Posted on 02/25/2005 2:21:41 PM PST by MeneMeneTekelUpharsin
FY 2004 net revenues increase 28% over prior year to $126.6 million FY 2004 earnings approximate $9.9 million, or $0.22 per diluted share Releases Revenue and Earnings Forecasts for FY 2005
ALPHARETTA, Ga., Feb. 25 /PRNewswire-FirstCall/ -- Microtek Medical Holdings, Inc. (Nasdaq: MTMD - News), a leading manufacturer and marketer of infection control products, fluid control products and safety products to healthcare professionals, today announced results for the fourth quarter and year ended December 31, 2004. "We are increasingly proud of our performance this year, particularly the growth in our organic healthcare revenues, our improved operating profitability and the contributions from our recently acquired businesses," said Dan R. Lee, the Company's President and CEO. "Our sales and marketing infrastructure is in place and is delivering results. Our net revenues increased 28 percent year over year. Our income from operations, excluding the effect of disposition gains in each year, increased 25 percent year over year. Our cash flow from operations for 2004 was approximately $12 million, and we ended the year with cash and equivalents of $9 million and reduced debt by more than $3 million, net of financing our recent acquisitions."
Highlights from the fourth quarter and full year of 2004 include:
Fourth quarter net revenues increased 25.2 percent to $33.1 million, compared to the fourth quarter of 2003; Full year 2004 net revenues increased 28.3 percent over 2003 to $126.6 million; Organic healthcare revenues grew 5.8 percent in fourth quarter of 2004 over the prior year quarter and 10.7 percent for the full year; Net income for the fourth quarter was $4.3 million, or $0.10 per diluted share, including foreign currency exchange gains of $557 thousand, net of income taxes of $293 thousand, and non-cash deferred income tax benefits of $1.7 million;
Net income for the full year 2004 was $9.9 million, or $0.22 per diluted share, including the previously mentioned foreign currency exchange gains and non-cash deferred income tax benefits and gains on the sale of certain property and equipment in the third quarter of 2004 of $215 thousand.
Fourth Quarter and Full Year Results
Fourth quarter 2004 net revenues were $33.1 million, an increase of $6.7 million or 25.2 percent over the fourth quarter of 2003. The Company's healthcare revenues, including revenues attributable to recent acquisitions, totaled $31.5 million for the fourth quarter of 2004, an increase of 4.4 percent over the 2003 quarter. For the full year 2004, net revenues, including acquisitions, increased by 28.3 percent over 2003 to $126.6 million. Healthcare revenues, including acquisitions, increased 27.9 percent over 2003 to $119.2 million, compared to $93.1 million in 2003.
Mr. Lee explained, "During the 2004 quarter as compared to the 2003 quarter, the Company's domestic healthcare revenues grew 8 percent to $24.1 million as a result of a 7 percent increase in our domestic branded hospital revenues and a 9 percent increase in our domestic OEM revenues. The Plasco acquisition, continued growth in our CleanOp product sales and increased sales to private label customers were the primary contributing factors to this growth. The Company's international revenues for the 2004 quarter, including revenues from the acquisition of IMP earlier in the year, demonstrated an impressive 146 percent increase to $7.4 million. Excluding IMP revenues, international revenues for the fourth quarter of 2004 increased by 25 percent."
Mr. Lee continued, "For the full year, domestic healthcare revenues increased by $16.0 million, or 20 percent, as a result of 20 percent increases in both our domestic branded and OEM revenues. Excluding the impact of recent acquisitions, domestic healthcare revenues increased by 10 percent. On the international front, full year 2004 revenues increased over 2003 by $10 million or 75 percent, including $7.9 million in IMP revenues. Excluding IMP, international revenues posted a 16 percent increase to $15.5 million." Gross profit for the fourth quarter of 2004 was $13.3 million, or 40.0 percent of net revenues, versus $10.8 million, or 40.9 percent of net revenues, for the fourth quarter of 2003. For the full year, gross profit was $49.6 million, or 39.2 percent of net revenues, compared to $39.2 million or 39.7 percent of net revenues in 2003.
Selling, general and administrative ("SG&A") expenses for the fourth quarter of 2004 were $10.5 million, or 31.7 percent of net revenues, as compared to $8.7 million, or 32.8 percent of net revenues in the fourth quarter of 2003. For the full year 2004, SG&A expenses were $39.5 million, or 31.2 percent of net revenues, versus $31.3 million, or 31.7 percent, of net revenues in 2003. Income from operations for the fourth quarter and full year 2004 was $2.2 million and $8.4 million, respectively, as compared to $1.8 million in the fourth quarter of 2003 and $7.6 million for the full year 2003. Excluding gains on dispositions of property and equipment in 2004 and 2003 of $215 thousand and $982 thousand, respectively, the Company's income from operations for the full year 2004 increased by $1.6 million or 25.1 percent over the full year 2003.
Net income for the 2004 fourth quarter was $4.3 million, or $0.10 per diluted share, including deferred income tax benefits of $1.7 million and foreign currency exchange gains of $557 thousand, net of income taxes of $293 thousand. In the fourth quarter of 2003, net income, including $3.9 million in deferred income tax benefits, was $5.7 million, or $0.13 per diluted share. Excluding non-cash deferred income tax benefits and foreign currency exchange gains in the respective quarters, the Company's net income for the fourth quarter of 2004 increased by 18.7 percent over the 2003 quarter.
For the full year 2004, the Company earned $9.9 million, or $0.22 per diluted share, including non-cash deferred income tax benefits of $1.7 million, disposition gains of $215 thousand, and the previously mentioned foreign currency exchange gains. By comparison, net income for 2003 was $16.0 million, or $0.37 per diluted share, and included $8.8 million in non- cash deferred income tax benefits and disposition gains of $982 thousand. Excluding non-cash deferred income tax benefits, disposition gains and foreign currency exchange gains in the respective years, net income for 2004 increased 19.7 percent over 2003.
At December 31, 2004, the Company's cash and investments approximated $9.0 million and its borrowings under its credit facility were $4.5 million, as compared to cash and investments of $9.5 million and credit facility borrowings of $7.2 million at December 31, 2003. The Company's cash flows from operating activities in 2004 of approximately $12 million enabled the financing of the IMP acquisition and the Company's other capital needs while improving the Company's net cash position (which is defined as cash and investments less the Company's credit facility borrowings) by $2.2 million. Mr. Lee concluded, "Based on our initiatives for 2005 and excluding the effect of any possible future acquisitions, we believe that our revenues for 2005 will be in the range of $137 million to $142 million, and we believe our earnings will be in the range of $0.23 to $0.25 per diluted share, excluding the impact of any future deferred income tax benefits. Our forecasted earnings for 2005 of $0.23 to $0.25 per diluted share compares favorably to earnings of $0.185 in 2004, excluding the $1.7 million in deferred income tax benefits. During 2005, we are looking for gross margin and operating income improvements by improving our leverage through increasing our net revenues, all of which equates to stronger earnings. As we have mentioned previously, we continue to seek attractive acquisition candidates which complement our core manufacturing, distribution and sales and marketing competencies. During 2005, we hope to strengthen Microtek's position as a leading supplier of high quality infection control products to hospitals and outpatient facilities both domestically and abroad."
A conference call replay will be available through 11:59 p.m. Eastern Time on March 4, 2005 and can be accessed by calling 1-877-660-6853 (U.S.) or 1-201-612-7415 (international); for both reference conference call account #1628, Conference ID #135956.
Actual Results Could Differ From Forward-Looking Statements: This Press Release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, the Company's forecasted revenues and forecasted earnings for 2005, the Company's statement that it is looking for gross margin and operating margin improvements by improving its leverage through increasing its net revenues, the Company's ability to consummate acquisitions which complement the Company's core competencies, and the Company's plan to strengthen its position as a leading supplier of high quality infection control products to hospitals and out-patient facilities both domestically and abroad. Such statements are subject to certain factors, risks and uncertainties that may cause actual results, events and performance to differ from those referred to in such statements. These risks include, without limitation, those identified in Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2003, including, without limitation, the risks described in Risk Factors under the captions "-Reliance upon Microtek," "-History of Net Losses," "-Competition," "-Product Liability," "-Stock Price Volatility," "-Dependence on Key Personnel," "-Anti-takeover Provisions," "-Low Barriers to Entry for Competitive Products," "-Potential Erosion of Profit Margins," "-Risks of Completing Acquisitions," "-Risks of Successfully Integrating Acquisitions," "-Small Sales and Marketing Force," "-Reliance upon Distributors," "-Reliance Upon Large Customers," "-Microtek Regulatory Risks," "-Risks of Obsolescence," "-Reduced OREX Market Potential," "OREX Commercialization Risks," "-OREX Manufacturing and Supply Risks," "-Risks Affecting Protection of Technology," "-Risks of Technological Obsolescence" and "-OTI Regulatory Risks." We do not undertake to update our forward-looking statements to reflect future events or circumstances.
About Microtek: The Company, a market leader in the healthcare industry, develops, manufactures and sells infection control products, fluid control products and safety products to healthcare professionals for use in environments such as operating rooms and outpatient surgical centers.
(In thousands, except for per share data) Three months ended Year ended December 31 December 31 2004 2003 2004 2003
Net revenues $33,143 $26,462 $126,581 $98,664
Gross profit 13,260 10,828 49,564 39,216
Operating expenses:
Selling, general and administrative 10,505 8,670 39,483 31,261
Research and development 236 227 1,048 940
Amortization of intangibles 344 113 809 440
Total operating expenses 11,085 9,010 41,340 32,641
Gain on dispositions - - 215 982
Income from operations 2,175 1,818 8,439 7,557
Interest expense, net (71) (45) (265) (179)
Foreign currency exchange gain 850 - 850 -
Other income, net 25 56 133 135
Income before income taxes 2,979 1,829 9,157 7,513
Income taxes:
Current tax expense (348) (81) (926) (300)
Deferred tax benefit 1,690 3,930 1,690 8,810
Total income tax benefit (expense) 1,342 3,849 764 8,510
Net income $4,321 $5,678 $9,921 $16,023
Net income per share - basic $0.10 $0.13 $0.23 $0.38
Net income per share - diluted $0.10 $0.13 $0.22 $0.37
Weighted average shares outstanding - basic 43,165 42,490 43,005 42,206
Weighted average shares outstanding - diluted 44,459 44,016 44,500 43,251
Balance Sheet Data: 2004 2003
Cash and cash equivalents $8,964 $9,462
Other current assets 55,366 54,749
Total current assets 64,330 64,211
Total assets 131,069 118,299
Current liabilities $15,511 $11,691
Long term debt, net of current portion 4,984 8,056
Other liabilities 1,931 2,008
Total liabilities 22,426 21,755
Shareholders' equity 108,643 96,544
Total liabilities and shareholders' equity $131,069 $118,299
Why did you post this, and no, it isn't that unusual to make a profit these days...
Oil companies are making huge profits.
This is just a small nugget of proof that the overall economy is not in the dumps, despite what Howard Dean, John Kerry, or the rest of the Democrats keep carping about.
Yes, some companies are doing quite well in spite of the gloom and doom disinformation put out by those who would try to take power via lies and innuendo.
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