Cantel Medical Reports EPS of $0.35 vs. $0.23 for First Quarter
Ended October 31, 2012
LITTLE FALLS, N.J.,
Dec. 6, 2012 /PRNewswire/
-- CANTEL MEDICAL CORP. (NYSE:CMN) reported a 54%
increase in net income to $9,576,000,
or $0.35 per diluted share, on a 7%
increase in sales to a record $99,681,000 for the first quarter ended
October 31, 2012. This compares with
net income of $6,220,000, or
$0.23 per diluted share, on sales of
$93,262,000 for the first quarter
ended October 31, 2011.
Andrew Krakauer, Cantel's
President and CEO stated, "We are pleased to have delivered another
strong financial performance this quarter. All three major business
segments contributed to the favorable results. As in the past four
quarters, much of our success resulted from the continued expansion
of our gross margins, which improved to 43.9%. This was three
percentage points better than in the same quarter last year and was
mostly driven by greater shipments of higher margin products."
Krakauer added, "Our Water Purification and Filtration segment
had an especially strong performance this quarter with organic
sales growth of 16%. Operating profits in the segment grew by 46%
due to greater sales of advanced technology higher margin products
and improved operating efficiencies driven by higher production
volumes. We also saw substantial operating leverage in our
Healthcare Disposables and Endoscopy businesses, primarily driven
by the sales of higher margin products. Operating profit in these
two segments grew by 37% and 33%, respectively. Additionally,
we also had some benefit from opportunistic sales in our
Therapeutic Filtration business and stringent expense control
across all units."
In November, we announced two important events which will
greatly benefit Cantel in the future. First was the acquisition of
SPS Medical Supply Corp., which now brings Cantel's sales in the
growing sterilization assurance market to over $30 million. It also significantly expanded the
presence of our Crosstex business into the hospital and alternative
care markets. Second, we announced the appointment of Jorgen B. Hansen as Cantel's Executive Vice
President and Chief Operating Officer. Jorgen brings a wealth of
senior executive management experience in the medical device and
healthcare industry to Cantel. He also has great knowledge of
international markets.
The Company also reported that its balance sheet at October 31, 2012 included current assets of
$133,211,000, including cash of
$27,866,000, a current ratio of
2.44:1, gross debt of $80,000,000 and
stockholders' equity of $284,597,000.
Krakauer stated, "We continue to maintain a strong balance sheet
and generate substantial cash flow and EBITDAS. When compared with
the same quarter last year, our EBITDAS grew by 34% to $20,998,000. We were able to reduce our net debt
position by approximately $7.7 million to
$52,134,000, during the quarter."
Cantel Medical Corp. (NYSE:CMN) 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 dental and GI endoscopy markets,
dialysate concentrates and other dialysis supplies, hollow fiber
membrane filtration and separation products for medical and
non-medical applications, and specialty packaging for the transport
and temperature regulation of infectious and biological
specimens.
The Company will hold a conference call to discuss the results
for the first quarter ended October 31,
2012 on Thursday, December 6,
2012 at 11:00 AM Eastern time.
To participate in the conference call, dial (877) 407-8033
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 Thursday, December 6,
2012 at 2:00 PM through
midnight on February 6, 2013 by
dialing (877) 660-6853 and using conference ID # 404890.
The call will be simultaneously broadcast live over the Internet
on vcall.com at
http://www.investorcalendar.com/IC/CEPage.asp?ID=170281. A
replay of the webcast will be available on Vcall for 90 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.
CANTEL
MEDICAL CORP.
|
CONDENSED CONSOLIDATED STATEMENTS OF
INCOME
|
(In
thousands, except per share data)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
|
October
31,
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
Net
sales
|
|
$
99,681
|
|
$
93,262
|
|
|
|
|
|
|
|
Cost of
sales
|
|
55,954
|
|
55,312
|
|
|
|
|
|
|
|
Gross
profit
|
|
43,727
|
|
37,950
|
|
|
|
|
|
|
|
Expenses:
|
|
|
|
|
|
Selling
|
|
13,413
|
|
12,923
|
|
General and administrative
|
|
12,048
|
|
12,102
|
|
Research and development
|
|
2,294
|
|
2,145
|
|
Total
operating expenses
|
|
27,755
|
|
27,170
|
|
|
|
|
|
|
|
Income
before interest and income taxes
|
|
15,972
|
|
10,780
|
|
|
|
|
|
|
|
Interest
expense
|
|
646
|
|
1,031
|
|
Interest
income
|
|
(13)
|
|
(30)
|
|
|
|
|
|
|
|
Income
before income taxes
|
|
15,339
|
|
9,779
|
|
|
|
|
|
|
|
Income
taxes
|
|
5,763
|
|
3,559
|
|
|
|
|
|
|
|
Net
income
|
|
$
9,576
|
|
$
6,220
|
|
|
|
|
|
|
|
Earnings
per common share - diluted
|
|
$
0.35
|
|
$
0.23
|
|
|
|
|
|
|
|
Dividends
per common share
|
|
$
0.06
|
|
$
0.05
|
|
|
|
|
|
|
|
Weighted
average shares - diluted
|
|
27,361
|
|
26,899
|
|
CANTEL
MEDICAL CORP.
|
CONDENSED CONSOLIDATED BALANCE
SHEETS
|
(In
thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
October
31,
|
|
July
31,
|
|
|
2012
|
|
2012
|
Assets
|
|
|
|
|
Current assets
|
|
$
133,211
|
|
$
133,892
|
Property and equipment,
net
|
|
42,403
|
|
43,022
|
Intangible assets,
net
|
|
69,096
|
|
71,311
|
Goodwill
|
|
183,703
|
|
183,655
|
Other assets
|
|
3,061
|
|
2,932
|
|
|
$
431,474
|
|
$
434,812
|
|
|
|
|
|
Liabilities and stockholders' equity
|
|
|
|
Current portion of long-term
debt
|
|
$
10,000
|
|
$
10,000
|
Other current
liabilities
|
|
44,615
|
|
45,141
|
Long-term debt
|
|
70,000
|
|
80,000
|
Other long-term
liabilities
|
|
22,262
|
|
23,735
|
Stockholders'
equity
|
|
284,597
|
|
275,936
|
|
|
$
431,474
|
|
$
434,812
|
|
|
|
|
|
SUPPLEMENTARY INFORMATION
|
|
|
|
|
|
|
|
|
|
Reconciliation of Earnings Before Interest, Taxes,
Depreciation, Amortization and Stock-Based
|
Compensation Expense ("EBITDAS")
|
|
|
|
|
|
|
|
|
|
The
reconciliation of EBITDAS with net income for the three months
ended October 31, 2012 and 2011, respectively, is as follows (in
thousands):
|
|
|
|
|
|
|
|
|
Three
Months Ended
|
|
|
October
31,
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
Net
income
|
|
$
9,576
|
|
$
6,220
|
|
|
|
|
|
Income
taxes
|
|
5,763
|
|
3,559
|
Interest
expense
|
|
646
|
|
1,031
|
Interest
income
|
|
(13)
|
|
(30)
|
Depreciation
|
|
1,760
|
|
1,677
|
Amortization
|
|
2,267
|
|
2,289
|
Loss on
disposal of fixed assets
|
|
41
|
|
3
|
|
|
|
|
|
EBITDA
|
|
20,040
|
|
14,749
|
|
|
|
|
|
Stock-based compensation expense
|
|
958
|
|
931
|
|
|
|
|
|
EBITDAS
|
|
$
20,998
|
|
$
15,680
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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.
|
|
|
|
|
|
|
|
SOURCE Cantel Medical Corp.