Integra LifeSciences Reports Record Second Quarter Net Income on 35% Growth in Product Sales
PLAINSBORO, N.J.--(BUSINESS WIRE)--Aug. 2, 2001-- Earnings Before Interest, Taxes, Depreciation and Amortization Totaled
Led by strong growth in product sales, Integra LifeSciences Holdings Corporation (Nasdaq:IART) today reported record revenues and net income for the second quarter of 2001.
Earnings for the quarter were $0.10 per share, as compared to an adjusted net loss of $0.06 per share in the second quarter of 2000. Net income totaled $2.8 million, with total revenues increasing $5.8 million, or 34%, to $22.9 million. This compares to an adjusted net loss of $0.6 million in the second quarter of 2000 on total revenues of $17.1 million.
For comparability purposes, the prior year results were adjusted to exclude a $1.1 million gain on the sale of a product line and $0.3 million of fair value inventory purchase accounting adjustments related to an acquisition.
Revenue growth was led by a $5.6 million increase in product sales to $21.4 million, a 35% increase over the second quarter of 2000. Included in this increase was $0.4 million in sales of product lines acquired early in this quarter. Sales in the Integra NeuroSciences division increased $4.6 million to $15.7 million, and included the $0.4 million in sales of acquired product lines.
Contributing to the strong growth in the Integra NeuroSciences division were sales of the DuraGen® Dural Graft Matrix, with domestic reorder rates continuing to exceed 80%, our line of intracranial monitoring products for the neuro intensive care unit, and the Selector® Integra Ultrasonic Aspirator for the ablation of cranial tumors.
Sales of Integra LifeSciences division products increased $1.0 million to $5.7 million primarily due to growth in the Company's private label products.
"The strong results for this quarter can be attributed to the recent expansion in the Integra NeuroSciences' sales force, particularly in the United States, and the diverse line of products acquired or developed by the Company over the last two years," commented Stuart M. Essig, Integra's President and Chief Executive Officer. "With the acquisitions of GMSmbH in Germany and Satelec Medical in France in April, we are continuing to build our sales and marketing infrastructure in Europe, which is expected to benefit our top line revenue growth."
Consolidated gross margins on product sales increased to 61% in the second quarter of 2001 from an adjusted 57% in the second quarter of 2000 as a result of an improved sales mix of higher gross margin products. Consolidated operating expenses (excluding cost of product sales) increased $0.7 million from the second quarter of 2000 to $11.2 million in the second quarter of 2001.
This increase was the result of higher sales and marketing expenses attributed to the expansion of the Integra NeuroSciences direct sales force, partially offset by lower general and administrative and research and development expenses.
On a divisional operating basis, the Company reported the following results for the second quarter of 2001:
In the Integra NeuroSciences division:
Sales of neuro intensive care unit products increased $1.3 million to $6.8 million, including $0.1 million in sales of acquired products.
Neuro operating room product sales increased $3.3 million to $8.9 million, including $0.3 million in sales of acquired products.
Gross margin on product sales was 63%, as compared to an adjusted 59% in the second quarter of 2000.
Total other operating expenses increased $1.6 million to $6.5 million, with the division reporting a $3.7 million operating profit. The increase in operating expenses was entirely related to higher sales and marketing spending.
In the Integra LifeSciences division:
Sales of private label products increased $0.6 million to $3.3 million.
Sales of distributed products increased $0.4 million to $2.4 million.
Gross margin on product sales was 55%, as compared to an adjusted 51% in the second quarter of 2000.
Total other operating expenses decreased $0.4 million to $2.1 million for the quarter, with the division reporting a $2.3 million operating profit.
Divisional operating results exclude corporate general and administrative expenses and amortization of intangible assets and goodwill. For the quarter, corporate general and administrative expenses decreased $0.5 million to $1.8 million, while intangible asset amortization increased to $0.7 million as a result of the GMS and Satelec Medical acquisitions.
The Company reported Earnings Before Interest, Taxes, Depreciation and Amortization of $4.7 million, as compared to an adjusted $1.1 million in the second quarter of 2000.
The Company has scheduled a conference call for 9:00 am EST today, August 2, 2001, to discuss the financial results for the second quarter of 2001. However, in light of our pending registration statement, we will not update or otherwise comment on our expectations for future financial results until our third quarter conference call in November.
Access to the live conference call is available by dialing (877) 691-0877 in the United States or (973) 628-9554 for international listeners. Access to the call will also be available through a live webcast via a link provided on the home page of Integra's website at www.integra-LS.com.
Integra LifeSciences Holdings Corporation develops, manufactures and markets medical devices, implants and biomaterials primarily used in the treatment of cranial and spinal disorders, soft tissue repair and orthopedics. Integra is a leader in applying the principles of biotechnology to medical devices that improve patients' quality of life.
The Company has its corporate headquarters in Plainsboro, New Jersey, with manufacturing and research facilities located throughout the world. The Company has approximately 575 permanent employees.
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from predicted or expected results. Forward-looking statements include, but are not limited to, statements concerning future growth in revenues. In addition, the economic, competitive, governmental, technological and other factors identified under the heading "Risk Factors" included in the Business section of Integra's Annual Report on Form 10-K/A for the year ended December 31, 2000 and in the Company's Registration Statement on Form S-3, and information contained in subsequent filings with the Securities and Exchange Commission could affect actual results.
INTEGRA LIFESCIENCES HOLDINGS CORPORATION CONSOLIDATED FINANCIAL RESULTS (In thousands, except per share data) (UNAUDITED)
Statement of Operations Data: Three Month Period Six Month Period Ended June 30 Ended June 30 2001 2000 2001 2000
Product sales $21,385 $15,827 $41,669 $29,159 Other revenue 1,535 1,259 2,935 2,458 Total revenue 22,920 17,086 44,604 31,617
Cost of product sales 8,310 7,212 16,904 13,899 Research and development 1,837 2,004 3,910 3,894 Selling and marketing 5,269 3,904 10,020 6,853 General and administrative 3,319 3,884 6,523 7,631 Amortization 729 670 1,409 1,150 Total costs and expenses 19,464 17,674 38,766 33,427
Operating income (loss) 3,456 (588) 5,838 (1,810)
Gain on disposition of product line -- 1,031 -- 1,146 Other expense, net (265) (170) (405) (36) Income (loss) before income taxes 3,191 273 5,433 (700) Provision for income taxes 429 161 675 223
Income (loss) before accounting change 2,762 112 4,758 (923)
Cumulative effect of accounting change -- -- -- (470)
Net income (loss) $ 2,762 $ 112 $ 4,758 $(1,393)
Earnings (loss) per share Basic $ 0.13 $ (0.02) $ 0.20 $ (0.36) Diluted $ 0.10 $ (0.02) $ 0.18 $ (0.36)
Weighted average Common shares outstanding: Basic 20,245 17,341 19,931 17,282 Diluted 25,049 17,341 22,211 17,282
Balance Sheet Data: 30-JUN 31-DEC 2001 2000
Cash, cash equivalents & investments $11,655 $15,138 Working capital 28,299 25,177 Total assets 94,193 86,514 Total debt 9,703 13,630 Total stockholders' equity 62,522 53,781
Source: Integra LifeSciences Holdings Corporation
|CONTACT:||Integra LifeSciences Holdings Corporation|
|John B. Henneman, III, 609/936-2481|
|John Bostjancic, 609/936-2239|