Natus Medical Incorporated (Nasdaq:BABY) today announced
that it expects to report revenue for the third quarter of 2011 of
approximately $51.5 million, including approximately $1.5 million
from Embla Systems, which the Company acquired on September 15,
2011. Revenue for the core business is below the $58 million that
the Company projected in its financial results call in July
2011.
“The revenue shortfall in the third quarter was primarily in our
neurology business in both domestic and international markets where
we experienced delays in orders and in the United States also a
reduction in order size,” said Jim Hawkins, Chief Executive Officer
of the Company. “Our Medix subsidiary, with newborn care products
sold primarily in South America, also experienced a shortfall due
to delayed orders.”
“Our other newborn care products, including our newborn hearing
screening, newborn brain monitoring, and phototherapy product lines
performed to expectations in the third quarter,” said Hawkins. “The
integration of Embla Systems is also on track and we expect Embla
to contribute $0.08 to non-GAAP earning per share in 2012. As we
discussed in our last conference call, we are taking cost out of
our core businesses in the fourth quarter and throughout 2012.”
Financial Guidance
Natus updated its 2011 financial guidance.
The Company expects to report revenue of approximately $234
million and $65 million for the full year 2011 and fourth quarter
2011, respectively, including approximately $7.5 million from Embla
Systems in the fourth quarter. The Company had earlier said that it
expected to report revenue of approximately $236 million and $61
million for the respective periods.
For the fourth quarter 2011, the Company expects to report
non-GAAP earnings per share of approximately $0.15. The Company had
earlier said that it expected to report non-GAAP earnings per share
of $0.19 to $0.20 for the fourth quarter of 2011.
The Company's fourth quarter 2011 non-GAAP earnings per share
guidance excludes amortization expense associated with
acquisition-related intangible assets, which the Company expects
will fareduce GAAP earnings per share by approximately $0.03. The
non-GAAP earnings per share guidance also does not give effect to
any restructuring charges that the Company may incur in the fourth
quarter 2011, the amount and timing of which have not yet been
determined, as well as the impact of any future acquisitions.
The Company's non-GAAP guidance includes the impact of expensing
employee share based compensation. All non-GAAP earnings per share
amounts are on a diluted basis.
Use of Non-GAAP Financial Measures
The Company's fourth quarter 2011 non-GAAP financial guidance
excludes amortization of acquisition-related intangible assets,
restructuring charges, and the impact that any future acquisitions
may have on results of operations. The Company believes that the
presentation of financial guidance excluding these factors provides
meaningful information to both management and investors that is
indicative of the Company's core operating results. Therefore, the
Company believes its non-GAAP financial guidance facilitates
comparison of operating results across reporting periods.
Conference Call
The Company intends to release its full 2011 third quarter
financial results before the market opens on Thursday, October 27,
2011. Natus management will host an investment-community conference
call the same day beginning at 11:00 a.m. Eastern Time (8:00 a.m.
Pacific Time) to discuss those results and to answer questions.
Individuals interested in listening to the conference call may
do so by dialing 866-277-1182 for domestic callers, or
1-617-597-5359 for international callers, and entering reservation
code 23189279. A telephone replay will be available for 48 hours
following the conclusion of the call by dialing 888-286-8010 for
domestic callers, or 1-617-801-6888 for international callers, and
entering reservation code 85016916.
The conference call also will be available real-time via the
Internet at http://investor.natus.com,
and a recording of the call will be available on the Company's Web
site for 90 days following the completion of the call.
About Natus Medical Incorporated
Natus is a leading provider of healthcare products used for the
screening, detection, treatment, monitoring and tracking of common
medical ailments in newborn care, hearing impairment, neurological
dysfunction, epilepsy, sleep disorders, and balance and mobility
disorders. Product offerings include computerized neurodiagnostic
systems for audiology, neurology, polysomnography, and neonatology,
as well as newborn care products such as hearing screening systems,
phototherapy devices for the treatment of newborn jaundice,
head-cooling products for the treatment of brain injury in
newborns, incubators to control the newborn's environment, and
software systems for managing and tracking disorders and diseases
for public health laboratories.
Additional information about Natus Medical can be found at
www.natus.com.
This press release contains forward-looking statements as
defined in the Private Securities Litigation Reform Act of 1995,
particularly statements regarding the expectations, beliefs, plans,
intentions and strategies of Natus. These forward-looking
statements include statements regarding revenue for the full year
2011, revenue and non-GAAP profitability in the fourth quarter, the
impact of amortization expense associated with acquisition-related
intangible assets, the potential for future restructuring charges,
and the contribution of Embla Systems to earnings in 2012. These
statements relate to current estimates and assumptions of our
management as of the date of this press release, and future events
or Natus' future financial performance or results, and involve
known and unknown risks, uncertainties and other factors that may
cause actual results, levels of activity, performance, or
achievements to differ materially from those expressed or implied
by the forward-looking statements. Forward-looking statements are
only predictions and the actual events or results may differ
materially. Natus cannot provide any assurance that its future
results or the results implied by the forward-looking statements
will meet expectations. Our future results could differ materially
due to a number of factors, including the effects of competition,
the demand for our products and services, the impact of adverse
global economic conditions on our target markets, our ability to
expand our sales in international markets, our ability to maintain
current sales levels in a mature domestic market, our ability to
control costs, risks associated with bringing new products to
market and integrating acquired businesses, and our ability to
fulfill product orders on a timely basis. Natus disclaims any
obligation to update information contained in any forward looking
statement.
More information about potential risk factors that could affect
the business and financial results of Natus is included in Natus'
annual report on Form 10-K for the year ended December 31, 2010,
and its quarterly reports on Form 10-Q, and in other reports filed
from time to time by Natus with the U.S. Securities and Exchange
Commission.
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