STEWARTVILLE, Minn.,
May 5, 2011 /PRNewswire/ -- Rochester
Medical Corporation (NASDAQ: ROCM) today announced operating
results for its second quarter ended March
31, 2011.
The Company reported record sales of $12,853,000 for the current quarter compared to
$9,845,000 for the second quarter of
last year. It also reported net loss of ($1,259,000) or ($0.10) per diluted share compared to net loss of
($351,000) or ($0.03) per diluted share for the same quarter of
last year.
The approximate 31% increase in sales (29% on constant currency
basis) resulted from a 39% increase in Rochester Medical Direct
Sales (37% on a constant currency basis) and an 8% increase in
Private Label Sales (8% on a constant currency basis). Direct Sales
include sales made directly to the end consumer and include all
Rochester Medical branded sales, UK Script Easy sales, and all
Laprolan sales. Beginning with the second quarter of this
fiscal year, the Company's operating results include the operating
results of Laprolan B.V., the Company's newly acquired subsidiary
in The Netherlands.
Constant currency basis assumes current exchange rates for all
periods in order to exclude the impact of foreign exchange
variations. In the second quarter of fiscal 2011, the U.S.
dollar was somewhat weaker versus the pound sterling thus
positively affecting Rochester Medical Direct Sales growth levels
in actual U.S. dollars given the significant volume of direct sales
in the United Kingdom.
Net loss adjusted for certain non-recurring unusual items and
certain recurring non-cash expenses, or "Non-GAAP Net Income
(Loss)" for the current quarter was ($437,000) or ($.04) per diluted share compared to Non-GAAP Net
Income of $140,000 or $.01 per diluted share for the second quarter of
last year. The net loss for the current quarter is
attributable to the recent significant increase in the Company's
strategic investment in Sales and Marketing. In the second quarter
the completed expansion of the U.S. sales and marketing force added
over a million dollars in incremental costs compared to the same
period last year. The Company believes the investment will
generate significant increases in revenue over the next few
years.
Commenting on today's results Rochester Medical's CEO and
President Anthony J. Conway said,
"The excellent 37% constant currency growth in Direct Sales for the
quarter was in large part due to the Laprolan acquisition
reinforced by continued solid growth in Direct Sales of 24% in the
combined U.S. and U.K. markets where we have a sales force
presence. The growth was partially offset by a decline in
Direct Sales in other parts of the world due to timing of orders
and shipments.
"I want to thank our Laprolan employees for their spirit of
co-operation and excitement as they have become an important part
of the Rochester Medical Team. Now, with significant presence
in the U.K., The Netherlands, and
the United States, and with sales
in countries throughout the world, we are truly becoming a
recognized global leader in our field."
Conway concluded, "By fiscal year end we expect to be operating
profitably. Looking ahead, we are strongly focused on growing the
top line, flattening costs, and generating profits."
Acquisition of Laprolan B.V.
On April 7, 2011, Rochester
Medical announced the completed acquisition of Laprolan B.V., the
former Medical Supplies Division and wholly owned subsidiary of
Fornix BioSciences N.V. Under the terms of the purchase agreement
the purchase is deemed retroactive to January 1, 2011. The final purchase price for
Laprolan B.V., was $14,878,125 net of
interest paid.
Agreement with Teleflex Incorporated
Rochester Medical today announced an exclusive agreement with
Teleflex Incorporated whereby they will market and sell Rochester
Medical's Strata-NF Anti-Infection Foley Catheter in a number of
countries in mainland Europe.
Conference Call and Webcast
The Company will hold a quarterly conference call today to
discuss its earnings report. The call will begin at
3:30 p.m. central time (4:30 p.m. eastern time).
This call is being webcast by Thomson/CCBN and can be accessed
at Rochester Medical's website at www.rocm.com. To listen
live to the conference call via telephone, call:
Domestic:
|
888.713.4211
|
|
International:
|
617.213.4864
|
|
Pass code:
|
65580251
|
|
Pre Registration:
https://www.theconferencingservice.com/prereg/key.process?key=P6YE3FJK6
|
|
Replay will be available for
seven days at www.rocm.com or via
telephone at:
|
|
Domestic:
|
888-286-8010
|
|
International:
|
617-801-6888
|
|
Pass code:
|
70081655
|
|
|
|
Individual investors can listen to the call at
www.fulldisclosure.com, Thomson/CCBN's individual investor portal,
powered by StreetEvents. Institutional investors can access
the call via Thomson's password-protected event management site,
StreetEvents (www.streetevents.com).
Use of Non-GAAP Financial Measures
Rochester Medical has provided Non-GAAP Net Income (Loss) in
addition to net income (loss) calculated in accordance with
generally accepted accounting principles (GAAP) because management
believes Non-GAAP Net Income (Loss) provides a more consistent
basis for comparisons that are not influenced by certain charges
and non-cash expenses and are therefore helpful in understanding
Rochester Medical's underlying operating results. Similarly,
constant currency represents reported sales with the cost/benefit
of currency movements removed. Management uses the measure to
understand the growth of the business on a constant dollar basis,
as fluctuations in exchange rates can distort the underlying growth
of the business both positively and negatively. While we
recognize that foreign exchange volatility is a reality for a
global company, we routinely review our Company performance on a
constant dollar basis, and we believe this also allows our
shareholders to understand better our Company's growth trends.
Non-GAAP Net Income (Loss) and constant currency are not
measures of financial performance under GAAP, and should not be
considered an alternative to net income or any other measure of
performance or liquidity under GAAP. Non-GAAP Net Income (Loss) and
constant currency are not comparable to information provided by
other companies. Non-GAAP Net Income (Loss) and constant currency
have limitations as analytical tools and should not be considered
in isolation or as a substitution for analysis of our results as
reported under GAAP. Reconciliations of Net Loss and Non-GAAP
Net Income (Loss), and reconciliations of sales under GAAP and
sales on a constant currency basis, are presented at the end of
this press release.
About Rochester Medical Corporation
Rochester Medical Corporation develops, manufactures, and
markets disposable medical catheters and devices for urological and
continence care applications. The Company also sells certain
ostomy and wound and scar care products and other brands of
urological products into the European marketplace.
For further information, please contact Anthony J. Conway, President and Chief Executive
Officer or David A. Jonas, Chief
Financial Officer of Rochester Medical Corporation at (507)
533-9600 or Parice Halbert, CFA, at
Westwicke Partners (443) 213-0500. More information about
Rochester Medical is available on its website at
http://www.rocm.com.
Forward-Looking Statements
This press release contains "forward-looking statements" with
the meaning of the Private Securities Litigation Reform Act of
1995. Such statements include, but are not limited to,
statements about the future financial and operating results of
Rochester Medical. Such statements are based on currently
available information, operating plans and management's
expectations about future events and trends. Such statements
inherently involve significant risks and uncertainties that could
cause actual results to differ materially from those predicted in
such forward-looking statements, including the uncertainty of
estimated revenues and profits, the uncertainty of current domestic
and international economic conditions that could adversely affect
the level of demand for the Company's products and increased
volatility in foreign exchange rates, the uncertainty of market
acceptance of new product introductions and our level of success in
increasing Rochester Medical Direct Sales revenue, the
uncertainty of gaining new strategic relationships or locating and
capitalizing on strategic opportunities, the uncertainty of timing
of Private Label Sales revenues (particularly international
customers), FDA and other regulatory review and response times, and
other risk factors listed from time to time in the Company's SEC
reports and filings, including, without limitation, the section
entitled "Risk Factors" in the Company's Annual Report on Form 10-K
for the year ended September 30,
2010, and reports on Forms 10-Q and 8-K. Readers are
cautioned not to place undue reliance on any such forward-looking
statements, which speak only as of the date they are made.
The Company undertakes no obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Rochester Medical
Corporation
|
|
Press Release - F11 Second
Quarter
|
|
|
|
|
Summary
Statements Of Operations
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
|
March
31,
|
|
March
31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
$ 12,852,601
|
|
$ 9,845,480
|
|
$ 23,799,006
|
|
$ 20,077,292
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
6,493,407
|
|
5,186,396
|
|
12,035,681
|
|
10,805,100
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
6,359,194
|
|
4,659,084
|
|
11,763,325
|
|
9,272,192
|
|
|
Gross profit %
|
49.5%
|
|
47.3%
|
|
49.4%
|
|
46.2%
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
Marketing and selling
|
5,012,747
|
|
2,871,675
|
|
8,894,727
|
|
5,648,992
|
|
|
Research and
development
|
251,672
|
|
241,390
|
|
529,527
|
|
684,418
|
|
|
General and
administrative
|
2,403,698
|
|
1,747,604
|
|
4,112,791
|
|
3,438,351
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
7,668,117
|
|
4,860,669
|
|
13,537,045
|
|
9,771,761
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
(1,308,923)
|
|
(201,585)
|
|
(1,773,720)
|
|
(499,569)
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
51,977
|
|
49,717
|
|
104,547
|
|
105,373
|
|
|
Interest expense
|
(123,596)
|
|
(39,470)
|
|
(154,855)
|
|
(80,588)
|
|
|
Other income
|
(12,865)
|
|
(34,739)
|
|
(29,147)
|
|
(61,386)
|
|
|
|
|
|
|
|
|
|
|
|
Net loss before income
taxes
|
(1,393,407)
|
|
(226,077)
|
|
(1,853,175)
|
|
(536,170)
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense(benefit)
|
(134,009)
|
|
125,339
|
|
(424,695)
|
|
(15,596)
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
$ (1,259,398)
|
|
$ (351,416)
|
|
$ (1,428,480)
|
|
$
(520,574)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per common share -
Basic
|
$
(0.10)
|
|
$
(0.03)
|
|
$
(0.12)
|
|
$
(0.04)
|
|
|
|
|
|
|
|
|
|
|
|
Loss per common share -
Diluted
|
$
(0.10)
|
|
$
(0.03)
|
|
$
(0.12)
|
|
$
(0.04)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares:
|
12,223,347
|
|
12,195,334
|
|
12,174,780
|
|
12,193,441
|
|
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares:
|
|
|
|
|
|
|
|
|
|
Diluted
|
12,223,347
|
|
12,195,334
|
|
12,174,780
|
|
12,193,441
|
|
|
|
|
|
|
|
|
|
|
Rochester Medical
Corporation
|
|
Press Release - F11 Second
Quarter
|
|
|
|
|
|
Condensed
Balance Sheets
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
March
31,
|
|
September
30,
|
|
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
Cash and equivalents
|
$ 4,889,264
|
|
$
4,545,907
|
|
|
Marketable securities
|
29,468,851
|
|
30,967,007
|
|
|
Accounts receivable
|
9,179,768
|
|
7,858,540
|
|
|
Inventories
|
11,867,139
|
|
9,240,291
|
|
|
Prepaid expenses and other
assets
|
2,236,128
|
|
846,899
|
|
|
Deferred income tax
|
851,562
|
|
872,849
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
58,492,712
|
|
54,331,493
|
|
|
|
|
|
|
|
|
Property and equipment,
net
|
11,929,967
|
|
10,017,239
|
|
Deferred income tax
|
1,195,440
|
|
1,175,052
|
|
Intangible assets,
net
|
11,159,888
|
|
5,580,726
|
|
Goodwill
|
|
10,680,572
|
|
4,561,781
|
|
|
|
|
|
|
|
|
Total Assets
|
$ 93,458,579
|
|
$ 75,666,291
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
|
$ 2,893,187
|
|
$
2,016,058
|
|
|
Accrued expenses
|
2,294,800
|
|
2,069,222
|
|
|
Short-term debt
|
16,723,998
|
|
2,641,233
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
21,911,985
|
|
6,726,513
|
|
|
|
|
|
|
|
|
Long-term liabilities
|
1,698,738
|
|
46,327
|
|
|
|
|
|
|
|
|
Stockholders' equity
|
69,847,856
|
|
68,893,451
|
|
|
|
|
|
|
|
|
Total Liabilities and
Stockholder's Equity
|
$ 93,458,579
|
|
$ 75,666,291
|
|
|
|
|
|
|
|
ROCHESTER MEDICAL
CORPORATION
|
|
Reconciliation of Reported GAAP
Revenue to Non-GAAP Revenue in Constant Currency
|
|
For the Three and Six months
ended
|
|
March 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
March
31,
|
|
March
31,
|
|
|
2011
|
2010
|
|
2011
|
2010
|
|
|
|
|
|
|
|
|
GAAP Sales as
Reported
|
$
12,852,601
|
$
9,845,480
|
|
$
23,799,006
|
$
20,077,292
|
|
Exchange rate as Reported
|
1.60
|
1.56
|
|
1.59
|
1.60
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant Currency
Sales
|
$
12,852,601
|
$
9,947,168
|
|
$
23,799,006
|
$
20,056,899
|
|
(1) Exchange rate
used for Constant Currency Purposes
|
1.60
|
1.60
|
|
1.59
|
1.59
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Effect of Constant Currency
Illustration
|
$
-
|
$
101,688
|
|
$
-
|
$
(20,393)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For illustrative purposes
Constant currency translates prior period foreign sales at current
exchange rates. For Rochester Medical Corporation this
is the conversion rate of British pounds to US dollars and the Euro
to US Dollars. The rate represents the
average exchange rate for the respective three or six month period.
For fiscal 2011 there will be no rate variance from the Euro
to the US dollar.
|
|
|
|
|
|
|
|
ROCHESTER MEDICAL
CORPORATION
|
|
Reconciliation of Reported GAAP
Net (Loss) to Non-GAAP Net Income (Loss)
|
|
For the Three and Six months
ended
|
|
March 31, 2011 and
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
Three months
ended
|
|
Six months
ended
|
|
|
March
31,
|
|
March
31,
|
|
|
2011
|
2010
|
|
2011
|
2010
|
|
|
|
|
|
|
|
|
GAAP Net Income (Loss) as
Reported
|
$
(1,259,000)
|
$
(351,000)
|
|
$
(1,428,000)
|
$
(521,000)
|
|
|
|
|
|
|
|
|
Diluted EPS as
Reported
|
$
(0.10)
|
$
(0.03)
|
|
$
(0.12)
|
$
(0.04)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for non-recurring
unusual items:
|
|
|
|
|
|
|
Merger and acquisition
costs for Laprolan (1)
|
255,000
|
-
|
|
391,000
|
-
|
|
Subtotal
|
255,000
|
-
|
|
391,000
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for recurring
non-cash expenses:
|
|
|
|
|
|
|
Intangible amortization
(2)
|
195,000
|
129,000
|
|
323,000
|
258,000
|
|
ASC 718 compensation
expense (3)
|
372,000
|
362,000
|
|
567,000
|
550,000
|
|
Subtotal
|
567,000
|
491,000
|
|
890,000
|
808,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income
(Loss)
|
$
(437,000)
|
$
140,000
|
|
$
(147,000)
|
$
287,000
|
|
|
|
|
|
|
|
|
Non-GAAP Diluted EPS
|
$
(0.04)
|
$
0.01
|
|
$
(0.01)
|
$
0.02
|
|
|
|
|
|
|
|
|
Weighted Average Shares -
Diluted
|
12,223,347
|
12,768,464
|
|
12,174,780
|
12,703,486
|
|
|
|
|
|
|
|
|
(1) Merger and acquisition costs
related to the purchase of Laprolan B.V. from Fornix
N.V.
|
|
|
|
(2) Amortization of the
intangibles acquired in June 2006 asset acquisition from Coloplast
AS and Mentor Corporation and the intangibles acquired in the
January 2011 acquisition of Laprolan from Fornix N.V. Management
believes these assets are appreciating. This adjustment adds
back amortization expense for the three and sixth months ended
March 31, 2011 and 2010 related to certain intangibles. The gross
amount of amortization expense for the three months ended March 31,
2011 and 2010 is $251,000 and $163,000 net of taxes of $56,000 and
$34,000 for net amounts of $195,000 and $129,000 respectively.
The gross amount of amortization expense for the six months
ended March 31, 2011 and 2010 is $414,000 and $326,000 net of taxes
of $91,000 and $68,000 for net amounts of $323,000 and $258,000
respectively.
|
|
|
|
(3) Compensation expense
mandated by ASC 718. This adjustment adds back the
compensation expense recorded for stock options granted to
employees and directors that vested during the three and sixth
months ended March 31, 2011 and 2010. The gross amount of
compensation expense for the three months ended March 31, 2011 and
2010 is $582,000 and $565,000 net of taxes of $210,000 and $203,000
for net amounts of $372,000 and $362,000 respectively. The
gross amount of compensation expense for the six months ended March
31, 2011 and 2010 is $877,000 and $850,000 net of taxes of $310,000
and $300,000 for net amounts of $567,000 and $550,000
respectively.
|
|
|
|
|
|
|
|
SOURCE Rochester Medical Corporation