LITTLE FALLS, N.J.,
Oct. 13 /PRNewswire-FirstCall/ --
CANTEL MEDICAL CORP. (NYSE: CMN) reported an 8% increase in
net income to $4,623,000, or
$0.27 per diluted share, on a 5%
increase in sales to $69,811,000 for
the fourth quarter ended July 31,
2010. This compares with net income of $4,279,000, or $0.26 per diluted share, on sales of $66,793,000 for the fourth quarter ended
July 31, 2009.
For the fiscal year ended July 31,
2010, the Company reported a 28% increase in net income to
$19,941,000, or $1.18 per diluted share, on a 5% increase in
sales to $273,952,000. This compares
with net income of $15,569,000, or
$0.94 per diluted share, on sales of
$260,050,000 for the fiscal year
ended July 31, 2009. Additionally,
EBITDAS for the fiscal year increased 13% from $42,059,000 to $47,471,000.
Andrew Krakauer, Cantel's
President and CEO stated, "We are pleased to have delivered a solid
quarter and strong double digit earnings growth for the year.
In the fourth quarter, sales growth was particularly robust
in Endoscope Reprocessing and Water Purification where revenue grew
by 34% and 16%, respectively. This is a confirmation of the success
of the sales and marketing investments we made in these businesses.
Our Healthcare Disposables business also performed very well this
quarter, and the base business continued to grow in excess of the
dental market. It is important to note that even with the
strong Crosstex performance, the reported segment sales are
comparatively lower due to the abnormally high fourth quarter
results in fiscal year 2009 from H1N1 flu sales of face masks."
Krakauer continued, "The diversity of Cantel's product portfolio
within Infection Prevention and Control and our focus on growing
consumables and service revenue, supported by a large base of
installed equipment, have greatly benefited our consolidated
results during the quarter and for the full 2010 fiscal year.
Excluding the Dialysis segment, where sales of low margin dialysate
concentrate declined as expected, revenue growth for the fiscal
year was 13%. All of our reporting segments except Dialysis, showed
commendable earnings growth resulting from a favorable sales mix,
the implementation of price increases, success from new product
introductions, benefits derived from sales and marketing
investments, and ongoing cost improvement programs. Additionally,
our earnings were positively impacted by reduced interest
expenses.
During fiscal year 2011, we plan to significantly increase our
R&D spending and new product development efforts, particularly
in the area of chemistry development. We will continue to leverage
our significant investments in sales and marketing (including our
alternative channel programs) and aggressively pursue strategic
acquisitions to further improve our revenue growth and operating
margins. Last week, we were pleased to report the key strategic
acquisition of Gambro's United
States water business. This adds further manufacturing
scale, product diversity, and an expanded U.S. customer base to our
Mar Cor Purification subsidiary. We remain active in our search
for, and review of, acquisition targets, and we expect this
activity to remain one of the key growth vehicles for Cantel
Medical in the future."
The Company also reported that its balance sheet at July 31, 2010 included current assets of
$94,731,000, including cash of
$22,612,000, a current ratio of
2.3:1, gross debt of $21,000,000,
stockholders' equity of $209,405,000
and a ratio of gross debt to EBITDAS of 0.4:1. Krakauer stated,
"The Company has a strong balance sheet and continues to generate
significant cash flow. Our cash provided by operating activities
was $11,582,000 for the fourth
quarter and $29,033,000 for the full
year. We began fiscal 2010 with net debt of $19,932,000, and ended in a positive net cash
position of $1,612,000.
Following the recently announced Gambro acquisition, gross
debt increased to $33,000,000, and
our gross debt to EBITDAS ratio is still a favorable 0.7:1. Cantel
remains in an excellent position to fund acquisitions and other
investment activities."
Cantel Medical Corp. is a leading provider of infection
prevention and control products in the healthcare market. Our
products include specialized medical device reprocessing systems
for renal dialysis and endoscopy, dialysate concentrates and other
dialysis supplies, disposable infection control products primarily
for the dental industry, water purification equipment, sterilants,
disinfectants and cleaners, hollow fiber membrane filtration and
separation products for medical and non-medical applications, and
specialty packaging for infectious and biological specimens. We
also provide technical maintenance for our products and offer
compliance training services for the transport of infectious and
biological specimens.
The Company will hold a conference call to discuss the results
for the fourth quarter ended July 31,
2010 on Wednesday, October 13,
2010 at 11:00 AM Eastern time.
To participate in the conference call, dial 1-877-407-8035
approximately 5 to 10 minutes before the beginning of the call. If
you are unable to participate, a digital replay of the call will be
available from Wednesday, October 13,
2010 at 2:00 PM through
midnight on October 20, 2010 by
dialing 1-877-660-6853 and using passcode #286 and conference ID
#358375.
The call will be simultaneously broadcast live over the Internet
on vcall.com at
http://www.investorcalendar.com/IC/CEPage.asp?ID=161963. A replay
of the webcast will be available on Vcall for 30 days.
For further information, visit the Cantel website at
www.cantelmedical.com.
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements involve a number of risks and uncertainties,
including, without limitation, the risks detailed in Cantel's
filings and reports with the Securities and Exchange Commission.
Such forward-looking statements are only predictions, and actual
events or results may differ materially from those projected or
anticipated.
-Financial Tables to Follow-
CANTEL MEDICAL
CORP.
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CONDENSED CONSOLIDATED
STATEMENTS OF INCOME
|
|
(In thousands, except per share
data)
|
|
(unaudited)
|
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|
|
|
|
|
|
|
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Three Months Ended
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Twelve Months Ended
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July 31,
|
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July 31,
|
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|
2010
|
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2009
|
|
2010
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|
2009
|
|
|
|
|
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Net sales
|
$ 69,811
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$ 66,793
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$ 273,952
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$ 260,050
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales
|
42,115
|
|
40,071
|
|
162,981
|
|
160,571
|
|
|
|
|
|
|
|
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Gross profit
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27,696
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26,722
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110,971
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99,479
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Expenses:
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Selling
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9,509
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8,072
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36,092
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30,398
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General and
administrative
|
9,319
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9,831
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37,045
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|
36,998
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Research and
development
|
1,405
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|
1,323
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|
5,169
|
|
4,632
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|
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Total operating
expenses
|
20,233
|
|
19,226
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|
78,306
|
|
72,028
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|
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|
|
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Income before interest and
income taxes
|
7,463
|
|
7,496
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|
32,665
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|
27,451
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|
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Interest expense
|
210
|
|
626
|
|
1,169
|
|
2,639
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Interest income
|
(24)
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|
(12)
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(59)
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|
(144)
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Income before income
taxes
|
7,277
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|
6,882
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|
31,555
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24,956
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Income taxes
|
2,654
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2,603
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11,614
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9,387
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Net income
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$ 4,623
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$ 4,279
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$ 19,941
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$ 15,569
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Earnings per common share -
diluted
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$ 0.27
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$ 0.26
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$
1.18
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$
0.94
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Dividends per common
share
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$ 0.05
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$
-
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$
0.10
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$
-
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Weighted average shares -
diluted
|
16,997
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16,721
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16,968
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16,576
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CANTEL MEDICAL
CORP.
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CONDENSED CONSOLIDATED BALANCE
SHEETS
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(In thousands)
|
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(unaudited)
|
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|
|
|
|
|
|
|
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July 31,
|
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July 31,
|
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2010
|
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2009
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Assets
|
|
|
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Current
assets
|
$ 94,731
|
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$ 88,910
|
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Property and
equipment, net
|
35,243
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|
35,968
|
|
Intangible assets,
net
|
32,717
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|
37,042
|
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Goodwill
|
116,783
|
|
114,995
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Other
assets
|
1,191
|
|
956
|
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$280,665
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$277,871
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|
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Liabilities and stockholders'
equity
|
|
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Current portion of
long-term debt
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$ 10,000
|
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$ 10,000
|
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Other current
liabilities
|
30,984
|
|
29,113
|
|
Long-term
debt
|
11,000
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|
33,300
|
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Other long-term
liabilities
|
19,276
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|
18,342
|
|
Stockholders'
equity
|
209,405
|
|
187,116
|
|
|
$280,665
|
|
$277,871
|
|
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SUPPLEMENTARY
INFORMATION
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Reconciliation of Earnings
Before Interest, Taxes, Depreciation, Amortization and
Stock-Based
|
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Compensation Expense
("EBITDAS")
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The reconciliation of EBITDAS
with net income for the three and twelve months ended July 31, 2010
and 2009,
|
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respectively, is as follows (in
thousands):
|
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Three Months Ended
|
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Twelve Months Ended
|
|
|
|
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July 31,
|
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July 31,
|
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2010
|
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2009
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2010
|
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2009
|
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Net income
|
$
4,623
|
|
$
4,279
|
|
$ 19,941
|
|
$ 15,569
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
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Income taxes
|
2,654
|
|
2,603
|
|
11,614
|
|
9,387
|
|
|
|
|
|
Interest expense
|
210
|
|
626
|
|
1,169
|
|
2,639
|
|
|
|
|
|
Interest income
|
(24)
|
|
(12)
|
|
(59)
|
|
(144)
|
|
|
|
|
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Depreciation
|
1,612
|
|
1,580
|
|
6,333
|
|
6,217
|
|
|
|
|
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Amortization
|
1,263
|
|
1,282
|
|
5,105
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|
5,152
|
|
|
|
|
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Loss on disposal of fixed
assets
|
14
|
|
30
|
|
238
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|
52
|
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EBITDA
|
10,352
|
|
10,388
|
|
44,341
|
|
38,872
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|
|
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|
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Stock-based compensation
expense
|
860
|
|
1,358
|
|
3,130
|
|
3,187
|
|
|
|
|
|
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|
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|
|
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EBITDAS
|
$ 11,212
|
|
$ 11,746
|
|
$ 47,471
|
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$ 42,059
|
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EBITDAS is a measure of the
Company's performance that is not required by, or presented in
accordance with,
|
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Generally Accepted Accounting
Principles ("GAAP"). EBITDAS is a non-GAAP financial measure
defined by the
|
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Company as income before
interest, taxes, depreciation, amortization and stock-based
compensation expense.
|
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The Company believes EBITDAS is
an important valuation measurement for management and investors
given
|
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the increasing effect that
non-cash charges, such as stock-based compensation, amortization
related to acquisitions
|
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and depreciation of capital
equipment, has on the Company's net income. In particular,
acquisitions have historically
|
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resulted in significant
increases in amortization of intangible assets that reduced the
Company's net income.
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Additionally, the Company
regards EBITDAS as a useful measure of operating performance and
cash flow before
|
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the effect of interest expense
and complements operating income, net income and other GAAP
financial
|
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performance measures. Generally,
a non-GAAP financial measure is a numerical measure of a
Company's
|
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performance, financial position
or cash flow that either excludes or includes amounts that are not
normally excluded
|
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or included in the most directly
comparable measure calculated and presented in accordance with
GAAP.
|
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This measure, however, should be
considered in addition to, and not as a substitute or superior to,
net income,
|
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cash flows, or other measures of
financial performance prepared in accordance with GAAP.
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SOURCE Cantel Medical Corp.
Copyright . 13 PR Newswire