STEWARTVILLE, Minn.,
July 30, 2013 /PRNewswire/ --
Rochester Medical Corporation (NASDAQ: ROCM) today announced
operating results for its third quarter ended June 30, 2013.
(Logo:
http://photos.prnewswire.com/prnh/20121228/CG34999LOGO)
The Company reported sales of $16,991,000 for the current quarter compared to
$15,386,000 for the third quarter of
last year. The Company also reported net income of
$1,130,000 or $0.09 per diluted share compared to $496,000 or $0.04
per diluted share for the same period last year.
The approximately 10% increase in sales (11% on a constant
currency basis) resulted from a 12% increase in Rochester Medical
Direct sales (13% on a constant currency basis) and a 5% increase
in Private Label Sales (5% 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.
The Company announced in November
2012 its decision to cease manufacturing and marketing its
line of Foley Catheters. Excluding Foley Catheter sales from
the third quarter of last year and this year, overall direct sales
growth was 20% (21% on a constant currency basis).
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 $1,567,000 or
$0.12 per diluted share compared to
Non-GAAP Net Income of $838,000 or
$0.07 per diluted share for the third
quarter of last year. The increase was primarily due to the
increased profits as a result of increased sales.
Commenting on the third quarter results, Rochester Medical's CEO
and President Anthony J. Conway
said, "We reported another quarter of strong growth, led by
the United States and the
United Kingdom, where Direct
Sales, excluding Foley Catheters, grew 30% and 26%
respectively. We are pleased with our performance this year
and remain on track to achieve our Foley adjusted 2013 guidance for revenue of
approximately $67 million and
after-tax profit of approximately $7
million."
Conference Call and Webcast
The Company will hold a quarterly conference call on
Tuesday July 30th, 2013 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: 888.713.4214
International: 617.213.4866
Pass code: 27798303
PreRegistration:
https://www.theconferencingservice.com/prereg/key.process?key=PL6CJENLW
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: 43964308
Individual investors can listen to the call at
www.fulldisclosure.com, Thomson Reuter'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).
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,
2012, and quarterly reports on Forms 10-Q. 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.
Use of Non-GAAP Financial Measures
Rochester Medical has provided Non-GAAP Net Income in addition
to net income calculated in accordance with generally accepted
accounting principles (GAAP) because management believes Non-GAAP
Net Income 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 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 and constant currency are
not comparable to information provided by other companies. Non-GAAP
Net Income 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 GAAP Net Income and Non-GAAP Net
Income, 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 Mike Piccinino, at
Westwicke Partners (443) 213-0500. More information about
Rochester Medical is available on its website at
http://www.rocm.com.
Rochester Medical
Corporation
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Press Release - F13
Third Quarter
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Condensed
Consolidated Statements Of Operations
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(unaudited)
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(unaudited)
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Three months
ended
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Nine months
ended
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June 30,
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June 30,
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2013
|
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2012
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2013
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2012
|
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Sales
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$
16,991,383
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$
15,385,522
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$
50,878,461
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$
44,785,404
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Cost of
sales
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8,322,926
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7,760,078
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25,341,167
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22,444,487
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Gross
profit
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8,668,457
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7,625,444
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25,537,294
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22,340,917
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Gross profit
%
|
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51.0%
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49.6%
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50.2%
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49.9%
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Costs and
expense:
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Marketing and
selling
|
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4,294,868
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4,611,034
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13,006,092
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13,651,910
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Research and
development
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319,995
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358,551
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971,176
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982,709
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General and
administrative
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2,307,105
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1,942,941
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6,662,811
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6,179,778
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Total operating
expenses
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6,921,968
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6,912,526
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20,640,079
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20,814,397
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Income from
operations
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1,746,489
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712,918
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4,897,215
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1,526,520
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Other income
(expense)
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(926)
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22,251
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(40,744)
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(19,037)
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Net income before
income taxes
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1,745,563
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735,169
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4,856,471
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1,507,483
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Income tax
expense
|
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616,019
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239,245
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1,515,532
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484,392
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Net
income
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$
1,129,544
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$
495,924
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$
3,340,939
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$
1,023,091
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Net income per common
share - Basic
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$
0.09
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$
0.04
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$
0.28
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$
0.09
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Net income per common
share - Diluted
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$
0.09
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$
0.04
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$
0.27
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|
$
0.08
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Weighted Average
Shares:
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Basic
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12,191,778
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12,008,420
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|
12,125,262
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12,036,124
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Weighted Average
Shares:
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Diluted
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12,787,610
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12,373,340
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12,576,126
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12,340,045
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Rochester Medical
Corporation
|
Press Release - F13
Third Quarter
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Condensed
Consolidated Balance Sheets
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(unaudited)
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|
June 30,
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September
30,
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2013
|
2012
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Assets
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Current
Assets
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Cash and
equivalents
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|
$
19,333,989
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$
13,921,363
|
|
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Marketable
securities
|
|
6,899,861
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6,779,695
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Accounts
receivable
|
|
10,332,970
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11,008,429
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|
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Inventories
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9,335,158
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9,883,651
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Prepaid expenses and
other assets
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|
1,984,707
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1,726,908
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Deferred income tax
asset
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587,790
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1,287,177
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Total current
assets
|
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48,474,475
|
44,607,223
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Property and
equipment, net
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13,372,658
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11,862,072
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Deferred income tax
asset
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1,489,812
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1,030,994
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Intangible assets,
net
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8,628,243
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9,377,354
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Goodwill
|
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8,856,518
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9,053,091
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Total
Assets
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|
$
80,821,706
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$
75,930,734
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Liabilities and
Stockholders' Equity
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Current
liabilities:
|
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Accounts
payable
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$
3,292,389
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$
3,070,329
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Accrued
expenses
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3,522,060
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3,427,397
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Total current
liabilities
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6,814,449
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6,497,726
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Long-term
liabilities
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1,157,448
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1,137,212
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Stockholders'
equity
|
|
72,849,809
|
68,295,796
|
|
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|
|
|
|
|
|
Total Liabilities and
Stockholder Equity
|
|
$
80,821,706
|
$
75,930,734
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ROCHESTER MEDICAL
CORPORATION
|
Press Release - F13
Third Quarter
|
For the Nine months
ended
|
June 30, 2013 and
2012
|
|
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|
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|
(unaudited)
|
|
(unaudited)
|
|
|
Three months
ended
|
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Nine months
ended
|
|
|
June 30,
|
|
June 30,
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2013
|
2012
|
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2013
|
2012
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|
GAAP Net Income as
Reported
|
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$
1,129,544
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$
495,924
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$
3,340,939
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$
1,023,091
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Net Income Per Share
- Diluted as Reported
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$
0.09
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$
0.04
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$
0.27
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$
0.08
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Adjustments for
non-recurring unusual items:
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Severance
costs (1)
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-
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-
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124,000
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-
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Foley
Inventory Write-Off (2)
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177,998
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-
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404,428
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-
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Subtotal
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177,998
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-
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528,428
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-
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|
Adjustments for
recurring non-cash expenses:
|
|
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|
Intangible amortization (3)
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|
149,000
|
158,000
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|
453,000
|
474,000
|
ASC 718
compensation expense (4)
|
|
110,000
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184,000
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|
385,000
|
644,000
|
Subtotal
|
|
259,000
|
342,000
|
|
838,000
|
1,118,000
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP Net
Income
|
|
$
1,566,542
|
$
837,924
|
|
$
4,707,367
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$
2,141,091
|
|
|
|
|
|
|
|
Non-GAAP Diluted
EPS
|
|
$
0.12
|
$
0.07
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|
$
0.37
|
$
0.17
|
|
|
|
|
|
|
|
Weighted Average
Shares - Diluted
|
|
12,787,610
|
12,373,340
|
|
12,576,126
|
12,340,045
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(1) Severance costs
associated with our exiting of the Foley catheter market. The
company announced it was exiting the
Foley Catheter market on November 6, 2012. This adjustment adds
back severance costs of certain employees for the three months
ended June 30, 2013. The gross amount of the severance costs for
the three months ended June 30, 2013 is $0 net of taxes of $0
for a net amount of $0. The gross amount of the severance costs for
the nine months ended June 30, 2013 is $171,000 net of taxes of
$47,000 for a net amount of $124,000.
|
(2) Foley inventory
write-off relates to our exiting of the Foley catheter market. The
gross amount of write-offs for the three months ended June 30, 2013
and 2012 is $177,998, and $0. The gross amount of write-off expense
for the nine months ended June 30, 2013 and 2012 is $404,428 and
$0.
|
(3) 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
Rochester Medical BV (formerly Laprolan) from Fornix N.V. This
adjustment adds back amortization expense for the three and six
months ended March 31, 2013 and 2012 related to certain
intangibles. The gross amount of amortization expense for the three
months ended June 30, 2013 and 2012 is $213,000 and $218,000 net of
taxes of $64,000 and $60,000 for net amounts of $149,000 and
$158,000 respectively. The gross amount of amortization expense for
the nine months ended June 30, 2013 and 2012 is $639,000 and
$654,000 net of taxes of $186,000 and $180,000 for net amounts of
$453,000 and $474,000 respectively.
|
(4) 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 nine months ended June 30, 2013 and 2012. The gross
amount of compensation expense for the three months ended June 30,
2013 and 2012 is $207,000 and $212,000 net of taxes of $97,000 and
$28,000 for net amounts of $110,000 and $184,000 respectively. The
gross amount of compensation expense for the nine months ended June
30, 2013 and 2012 is $591,000 and $776,000 net of taxes of $206,000
and $132,000 for net amounts of $385,000 and $644,000
respectively.
|
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ROCHESTER MEDICAL
CORPORATION
|
Press Release - F13
Third Quarter
|
For the Nine months
ended
|
June 30, 2013 and
2012
|
|
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
June 30,
|
|
June 30,
|
|
|
2013
|
2012
|
|
2013
|
2012
|
|
|
|
|
|
|
|
GAAP Sales as
Reported
|
|
$
16,991,383
|
$
15,385,522
|
|
$
50,878,461
|
$
44,785,404
|
British Sterling Exchange rate as reported
|
|
1.54
|
1.58
|
|
1.56
|
1.58
|
Euro
Exchange rate as reported
|
|
1.31
|
1.28
|
|
1.31
|
1.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant Currency
Sales
|
|
$
16,991,383
|
$
15,345,181
|
|
$
50,878,461
|
$
44,705,026
|
(1)
Exchange rate used for Constant Currency Purposes
|
|
1.54
|
1.54
|
|
1.56
|
1.56
|
(2)
Exchange rate used for Constant Currency Purposes
|
|
1.31
|
1.31
|
|
1.31
|
1.31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Effect of
Constant Currency Illustration - British Sterling
|
|
$
-
|
$
(159,042)
|
|
$
-
|
$
(124,337)
|
Net Effect of
Constant Currency Illustration - Euros
|
|
$
-
|
$
41,461
|
|
$
-
|
$
(33,281)
|
|
|
|
|
|
|
|
Total Net Effect of
Constant Currency Illustration
|
|
$
-
|
$
(117,581)
|
|
$
-
|
$
(157,618)
|
|
|
|
|
|
|
|
(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. The rate represents the
average exchange rate for the respective three month
period.
|
(2) For illustrative
purposes constant currency translates prior period foreign sales at
current exchange rates. For Rochester
Medical Corporation this is the conversion rate of Euros to US
dollars. The rate represents the average
exchange rate for the respective three month
period.
|
|
SOURCE Rochester Medical Corporation