Cardiac Science Announces 2003 Third Quarter, Nine-Month Results
AED Revenue for Quarter Up 57%, Operating Loss Cut by 91% IRVINE,
Calif., Oct. 28 /PRNewswire-FirstCall/ -- Cardiac Science, Inc. , a
leading manufacturer of life-saving automated public access
defibrillators (AEDs) and provider of comprehensive AED/CPR
training and AED program management services, today reported
revenue of $15.7 million for the third quarter ended September 30,
2003 as compared to $13.6 million in the same period last year.
Sales of AEDs and related accessories in the third quarter totaled
$15.0 million representing an increase of 57 percent over the prior
year quarter. For the nine months, sales of AEDs and related
accessories totaled $40.4 million and were up 56 percent over the
same period last year. At quarter end, the Company had an order
backlog of $630,000, due primarily to higher-than-expected demand
for the new Powerheart(R) AED G3 product line released for
commercial sale in August. The gross margin for the third quarter
of 2003 increased to 60.5 percent from 50.0 percent in the same
prior year period and was up sequentially from 57.2 percent in the
second quarter of 2003. The company narrowed its operating loss
significantly to $264,000 in the third quarter of 2003, compared to
a $2.8 million loss in the same period last year, and down from the
$621,000 operating loss in the 2003 second quarter. The net loss in
the third quarter decreased to $1.5 million, or a $0.02 loss per
share, down from $4.1 million, or a $0.06 loss per share, in the
corresponding prior year period. Revenue for the nine months ended
September 30, 2003 was $44.3 million, a 24 percent increase over
the $35.8 million for the year-earlier period. The net loss for the
nine months was $6 million, or a $0.09 loss per share, as compared
to $11.4 million, or a $0.17 loss per share, in 2002. Cardiac
Science Chairman and CEO Raymond W. Cohen said, "Customer demand
for our new Powerheart(R) AED G3 and FirstSave(R) AED G3 devices
exceeded our expectations and most customers purchased our flagship
device, the Powerheart AED G3. Although we limited sales of the new
generation AEDs to the U.S. market, nearly 60 percent of the all
AEDs sold were the new generation products which challenged our
ability to fill demand within the quarter. The result was a strong
sequential increase in gross margin between the second and third
quarters and a backlog of unfilled orders moving into the fourth
quarter. Had we been able to ship all orders, we would have
achieved our objective of operating profitability in the third
quarter." In the third quarter, more than 8,000 AED units were sold
to a wide variety of market segments worldwide, representing an
increase in unit sales of 82 percent as compared to the 4,400
devices sold in the same period last year. The two strongest
sectors within the domestic AED market were corporate workplaces
and municipalities. Combined, these segments accounted for over 78
percent of the total number of AEDs sold in the United States.
International AED sales were up 122 percent over the prior year
period and accounted for 16 percent of the quarter's total AED
revenue. In the quarter, sales of Diascope(R) patient monitors to
international distributors totaled $210,000 as compared to $3.6
million in corresponding 2002 period. During the 2002 period, the
Company sold off the remaining inventory produced in its
manufacturing facility in Denmark, which was shut down during third
quarter 2002. This quarter, International demand for our Diascope
monitors, especially in the Middle East, where the company has sold
the majority of those units, was again weak as instability and poor
economic conditions continued to delay buying decisions in those
countries. Sales of disposable defibrillator pads and equipment
related to deployment of the Powerheart CRM product in the hospital
market was $238,000 in the third quarter of 2003. About Cardiac
Science Cardiac Science develops, manufactures and markets
Powerheart(R)-brand public-access defibrillators (AEDs) and offers
comprehensive AED/CPR training and program management services that
facilitate successful deployments. The Company also manufactures
its AED products on a private label basis for other leading medical
companies. Cardiac Science's AEDs, Diascope(R)-brand patient
monitors and Powerheart(R) CRM(TM), the only FDA-cleared
therapeutic patient monitor that instantly and automatically treats
hospitalized cardiac patients who suffer life-threatening heart
rhythms are marketed in the United States by its 55-person sales
force, numerous domestic distribution channel partners and by
international distributors in more than 50 countries around the
world. For more information, please visit
http://www.cardiacscience.com/ . This news release contains
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Cardiac Science cautions
that these statements are subject to substantial risks and
uncertainties and are qualified by important factors that could
cause actual results to differ materially from those reflected by
the forward-looking statements and should not be relied upon by
investors when making an investment decision. Information on these
and other factors is detailed in the Company's Form 10-K for the
year ending December 31, 2002, subsequent quarterly filings, and
other documents filed by the Company with the Securities and
Exchange Commission. For further information, please contact:
investors, Matt Clawson, , or media, Len Hall, , both of Allen
& Caron Inc, +1-949-474-4300, for Cardiac Science, Inc.; or
Roderick de Greef, Chief Financial Officer of Cardiac Science,
Inc., +1-949-797-3800, Cardiac Science, Inc. Consolidated Statement
of Operations (Unaudited) In thousands, except share and per share
amounts Three Months Ended Nine Months Ended September 30,
September 30, 2003 2002 2003 2002 Revenue $15,728 $13,588 $44,279
$35,790 Cost of Goods Sold 6,217 6,788 18,527 18,364 Gross Profit
9,511 6,800 25,752 17,426 Operating Expenses: Sales and Marketing
4,564 4,505 12,927 11,971 Research and Development 1,444 1,588
3,939 4,758 General and Administrative 3,386 2,946 9,800 8,473
Amortization of Intangibles 381 550 1,211 1,609 Gain on Settlement
-- -- -- (832) Total Operating Expenses 9,775 9,589 27,877 25,979
Operating Loss (264) (2,789) (2,125) (8,553) Interest and other
income/(expense) (1,482) (1,310) (4,366) (2,791) Operating loss
before provision for income taxes (1,746) (4,099) (6,491) (11,344)
Provision for income taxes -- -- -- -- Loss before minority
interest (1,746) (4,099) (6,491) (11,344) Minority interest in
subsidiary -- (37) (48) (26) Income from discontinued operations
256 -- 493 -- Net loss $(1,490) $(4,136) $(6,046) $(11,370) Net
loss per share (basic and diluted) $(0.02) $(0.06) $(0.09) $(0.17)
Weighted average number of shares used in the computation of net
loss per share 67,398,421 67,291,483 67,050,032 67,229,121 Cardiac
Science, Inc. Condensed Consolidated Balance Sheets In thousands
September 30 December 31, 2003 2002 (Unaudited) ASSETS Current
Assets: Cash and cash equivalents $14,176 $15,598 Accounts
receivable, net 17,579 10,986 Inventory 8,466 5,918 Prepaid
expenses 1,584 2,098 Assets held-for-sale -- 1,161 Total Current
Assets 41,805 35,761 Property and Equipment, net 5,608 5,206
Goodwill and other intangibles, net 105,233 106,546 Other assets
3,980 6,407 $156,626 $153,920 LIABILITIES AND STOCKHOLDERS EQUITY
Current Liabilities: Accounts Payable $7,593 $6,921 Liabilities
held-for-sale -- 2,067 Accrued expenses and other current
liabilities 4,510 7,596 Total current liabilities 12,103 16,584
Long term notes payable 45,060 41,054 Other long term liabilities
949 1,112 Minority Interest -- 900 Total stockholder's equity
98,514 94,270 $156,626 $153,920 DATASOURCE: Cardiac Science, Inc.
CONTACT: investors, Matt Clawson, , or media, Len Hall, , both of
Allen & Caron Inc, +1-949-474-4300, for Cardiac Science, Inc.;
or Roderick de Greef, Chief Financial Officer of Cardiac Science,
Inc., +1-949-797-3800, Web site: http://www.cardiacscience.com/
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