IRVINE, Calif., July 22 /PRNewswire-FirstCall/ -- Endologix, Inc.
(Nasdaq: ELGX), developer of minimally invasive treatments for
aortic disorders, today announced financial results for the three
and six months ended June 30,
2010.
John McDermott, Endologix
President and Chief Executive Officer, said, "During the second
quarter we continued to benefit from improved performance by our
U.S. sales team and strong international demand for our products.
We expect these trends to continue in the second half of the year,
with additional strength from the full market launch of our new
Powerlink product line extensions during the fourth quarter. In
addition, we remain on track with our 30% sales force expansion and
R&D investments to further broaden our product line and treat
more patients with aortic disorders."
Mr. McDermott added, "There continues to be growing physician
interest in our unique anatomical fixation approach to aortic
aneurysm repair, which has been bolstered by the initiation of our
PEVAR (Percutaneous Endovascular Aneurysm Repair) clinical trial.
We enrolled our first patient in the second quarter and now have
over 80% of the participating sites evaluating patients. We expect
to complete enrollment in 2011 and be the only company with a
percutaneous indication in 2012. During the second quarter, the
clinical effectiveness of anatomical fixation was further validated
through the publication of new data in the peer-reviewed Journal of
Endovascular Therapy. Consolidated results from three FDA
multi-center studies demonstrate exceptional long-term results for
patients treated with our Powerlink stent graft for the
endovascular repair of abdominal aortic aneurysms."
Financial Results
Total revenue in the second quarter of 2010 was $15.7 million, a 19% increase from $13.2 million in the second quarter of 2009.
Domestic revenue was a record $12.8
million, a 12% increase from $11.4
million in the second quarter of 2009. International
revenue was $2.9 million, a 65%
increase from $1.8 million in the
second quarter of 2009. For the six months ended June 30, 2010, total revenue increased 21% to
$30.1 million, compared with
$25.0 million for the six months
ended June 30, 2009.
Gross profit was $12.0 million in
the second quarter of 2010, representing a gross margin of 77%.
This compares with gross profit of $9.9
million and a gross margin of 75% in the second quarter of
2009. Gross profit was $23.2
million for the six months ended June
30, 2010, representing a gross margin of 77%. This compares
with gross profit of $18.8 million
and a gross margin of 75% for the six months ended June 30, 2009. Higher gross margin for the three
and six months ended June 30, 2010
was driven by more favorable product mix due to new products and
manufacturing cost reductions.
Total operating expenses were $12.2
million in the second quarter of 2010, compared with
$10.3 million in the second quarter
of 2009. Marketing and sales expenses increased to $7.6 million in the second quarter of 2010 from
$6.6 million in the same period last
year. Research, development and clinical expenses increased to
$2.4 million in the second quarter of
2010 from $1.5 million in the same
period last year. General and administrative expenses were
$2.2 million for both the second
quarter of 2010 and for the same period of 2009.
Total operating expenses for the six months ended June 30, 2010 were $23.6
million, compared with $20.3
million for the six months ended June
30, 2009. Marketing and sales expenses increased to
$14.6 million in the first six months
of 2010, up from $13.2 million in the
same period last year. Research, development and clinical expenses
increased to $4.7 million in the
first six months of 2010, up from $2.9
million in the same period last year. General and
administrative expenses were $4.3
million for the first six months of both 2009 and 2010.
Endologix reported a net loss for the second quarter of 2010 of
$380,000, or $(0.01) per share, compared with a net loss of
$425,000, or $(0.01) per share, for the second quarter of
2009. The net loss in the second quarter of 2010 included other
expenses of $198,000 related to
foreign currency loss due to the decline in value of the Euro
during the quarter. For the six months ended June 30, 2010, the Company reported a net loss of
$605,000, or $(0.01) per share, compared with a net loss of
$1.6 million, or $(0.04) per share, for the six months ended
June 30, 2009.
Total cash and cash equivalents were $22.4 million as of June
30, 2010, compared with total cash and cash equivalents of
$24.1 million as of December 31, 2009.
"We achieved a sequential improvement in gross margin during the
second quarter due to increased volumes and manufacturing
efficiencies," stated Endologix Chief Financial Officer
Bob Krist. "We ended the quarter
with $22.4 million in cash and cash
equivalents, down sequentially by $127,000 due to increased working capital to
support sales growth. For the full year 2010, we expect to fully
fund our investments in the sales force expansion and new product
pipeline with internally generated cash flow."
Financial Guidance
Based on the results for the first six months of 2010, the
Company is reiterating its full year 2010 revenue and GAAP earnings
per share guidance. The Company anticipates 2010 revenue to
be in the range of $62 million to $66
million, representing annual growth of 18% to 26%. For
the full year 2010, the Company expects to generate positive GAAP
earnings per share. The Company's GAAP EPS guidance assumes
planned investments in the sales force, research and development,
and clinical initiatives and excludes the potential impact of
litigation, acquisitions or other business development
transactions.
Conference Call Information
Endologix management will host a conference call to discuss
these topics today beginning at 5:00 p.m.
Eastern time (2:00 p.m. Pacific
time). To participate via telephone please call (877)
407-0789 from the U.S. or (201) 689-8562 from outside the U.S. A
telephone replay will be available for seven days following the
completion of the call by dialing (877) 870-5176 from the U.S. or
(858) 384-5517 from outside the U.S., and entering pin number
353355. The conference call will be broadcast live over the
Internet at www.endologix.com and will be available for 30
days.
About Endologix
Endologix, Inc. develops and manufactures minimally invasive
treatments for aortic disorders. The Company's flagship product is
the Powerlink® System, which is an endovascular stent graft for the
treatment of abdominal aortic aneurysms (AAA). AAA is a weakening
of the wall of the aorta, the largest artery in the body, resulting
in a balloon-like enlargement. Once AAA develops, it continues to
enlarge and, if left untreated, becomes increasingly susceptible to
rupture. The overall patient mortality rate for ruptured AAA is
approximately 75%, making it a leading cause of death in the U.S.
Additional information can be found on Endologix's Web site at
www.endologix.com.
Except for historical information contained herein, this news
release contains forward-looking statements, including with respect
to 2010 financial guidance, the launch of new products, expansion
of the number of sales territories in 2010, planned investments in
research and development activities, and clinical trial
initiatives, the accuracy of which are necessarily subject to risks
and uncertainties, all of which are difficult or impossible to
predict accurately and many of which are beyond the control of
Endologix. Many factors may cause actual results to differ
materially from anticipated results, including the success of sales
efforts for the Powerlink System and related new products, product
research and development efforts, and other economic, business,
competitive, legal matters and regulatory factors. The Company
undertakes no obligation to update its forward looking statements.
Please refer to the Company's Annual Report on Form 10-K for the
year ended December 31, 2009, and the
Company's other filings with the Securities and Exchange
Commission, for more detailed information regarding these risks and
other factors that may cause actual results to differ materially
from those expressed or implied.
|
|
|
|
|
COMPANY
CONTACT:
|
INVESTOR
CONTACTS:
|
|
Endologix, Inc.
|
The Ruth Group
|
|
John McDermott, CEO
|
Nick Laudico (646)
536-7030
|
|
(949) 595-7200
|
Zack Kubow (646)
536-7020
|
|
www.endologix.com
|
|
|
|
|
|
|
ENDOLOGIX, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
Unaudited
(In thousands, except per share
amounts)
|
|
|
Three Months
Ended
June 30,
|
Six Months Ended
June 30,
|
|
|
2010
|
2009
|
2010
|
2009
|
|
Revenue:
|
|
|
|
|
|
Domestic revenue
|
$12,762
|
$11,410
|
$24,777
|
$21,586
|
|
International revenue
|
2,892
|
1,758
|
5,357
|
3,416
|
|
Total revenue
|
15,654
|
13,168
|
30,134
|
25,002
|
|
Cost of revenue
|
3,612
|
3,256
|
6,973
|
6,161
|
|
Gross profit
|
12,042
|
9,912
|
23,161
|
18,841
|
|
Operating expenses:
|
|
|
|
|
|
Research, development and
clinical
|
2,426
|
1,495
|
4,701
|
2,853
|
|
Marketing and sales
|
7,590
|
6,570
|
14,567
|
13,192
|
|
General and
administrative
|
2,213
|
2,234
|
4,284
|
4,299
|
|
Total operating
expenses
|
12,229
|
10,299
|
23,552
|
20,344
|
|
Loss from operations
|
(187)
|
(387)
|
(391)
|
(1,503)
|
|
Other income (loss):
|
|
|
|
|
|
Interest income
(expense)
|
5
|
(55)
|
4
|
(105)
|
|
Other income
(expense)
|
(198)
|
17
|
(218)
|
6
|
|
Total other income
(expense)
|
(193)
|
(38)
|
(214)
|
(99)
|
|
Net loss
|
($380)
|
($425)
|
($605)
|
($1,602)
|
|
Basic and diluted net loss per
share
|
($0.01)
|
($0.01)
|
($0.01)
|
($0.04)
|
|
Shares used
in computing basic and
diluted net
loss per share
|
48,325
|
43,351
|
48,160
|
43,348
|
|
|
|
|
|
|
|
|
ENDOLOGIX, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
Unaudited
(In thousands)
|
|
|
June 30,
2010
|
December 31,
2009
|
|
ASSETS
|
|
|
|
Current assets:
|
|
|
|
Cash and cash
equivalents
|
$22,428
|
$24,065
|
|
Accounts receivable,
net
|
11,119
|
8,342
|
|
Other receivables
|
116
|
3
|
|
Inventories
|
6,315
|
5,540
|
|
Other current assets
|
350
|
389
|
|
Total current assets
|
40,328
|
38,339
|
|
Property and equipment,
net
|
2,172
|
2,089
|
|
Goodwill
|
4,631
|
4,631
|
|
Intangibles,
net
|
5,401
|
6,104
|
|
Other assets
|
176
|
129
|
|
Total Assets
|
$52,708
|
$51,292
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
Current liabilities:
|
|
|
|
Accounts payable and accrued
expenses
|
$6,929
|
$7,199
|
|
Current portion of long term
debt
|
81
|
79
|
|
Current liabilities
|
7,010
|
7,278
|
|
Long term
liabilities:
|
|
|
|
Long term debt
|
42
|
83
|
|
Other long term
liabilities
|
1,040
|
1,051
|
|
Long
term liabilities
|
1,082
|
1,134
|
|
Total
liabilities
|
8,092
|
8,412
|
|
Stockholders' equity:
|
|
|
|
Common
stock, $.001 par value; 75,000 shares authorized, and 49,453
and
49,152 shares issued, and 48,958
and 48,657 outstanding
|
49
|
49
|
|
Additional paid-in
capital
|
191,997
|
189,656
|
|
Accumulated deficit
|
(146,769)
|
(146,164)
|
|
Treasury stock at cost, 495
shares
|
(661)
|
(661)
|
|
Total stockholders'
equity
|
44,616
|
42,880
|
|
Total Liabilities and
Stockholders' Equity
|
$52,708
|
$51,292
|
|
|
|
|
|
|
SOURCE Endologix, Inc.