EICU Visicu (MM)

VISICU, Inc. (Nasdaq:EICU), a healthcare information technology and clinical solutions company focused on transforming the delivery of care to the highest acuity patients in the hospital, today announced financial results for the second quarter of 2007. The company reported significantly higher revenue and operating income for the second quarter over the same quarter from the prior year: Revenue for the second quarter was $9.1 million, a 20% increase over the same quarter last year. Adjusted operating income for the second quarter increased to $2.5 million, resulting in a 27% adjusted operating margin, from adjusted operating income of $1.8 million and an adjusted operating margin of 24% for the same quarter last year. Adjusted operating income and adjusted operating margin exclude non-cash stock-based compensation expense included in the GAAP results. GAAP operating income for the second quarter increased to $1.7 million, resulting in a 19% operating margin, from GAAP operating income of $1.1 million and operating margin of 15% for the same quarter last year. GAAP operating income includes non-cash stock-based compensation expense of $741,000 and $658,000 in the second quarter of 2007 and 2006, respectively. Net income for the second quarter of 2007 increased to $2.1 million, or $0.06 per diluted share, from $1.2 million, or $0.04 per diluted share for the same quarter last year. Total revenue backlog at the end of the second quarter was $63.8 million. �We are pleased with our strong operating results and financial position, and we are focused on investing resources to execute on sales and marketing initiatives to accelerate market adoption,� said Frank Sample, Chairman and CEO of VISICU. �We have yet to reach the tipping point in the market and are in the midst of transitioning from early adopters to the early majority. This has lengthened our sales cycle and impacted year to date new account sales activity. Although our backlog has decreased, we are experiencing increased market interest for our solution and our sales pipeline is expanding. As a result, I am very optimistic about the mid to long term growth prospects for the business.� Conference Call Information A conference call and audio webcast will be held today, Thursday, July, 26, 2007 at 4:30 p.m. EST. Participants can access the call by dialing 719-457-2651 or access the audio webcast directly at http://investors.visicu.com/eventdetail.cfm?eventid=42218 or through the company's website at www.VISICU.com. A replay of the call will be available approximately three hours after the call has ended and will be available until 11:59 p.m. (EDT) on Thursday, August 2, 2007. To access the replay, dial 719-457-0820 and enter the conference passcode number: 8623384. A replay will also be archived online on the company's corporate website at www.VISICU.com. About VISICU, Inc. VISICU, Inc. is a healthcare information technology and clinical solutions company transforming the delivery of critical care through its eICU Program. The eICU Program restructures the practice of critical care by using remote monitoring technology to allow systems to centralize scarce critical care trained staff to improve coverage and to allow intervention to prevent or manage crises. For more information, visit www.VISICU.com. VISICU� and eICU� are registered trademarks of VISICU, Inc. All rights reserved. visicu-f Safe Harbor Statement This release contains forward-looking statements that are made pursuant to the provisions of Section 21E of the Securities and Exchange Act of 1934, as amended. These forward-looking statements involve a number of risks and uncertainties. Investors are cautioned that statements in this press release that are not strictly historical statements constitute forward-looking statements. It is important to note that the company�s performance, and actual results, financial condition or business could differ materially from those expressed in the forward-looking statements. The words �outlook�, �positions us�, �guidance�, �expects�, �estimates�, �intends�, �plans�, �projects�, �anticipates�, �believes� or the negative of these words, variations thereof or similar expressions are intended to identify such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to: market acceptance of the company�s principal product offering and any new product releases, the performance and reliability of our products and services, the company�s ability to attract and retain new customers, renewal rates of the company�s existing customers, financial and budget constraints of hospitals, changes in the company�s or competitors� pricing practices, quarterly operating results may vary, stock price may be volatile, changes in the healthcare industry, the introduction or availability of competing products or services and other competitive factors, changes in the government regulation of our products and services, and the possibility of unfavorable outcomes in regulatory and legal proceedings relating to VISICU's patent that are pending currently or that could be initiated in the future. Additional discussion of these and other factors affecting the company�s business is contained in the company�s periodic filings with the Securities and Exchange Commission. The company undertakes no obligation to update forward-looking statements to reflect changed assumptions the occurrence of unanticipated events or changes in future operating results, financial condition or business over time. Use of Non-GAAP Financial Measures Adjusted operating income (loss) and adjusted operating margins as described in this release and in the attached financial statement tables are not measures of financial performance under generally accepted accounting principles (GAAP) and should not be considered a substitute for or superior to GAAP operating income (loss) and operating margins. Management believes the non-GAAP results provide useful information to both management and investors by excluding certain expenses that may not be indicative of our core results and provides for consistency in financial reporting. Management provides these non-GAAP financial measures because it believes they provide greater transparency with respect to supplemental information used by management in its financial and operational decision making. Specifically, these non-GAAP measures are provided to enhance investor's overall understanding of the company�s current financial performance and the company�s future prospects. For the reconciliation of adjusted operating income (loss) and operating margins to GAAP, please refer to the information included in the attached tables of this press release. Visicu, Inc. Condensed Statements of Operations (In thousands, except per share data) (Unaudited) � Three Months Ended Six Months Ended June 30, June 30, � 2006 � � � 2007 � � � 2006 � � � 2007 � � Revenues $ 7,529 $ 9,054 $ 14,198 $ 17,794 � Direct cost of revenues � 1,438 � � � 1,717 � � � 2,841 � � � 3,363 � � Gross profit 6,091 7,337 11,357 14,431 � Operating expenses � 4,975 � � � 5,601 � � � 9,789 � � � 11,283 � � Income from operations 1,116 1,736 1,568 3,148 � Interest income 1,185 1,667 1,325 3,299 Interest expense � (2 ) � � (1 ) � � (4 ) � � (7 ) � Income before income taxes 2,299 3,402 2,889 6,440 � Income tax expense � 1,056 � � � 1,271 � � � 1,332 � � � 2,336 � � Net income $ 1,243 � � $ 2,131 � � $ 1,557 � � $ 4,104 � � Net income per share: Basic $ 0.04 $ 0.07 $ 0.09 $ 0.13 Diluted $ 0.04 $ 0.06 $ 0.05 $ 0.12 � Weighted-average shares outstanding used in computing per share amounts: Basic 29,080 32,516 17,305 32,502 Diluted 33,844 34,391 30,799 34,541 Visicu, Inc. Reconciliation Between GAAP and Adjusted Operating Income (In thousands) (Unaudited) � Three Months Ended June 30, � 2006 � � 2007 � Income from operations $ 1,116 $ 1,736 � Non-cash stock-based compensation � 658 � � 741 � Adjusted income from operations $ 1,774 � $ 2,477 � � � Visicu, Inc. Reconciliation Between GAAP and Adjusted Operating Income (In thousands) (Unaudited) � Six Months Ended June 30, � 2006 � � 2007 � Income from operations $ 1,568 $ 3,148 � Non-cash stock-based compensation � 1,229 � � 1,426 � Adjusted income from operations $ 2,797 � $ 4,574 Visicu, Inc. Condensed Balance Sheets (In thousands) � December 31, June 30, 2006 � 2007 (Unaudited) Assets Current assets: Cash and cash equivalents $ 74,188 $ 102,873 Marketable securities 46,047 26,900 Accounts receivable 11,465 5,789 Prepaid expenses and other current assets 1,686 1,182 Deferred tax assets � 7,915 � � 6,644 Total current assets 141,301 143,388 � Property and equipment, net 1,631 1,561 Deferred contract costs 4,477 4,406 Marketable securities 2,960 - Deferred tax assets 6,140 6,073 Other assets � 503 � � 438 � Total assets $ 157,012 � $ 155,866 � � Liabilities and stockholders� equity Current liabilities: Accounts payable and accrued expenses $ 1,244 $ 849 Accrued compensation and related costs 1,581 1,374 Deferred revenue 30,290 26,616 Other current liabilities � 27 � � 27 Total current liabilities 33,142 28,866 � Other long-term liabilities 468 369 Deferred revenue � 19,074 � � 14,944 Total liabilities 52,684 44,179 Stockholders� equity � 104,328 � � 111,687 Total liabilities and stockholders� equity $ 157,012 � $ 155,866 Visicu, Inc. Condensed Statements of Cash Flows (In thousands) (Unaudited) � Six Months Ended June 30, 2006 � 2007 � Net income $ 1,557 $ 4,104 Adjustments to reconcile net income to net cash provided by operating activities 2,336 1,879 Changes in operating assets and liabilities � 1,495 � � � (864 ) Net cash provided by operating activities 5,388 5,119 � Purchases of property and equipment (245 ) (354 ) Maturities (purchases) of marketable securities (19,014 ) 22,107 Other investing activity changes � (7 ) � � (179 ) Net cash provided by (used in) investing activities (19,266 ) 21,574 � Proceeds from issuance of common stock, net of costs 100,720 - Exercise of options to purchase common stock 792 551 Excess tax benefit from stock-based compensation 113 1,453 Other financing activity changes � (12 ) � � (12 ) Net cash provided by financing activities � 101,613 � � � 1,992 � Net increase in cash and cash equivalents 87,735 28,685 Cash and cash equivalents at beginning of period � 11,379 � � � 74,188 � Cash and cash equivalents at end of period $ 99,114 � � $ 102,873 �