ICU Medical, Inc. Reports Strong Third Quarter 2010 Results
ICU Medical, Inc. Reports Strong Third Quarter 2010 Results
Sales Increased 40.3% to $75.7 Million
Diluted EPS Increased 54.8% to $0.65
Company Raises 2010 Revenue and Earnings Guidance
SAN CLEMENTE, Calif., Oct. 18, 2010 (GLOBE NEWSWIRE) -- ICU Medical, Inc., (Nasdaq:ICUI), a leading low cost manufacturer of safe medical connectors, custom medical products and critical care devices, announced results for the third quarter and nine months ended September 30, 2010.
Third quarter of 2010 revenue increased 40.3% to $75.7 million, compared to $54.0 million in the same period last year. Net income for the third quarter of 2010 was $9.0 million, or $0.65 per diluted share, as compared to net income of $6.3 million, or $0.42 per diluted share, for the third quarter of 2009.
For the nine months ended September 30, 2010, revenue increased 29.2% to $209.0 million, compared to $161.7 million in the same period last year. Net income for the nine months ended September 30, 2010, was $20.9 million, or $1.51 per diluted share, compared to net income of $19.1 million, or $1.27 per diluted share, for the same period last year.
Scott Lamb, ICU Medical's Chief Financial Officer, said, "We are pleased with our financial performance during the third quarter which included double-digit improvements in revenue and profitability. Our top-line growth was fueled by positive contributions from all of our product lines, led by CLAVEs, custom products and critical care. Domestic distributor and direct sales increased 38% year over year, while international sales were up 29%."
"During the quarter, we successfully completed the transition of the critical care operations that we purchased last year from Hospira. We also launched operations at our new plant in Slovakia and expect to start shipments of products from this new facility during the fourth quarter. We believe that this new facility will greatly improve our time to market for custom products in Europe. Additionally, we continued to make investments in research and development, quality controls and manufacturing efficiencies, which are essential in maintaining our proven track record of customer satisfaction," concluded Mr. Lamb.
The Company ended the third quarter with a strong balance sheet. As of September 30, 2010, cash, cash equivalents and investment securities totaled $81.9 million and working capital was $168.7 million. Additionally, the Company generated operating cash flow of $18.7 million for the first nine months of 2010.
Fiscal Year 2010 Guidance
Based on the current business trends, management has raised the Company's revenue and earnings per share guidance range for the full fiscal year of 2010. Revenue is now expected to be in the range of $277 million to $282 million, up from the previous guidance of $270 million to $275 million. Diluted earnings are now expected to be in the range of $2.00 to $2.07 per share, compared to the previous guidance of $1.85 to $1.92 per share. Operating cash flow is expected to be in the range of $35 million to $40 million.
Conference Call
The Company will be conducting a conference call concerning its third quarter results today at 4:30 p.m. EDT (1:30 p.m. PDT). The call can be accessed at 866-783-2143, passcode 41883861 or by replay at 888-286-8010, passcode 18772156. 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. Certain information provided as part of that call will be provided on the Company's website at www.icumed.com within 48 hours of the call.
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, protect healthcare workers and patients from exposure to infectious diseases or hazardous drugs and monitor the hemodynamic status 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 web site 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 the timing of the commencement of shipments from the new manufacturing plant in Slovakia and the Company's expectations regarding improved time to market for custom products in Europe; the Company's continued investment in research and development, quality controls and manufacturing efficiencies; and the Company's positioning for continued long-term growth and profitability and delivering value to its shareholders. In addition, forward-looking statements also include the statements under the heading "Fiscal Year 2010 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, decreased demand for the Company's products, increased competition from competitors, lack of continued growth or improving efficiencies, increased costs for shipping products and unexpected delays or costs associated with the operation of the manufacturing plant in Slovakia. 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, 2009 and the Quarterly Report on Form 10-Q for the quarter ended June 30, 2010. 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)
September December
30, 2010 31, 2009
----------- ---------
(unaudited) (1)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 65,671 $ 51,248
Investment securities 16,225 56,887
----------- ---------
Cash, cash equivalents and
investment securities 81,896 108,135
Accounts receivable, net of
allowance for doubtful
accounts of $522 at
September 30, 2010 and $324
at December 31, 2009 55,796 47,777
Inventories 43,625 41,327
Prepaid income taxes 2,994 1,994
Prepaid expenses and other
current assets 6,748 5,462
Deferred income taxes 4,307 3,243
----------- ---------
Total current assets 195,366 207,938
----------- ---------
PROPERTY AND EQUIPMENT, net 83,777 77,449
PROPERTY HELD FOR SALE -- 940
GOODWILL 1,478 1,478
INTANGIBLE ASSETS, net 15,256 16,782
DEFERRED INCOME TAXES 3,690 3,710
INCOME TAXES RECEIVABLE 856 856
----------- ---------
$ 300,423 $ 309,153
=========== =========
LIABILITIES AND STOCKHOLDERS'
EQUITY
CURRENT LIABILITIES:
Accounts payable $ 12,056 $ 18,423
Accrued liabilities 14,191 12,884
Deferred revenue 376 2,389
----------- ---------
Total current liabilities 26,623 33,696
----------- ---------
DEFERRED INCOME TAXES 7,157 5,698
INCOME TAX LIABILITY 4,366 4,754
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 September 30,
2010 and 14,811 shares at
December 31, 2009,
outstanding 13,547 shares
at September 30, 2010 and
14,239 shares at December
31, 2009 1,485 1,481
Additional paid-in capital 57,112 54,357
Treasury stock, at
cost--1,308 and 572 shares
at September 30, 2010 and
December 31, 2009 (45,533) (19,881)
Retained earnings 248,804 227,861
Accumulated other
comprehensive income 409 1,187
----------- ---------
Total stockholders' equity 262,277 265,005
----------- ---------
$ 300,423 $ 309,153
=========== =========
(1) December 31, 2009
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 Nine months ended
September 30, September 30,
------------------- --------------------
2010 2009 2010 2009
--------- -------- --------- ---------
REVENUES:
Net sales $ 75,589 $ 53,830 $ 208,511 $ 161,307
Other 148 135 451 392
--------- -------- --------- ---------
TOTAL REVENUE 75,737 53,965 208,962 161,699
COST OF GOODS SOLD 41,705 28,916 115,876 84,295
--------- -------- --------- ---------
Gross profit 34,032 25,049 93,086 77,404
--------- -------- --------- ---------
OPERATING EXPENSES:
Selling, general and
administrative 18,341 16,751 57,368 48,366
Research and development 1,067 661 2,937 2,016
--------- -------- --------- ---------
Total operating
expenses 19,408 17,412 60,305 50,382
--------- -------- --------- ---------
Income from operations 14,624 7,637 32,781 27,022
OTHER INCOME (EXPENSE) (215) 419 40 1,042
--------- -------- --------- ---------
Income before income
taxes 14,409 8,056 32,821 28,064
PROVISION FOR INCOME
TAXES (5,434) (1,732) (11,878) (8,937)
--------- -------- --------- ---------
NET INCOME $ 8,975 $ 6,324 $ 20,943 $ 19,127
========= ======== ========= =========
NET INCOME PER SHARE
Basic $ 0.67 $ 0.43 $ 1.54 $ 1.29
Diluted $ 0.65 $ 0.42 $ 1.51 $ 1.27
WEIGHTED AVERAGE NUMBER
OF SHARES
Basic 13,489 14,796 13,605 14,771
Diluted 13,752 15,146 13,838 15,033
ICU Medical, Inc. and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Amounts in thousands)
(unaudited)
Nine months ended
September 30,
-------------------
2010 2009
--------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 20,943 $ 19,127
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 12,796 11,280
Provision for doubtful accounts 154 (25)
Stock compensation 2,568 1,963
Bond premium amortization 1,145 1,703
Loss on disposal/impairment of property
and equipment 298 --
Cash provided (used) by changes in
operating assets and liabilities, net
of assets acquired
Accounts receivable (7,763) 6,502
Inventories (2,670) (1,754)
Prepaid expenses and other assets (1,874) (2,425)
Accounts payable (6,365) 1,655
Accrued liabilities 1,381 (3,240)
Deferred revenue (2,013) 1,923
Prepaid and deferred income taxes 69 3,517
--------- --------
Net cash provided by operating
activities 18,669 40,226
--------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (16,978) (10,164)
Assets purchased -- (30,533)
Proceeds from sale of asset 893 --
Business acquisition, net of cash
acquired -- (5,662)
Change in restricted cash -- 5,497
Purchases of investment securities (20,853) (89,940)
Proceeds from sale of investment
securities 60,370 85,554
--------- --------
Net cash provided (used) by investing
activities 23,432 (45,248)
--------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from exercise of stock options 903 1,352
Proceeds from employee stock purchase
plan 1,576 1,271
Tax benefits from exercise of stock
options 708 88
Purchase of treasury stock (28,648) (560)
--------- --------
Net cash provided (used) by financing
activities (25,461) 2,151
--------- --------
Effect of exchange rate changes on cash (2,217) 434
--------- --------
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 14,423 (2,437)
CASH AND CASH EQUIVALENTS, beginning of
period 51,248 55,696
--------- --------
CASH AND CASH EQUIVALENTS, end of period $ 65,671 $ 53,259
========= ========
NON-CASH INVESTING ACTIVITIES
Accrued liabilities for property and
equipment $ 11 $ --
This news release was distributed by GlobeNewswire, www.globenewswire.com
SOURCE: ICU Medical, Inc.
CONTACT: ICU Medical, Inc. Scott Lamb, Chief Financial Officer (949) 366-2183 ICR, LLC. John F. Mills, Senior Managing Director (310) 954-1100