STEWARTVILLE, Minn.,
Nov. 3, 2011 /PRNewswire/ --
Rochester Medical Corporation (NASDAQ: ROCM) today announced
operating results for its fourth quarter and fiscal year ended
September 30, 2011.
The Company reported record sales of $14,839,000 for the fourth quarter of fiscal 2011
compared to $11,121,000 for the
fourth quarter of last year. It also reported quarterly net
income of $407,000 or $.03 per diluted share compared to net income of
$172,000 or $.01 per diluted share for the same quarter of
last year.
Fourth quarter sales increased 33% year over year (32% on a
constant currency basis) driven by a 46% increase in Rochester
Medical Direct Sales (43% on a constant currency basis) and a 1%
decrease in Private Label Sales (1% decrease on a constant currency
basis). Constant currency basis assumes current exchange
rates for all periods in order to exclude the impact of foreign
exchange variations. In the fourth 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 income adjusted for certain non-recurring unusual items and
certain recurring non-cash expenses, or "Non-GAAP Net Income" for
the current quarter was $822,000 or
$.07 per diluted share compared to
Non-GAAP Net Income of $506,000 or
$.04 per diluted share for the fourth
quarter of last year. The increase in Non-GAAP Net Income in
the fourth quarter of fiscal 2011 is primarily attributable to
improvement in gross profit as a result of the higher sales versus
last year, partially offset by increased investment in sales and
marketing programs.
Direct Sales to the Home Care market, which comprised 86% of
fiscal 2011 total Rochester Medical Direct Sales grew approximately
49% to $10.7 million this quarter
from $7.2 million dollars in last
year's fourth quarter. The increase resulted from a 54%
increase in International Direct Home Care Sales (49% constant
currency growth) and a 33% increase in U.S. Direct Home Care Sales.
Direct sales to the Acute Care market, which comprised 14% of
fiscal 2011 total Rochester Medical Direct Sales, grew 25% to just
over $1.2 million this quarter from
just under $1 million dollars in the
fourth quarter of last year. The increase came from a 32%
increase in International Direct Acute Care Sales (30% constant
currency growth) and an 18% increase in U.S. Direct Acute Care
Sales.
For the fiscal year ended September 30,
2011, the Company reported record sales of $52,919,000 compared to sales of $41,443,000 for the previous year. The 28%
increase in annual total sales (26% on a constant current basis)
resulted from a 39% increase in Rochester Medical Direct Sales (37%
on a constant currency basis) and a 2% decrease (constant currency)
in Private Label Sales. The Company reported a net loss for
the year of ($1,315,000) or
($0.11) per diluted share compared to
a net loss of ($254,000) or
($0.02) per diluted share for the
previous year. The decrease in net income for the fiscal year
was primarily attributable to significantly increased investment in
sales and marketing programs and one time costs related to the
acquisition of Laprolan.
Non-GAAP Net Income for the current year was $1,073,000 or $0.09
per diluted share compared to Non-GAAP Net Income of $1,220,000 or $0.09
per diluted share for the previous year. The decrease was
primarily due to significantly increased investment in sales and
marketing programs.
Commenting on today's announcement Rochester Medical's CEO and
President Anthony J. Conway said,
"The Company has made significant strides over the past year.
The Laprolan acquisition, the significant expansion of our
sales and marketing force, and important new product introductions
have all contributed to strong growth and have us well positioned
for the future."
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 Reuters and can be
accessed at Rochester Medical's website at www.rocm.com. To
listen live to the conference call via telephone, call:
Domestic:
|
888 680
0879
|
|
International:
|
617 213
4856
|
|
Pass code:
|
68095248
|
|
Pre Registration:
|
|
|
https://www.theconferencingservice.com/prereg/key.process?key=PJK9R37WH
|
|
Replay will be available for
seven days at www.rocm.com or via
telephone at:
|
|
Domestic:
|
888 286
8010
|
|
International:
|
+1 617 801 6888
|
|
Pass code:
|
32357873
|
|
|
|
Individual investors can listen to the call at
www.fulldisclosure.com, Thomson Reuters 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.
Summary
Statements Of Operations
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
|
|
|
Three months
ended
|
|
Twelve
months ended
|
|
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
|
|
$ 14,839,311
|
|
$ 11,121,229
|
|
$ 52,918,875
|
|
$ 41,442,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
|
|
7,504,817
|
|
5,731,716
|
|
26,821,427
|
|
21,739,014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit
|
|
|
7,334,494
|
|
5,389,513
|
|
26,097,448
|
|
19,703,666
|
|
|
Gross profit %
|
|
|
49.4%
|
|
48.5%
|
|
49.3%
|
|
47.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Marketing and selling
|
|
4,834,419
|
|
3,068,288
|
|
18,966,887
|
|
11,868,737
|
|
|
Research and
development
|
|
256,266
|
|
304,548
|
|
1,008,767
|
|
1,235,367
|
|
|
General and
administrative
|
|
1,656,038
|
|
1,583,246
|
|
7,799,210
|
|
6,391,003
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
6,746,723
|
|
4,956,082
|
|
27,774,864
|
|
19,495,107
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
|
587,771
|
|
433,431
|
|
(1,677,416)
|
|
208,559
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income
(expense)
|
|
(138,355)
|
|
79,073
|
|
(261,050)
|
|
61,770
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) before income
taxes
|
449,416
|
|
512,504
|
|
(1,938,466)
|
|
270,329
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
|
42,277
|
|
340,485
|
|
(623,162)
|
|
523,864
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
|
$
407,139
|
|
$
172,019
|
|
$ (1,315,304)
|
|
$
(253,535)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common
share - Basic
|
$
0.03
|
|
$
0.01
|
|
$
(0.11)
|
|
$
(0.02)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per common
share - Diluted
|
$
0.03
|
|
$
0.01
|
|
$
(0.11)
|
|
$
(0.02)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares:
|
|
12,205,299
|
|
12,142,764
|
|
12,217,900
|
|
12,181,549
|
|
|
Basic
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares:
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
|
12,470,989
|
|
12,785,996
|
|
12,217,900
|
|
12,181,549
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed
Balance Sheets
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
|
|
Cash and equivalents
|
|
$
8,722,935
|
|
$
4,545,907
|
|
|
|
Marketable securities
|
|
26,182,308
|
|
30,967,007
|
|
|
|
Accounts receivable
|
|
8,644,332
|
|
7,858,540
|
|
|
|
Inventories
|
|
11,278,694
|
|
9,240,291
|
|
|
|
Prepaid expenses and other
assets
|
|
1,361,259
|
|
846,899
|
|
|
|
Deferred income tax
|
|
1,618,495
|
|
872,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
57,808,023
|
|
54,331,493
|
|
|
|
|
|
|
|
|
|
|
|
Property and equipment,
net
|
|
12,052,685
|
|
10,017,239
|
|
|
Deferred income tax
|
|
1,242,010
|
|
1,175,052
|
|
|
Intangible assets,
net
|
|
10,272,671
|
|
5,580,726
|
|
|
Goodwill
|
|
|
9,764,075
|
|
4,561,781
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets
|
|
$ 91,139,464
|
|
$ 75,666,291
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
2,773,398
|
|
$
2,016,058
|
|
|
|
Accrued expenses
|
|
2,961,270
|
|
2,069,222
|
|
|
|
Short-term debt
|
|
17,862,185
|
|
2,641,233
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current
liabilities
|
|
23,596,853
|
|
6,726,513
|
|
|
|
|
|
|
|
|
|
|
|
Long-term liabilities
|
|
1,565,764
|
|
46,327
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' equity
|
|
65,976,847
|
|
68,893,451
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities and
Stockholder's Equity
|
|
$ 91,139,464
|
|
$ 75,666,291
|
|
|
|
|
|
|
|
|
|
ROCHESTER MEDICAL
CORPORATION
|
|
Reconciliation of Reported GAAP
Revenue to Non-GAAP Revenue in Constant Currency
|
|
For the Three and Twelve months
ended
|
|
September 30, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
Three months
ended
|
|
Twelve
months ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
2010
|
|
2011
|
2010
|
|
|
|
|
|
|
|
|
|
GAAP Sales as
Reported
|
|
$
14,839,311
|
$
11,121,229
|
|
$
52,918,875
|
$
41,442,680
|
|
Exchange rate as Reported
|
|
1.61
|
1.55
|
|
1.61
|
1.56
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant Currency
Sales
|
|
$
14,839,311
|
$
11,278,699
|
|
$
52,918,875
|
$
41,933,592
|
|
(1) Exchange rate
used for Constant Currency Purposes
|
|
1.61
|
1.61
|
|
1.61
|
1.61
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Effect of Constant Currency
Illustration
|
|
$
-
|
$
157,470
|
|
$
-
|
$
490,912
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(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
twelve 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 Income (Loss) to Non-GAAP Net Income
|
|
For the Three and Twelve months
ended
|
|
September 30, 2011 and
2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
|
Three months
ended
|
|
Twelve
months ended
|
|
|
|
September
30,
|
|
September
30,
|
|
|
|
2011
|
2010
|
|
2011
|
2010
|
|
|
|
|
|
|
|
|
|
GAAP Net Income (Loss) as
Reported
|
|
$
407,000
|
$
172,000
|
|
$
(1,315,000)
|
$
(254,000)
|
|
|
|
|
|
|
|
|
|
Diluted EPS as
Reported
|
|
$
0.03
|
$
0.01
|
|
$
(0.11)
|
$
(0.02)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for non-recurring
unusual items:
|
|
|
|
|
|
|
|
Merger and acquisition
costs for Laprolan (1)
|
|
30,000
|
-
|
|
725,000
|
-
|
|
Subtotal
|
|
30,000
|
-
|
|
725,000
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments for recurring
non-cash expenses:
|
|
|
|
|
|
|
|
Intangible amortization
(2)
|
|
183,000
|
129,000
|
|
701,000
|
515,000
|
|
ASC 718 compensation
expense (3)
|
|
202,000
|
205,000
|
|
962,000
|
959,000
|
|
Subtotal
|
|
385,000
|
334,000
|
|
1,663,000
|
1,474,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net Income
|
|
$
822,000
|
$
506,000
|
|
$
1,073,000
|
$
1,220,000
|
|
|
|
|
|
|
|
|
|
Non-GAAP Diluted EPS
|
|
$
0.07
|
$
0.04
|
|
$
0.09
|
$
0.09
|
|
|
|
|
|
|
|
|
|
Weighted Average Shares -
Diluted
|
|
12,470,989
|
12,785,996
|
|
12,282,545
|
12,888,394
|
|
|
|
|
|
|
|
|
(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
twelve months ended September 30, 2011 and 2010 related to certain
intangibles. The gross amount of amortization
expense for the three months ended September 30, 2011 and 2010 is
$236,000 and $163,000 net of taxes of $53,000 and $34,000 for net
amounts of $183,000 and $129,000 respectively. The gross
amount of amortization expense for the twelve months ended
September 30, 2011 and 2010 is $901,000 and $652,000 net of
taxes of $200,000 and $137,000 for net amounts of $701,000 and
$515,000 respectively.
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(3)
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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
twelve months ended September 30, 2011 and 2010.
The gross amount of compensation expense for the three months
ended September 30, 2011 and 2010 is $316,000 and $317,000 net of
taxes of $114,000 and $112,000 for net amounts of $202,000 and
$205,000 respectively. The gross amount of compensation
expense for the twelve months ended September
30, 2011 and 2010 is $1,495,000 and $1,481,000 net of taxes of
$533,000 and $522,000 for net amounts of $962,000
and $959,000 respectively.
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SOURCE Rochester Medical Corporation