Palomar Medical Reports Financial Results for Second Quarter 2010
July 29 2010 - 8:00AM
Palomar Medical Technologies, Inc. (Nasdaq:PMTI), a leading
researcher and developer of light-based systems for cosmetic
treatments, today announced financial results for the second
quarter ended June 30, 2010. Revenues for the quarter ended June
30, 2010 were $15.6 million, which represents a 4 percent increase
over the $15.0 million reported in the second quarter of 2009.
Product and service revenues increased to $13.0 million, an 8
percent increase over the $12.1 million in the second quarter of
2009. Second quarter gross margin from product and service revenues
was 63 percent, an increase over the 57 percent in the second
quarter of 2009. Loss before income taxes for the second quarter
ended June 30, 2010 was $1.7 million, which included a $0.7 million
patent litigation expense and a $1.0 million non-cash FAS 123R
stock-based compensation expense. The Company reported net loss of
$1.7 million, or $0.09 per share for the second quarter of
2010. The balance sheet continues to be strong with $102
million in cash and cash equivalents with no borrowings.
Chief Executive Officer Joseph P. Caruso commented, "We are
again pleased with the increase in product and service revenues
this quarter as compared to the prior year. Our extensive
product portfolio and platform approach has been well received and
positioned for this economic climate. It allows our sales team
to configure our technology solutions to fit physicians' sites
throughout the world regardless of the particular economic pressure
they are experiencing. Our gross margin growth indicates a big
improvement over the previous year. We have worked hard to
implement a number of cost cutting initiatives and have introduced
new technology contributing to the increase in gross margin over
last year. We are also pleased that 41% of our revenue was
contributed from recurring sources other than one-time capital
equipment sales. During the second quarter, we opened an
office in Japan that provides us with a direct sales force and
service support to grow our business in that part of the
world."
Mr. Caruso continued, "We continue to invest in our consumer
products. We have finalized our product branding and
positioning. We are also setting up our initial manufacturing
line at our facility for a launch on target by year end."
Conference Call: As previously announced,
Palomar will conduct a conference call and webcast today at 11:30
AM Eastern Time. Management will discuss financial results and
strategic matters. If you would like to participate, please call
(866) 783-2143 or listen to the webcast in the About
Palomar/Investors section of the Company's website at
www.palomarmedical.com. A webcast replay will also be
available.
About Palomar Medical Technologies Inc.:
Palomar is a leading researcher and developer of light-based
systems for cosmetic treatments. Palomar pioneered the optical hair
removal field, when, in 1997, it introduced the first high-powered
laser hair removal system. Since then, many of the major advances
in light-based hair removal have been based on Palomar technology.
In December 2006, Palomar became the first company to receive a
510(k) over-the-counter (OTC) clearance from the United States Food
and Drug Administration (FDA) for a new, patented, home-use,
light-based hair removal device. In June 2009, Palomar became the
first company to receive a 510(k) OTC clearance from the FDA for a
new, patented, home-use, laser device for the treatment of
periorbital wrinkles. OTC clearance allows these products to be
marketed and sold directly to consumers without a prescription.
There are now millions of light-based cosmetic procedures performed
around the world every year in physician offices, clinics, spas and
salons. Palomar is testing many new and exciting applications
to further advance the hair removal market and other cosmetic
applications. Palomar is focused on developing proprietary
light-based technology for introduction to the mass markets.
For more information on Palomar and its products, visit
Palomar's website at www.palomarmedical.com. To continue receiving
the most up-to-date information and latest news on Palomar as it
happens, sign up to receive automatic e-mail alerts by going to the
About Palomar/Investors section of the website.
With the exception of the historical information contained in
this release, the matters described herein contain forward-looking
statements, including, but not limited to, statements relating to
new markets, future royalty amounts due from third parties,
development and introduction of new products, and financial and
operating projections. These forward-looking statements are neither
promises nor guarantees, but involve risk and uncertainties that
may individually or mutually impact the matters herein, and cause
actual results, events and performance to differ materially from
such forward-looking statements. These risk factors include, but
are not limited to, results of future operations, technological
difficulties in developing or introducing new products, the results
of future research, lack of product demand and market acceptance
for current and future products, the effect of economic conditions,
challenges in managing joint ventures and research with third
parties and government contracts, the impact of competitive
products and pricing, governmental regulations with respect to
medical devices, including whether FDA clearance will be obtained
for future products and additional applications, the results of
litigation, difficulties in collecting royalties, potential
infringement of third-party intellectual property rights, factors
affecting the Company's future income and resulting ability to
utilize its NOLs, and/or other factors, which are detailed from
time to time in the Company's SEC reports, including the report on
Form 10-K for the year ended December 31, 2009 and the Company's
quarterly reports on Form 10-Q. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date hereof. The Company undertakes no obligation to
release publicly the result of any revisions to these
forward-looking statements that may be made to reflect events or
circumstances after the date hereof or to reflect the occurrence of
unanticipated events.
|
Palomar Financial Summary: |
Consolidated Statements
of Operations (Unaudited) |
|
|
|
|
Three Months Ended June
30, |
Six Months Ended June 30, |
|
2010 |
2009 |
2010 |
2009 |
Revenues: |
|
|
|
|
Product revenues |
$ 9,214,967 |
$ 8,336,298 |
$18,382,233 |
$ 16,410,848 |
Service revenues |
3,818,265 |
3,784,558 |
7,763,135 |
7,183,562 |
Royalty revenues |
1,306,927 |
1,274,593 |
2,945,145 |
2,768,017 |
Funded product development revenues |
-- |
398,467 |
-- |
829,600 |
Other revenues |
1,250,000 |
1,250,000 |
2,500,000 |
2,500,000 |
Total revenues |
15,590,159 |
15,043,916 |
31,590,513 |
29,692,027 |
|
|
|
|
|
Costs and expenses: |
|
|
|
|
Cost of product revenues |
3,484,575 |
3,624,178 |
6,801,768 |
6,975,427 |
Cost of service revenues |
1,298,580 |
1,642,555 |
2,953,123 |
3,515,977 |
Cost of royalty revenues |
522,771 |
509,838 |
1,178,058 |
1,107,207 |
Research and development |
3,589,269 |
3,076,501 |
7,775,069 |
6,819,968 |
Selling and marketing |
4,900,214 |
4,732,921 |
9,744,810 |
9,401,802 |
General and administrative |
3,360,348 |
2,241,311 |
7,312,031 |
5,114,557 |
Total costs and
expenses |
17,155,757 |
15,827,304 |
35,764,859 |
32,934,938 |
|
|
|
|
|
Loss from
operations |
(1,565,598) |
(783,388) |
(4,174,346) |
(3,242,911) |
|
|
|
|
|
Interest income |
90,866 |
140,447 |
207,917 |
333,648 |
Other (expense)
income |
(191,454) |
376,754 |
(184,662) |
349,820 |
|
|
|
|
|
Loss before income
taxes |
(1,666,186) |
(266,187) |
(4,151,091) |
(2,559,443) |
|
|
|
|
|
Provision for (benefit from)
income taxes |
28,868 |
(22,265) |
48,002 |
(901,071) |
|
|
|
|
|
Net loss |
$ (1,695,054) |
$ (243,922) |
$ (4,199,093) |
$(1,658,372) |
|
|
|
|
|
Net loss per share: |
|
|
|
|
Basic |
$ (0.09) |
$ (0.01) |
$ (0.23) |
$ (0.09) |
Diluted |
$ (0.09) |
$ (0.01) |
$ (0.23) |
$ (0.09) |
|
|
|
|
|
Weighted average shares
outstanding: |
|
|
|
|
Basic |
18,536,076 |
18,049,402 |
18,528,650 |
18,054,485 |
Diluted |
18,536,076 |
18,049,402 |
18,528,650 |
18,054,485 |
|
|
|
|
|
|
Consolidated Balance Sheets
(Unaudited) |
|
|
|
June 30, 2010 |
December 31, 2009 |
Assets |
|
|
|
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ 102,119,967 |
$ 81,948,482 |
Short-term investments |
-- |
25,000,000 |
Total cash, cash equivalents and
short-term investments |
102,119,967 |
106,948,482 |
Accounts receivable, net |
3,967,009 |
4,436,219 |
Inventories |
11,507,313 |
11,126,352 |
Other current assets |
1,952,838 |
2,179,233 |
Total current assets |
119,547,127 |
124,690,286 |
|
|
|
Marketable securities, at estimated
fair value |
2,376,358 |
4,024,313 |
|
|
|
Property and equipment,
net |
37,218,190 |
34,629,410 |
|
|
|
Other assets |
219,652 |
126,087 |
|
|
|
Total assets |
$ 159,361,327 |
$ 163,470,096 |
|
|
|
Liabilities and Stockholders'
Equity |
|
|
|
|
|
Current Liabilities: |
|
|
Accounts payable |
$ 2,794,968 |
$ 2,696,217 |
Accrued liabilities |
8,487,928 |
8,959,679 |
Deferred revenue |
3,766,268 |
5,221,924 |
Total current liabilities |
15,049,164 |
16,877,820 |
|
|
|
Accrued income taxes |
2,973,717 |
2,965,077 |
|
|
|
Total liabilities |
$ 18,022,881 |
$ 19,842,897 |
|
|
|
Stockholders' equity: |
|
|
Preferred stock, $.01 par value-- |
|
|
Authorized - 1,500,000 shares |
|
|
Issued -- none |
-- |
-- |
Common stock, $.01 par value-- |
|
|
Authorized – 45,000,000 shares |
|
|
Issued – 18,550,977 and 18,521,045
shares, respectively |
185,510 |
185,211 |
Additional paid-in capital |
208,701,598 |
206,740,492 |
Accumulated other comprehensive loss |
(343,362) |
(292,297) |
Accumulated deficit |
(67,205,300) |
(63,006,207) |
Total stockholders' equity |
$ 141,338,446 |
$ 143,627,199 |
|
|
|
Total liabilities and stockholders'
equity |
$ 159,361,327 |
$ 163,470,096 |
CONTACT: Palomar Medical Technologies, Inc.
Kerry McAnistan, Investor Relations Assistant
781-993-2411
ir@palomarmedical.com
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