HAYWARD, Calif., Nov. 1, 2011 /PRNewswire/ -- Solta Medical, Inc.
(NASDAQ: SLTM), a global leader in the medical aesthetics market,
today reported product revenue grew year-over-year by 14% for the
third quarter ended September 30,
2011. Sales of new systems and upgrades rose year-over-year
by $1.8 million, or 19%, to
$11.1 million. Revenue from treatment
tips and other consumables of $14.9
million grew $1.4 million, or
11%, as compared to the third quarter of 2010, and accounted for
54% of total revenue. Total revenue for the quarter of $27.4 million increased $2.6 million, or 10%, compared to the same period
last year reflecting a year-over-year decline in research funding
revenue of approximately $1.0
million.
GAAP net loss for the quarter was $1.1
million, or $0.02 per share,
as compared to a GAAP net loss of $1.4
million, or $0.02 per share,
for the third quarter of 2010. Non-GAAP net income for the quarter
was $1.5 million, or $0.02 per diluted share, as compared to non-GAAP
net income of $0.5 million, or
$0.01 per diluted share, for the same
period last year.
Solta Medical’s GAAP results for the third quarter include
amortization and other acquisition related charges of $1.8 million, including transaction costs
associated with the acquisition of Medicis Technologies Corporation
(f/k/a LipoSonix, Inc.), 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.
“Worldwide product revenue from systems and consumables grew
year-over-year by 14% as we generated solid growth in North America, Asia, and Europe,” said Stephen J. Fanning, Chairman, President, &
CEO. “The third quarter marked our eighth consecutive quarter of
positive non-GAAP operating income. In addition, we demonstrated
our ability to leverage our operating infrastructure, as our
revenue growth of $2.6 million
produced incremental non-GAAP operating income of $1.8 million.”
“In the third quarter, our innovative Clear + Brilliant skin
rejuvenation platform continued to gain significant traction with
physicians and aesthetic practitioners worldwide,” continued Mr.
Fanning. “Based on system placements in a given quarter, we sold
more Clear + Brilliant devices than any other product in the past
three years.”
The Company also announced that the second generation LipoSonix
system has received CE Mark certification in addition to the
previously announced FDA clearance of the product. Initiation of
commercial launch activities for the major markets of U.S.,
Europe, and Asia are underway.
“With the acquisition of Medicis Technologies Corporation
completed today, we look forward to entering the fast growing
non-invasive fat reduction market with the second generation
LipoSonix system. We expect to place a number of the LipoSonix
systems with key opinion leaders in December and plan for a
worldwide roll-out in the first quarter of 2012,” concluded Mr.
Fanning.
Financial Outlook
An update to the Company’s financial outlook for 2011 is as
follows:
- The company currently expects revenue for the fourth quarter of
2011 to grow to $32 million to $34
million. Revenue for the full year 2011 is expected to
be in the range of $115 million to $117
million. Revenue derived from the sale of LipoSonix products
in the fourth quarter of 2011 is anticipated to be negligible as
the Company ramps up production of the second generation LipoSonix
system.
- 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
nine months ended September 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 for the fourth quarter
is expected to be slightly better than breakeven due to operating
costs of the LipoSonix facility in Bothell, Washington prior to commercialization
of the second generation LipoSonix system in the first quarter of
2012. Non-GAAP EBITDA excludes non-cash amortization charges,
non-cash stock based compensation charges, and acquisition related
adjustments related to the acquisition of LipoSonix. The company
has generated positive non-GAAP EBITDA in each quarter of 2011.
Non-GAAP EBITDA for the nine months ended September 30, 2011 was $6.2 million.
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, November 1, 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 877-941-0843 for domestic participants and
480-629-9819 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®, LipoSonix®, 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. LipoSonix system uses advanced
high–intensity focused ultrasound (HIFU) technology to permanently
destroy targeted fat just beneath the skin in the treatment areas
of the abdomen and flanks as a noninvasive, nonsurgical approach to
aesthetic waist circumference reduction. 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
and our intent to introduce the second generation LipoSonix system.
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, including the LipoSonix
system, 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
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
$27,411
|
|
$24,851
|
|
$82,816
|
|
$80,866
|
|
Cost of revenue
|
9,519
|
|
9,110
|
|
28,300
|
|
29,610
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
17,892
|
|
15,741
|
|
54,516
|
|
51,256
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Sales and
marketing
|
10,784
|
|
10,170
|
|
34,517
|
|
31,487
|
|
Research and
development
|
3,665
|
|
4,135
|
|
10,878
|
|
12,530
|
|
General and
administrative
|
4,275
|
|
3,290
|
|
11,125
|
|
11,002
|
|
Legal settlement
gain
|
-
|
|
-
|
|
-
|
|
(2,213)
|
|
|
|
|
|
|
|
|
|
|
Total operating
expenses
|
18,724
|
|
17,595
|
|
56,520
|
|
52,806
|
|
|
|
|
|
|
|
|
|
|
Loss from
operations
|
(832)
|
|
(1,854)
|
|
(2,004)
|
|
(1,550)
|
|
Interest income
|
19
|
|
27
|
|
52
|
|
45
|
|
Interest
expense
|
(16)
|
|
(38)
|
|
(90)
|
|
(156)
|
|
Other income and expense,
net
|
(306)
|
|
451
|
|
(188)
|
|
134
|
|
|
|
|
|
|
|
|
|
|
Loss before income
taxes
|
(1,135)
|
|
(1,414)
|
|
(2,230)
|
|
(1,527)
|
|
Provision for income
taxes
|
10
|
|
(8)
|
|
146
|
|
303
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
($1,145)
|
|
($1,406)
|
|
($2,376)
|
|
($1,830)
|
|
|
|
|
|
|
|
|
|
|
Net loss per share — basic
and diluted
|
($0.02)
|
|
($0.02)
|
|
($0.04)
|
|
($0.03)
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares
outstanding used in calculating net loss
|
|
|
|
|
|
|
|
|
per share:
|
|
|
|
|
|
|
|
|
Basic and
diluted
|
60,785,015
|
|
59,519,116
|
|
60,443,429
|
|
58,663,816
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
|
GAAP Gross margin
|
$17,892
|
|
$15,741
|
|
$54,516
|
|
$51,256
|
|
GAAP gross margin as % of
sales
|
65%
|
|
63%
|
|
66%
|
|
63%
|
|
Non-GAAP adjustments to gross
margin:
|
|
|
|
|
|
|
|
|
GAAP Gross margin
|
$17,892
|
|
$15,741
|
|
$54,516
|
|
$51,256
|
|
Amortization and other non-cash
acquisition related charges
|
844
|
|
940
|
|
2,533
|
|
2,942
|
|
Stock-based
compensation
|
105
|
|
66
|
|
269
|
|
208
|
|
Non-GAAP gross margin
|
$18,841
|
|
$16,747
|
|
$57,318
|
|
$54,406
|
|
Non-GAAP gross margin as % of
sales
|
69%
|
|
67%
|
|
69%
|
|
67%
|
|
|
|
|
|
|
|
|
|
|
GAAP loss from
operations
|
($832)
|
|
($1,854)
|
|
($2,004)
|
|
($1,550)
|
|
Non-GAAP adjustments to net loss
from operations:
|
|
|
|
|
|
|
|
|
Amortization and other non-cash
acquisition related charges
|
734
|
|
1,291
|
|
2,452
|
|
3,942
|
|
Severance expenses
|
—
|
|
-
|
|
—
|
|
55
|
|
Acquisition-related
expenses
|
1,115
|
|
15
|
|
1,235
|
|
978
|
|
Stock-based
compensation
|
800
|
|
603
|
|
2,281
|
|
1,923
|
|
Non-GAAP income from
operations
|
$1,817
|
|
$55
|
|
$3,964
|
|
$5,348
|
|
Depreciation expenses
|
733
|
|
747
|
|
2,278
|
|
2,145
|
|
Non-GAAP EBITDA
|
$2,550
|
|
$802
|
|
$6,242
|
|
$7,493
|
|
|
|
|
|
|
|
|
|
|
GAAP net loss
|
($1,145)
|
|
($1,406)
|
|
($2,376)
|
|
($1,830)
|
|
Non-GAAP adjustments to net
loss:
|
|
|
|
|
|
|
|
|
Amortization and other non-cash
acquisition related charges
|
734
|
|
1,291
|
|
2,452
|
|
3,942
|
|
Severance expenses
|
—
|
|
-
|
|
—
|
|
55
|
|
Acquisition-related
expenses
|
1,115
|
|
15
|
|
1,235
|
|
978
|
|
Stock-based
compensation
|
800
|
|
603
|
|
2,281
|
|
1,923
|
|
Non-GAAP net income
|
$1,504
|
|
$503
|
|
$3,592
|
|
$5,068
|
|
|
|
|
|
|
|
|
|
|
GAAP basic net loss per
share
|
($0.02)
|
|
($0.02)
|
|
($0.04)
|
|
($0.03)
|
|
Non-GAAP adjustments to basic
loss per share:
|
|
|
|
|
|
|
|
|
Amortization and other non-cash
acquisition related charges
|
$0.01
|
|
$0.02
|
|
$0.04
|
|
$0.07
|
|
Severance expenses
|
$0.00
|
|
$0.00
|
|
$0.00
|
|
$0.00
|
|
Acquisition-related
expenses
|
$0.02
|
|
$0.00
|
|
$0.02
|
|
$0.02
|
|
Stock-based
compensation
|
$0.01
|
|
$0.01
|
|
$0.04
|
|
$0.03
|
|
Non-GAAP basic net income per
share
|
$0.02
|
|
$0.01
|
|
$0.06
|
|
$0.09
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted net income per
share
|
$0.02
|
|
$0.01
|
|
$0.06
|
|
$0.08
|
|
|
|
|
|
|
|
|
|
|
GAAP weighted average shares
outstanding used in calculating basic net loss per share
|
60,785,015
|
|
59,519,116
|
|
60,443,429
|
|
58,663,816
|
|
|
|
|
|
|
|
|
|
|
GAAP weighted average shares
outstanding used in calculating diluted net loss per
share
|
60,785,015
|
|
59,519,116
|
|
60,443,429
|
|
58,663,816
|
|
Adjustments for dilutive
potential common stock
|
2,389,684
|
|
1,701,112
|
|
3,669,537
|
|
1,926,538
|
|
Weighted average shares
outstanding used in calculating non-GAAP diluted net income per
share
|
63,174,699
|
|
61,220,228
|
|
64,112,966
|
|
60,590,354
|
|
|
|
|
|
|
|
|
|
Solta
Medical, Inc.
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(in
thousands of dollars, except share and per share
data)
|
|
(unaudited)
|
|
|
|
|
|
|
|
September
30,
|
|
December
31,
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
ASSETS
|
|
Current assets:
|
|
|
|
|
Cash and cash
equivalents
|
$33,164
|
|
$36,898
|
|
Accounts
receivable
|
14,985
|
|
12,426
|
|
Inventories
|
15,061
|
|
10,549
|
|
Prepaid expenses and other
current assets
|
8,929
|
|
5,906
|
|
Total current
assets
|
72,139
|
|
65,779
|
|
Property and equipment,
net
|
5,030
|
|
6,227
|
|
Purchased intangible
assets, net
|
33,504
|
|
36,809
|
|
Goodwill
|
49,481
|
|
49,481
|
|
Other assets
|
587
|
|
249
|
|
|
|
|
|
|
Total assets
|
$160,741
|
|
$158,545
|
|
|
|
|
|
|
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
|
Liabilities:
|
|
|
|
|
Accounts
payable
|
$5,632
|
|
$6,358
|
|
Accrued
liabilities
|
13,346
|
|
12,030
|
|
Current portion of
deferred revenue
|
4,879
|
|
3,428
|
|
Short-term
borrowings
|
8,489
|
|
9,528
|
|
Customer
deposits
|
566
|
|
441
|
|
Total current
liabilities
|
32,912
|
|
31,785
|
|
Deferred revenue, net of
current portion
|
806
|
|
969
|
|
Term loan, net of current
portion
|
—
|
|
98
|
|
Non-current tax
liabilities
|
3,418
|
|
3,372
|
|
Other
liabilities
|
117
|
|
177
|
|
Total
liabilities
|
37,253
|
|
36,401
|
|
|
|
|
|
|
Stockholders’
equity:
|
|
|
|
|
Common stock, $0.001 par
value:
|
|
|
|
|
100,000,000 shares
authorized
|
|
|
|
|
60,815,179,and 59,728,410
shares issued and outstanding at September 30, 2011 and December
31, 2010
|
61
|
|
60
|
|
Additional paid-in
capital
|
196,917
|
|
193,198
|
|
Accumulated
deficit
|
(73,490)
|
|
(71,114)
|
|
Total stockholders’
equity
|
123,488
|
|
122,144
|
|
|
|
|
|
|
Total liabilities and
stockholders’ equity
|
$160,741
|
|
$158,545
|
|
|
|
|
|
SOURCE Solta Medical, Inc.