EXTON, Pa., Oct. 20, 2011 /PRNewswire/ -- Kensey Nash
Corporation (NASDAQ: KNSY), a medical device company primarily
focused on regenerative medicine for a wide range of medical
procedures, today reported the results for its first fiscal quarter
ended September 30, 2011.
First Quarter Snapshot and Recent Developments
- Adjusted diluted earnings per share* of $0.32, which excludes Norian inventory step-up
amortization (see discussion below), compared to the Company's
previous guidance of $0.29 - $0.32
and prior year diluted earnings per share of $0.41. As reported diluted earnings per
share were $0.26.
- Revenue of $20.0 million, in line
with the Company's previous guidance of $19.5 - $20.0 million and an 18% increase from
the prior year comparable quarter's revenue of $17.0 million.
- Net sales of $14.0 million,
exceeding the Company's previous guidance of $13.6 - $13.9 million and a 29% increase from the
prior year comparable quarter's net sales of $10.9 million.
- Royalty income of $6.0 million,
in line with the Company's previous guidance of $5.9 - $6.1 million and slightly below the prior
year comparable quarter's royalty income of $6.1 million.
- Cash from operations of $7.8
million in the quarter.
- Adjusted EBITDA* of $6.5
million.
President and CEO Commentary
"Despite the persistent high unemployment levels and the
challenging economic climate, our results for the first quarter
were at the upper end of our guidance and we remain on track to
achieve our fiscal 2012 guidance expectations. Our sales for
the quarter increased 29% over prior year driven by strong organic
growth in spine and sports medicine along with a major contribution
from our recent Norian acquisition, which more than offset the loss
of over $4 million in St. Jude
collagen product sales. Although our earnings declined year
over year, as we anticipated due to the loss of the collagen sales
and an increase in R&D expense, we expect to see improvement
throughout the balance of the fiscal year," commented Joe Kaufmann, President and CEO of the Company.
Supplemental Sales Data. Details of the Company's
net sales for the three months ended September 30, 2011 and 2010 are summarized below.
|
|
|
Three Months
Ended
September 30,
|
Year
over
Year %
Change
|
|
($
millions)
|
2011
|
2010
|
|
|
Biomaterials
Products
|
|
|
|
|
Orthopaedic
Products
|
|
|
|
|
Sports
Medicine Products
|
$3.6
|
$2.7
|
36%
|
|
Spine
Products
|
5.4
|
2.5
|
113%
|
|
Trauma & Craniomaxillofacial (CMF)
Products
|
3.7
|
0.1
|
n/c
|
|
Total Orthopaedic
Products
|
$12.7
|
$5.3
|
140%
|
|
Cardiovascular
Products
|
0.2
|
4.3
|
(95%)
|
|
General Surgery
Products
|
0.6
|
0.6
|
6%
|
|
Other Products
|
0.5
|
0.7
|
(35%)
|
|
Total Net Sales
|
$14.0
|
$10.9
|
29%
|
|
|
|
|
|
|
|
First Quarter Ended September 30,
2011 (First Quarter Fiscal 2012) Results
Revenues: Sales and Royalties. Total revenues for
the first quarter of $20.0 million
increased 18% from $17.0 million in
the prior year first quarter and increased 7% sequentially from
$18.7 million in the fourth quarter
of fiscal 2011.
Net sales for the quarter of $14.0
million increased 29% from $10.9
million in the prior fiscal year, and increased 16% from
$12.1 million in the fourth quarter
of fiscal 2011.
Orthopaedic sales of $12.7 million
increased 140% from $5.3 million in
the prior fiscal year quarter, and increased 47% from $8.6 million in the fourth quarter of fiscal
2011. Excluding sales from the Company's May 2011 Norian acquisition, orthopaedic sales of
$8.1 million increased 53% from the
prior year comparable quarter and 11% sequentially from the fourth
quarter of fiscal 2011. Both sports medicine and spine
product sales in the prior year first quarter were negatively
impacted by an overall weakness in the markets and reductions in
inventory levels by two of the Company's major customers.
Sports medicine product sales of $3.6
million increased 36% from $2.7
million in the prior fiscal year quarter, and increased 16%
sequentially from $3.1 million in the
fourth quarter of fiscal 2011. The increase from the prior
year first quarter sales was primarily due to a recovery from the
effect of reductions in customer inventory levels in the prior year
first quarter and to a lesser degree an improvement in the overall
market. Spine product sales of $5.4
million, including $1.0
million in product sales from the Company's Norian
acquisition, increased 113% from $2.5
million in the prior fiscal year quarter and increased 30%
sequentially from $4.1 million in the
fourth quarter of fiscal 2011. The increase in spine product
sales is primarily due to the impact of the Stryker Corporation
(NYSE: SYK) June 2011 acquisition of
Orthovita, our strategic partner. Stryker has a significantly
larger sales force and broader distribution channels. In
addition, during the first quarter of fiscal 2012, there was a
recovery in spine product sales from the effect of reductions in
customer inventory levels in the prior year first quarter.
Sales of trauma and craniomaxillofacial (CMF) products,
consisting almost entirely of $3.6
million in sales resulting from the Norian acquisition,
increased to $3.7 million in the
quarter from $0.1 million in the
prior fiscal year quarter.
Cardiovascular sales of $0.2
million decreased 95% from $4.3
million in the prior fiscal year, and decreased 80% from
$1.0 million in the fourth quarter of
fiscal 2011. As previously disclosed, the Company's new
supply agreement with St. Jude Medical (NYSE: STJ) became effective
January 1, 2011. Under this new
agreement, the Company received orders for $4.0 million of collagen products to be shipped
in the third and fourth quarters of fiscal 2012.
General surgery sales of $0.6
million, consisting primarily of sales of the XCM Biologic
product, increased 6% from $0.6
million in the prior fiscal year, and decreased 50%
sequentially from $1.3 million in the
fourth quarter of fiscal 2011 due to the impact of inventory
stocking orders at the end of the prior fiscal year. Sales of
ECM products were $0.4 million in the
first quarter of fiscal 2012, compared to $0.6 million in the prior year quarter. The
Company expects to experience further increases in ECM product
sales in the second half of fiscal 2012 from continued expansion in
the U.S., as well as markets outside the U.S.
Royalty income of $6.0 million
decreased 1% from $6.1 million in the
prior fiscal year quarter and decreased 9% sequentially from
$6.6 million in the fourth quarter of
fiscal 2011. Royalty income in the first quarter included
$4.5 million in Angio-Seal™ royalties
and $1.4 million in royalties from
Stryker, as a result of their acquisition of Orthovita.
Angio-Seal™ royalties decreased $0.1
million, or 3%, in the first quarter of fiscal 2012 compared
to the prior fiscal year quarter, which may be the result of
increased competition and a reduction in the use of closure
devices. Royalties from Stryker related to the Vitoss Foam
and Bioactive products increased 8% to $1.4
million from $1.3 million in
the prior year comparable quarter. Additionally, the prior
year comparable quarter included royalties of $0.1 million from a license based upon Vitoss
technology that expired in July
2011.
Earnings Per Share. Adjusted first quarter fiscal
2012 diluted earnings per share* were $0.32 (which excludes pre-tax non-cash expense to
cost of goods sold of $0.8 million
from Norian inventory step-up) compared to diluted earnings per
share of $0.41 for the same quarter
of fiscal 2011. As reported diluted earnings per share in the
first quarter of fiscal 2012 were $0.26. Gross margin was also lower as
compared to the prior year quarter due to a product mix of lower
margin Norian product sales as well as lower cardiology product
sales. In addition, research and development expense
increased as compared to the prior year quarter due to larger
investment in the ECM and adhesive product pipelines.
Fiscal 2012 Guidance. The Company is reaffirming
its guidance for fiscal 2012. Total revenues are expected to
be approximately $92 million,
representing an approximate 28% increase from fiscal 2011.
Fiscal 2012 adjusted diluted earnings per share* are expected
to be approximately $1.88 to $1.91,
which excludes the tax-effected non-cash expense of $0.08 per share related to the Norian acquired
inventory step-up. This represents an approximate 20% - 22%
increase from the Company's adjusted diluted fiscal 2011 earnings
per share*. On a GAAP basis, including the impact of
inventory step-up, fiscal 2012 diluted earnings per share are
estimated to be approximately $1.80 to
$1.83. Included in fiscal 2012 diluted earnings per share
and adjusted earnings per share is Norian tax-effected intangible
asset non-cash amortization of approximately $0.07 per share. The following chart
details the Company's expected results for fiscal 2012 by
quarter:
|
|
|
ACTUAL
|
Guidance
|
Guidance
|
Guidance
|
Guidance
|
|
(in
millions, except per share data)
|
Three
Months
Ended
September
30, 2011
|
Three
Months
Ending December
31, 2011
|
Three
Months
Ending March
31, 2012
|
Three
Months
Ending June
30, 2012
|
Fiscal
2012
|
|
Net Sales,
excluding St. Jude Sales
|
$14.0
|
$12.8 -
$13.3
|
$13.5
|
$14.9
|
$55.2 -
$55.5
|
|
St. Jude
Sales
|
-
|
-
|
$2.0
|
$2.0
|
$4.0
|
|
SPNC
Milestone
|
-
|
$5.0
|
$0.3
|
$0.3
|
$5.6
|
|
Net
Sales
|
$14.0
|
$17.8 -
$18.3
|
$15.8
|
$17.2
|
$64.8 -
$65.1
|
|
Royalty
|
$6.0
|
$6.4 -
$6.5
|
$7.0
|
$7.2
|
$26.7 –
26.8
|
|
Revenue
|
$20
|
$24.3 -
$24.8
|
$22.8
|
$24.4
|
$92
|
|
|
|
|
|
|
|
|
EPS
|
$0.26
|
$0.59 -
$0.62
|
$0.44
|
$0.51
|
$1.80 -
$1.83
|
|
Inventory
Step Up Charge
|
$0.8
|
$0.3
|
-
|
-
|
$1.0
|
|
EPS Impact
of Inventory Step Up Charge
|
$0.06
|
$0.02
|
-
|
-
|
$0.08
|
|
Adjusted
EPS
|
$0.32
|
$0.61 -
$0.64
|
$0.44
|
$0.51
|
$1.88 -
$1.91
|
|
|
|
|
|
|
|
|
|
Significantly affecting the Company's revenue and earnings per
share guidance is the expected achievement of a $6.0 million cash milestone from Spectranetics
Corporation (SPNC) in the second quarter of fiscal 2012, of which a
portion would be deferred and recognized over the expected period
of performance. This milestone is due to the Company when
SPNC reaches a cumulative $20 million
in end user sales of the product lines purchased by SPNC from the
Company in May 2008. Also
affecting the Company's quarterly trend of revenue are the expected
product sales to St. Jude Medical during the second half of fiscal
2012 relating to the previously placed orders.
Income Taxes. The Company currently estimates that
its fiscal 2012 effective tax rate will be approximately 33% - 34%.
In the course of estimating the Company's annual effective
tax rate and recording its quarterly income tax provision, the
Company considers many factors, including its expected earnings,
state income tax apportionment, estimated manufacturing and
research and development tax credits, non-taxable interest income
and other estimates. The Company's fiscal 2012 guidance assumes
that the Federal research and development credit will be extended.
Material changes in, or differences from, these estimates
could have a significant impact on the Company's effective tax
rate.
* Adjusted EBITDA and adjusted diluted earnings per share are
non-GAAP financial measures and should not be considered
replacements for GAAP results or guidance. For a
reconciliation of these non-GAAP financial measures to the most
directly comparable GAAP financial measures, see the accompanying
table to this release.
Conference Call and Webcast. The Company will be
hosting a teleconference discussing the earnings results on
Thursday, October 20, 2011 at
9:00 A.M. Eastern Time. To
participate in the teleconference call, please dial 1-612-332-0345.
The teleconference call will also be available for replay starting
Thursday, October 20, 2011 at
11:00 A.M. Eastern Time through
Thursday, October 27, 2011 at
11:59 P.M. Eastern Time by dialing
1-800-475-6701 with an access code of 219581. Individuals
interested in listening to the teleconference may also do so over
the Internet at www.kenseynash.com. To listen to the live
teleconference call, please go to the www.kenseynash.com website
and choose the Investor Relations page. Please allow 15
minutes prior to the start of the call to register and download
and/or install any necessary software. A replay of the
teleconference will be archived on the www.kenseynash.com website
and may be accessed following the teleconference.
About Kensey Nash Corporation. Kensey Nash Corporation is
a medical device company primarily focused on regenerative medicine
utilizing its proprietary collagen and synthetic polymer
technology. The Company is recognized as a leader for
innovative product development and unique technology in the field
of resorbable biomaterials. The Company has an extensive
range of products, which are sold through strategic partners in
multiple medical markets, including the cardiology, orthopaedic,
sports medicine, spine, endovascular and general surgery
markets.
Cautionary Note for Forward-Looking Statements.
This press release contains forward-looking statements,
including statements regarding the current expectations of Kensey
Nash Corporation (the "Company") about its prospects and
opportunities, including the guidance for the Company's fiscal year
2012 and each of the quarters of that year, under the heading
"Fiscal 2012 Guidance" and in the table of non-GAAP financial
measures and reconciliations accompanying this release. The
Company has tried to identify these forward looking statements by
using words such as "expect," "anticipate," "estimate," "plan,"
"will," "would," "should," "forecast," "believe," "guidance,"
"projection" or similar expressions, but these words are not the
exclusive means for identifying such statements. The Company
cautions that a number of risks, uncertainties and other important
factors could cause the Company's actual results to differ
materially from those in the forward-looking statements, including,
without limitation, the Company's success in and the uncertainty of
transitioning the Norian manufacturing operations to the Company
and Synthes success in distributing the Norian products, St. Jude
Medical's success in selling the Angio-Seal device and the extent
to which St. Jude Medical is able to and does in fact rely on its
internal manufacturing to fulfill its requirements for collagen
plugs for the Angio-Seal device, the success of the Company's
customers and partners (including St. Jude Medical, Arthrex,
Stryker and Synthes) in selling Kensey
Nash related products in the marketplace, the Company's
success in its research and development efforts (including in its
cartilage repair, extracellular matrix, adhesive materials and
endovascular programs), the success of clinical trials in both the
U.S. and outside the U.S. to support regulatory approval of the
Company's products, and competition from other technologies, as
well as tax and other risks associated with healthcare reform,
economic conditions and foreign currency fluctuations. For a
detailed discussion of factors that could affect the Company's
future operating results, please see the Company's SEC filings,
including the disclosures under "Risk Factors" in those filings.
Except as expressly required by the federal securities laws,
the Company undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
changed circumstances or future events or for any other reason.
– FINANCIAL INFORMATION TO FOLLOW –
KENSEY NASH
CORPORATION
|
|
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
|
(in
thousands, except per share data)
|
|
(Unaudited)
|
|
|
|
Three
Months
|
|
|
|
Ended
September 30
|
|
|
|
2011
|
|
2010
|
|
Revenues:
|
|
|
|
|
|
Net
sales
|
|
$
14,012
|
|
$ 10,880
|
|
Royalty
income
|
|
6,010
|
|
6,084
|
|
Total revenues
|
|
20,022
|
|
16,964
|
|
Operating costs and
expenses:
|
|
|
|
|
|
Cost of products
sold
|
|
8,226
|
|
4,220
|
|
Research and
development
|
|
5,118
|
|
4,277
|
|
Selling, general
and administrative
|
|
2,804
|
|
2,298
|
|
Total operating costs and expenses
|
|
16,148
|
|
10,795
|
|
Income from
operations
|
|
3,874
|
|
6,169
|
|
Other expense, net
|
|
(435)
|
|
(356)
|
|
Pre-tax income
|
|
3,439
|
|
5,813
|
|
Income tax expense
|
|
1,176
|
|
1,968
|
|
Net income
|
|
$
2,263
|
|
$ 3,845
|
|
Basic earnings per
share
|
|
$
0.26
|
|
$
0.43
|
|
Diluted earnings per
share
|
|
$
0.26
|
|
$
0.41
|
|
Weighted average common shares
outstanding
|
|
8,625
|
|
9,038
|
|
Diluted weighted average common
shares outstanding
|
|
8,734
|
|
9,300
|
|
|
|
|
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(in
thousands)
|
|
(Unaudited)
|
|
|
|
September
30,
|
|
June
30,
|
|
|
|
2011
|
|
2011
|
|
Assets
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
18,016
|
|
$ 10,219
|
|
Investments
|
|
10,389
|
|
11,722
|
|
Trade
receivables
|
|
6,826
|
|
5,804
|
|
Other
receivables
|
|
5,742
|
|
6,727
|
|
Inventory
|
|
15,903
|
|
16,629
|
|
Deferred tax
asset, current
|
|
1,701
|
|
1,564
|
|
Prepaid expenses
and other assets
|
|
1,683
|
|
2,807
|
|
Total current assets
|
|
60,260
|
|
55,472
|
|
Property, plant and equipment,
net
|
|
57,018
|
|
57,949
|
|
Deferred tax asset,
non-current
|
|
8,677
|
|
8,372
|
|
Other non-current
assets
|
|
25,730
|
|
25,127
|
|
Total assets
|
|
$
151,685
|
|
$ 146,920
|
|
|
|
|
|
|
|
Liabilities and Stockholders'
Equity
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable
and accrued expenses
|
|
$
5,666
|
|
$ 4,705
|
|
Other current
liabilities
|
|
1,500
|
|
1,505
|
|
Current portion of
debt
|
|
1,400
|
|
1,400
|
|
Deferred
revenue
|
|
1,038
|
|
947
|
|
Total current liabilities
|
|
9,604
|
|
8,557
|
|
Long-term portion of
debt
|
|
28,233
|
|
28,583
|
|
Deferred revenue,
non-current
|
|
2,230
|
|
2,466
|
|
Long-term deferred acquisition
payments
|
|
15,500
|
|
15,500
|
|
Other non-current
liabilities
|
|
5,697
|
|
4,977
|
|
Total stockholders'
equity
|
|
90,421
|
|
86,837
|
|
Total liabilities and
stockholders' equity
|
|
$
151,685
|
|
$ 146,920
|
|
|
|
|
|
|
Non-GAAP
Financial Measures and Reconciliations
|
|
|
|
As used
herein, “GAAP” refers to generally accepted accounting principles
in the United States. We use various numerical measures in
conference calls, investor meetings and other forums which are or
may be considered "Non-GAAP financial measures" under Regulation G.
We have provided below for your reference supplemental financial
disclosure for these measures, including the most directly
comparable GAAP measures and associated
reconciliations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First
Quarter Fiscal Year 2012 Adjusted Earnings Before Interest, Taxes,
Depreciation and Amortization (EBITDA)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
|
|
|
|
|
|
|
|
|
|
September
30, 2011
|
|
|
|
|
|
|
|
($ millions)
|
|
|
|
|
|
|
|
|
|
|
|
Net Income - GAAP
|
|
|
|
$
2.3
|
|
|
|
|
|
|
|
Inventory Step-up
Amortization expense (a)
|
|
|
|
0.5
|
|
|
|
|
|
|
|
Net Income - As
Adjusted
|
|
|
|
$
2.8
|
|
|
|
|
|
|
|
Income Tax
Expense
|
|
|
|
1.4
|
|
|
|
|
|
|
|
Interest
Income
|
|
|
|
(0.1)
|
|
|
|
|
|
|
|
Interest
Expense
|
|
|
|
0.5
|
|
|
|
|
|
|
|
Depreciation and
Amortization
|
|
|
|
1.9
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
|
$
6.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal 2012
Quarterly and Fiscal Year Adjusted Earnings Per
Share
|
|
(All numbers
presented, except the three months ended September 30, 2011, are
forecasted, subject to the Safe Harbor for Forward-looking
Statements)
|
|
|
|
Actual
|
|
Guidance
|
|
Guidance
|
|
Guidance
|
|
Guidance
|
|
|
|
Three Months
Ended
|
|
Three Months
Ending
|
|
Three Months
Ending
|
|
Three Months
Ending
|
|
Fiscal Year
Ending
|
|
|
|
September
30, 2011
|
|
December 31,
2011
|
|
March 31,
2012
|
|
June 30,
2012
|
|
June 30,
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share -
GAAP
|
|
$
0.26
|
|
$0.59 -
$0.62
|
|
$
0.44
|
|
$
0.51
|
|
$1.80 -
$1.83
|
|
Inventory Step-up Amortization
expense (a)
|
|
0.06
|
|
0.02
|
|
-
|
|
-
|
|
0.08
|
|
Adjusted Diluted Earnings Per
Share
|
|
$
0.32
|
|
$0.61 -
$0.64
|
|
$
0.44
|
|
$
0.51
|
|
$1.88 -
$1.91
|
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Expected
Fiscal 2012 Adjusted Earnings Per Share compared to Fiscal 2011
Adjusted Earnings Per Share
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|
(All Fiscal
2012 numbers presented are forecasted, subject to the Safe Harbor
for Forward-looking Statements)
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|
|
|
|
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|
Actual
|
|
Guidance
|
|
|
|
|
|
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|
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|
Fiscal Year
Ended
|
|
Fiscal Year
Ending
|
|
Increase
from
|
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|
|
|
|
|
|
June 30,
2011
|
|
June 30,
2012
|
|
Prior
Year
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|
Earnings Per Share -
GAAP
|
|
|
|
|
|
$
0.23
|
|
$1.80 -
$1.83
|
|
683% -
696%
|
|
Inventory Step-up Amortization
expense (a)
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|
|
|
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-
|
|
0.08
|
|
|
|
Acquired In-Process Research
& Development (b)
|
|
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|
|
|
1.34
|
|
-
|
|
|
|
Adjusted Diluted Earnings Per
Share
|
|
|
|
|
|
$
1.57
|
|
$1.88 -
$1.91
|
|
20% -
22%
|
|
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(a) Estimated diluted earnings
per share for fiscal 2012 includes acquired inventory step-up
non-cash amortization expense of approximately $1,000,000 ($670,000
net of tax), or $0.08 diluted per share tax-effected, recorded in
connection with the Norian acquisition. This represents the
purchase accounting adjustment related to assigning a fair value to
the acquired inventory at the date of acquisition that adjusted
inventory for the estimated capitalized manufacturing profit in
acquired inventory. This non-recurring, non-cash charge to
cost of products sold will be recorded over the expected inventory
turn-over period, as the capitalized manufacturing profit added to
inventory under purchase accounting is expected to be sold in
approximately five months after the date of acquisition.
Diluted earnings per share for the three months ended
September 30, 2011 includes acquired inventory step-up non-cash
expense of approximately $775,000 ($515,000 net of tax), or $0.06
diluted per share tax-effected, and estimated diluted earnings per
share for the three months ended December 31, 2011 includes
acquired inventory step-up non-cash expense of approximately
$260,000 ($175,000 net of tax), or $0.02 diluted per share
tax-effected.
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|
(b) Diluted earnings per
share for the fiscal year ended June 30, 2011 included acquired
in-process research and development (IPR&D) charges of
approximately $18.2 million ($11.9 million net of tax), or $1.34
diluted per share tax-effected, for the fiscal year ended June 30,
2011. This acquired IPR&D charge was incurred in
connection with the acquisition of the net assets of Nerites
Corporation, a developer of medical adhesives and anti-fouling
coatings, during the third quarter of fiscal 2011.
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|
Note: To supplement our
consolidated financial statements presented in accordance with
GAAP, Kensey Nash Corporation provides and uses non-GAAP measures,
such as Adjusted EBITDA and Adjusted Diluted Earnings Per Share
because Kensey Nash management believes that in order to properly
understand the Company's short-term and long-term financial trends,
investors may wish to consider the impact of certain adjustments
(such as in-process research and development charges, acquisition
related charges including inventory step-up and related income tax
adjustments). These adjustments result from facts and circumstances
(such as business development activities and acquisitions) that
vary in frequency and impact on the Company's results of
operations. Kensey Nash management uses these non-GAAP measures to
forecast and evaluate the operational performance of the Company
and for planning purposes, as well as to compare results of current
periods to prior periods on a consolidated basis. Adjusted
EBITDA represents the Company's GAAP net income adjusted for
inventory step-up amortization and excludes interest, taxes,
depreciation and amortization. Adjusted Diluted Earnings Per
Share is adjusted from GAAP results to exclude certain expenses
described above. These non-GAAP measures are provided to
enhance the user's overall understanding of historical and current
financial performance. The Company believes the non-GAAP
results provide useful information to both management and investors
by excluding certain non-operating items, non-cash expenses and
expenses that the Company believes are not indicative of its core
operating results or future performance.
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|
These non-GAAP measures
provide investors and management with an alternative method for
assessing Kensey Nash’s operating results. Further, these
non-GAAP measures are one of several primary indicators management
uses for planning and forecasting. Non-GAAP financial
measures used by the Company may be calculated differently from,
and therefore may not be comparable to, similarly titled measures
used by other companies. Investors should consider non-GAAP
measures in addition to, and not as a substitute for, or as
superior to, financial performance measures prepared in accordance
with GAAP.
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SOURCE Kensey Nash Corporation