HAYWARD, Calif., Aug. 2, 2011 /PRNewswire/ -- Solta Medical, Inc.
(NASDAQ: SLTM), a global leader in the medical aesthetics market,
today announced results for the second quarter ended June 30, 2011. Second quarter 2011 revenue was
$29.0 million, compared to
$30.1 million in the same period last
year. Revenue from the sales of treatment tips and consumables grew
10% as compared to the second quarter of 2010, and accounted for
55% of total revenue.
GAAP net loss for the quarter was $0.2
million, or approximately breakeven per share, as compared
to GAAP net income of $1.5 million,
or $0.02 per diluted share, for the
second quarter of 2010. Non-GAAP net income for the quarter was
$1.4 million, or $0.02 per diluted share, as compared to non-GAAP
net income of $3.8 million, or
$0.06 per diluted share, for the same
period last year. The previous year’s GAAP and non-GAAP operating
results included a gain on litigation settlement of $2.2 million.
Solta Medical’s GAAP results for the second quarter include
non-cash amortization and other acquisition related charges of
$0.8 million and, non-cash stock
based compensation charges of $0.8
million. The Company provides non-GAAP financial measures
that exclude these charges and expenses. A reconciliation of GAAP
to non-GAAP results is provided in the tables included in this
release.
“Sales of our treatment tips and consumables were up
year-over-year in every region around the world and resulted in an
improvement to our gross margin as compared to last year’s second
quarter. We also produced our seventh consecutive quarter of
non-GAAP operating income,” said Stephen J.
Fanning, Chairman, President, & CEO. “New system sales
of our flagship Fraxel re:store Dual® and Thermage CPT® systems
grew by double-digits in the quarter. In addition, we achieved
double-digit product revenue growth from our direct markets in
Europe and Latin America business units. However, sales
of system upgrades were down year-over-year and we continued to
experience below plan performance in Japan which we believe is attributable to the
unfortunate events in March. With regard to system upgrades, we
have implemented an aggressive sales incentive program to convert
our remaining customer base with legacy systems to the latest
Fraxel and Thermage technologies.”
“We are executing several strategies to advance top-line growth
in the second half of the year,” continued Mr. Fanning. “We
recently initiated commercial shipments of our innovative, new
Clear + Brilliant skin rejuvenation platform which is gaining
momentum with physicians and aesthetic practitioners worldwide. In
June, we also ramped production and expanded the distribution of
our personal care acne device, CLARO®, to additional Nordstrom
stores and Sephora on-line. We expect CLARO to be available at
Sephora retail stores beginning this quarter. Finally, we expect
Philips to introduce our jointly developed, breakthrough laser skin
rejuvenation device for the home, ReAura®, to the European market
in September.”
Financial Outlook for 2011
An update to the Company’s financial outlook for 2011 is as
follows:
- Revenue for the full year 2011 in the range of $115 million to $120 million, representing an
increase of 4% to 8% from 2010 revenue. The company expects
year-over-year revenue growth in the range of 8% to 17% for the
last half of 2011. The revenue growth in the second half of the
year is projected to be driven by recently introduced new products.
The company’s previous revenue outlook for the full year 2011 was a
range of $118 million to $123
million.
- The outlook for non-GAAP gross margin in the range of 66% to
68% for the full year 2011 remains unchanged from the Company’s
previously issued outlook. Non-GAAP gross margin excludes non-cash
amortization charges, non-cash stock based compensation charges,
and acquisition related adjustments. Non-GAAP gross margin for the
six months ended June 30, 2011 was
approximately 69%.
- The outlook for positive non-GAAP EBITDA for every quarter and
for the full-year 2011 remains unchanged from the Company’s
previously issued outlook. Non-GAAP EBITDA excludes non-cash
amortization charges, non-cash stock based compensation charges,
and acquisition related adjustments. The company generated non-GAAP
EBITDA for the first and second quarters of 2011 of $1.5 million and $2.2
million, respectively.
Non-GAAP Presentation
To supplement the condensed consolidated financial information
presented on a GAAP basis, management has provided non-GAAP gross
margin, non-GAAP operating income (loss), non-GAAP EBITDA, non-GAAP
net income (loss) and non-GAAP earnings (loss) per share measures
that exclude the impact of acquisition related adjustments,
severance costs, acquisition related costs, and stock-based
compensation expenses. The Company believes that these
non-GAAP financial measures provide investors with insight into
what is used by management to conduct a more meaningful and
consistent comparison of the Company’s ongoing operating results
and trends, compared with historical results. This
presentation is also consistent with the measures management uses
to measure the performance of ongoing operating results against
prior periods and against our internally developed targets.
There are limitations in using these non-GAAP financial
measures because they are not prepared in accordance with GAAP and
may be different from non-GAAP financial measures used by other
companies. These non-GAAP financial measures should not be
considered in isolation or as a substitute for GAAP financial
measures. Investors and potential investors should consider
non-GAAP financial measures only in conjunction with the Company’s
consolidated financial statements prepared in accordance with GAAP
and the reconciliation of non-GAAP financial measures attached to
this release.
Conference Call Information
The Company will also host a conference call and webcast today,
Tuesday, August 2, 2011, at
4:30 p.m. Eastern Time (1:30 p.m. Pacific) to discuss the financial
results and current corporate developments. The dial-in
number for the conference call is 877-941-0844 for domestic
participants and 480-629-9835 for international participants.
To access the live webcast of the call, go to Solta Medical’s
website at www.solta.com and click on Investor Relations. An
archived webcast will also be available at www.solta.com.
About Solta Medical, Inc.
Solta Medical, Inc. is a global leader in the medical aesthetics
market providing innovative, safe, and effective solutions for
patients that enhance and expand the practice of medical aesthetics
for physicians. The company offers products to address a range of
skin issues under the industry's four premier brands: Thermage®,
Fraxel®, Isolaz®, and CLARO®. Thermage is an innovative,
non-invasive radiofrequency procedure for tightening and contouring
skin. As the leader in fractional laser technology, Fraxel delivers
minimally invasive clinical solutions to resurface aging and sun
damaged skin. Isolaz is the first laser or light based system
indicated for the treatment of inflammatory acne, comedonal acne,
pustular acne, and mild-to-moderate inflammatory acne. CLARO is a
personal care acne system that is the first FDA cleared
over-the-counter IPL device that uses a powerful combination of
both heat and light to clear skin quickly and naturally. Since
2002, over one million Thermage, Fraxel and Isolaz procedures have
been performed in over 100 countries. For more information about
Solta Medical, call 1-877-782-2286 or log on to www.Solta.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the U.S. Private Securities Litigation Reform Act of
1995, including statements regarding our financial outlook for
2011, our intent to convert customers with legacy systems to the
latest Fraxel and Thermage technologies, and our expectations that
Phillips will introduce a product jointly developed with us, and
that our products will be available at Sephora retail stores.
Forward-looking statements are based on management's current,
preliminary expectations and are subject to risks and
uncertainties, which may cause Solta Medical's actual results to
differ materially from the statements contained herein. Factors
that might cause such a difference include the risk that physician
adoption of our systems does not grow, the risk that customers do
not continue to purchase treatment tips, the possibility that the
market for the sale of new products does not develop as expected,
and the risks relating to Solta Medical's ability to achieve its
stated financial goals as a result of, among other things, economic
conditions and consumer and physician confidence causing changes in
consumer and physician spending habits that affect demand for our
products and treatments. Further information on potential risk
factors that could affect Solta Medical's business and its
financial results are detailed in its Form 10-K for the year ended
December 31, 2010, and other reports
as filed from time to time with the Securities and Exchange
Commission. Undue reliance should not be placed on forward-looking
statements, especially guidance on future financial performance,
which speaks only as of the date they are made. Solta Medical
undertakes no obligation to update publicly any forward-looking
statements to reflect new information, events or circumstances
after the date they were made, or to reflect the occurrence of
unanticipated events.
Solta
Medical, Inc.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
(in
thousands of dollars, except share and per share
data)
|
|
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
$28,954
|
|
$30,080
|
|
$55,405
|
|
$56,015
|
|
Cost of revenue
|
10,391
|
|
11,358
|
|
18,781
|
|
20,500
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
18,563
|
|
18,722
|
|
36,624
|
|
35,515
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
11,915
|
|
11,429
|
|
23,733
|
|
21,317
|
|
Research and
development
|
3,648
|
|
4,276
|
|
7,213
|
|
8,395
|
|
General and
administrative
|
3,124
|
|
3,228
|
|
6,850
|
|
7,712
|
|
Legal settlement
gain
|
-
|
|
(2,241)
|
|
-
|
|
(2,213)
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
18,687
|
|
16,692
|
|
37,796
|
|
35,211
|
|
|
|
|
|
|
|
|
|
|
Income (loss) from
operations
|
(124)
|
|
2,030
|
|
(1,172)
|
|
304
|
|
Interest income
|
19
|
|
11
|
|
33
|
|
18
|
|
Interest
expense
|
(21)
|
|
(57)
|
|
(74)
|
|
(118)
|
|
Other income and expense,
net
|
(9)
|
|
(228)
|
|
118
|
|
(317)
|
|
|
|
|
|
|
|
|
|
|
Income (loss) before
income taxes
|
(135)
|
|
1,756
|
|
(1,095)
|
|
(113)
|
|
Provision for income
taxes
|
71
|
|
247
|
|
136
|
|
311
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss)
|
($206)
|
|
$1,509
|
|
($1,231)
|
|
($424)
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share - basic
|
($0.00)
|
|
$0.03
|
|
($0.02)
|
|
($0.01)
|
|
Net income (loss) per
share - diluted
|
($0.00)
|
|
$0.02
|
|
($0.02)
|
|
($0.01)
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding used in calculating net income
|
|
|
|
|
|
|
|
|
(loss) per
share:
|
|
|
|
|
|
|
|
|
Basic
|
60,634,849
|
|
59,437,038
|
|
60,269,804
|
|
58,229,078
|
|
Diluted
|
60,634,849
|
|
61,530,085
|
|
60,269,804
|
|
58,229,078
|
|
|
|
|
|
|
|
|
|
Solta
Medical, Inc.
|
|
NON-GAAP
RECONCILIATION OF GROSS MARGIN, OPERATING INCOME (LOSS), EBITDA,
NET
INCOME (LOSS) AND NET INCOME
(LOSS) PER SHARE
|
|
(in
thousands, except share and per share data)
|
|
(unaudited)
|
|
|
Three Months
Ended
|
|
Six Months
Ended
|
|
|
June
30,
|
|
June
30,
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
GAAP Gross margin
|
$18,563
|
|
$18,722
|
|
$36,624
|
|
$35,515
|
|
GAAP gross margin as % of
sales
|
64%
|
|
62%
|
|
66%
|
|
63%
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments to gross
margin:
|
|
|
|
|
|
|
|
|
GAAP Gross margin
|
$18,563
|
|
$18,722
|
|
$36,624
|
|
$35,515
|
|
Amortization and other non-cash
acquisition related charges
|
844
|
|
1,142
|
|
1,689
|
|
2,002
|
|
Stock-based
compensation
|
95
|
|
68
|
|
164
|
|
142
|
|
Non-GAAP gross margin
|
$19,502
|
|
$19,932
|
|
$38,477
|
|
$37,659
|
|
Non-GAAP gross margin as % of
sales
|
67%
|
|
66%
|
|
69%
|
|
67%
|
|
|
|
|
|
|
|
|
|
|
GAAP income (loss) from
operations
|
($124)
|
|
$2,030
|
|
($1,172)
|
|
$304
|
|
Non-GAAP adjustments to net
income (loss) from operations:
|
|
|
|
|
|
|
|
|
Amortization and other non-cash
acquisition related charges
|
644
|
|
1,430
|
|
1,718
|
|
2,651
|
|
Severance expenses
|
-
|
|
55
|
|
-
|
|
55
|
|
Acquisition-related
expenses
|
120
|
|
139
|
|
120
|
|
963
|
|
Stock-based
compensation
|
812
|
|
618
|
|
1,481
|
|
1,320
|
|
Non-GAAP income from
operations
|
$1,452
|
|
$4,272
|
|
$2,147
|
|
$5,293
|
|
Depreciation expenses
|
763
|
|
742
|
|
1,545
|
|
1,398
|
|
Non-GAAP EBITDA
|
$2,215
|
|
$5,014
|
|
$3,692
|
|
$6,691
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
(loss)
|
($206)
|
|
$1,509
|
|
($1,231)
|
|
($424)
|
|
Non-GAAP adjustments to net
income (loss):
|
|
|
|
|
|
|
|
|
Amortization and other non-cash
acquisition related charges
|
644
|
|
1,430
|
|
1,718
|
|
2,651
|
|
Severance expenses
|
-
|
|
55
|
|
-
|
|
55
|
|
Acquisition-related
expenses
|
120
|
|
139
|
|
120
|
|
963
|
|
Stock-based
compensation
|
812
|
|
618
|
|
1,481
|
|
1,320
|
|
Non-GAAP net income
|
$1,370
|
|
$3,751
|
|
$2,088
|
|
$4,565
|
|
|
|
|
|
|
|
|
|
|
GAAP basic net income (loss) per
share
|
($0.00)
|
|
$0.03
|
|
($0.02)
|
|
($0.01)
|
|
Non-GAAP adjustments to basic
income (loss) per share:
|
|
|
|
|
|
|
|
|
Amortization and other non-cash
acquisition related charges
|
$0.01
|
|
$0.02
|
|
$0.03
|
|
$0.05
|
|
Severance expenses
|
$0.00
|
|
$0.00
|
|
$0.00
|
|
$0.00
|
|
Acquisition-related
expenses
|
$0.00
|
|
$0.00
|
|
$0.00
|
|
$0.02
|
|
Stock-based
compensation
|
$0.01
|
|
$0.01
|
|
$0.02
|
|
$0.02
|
|
Non-GAAP basic net income per
share
|
$0.02
|
|
$0.06
|
|
$0.03
|
|
$0.08
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted net income per
share
|
$0.02
|
|
$0.06
|
|
$0.03
|
|
$0.08
|
|
|
|
|
|
|
|
|
|
|
GAAP weighted average shares
outstanding used in calculating basic net income (loss) per
share
|
60,634,849
|
|
59,437,038
|
|
60,269,804
|
|
58,229,078
|
|
|
|
|
|
|
|
|
|
|
GAAP weighted average shares
outstanding used in calculating diluted net income (loss) per
share
|
60,634,849
|
|
61,530,085
|
|
60,269,804
|
|
58,229,078
|
|
Adjustments for dilutive
potential common stock
|
4,795,261
|
|
888,109
|
|
4,497,589
|
|
2,049,456
|
|
Weighted average shares
outstanding used in calculating non-GAAP diluted net income per
share
|
65,430,110
|
|
62,418,194
|
|
64,767,393
|
|
60,278,534
|
|
|
|
|
|
|
|
|
|
Solta
Medical, Inc.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(in
thousands of dollars, except share and per share
data)
|
|
(unaudited)
|
|
|
|
|
|
|
|
June
30,
|
|
December
31,
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
ASSETS
|
|
Current assets:
|
|
|
|
|
Cash and cash
equivalents
|
$37,108
|
|
$36,898
|
|
Accounts
receivable
|
13,219
|
|
12,426
|
|
Inventories
|
13,541
|
|
10,549
|
|
Prepaid expenses and other
current assets
|
6,241
|
|
5,906
|
|
Total current
assets
|
70,109
|
|
65,779
|
|
Property and equipment,
net
|
5,349
|
|
6,227
|
|
Purchased intangible
assets, net
|
34,624
|
|
36,809
|
|
Goodwill
|
49,481
|
|
49,481
|
|
Other assets
|
578
|
|
249
|
|
Total assets
|
$160,141
|
|
$158,545
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
Liabilities:
|
|
|
|
|
Accounts
payable
|
$7,379
|
|
$6,358
|
|
Accrued
liabilities
|
10,666
|
|
12,030
|
|
Current portion of
deferred revenue
|
4,440
|
|
3,428
|
|
Short-term
borrowings
|
8,874
|
|
9,528
|
|
Customer
deposits
|
666
|
|
441
|
|
Total current
liabilities
|
32,025
|
|
31,785
|
|
Deferred revenue, net of
current portion
|
811
|
|
969
|
|
Term loan, net of current
portion
|
-
|
|
98
|
|
Non-current tax
liabilities
|
3,399
|
|
3,372
|
|
Other
liabilities
|
137
|
|
177
|
|
|
|
|
|
|
Total
liabilities
|
36,372
|
|
36,401
|
|
|
|
|
|
|
Stockholders’
equity:
|
|
|
|
|
Common stock, $0.001 par
value:
|
|
|
|
|
100,000,000 shares
authorized
|
|
|
|
|
60,743,211 and 59,728,410
shares issued and outstanding at June 30, 2011 and December 31,
2010
|
61
|
|
60
|
|
Additional paid-in
capital
|
196,053
|
|
193,198
|
|
Accumulated
deficit
|
(72,345)
|
|
(71,114)
|
|
|
|
|
|
|
Total stockholders’
equity
|
123,769
|
|
122,144
|
|
|
|
|
|
|
Total liabilities and
stockholders’ equity
|
$160,141
|
|
$158,545
|
|
|
|
|
|
SOURCE Solta Medical, Inc.