LITTLE FALLS, N.J.,
Dec. 9, 2010 /PRNewswire-FirstCall/
-- CANTEL MEDICAL CORP. (NYSE: CMN) reported net income of
$4,975,000, or $0.29 per diluted share, on a 1% increase in
sales to a record $71,993,000 for the
first quarter ended October 31, 2010.
This compares with net income of $6,168,000, or $0.37 per diluted share, on sales of $70,995,000 for the first quarter ended
October 31, 2009.
According to Andrew Krakauer,
Cantel's President and CEO, "I am pleased with the performance of
Cantel this quarter. It is important to note that in the
corresponding quarter last year, sales were favorably impacted by
over $4 million and EPS was higher by
$0.10 due to atypically high face
mask shipments driven by the H1N1 flu outbreak. Therefore, this
quarter we actually increased normalized net income despite
substantial incremental investments in research and development, as
well as in sales and marketing programs. Further, we achieved
respectable core sales growth in our three largest segments."
Krakauer added, "Our Endoscope Reprocessing business had
especially stellar performance as sales grew by over 33%, driven by
strong shipments of our two newest reprocessors, the Advantage®
Plus and the DSD Edge, as well as disinfectants and sterilants,
parts and service. Our Healthcare Disposables segment had one of
its strongest quarterly performances without any sales derived from
H1N1 flu preparedness. We were also pleased to have acquired
Gambro's United States water
business on October 6, which added to
the sales growth in our Water Purification and Filtration segment.
Cantel's overall growth continues to attest to our successful
strategy to invest in new product development, sales and marketing,
and acquisitions."
The Company also reported that its balance sheet at October 31, 2010 included current assets of
$92,730,000, including cash of
$15,954,000, a current ratio of
1.45:1, gross debt of $33,000,000 and
stockholders' equity of $214,209,000.
Krakauer stated, "We continue to maintain a strong balance sheet
and generate substantial cash flow and EBITDAS. Our net debt
position of $17,046,000 at the end of
this quarter gives us a favorable net debt to EBITDAS ratio of
.38:1. As a result of the Company's strong cash flow generation,
our net debt increased by only $2,151,000 over the past year, despite funding
approximately $23 million for two
acquisitions."
Cantel Medical Corp. is a leading provider of infection
prevention and control products in the healthcare market. Our
products include water purification equipment, sterilants,
disinfectants and cleaners, specialized medical device reprocessing
systems for endoscopy and renal dialysis, disposable infection
control products primarily for the dental industry, dialysate
concentrates and other dialysis supplies, 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 first quarter ended October 31,
2010 on Thursday, December 9,
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 December 9, 2010 at
2:00 PM through midnight on
December 16, 2010 by dialing
1-877-660-6853 and using passcode #286 and conference ID
#362463.
The call will be simultaneously broadcast live over the Internet
on vcall.com at
http://www.investorcalendar.com/IC/CEPage.asp?ID=162707. 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.
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CANTEL
MEDICAL CORP.
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CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
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(In
thousands, except per share data)
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(unaudited)
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Three Months
Ended
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October
31,
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2010
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2009
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Net sales
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$
71,993
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$
70,995
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Cost of sales
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43,801
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41,537
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Gross profit
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28,192
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29,458
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Expenses:
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Selling
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9,631
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8,524
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General and
administrative
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9,118
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9,305
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Research and
development
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1,629
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1,265
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Total operating
expenses
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20,378
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19,094
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Income before interest and
income taxes
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7,814
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10,364
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Interest expense
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241
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387
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Interest income
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(19)
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(8)
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Income before income
taxes
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7,592
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9,985
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Income taxes
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2,617
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3,817
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Net income
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$
4,975
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$
6,168
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Earnings per common share -
diluted
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$
0.29
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$
0.37
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Dividends per common
share
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$
0.06
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$
-
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Weighted average shares -
diluted
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16,993
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16,769
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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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October
31,
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July
31,
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2010
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2010
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Assets
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Current
assets
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$
92,730
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$
94,731
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Property and
equipment, net
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34,814
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35,243
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Intangible assets,
net
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40,399
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32,717
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Goodwill
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128,555
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116,783
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Other
assets
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1,350
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1,191
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$
297,848
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$
280,665
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Liabilities and stockholders'
equity
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Current portion of
long-term debt
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$
33,000
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$
10,000
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Other current
liabilities
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30,832
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30,984
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Long-term
debt
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-
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11,000
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Other long-term
liabilities
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19,807
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19,276
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Stockholders'
equity
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214,209
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209,405
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$
297,848
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$
280,665
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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 months ended October 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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October
31,
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2010
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2009
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Net income
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$
4,975
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$
6,168
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Income taxes
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2,617
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3,817
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Interest expense
|
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241
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|
387
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Interest income
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(19)
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(8)
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Depreciation
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1,628
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1,564
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Amortization
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1,319
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1,278
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Gain on disposal of fixed
assets
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(11)
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-
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EBITDA
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10,750
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13,206
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Stock-based compensation
expense
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765
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789
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EBITDAS
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$ 11,515
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$ 13,995
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EBITDAS is a measure of
the Company's performance that is
not required by, or presented in accordance with, Generally
Accepted Accounting Principles ("GAAP"). EBITDAS is a non-GAAP
financial measure defined by the Company as income before interest,
taxes, depreciation, amortization and stock-based compensation
expense. The Company believes EBITDAS is an important valuation
measurement for management and investors given the increasing
effect that non-cash charges, such as stock-based compensation,
amortization related to acquisitions and depreciation of capital
equipment, has on the Company's net income. In particular,
acquisitions have historically resulted in significant increases in
amortization of intangible assets that reduced the Company's net
income. Additionally, the Company regards EBITDAS as a useful
measure of operating performance and cash flow before the effect of
interest expense and complements operating income, net income and
other GAAP financial performance measures. Generally, a non-GAAP
financial measure is a numerical measure of a Company's
performance, financial position or cash flow that either excludes
or includes amounts that are not normally excluded or included in
the most directly comparable measure calculated and presented in
accordance with GAAP. This measure, however, should be considered
in addition to, and not as a substitute or superior to, net income,
cash flows, or other measures of financial performance prepared in
accordance with GAAP.
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SOURCE Cantel Medical Corp.