WESTFORD, Mass., May 3, 2011 /PRNewswire/ -- Cynosure, Inc.
(NASDAQ: CYNO) today announced financial results for the three
months ended March 31, 2011.
Revenues for the first quarter of 2011 increased 16 percent to
$21.9 million from $18.9 million in the same period of 2010.
Net loss for the first quarter of 2011 was $1.9 million, or $0.15 per basic and diluted share, compared with
a net loss of $2.8 million, or
$0.22 per basic and diluted share,
for the comparable period of 2010.
Gross profit for the three months ended March 31, 2011 was 55.2 percent of total
revenues, compared with 57.2 percent for the same period of 2010.
Results for the first quarter of 2011 included a one-time
purchase accounting adjustment for the company's acquisition of the
assets of Eleme Medical earlier this year. The purchase
accounting adjustment, which related to the write-up of Eleme
Medical's finished goods inventory sold during the quarter, had the
effect of reducing Cynosure's 2011 first quarter gross profit by
approximately 100 basis points.
Total operating expenses increased 5 percent to $13.9 million, or 64 percent of revenues, in the
first quarter of 2011 from $13.3
million, or 71 percent of revenues, for the same period of
2010. Higher operating expenses in the 2011 period reflected higher
research and development and sales and marketing costs associated
with the company's new cellulite reduction platform, comprised of
the new Cellulaze™ Cellulite Laser Workstation and SmoothShapes®
XV.
"Laser product revenue increased 17 percent in the first
quarter, as our North American direct sales force, European
subsidiaries and international distributors all generated strong
year-over-year results," said Cynosure President and Chief
Executive Officer Michael Davin.
"While we were pleased with our revenue performance, our
gross profit was below our expectation for the quarter, primarily
related to the purchase accounting adjustment."
"We continue to maintain a strong balance sheet, concluding the
2011 first quarter with cash, marketable securities and investments
of $95.6 million, even with our
$2.5 million cash acquisition of the
Eleme Medical assets," Davin continued. "In addition, we generated
positive cash flow from operations of $1.8
million, underscoring our focus on effectively managing
operating expenses as we invested in product development
initiatives related to our new cellulite reduction platform."
During the first quarter, Cynosure launched the non-invasive
SmoothShapes XV system, which the company acquired as part of the
asset purchase of Eleme Medical. SmoothShapes XV was
introduced through Cynosure's direct sales force in North America, and its international
distribution channel, including its direct subsidiaries in the
European Union. In addition, Cynosure launched the Cellulaze™
Cellulite Laser Workstation in the European Community and
established three Cellulaze clinical sites led by physician
luminaries in the EU to train plastic surgeons and dermatologists
on the use of the minimally invasive procedure. In
the United States, the company's
510(k) application for marketing clearance of Cellulaze is
undergoing review by the U.S. Food and Drug Administration.
Recent Highlights
- Two New Cellulaze Studies: Two U.S. clinical
studies using the Cellulaze workstation were presented at the
recent Annual Scientific Conference of the American Society for
Laser Medicine and Surgery. A preliminary study of 10
patients concluded that a single treatment with Cellulaze improves
the appearance of cellulite and that improvement persists for at
least one year with minimal adverse effects. Another study of 15
subjects concluded that a sidelight three-dimensional optical fiber
and 1440 nm Nd:YAG laser, which is used in Cellulaze, appeared to
have long-lasting benefits in the treatment of cellulite.
Significant improvement in cellulite was demonstrated in 68 percent
of cases by photographic evaluation and 65 percent with Vectra 3D
surface imaging.
- International Marketing Clearances: During the first
quarter, the company announced the receipt of two key international
marketing clearances: Health Canada issued a Medical Device License
authorizing the SmoothShapes XV system to be marketed in
Canada for the temporary reduction
in the appearance of cellulite. In addition, the Korea Food and
Drug Administration granted marketing approval for the Smartlipo
Triplex™ system, the company's minimally invasive technology for
fat removal and skin tightening.
Business Outlook
Davin concluded, "Our financial position remains strong, and we
are encouraged to see continuing top-line momentum. We are
optimistic about the prospects for our business as we begin our
European launch of Cellulaze and introduce SmoothShapes XV across
our direct distribution channel. As our markets continue to
slowly recover from the lingering effects of the recession, we
believe Cynosure is well-positioned with a strong brand and broad
suite of innovative products that deliver excellent outcomes for
aesthetic patients."
First-Quarter Financial Results Conference
Call
In conjunction with its first-quarter 2011 financial 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, which is 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.
Contact:
Scott Solomon
Vice President
Sharon Merrill Associates, Inc.
Phone: (617) 542-5300
CYNO@investorrelations.com
Consolidated Statements of
Income (Unaudited)
|
|
(In thousands, except per share
data)
|
|
|
|
|
|
|
|
|
Three Months
Ended Mar. 31,
|
|
|
|
2011
|
2010
|
|
|
|
|
|
|
Revenues
|
$
21,884
|
$
18,893
|
|
Cost of revenues
|
9,803
|
8,093
|
|
Gross profit
|
12,081
|
10,800
|
|
|
|
|
|
|
Operating
expenses
|
|
|
|
|
Selling and marketing
|
8,756
|
8,402
|
|
|
Research and development
|
2,240
|
1,707
|
|
|
General and
administrative
|
2,951
|
3,233
|
|
|
|
|
|
|
Total operating
expenses
|
13,947
|
13,342
|
|
|
|
|
|
|
Loss from
operations
|
(1,866)
|
(2,542)
|
|
|
|
|
|
|
|
Interest income, net
|
54
|
53
|
|
|
Other income (expense),
net
|
214
|
(151)
|
|
|
|
|
|
|
Loss before income
taxes
|
(1,598)
|
(2,640)
|
|
|
|
|
|
|
|
Income tax provision
|
296
|
172
|
|
|
|
|
|
|
Net loss
|
$
(1,894)
|
$
(2,812)
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net loss per
share
|
$
(0.15)
|
$
(0.22)
|
|
Diluted weighted average shares
outstanding
|
12,577
|
12,711
|
|
|
|
|
|
|
|
|
|
|
|
Basic net loss per
share
|
$
(0.15)
|
$
(0.22)
|
|
Basic weighted average shares
outstanding
|
12,577
|
12,711
|
|
|
|
|
|
Condensed Consolidated Balance
Sheet
|
|
(In thousands)
|
|
|
|
Mar.
31,
|
|
Dec.
31,
|
|
|
|
2011
|
|
2010
|
|
|
|
(unaudited)
|
|
|
Assets:
|
|
|
|
|
|
Cash, cash equivalents and
short-term marketable securities
|
$ 81,841
|
|
$ 86,836
|
|
|
Accounts receivable,
net
|
10,397
|
|
10,621
|
|
|
Inventories
|
21,271
|
|
18,684
|
|
|
Prepaid expenses and other
current assets
|
3,684
|
|
3,902
|
|
|
Deferred tax asset, current
portion
|
510
|
|
489
|
|
Total current assets
|
117,703
|
|
120,532
|
|
|
Property and equipment,
net
|
8,887
|
|
8,892
|
|
|
Long-term marketable
securities
|
13,785
|
|
9,990
|
|
|
Other noncurrent
assets
|
3,865
|
|
2,398
|
|
Total assets
|
$ 144,240
|
|
$ 141,812
|
|
|
|
|
|
|
|
Liabilities and stockholders’
equity:
|
|
|
|
|
|
Accounts payable and accrued
expenses
|
$ 17,563
|
|
$ 15,267
|
|
|
Amounts due to related
parties
|
2,483
|
|
1,785
|
|
|
Deferred revenue
|
3,884
|
|
3,660
|
|
|
Capital lease
obligations
|
93
|
|
133
|
|
Total current
liabilities
|
24,023
|
|
20,845
|
|
|
|
|
|
|
|
Capital lease obligations, net
of current portion
|
30
|
|
40
|
|
Deferred revenue, net of current
portion
|
293
|
|
348
|
|
Other long-term
liabilities
|
239
|
|
279
|
|
Total stockholders’
equity
|
119,655
|
|
120,300
|
|
Total liabilities and
stockholders’ equity
|
$ 144,240
|
|
$ 141,812
|
|
|
|
|
|
|
|
SOURCE Cynosure, Inc.