | 98 | % | ||||||||||||||||
Uterine health (b) |
0 | % | 2 | % | ||||||||||||||||
Total |
100 | % | 100 | % | ||||||||||||||||
Geography |
||||||||||||||||||||
United States |
73 | % | 70 | % | ||||||||||||||||
International |
27 | % | 30 | % | ||||||||||||||||
Total |
100 | % | 100 | % | ||||||||||||||||
(a) | To calculate the currency impact on revenue growth rates, the Company compares each periods sales, assuming no fluctuation in foreign currency exchange rates between periods. The generally accepted accounting principle (GAAP) measure most comparable to this non-GAAP measure is growth rate percentages based on GAAP revenue. | |
(b) | The uterine health product line, Her Option® was sold in February, 2010. Revenues in the fourth quarter of 2010 include revenue earned as part of the product supply agreement, which was part of the divestiture agreement with CooperSurgical, Inc. |
American Medical Systems
January 10, 2011
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January 10, 2011
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American Medical Systems Holdings, Inc.
Selected Sales Information and Constant Currency Growth Reconciliation
(Unaudited)
(In thousands)
Selected Sales Information and Constant Currency Growth Reconciliation
(Unaudited)
(In thousands)
Constant Currency Growth Reconciliation (a) | ||||||||||||||||||||
Percent Growth | ||||||||||||||||||||
Twelve Months Ended | Percent | Currency | at Constant | |||||||||||||||||
January 1, 2011 | January 2, 2010 | Growth | Impact | Currency | ||||||||||||||||
Sales |
||||||||||||||||||||
Mens health |
$ | 246,238 | $ | 234,594 | 5.0 | % | $ | (216 | ) | 5.1 | % | |||||||||
BPH therapy |
114,592 | 114,468 | 0.1 | % | (138 | ) | 0.2 | % | ||||||||||||
Womens health |
177,247 | 159,367 | 11.2 | % | 216 | 11.1 | % | |||||||||||||
Sub-total |
538,077 | 508,429 | 5.8 | % | (138 | ) | 5.9 | % | ||||||||||||
Uterine health (b) |
4,239 | 10,841 | -60.9 | % | | -60.9 | % | |||||||||||||
Total |
$ | 542,316 | $ | 519,270 | 4.4 | % | $ | (138 | ) | 4.5 | % | |||||||||
Geography |
||||||||||||||||||||
United States |
$ | 390,680 | $ | 363,057 | 7.6 | % | $ | | 7.6 | % | ||||||||||
International |
147,397 | 145,372 | 1.4 | % | (138 | ) | 1.5 | % | ||||||||||||
Sub-total |
538,077 | 508,429 | 5.8 | % | (138 | ) | 5.9 | % | ||||||||||||
United
States-Uterine
health (b) |
4,239 | 10,841 | -60.9 | % | | -60.9 | % | |||||||||||||
Total |
$ | 542,316 | $ | 519,270 | 4.4 | % | $ | (138 | ) | 4.5 | % | |||||||||
Percent of total sales |
||||||||||||||||||||
Mens health |
45 | % | 45 | % | ||||||||||||||||
BPH therapy |
21 | % | 22 | % | ||||||||||||||||
Womens health |
33 | % | 31 | % | ||||||||||||||||
Sub-total |
99 | % | 98 | % | ||||||||||||||||
Uterine health (b) |
1 | % | 2 | % | ||||||||||||||||
Total |
100 | % | 100 | % | ||||||||||||||||
Geography |
||||||||||||||||||||
United States |
73 | % | 72 | % | ||||||||||||||||
International |
27 | % | 28 | % | ||||||||||||||||
Total |
100 | % | 100 | % | ||||||||||||||||
(a) | To calculate the currency impact on revenue growth rates, the Company compares each periods sales, assuming no fluctuation in foreign currency exchange rates between periods. The generally accepted accounting principle (GAAP) measure most comparable to this non-GAAP measure is growth rate percentages based on GAAP revenue. | |
(b) | The uterine health product line, Her Option® was sold in February, 2010. Revenues for 2010 consist of end-customer revenue earned prior to the date of sale, in addition to revenue earned as part of the product supply agreement, which was part of the divestiture agreement with CooperSurgical, Inc. |