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ICU Medical, Inc. Reports Second Quarter 2012 Results
GlobeNewswire
2012-07-17
Achieves Second Quarter Earnings Per Share of $0.63
Gross Margin Improves 404 Basis Points to 51%
Company is Raising the Bottom End of Its Annual Earnings Per Share Range
SAN CLEMENTE, Calif., July 16, 2012 (GLOBE NEWSWIRE) -- ICU Medical,
Inc., (Nasdaq:ICUI), a leader in the development, manufacture and sale
of innovative medical devices used in infusion therapy, oncology and
critical care applications, announced results for the second quarter
and six months ended June 30, 2012.
Second quarter of 2012 revenue was $77.3 million, compared to $77.8
million in the same period last year. Net income for the second quarter
of 2012 was $9.1 million, or $0.63 per diluted share, as compared to
net income of $9.5 million, or $0.67 per diluted share, for the second
quarter of 2011.
For the six months ended June 30, 2012, revenue increased 2.4% to
$152.8 million, compared to $149.3 million in the same period last
year. Net income for the six months ended June 30, 2012 was $16.8
million, or $1.16 per diluted share, compared to net income of $17.6
million, or $1.24 per diluted share, for the same period last year.
Scott Lamb, ICU Medical's Chief Financial Officer, said, "Our top line
performance during the second quarter was in line with our
expectations, driven primarily by solid growth in our infusion therapy
products as CLAVEs and custom sets continued to gain customer
recognition around the world. U.S. sales were up 5.2% while
international sales decreased 13.8% year over year. Our gross margins
expanded 427 basis points sequentially and 404 basis points year over
year, reflecting a more favorable product mix, a favorable foreign
exchange rate and improved manufacturing efficiencies. These gross
margin improvements in the second quarter were offset by expected
higher legal expenses and other one-time costs."
"During the second half of 2012, we will continue to leverage our
infrastructure, manufacturing efficiencies, improving marketing ability
and strong operating cash flow to expand our market footprint for
existing and new products," concluded Mr. Lamb.
Revenue by market segment for the six months ended June 30, 2012 was as
follows:
(dollars in millions)
Market Segment 2012 2011 Change
------------------- ------ ------ ------
Infusion Therapy $102.4 $96.0 6.7%
Critical Care $29.4 $32.5 -9.5%
Oncology $13.5 $12.2 10.4%
Other $7.5 $8.6 -12.5%
------ ------ ------
$152.8 $149.3 2.4%
====== ====== ======
The Company ended the second quarter with a very healthy balance sheet.
As of June 30, 2012, cash, cash equivalents and investment securities
totaled $193.5 million and working capital was $263.6 million.
Additionally, the Company generated operating cash flow of $13.1
million for the second quarter of 2012.
Fiscal Year 2012 Guidance
Based on the current business trends, management is narrowing its
previously announced revenue guidance range for the full fiscal year of
2012. The new range is $318 million to $325 million, compared to the
previous range of $318 million to $330 million. Management is also
raising the bottom end of its previously announced diluted earnings
guidance range for fiscal year 2012. The new range is $2.55 to $2.70
per share, compared to the previous range of $2.45 to $2.70 per share.
Operating cash flow for the full fiscal year is expected to be in the
range of $40 million to $50 million.
Conference Call
The Company will be conducting a conference call concerning its second
quarter results today at 4:30 p.m. EDT (1:30 p.m. PDT). The call can be
accessed at 800-936-9761, international 408-774-4587, conference ID
95427499 or by replay at 855-859-2056, international 404-537-3406,
conference ID 95427499. The conference call will be simultaneously
available by webcast, which can be accessed by going to the Company's
website at www.icumed.com, clicking on the Investors tab, clicking on
the Webcast icon and following the prompts. The webcast will also be
available by replay.
About ICU Medical, Inc.
ICU Medical, Inc. (Nasdaq:ICUI) develops, manufactures and sells
innovative medical technologies used in vascular therapy, oncology, and
critical care applications. ICU Medical's products improve patient
outcomes by helping prevent bloodstream infections, protecting
healthcare workers from exposure to infectious diseases or hazardous
drugs and monitor continuous cardiac output of critical care patients.
The Company's complete product line includes custom I.V. systems,
closed delivery systems for hazardous drugs, needleless I.V.
connectors, catheters and cardiac monitoring systems. ICU Medical is
headquartered in San Clemente, California. For more information, visit
the Company's website at www.icumed.com.
Forward Looking Statements
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such
statements contain words such as ''will,'' ''expect,'' ''believe,''
''could,'' ''would,'' ''estimate,'' ''continue,'' ''build,'' ''expand''
or the negative thereof or comparable terminology, and may include
(without limitation) information regarding the Company's expectations,
goals or intentions regarding the future, including, but not limited
to, statements regarding leveraging the Company's infrastructure,
manufacturing efficiencies, improving marketing ability and strong
operating cash flow to expand the Company's market footprint for
existing and new products and the statements under the heading ''Fiscal
Year 2012 Guidance.'' These forward-looking statements are based on
Management's current expectations, estimates, forecasts and projections
about the Company and assumptions Management believes are reasonable,
all of which are subject to risks and uncertainties that could cause
actual results and events to differ materially from those stated in the
forward-looking statements. These risks and uncertainties include, but
are not limited to, possible decreased demand for the Company's
products, increased competition from competitors, risks associated with
the Company's transition from a company that manufactured and sold
primarily critical care products to one that manufactures and sells
both critical care and medical device products, lack of continued
growth or improving efficiencies and unexpected changes in the
Company's arrangements with its largest customers. Future results are
subject to risks and uncertainties, including the risk factors, and
other risks and uncertainties, described in the Company's filings with
the Securities and Exchange Commission, which include those in the
Annual Report on Form 10-K for the year ended December 31, 2011.
Forward-looking statements contained in this press release are made
only as of the date hereof, and the Company undertakes no obligation to
update or revise the forward-looking statements, whether as a result of
new information, future events or otherwise.
ICU Medical, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Amounts in thousands, except per share data)
June 30, December
2012 31, 2011
----------- ----------
(unaudited) (1)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $121,560 $99,590
Investment securities 71,931 60,395
----------- ----------
Cash, cash equivalents and
investment securities 193,491 159,985
Accounts receivable, net of
allowance for doubtful
accounts of $1,121 at June
30, 2012 and $1,293 at
December 31, 2011 43,839 43,571
Inventories 36,535 40,423
Prepaid income taxes 9,257 5,589
Prepaid expenses and other
current assets 5,849 6,759
Deferred income taxes 4,467 4,081
----------- ----------
Total current assets 293,438 260,408
----------- ----------
PROPERTY AND EQUIPMENT, net 82,175 83,048
GOODWILL 1,478 1,478
INTANGIBLE ASSETS, net 10,749 11,419
DEFERRED INCOME TAXES 4,751 4,759
----------- ----------
$ 392,591 $ 361,112
=========== ==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable $ 12,277 $ 13,251
Accrued liabilities 17,548 16,059
----------- ----------
Total current liabilities 29,825 29,310
----------- ----------
DEFERRED INCOME TAXES 7,160 7,144
INCOME TAX LIABILITY 4,081 4,081
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Convertible preferred stock,
$1.00 par value --
Authorized--500 shares;
Issued and outstanding--none -- --
Common stock, $0.10 par value
-- Authorized--80,000 shares;
Issued 14,855 shares at June
30, 2012 and December 31,
2011, outstanding 14,247
shares June 30, 2012 and
13,871 shares at December 31,
2011 1,486 1,486
Additional paid-in capital 60,200 56,796
Treasury stock, at cost -- 608
shares at June 30, 2012 and
984 shares at December 31,
2011 (22,537) (35,348)
Retained earnings 317,627 300,877
Accumulated other
comprehensive loss (5,251) (3,234)
----------- ----------
Total stockholders' equity 351,525 320,577
----------- ----------
$ 392,591 $ 361,112
=========== ==========
______________________________
________________________
(1) December 31, 2011 balances were derived from
audited consolidated financial statements.
ICU Medical, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(Amounts in thousands, except per share data)
(unaudited)
Three months ended Six months ended June
June 30, 30,
-------------------- ----------------------
2012 2011 2012 2011
--------- --------- ---------- ----------
REVENUES:
Net sales $ 77,139 $ 77,661 $ 152,522 $ 148,999
Other 142 135 270 268
--------- --------- ---------- ----------
TOTAL REVENUE 77,281 77,796 152,792 149,267
COST OF GOODS SOLD 38,199 41,595 78,745 78,440
--------- --------- ---------- ----------
Gross profit 39,082 36,201 74,047 70,827
--------- --------- ---------- ----------
OPERATING EXPENSES:
Selling, general and
administrative 22,806 19,730 43,696 42,593
Research and
development 2,729 2,491 5,422 4,543
Legal settlement -- -- -- (2,500)
--------- --------- ---------- ----------
Total operating
expenses 25,535 22,221 49,118 44,636
--------- --------- ---------- ----------
Income from
operations 13,547 13,980 24,929 26,191
OTHER INCOME 145 431 280 834
--------- --------- ---------- ----------
Income before income
taxes 13,692 14,411 25,209 27,025
PROVISION FOR INCOME
TAXES (4,543) (4,918) (8,459) (9,459)
--------- --------- ---------- ----------
NET INCOME $ 9,149 $ 9,493 $ 16,750 $ 17,566
========= ========= ========== ==========
NET INCOME PER SHARE
Basic $ 0.65 $ 0.69 $ 1.19 $ 1.28
Diluted $ 0.63 $ 0.67 $ 1.16 $ 1.24
WEIGHTED AVERAGE NUMBER
OF SHARES
Basic 14,179 13,852 14,067 13,772
Diluted 14,620 14,257 14,484 14,166
ICU Medical, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Amounts in thousands)
(unaudited)
Six months ended June
30,
---------------------
2012 2011
---------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 16,750 $ 17,566
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 9,533 9,052
Provision for doubtful accounts (152) 437
Provision for warranty and returns 247 --
Stock compensation 3,042 1,979
Loss on disposal of property and
equipment 27 (56)
Bond premium amortization 985 399
Cash provided (used) by changes in
operating assets and liabilities
Accounts receivable (850) 3,908
Inventories 3,707 (4,025)
Prepaid expenses and other assets 821 (1,373)
Accounts payable (608) 1,286
Accrued liabilities 1,582 (599)
Deferred revenue -- (254)
Prepaid and deferred income taxes (3,612) (2,857)
---------- ---------
Net cash provided by operating
activities 31,472 25,463
---------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (8,222) (9,755)
Proceeds from sale of asset 10 --
Intangible asset additions (620) --
Proceeds from insurance -- 2,781
Purchases of investment securities (53,966) (32,236)
Proceeds from sale of investment
securities 41,062 12,900
---------- ---------
Net cash used by investing activities (21,736) (26,310)
---------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 9,333 4,572
Proceeds from employee stock purchase
plan 1,081 909
Tax benefits from exercise of stock
options 2,758 2,717
---------- ---------
Net cash provided by financing
activities 13,172 8,198
---------- ---------
Effect of exchange rate changes on cash (938) 1,167
---------- ---------
NET INCREASE IN CASH AND CASH
EQUIVALENTS 21,970 8,518
CASH AND CASH EQUIVALENTS, beginning of
period 99,590 78,850
---------- ---------
CASH AND CASH EQUIVALENTS, end of period $ 121,560 $ 87,368
========== =========
NON-CASH INVESTING ACTIVITIES
Accrued liabilities for property and
equipment $ 77 $ 262
CONTACT: ICU Medical, Inc.
Scott Lamb, Chief Financial Officer
(949) 366-2183
ICR, LLC
John F. Mills, Senior Managing Director
(310) 954-1105
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