WESTFORD, Mass., Feb. 15, 2011 /PRNewswire/ -- Cynosure, Inc.
(Nasdaq: CYNO) today announced financial results for the three
months and year ended December 31,
2010.
Revenues for the fourth quarter of 2010 increased 16 percent to
$22.3 million from $19.3 million in the same period of 2009.
Net loss for the fourth quarter of 2010 was $0.8 million, or $0.06 per basic and diluted share, compared with
a net loss of $14.5 million, or
$1.14 per basic and diluted share, or
the comparable period of 2009. Financial results for the
fourth quarter of 2009 included a non-cash tax charge of
$10.4 million to establish a
valuation allowance against the company's U.S. deferred tax assets,
and a $2.1 million non-cash charge
related to an inventory write-down of an earlier-generation
product.
The company reduced its loss from operations in the fourth
quarter of 2010 to $0.6 million,
which included stock-based compensation of approximately
$0.6 million. This compares
with a loss from operations in the fourth quarter of 2009 of
$5.7 million, which included
stock-based compensation of $1.1
million.
"Higher product demand from North
America and overseas drove our revenue growth in the fourth
quarter," said Cynosure President and Chief Executive Officer
Michael Davin. "In North
America, laser product sales were up 17 percent from the same
period in 2009. Although financing remains difficult for many
aesthetic practitioners, the relationships we have established with
certain financial institutions and third-party financing sources
are gradually beginning to improve access to credit for our
customers. International laser product sales rose 18 percent
from the fourth quarter of 2009, paced by solid gains in our Asian
direct distribution network."
Gross profit for the fourth quarter of 2010 was 55.9 percent of
total revenues, compared with 43.9 percent for the same period of
2009, which included the inventory write-down. The improvement in
gross margin in the 2010 period reflected the effects of the
inventory write-down as well as a higher percentage of sales from
direct distribution channels, which carry higher margins than
products sold through third-party distributors.
Total operating expenses for the fourth quarter of 2010
decreased $1.1 million, or 8 percent,
to $13.1 million from $14.2 million for the same period of 2009.
For full-year 2010, total operating expenses decreased
$8.9 million, or 15 percent, to
$51.4 million from $60.3 million for 2009.
"We generated positive cash flow from operations for the seventh
consecutive quarter in Q4, reflecting the success of our
cost-reduction initiatives," Davin said. "With our $8.9 million decrease in operating expenses for
the year, we exceeded our goal of lowering annualized operating
expenses in the range of $5 million to $7
million from 2009, and also exceeded our objective to be
cash-flow breakeven for 2010. Our cash, marketable securities and
investments totaled $96.8 million at
year-end, an increase of approximately $4.9
million from the end of 2009. We also purchased $1.4 million of stock under our previously
announced stock buyback plan in 2010."
FY 2010 Financial Results: Year-over-Year Revenue
Growth of 12 Percent
Revenues for the 12 months ended December
31, 2010 increased 12 percent to $81.8 million from $72.8
million for the full year of 2009. Gross profit for
2010 was 56.7 percent of total revenues, compared with 54.9 percent
for 2009, which included the inventory write-down. Net loss
for 2010 was $5.5 million, or
$0.44 per basic and diluted share,
compared with a net loss for full-year 2009 of $22.8 million, or $1.79 per basic and diluted share. Financial
results for 2009 included the non-cash tax charge of $10.4 million to establish a valuation allowance
against the company's U.S. deferred tax assets, and the
$2.1 million non-cash charge related
to an inventory write-down of an earlier-generation product.
Recent Highlights
- World's First Minimally Invasive Laser for Long-term
Cellulite Reduction: Cynosure recently introduced the
Cellulaze™ Cellulite Laser Workstation, the world's first minimally
invasive surgical device specifically designed for the long-term
reduction of cellulite. Cellulaze uses laser energy to
restore the normal structure of the skin and underlying connective
tissue, increasing skin elasticity and thickness. The
product, which recently received CE Mark certification, was
unveiled this month at the American Academy of Dermatology's 69th
Annual Meeting in New Orleans. It
will be available for sale to physicians in the European Union in
the second quarter of 2011.
- Non-Invasive SmoothShapes XV for Temporary Reduction of
Cellulite: Cynosure acquired substantially all of the assets of
Eleme Medical, including the company's non-invasive SmoothShapes®
XV system for the temporary reduction in the appearance of
cellulite. The SmoothShapes XV system treats cellulite through a
proprietary process known as Photomology®, which combines laser and
light energy with mechanical manipulation (vacuum and massage) to
produce tighter, smoother-looking skin. The system is FDA cleared
for marketing in the United States
and CE marked for sale in the European Union.
"Product innovation is the engine that continues to drive growth
at Cynosure, and we believe that our new cellulite workstations
will play an integral role in the company's long-term success,"
Davin said. "In Cellulaze and SmoothShapes XV, we are building a
broad technology platform designed to serve practitioners and their
patients who are seeking a solution for either long-lasting or
temporary cellulite reduction. We are excited about the
future potential of these products to treat what we believe is a
significantly underserved aesthetic indication that affects 85
percent of women over the age of 20."
Outlook
"Our strong balance sheet and aggressive cost-reduction
initiatives put us on solid financial footing for the coming year,
as we focus on building momentum across our direct and third-party
distributor sales," Davin said. "Near-term, we plan to begin
rolling out Cellulaze in key European territories, complete the
clinical steps necessary for regulatory review of our Cellulaze
510(k) application in the United
States and launch our SmoothShapes XV workstation in
domestic and international markets. We are optimistic about
the prospects for our business in 2011."
Fourth-Quarter and Year-End Financial Results Conference
Call
In conjunction with its fourth-quarter results, Cynosure will
host a conference call for investors and analysts at 9:00 a.m. ET today. On the call,
Michael Davin and Timothy Baker, the company's Executive Vice
President and Chief Financial Officer, will discuss the company's
financial results and provide a business overview. Those who wish
to listen to the conference call webcast should visit the "Investor
Relations" section of the company's website at www.cynosure.com.
The live call can also be accessed by dialing (877) 407-5790
or (201) 689-8328. If you are unable to listen to the live
call, the webcast will be archived on the company's website.
About Cynosure, Inc.
Cynosure, Inc. develops and markets aesthetic treatment systems
that are used by physicians and other practitioners to perform
non-invasive and minimally invasive procedures to remove hair,
treat vascular and pigmented lesions, rejuvenate the skin, liquefy
and remove unwanted fat through laser lipolysis and reduce the
appearance of cellulite. Cynosure's products include a broad
range of laser and other light-based energy sources, including
Alexandrite, pulse dye, Nd:YAG and diode lasers, as well as intense
pulsed light. Cynosure was founded in 1991. For corporate or
product information, contact Cynosure at 800-886-2966, or visit
www.cynosure.com.
Forward-Looking Statements
Any statements in this press release about future expectations,
plans and prospects for Cynosure, Inc., including statements about
the company's anticipated financial results, as well as other
statements containing the words "believes," "anticipates," "plans,"
"expects," "will" and similar expressions, constitute
forward-looking statements within the meaning of The Private
Securities Litigation Reform Act of 1995. Actual results may
differ materially from those indicated by such forward-looking
statements as a result of various important factors, including the
global economy and lending environment and their effects on the
aesthetic laser industry, Cynosure's history of operating losses,
its reliance on sole source suppliers, the inability to accurately
predict the timing or outcome of regulatory decisions, changes in
consumer preferences, competition in the aesthetic laser industry,
economic, market, technological and other factors discussed in
Cynosure's most recent Annual Report on Form 10-K and Quarterly
Report on Form 10-Q, which are filed with the Securities and
Exchange Commission. In addition, the forward-looking
statements included in this press release represent Cynosure's
views as of the date of this press release. Cynosure
anticipates that subsequent events and developments will cause its
views to change. However, while Cynosure may elect to update
these forward-looking statements at some point in the future, it
specifically disclaims any obligation to do so. These
forward-looking statements should not be relied upon as
representing Cynosure's views as of any date subsequent to the date
of this press release.
Consolidated Statements of
Income (Unaudited)
|
|
(In thousands, except per share
data)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended Dec. 31,
|
|
Year Ended
Dec. 31,
|
|
|
|
2010
|
2009
|
|
2010
|
2009
|
|
|
|
|
|
|
|
|
|
Revenues
|
$ 22,342
|
$ 19,259
|
|
$ 81,775
|
$ 72,825
|
|
Cost of revenues
|
9,859
|
10,811
|
|
35,388
|
32,808
|
|
Gross profit
|
12,483
|
8,448
|
|
46,387
|
40,017
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
|
|
|
Selling and marketing
|
8,702
|
9,402
|
|
32,818
|
39,098
|
|
|
Research and development
|
1,846
|
1,678
|
|
7,300
|
6,679
|
|
|
General and
administrative
|
2,561
|
3,116
|
|
11,312
|
14,556
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
13,109
|
14,196
|
|
51,430
|
60,333
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
(626)
|
(5,748)
|
|
(5,043)
|
(20,316)
|
|
|
|
|
|
|
|
|
|
|
Interest income, net
|
24
|
69
|
|
163
|
523
|
|
|
Other (expense) income,
net
|
(28)
|
(12)
|
|
(224)
|
694
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
(630)
|
(5,691)
|
|
(5,104)
|
(19,099)
|
|
|
|
|
|
|
|
|
|
|
Income tax provision
|
168
|
8,807
|
|
442
|
3,659
|
|
|
|
|
|
|
|
|
|
Net loss
|
$ (798)
|
$ (14,498)
|
|
$ (5,546)
|
$ (22,758)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net loss per
share
|
$ (0.06)
|
$
(1.14)
|
|
$ (0.44)
|
$
(1.79)
|
|
Diluted weighted average shares
outstanding
|
12,592
|
12,712
|
|
12,666
|
12,709
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net loss per
share
|
$ (0.06)
|
$
(1.14)
|
|
$ (0.44)
|
$
(1.79)
|
|
Basic weighted average shares
outstanding
|
12,592
|
12,712
|
|
12,666
|
12,709
|
|
|
|
|
|
|
|
|
Condensed Consolidated Balance
Sheet
|
|
(In thousands)
|
|
|
|
Dec.
31,
|
|
Dec.
31,
|
|
|
|
2010
|
|
2009
|
|
|
|
(unaudited)
|
|
Assets:
|
|
|
|
|
|
Cash, cash equivalents and
short-term marketable securities
|
$
86,836
|
|
$
68,505
|
|
|
Short-term investments and
related financial instruments
|
-
|
|
18,454
|
|
|
Accounts receivable,
net
|
10,621
|
|
11,741
|
|
|
Inventories
|
18,684
|
|
21,815
|
|
|
Prepaid expenses and other
current assets
|
3,902
|
|
6,441
|
|
|
Deferred tax asset, current
portion
|
489
|
|
160
|
|
Total current assets
|
120,532
|
|
127,116
|
|
|
Property and equipment,
net
|
8,892
|
|
10,567
|
|
|
Long-term marketable
securities
|
9,990
|
|
5,008
|
|
|
Other noncurrent
assets
|
2,398
|
|
2,510
|
|
Total assets
|
$
141,812
|
|
$
145,201
|
|
|
|
|
|
|
|
Liabilities and stockholders’
equity:
|
|
|
|
|
|
Accounts payable and accrued
expenses
|
$
15,267
|
|
$
14,357
|
|
|
Amounts due to related
parties
|
1,785
|
|
1,350
|
|
|
Deferred revenue
|
3,660
|
|
4,237
|
|
|
Capital lease
obligations
|
133
|
|
264
|
|
Total current
liabilities
|
20,845
|
|
20,208
|
|
|
|
|
|
|
|
Capital lease obligations, net
of current portion
|
40
|
|
171
|
|
Deferred revenue, net of current
portion
|
348
|
|
620
|
|
Other long-term
liabilities
|
279
|
|
372
|
|
Total stockholders’
equity
|
120,300
|
|
123,830
|
|
Total liabilities and
stockholders’ equity
|
$
141,812
|
|
$
145,201
|
|
|
|
|
|
|
Contact:
|
|
Scott Solomon
|
|
Vice President
|
|
Sharon Merrill Associates,
Inc.
|
|
Phone: (617) 542-5300
|
|
CYNO@investorrelations.com
|
|
|
SOURCE Cynosure, Inc.